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Rezidor Hotel Group AB FY 2010. Mars 2011. Top 10 Hotels Players in Europe Rezidor ranks 5 th in number of rooms, first on the upscale segment (with its brand Radisson Blu ). As of Dec. 2010. (1) . Only Midscale. (1) . (1) . Resort. (1) . Resort. (1) . Only UK. - PowerPoint PPT Presentation
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Sources: MKG Hospitality – Feb. 2011, Companies annual reports 2010 and corporate website(1) Nb of rooms based on internal estimates
Rank 2010 Group Hotel Network
1 Accor 2,368 h. 260 kr.
2 Best Western 1,360 h. 93 kr.
3 Intercontinental 590 h. 92 kr.
4 Louvre Hotels 947 h. 67 kr.
5 Rezidor 276 h. 57 kr.
6 NH Hoteles 361 h. 52 kr.
7 Sol Melia 214 h. 47 kr.
8 TUI 182 h. 46 kr.
9 Hilton Worldwide 193 h. 45 kr.
10 Whitbread PLC 592 h. 43 kr.
Top 10 Hotels Players in EuropeRezidor ranks 5th in number of rooms, first on the upscale segment (with its brand Radisson Blu)
As of Dec. 2010
Only Midscale
Resort
Resort
Only UK
(1)
(1)
(1)
(1)
(1)
2
3Rezidor – Company profile
FY 2010
Rezidor Hotel Group AB.Summary
1. Company overview Slide 3
2. Company organization Slide 4
3. Brands positioning Slide 5
4. Geographical breakdown Slide 6
5. Operating mode Slide 7
6. Group strategy Slide 8
7. Pipeline and lodging development Slide 10
8. Key figures Slide 11
9. SWOT analysis Slide 13
10. Company history Slide 14
11. Brands description Slide 15
4Rezidor – Company profile
FY 2010
1. Company overview
– Rezidor is a Hospitality Swedish company operating in the traditional lodging industry
– Three main brands: Radisson Blu, Park Inn by Radisson and Hotel Missoni
– Asset-light business model– 4,947 employees
– Fifth hotel player in Europe (in nb of rooms)– Radisson: largest upscale hotel brand, according to
MKG– Segmented portfolio: Luxury/Lifestyle (Hotel Missoni),
Upscale (Radisson Blu), Midscale (Park Inn by Radisson), Limited service (Country Inn)
– Presence in 48 countries through EMEA – Radisson Blu and Park Inn by Radisson developed in
EMEA under Master Franchise Agreements with Carlson
Description– Listed on the NASDAQ OMX Stockholm Exchange on
November 2006
Main Figures Segmental Revenue and EBITDARevenue
51%
43%
3%3%
Eastern EuropeMEA
Nordic Europe(2)
Western Europe
Sources: Reuters as of 28 April 2011, Rezidor Annual Report 2010, Rezidor website
EBITDA (1)
55%
22%
23%
Eastern EuropeMEA
Nordic Europe (2)
Western Europe
(1) Excluding Western Europe negative EBITDA (-€4.6m)
(2) Incl. Denmark, Finland, Iceland, Norway and Sweden
Main Shareholders
Owners Stake
Float 49%
Carlson Companies 50%Nordea Investment Management 12%
Swedbank 7%
# rooms
Mid/Ups 312 66,375
# hotels
62.3% 99.5€ 62€ADROR Revpar
segment
2009 2010 2011E 2012EFinancials (M€)
Revenue 677 786 871 942% Change in Revenue -13.8% 16.1% 10.8% 8.2%
EBITDA 5 32 64 111EBITDA margin 0.7% 4.1% 7.3% 11.8%
Net Profit -28 -3 23 48Net margin NA NA 2.6% 5.1%
Market Data (M€)Market Cap 718
NetworkHotels 286 312Rooms 60,646 66,375
Market Data as of April 28, 2011
5Rezidor – Company profile
FY 2010
2. Company organizationGroup companies and legal structures
Rezidor Hotel Group AB(Sweden)
Rezidor Hotel Holding AB(Sweden)
RezidorRegent A/S(Denmark)
Rezidor LoyaltyManagement A/S
(Denmark)
RezidorLifestyle A/S
(Denmark)
RezidorPark ApS(Denmark)
Rezidor Hospitality A/S(Denmark)
RezidorCountry A/S(Denmark)
RezidorSweden AB
(Sweden)
Rezidor HotelsApS Danmark
(Denmark)
RezidorComerstone A/S
(Denmark)
Rezidor HospitalityNorway AS
(Norway)
RezidorRussia A/S(Denmark)
100% shares and votes
100% shares and votes
100% shares and votes
100%100% 100% 100% 100%
100% 100% 100% 100% 100%
Sources: Company reports
6Rezidor – Company profile
FY 2010
3. Brand positioning
Source: Rezidor Annual Report 2010
NB: 6 Regent hotels included in Other hotels in Annual Report
(1) 2 Country Inn hotels in EMEA (Germany and Austria)
Full Service
Midscale(% of room network)
Luxury(% of room network)
Economy(% of room network)
Limited Service
Upscale(% of room network)
103 h. / 19,232 r. / 26 c.
