EasyHotel in line with expectations with a pipeline of new hotels
EasyHotel is trading in line with expectations as the market improved in the last two months of 2016, while the budget hotel operator plans to open further hotels during 2017.
FTSE AIM All-Share
Travel & Leisure
The AIM-listed company said for the year ended 30 September the company had made “good progress” and is in line with expectations for both its owned and franchised hotels, and remains on track to deliver its development strategy.
EasyHotel is investing in a new hotel management system, as part of its development strategy to improve efficiency and enable to maximise income. The integrated and automated system, provided by Hetras, will be rolled out to all owned and franchise hotels in the coming months.
Chief executive Guy Parsons, said the UK hotel market improved in November and December with revenue per available room growing in both months compared with 2015, while owned hotels have “continued to outperform the general market and their individual competitive set”, as measured by STR Global, the industry benchmark. A similar market improvement has been experienced across much of continental Europe and its franchise hotels are performing in line with their respective markets.
He said: "We remain on track to open eight new hotels, four owned and four franchised, in the current financial year and continue to make good progress in adding new projects to our development pipeline. Trading is in line with our expectations and we remain focused on implementation of our strategy as we continue to extend our footprint and establish easyHotel as the leading super budget hotel chain."
New hotel projects are under construction across the UK with EasyHotel Birmingham due to open later this week, and hotels in Liverpool and Manchester opening in March and in Ipswich during the summer.
In December, the company conditionally bought long leasehold properties in Sheffield and Leeds, to be opened in 2018, and subject to obtaining planning permission.
Recently, planning permission was granted for a 204-room new hotel in Barcelona on Gran Via, on the main avenue of L'Hospitalet de Lllobregat, due to open in 2018. A 15-year,€8.25m bank facility was secured in January to part-fund development of the project, and will be due in 2032 with interest at Euribor +2.25%.
In the later half of the 2016 calendar year the company has also opened two franchise hotels in Brussles and Amsterdam, adding a further 238 rooms to its network.
The company plans to open two further franchise hotels, a 54-room hotel in Reading and an 81-room hotel in Belfast, its first in Northern Ireland, both of which are expected to open in the next financial year.
Currently, EasyHotel has 1,833 rooms under development, 801 of which are owned and 1,032 are being developed by franchise partners.
The company also sold a site in Ipswich under a 999-year leasehold agreement for £140,000, which will be converted into a coffee shop. EasyHotel bought the freehold of the building last January for £800,000.