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Hotels group PPHE (LSE:PPH) reported a notable increase in half-yearly profits and maintained its guidance despite facing supply chain challenges that delayed the full opening of new art’hotel properties in London and Rome.
For the six months ending in June, the company saw a 6.7% rise in earnings before interest, taxes, depreciation, and amortization (EBITDA), reaching £48.3 million. Revenue for the period hit a record £191 million, marking a 6.1% increase. Despite these gains, revenue per available room—a key industry metric—dropped 2.2% to £107.8 as prices began to normalize following the Covid-19 pandemic.
PPHE noted that soft openings at the art'otel Hoxton and the Rome Piazza Sallustio properties have been well-received by guests. The company remains optimistic that these properties will contribute significantly, projecting a minimum of £25 million in revenue from them starting next year.
The average room rates softened by 4.4% on a like-for-like basis, attributed to the market mix stabilizing after the high leisure-driven performance of 2023. The company highlighted that while leisure travel continued to be the dominant business segment, rate growth normalized in the first half of 2024. Leisure room rates moderated, though other market segments saw increases.
Corporate travel globally continued to show signs of recovery towards pre-2019 levels, albeit at a slower pace. Forward booking momentum across various segments and geographies remained positive, with particularly strong performance in meetings and events, which supported long-term forecasting.
Overall, PPHE's performance reflects resilience amidst supply chain disruptions and a transitioning market. The company’s proactive approach in managing its property openings and adapting to changing market dynamics suggests a steady outlook for the remainder of the year.