Q3 FY 2018/19 Earnings Update February 2019 Jetwing Symphonys - - PowerPoint PPT Presentation

February 2019

Q3 FY 2018/19 Earnings Update

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Jetwing Symphony’s operating portfolio for Q3FY19

Jetwing Colombo Seven (Colombo)

The group’s first luxury hotel in the commercial capital offering an urban resort experience in the city

Rooms : 98 Occupancy : 65% ARR : 14,162

Jetwing Lake (Dambulla)

A luxurious resort set in the center of centuries

• f ancient Sri Lankan

history

Rooms : 94 Occupancy : 60% ARR : 13,786

Jetwing Yala (Yala)

A luxurious resort

• ffering a wilderness

experience by the beach

Rooms : 90 Occupancy : 63% ARR : 19,676

Jetwing Kaduruketha (Wellawaya)

The first agro luxury eco tourism hotel in Sri Lanka offering their guests unique experiences

Rooms : 25 Occupancy : 36% ARR : 22,759

Jetwing Surf (Pottuvil Point)

The first high end resort in Pottuvil Point constructed with a minimum carbon footprint

Rooms : 20 Occupancy : 19% ARR : 16,345

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Group highlights Q3FY19

Our key performance highlights

Revenue

LKR 484Mn (+37%)

Jetwing Lake and Yala recorded a LKR c.53mn (+71% QoQ) and LKR c.44mn (+36% QoQ) increase in hotel revenue, respectively, which greatly contributed to a QoQ group revenue growth of 37%

EBIT

LKR 82Mn (+3,479%)

Significant improvements in ARR and overall

• ccupancy has resulted in the Group making

improvements in profits at the EBIT level

EBITDA

LKR 164Mn (+101%)

EBITDA margins improved from 23% to 34% as a result of better management of hotel

• perating expenses

Occupancy

• c. 58% (+5%)

The Group reported an occupancy of c. 58% with Jetwing Lake and Jetwing Yala recording higher QoQ occupancy rates

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LKR Mn Q3 FY18 Q3 FY19 QoQ 9M FY18 9M FY19 YoY FY 19 IPO Forecast** Revenue 355 484 37% 1,004 1,303 30% 2,354 Gross Profit 290 404 40% 814 1,085 33% 1,909 EBITDA 82 164 101% 213 406 91% 778 EBIT 2 82 3,479% (23) 160 790% 375 PAT* (104) (32) 69% (337) (170) 50% (78) PAT (107) (131)

• 22%

(346) (370)

• 7%

(100) GP Margin 82% 84% 81% 83% EBITDA Margin 23% 34% 21% 31% EBIT Margin 1% 17%

• 2%

12% NP Margin

• 30%
• 27%
• 34%
• 28%

Gearing Ratio 44% 47% 44% 47%

*Excludes foreign exchange conversion gains/losses

• The Group revenue grew by 37%

whilst EBITDA and EBIT recorded growth of 101% and 3,479% respectively, over the last corresponding quarter

• The main contributors to

Revenue were Jetwing Lake, Jetwing Colombo Seven and Jetwing Yala, making up over 85%

• f the group Revenue
• 69% improvement in the

recurring profit after tax (i.e. excluding forex losses), testament to management’s commitment towards achieving steady bottom- line growth, leveraging on the Jetwing brand

Jetwing Symphony performance remained robust amidst challenges faced by the industry due to political uncertainties

**Full Financial Year Forecast. Source: Jetwing Symphony IPO Prospectus – Independent Valuation Report

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• Jetwing Yala, Jetwing Colombo Seven and Jetwing Lake were the

top revenue contributors for the quarter, with a contribution of 34%, 30% and 24% respectively to the Group’s revenue

• All properties recorded significantly higher ARRs than the last

corresponding quarter

• The Company's efforts to enhance its cost structures by managing
• perating expenses have allowed them to make significant savings

thereby improving EBITDA by 101%

(20) 80 180 280 380 480 Q3FY18 Q3FY19 9MFY18 9MFY19

EBITDA (LKR Mn)

• 200

400 600 800 1,000 1,200 1,400 Q3FY18 Q3FY19 9MFY18 9MFY19

Revenue (LKR Mn)

Jetwing Surf Jetwing Lake Jetwing Yala Jetwing Colombo Seven Jetwing Kaduruketha

Revenue growth of c.37% coupled with effective control of operational costs translated to EBITDA margin improving from 23% to 34%

