Corporate Presentation Q4 2013 Carlson Rezidor Hotel Group 665 - - PowerPoint PPT Presentation

1 /

Corporate Presentation Q4 2013

2 /

Carlson Rezidor Hotel Group

665hotels

76,000 rooms

189 hotels

32,000 rooms

430 hotels

95,000 rooms

THE AMERICAS ASIA PACIFIC EMEA

3 /

Creation of the Carlson Rezidor Hotel Group: A strategic, global partnership refined to exploit synergies

Deliver the brand promises Accelerate global development Establish clear, compelling positioning for each brand Win the revenue battle Build a global team and organisation

Key Objectives

4 /

RANK COMPANY 2013 HOTELS 2013 ROOMS 1 INTERCONTINENTAL 4,602 676,000 2 HILTON 3,992 652,000 3 MARRIOTT 3,672 639,000 4 WYNDHAM 7,342 627,000 5 CHOICE 6,198 497,000 6 ACCOR 3,515 450,000 7 STARWOOD 1,121 328,000 8 BEST WESTERN 4,024 312,000 9 HOME INNS 1,772 214,000 10 CARLSON REZIDOR 1,077 166,000 RANK COMPANY 2013 HOTELS 2013 ROOMS 1 ACCOR 2,396 258,000 2 BEST WESTERN 1,312 90,600 3 INTERCONTINENTAL 574 89,200 4 GROUPE DU LOUVRE (*) 974 70,400 5 CARLSON REZIDOR (**) 255 51,800 6 NH HOTELES 347 50,800 7 WHITBREAD 641 50,700 8 HILTON 205 46,600 9 MELIA 195 44,700 10 MARRIOTT 245 44,600

SOURCE I MKG Hospitality 2013 (*) Louvre Hotels Group + Concorde Hotels (**) Rezidor + Park Plaza + Radisson Edwardian

No 10 worldwide No 5 in Europe

One of the world’s ten largest hotel groups

5 /

A portfolio of 430 hotels & 95,000 rooms; 35,000 employees 70+ countries across Europe, the Middle East & Africa Publicly listed on Stockholm Stock Exchange since 2006 2 strong core brands: Radisson Blu (upper upscale), Park Inn by Radisson (mid-scale) Member of the Carlson Rezidor Hotel Group,

• ne of the world's ten largest hotel groups

Our Mission

We provide unique “Yes I Can!” service

It’s our way of life! It’s about positive attitude! It’s personal! It’s about competence and empowerment!

Our Values

They are strong and differentiate us – which we will further build upon

BEING HOST

Be professional, responsible, focused on qualitative service and provide memorable experiences.

LIVING TRUST

Earn trust through honesty and integrity, empower employees at all levels. We promise, we deliver results.

FIGHTING Z-PIRIT

Always entrepreneurial, innovative and opportunity driven

• quick decision making.

Our Vision

We will be recognised as:

• Building
• utstanding guest

loyalty by providing memorable experiences

• Committing to

attracting, developing and retaining talent

• Leading the industry

in anticipating trends and responding to changing customer needs

• Caring for our planet

and acting in a sustainable way

• Delivering

consistent and compelling financial returns to our

• wners and

shareholders

• Valuing strong and

long-term relationships with all stakeholders

• Operating

distinctive and market leading brands

• Being the leader in

the Nordics and Emerging Markets

The most passionate team of hoteliers The most innovative and responsible

• rganisation

The preferred hotel company to invest in and to do business with The most dynamic hotel company in EMEA

D...DEVELOP TALENT

Attract and retain high calibre team members Invest in team member competencies and talents Drive a Performance and Talent Management Culture Recognize performance and ensure competitive compensation

D...DELIGHT GUESTS

Enhance and deliver the brands’ promises Create and deliver Bright Spots Rekindle the innovation culture Rejuvenate Food & Drink

D...DRIVE THE BUSINESS

Drive profitable Total Revenue Drive intelligent Cost Management and increase operational flexibility Drive profitable growth with a focus on Emerging Markets Drive pro-active Portfolio Management and deleverage the company

D...DELIVER RESULTS

Deliver compelling results for our hotel owners Maximize shareholder value

Our Credo “Whatever you do, DO WITH INTEGRITY. Wherever you go, GO AS A LEADER. Whomever you serve, SERVE WITH CARING. Whenever you dream, DREAM WITH YOUR ALL. And never, ever give up.”

