• Second-half revenue of €618 million tripled the €216 million of the first half, predicting a sharp and swift recovery once Omicron wave is surpassed
  • The strong activity reactivation translated into revenue growth of 54% in 2021 to €834 million, underpinned by the Group’s strength and positioning in the leisure segment in southern Europe, as well as a gradual recovery in business travel after the summer months
  • The Group’s solid pricing strategy throughout the second half drove the average daily rate (ADR) from €73 in the first half of the year to €91 in the third quarter and €98 by the fourth, very close to pre-Covid levels. The average for the year was €89
  • Reactivation of the business, coupled with strict cost controls, enabled the Group to generate €29 million of cash in the second half, not including the capital increase. Net debt decreased by €118 million in 2021

Madrid - NH Hotel Group reported consolidated net profit of €41.5 million in the fourth quarter of 2021, marking the first quarter with positive result since the start of the pandemic. Between October and December 2021, recurring EBITDA, excluding the impact of lease accounting under IFRS 16, was €54.0 million, compared to a loss of €81.0 million in 4Q20.

The recovery is gaining momentum quarter after quarter. The Group reported second-half 2021 revenue of €618 million, which is nearly triple the €216 million earned between January and June. Full-year revenue totalled €834 million, up 54.6% from 2020 (€540 million). During the second half, the revenue recovery was stronger in the south of Europe thanks to fewer restrictions; there, momentum in the leisure travel business was joined by a gradual recovery in business travel with a significant impact across the main city destinations.

In 2021, NH Hotel Group’s reported consolidated loss decreased by 69.4% to €133.7 million (compared to loss of €437.2 million in 2020). Reported EBITDA amounted to €216.4 million in 2021, compared to just 4.6 million in 2020. The business upturn in the second half, coupled with strict control over costs, also allowed the Group to stem the cash drain, generating €29 million of cash in the second half of the year. In addition, the rights issue and asset rotation during the year enabled a reduction in net debt from €685 million at year-end 2020 to €567 million at 31 December 2021. The company has liquidity of €511 million, of which €244 million is held in cash. The liquidity reinforcement achieved in 2021 has allowed the Group to start to reduce its gross debt without impacting its liquidity. Accordingly, it repaid the €236 million drawn under the RCF in full in 2021.

Ramón Aragonés, NH’s CEO, believes that the “significant effort” during the past two years will increase the Group’s value as the recovery gains traction. “In 2021 we managed to reduce our losses by 70% and resume cash generation in the second half by focusing on cost control and pricing strategy as the business began to pick up. We are well on our way back to profitability. We expect to complete that trajectory this year, leveraging our unique value proposition in the leisure segment, preferred urban locations in emblematic cities and the gradual recovery unfolding since the summer in the MICE and business travel segments. Omicron has had a significant impact but limited in time to the months of lower activity. The data we have so far this year points to a recovery from one week to the next, inviting optimism and leaving us convinced that the good news will start to arrive with greater speed”.

Hotel occupancy averaged 34% in 2021, up nine percentage points from 2020. Note that over the course of the year, occupancy more than doubled, from 19% in the first half to 49% by the third quarter and 50% in the fourth, despite the dip sustained during the final weeks of the year. It was in the second half of the year, when activity started to further recover, that the Group’s solid pricing strategy translated into stronger growth in the ADR: from €73 in the first half of the year to €91 in the third quarter and €98 by the fourth, very close to pre-Covid levels. The average for the year was €89, compared to €84 in 2020.

The revenue breakdown by quarter reveals the clear-cut upward trend, for full-year growth of 54.6%.

Strong domestic demand and the gradual recovery in intra-European demand played an important role in the trend observed. The number of hotels in operation increased from 60% at the beginning of the year to 95% by September. The Omicron variant drove a reduction in occupancy in Europe from 62% in October to 37% in December. January continued to be affected, with occupancy in Europe at just 26%; however, the market began to recover during the initial weeks of February 2022. The company views the impact of Omicron as a transient phenomenon which is already giving way to an intense and swift recovery in all segments of the business.

Revenue per available room - RevPAR - recovered more intensely in southern Europe thanks to the lifting of restrictions. In Italy, RevPAR increased by 97% in comparison to 2020; in Spain, by 83%; in LatAm by 54%, in Benelux by 15% and in Central Europe, by 2%. In Spain, RevPAR in the secondary cities surged by 91%, compared to growth of 72% in Madrid and 68% in Barcelona. In Italy, RevPAR growth was particularly buoyant in Rome (+120% from 2020) and Milan (+96%), compared to growth of 89% in the secondary cities.

Regarding revenue recovery by region, in Spain, it increased by 71.6% in 2021, with growth in the main city destinations in the second half particularly noteworthy. In Italy, annual revenue increased by 83.9%. Revenue was stable year-on-year in Benelux and 59.9% higher in Central Europe, largely thanks to direct state aid in those markets. Lastly, revenue in Latin America increased by 64.5% in constant-currency terms, with Chile and Colombia (+70%) as the strongest markets, followed by Mexico (+52%) and Argentina (+46%).

About NH Hotel Group, part of Minor Hotels

NH Hotel Group, part of Minor Hotels, is an established multinational hotel operator and a benchmark urban hotel chain in Europe and the Americas, where it runs over 350 hotels. Since 2019, it has been working with Minor Hotels on integrating all of its hotel trademarks under a single corporate umbrella brand with a presence in over 50 countries worldwide. Together they have articulated a portfolio of more than 500 hotels operating under eight brands – Anantara, Avani, Elewana, Oaks, NH Hotels, NH Collection, nhow and Tivoli – which between them provide a broad and diverse spectrum of hotel solutions in touch with the needs and desires of today's global travellers.

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