37% 101% 30% 91%

56.2% 37.5% 3.1% 3.2% 59.8% 33.8% 2.6% 3.8%

Revenue Composition

Rooms Food and Beverages Banquet Spa and Other Income

FY2018 FY2019

OUR OPERATIONAL HOTEL PERFORMANCE

7 LKR Mn Q3 FY18 Q3 FY19 QoQ 9M FY18 9M FY19 YoY Revenue 125 169 36% 385 442 15% Gross Profit 101 139 38% 311 359 16% EBITDA 37 63 70% 115 142 23% EBIT 16 42 164% 52 80 55% PAT* (2) 24 1,656% 27 7,132% PAT (2) 6 358% (4) (13)

• 264%

*Excludes foreign exchange conversion gains/losses

GP Margin 81% 82% 81% 81% EBITDA Margin 30% 37% 30% 32% EBIT Margin 13% 25% 14% 18% NP Margin

• 2%

3%

• 1%
• 3%
• EBITDA margin improved from 30% to 37%, mainly driven by a QoQ revenue growth of

36%

• Increase in occupancy and Hotel ARR resulted in a RevPAR of LKR 12,305 which was a

QoQ improvement of 44%

Jetwing Yala: positive PAT for the quarter driven by an increase in the ARR,

• ccupancy and operating efficiencies

15 19 36 37 0% 10% 20% 30% 40% 50% 60% 70% 80% 5 10 15 20 25 30 35 40 Q3FY18 Q3FY19 ARR in LKR Thousands ARR - Hotel ARR - Safari Camp Occupancy - Hotel Occupancy - Safari Camp 56.7% 39.6% 3.7% 60.2% 35.2% 4.6% Rooms Food and Beverages Spa and Other Income

FY2018 FY2019

8 LKR Mn Q3 FY18 Q3 FY19 QoQ 9M FY18 9M FY19 YoY Revenue 21 28 34% 54 80 48% Gross Profit 17 24 42% 44 69 58% EBITDA 2 5 110% 2 15 854% EBIT (2) 120% (10) 2 124% PAT* (9) (4) 59% (33) (9) 71% PAT (9) (8) 20% (33) (17) 49%

*Excludes foreign exchange conversion gains/losses

GP Margin 82% 87% 81% 86% EBITDA Margin 11% 17% 3% 19% EBIT Margin

• 8%

1%

• 19%

3% NP Margin

• 45%
• 27%
• 61%
• 21%
• Increase in the ARR, as the hotel continues to position as an agro eco-luxury resort,

resulted in a positive EBITDA despite an occupation drop from 38% to 36%

• A 34% revenue growth, in tandem with efficient control of food and beverage costs

resulted in the Gross Profit margin increasing from 82% to 87%

Jetwing Kaduruketha: significant boost to profitability margins with management continuing to focus on ARR, convinced by the hotel’s niche positioning

12 23 30% 32% 34% 36% 38% 40% 5 10 15 20 25 Q3FY18 Q3FY19 ARR in LKR Thousands Total ARR Total Occupancy 52.3% 42.3% 5.4% 66.1% 30.7% 3.2% Rooms Food and Beverages Spa and Other Income

FY2018 FY2019

9 LKR Mn Q3 FY18 Q3 FY19 QoQ 9M FY18 9M FY19 YoY Revenue 75 128 71% 206 313 52% Gross Profit 59 105 77% 156 254 63% EBITDA 7 43 479% 6 83 1,363% EBIT (17) 19 214% (66) 12 118% PAT* (57) (22) 61% (185) (102) 45% PAT (58) (35) 39% (186) (129) 31%

*Excludes foreign exchange conversion gains/losses

GP Margin 79% 82% 76% 81% EBITDA Margin 10% 33% 3% 26% EBIT Margin

• 22%

15%

• 32%

4% NP Margin

• 78%
• 28%
• 90%
• 41%
• Room occupation increased from 48% to 60%, and ARR increased by 59% in Q3FY19

which resulted in a RevPAR of LKR 8,327, a QoQ improvement of 99%

• Jetwing Lake recorded a positive EBIT, despite sharp finance expenses and foreign

exchange losses having a detrimental effect on the PAT

Jetwing Lake: increase in both the occupancy rate and ARR resulted in a 4.8 times increase in QoQ EBITDA

