Hotel group PPHE reports double-digit growth after strong summer
Hospitality real estate group PPHE has reported strong growth driven by higher occupancy rates in central and eastern Europe.
The LSE-listed company posted record revenue of €125.4m (£104.8m), an increase of €12.6m, or 11 per cent, year on year.
The firm, which is registered in Guernsey, said that demand continued to increase for its city centre hotels and its leisure properties.
It said that growth was strongest in the central and eastern Europe (CEE) region, with revenue growth of 14 per cent in Germany and 22 per cent in the CEE as a whole, largely due to higher occupancy rates.
PPHE owns and operates the art’otel brand and the Arena hospitality brands, as a well as a Radisson Hotel Collection and two Radisson RED properties.
Group earnings before interest, tax, depreciation and amortization (EBITDA) rose to €39.4m, up 13 per cent from €35m the previous year.
PPHE said that this “significant improvement” was the result of the “strong summer revenue performance in Croatia, continued revenue growth in German and CEE portfolio coupled with a strict cost discipline”.
It said that the growth in national minimum wage across its operating continued to affect overall operating expenses, as did an increase in service sector prices.
However, PPHE said it realised savings in the cost of utilities, driven down by lower electricity costs, which it said fell by 9 per cent year on year. In Budapest, expenses were reduced by more than 50 per cent, it said.
“Given the current economic climate the Group, plans to conserve and improve its liquidity, nevertheless remains committed to uplifting the campsite and hotel portfolio standard through regular investment projects, rebranding to maximise opportunity, prepare for investments throughout all the regions and explore new high potential growth opportunities in Croatia and Central and Eastern Europe,” president of the management board, Reli Slonim, said.
The company kept guidance in line with expectations.