Grupo Posadas, S.A.B. de C.V. & Subsidiaries México City, July 22, 2015

Transcription

1 Operative & Fincial Results: Second Quarter 2015

2 Grupo Posadas, S.A.B. de C.V. & Subsidiaries México City, July 22, 2015 Information presented with respect to the same quarter of last year under IFRS accounting standards: Total revenues and EBITDA grew 17 and 52, respectively Improved maturity profile due to the US$350 million Senior Notes Due 2022 offering Pipeline considers 39 new hotels and 27 additiol rooms to be open during the next 24 months Cash available as of June 30, 2015 of $1,838 million (US$118 million) During the second quarter we continued with an outstanding performance in our hotels system-wide and exceeded by 1.5 times the EBITDA of 2Q14. said Jose Carlos Azcarraga, Posadas CEO 2 > Fincial Highlights Million pesos as of Var Var June 30, Q15 AA 2015 AA Total Revenues EBIT EBITDA 1, , After recording four consecutive quarters exceeding our guidance, we had a very good 2Q15 recording a 52.2 growth in EBITDA vs. 2Q14 results, the Net Debt leverage ratio improved 2.6 times versus the same quarter of previous year and margilly from 1Q15, despite an additiol 41 cent or 2.7 depreciation of the MXN versus the USD during the 2Q15. During the 2Q15 System-wide hotel performance continued improving with better margins. Our Available Daily Rate (ADR) and occupancy increased 4.0 and 3.9 percent points ( pp ) respectively, which resulted in a Revenue Per Available Room (RevPAR) growth of 10.5, that represents a continued improving growth trend on a quarter by quarter basis for the last 13 consecutive quarters. Urban hotels, which represent 81 of the total rooms operated, continue to perform better with an increase in RevPAR of 7.9 and our coastal hotels performed with a RevPAR increase of The net loss of the 2Q15 was of $35.3 million, due mainly to the exchange loss of $109 million as a consequence to the depreciation of the MXN vs. the USD. IR: Gerardo de Prevoisin Tel.: (5255) gerardo.deprevoisin@posadas.com

3 New offering: On June 25, 2015, the successful placement of the US$350 million Senior Unsecured 7NC Senior Notes Due 2022 was concluded. The net proceeds from this offering were mostly used for the repurchase of the majority of the Senior Notes Due It was very gratifying to see the support of investors to the important milestones that Posadas has achieved. Our book was oversubscribed by more than 2.5 times with more than 99 institutiol investors and we maged the lowest interest rate and largest offering in our history, making this offering the most successful ever. After this issuance, Posadas capital structure was strengthened by extending the average life of its debt to 5.9 years. Debt maturity profile As of June 30, 2015: ECP: US$47.2 mm Senior Notes Due 2017: US$40.8 mm Senior Notes Due 2022: US$35 mm Total: US$438.0 mm After giving effect to our liability magement exercise (Proforma 4Q15): Senior Notes Due 2017: US$38.3 mm Senior Notes Due 2022: US$35 mm Total: S$388.3 mm 3 The use of proceeds are as follows: (i) repurchase of of the Senior Notes Due in 2017 in a total consideration of US$295 mm including Tender price and expenses, (ii) US$50 mm Euro-Commercial paper due November 18, 2015 and (iii) US$5 mm for general corporate purposes.

4 > Hotel Development As of June 30, 2015, we continue with an aggressive pipeline comprised of executed agreements to operate 39 new hotels with 5,969 rooms. This development plan represents an increase in capacity of 27. These hotels represent a total investment of US$588 million and of these, 17 will be invested by Posadas and 82 will be invested by third parties. Openings are expected to begin in the third quarter of 2015 and we expect all of these to be operating by June 2017 according to commitments made with the different property owners. The average life to operate these contacts is over 15 years. As we continue with an aggressive openings schedule, during the last twelve months 14 hotels with 1,913 additiol rooms were opened (including 7 conversions to the new format Gamma by Fiesta Inn, four of these run under a franchise model): Gamma de Fiesta Inn Ciudad Obregón, Gamma de Fiesta Inn León, Gamma de Fiesta Inn Tijua, Fiesta Inn Querétaro Centro Sur, The Explorean Cozumel, One Monclova, One León Poliforum, FI Plaza Central, One Cuervaca, Gamma el Castellano Mérida, Gamma Monterrey Ancira, One Villahermosa Tabasco 2000, Gamma Ixtapa and One Celaya. 4 Brands Mexico Total Hotels Rooms Live Aqua Apertura de hoteles (Últimos Doce Meses) No. de cuartos Tipo Fiesta America Grand Tipo Fiesta America FA Vacation Fiesta Inn 10 1, Gamma de Fiesta Inn One hoteles 13 1, Total 39 6, Openings LTM No. of rooms Type of contract GAMMA Ciudad Obregon Gamma León Universidad Gamma Tijua Otay Fiesta Inn Quéretaro Centro Sur The Explorean Cozumel One Monclova One León Poliforum FI Plaza Central One Cuervaca Gamma El Castellano, Mérida Gamma Monterrey Ancira One Villahermosa Tabasco 2000 Gamma Ixtapa One Celaya ,912 Maged Maged Maged Maged Owned Maged Maged Maged Maged Franchise Franchise Maged Franchise Maged

