MEXICO CITY, April 23, 2020 (GLOBE NEWSWIRE) -- Grupo Hotelero Santa Fe S.A.B. de C.V. (BMV: HOTEL) (“HOTEL” or the “Company”), announced its consolidated results for the first quarter (“1Q20”) ended March 31, 2020. Figures are expressed in Mexican pesos, are unaudited and are in accordance with International Financial Reporting Standards (“IFRS”) and may vary due to rounding.
|First Quarter||3 months ended March 31|
|Figures in thousand Mexican pesos||2020||2019||Var.||% Var.||2020||2019||Var.||% Var.|
|EBITDA Margin||26.7%||33.9%||(7.2 pt)||(7.2 pt)||26.7%||33.9||(7.2 pt)||(7.2 pt)|
|Net Income Margin||(103.5%)||17.1%||NA||NA||(103.5||17.1||NA||NA|
|Occupancy||59.5%||64.9%||(5.4 pt)||(5.4 pt)||59.5||64.9||(5.4 pt)||(5.4 pt)|
|Note: operating figures include hotels with 50%+ ownership.|
1 EBITDA is calculated by adding together Operating Income, Depreciation and Total Non-recurring expenses.
2 Revenue per Available Room (“RevPAR”) and Average Daily Rate (“ADR”).
Comments from the Executive Vice President
Mr. Francisco Zinser, stated:
In the first quarter up to the second week of March, results for the Company were aligned with internal expectations. For the remainder of March, however, the industry and world economy started to show significant slowdown due to the COVID-19 pandemic. Impacts were first apparent at urban hotels, where demand decreased significantly in an exceptionally short period of time. Resorts behaved a bit differently, showing signs of slowdown afterwards, and declining at a slower pace but eventually reaching the same very low occupancies as urban destinations. Within this environment it was difficult to have a clear view of what was happening to bookings, which were characterized by a sluggish booking pace.
As of today’s date, we have five properties in our portfolio (Krystal Urban Ciudad Juarez, Krystal Urban Guadalajara and Krystal Satelite María Barbara, which are 100% owned, and Hampton Inn Suites Paraíso Tabasco and Krystal Urban Aeropuerto Mexico City, which are third party owned) open and in operation, representing 11% of rooms, all in urban destinations. Although these hotels have exceptionally low occupancies, they are generating enough revenue to reach our breakeven point at an operational level. The rest of the hotels in our portfolio are temporarily closed. In some cases, as in Mexico City, the local government has instructed companies to close hotels under certain conditions, which in our case has not affected open properties from our portfolio in this city. We continue to take all the necessary measures in our hotels to prevent the risk of infection of our employees and customers through strict sanitation protocols.
As of today, we have no clarity as to when the federal and local governments or general conditions will allow us to resume operations in the temporarily closed properties, though we expect to do so as soon as we have the authorization and conditions allow. On the bright side, we are ready to open our properties with short notice in order to respond as quickly as possible. We are also working on a complete reopening plan for our hotels that will include marketing, operations, new disinfection protocols and determining new tourism trends and adapting to them as rapidly as possible. We hope that recovery starts in 3Q20 and that we can gradually build occupancy and rates, and thus reach our breakeven point of between 20% and 30% occupancy with current ADR, depending on the property and market.
Financially, we have implemented a variety of initiatives in order to preserve our working capital and lower our monthly operating expenses. The measures we have implemented in a bid to avoid laying off team members and to reduce the Company’s expenses, among other purposes, include: (i) the reduction of non-priority expenses; (ii) wage reductions at all levels in both corporate and operational structures, averaging approximately 50%; (iii) lowering operational costs and expenses at properties that remain open; and, (iv) deferring all non-essential CAPEX. We have been in close contact with our financial creditors, negotiating to obtain a period with no interest and amortization payments in order to protect our cash position. As soon as we receive conditions regarding these deferrals, which we expect shortly, we will inform the market. Taking everything I just mentioned into account, we are in a good financial position for the coming months.
Moving on to our quarterly results, revenue totaled Ps. 585.5 million, down 6.0% compared to 1Q19. EBITDA was Ps. 156.4 million in the quarter, down 26.0% compared to 1Q19. Regarding company-owned hotels, RevPAR decreased by 12.0%, due to a 4.2% decrease in ADR and a 5.4 percentage point decrease in occupancy.
Lastly, allow me to provide a quick update on the Hyatt Regency Mexico City Insurgentes. Early in 2019 we mentioned that the construction process was temporarily suspended. Today, we are pleased to announce that we are finalizing the administrative procedure to resume construction as soon as conditions allow.
I would like to highlight and express my gratitude to the more than 3,700 associates who have supported the Company unconditionally, not only with their economic contribution but with their tremendous attitude that goes beyond the call of duty. Among other employee initiatives, the Krystal Beach Acapulco is giving out 250 free lunches four times a week to the local arts and crafts vendors, among others, who have lost any possibility of generating revenue due to the lockdown at that destination.
As always, we are especially thankful for the trust and support of our shareholders in these times, and again to all of our tremendously professional and cooperative teams.
1Q20 Conference Call Details:
|HOTEL will host its earnings webcast (audio + presentation) to discuss results:|
|Date:||Friday, April 24, 2020|
|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 please dial:|
|Telephone:||U.S.: 1 877 271 1828|
|International: +1 334 323 9871|
|Mexico: 01 800 847 7666|
|Conference password: 67419109#|
|Webcast:||The webcast will be in English. To follow the Power Point presentation and the audio of the call, please visit our website www.gsf-hotels.com/investors|
About Grupo Hotelero Santa Fe
HOTEL is a leading company in the Mexican hotel industry, centered on acquiring, converting, developing and operating its own hotels as well as third party-owned hotels. The Company focuses on strategic hotel location and quality, a unique hotel management model, strict expense control and the proprietary Krystal® brand as well as other international brands. As of year-end 2019, the Company employed over 3,700 people and generated revenues of Ps. 2,238 million. For more information, please visit www.gsf-hotels.com.
|Enrique Martínez Guerrero|
Chief Financial Officer
Investor Relations Director
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