The Orbis Hotel Group

The Orbis Group
June 2011
1Q 2011 financial results
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Orbis Shareholders
Accor S.A.
BZ WBK AIB Asset
Management S.A.
Aviva OFE
27,78%
50,01%
Free float
10,10%
12,11%
As on 27/05/2011
Market cap: PLN 1,800 million
2
The Orbis Group
Hotels
4/5 of sales of The Orbis Group
Rent-a-car and car-lease (Hertz
licensee), parking lots management,
municipal transport.
1/5 of sales of The Orbis Group
On March 1, 2011 Orbis S.A. has disposed its 33% stake in the Orbis Casino sp. z o.o.
and by that has withdrawn from casino segment. At the same time the leasing of casino
premises in the Orbis Group hotels has been prolonged by 14 years and shareholders of
Orbis Casino agreed to change the name of the company.
3
The Orbis Group – structure
Orbis Hotel Group
Orbis S.A.
Hekon
Orbis Transport
UAB
Hekon
Orbis
Kontrakty
4
Orbis focuses on hospitality
Hospitality
– core business & key competence of Orbis
Orbis Travel
disposal
(1Q2010)
International coach
business’
disposal
(2Q2010)
Shares of Orbis
Casino
disposal
(1Q2011)
Orbis Transport – planned for sale
5
Poland – key international players in
hospitality business
(No of hotels)
Orbis (59)
11454
Starwood (6)
1514
Vienna Hotel (10)
1477
Qubus (6)
1339
Rezidor (6)
1323
IHG (6)
1221
Louvre Hotel (5)
1095
Marriott (2)
Źródło: MKG Hospitality 2010
690
0
7000
14000
(No of rooms)
6
Polish hospitality market by segments
100%
90%
80%
Niesieciowe
92%
Upscale
35%
70%
60%
50%
Midscale 48%
40%
30%
20%
10%
Ekonomiczne 17%
Markowe 8%
0%
Hotels
Źródło: MKG Hospitality 2010
Branded hotels
segmentation
Of 1,600 hotels (82,000 rooms) only 121 are branded (21,730 rooms),
Low penetration rate: 8 % of branded hotels, 26 % of branded rooms
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The Orbis Hotel Group
56 hotels in Poland and 1 in Lithuania,
25 cities, nearly 11,000 rooms
Orbis Hotel Group
consists of:
49 hotels owned,
5 hotels leased,
3 hotels managed
Two hotels operated under „Orbis Hotels” brand – Cracovia in Kraków and Neptun in Szczecin
have been disposed in March 2011. The Orbis Group is going to manage them until June 30th.
Additionally, Solny Hotel in Kołobrzeg has been closed June 5th 2011.
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The Orbis Hotel Group
– hotel portfolio by number of rooms
5 stars 6%
Sofitel 6%
1 star 9%
Orbis Hotels
18%
Novotel
29%
2 stars 15%
4 stars 30%
Mercure
23%
Etap 9%
Brands
3 stars 40%
Ibis 15%
Standard
# June 2011
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Transformation of the hotel structure
Current structure
Target structure
3
13
12
10
55% hotels in the
economy segment
8
11
10
Development of hotel portfolio in 2008-2011
New developments
Opening
No. of rooms
ETAP BRONOWICE KRAKÓW
May, ’08
124
ETAP KATOWICE CENTRUM
May, ’08
124
ETAP WROCŁAW POŁUDNIE
Oct, ’08
109
ETAP WROCŁAW STADION
Dec, ’08
122
IBIS CENTRUM KIELCE
May, ’09
114
ETAP TORUŃ
Aug, ’09
80
Total
673
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Restructuring of hotel assets in 2008-2010
Hotels
Disposal
date
Closing
date
No. of
rooms
ORBIS GRAND ŁÓDŹ
Dec, ’07
Dec, ’09
161
ORBIS BESKID NOWY SĄCZ
Nov, ‘09
Dec, ’09
78
NOVOTEL OLSZTYN
Dec, ’09
Mar, ’10
97
ORBIS POLAN ZIELONA GÓRA
Dec, ‘10
Oct, ’10
78
ORBIS PROSNA KALISZ
Apr, ‘11
Nov, ’10
103
ORBIS SOLNY KOŁOBRZEG
-
Jun, ’11
144
ORBIS NEPTUN SZCZECIN
Mar, ’11
Jun, ’11
285
ORBIS CRACOVIA KRAKÓW
Mar, ’11
Jun, ’11
314
Total
1260
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New developments
Warszawa – Ibis & Etap (330 rooms)
– re-launched in January 2011
Considered:
Łódź – Novotel (162 rooms)
Kraków – Ibis & Etap (296 rooms)
High potential of Polish hospitality market:
• Still underdeveloped economy segment
• Significant market share of independent hotels – space for
development of franchising
• Despite lower than European average performance
indicators, international hotel chains invest in Poland
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New business model – asset light
Orbis today
Orbis tomorrow
Activities
Hospitality
Touroperator (sold)
Transport/Rent-a-car
Gambling (sold)
Hospitality
Business
model
Traditional owner
& Hotel operator
Service provider
& Hotel operator
90% owned
10% leased / managed
Asset management and
Asset light development
Long term target:
80% asset light
Ownership
structure
Choose the most relevant asset light structure
to reduce volatility while developing network
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Orbis Hotel Group portfolio
- operating model
C&E Europe, Accor
Poland
8%
5%
France, Accor
2%
4%
10%
11%
14%
46%
52%
87%
Owned
Fixed lease
30%
27%
Variable lease
4%
Managed
Franchised
Majority of Orbis Hotel Group portfolio is owned
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New business model – asset light
A portfolio of strong brands
Highest RevPAR index
… federating hotels expertise & know
how
Strong cash flow generation
High attractiveness for all our partners
16
Financial and operating results
of the Orbis Group
and
the Orbis Hotel Group
17
Occupancy and ARR changes
in the economic cycle
7 cities
representing
84% revenues
OR
High
ADR
High
ADR
OR
Low
ADR
High
OR
of Orbis
OR
Warszawa
Wrocław
OR
ADR
ADR
OR
High
OR
Low
ADR
Low
OR
Poznań
ADR
Low
ADR
Kraków
Tri-city
Szczecin
Katowice
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The Orbis Group in 1Q2011

