CORRECTING and REPLACING Grupo Hotelero Santa Fe Reports Increase of 37% in Total Revenue and 49% EBITDA for 3Q15

CORRECTION...by Grupo Hotelero Santa Fe

MEXICO CITY--()--Second sentence, third paragraph of CEO comments of release dated October 22, 2015, should read: It is important to highlight that the EBITDA for the last 12 months reached Ps. 288.5 million (instead of It is important to highlight that the EBITDA for the last 12 months reached US$288.5 million).

The corrected release reads:

GRUPO HOTELERO SANTA FE REPORTS INCREASE OF 37% IN TOTAL REVENUE AND 49% EBITDA FOR 3Q15

Grupo Hotelero Santa Fe S.A.B. de C.V. (BMV:HOTEL) (“HOTEL” or “the Company”), announced today its consolidated results for the third quarter period ended September 30, 2015 (“3Q15”). Figures are expressed in Mexican Pesos, are unaudited and are in accordance with International Financial Reporting Standards (“IFRS”).

3Q15 Highlights

  • Total Revenue for 3Q15 reached Ps. 239.9 million, 37.0% higher compared to 3Q14, driven by increases of 42.1% in Room Revenue, 37.6% in Food and Beverages and 18.7% in Other Revenue.
  • As a result of the revenue growth, EBITDA1 reached Ps. 77.6 million, 48.8% higher than the figure reported in 3Q14. EBITDA margin increased 2.6 percentage points versus 3Q14, reaching 32.3% for 3Q15.
  • Dollar-denominated revenue represented 14.9% of total revenue of 3Q15, thereby maintaining a natural hedge of the dollarized financial debt and a Net Debt/EBITDA ratio equal to 3.1x for the last 12 months period.
  • Operating cash flow reached Ps. 82.6 million in 3Q15, 75.6% higher compared to Ps. 47.0 million in 3Q14. Operating cash flow for the first nine months of 2015 was Ps. 243.0 million, up 68.2% compared to Ps. 144.5 million from the same period of 2014. The increase was mainly driven by the growth in EBITDA and a more efficient working capital management.
  • HOTEL’s total portfolio at the end of 3Q15 reached 3,898 rooms in operation, an 18.3% increase compared to the 3,295 rooms the Company operated at the end of 3Q14. The 603 room increase is the result of acquisitions (71%), properties under development (22%) and hotel expansions (7%).
  • RevPAR2 of Company-owned hotels grew 14.1% vs. 3Q14, driven by an ADR increase of 9.2% and 2.7 percentage point increase in occupancy.
  • As a result of the strategic alliance between HOTEL and Grupo Aeroportuario del Centro Norte, S.A.B. de C.V. (BMV: OMA), at the end of August HOTEL started operating the 134-room Hilton Garden Inn Monterrey Aeropuerto. The Company holds a 15% ownership and is in charge of the hotel operations.

Comments from the Chief Executive Officer

Mr. Francisco Zinser, stated:

During the third quarter of 2015 we continued to generate outstanding profits. Revenues increased 37% while our EBITDA increased 48.8% with respect to 3Q14. These results were mainly driven by growth in occupancy and ADR equal to 2.7 percentage points and 9.2%, respectively. In addition, we continued our efforts to improve margins at the recently-acquired hotels such as Krystal Grand Cancun, Krystal Urban Cancun and Krystal Satelite Maria Barbara.

On August 27, we incorporated the Hilton Garden Inn Monterrey Aeropuerto hotel to our portfolio, as a result of a co-investment with OMA. Our Company owns 15% of the property and signed a contract to operate the hotel. This property had a successful start, given its extraordinary product and excellent location within the airport premises. After the end of the quarter, on October 15, we inaugurated the Hampton Inn & Suites Paraíso, Tabasco hotel. This property is owned by a third party and is the sixth hotel that has been added to the portfolio under the third-party operating agreement, which further demonstrates our operational capacity.

