Design Hotels AG

Design Hotels AG publishes Annual Results 2018

Business news for the stock market

Berlin, March 29, 2019 (pta010/29.03.2019/08:05) - Design Hotel AG (m:access, Munich: LBA; ISIN: DE0005141006) publishes the results for the financial year 2018. Revenue increased by about 7% and is above the expectations set forth in the beginning and middle of the year 2018. The operational result increased by 17% compared to the previous year and, therefore, exceeds the expected result.

Key Financials:

Total Revenue increased by about 7% Euro 24.548m (22.921) in 2018. The main driver for this increase were the transaction fees.

Revenue from License Fees for membership with Design Hotels increased by 5% to Euro 4.398m (4.202). This contributes 18% (18) to total revenue. On December 31, 2018, Design Hotels had 327 (309) member hotels in its portfolio with 22,144 (21,143) rooms in 233 destinations and 62 countries.

Transaction Fees came in at Euro 14.708m (13.230) in 2018, which means a 11% increase compared to the previous year. Commissions accounted for 60% (58) of the total revenue. The disproportionally high increase mainly comes from bookings through the Starwood booking channels in the scope of the SPG-program, which have been integrated into the Marriott platform in the meantime.

Revenue from Marketing and Consulting Services decreased by 1% in 2018 and reached Euro 5.442m (5.489). It accounts for 22% (24) of total revenue. The company had decided to reduce the offering of low-margin products to its member hotels.

The Gross Margin was at last year's level and came in at 57% (57). Gross Revenue was Euro 14.035m (13.090), which is an increase of about 7% compared to the previous year. The increase is proportionate to the total revenue increase.

Despite an increased business volume, the average number of employees remained at almost 90. Staff Expenses grew by about 3% from Euro 6.730m to Euro 6.960m, mainly because of bonus payments. At the same time, Revenue per Employee went up from about Euro 244,000 to about Euro 273,000.

Selling Expenses came in at Euro 1.336m (1.412).The decrease of the selling expenses was mainly due to strategy changes in search engine advertisement.

Other Operating Expenses increased to Euro 1.687 (1.613) compared to the previous year. This increase mainly comes from higher allowances on trade receivables and foreign currency exchange losses.

EBITDA increased by 17% to Euro 3.576m (3.055) in 2018. The EBITDA margin was 15% (13). EBIT reached Euro 3.199m (2.649) in 2018. Net Profit came in at Euro 3.241m (2.694).

On December 31, 2018, the Company had cash and cash equivalents in the amount of Euro 1.408m, as compared to Euro 1.755m on December 31, 2017. The Management Board assumes that in 2019, all payment obligations arising from the current operations can be covered by the cash inflows from operating activities.