Confirmed focus on hospitality: disposal of shares in Orbis Casino
resulting in withdrawal from the gambling segment

Moderate upward trend continues: Orbis Hotel Group sales increase by
2.6% like-for-like (2% as reported) to PLN 144.5 million

Further restructuring of the Orbis Hotel Group portfolio: relaunch of the
construction of Ibis and Etap in Warsaw and disposal of two hotel
properties, Cracovia in Kraków and Neptun in Szczecin

EBITDA result of the Orbis Group grew by PLN 13 million. This was
mainly due to gains from disposal of two hotels in 1Q2011 and successful
tapping into positive market trends.

Financial costs were curbed by PLN 1.2 million owing to repayment of
PLN 94 million of debt in November 2010. As a result, net profit for the first
quarter increased by more than PLN 13 million to 0.4 mln.

In Orbis Transport EBITDA margin increased significantly from 24.5% to
29%, owing to decrease of overhead & administrative expenses by more
than 20% and 2010’s disposal of the low-margin segment of international
busses. Additionally, rent-a-car segment brought 30% more car rental
days than in 1Q2010.
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The Orbis Hotel Group:
operating results 2010
Occupancy rate
Average Room Rate (ARR) in PLN
Revenue per Available Room
(RevPAR) in PLN
Number of roomnights sold
Number of rooms
2010
2009
 2009/2010
48,67%
47,30%
1,37pp
216,8
225,0
-3,64%
105,5
106,5
-0,94%
1 952 143
1 940 531
0,60%
10 812
11 181
-3,30%
change
in points
% structure of roomnights sold
Poles
53%
50%
3,00pp
Foreigners
47%
50%
-3,00pp
Business clients
61%
61%
0,00pp
Tourists
39%
38%
0,00pp
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The Orbis Hotel Group:
operating results after 1Q2011
1Q2011
1Q2010
 2011/2010
 2011/2010
Like-for-like
41,50%
40,50%
1,0pp
0,4pp
214,9
208,3
3,2%
2,9%
89,2
84,3
5,8%
3,8%
Number of roomnights sold
403 871
403 895
0,0%
-
Number of rooms
10 812
11 098
-2,6%
-
Occupancy rate
Average Room Rate (ARR) in PLN
Revenue per Available Room
(RevPAR) in PLN
change
in points
% structure of roomnights sold
Poles
62%
60%
2,0pp
-
Foreigners
38%
40%
-2,0pp
-
Business clients
72%
67%
5,0pp
-
Tourists
28%
33%
-5,0pp
-
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The Orbis Hotel Group:
economy vs. up & midscale
1Q2011
Occupancy
ARR
RevPAR
(%)