200 h. / 46,122 r. / 48 c.
1 h. / 136 r. / 1 c.
2 h. / 133 r. / 2 c.
(2)
(1)
Hotels / rooms / countries
7Rezidor – Company profile
FY 2010
4. Geographical breakdown
60 h15,071r
WesternEurope
160 h29,406r
Nordic Europe 56h12,945r
Eastern Europe
Middle-East, Africa & Others36 h
8,953r
Hotel and room networkAs of December 31st, 2010
312 h, 66,375 r
Source: Rezidor Annual Report 2010
44%
20%
23%
13%
X%
Share ofglobalnetwork (in nb of r)
8Rezidor – Company profile
FY 2010
5. Operating mode
2002133 h. / 28,900 r.
2010312 h. / 66,375 r.
29%
1%
29%
41% 54%
26%20%
FranchisedOwned Leased Managed
Source: Rezidor Annual Report 2002 & 2010
+37,745 rooms+130% over 8 years
9Rezidor – Company profile
FY 2010Source: Rezidor Annual Report 2010
Park Inn by Radisson– New name launched in Q2 2010– Link with Radisson’s brand image to enhance further growth
Sale of Regent– Positive effect of M€ 5.7– Management services still provided to Regent hotels after sale
Portfolio agreement in the Baltics– Agreement to re-brand 10 Reval hotels (ca 2,400 rooms) in the Baltics to Radisson Blu and
Park Inn– Agreement to strengthen Rezidor’s position in the key markets Riga, Tallinn and Vilnius
Carlson’s shareholding– Carlson, Rezidor’s major shareholder, has increased its shareholding to 50.03% of the
registered shares in May 2010
6. Group strategyImportant developments of the year
M&A
Development strategy
Brand strategy
Ownership
10Rezidor – Company profile
FY 2010Sources: Rezidor Annual Report 2010
*Press review as of March, 2011
Margin improvement: EBITDA target margin of 12%– Tight cost control (following the cost reduction program of 2009)– Substantial increase in cash flow in 2010 allows increase in maintenance Capex– Fixed-lease structure to be maintained in Western Europe
Asset light strategy– Increasing proportion of managed and franchised hotels (95% of the pipeline vs. 74% of the actual
portfolio)– Hotels conversions privileged in some specific markets such as UK, Germany and Russia for Park Inn
brand, while Radisson Blu expansion mainly through new builds
Focus on expansion of core brands: Radisson Blu, Park Inn by Radisson– Disposal of peripheral assets: sale of Regent luxury brand to Formosa in April 2010– Key priority to boost brand awareness as a mean to increase RevPar penetration: new name for Park
Inn followed by a major new marketing and sales campaign in 2011, mainly in UK
Expansion plans in emerging countries– Focus on Russia/CIS and Africa: strong economic growth, undersupply or old inventory combined with
high room demand and low operating costs– Emerging markets represent over 70% of the pipeline (vs. 36% of rooms in operation)– Radisson Blu: key to entering new markets, Park Inn usually following the footsteps of Radisson Blu– Rezidor is considering to enter the economic segment in Middle East, Russia and Africa under a new
brand*.
