Wyndham reports 55% increase in revenue received
The hotel chain arrived last March to 9,200 properties in its portfolio and 812,000 rooms
Wyndham Hotels & Resorts, the largest hotel franchise company in the world, with more than 9,200 units in operation on a global scale, and with a strong presence in Mexico and Latin America, reported strong results in the first quarter of 2019, achieving growth of 55% in consolidated revenues and 21% in operating cash flow (EBITDA) adjusted with respect to the first three months of last year.
The company, which is also a leading provider of hotel management services with more than 400 properties under its management, which is managed by Geoffrey A. Ballotti, revealed that in the January-March 2019 period it had a turnover of 468 million dollars, compared to to 302 million in the first quarter of the previous year. This increase was driven by the purchase of La Quinta, which added 169 million dollars of revenue.
Thus, the hotel chain expanded 23% in the first three months of the year, with a record 181,000 rooms, thanks to the addition of La Quinta. In an unprecedented event, during this timeframe, it was also able to achieve the integration of this brand in the central distribution platforms and considers having carried out the largest migration in the history of the hotel industry, in just one day. This is in addition to the evolution of the award-winning Wyndham Rewards program and the incorporation of free nights in thousands of hotels from just 7,500 points.
Even excluding the impact of acquisitions and divestments, the revenues obtained were consistent with those of the last year, mainly due to greater perceptions for the use of licenses and brands, which was partially offset by lower revenues for the reimbursement of expenses.
"The first quarter results were consistent with our expectations and include double-digit growth in adjusted EBITDA, despite incurring a greater proportion of our marketing expenses since the beginning of 2019," said Ballotti.
Based on the company's results report, which in Mexico operates a total of 53 hotels, including the Wyndham, La Quinta, Wyndham Garden, Ramada Encore and Microtel brands, the adjusted adjusted EBITDA for the first quarter of this year amounted to 111 million dollars, compared to 92 million in the same period last year.
In the reference period, the room portfolio expanded by 15% in Latin America thanks to new openings, including the Costa Blu Beach Resort Trademark Collection by Wyndham, in Belize.
In addition, Asian markets were characterized as the most dynamic for the company. In the case of Singapore, it had a 25% increase in net room capacity, while in Vietnam a second hotel was opened and property number 40 opened in South Korea, while in China 10,000 rooms were added to the portfolio , including the Ramada by Wyndham Hong Kong Harbor View, which marked the official return of the group to the center of this city.
Meanwhile, in Europe, the Middle East and Africa were added almost 1,000 rooms, to include new tourist complexes, in places such as the Greek Islands, where the first Wyndham Grand was installed. With respect to the United States, the company registered a fourth consecutive quarter of growth in the offer of rooms, opening new hotels of the brands AmericInn, Wingate, Travelodge, Trademark and La Quinta.
The company's management estimates that the first quarter 2019 report reflects approximately 33 million dollars of the adjusted operating flow of La Quinta.
"We grew 7% internationally from year to year. For the fourth consecutive quarter we had a net domestic growth in quarters and our adjusted EBITDA increased 21%, "said the group's president in a conference call with analysts.
As of March 31 of this year, the company's portfolio included approximately 9,200 properties and 812,000 rooms, representing an expansion of 12% compared to the first quarter of 2018.
For all 2019, the group maintains its results guide, which includes revenues of 2,110 to 2,160 million dollars, which would imply an increase of 13 to 16% over last year.
It also contemplates an adjusted EBITDA of 605 to 620 million dollars, for an increase of 19 to 22% with respect to 2018.
At the level of adjusted net income, the company expects to reach a level of between 301 and 313 million dollars for the current year.