points
PLN
(%)
PLN
(%)
Up&Midscale
39,3
+ 1,0
231,8
+ 3,9
98,1
+ 6,7
Economy
49,9
+ 0,8
164,1
+ 0,8
81,9
+ 2,5
Up&Midscale
46,3
+ 1,1
234,6
- 2,1
108,5
+ 1,5
Economy
58,0
+ 1,5
161,5
- 8,1
93,7
- 5,8
2010
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The Orbis Hotel Group:
financial results 2010
PLN ‘000
2010
2009
Change
Net sales
679 543
694 577
-2,2%
EBITDA
173 186
165 076
4,9%
176
173
1,69%
17 372
4 010
333,2%
EBITDA pro forma
Net profit
• Financial performance of the Hotel Group stabilized. Comparing the results year-toyear one needs to take into consideration 500 rooms withdrawn from operations owing
to hotel closures in the period December 2009 – November 2010.
• Having added 670 new rooms in the economy segment in 2008-2009, Orbis decided
to step back from a few non-strategic locations in 2010. Therefore, revenues of the
Hotel Group reached PLN 680 million, at the 2009 level.
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The Orbis Hotel Group:
financial results of 1Q2011
PLN ‘000
1Q2011
1Q 2010
Change
Net sales
144 488
141 678
2,0%
EBITDA
35 381
22 868
54,7%
EBITDA like-for-like*
23 579
23 778
-0,8%
3 081
- 12 616
-7,5%
Net profit
• The positive trend of the end of the previous year was continued in the first quarter
of 2011. The hospitality market is recovering, yet at different speed in various
locations.
• Hotels in Warsaw continue to lead the upturn, followed by a confident increase in
Tri-city. Still, there are markets which perform at the level of 2010 or lower, notably
Katowice and smaller cities.
*EBITDA like-for-like: after eliminating one-offs (gains from real estate disposals,
costs of restructuring) and without results of hotels closed.
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The Orbis Group:
financial results 2010
PLN ‘000
2010
2009
change
Net sales
818 629
853 922
-4,1%
EBITDA on continued
operations
209 273
229 277
-8,7%
10 758
(6 061)
-
Net profit
• The results of the Orbis Hotel Group in 2010 were determined by the situation of the
global economy and growing competition on hotel markets in Poland, but due to common
efforts of Orbis’ teams the second part of the year has shown an upward trend in
performance.
• The Orbis Group’s revenues in 4Q 2010 were stable at PLN 195 million, the same level
as the year earlier.
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The Orbis Group:
financial results of 1Q2010
PLN ‘000
1Q2011
1Q2010
change
Net sales
173 529
175 514
-1,13%
43 791
30 829
42,04%
0,4
(13 360)
-
EBITDA on continued
operations
Net profit
• Significant EBITDA growth was caused mainly due to gains from disposal of two
hotels in 1Q2011 and successful tapping into positive market trends.
• Financial costs were curbed by PLN 1.2 million owing to repayment of PLN 94 million
of debt in November 2010. As a result, net profit for the first quarter increased by more
than PLN 13 million to 0.4 mln.
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Thank you for your attention.
Contact:
ORBIS SA Investor Relations
Adam Kucza, tel. +48 22 829 39 24, [email protected]
Katarzyna Gronek, tel. + 48 22 829 38 03, [email protected]
You may always find the recent data at:
www.orbis.pl/ir
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