5 > Owned and Leased Hotels 5 2Q15 (QQ) Average Rooms Available Daily Rate Occupancy (Var. in pp) RevPAR Accumulated Average Rooms Available Daily Rate Occupancy (Var. in pp) RevPAR 5,568 1, ,567 1, Total Urban Coastal Var Var Var (0.9) (1.4) ,136 1, ,135 1, (4.8) (5.4) ,432 1, ,440 1,432 1, , During the quarter, revenues from this segment represented 44.8 of the consolidated revenues. The EBITDA margin was 22.4 representing a 3.5pp improvement over the 2Q14. A higher ADR (Average Daily Rate) of 14.5 and a 4.4pp increase in occupancy resulted in a RevPAR increase of Results for urban hotels showed an improvement when compared with 2Q14; on average with 4.8 less rooms owned and leased due to the shift of one leased Fiesta Inn hotel to a maged agreement, a 7.2 increase in ADR and a 5.1pp increase in occupancy, resulted in a RevPAR improvement of With 12.4 more average number of rooms available for coastal hotels due to the transfer of the Fiesta America Cozumel hotel to the all-inclusive format. As a result of more intertiol travelers and the local vacation period of Holy Week, this segment showed an increase in ADR of 26.2 and in occupancy of 1.1pp. As a result of a better mix of rates the RevPAR increased 28.0 when compared with the same period of previous year.

6 > Magement Total Urban Coastal Var Var Var 2Q15 (QQ) Average Rooms Available Daily Rate Occupancy (Var. in pp) RevPAR Accumulated Average Rooms Available Daily Rate Occupancy (Var. in pp) RevPAR 19,819 1, ,742 1, Includes owned, leased, maged and franchised hotels. 16,990 1, ,913 1, The Magement line includes magement and brand services along with our loyalty magement and call center businesses. The operating data under hotel magement is for all the hotels we mage in Mexico. Revenue represented 16.8 of total revenue in the quarter. The EBITDA margin of 30.5 represented a 15.2pp improvement versus 2Q14. The margin increased as a consequence of the continued improvement in the performance of the hotels chain wide ,829 1, ,293 2,829 1, , The average number of rooms operated recorded an 8.2 increase in the quarter, while System-wide hotels reported a 4.0 improvement in ADR, a 3.9pp increase in occupancy, and a RevPAR growth of 10.5 which is similar to the recorded figures of prior quarters. By regions, all over performed versus the same period of previous year. It is worth recalling that the remaining average life of our magement contracts is over ten years. System-wide urban hotels had an increase in the average number of operated rooms of 7.8 with an improvement in ADR of 0.8 and a 4.3pp in occupancy achieving a RevPAR increase of 7.9. Coastal hotels recorded a 10.7 increase in the average number of available rooms after including the FA Cozumel hotel since January 1, In addition, occupancy increased 1.3 while ADR, and RevPar increased 16.2 and 18.4, respectively. The growth observed represents a better rate and occupancy mix.

