Hoteles City Express Announces Results for 1st Quarter 2016 with 10.7% growth in RevPAR and 23.1% growth in Adjusted EBITDA

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Apr 20, 2016, 06:38 ET

MEXICO CITY, April 20, 2016 /PRNewswire/ -- Hoteles City Express S.A.B. de C.V. (BMV: HCITY) ("Hoteles City Express" or "the Company"), announced today its results for the first quarter ("1Q16") of 2016. The figures have been prepared in accordance with International Financial Reporting Standards ("IFRS") and are presented in Mexican Pesos ("$").

Financial and Operating Highlights (1Q16)

At the Chain level, occupancy in 1Q16 came to 59.3%, 224 basis points ("bps") higher than the same period of the year before. The Average Daily Rate ("ADR") and Revenue per Available Room ("RevPAR") showed increases of 6.5% and 10.7% in comparison with 1Q15, coming to $811 and $481, respectively.
Total Revenues were $455.0 million, which represents an increase of 20.9% over the same quarter in 2015, mainly due to a rise of 14.9% in the number of Occupied Room Nights at the Chain level, together with growth of 10.7% in RevPAR.
Operating Income was $74.6 million in 1Q16, an increase of 27.2% over the same quarter last year.
EBITDA and Adjusted EBITDA were $144.9 million and $148.6 million, respectively, reflecting increases of 22.0% and 23.1% in comparison with the same period of the previous year. EBITDA margin and Adjusted EBITDA margin for the period came to 31.8% and 32.7%, respectively.
Net Income for the period reached $47.2 million. Net Income margin came to 10.4% for the quarter.
At the close of the quarter, the Chain was operating 106 hotels, a gain of 10 new units compared to the 96 hotels operating at the close of the same period in 2015. The number of rooms in operation in 1Q16 was 11,944, an increase of 9.3% in comparison with the 10,929 installed rooms at the close of 1Q15. Furthermore, in the period from March 31, 2016, to the date of this present report, the Company opened the hotels City Express Junior Aguascalientes Centro and City Express CD MX Aeropuerto, bringing the chain to a total of 108 hotels and more than 12,000 rooms.

Operating and Financial Highlights	1Q16	1Q15	1Q16 vs 1Q15
Operating and Financial Highlights	1Q16	1Q15	% Change

*Operating Statistics for the Chain*

Number of Hotels at the End of the Period	106	96	10.4%
Number of Rooms at the End of the Period	11,944	10,929	9.3%

Number of Installed Room Nights	1,086,667	982,744	10.6%
Number of Occupied Room Nights	644,830	561,135	14.9%

Average Occupancy Rate (%)	59.3%	57.1%	224 bps
ADR($)	811	762	6.5%
RevPAR($)	481	435	10.7%

*Consolidated Financial Information (Thousands of Pesos)*

Total Revenues	454,953	376,394	20.9%

Operating Income	74,560	58,595	27.2%
Operating Income Margin	16.4%	15.6%	82 bps

Adjusted EBITDA	148,556	120,699	23.1%
Adjusted EBITDA Margin (%)	32.7%	32.1%	59 bps

EBITDA	144,859	118,770	22.0%
EBITDA Margin (%)	31.8%	31.6%	29 bps

Net Income	47,213	45,179	4.5%
Net Income Margin (%)	10.4%	12.0%	-163 bps

Adjusted EBITDA = Operating income + depreciation + amortization + non-recurring expenses (pre-opening expenses of new hotels).

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

"Our results reflect strong 1Q16 operating and financial metrics across all fronts for the Company. In particular, a notable increase of 10.7% in RevPAR was achieved through the combination of significant improvements in both rate and occupancy. Adjusted EBITDA growth of 23.1% was a standout result, representing a 32.7% margin, an improvement of 59 basis points compared to the same quarter last year.

Except for a small number of properties in locations oriented to the extraction of hydrocarbons in the Gulf of Mexico, all hotels in the chain benefited from a positive cycle in the tourism and travel industry across the country. This is due to the continuous progress in key demand generators for lodging throughout Mexico, specifically those related to consumption, exports, services and industry.

As for development, our installed room nights grew 10.6%, the result of the opening of 10 new hotels in the last 12 months. We remain focused on achieving our growth plan in 2016, aiming to open approximately 20 new hotels over the remainder of the year. Achieving this development objective is a priority for Hotels City Express in 2016.

During the first months of this year, we also made significant progress in our commercial strategy. We are particularly pleased with the double-digit increases in B2B platform, City @ccess and membership growth and redemptions in our frequent traveler program, City Premios. We will remain focused on supporting our sales force through all channels; however, our presence in digital channels is a priority. We are working hard to ensure these strong first quarter results are the beginning of a record year for Hoteles City Express."

Conference Call Details:

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

Date:	Thursday, April 21, 2016
Time:	11:00 am Eastern Time / 10:00 am Mexico City Time
Dial-in:	1-888-317-6003 (from within the U.S.) / 1-412-317-6061 (outside the U.S.)
	001-866-675-4929 (toll-free from within Mexico)
Passcode:	4765662
Webcast:	http://services.choruscall.com/links/hcity160421

Conference Replay will be available for 30 days:
U.S.: 1-877-344-7529/ International: 1-412-317-0088
Passcode: 10083869

About Hoteles City Express:
Hoteles City Express is considered 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 108 hotels located in Mexico, Costa Rica and Colombia, Hoteles City Express operates four distinct brands: City Express, City Express Plus, City Express Suites and City Express Junior, 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, in October of 2014, Hoteles City Express completed a follow on with the aim of accelerating its growth in new hotels in the short- and medium-term.

HCITY is covered by the following financial institutions and analysts: Actinver (Pablo Duarte), Bank of America Merrill Lynch (Carlos Peyrelongue), Citigroup (Dan McGoey), ITAU BBA (Ariel Bozza), J.P. Morgan (Adrián Huerta), Morgan Stanley (Nikolaj Lippman and Jorel Guilloty), Santander (Cecilia Jiménez), Signum Research (Armando Rodriguez), UBS (Marimar Torreblanca) and Vector Análisis (Marco Montañez).

For further information, please visit our website: https://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 and does not assume any obligation whatsoever to update these forward looking statements.

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