CURTIS CARLSON

15

Our global brand architecture

LIMITED SERVICE LUXURY UPPER UPSCALE UPSCALE UPPER MIDSCALE MIDSCALE ECONOMY SELECT SERVICE FULL SERVICE AVERAGE DAILY RATE

Our core brands: Radisson Blu and Park Inn by Radisson

267 HOTELS 64,400 ROOMS

Hotels and rooms In operation and under development dated Q4 2013

UPPER UPSCALE UPSCALE MIDSCALE 155 HOTELS 29,200 ROOMS

17 /

Radisson Blu is Europe’s largest upper-upscale hotel brand

Number of Hotels Number of Rooms

188 146 87 71 55 20 40 60 80 100 120 140 160 180 200 Hilton Marriott Crowne Plaza Sheraton 43,900 37,300 21,200 16,400 15,400 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 50,000 Hilton Marriott Crowne Plaza Sheraton

SOURCE / MKG Hospitality Database / March 2013 (In Operation)

19% 40% 25% 16%

NOR RoWE EE MEAO

4% 13% 38% 47%

NOR RoWE EE MEAO

16% 34% 28% 22%

NOR RoWE EE MEAO

In operation Q4 2013

337 hotels 75,300 rooms 92 hotels 19,500 rooms

Under development Q4 2013

429 hotels Almost 95,000 rooms

Total Q4 2013

50%

Emerging Markets

50%

Home Markets

22% 54% 24%

Leased Managed Franchised

92% 8%

Leased Managed Franchised

18% 62% 20%

Leased Managed Franchised

Profitable, asset-light and sustainable growth – focused on Emerging Markets

An award-winning Responsible Business Programme

• Our Scandinavian DNA
• First to launch RB programme 1990s
• World Childhood Foundation as

global charity organisation

• One of the World’s Most Ethical

Companies for 4 consecutive Years

Latest initiative:

Think Planet – targeting 25% energy consumption reduction by 2016

Health, Safety & Security for guests and employees Respect for social and ethical issues within the company Reduced environmental impact

3 Pillars of Responsible Business

20 /

FINANCIAL PERFORMANCE Q4-2013

Q4 2013: Continued strong RevPAR growth and margins well above last year

• L/L RevPAR growth of 5.4%, driven by both occupancy and

rate

• Revenue down 1.9% due to strengthening of the Euro and exit
• f leases in 2012. L/L Revenue was up 4.0%
• EBITDA margin up 4.4pp to 10.9%
• Strict Cost Control and the 2012 exit of unprofitable leases

led to solid conversion of revenue to EBITDA

• EBIT margin up 9.0pp to 5.4%
• Four Asset Management deals signed in Q4, and yet another

in January

21

11% EBITDA Margin

+4.4pp

RevPAR

+5.4%

(L/L) €13m EBIT

+€22m

€26m EBITDA

+€10m

Full Year 2013: Margins well above last year and in line with Route 2015 targets

• L/L RevPAR growth of 5.8%, driven mainly by occupancy
• Strong growth in Market Share (RGI): up 1.6%
• Unchanged Revenue due to the strengthening of the Euro

and the exit of leases in 2012. L/L Revenue was up 3.2%

• Fee Revenue up 11.0% due to a strong underlying

performance in the emerging markets

• EBITDA margin up by 3.3pp to 8.8%
• EBIT margin up by 4.9pp to 4.8%
• Cash Flow from operating activities up by MEUR 38.1

22

9% EBITDA Margin

+3.3pp

RevPAR

+5.8%

(L/L) €44m EBIT

+€45m

€81m EBITDA

+€30m

6.5% 3.0% 2.3% 3.2% 5.6% 5.9% 4.6% 4.2% 5.7% 6.0% 5.9% 5.4%

• 2%

0% 2% 4% 6% 8% 10%

L/L Occupancy L/L Average Room Rate L/L RevPAR

L/L Occupancy L/L Room Rates L/L RevPAR Reported RevPAR 2013 68.2% 107.8 73.5 69.2 2012 65.1% 101.7 66.2 67.4 2011 63.9% 102.3 65.4 63.0

Strong Occupancy driven RevPAR growth in 2012 & H1 2013 Average Rate growth increasing in H2 2013

Emerging Markets: South Africa, UAE, the Baltics and Poland were driving the RevPAR growth in Q4 2013

NORDICS EASTERN EUROPE REST OF WESTERN EUROPE MIDDLE EAST & AFRICA

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013 1.7% 1.8% 0.8% 3.4% 0.7% 8.8% 3.8% 2.3%

• 5%

5% 15% 25%

3.1% 2.0% 3.6% 2.2% 1.2% 4.2% 4.8% 5.5%

• 5%

5% 15% 25%

• 5%

5% 15% 25%

10.8% 17.1% 13.0% 7.9% 20.5% 13.5% 7.8% 8.9%

• 5%

5% 15% 25%

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2012 2013

+2.0% +1.6% +1.6%

64% of hotels RGI growth 69% of hotels RGI growth 63% of hotels RGI growth

Revenue generating initiatives and synergies with Carlson have powered strong growth in Revenue Generation Index (RGI) 2013 Full Year

