NHH delivered surprising H1 results that beat the market and improved further its liquidity and debt positions. The encouraging trading trend seen in recent weeks released positive signals for a constructive summer performance.
Companies: NH Hotel Group (NHH:BME)NH Hotel Group SA (NHH:MCE)
The market reacted negatively to NHH’s harder hit Q1 results and its plan for a rights issue in H2, despite a comfortable liquidity profile for the short term and the accelerated restoration of EBITDA. The group’s significant exposure to the still highly-constrained European market would be a concern, but its low dependence on international and B2B passengers could help once travel restrictions in Europe loosen.
NH Hotel reported slightly lower than expected revenue but a smaller than expected operating loss, showing its enhanced cost efficiency. Its liquidity and debt positions remain satisfactory, with no considerable debt maturity until 2023.
NHH’s FY19 results were consistent with market consensus and its previous guidance. However, it was unable to communicate any information about its FY20 guidance, nor about the Coronavirus impact.
84.3% of the group’s business concentrates on Spain, Benelux, Germany and Italy (17.9% of NHH’s total sales). Noting the high-speed of expansion of the Coronavirus in Europe in recent days, NHH may face considerable profit losses for FY20.
Companies: NH Hotel Group SA
NH has reported satisfying Q2 19 results.
Robust RevPAR growth has been mainly boosted by the strong pricing momentum across Europe and strong recovery in tourism in Barcelona.
NH is starting to integrate Minor’s Tivoli portfolio. The estimated additional EBITDA contribution has led management to upgrade its FY19 EBITDA guidance from €285m to “at least €290m”.
FY 18 revenue came in at €1.62bn (+4.3% yoy), and recurring EBITDA (Ex. onerous provision) was up 12.9% to €263.2m, broadly in line with consensus expectations.
The integration with Minor is progressing well in terms of brand integration, cross-selling, data sharing.
NH confirmed its EBITDA expectation of €285m and recurring net income of close to €100m for FY19
On 11 June 2018, Minor announced a tender offer for NHH.
On 26 October 2018, the bid was accepted and Thailand’s Minor completed the purchase with a 94.1% shareholding in NHH, becoming NHH’s new owner.
Minor initially targeted 51-55% of NHH’s shares but the tender resulted in exceeding a 39.1% shareholding.
Lack of visibility of NHH’s future and concern about the Thai group’s financial position due to the exceeded shareholding has led investors to walk away from NHH. The stock lost 60% in th
Q3 revenue came in at €412m (+2.9% yoy, +5.0% at constant exchange rates), and recurring EBITDA was up 7.6% to €72m, both in line with consensus expectations.
The expected weak performance in Spain has been fully offset by the strong growth in Benelux and Italy.
Recurring net income was €28m, above consensus, mainly helped by the lower financial costs due to a reduction in debt.
NH’s management has started to work with Minor (the new owner with 94.1% of the share capital) to define the new S
Short feedback after a conference call with Minor International (MINT)
H1 18 revenue grew by 3.9% to €785m and recurring EBITDA came in at €115m (+12% yoy), both in line with consensus expectations.
The figures were mainly supported by the robust performance in Benelux and the continued solid pricing environment in Italy, which were partially offset by the sluggish demand in Spain.
2018 outlook remains unchanged:
Recurring EBITDA: €260m (unchanged)
Net financial debt ratio: between 1.0-1.2x (after the early redemption)
Minor International’s CEO, William Heinecke, has recently shown he is confident about taking over NH Hotel Group by accumulating a stake of 55-65%.
At the end of May, the Thailand-based hospitality group, Minor International (then having a 1.1% share of NHH), announced the acquisition of an 8.6% stake in NH Hotels Group from London-based hedge fund Oceanwood Capital. The transaction was valued at €192m, which brought Minor’s shareholding to 9.7%. This transaction was unnoticed in the market.
Q4 revenues grew by 6.2%, to €403m, slightly above consensus estimates. RevPar rose 5.5%, thanks to both healthy occupancy (+3.2 pp, lfl) and ADR (+2.2%).
EBITDA came in at €63m (+11.4%), also marginally above expectations.
Recurring net income was €8m (+10.2%), missing consensus.
The company maintains its 2018 guidance of EBITDA at €260m. It also confirms its 2019 targets: EBITDA at c.€300m, with recurring net income at c.€100m.
The NH board’s refusal is mainly based on valuation.
A share price slump on Thursday 11 January could offer a buying opportunity.
Q3 revenue was up 6.3% yoy, to €404m, marginally above consensus expectations. RevPAR increased by 7.6% (lfl), again mainly thanks to the rise in the ADR (lfl +4.9%), but also a robust occupancy rate (lfl at 74.7%, improving by 2.5pp).
EBITDA came in at €67m (+31%), beating consensus.
Recurring net income was at €18m.
The company confirmed its 2017 guidance on EBITDA at €230m (as announced at the investors day in September). NH Hotel aims at an EBITDA of c.€300m in 2019, with recurring net in
Q2 revenue, at €436m (+5.4% yoy), was in line with expectations. RevPAR increased by 9.6%, mainly thanks to the improvement in ADR (+6.6%).
The EBITDA, at €92m (+18.7% yoy), was slightly above consensus estimates.
Net recurring income came in at €36m (+13% yoy).
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Companies: Vertu Motors PLC
Vertu has delivered an impressive set of record H1 results, which showed strong volume outperformance and pricing discipline across all markets. We are raising our FY22 forecasts by 19% to reflect current management guidance and leave our FY23/24 forecasts unchanged for now. Our near term value per share increases to 86p implying a healthy risk reward profile from here.
Entain registered Q3 21 top-line growth of 6%, driven largely by online (10%). In the all-important US market, BetMGM surged ahead with a further expansion in market share of (23% in three months to August vs 22% in Q2 21).
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