7 > Vacation Club and Other The Vacation Club and Other business segment primarily includes our vacation properties comprised of the Fiesta America Vacation Club (FAVC), The Front Door and KiVac programs. Revenue for the quarter amounted to 38.4 of the group s consolidated revenues in 2Q15. The contribution margin was 21.0, 4.6 pp higher than the 2Q14 margin, which was propelled by a better pace in the volume of vacation club memberships sales. As of June 30, 2015, the portfolio profile of total receivables which is valued at approximately US$206 million, 9.6 growth since December 31, US$132 million belong to the Fiesta America Vacation Club and reveals its health since 90 of such portfolio falls within the regular collection period of less than 90 days, and the remaining balance is a split between The Front Door and KiVac programs. To continue developing our high-end program, The Front Door, an 84 room facility will be built in Los Cabos to be fully available by mid Meanwhile the Fiesta America Vacation Club Villas located in Acapulco Diamante remains in evaluation phase. > EBITDA 7 In 2Q15 an EBITDA of $324.1 million was recorded, that compares favorably with the $212.9 million recorded in 2Q14 (+52.2). For the last twelve months, EBITDA (IFRS) was $1,258.6 million (US$87.4 million with an average exchange rate of MXN$13.40 per USD). EBITDA adjusted by the sale of a plot of land in Ixtapa and severance payments is $1,279 million that represent a 65 improvement versus the $774 million in 2Q14 LTM. > Capital Expenditures The total consolidated capex was $125.3 million. Hotels and Corporate: Capital expenditures during the quarter were $108.5 million, 75 was used for maintence and refurbishing hotels mainly the Fiesta Inn Aeropuerto hotel in Mexico City- and 25 related to our new corporate offices. The vacation properties capex in 2Q15 was $16.8 million.

8 > Comprehensive Fincial Cost Concept 2Q15 2Q Interest earned Interest expense Fluctuations loss (gain) Other expenses (products) Fincial expenses Total Figures in thousands of pesos. > Net Majority Results (4,894) 111, , , ,268 (8,482) 108,171 (19,148) 0 16,169 96,711 (20,127) 221, , , ,063 (16,177) 205,488 (27,875) 0 28, ,842 At the end of the quarter, considering the effect of IFRS, the net coverage ratio was 3.1 times; 1.4 times higher than the observed in the same quarter of the previous year. The foreign exchange unrealized loss was significant in 2Q15 as the MXN/USD depreciated 2.7 since March 31, As a result of the aforementioned, a net loss of $35.3 million for the quarter was recorded and $81.1 million for the 1H15.

9 > Fincial Position As of June 30, 2015 the cash balance was $1,837.7 million (US$118.1 million with an exchange rate at the end of period of $ per USD). Total assets reached $14,13 million (US$907.7 million). 9 The main uses of cash during the quarter were, among other items: taxes, interests (Senior Notes 2017 coupon), and capital expenditures previously described. Total Debt at the end of the quarter was $6,353.6 million (US$408.1 million), net of issuance expenses, while the Net Debt (IFRS) was $4,515.9 million (US$290 million), the Net Debt to EBITDA ratio was 3.6 times under IFRS, which compares favorably as this ratio was 6.2 times in 2Q14. The Total Debt mix under IFRS at the end of the quarter was as follows: 12 in short-term, 100 in U.S. dollars and with a fixed rate. The average debt maturity was 5.9 years and there was no secured debt outstanding. As of the release date of this report, the existing corporate ratings are: Moody s: global scale B2 with stable outlook. S&P: global B with stable outlook. Fitch: global Issuer Default Rating (IDR) B and local BB+(mex), both with stable outlook. The ratings for the Senior Notes Due 2017 and Senior Notes Due 2022 were: Moody s: B2 / S&P: B / Fitch: B+ RR3. In compliance with article Frac. VIII of the Mexican Stock Exchange rules, Posadas informs that J.P. Morgan Securities LLC, alyst, Jacob Steinfeld jacob.a.steinfeld@jpmorgan.com (1-212) , Bank of America Merrill Lynch, alyst, Roy Yackulic roy.yackulic@baml.com (1-646) and BCP Securities, LLC, alyst: James Harper jharper@bcpsecurities.com (1-203) provide coverage to Grupo Posadas.

10 > Grupo Posadas as of June 30, 2015 Posadas is the leading hotel operator in Mexico that owns, leases, franchises and mages 133 hotels and 22,021 rooms in the most important and visited urban and coastal destitions in Mexico (99 of total rooms) and owns one hotel in the United States (1). 81 of rooms are in urban destitions and 19 in coastal. Posadas operates under the following main brands: Live Aqua, Fiesta America Grand, Fiesta America, The Explorean, Fiesta America Vacation Villas, Fiesta Inn, Gamma by Fiesta Inn and One Hotels. Posadas trades in the MSE since Distribution by rooms Leased Maged Owned Franchise 2,275 rooms 14,295 rooms 4,817 rooms 634 rooms 10 Brand Mexico USA Total Hotels Rooms Hotels Rooms Hotels Rooms Live Aqua Fiesta America 17 4, ,889 Fiesta Inn 62 9, ,091 Gamma 7 1, ,068 FA Vacation Villas 7 1, ,613 One Hotels 36 4, ,438 Other Total , ,

