2007: Good Financial Results for Steigenberger
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2007: Good Financial Results for Steigenberger
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Category: Worldwide - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2008-05-16
The Steigenberger Hotel Group brought the last financial year to a successful conclusion. Against the backdrop of a positive economic climate and despite the lack of any lasting effect from the Football World Cup, the Frankfurt-based hotel group increased its turnover, its occupancy rates and its average room rate. The average occupancy rate increased by 0.8 percentage points to 64.5 percent, the room rate improved by 3.3 percent to 85.47 Euros and the yield went up 3.9 percent to 55.44 Euros. Overall the turnover of the Steigenberger Hotel Group rose by 5.6 percent to 484.4 million Euros.
Once again the Steigenberger Hotel Group was able to report on another successful financial year as it presented its latest set of annual results in Frankfurt am Main. The company fulfilled its expectations even without the exceptional effect generated by the Football World Cup of 2006. The number of overnight stays rose from 3.0 million to around 3.3 million.
In the course of the year the turnover of the Steigenberger Hotel Group increased by 25.7 million Euros or 5.6 percent from 458.7 million Euros to 484.4 million Euros. The average occupancy rate rose by 0.8 percentage points to 64.5 percent.
In the core hotel business the hotels of the Steigenberger Group showed an increase in turnover of 3.9 million Euros, with the overall turnover rising 1.1 percent to 360.5 million Euros. Of particular note was a price-driven increase of revenue from accommodation, up 2.5 percent on the previous year.
The average room rate also continued its positive development in the 2007 financial year. At 85.47 Euros it showed an increase of 3.3 percent or 2.74 Euros. As a result the room yield (RevPar), which measures the revenue per available room, went up by 3.9 percent or 2.10 Euros compared with the previous year to 55.44 Euros.
The GOP (Gross Operating Profit) - the measurement of operative success within the group – saw a disproportionate rise in the course of the financial year compared to the rise in turnover. The hotels achieved a GOP in the region of 105.4 million Euros as opposed to 103 million Euros the previous year (a rise of 2.3 percent). The improved profitability of the company manifested itself in an increased share of the GOP coming from sales revenue, which rose from 28.9 percent to 29.2 percent; a rise of 0.3 percentage points.
The company’s earnings before interest, taxes, depreciation and amortization (EBITDA) saw a clear rise of 64.6 percent to 15.8 million Euros (previous year: 9.6 million Euros). The EBIT reached 6.7 million Euros in 2007, or 2.4 percent of the sales revenue (previous year: 2.0 million Euros). The company took advantage of these positive results to extend its risk provisioning. The company’s annual surplus amounted to 0.2 million Euros, as opposed to 0.4 million Euros in 2006.
In the year under review, investments came to 44.7 million Euros (previous year: 31.2 million Euros). The investment programme, which began in 2005 with 150 million Euros and was due to run until 2008, has now been increased to 250 million Euros and extended until 2010.
In the past year extensive alterations have been carried out in the Steigenberger Airport Hotel at Frankfurt Airport and in the Steigenberger Belvédère in Davos (Switzerland). Planning work is already well underway for the hotels in Baden-Baden, Duisburg and Berlin and in some cases building work has already started.
The company’s high volume of investment was financed entirely out of the operative cashflow and from shareholder investment grants for the work on the Steigenberger Airport Hotel at Frankfurt Airport. Despite the high financing demands the company was able to report for the first time on 31 December 2007 that it no longer had any net indebtedness; in other words, cash resources exceeded all financial debts.
One important factor in the success of the past year was the introduction of a new resort hotel concept, consisting of improved services, a more extensive gastronomic range or carefully tailored sports, cultural and wellness programmes. A key element here was the investment that has been made in the hotel rooms themselves and in the spa and wellness areas.
Sales and marketing activities were expanded towards the end of 2007. A significant factor here was the changeover to a new international distributor, Pegasus Solutions, one of the global leaders in the hotel industry. The new distribution strategy has been designed to create a distribution platform that serves all hotels of the Steigenberger Hotel Group in equal measure. Following this change, the new Global Sales Structure that was introduced three years ago on a domestic level has been reorganised and expanded to operate at an international level.
Expansion is also the watchword for Steigenberger and InterCityHotels in 2008. After last year’s addition to the portfolio of the Steigenberger Nile Palace in Luxor (Egypt), this year four new hotels are due for inclusion. The InterCityHotel Dresden is already up and running, to be followed in August by the InterCityHotel Essen and in November by the InterCityHotel Mainz while at the end of the year an elegant city hotel will be opening its doors in the form of the Steigenberger Hotel Herrenhof in Vienna (Austria).
In 2009 a new InterCityHotel is due to open in Hannover and 2010 will mark the opening of the InterCityHotel Berlin Airport at Schönefeld. The Steigenberger Hotels and Resorts will gain a new hotel on the island of Usedom: the Steigenberger Hotel Kaiserbad in Heringsdorf will be ready to receive its first guests in 2010.
This year, the corporate strategy will continue to develop along the tried and tested lines of the Steigenberger Hotel Group. The objective is to position the company successfully in Germany and on an international level in the years to come. The Steigenberger Hotel Group is starting the 2008 financial year on a stable business footing.
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