Capital Market Presentation, April 2019
This presentation is not the Company’s offer of securities to the public and should not be interpreted as an offer of securities to the public. The presentation constitutes the Company’s principal and marketing presentation. The information included in this presentation and any other information that shall be delivered during this presentation (hereinafter: “the Information”) does not constitute a recommendation or an opinion of an investment or tax consultant. The Information is only a condensed information. Investment in securities in general and in the Company in particular, carries risk. You should take into account that past data does not necessarily indicate future performance. Purchase of the Company’s securities requires an in -depth review of the information published by the Company and a legal, accounting, taxation and economic analysis thereof. Data regarding: (i) Summary of the number of hotels according to ownership / rent / management, broken down by sectors; (ii) Average daily income per room and average occupancy rates in the chain’s hotels in Cyprus; (iii) A graphic presentation of the contribution of hotels, in different geographical areas, to the Company’s EBITDA in 2018; as well as – (iv) A quarterly analysis of financial data for identical properties; - which were provided in Slides 13, 15, 16, 19 and 22, are provided in this presentation for the first time as additional information for investors. 2
Significant Events During and After the Report Period IPO • In February 2018, the Company completed the IPO of its shares in the amount of about ILS 507.4 million. • On February 12, 2018 and on March 12, 2018, 156,426 and 36,163 unregistered options respectively were allocated to 83 offerees. • On June 26, 2018, the Company issued ILS 255.840 thousand par value in bonds (Series B) to the public. • On October 23, 2018. the Company carried out an expansion of ILS 200.000 thousand par value in bonds (Series B) to the public. In January 2019, the Company carried out early redemption of its bonds (Series A) at the • amount of ILS 89.5 million. 3
JURYS INN Transaction on August 31, 2018, the operational activities of the 36 hotels under the Jurys Inn brand was consolidated for the first time 4
APOLLO In August 2018, the Company completed a portfolio purchase of 13 hotels in The Netherlands under the APOLLO brand, (ownership- 3 hotels, long term leasehold- 1 hotel, lease- 8 hotels and management-1 hotel) for a total cost of about EUR 154 million. 5
4 LONDON HOTELS In March 2019, the Group signed a lease agreement for 4 hotels in central London (1,311 rooms) for a period of 30 years (including the option period). At annual rent of about £ 55 million. 6
THE MIDLAND HOTEL By Leonardo Royal Hotel 7
JURYS INN EDINBURGH 8
Leonardo Royal Hotel Southampton 9
Royal Munich Leonardo Haifa Value of the hotel upon opening in 2011 – EUR 67 million. Leonardo Negev In June 2018, the Company concluded a Sale & Lease Back U Coral Beach Club Eilat Transaction for the amount of EUR 157 million. The minimal rent was signed for about EUR 7.2 million. … 10
Contribution to the Community • The Company employ about 80 employees with Establishment of the • disabilities in a variety of “Lev Fattal ” Motel for positions. children with cancer and their families in The Company adopts • Haifa (Rambam) nonprofit organizations such as: “ Hakav Hame'ahed ”, “ Leket Israel”, “Larger than • The Company intends Life”, “Ezra Lemarpeh ”. to establish 5 motels for children with cancer and their • Financial contributions in families in medical 2018 amounted to a total centers throughout of ILS 1,117 million. Israel over 10 years. 11
Tourism in Israel and Abroad Entry of Tourists into Israel(in millions) 2 Number of International Tourists (in millions) 1 1403 4.1 1329 3.6 1241 1193 2.9 1095 1141 3 2.9 1043 2.8 2.8 2.9 2.8 997 952 2.6 911 930 892 855 2.3 +273% 809 2.1 764 698 1.9 1.8 1.5 2003 2018 1.1 Rooms in Israeli Hotels (in thousands) 49.7 54.4 + 9.4% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1 Data from the UN World Tourism Organization (UNWTO) 2 Data from CBS 12