6. Group strategyStrategic axes
11Rezidor – Company profile
FY 2010
7. Pipeline and lodging development
Source: Rezidor Annual Report 2010
Pipeline 2011-2015 : 21,493 additional rooms (32% of the current network), incl. 8100 new rooms signed in 2010
20%
9%
37%
34%
Eastern EuropeMEA
Nordic EuropeWestern Europe
34%
63%
3%
88%
4%8%
Missoni
RadissonPark Inn
Franchised
LeasedManaged
Per region Per brand Per contract type
Business Development in 2010• Openings: +7,173 r. (32 h.)
• Closings: -1,444 r. (6 h.)
• Net evolution: +5,279 r. (+9,4%)
Focus on Eastern Europe and MEA
Two core brands: Radisson Blu and Park Inn
by Radisson
+95% current pipeline managed & franchised
12Rezidor – Company profile
FY 2010
8. Key figuresP&L evolution & forecasts
-3%
-1%
1%
3%
5%
7%
9%
11%
13%
15%
0
100
200
300
400
500
600
700
800
900
1 000
2003A 2004A 2005A 2006A 2007A 2008A 2009A 2010A 2011E 2012E
Revenue EBITDA margin Net margin
Financials (in M€) 2003A 2004A 2005A 2006A 2007A 2008A 2009A 2010A 2011E 2012E CAGR 2003-2010
Revenue 390 499 587 707 785 785 677 786 871 942 10,5%% Change in Revenue NA 27,9% 17,6% 20,4% 11,0% 0,0% -13,8% 16,1% 10,8% 8,2%
EBITDA (12) 21 44 51 81 70 5 32 64 111 NAEBITDA margin NA 4,2% 7,5% 7,2% 10,3% 8,9% 0,7% 4,1% 7,3% 11,8%
Net Profit (33) 4 18 21 46 26 (28) (3) 23 48 NANet margin NA 0,8% 3,1% 3,0% 5,9% 3,3% NA NA 2,6% 5,1%
Sources: company reports and Reuters consensus estimates as of March 16, 2011
13Rezidor – Company profile
FY 2010
– Strong support of the worldwide group Carlson, which owns 50.1% of the company
– Large product range, from midscale to luxury– Large brand awareness in Scandinavia– Leadership in Scandinavia– Good business model (upscale with maximum
pricing power, strong operating leverage, no debt, well positioned to win management contracts)
Strength
– Geographical footprint limited to EMEA– Expensive lease commitments– Dependence on Carlson– Poor business control, especially as Rezidor
pursues an aggressive growth plan– Bad ratings in customer satisfaction surveys– Difficulties in securing new hotel contracts or
keeping/prolonging maturing contracts
Weaknesses
– Improving business mix (asset light management contracts)
– Well positioned for recovery, thanks to costs measures implemented in 2009
– Growing share of the branded hotels trend for conversion from unbranded to branded hotels
– Strong room rollout potential– Central and Eastern Europe as one of the
world’s fastest emerging travel markets
Opportunities
– Intense competition, with a large number of players, especially in Europe
Threats
9. SWOT analysis
Source: Broker research, June 2010
14Rezidor – Company profile
FY 2010
10. Company history
Source: Rezidor Website
Scandinavian Airlines founds the company SAS International Hotels by opening its first hotel, the SAS Royal Hotel in Copenhagen1960
1980 First hotel outside Scandinavia: SAS Hotel Kuwait
1994 First master franchise agreement with CarlsonRadisson SAS is born
2001 SAS International Hotel becomes Rezidor
2002 Multi brand franchised master agreement, adding 3 other Carlson’s brands to Rezidor Portfolio: Regent, Park Inn and Country Inn
2005 Hotel Missoni is launched, in partnership with the Italian fashion brand of the same name
2006 Rezidor goes public on the Stockholm Stock Exchange
2009 Radisson SAS becomes Radisson Blu
2010 Sale of Regent Hotels to Formosa
15Rezidor – Company profile
FY 2010
Hotel Missoni
Radisson
Park Inn by Radisson
Source: Rezidor Annual Report 2010
11. Brands description
Limited Service Country Inn
Full Service
16Rezidor – Company profile
FY 2010
Overview
Full service, upper upscale brand ►Focusing on lifestyle and design aspects►License agreement with the italian fashion house
of the same name►Woldwide licensing agreement►First Hotel opening in 2009
Main competitors► So by Sofitel, W, Morgans, Malmaison, Bulgari,
Armani
Network
Network►2 hotels, 305 r. (incl. newly opened Missoni
Kuwait City)►Pipeline = 3 hotels / 508 rooms
