Pandox acquires 18 hotels in Germany

Transcription

1 Pandox acquires 18 hotels in Germany A good match both in terms of strategy and business model Stockholm, 5 December 2015 Anders Nissen, CEO Liia Nõu, CFO

2 Forward-looking statements This presentation contains forward-looking statements. Such statements are subject to risks and uncertainties as various factors, many of which are beyond the control of Pandox AB (publ), may cause actual developments and results to differ materially from the expectations expressed in this presentation. PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 2

3 Pandox acquires 18 hotels in Germany A good match both in terms of strategy and business model 18 hotel properties in 12 German cities with a total of 3,415 rooms. Total consideration of MEUR 400, corresponding to c. MSEK 3,700 1 on a debt free basis including minority share. Stable markets with a mix of international and domestic demand. The hotels are positioned as full service products in the upper mid-market segment. The hotels will be marketed and operated by Leonardo Hotels. The business model is lease contracts, and new 25-year revenue-based lease agreements with good guarantees have been entered into with Fattal Hotels. The portfolio is expected to increase Pandox s rental revenues by c. MSEK and cash earnings by c. MSEK in 2016, provided the acquisition is completed before year-end Sellers are the Leopard Group and Fattal Hotels. The acquisition is made together with Eiendomsspar AS as a minority shareholder with 5.1 percent. 1) At current exchange rate PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 3

4 Portfolio overview including Leonardo Hotels Based on market value per 30 September 2015 and current exchange rate Focused strategy on large hotel properties in the uppermedium to high-end segments in strategic locations Active ownership model combining a large, attractive portfolio with excellent operational skills ~8% ~10% ~42% Pandox Group Property Management Operator Activities ~8% 121 Hotel Properties 103 2,3 Leased Out 18 3 Operated ~32% 1 SEK 31.3bn Portfolio Market Value 2 25,182 80% Portfolio Market Value 19,745 20% Portfolio Market Value 5,437 Rooms Rooms Rooms Portfolio market value overview including Leonardo Hotels, based on portfolio market value per 30 September 2015, excluding the previously communicated divestment of Scandic Antwerp which was closed 1 December 2015, and current exchange rate 1) International which includes Belgium, Germany, Switzerland and Canada. 2) Excluding Scandic Antwerp divested 1 December ) Hotel Prince Philip was reclassified to Operator Activities 1 October PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 4

5 Strategic drivers for the acquisition Fulfils all Pandox s strategic criteria 1 Increases cash earnings and creates opportunities for value growth 6 Further potential in cooperation with Fattal Hotels 2 Germany is a prioritised market where Pandox already has exposure Increases the share of Property Management 5 3 Prioritised segment with full service hotels in upper mid-market with a wellbalanced demand 4 Lease model with long agreements where the operator has the main responsibility for investments PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 5

6 Portfolio of quality hotels Positioned in a stable and profitable market segment Leonardo Royal Hotel Düsseldorf Königsallee (253 rooms) Leonardo Hotel Mönchengladbach (128 rooms) Leonardo Hotel Mannheim City Centre (148 rooms) Leonardo Hotel Hannover Airport (213 rooms) Leonardo Royal Hotel Frankfurt (449 rooms) Leonardo Hamburg City Nord (182 rooms) PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 6

7 Portfolio overview 18 hotels in 12 cities with a total of 3,415 rooms Hotel City Number of rooms Location Leonardo Royal Frankfurt Frankfurt 449 City centre Holiday Inn Frankfurt Airport North Frankfurt 295 Airport Leonardo Royal Düsseldorf Königsallee Düsseldorf 253 City centre Leonardo Hannover Airport Hannover 213 Airport Leonardo Wolfsburg City Center Wolfsburg 212 City centre Holiday Inn Düsseldorf Airport Düsseldorf/Ratingen 199 Airport Leonardo Hamburg City Nord Hamburg 182 Ring road Leonardo Hannover Hannover 178 Central residential Leonardo Köln-Bonn Airport Cologne 177 Airport Leonardo Heidelberg Heidelberg 169 Ring road Leonardo Heidelberg-Walldorf Heidelberg/Walldorf 161 Central Leonardo Royal Köln am Stadtwald Cologne 150 Central residential Leonardo Mannheim City Center Mannheim 148 City centre Leonardo Karlsruhe Karlsruhe 147 City centre Leonardo Düsseldorf City Center Düsseldorf 134 City centre Leonardo Mönchengladbach Mönchengladbach 128 City centre Leonardo Royal Baden-Baden Baden-Baden 121 City centre Leonardo Aachen Aachen 99 City centre Total 3,415 Average room size 190 PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 7

8 Financial effects: earnings and business At full consolidation and at current exchange rate The portfolio is expected to increase Pandox s rental revenues by c. MSEK and cash earnings by c. MSEK in 2016, provided the acquisition is completed before year-end Fattal Hotels remains as a long-term lessee in all of the hotel properties with new 25-year revenue-based lease agreements with good rental guarantee levels. Pandox s responsibility for future investments is limited to major technical investments and building structure, which means property costs are lower compared with Pandox s Nordic hotel property portfolio. Pandox sees good potential to, in close cooperation with Fattal Hotels, make future cash flow enhancing investments in the acquired hotel property portfolio. 1) At current exchange rates PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 8

9 Financial effects: portfolio and business mix At full consolidation and at current exchange rate Based on the market value of the hotel property portfolio per 30 September 2015: The portfolio value increases from c. SEK 27.7bn to c. SEK 31.4bn. Excluding the previously communicated divestment of Scandic Antwerp, which was closed 1 December 2015, the portfolio value increases to c. SEK 31.3bn. Investment properties share of the total property value increases from c. 77 percent to c. 80 percent. Pandox s loan-to-value ratio (net) increases from c. 44 percent to c. 51 percent, which should be compared with the company s financial target of a loan-to-value ratio of percent (gross) with normalised liquidity. 1) At current exchange rates PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 9

10 Other information The acquisition price amounts to MEUR 400, corresponding to c. MSEK 3,700 at the current exchange rate, on a debt free basis including minority interest. Pandox AB s ownership share amounts to 94.9 percent and Eiendomsspar AS s ownership share amounts to 5.1 percent. This structure is considered the most efficient solution for all Pandox s shareholders. The acquisition is financed by a new and agreed five year bank loan, existing bank loans and existing liquid funds. The seller is the Leopard Group, which is a holding company with property interests in the UK and Germany, and the Fattal Hotels of Israel. The acquisition is expected to be completed by the end of 2015, and is conditional upon having received necessary approvals by German authorities, and the fulfillment of the terms in the share transfer agreement. Pandox will consolidate the acquired hotels to 100 percent and report these under the business segment Property Management, and report minority interest at the consolidated group level, from the first quarter PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 10

11 Thank you! Time for questions! PANDOX EXCELLENCE IN HOTEL OWNERSHIP & OPERATIONS 11

12 Pandox AB (publ) Postal address: Box 15 SE Stockholm Sweden Visiting address: Vasagatan 11, 9 th floor Stockholm Sweden Financial calendar: Feb 18, 2016 Year-end report for the period Jan Dec 2015 May 3, 2016 Annual general meeting 2016 May 4, Interim report for the period Jan-Mar 2016 August 18, 2016 Interim report for the period Apr-Jun 2016