11 > Income Statement IFRS (million pesos) 11 Concept Total Revenues Owned & Leased Hotels Revenues Direct cost Contribution Magement Revenues Direct cost Contribution FA Vacation Revenues Direct cost Contribution 2Q15 1, Q14 1, Var (15.8) , , , , , , , Var Corporate expenses Depreciation / amortization Asset impairment Other expenses (revenue) Operating Profit (21.7) (1.3) (31.7) (2.2) (31.5) (29.8) (0.9) (8.9) (0.3) (3.3) EBITDA Comprehensive fincing cost Profit Before Taxes & Assoc. Co. Part. in results of Associated Co. Profit Before Taxes Discontinued Operations Income taxes Deferred taxes (6.6) (2.5) 64.6 (44.0) 13.8 (0.4) (0.2) 3.9 (2.6) 96.7 () 16.3 (7.2) 24.2 (19.7) 6.8 () 1.2 (0.5) 1.7 (1.4) (3.4) 13.7 (0.3) (0.1) (22.4) (6.7) 96.3 (103.5) 6.9 (0.8) (0.2) 3.5 (3.7) (96.7) Net Income before Minority Minority Interest Net Majority Income (29.7) 5.6 (35.3) (1.8) 0.3 (2.1) 19.0 (1.5) (0.1) 1.4 (84.3) (3.2) (81.1) (2.5) (0.1) (2.4) (8.6) (0.6) (8.0) (0.3) () (0.3)

12 > Consolidated Balance Sheet as of June 30, 2015 & December 31, IFRS (million pesos) Concept Jun - 15 Dec-14 Var. 12 ASSETS Current Cash & investments Short term investments Notes & accounts receivable Inventories Other assets Total current assets Long Term Accounts and notes receivable Investments in shares & other investments Property, plant and equipment, net Intangible and deferred assets Other Non current assets Total Assets LIABILITIES Current Suppliers Bank loans Stock market loans Taxes and Other Other current liabilities Total current liabilities 1, , , , , , , , , , , , , , , , , , (13.3) 9.6 (16.1) (49.3) 38.8 (6.2) (8.7) Long Term Bank loans Stock market loans Other liabilities Deferred tax liabilities and Other Total Liabilities - 5, , , , , (23.6) 9.9 STOCKHOLDERS EQUITY Majority interest Minority interest Total Total Liabilities & Stockholders Equity 3, , , , , , (2.1) (8.1) (2.4) 6.1

13 > Consolidated Cash Flow Statement - IFRS (Million pesos from January 1st to June 30, 2015 & 2014) Consolidated Net Income Before Taxes + (-) Items not requiring cash + (-) Other unrealized items + (-) Entries related to Investments + Asset impairment, Depreciation and amortization for the year + (-) Gain or loss on sale of property, plant and equipment + (-) Equity in results of associates and joint ventures (-) Interest income +(-) Other items +(-) Items related to fincing activities + Accrued interest + (-) Currency fluctuations + Derivatives Cash before taxes Cash flow provided or used in operation + (-) Decrease (increase) in accounts receivable + (-) Decrease (increase) in inventories + (-) Decrease (increase) in other accounts receivables and other assets + (-) Increase (decrease) in suppliers + (-) Increase (decrease) in other liabilities + (-) Income taxes paid or returned Net cash flows from operation Net cash flow from investing activities (-) Permanente investments (-) Investment in property, plant and equipment + Business sales (-) Interests received + (-) Other items Net cash from fincing activities Net cash flows + Bank fincing + Stock market fincing + Other fincing, includes margin calls (-) Bank and stock market fincing amortization (-) Other fincing amortization + (-) Increase (decrease) in equity (-) Dividends paid + Premium on issuance of shares + Contribution for future capital increases (-) Interest expense (-) Repurchase of shares + (-) Other items 11.5 (23.8) (23.8) (20.1) (225.0) (318.1) 51.7 (70.4) (411.3) (319.3) 69.1 (207.1) (2.6) 20.1 (198.8) ,448.7 (4,942.2) (185.1) (3.3) (22.4) (43.1) (43.1) (16.2) (27.9) (417.7) (37.1) (3.6) (16.7) (433.2) (97.0) (209.7) (292.5) (306.8) (169.6) 44.9 (8.0) (217.5) 10.9 (0.1) Net increase (decrease) in cash and cash equivalents Changes Cash and cash equivalents at the begining of period Cash and cash equivalents at the end of period ,387.7 (476.4) 1, For more information visit