This quarterly report is especially significant for the Company as it marks HOTEL’s first anniversary of listing on the Mexican Stock Exchange. It is important to highlight that the EBITDA for the last 12 months reached Ps. 288.5 million, which is at the higher end of our 2015 guidance. During the same period, we have added three hotels and a total of 603 rooms, 78% of which operate under the Krystal brand, in line with our strategy to increase the brand’s presence. In line with our goals, our presence within the urban destinations rose from 43% to 49% of our portfolio.

The sector continues to demonstrate solid fundamentals. From January to August 2015, international passenger traffic has increased 8.4% compared with the same period of 2014, while revenue generated by this segment increased 8.0%. Airport traffic grew 12.2%; this average is the result of increases of a 12.8% and 11.2% growth in the domestic and international segments, respectively. As a result of the aforementioned, Mexico has risen from 15th place to 10th in terms of international tourist passenger arrivals3.

We continue to focus on client service and quality in order to provide our clients with an enjoyable experience during their stay at our hotels, maintaining the hospitality standards that characterize us.

Once again we thank our shareholders for their trust in our Company and we continue to focus on generating outstanding financial results for them. We have achieved these results, largely as a result to the professional work of each one of our employees throughout the 9 cities, 13 hotels and 3,898 rooms in operation. The third quarter concludes with 73% of our rooms under the Krystal® brand, growing in line with our strategy to be present in unique locations, and maintaining our objective of becoming the leading hotel operator in Mexico.

3Q15 Conference Call Details:

 
HOTEL will host its earnings webcast (audio + presentation) to discuss results:
 

Date:

Friday, October 23, 2015
 

Time:

12:00 p.m. Mexico City Time
1:00 p.m. New York Time
 
To participate in the conference call and Q&A session (audio) please dial:
 

Telephone:

U.S.: 1 800-863-3908 and 1 334-323-7224

 

México: 01 800-522-0034

 
Conference password: HOTEL 000
 

Webcast:

The webcast will take place in English. To follow the Power Point presentation, please visit our website at: http://www.gsf-hotels.com/investors/.

About Grupo Hotelero Santa Fe

HOTEL is one of the leading companies in the Mexican hotel industry and is focused on acquiring, developing and operating hotels. The Company has a unique business model characterized by its flexibility and adaptability as HOTEL´s experience allows it to operate under different brands, local and foreign, in different segments.

The Company maintains a focus on the strengthening and positioning of its Krystal® brand, which has considerable recognition in the Mexican market. This strategy allows HOTEL to offer different experiences adapted to the specific demand in each market and to maximize the profitability of its investments.

The Company’s operating model is characterized by the multi-functionality and efficiency of its personnel, as well as a strict cost control that allows a rapid adaptation and anticipation to the changing necessities of the industry. HOTEL has the capacity to add new hotels to its existing portfolio through acquisition, development and conversion of properties or through the celebration of operating contracts with third parties. The Company considers that its diversified portfolio and its management capacities focused on profitability, in addition to the property of a brand with high recognition in the market, all together help HOTEL to obtain new operating contracts for hotels owned by third parties.

1 EBITDA is calculated by adding Operating Income, Depreciation and Total Non-recurring expenses.

2 Revenue per Available Room (“RevPAR”) and Average Daily Rate (“ADR”).

3 Source: DATATUR 2015.

Contacts

Grupo Hotelero Santa Fe
Enrique Martínez Guerrero
Chief Financial Officer
inversionistas@gsf-hotels.com
or
Miguel Bornacini R.
Head of Investor Relations
inversionistas@gsf-hotels.com
www.gsf-hotels.com

Contacts

Grupo Hotelero Santa Fe
Enrique Martínez Guerrero
Chief Financial Officer
inversionistas@gsf-hotels.com
or
Miguel Bornacini R.
Head of Investor Relations
inversionistas@gsf-hotels.com
www.gsf-hotels.com