PPHE Hotel's revenues rise boosted by weak pound

AIM-listed PPHE Hotel Group’s revenue rose due to the favourable euro/sterling exchange rate, with the hotel operator telling investors it expects trading to be in line with current expectations.

In an update for the three months ended 30 September, like-for-like revenue increased by 9.3% to £92.7m while reported total revenue rose by 61.5% to £93.2m due to the consolidation of the results of its hotel in Croatia.

The average LFL room rate was up by 11.5% to £113.30 and on a reported basis, average room rate climbed by 0.9% to £113.40.

LFL occupancy was flat at 85.6%, while reported occupancy decreased by 500 basis points to 84% due to a new rate-focused strategy for several hotels in Germany.

Revenue per available room LFL increased by 11.3% to £97, whereas reported revenue per available room decreased by 4.8% to £95.30 due to the Croatian hotel acquisition.

Meanwhile, LFL revenue climbed 4.3% to £204.2m, for the nine months ended 30 September, and total reported revenue increased by 28.1% to £204.8m.

The company said that the fourth quarter is usually the strongest trading period for its operating regions, excluding the Croatia operations which are highly seasonal, and trading since the end of September has remained encouraging while it prepares to launch several new hotels.

President and chief executive, Boris Ivesha, said the company’s overall performance benefited from the favourable euro to sterling exchange rate.

He added: “Our new hotel Park Plaza Nuremberg has now fully opened and we are on target for a soft opening of our two new London hotels in the final quarter of 2016, as well as the completion of the extension and reconfiguration of Park Plaza Riverbank London.

“Our London inventory is expected to increase by over 800 rooms once these projects have been completed.”

The interim dividend of 10p per share was paid on 7 October.

Shares in PPHE Hotel Group were up 0.72% to 695p at 0957 GMT.