Locations► Fashionable cities as well as in up-and-coming
resort areas
►Geographical breakdown►Worldwide, with a focus on Europe and the
Middle East►Two hotels operated in Edinburgh and Kuwait►Future openings include Oman, South Africa,
Brazil
11. Brands descriptionFull service – Hotel Missoni
Source: Rezidor Website
17Rezidor – Company profile
FY 2010
Overview
Full service, upscale brand ►Largest Rezidor hotel brand ►Largest upscale hotel brand in Europe►Ranging from small boutique hotels to major city
landmarks►Managed / Leased contracts►Trademark of Carlson, master franchise agreement
with Carlson until 2032, with the option to extend the agreement until 2052
New architecture and design policy►Rebranded as Radisson Blu in 2009
Key figuresFY 2010►ADR: €110.3►RevPar: €70.5►Occupancy Rate: 63.9%
Main competitors► Pullman, Hilton, Marriott H&R, Sheraton
Network
Network►200 hotels / 46,122 rooms in operation
= 230 rooms per hotel on average►Pipeline: 52 hotels / 12,922 rooms
Locations► Mainly located in city centers, leisure resorts
and airports
FY 2009► ADR: €105.95►RevPar: €65.9►Occupancy Rate: 62.2%
11. Brands descriptionFull service – Radisson Blu
Source: Rezidor Annual Report 2010, Rezidor Website
18Rezidor – Company profile
FY 2010
Overview
Full service, midscale brand►New name to be used from January 2011: Park Inn
by Radisson►Mainly operated under franchise agreements ►Targeted markets: UK, Germany and Russia
(growth mainly driven by conversion)►Trademark of Carlson, master franchise agreement
with Carlson until 2032, with the option to extend the agreement until 2052
Key figuresFY 2010►ADR: €64.5►RevPar: €37.5►Occupancy Rate: 58.0%
Main competitors► Novotel, Scandic, Holiday Inn
Network
Network►87 hotels / 16,121 rooms in operation
= 185 rooms per hotel on average►Pipeline = 51 hotels / 9,408 rooms
Locations►City centers, suburban locations and transport
terminals
FY 2009► ADR: €63.8►RevPar: €33.6►Occupancy Rate: 52.6%
11. Brands descriptionFull service – Park Inn (1/2)
Source: Rezidor Annual Report 2010, Rezidor Website
Park Inn by Radisson is a “fresh and energetic” midscale hotel brand (119 hotels / 85% in Europe) Relaunched in 2003, stand-alone brand until 2010, when an affiliation to Radisson was decided (starting Jan 2011) New name is in line with Rezidor decision to focus its dvlp on its two core brands, Radisson and Park Inn Objectives : The link with Radisson and its great strength and reputation will allow Park Inn to grow faster and to
increase the brand awareness. But no repositioning / upgrade seems to be planned. Implementation Plan :
– The rebranding process will start in Park Inn’s key home market, the United Kingdom, before extending the process across Europe, Middle East and Africa.
– The transition of Park Inn hotels to Park Inn by Radisson will be completed by the end of 2011.– First Park Inn by Radisson in Brazil, developed by Atlantica Hotels International
Pipeline1 : 41 in EMEA, 3 in North America , 2 in APAC (India), 2 in Latin America
19
11. Brands description Park Inn (2/2) : affiliation brand strategy case study
2000 2002 2010
• Carlson acquires the Park Inn brand from Olympus Hospitality Group
• Rebranding operation to Park Inn by Radisson to enhance further growth
• Carlson signs a master franchise agreement with The Rezidor Hotel Group to develop Park Inn in EMEA
2003
• Rezidor relaunches Park Inn. First hotel in Berlin
1 Lodging Econometrics Q4 2010
20Rezidor – Company profile
FY 2010
Overview
Limited service, economy brand► Brand under development, currently under review
by Rezidor►Trademark of Carlson, master franchise agreement
with Carlson until 2032, with the option to extend the agreement until 2052
Main competitors► Ibis
Network
Network►2 hotels / 133 rooms in operation
Geographical Breakdown►Germany►Austria
11. Brands descriptionLimited service – Country Inn
Source: Rezidor Annual Report 2010, Rezidor Website
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