Hoteles City Express Announces Results for 4th Quarter with 13.6% growth in ADR and Adjusted EBITDA increase of 16.1%

MEXICO CITY, Feb. 15, 2017 /PRNewswire/ -- Hoteles City Express S.A.B. de C.V. (BMV: HCITY) ("Hoteles City Express" or "the Company"), announced today its results for the fourth quarter ("4Q16") and full year 2016 ("12M16").  The figures within have been prepared in accordance with International Financial Reporting Standards ("IFRS") and are presented in Mexican Pesos ("$")

Financial and Operating Highlights (4Q16)

• At the Chain level, 4Q16 occupancy reached 61.5%; 240 basis points ("pbs") below the same period last year due to the opening of 8 new hotels in the quarter. The Average Daily Rate ("ADR") and Revenue per Available Room ("RevPAR") increased by 13.6% and 9.3%, respectively, in comparison with 4Q15, to $885 and $544.
• Total Revenues were $551.7 million, which represents an 18.3% year-on-year increase, primarily due to a 9.3% increase in the number of Occupied Room Nights at the Chain level, as well as a 13.6% increase in RevPAR.
• Operating income was $102.4 million in 4Q16; a 7.6% increase over the same quarter last year.
• EBITDA and Adjusted EBITDA were $173.8 million and $180.5 million, respectively, reflecting year on year increases of 13.9% and 16.1%. EBITDA margin and Adjusted EBITDA margin for the period came to 31.5% and 32.7%, respectively.
• Net Income for the period reached $79.1 million; a 98.3% year on year increase. Net Income margin was 14.3% for the quarter.
• At the close of the fourth quarter 2016, the Chain was operating 123 hotels; an increase of 17 new units compared to the 106 hotels operating at the close of the same period in 2015. The number of rooms in operation in 4Q16 was 13,702; a 14.7% increase in comparison with the 11,944 at the close of 4Q15.

Financial and Operating Highlights (12M16)

• At the Chain level, occupancy for the year closed at 61.7%, with an ADR of $842 and RevPAR of $519, reflecting increases of 9.8% and 9.3%, respectively.
• Consolidated Total Revenues as of December 2016 were $2.04 billion; an 18.6% increase with respect to the same period in 2015. This was due to an 11.0% increase in the number of Occupied Room Nights at the Chain level, a 9.3% increase in RevPAR and to a 42.4% increase in revenues from Hotel Management activity.
• Operating Income registered $372.0 million during 2016; a 16.1% increase over 2015.
• EBITDA and Adjusted EBITDA reached $663.4 million and $681.5 million, representing year on year increases of 15.9% and 17.2%, respectively. EBITDA and Adjusted EBITDA Margins were 32.6% and 33.4%, respectively.
• Net Income for the period reached $264.5 million; a 26.7% year on year increase. Net Income Margin was 13.0% at the close of 2016.

Comments by Luis Barrios, Chief Executive Officer of Hoteles City Express:

"With more than 13,800 rooms and 124 hotels to date, an intense commercial strategy and a digital distribution platform that is beginning to show results, Hoteles City Express closes another record year in the history of the Company.

During 2016, we achieved excellent operational performance, productivity and profitability metrics, including: a) a 16% increase in installed capacity during the year, b) an increase of close to 10% in RevPAR and c) an Adjusted EBITDA margin in line with last year with 15% more nights in operation.

Regarding our Development Plan, 2016 represented a landmark of growth in new units. With more than 1,750 rooms and 17 new hotels in deep markets we have an inventory available to serve more than 3.0 million guests per year.

Even though the general outlook for the Mexican economy is showing signs of uncertainty for 2017, the demand indicators for the tourism sector remain solid and fundamentally well underpinned. In particular, the dynamism of airport passenger and hotel activity in the most important markets where we operate continues to grow in a healthy way.

For 2017, we will maintain our pace of growth and continue to increase our exposure in attractive markets, diversifying our portfolio and applying a cautious approach to our investments based on the Mexican economy's performance throughout the different industries and regions. We are confident that our capacity in this area together with our cost control discipline over the development process will lead us to open more than 2,000 new rooms in 19 new units in 2017 - 17 new hotels and 2 expansions to existing hotels.

Finally, it is worth mentioning that stronger efforts over the last 18 months regarding the implementation of an "online operation" culture, a process-driven organization and our e-commerce engine are beginning to show results by demonstrating scale and allowing us to rely on an adaptive and real-time commercial strategy.

Today, Hoteles City Express is much more than an asset portfolio, it is an integrated hospitality platform with the greatest potential to sell and operate rooms in Mexico and the rest of Latin America.

We are proud of our results, which reaffirm our strong competitive position and enable us to continue being an alternative value generator for all our stakeholders. "

Conference Call Details:

Hoteles City Express will host a conference call to discuss these results:

Conference Replay will be available for 30 days:
U.S.: 1-877-344-7529/ International: 1-412-317-0088
Passcode: 10099885

About Hoteles City Express:
Hoteles City Express is the leading and fastest-growing limited-service hotel chain in Mexico, in terms of number of hotels, number of rooms, geographic presence, market share and revenues. Founded in 2002, Hoteles City Express specializes in offering high-quality, comfortable and safe lodging at affordable prices via a limited-service hotel chain geared mainly towards domestic business travelers. With 124 hotels located in Mexico, Costa Rica and Colombia, Hoteles City Express operates five distinct brands: City Express, City Express Plus, City Express Suites, City Express Junior and City Centro, to serve different segments of its target market. In June 2013, Hoteles City Express completed its IPO and began trading on the Mexican Stock Exchange under the ticker symbol "HCITY" furthermore, on October 8, 2014, Hoteles City Express completed a follow on with the aim of accelerating its growth in new hotels in coming years.

HCITY is covered by the following financial institutions and analysts:  Actinver (Pablo Duarte), Bank of America Merrill Lynch (Carlos Peyrelongue), Citigroup (Alejandro Lavín), ITAU BBA (Enrico Trotta), J.P. Morgan (Adrián Huerta), Morgan Stanley (Nikolaj Lippman), Santander (Cecilia Jiménez), Signum Research (Armando Rodriguez), and UBS (Marimar Torreblanca).

For further information, please visit our website: www.cityexpress.com/en/investors

Disclaimer: The information presented in this report contains certain forward-looking statements and information regarding Hoteles City Express, S.A.B. de C.V. and its subsidiaries (jointly, "the Company"), which are based on the understanding of its management, as well as assumptions and information currently available to the Company. These statements reflect the Company's current vision regarding future events and are subject to certain risks, factors of uncertainty and assumptions. Many factors may cause the results, performance or current achievements of the Company to be materially different with respect to any future result, performance or accomplishment of the Company that might be included, expressly or implicitly, within such forward-looking statements, including, among other things: changes in general economic and/or political conditions, governmental and commercial changes at the global level and in the countries in which the Company does business, changes in interest rates and inflation, exchange rate volatility, changes in business strategy and various other factors. If one or more of these risks or uncertainty factors should materialize, or if the assumptions used prove to be incorrect, actual results could differ materially from those described herein as anticipated, estimated or expected. The Company does not intend to assume, and does not assume any obligation whatsoever to update these forward looking statements.

SOURCE Hoteles City Express S.A.B. de C.V.