25

Route 2015 gains further momentum

Key Areas12 2015 Target 2012 EBITDA Margin Impact 2013 EBITDA Margin Impact 2013 Comment

Revenue Generation 3-4% 0.6% 0.7%

• RGI grew by 1.6% FY 2013
• Carlson global partnership and synergies a key driver
• Increased focus on Global Sales, digital channels,

distribution and RevGen optimisation Fee Based Growth 2-2.5% 0.4% 0.3%

• 14 hotels with 3,300 rooms opened
• 32 hotels signed with 6,400 rooms
• 100% fee based pipeline of 100 hotels and 19,500 rooms

Cost Savings 0.5-1%

• 1.2%
• Continued focus on Project FIT (cost & process optimisation)

which is ahead of the communicated target of MEUR 13-15 by 2015

• Central Costs MEUR 42.3 (vs. MEUR 47.9 in 2012)

Cap Utilisation 0.5% 0.3% 0.0%

• 7 hotels filled their cap in 2012 with continued positive

contribution from same hotels in 2013 Asset Management

• 0.5%

0.4%

• 6 deals with an EBITDA impact of MEUR 4.1
• Will contribute with MEUR 5.8 (+0.6 pp) in 2015
• Clear strategy established to accelerate activities for

further exits of loss making hotels

Total

6-8% 1.8% 2.6% IN LINE WITH TARGET

MEUR 4.1 EBITDA contribution from Asset Management in 2013

In MEUR Upfront cost 2013 EBITDA Impact 2013 2014 2015

Signed in Q2 2013 Two lease restructurings 0.5 0.5 0.5 Signed in Q4 2013 One lease restructuring 1.5 1.0 1.0 One lease restructuring 2.1 2.1 2.1 One lease restructuring 1.7 1.7 One contract termination

• 1.9

0.5

Total 2013

• 1.9

4.1 5.3 5.8 Signed in Q1 2014 – announced on Feb 7, 2014 One lease restructuring 1.1 1.2

Total 2013 & 2014

4.1 6.4 7.0

• Asset Management deals in 2012 (7 leases in France and 2 leases in Sweden) and 2013 had a

combined positive effect on the EBITDA margin of ca 1.1 pp.

Q4 comments:

• 40% of the signed rooms in Q4 are conversions of existing

hotels

• Dual brand property in central Moscow (now 11 hotels) in
• ne of our key focus countries

Q4 signings: underlying conversion opportunities

Radisson Blu Palace Hotel Noordwijk aan Zee, Netherlands

100%

Fee-based

80%

Emerging Markets

65%

Radisson Blu Q4 2013

SIGNINGS Q4 2013 Q4 2012 FY 2013 FY 2012 Hotels 8 4 32 30 Rooms 2,100 1,300 6,400 7,100

Radisson Blu Le Vendome Hotel Cape Town, South Africa

Q4 openings: in line with last year but FY impacted by delays in Emerging Markets

Q4 comments:

• Expansion in Russia with 3 new hotels; Sochi,

Petrozavodsk, Yaroslavl

• Conversion in Germany with PI Göttingen

OPENINGS Q4 2013 Q4 2012 FY 2013 FY 2012 Hotels 4 5 14 18 Rooms 940 1,100 3,300 4,000

100%

Fee based

>85%

Emerging Markets

50%

Radisson Blu Q4 2013

Park Inn Petrozavodsk, Russia Radisson Blu Paradise Resort & Spa Sochi, Russia

Q4 2013 Hotel Portfolio

WOLFGANG M. NEUMANN President & CEO KNUT KLEIVEN Deputy President & Chief Financial Officer OLIVIER HARNISCH Executive Vice President & Chief Operating Officer ERIC DE NEEF SVP Marketing, CRM Global Branding Park Inn MICHAEL FARRELL Senior Vice President Human Resources MARIANNE RUHNGÅRD SVP, General Counsel & Secretary to the Board EUGÈNE STAAL Senior Vice President Technical Development ELIE YOUNES Senior Vice President Head of Group Development Age: 51 Seniority: 2.5 years Age: 59 Seniority: 27 years Age: 46 Seniority: 9 months Age: 49 Seniority: 2 years Age: 57 Seniority: 2 years Age: 53 Seniority: 13 years Age: 49 Seniority: 7 years Age: 36 Seniority: 3 years

Executive Committee

Board of Directors

TRUDY RAUTIO Chairman of the Board STAFFAN BOHMAN Vice Chairman of the Board WENDY NELSON Board Member (Director) GÖTE DAHLIN Board Member (Director) DOUG ANDERSON Board Member (Director) ANDERS MOBERG Board Member (Director) GÖRAN LARSSON Employee Representative

33 /