Fattal Group Calling Card The chain grows abroad The largest and leading hotel chain in Israel The Company was founded in 1998 by Mr. David Fattal As of the signing date of the financial statements: 203 38,892 18 Countries Hotels Rooms + 13.04% + 18.6% 3 - 3 12.17 + 9.1% Other דנלריאורחא 5 1 - 4 12.18 44 12.17 Britain 0 36 8 הינטירב 46 36 10 12.18 Europe 81 4 40 37 12.17 לארשיהפוריא 12.18 5 55 41 101 7 10 21 12.17 38 Israel 6 11 23 12.18 40 120 100 80 60 40 20 0 Ownership תולעבתוריכשלוהינ lease Management 1 As of December 31, 2018, this includes a future hotel in Israel , 16 future hotels in Europe , 2 future hotels in the UK and 2 future hotels in Cyprus. 13
The Netherlands (15) International Distribution 1 Belgium (2) Northern Ireland and Ireland (5) Poland (2) Germany (64) The UK, Wales and Scotland (47) Czech Republic (2) Hungary (1) Switzerland (3) Austria (1) Italy (4) 1 Spain (9) Greece (2) Cyprus (5) Israel (41) 1 As of the signing date of the financial statements. Including future hotels. 14
Average Occupancy Rates in the Chain 1 100% 90% 89% 80% 83% 81% 78% 77% 70% 75% 73% 72% 68% 60% 67% 63% 50% 40% 30% 20% 10% 0% 2016 2017 2018 The UK Europe Other Israel and Ireland 1 Including hotels held at 50%. 15
Average Daily Revenue Per Room 1 (ADR 2 ) (ILS) 1,000 900 909 879 882 800 700 600 579 500 529 512 499 488 483 400 445 381 300 200 100 - 2016 2017 2018 The UK Europe Other Israel and Ireland 1 Including hotels held at 50%. 2 The ratio between the hotel’s total revenue and the occupied rooms in the hotel. The figure does not include hotels under management. 16
Revenue of the Fattal Hotels Chain 1-2 (ILS million) 1,800 3,871 1,600 2,745 1,631 1,527 1,400 2,160 1,306 1,200 1,284 1,137 1,000 994 800 600 617 400 200 96 65 90 29 - 2016 2017 2018 The UK Europe Other Israel and Ireland 1 Including a relative share of hotels held at 50%. 2 It should be noted that as of May 1, 2017, the Company recognizes the full incomes of Protal Hotels, this following a new agreement with the partner in Protal to transition from a management agreement to a lease agreement. 17
EBITDAR (ILS million) 1,2 1,350 700 887 640 600 748 500 501 467 400 402 267 332 300 274 200 100 41 29 25 7 - 2016 2017 2018 The UK Other Europe Israel and Ireland 1 Including a relative share of hotels held at 50%. 2 It should be noted that as of May 1, 2017, the Company recognizes the full incomes of Protal Hotels, this following a new agreement with the partner in Protal to transition from a management agreement to a lease agreement. 18
EBITDA (ILS million) 1,2 EBITDA 2018 811 400 561 374 350 3% 4% 478 300 302 281 271 250 33% 228 200 201 45% 17% 150 37% 139 100 50 27 15 16 -4 - - 17% 2016 2017 2018 -50 The UK Other Israel Europe and The Ireland לארשידנלריאו הינטירבהינמרגדנלוהרחא Israel The UK and Ireland Other Germany Netherlands 1 Including a relative share of hotels held at 50%. 2 It should be noted that as of May 1, 2017, the Company recognizes the full incomes of Protal Hotels, this following a new agreement with the partner in Protal to transition from a management agreement to a lease agreement. 19
Revenue from Identical Properties of the Fattal Chain 1-5 (NIS million) 1,600 2,833 2,541 1,400 1,453 1,312 1,294 1,200 1,190 1,000 800 11.5% 600 400 200 68 57 - 2017 2018 The UK Europe Israel and Ireland 1 Including a relative share of hotels held at 50%. 2 Data regarding revenue of all the hotels that were fully active (i.e. that no significant physical changes were made in them) in the relevant cross section periods, while cancelling out hotels that were purchased during that period. 3 Does not include managed hotels that the Company’s incomes thereof derive from management fees. 4 It should be noted that as of May 1, 2017, the Company recognizes the full incomes of Protal Hotels, this following a new agreement with the partner in Protal to transition from a management agreement to a lease agreement. 5 It should be noted that the Leonardo Royal Edinburgh Hotel was closed for several months during 2017 due to renovations. 20
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