9 14 35% 40% 45% 50% 55% 60% 65% 70% 2 4 6 8 10 12 14 16 Q3FY18 Q3FY19 ARR in LKR Thousands Total ARR Total Occupancy 48.2% 49.8% 2.0% 56.1% 41.1% 2.8% Rooms Food and Beverages Spa and Other Income

FY2018 FY2019

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12 14 12 16 40% 45% 50% 55% 60% 65% 70% 75% 80% 2 4 6 8 10 12 14 16 18 Q3FY18 Q3FY19 ARR in LKR Thousands ARR - Deluxe Rooms ARR - Apartments Occupancy - Deluxe Rooms Occupancy - Apartments

LKR Mn Q3 FY18 Q3 FY19 QoQ 9M FY18 9M FY19 YoY Revenue 131 147 12% 357 385 8% Gross Profit 109 126 16% 294 327 11% EBITDA 41 62 50% 101 144 43% EBIT 11 33 186% 13 57 341% PAT* (30) (15) 50% (111) (77) 30% PAT (30) (76)

• 149%

(114) (197)

• 72%

*Excludes foreign exchange conversion gains/losses

GP Margin 83% 86% 82% 85% EBITDA Margin 31% 42% 28% 38% EBIT Margin 9% 22% 4% 15% NP Margin

• 23%
• 51%
• 32%
• 51%
• Room, food and other hotel operational costs dropped significantly without

compromising on the services offered, due to effective use of resources

• Drop in occupancy due to a reduction in the number of Travel Agency bookings and

Free Independent Tourists bookings as a result of the island’s political situation during the last quarter

Jetwing Colombo Seven: 12% increase in revenue converted to a 50% EBITDA growth driven by improving ARRs

61.1% 27.7% 8.2% 3.0% 61.7% 25.7% 8.8% 3.8% Rooms Food and Beverages Banquet Spa and Other Income

FY2018 FY2019

11 LKR Mn Q3 FY18** Q3 FY19 QoQ 9M FY18 9M FY19 YoY Revenue 2 10 417% 2 81 3,930% Gross Profit 1 8 424% 1 67 4,403% EBITDA (1) (6)

• 613%

(1) 16 1,596% EBIT (2) (10)

• 418%

(3) 2 172% PAT* (2) (19)

• 826%

(3) (21)

• 734%

PAT (2) (21)

• 960%

(3) (27)

• 945%

*Excludes foreign exchange conversion gains/losses **Operations commenced in December 2017

GP Margin 74% 75% 74% 83% EBITDA Margin

• 38%
• 53%
• 55%

20% EBIT Margin

• 100%
• 100%
• 128%

2% NP Margin

• 100%
• 205%
• 128%
• 33%
• Off-season in Arugam Bay resulted in an occupancy rate of 19% which reflected in

unfavourable profit margins. However, the hotel recorded an increase in QoQ

• ccupancy rates, from 11% in Q3FY18
• Profit margins suffered due to low occupancy and fixed costs associated with running

the hotel which is still a relatively new establishment

Jetwing Surf: increase in the QoQ revenue as the relatively new addition gains popularity amongst holidaymakers visiting Arugam Bay

13 16 0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 2 4 6 8 10 12 14 16 18 Q3FY18 Q3FY19 ARR in LKR Thousands Total ARR Total Occupancy 45.2% 51.0% 3.8% 53.9% 43.9% 2.2% Rooms Food and Beverages Spa and Other Income

FY2018 FY2019

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TripAdvisor rating: Amazing hotel Highly recommend for the sunsets alone, the fact the food, the rooms and the 80m pool are brilliant just tops this place off. I don’t think you can stay any better than this hotel. If you want an open view make sure you select the deluxe room. Bookings.com rating: TripAdvisor rating: Hidden gem Words cannot describe how beautiful this resort is! Our room 108 had the most stunning view! Food is absolutely Delish! Especially the curd and raw mango juice! Staff are wonderful and always with a smile of their face special thank you to our butler Prabath. We will surely be back! Bookings.com rating: TripAdvisor rating: Perfect

• PERFECT. Can't think of

anything that would improve this place. The view of the lake from every room, the huge pool, the wonderful range of food in the restaurant, and the amazingly friendly helpful staff. We would come back tomorrow if we could. Bookings.com rating: TripAdvisor rating: Best hotel in Colombo This hotel is amazing. Rukshan in the roof top bar is a true

• gent. He made us feel very

welcome and tailored our food to suit. This is the perfect place to begin or end your trip to Sri

• Lanka. Highly recommended.

Bookings.com rating: TripAdvisor rating: Outstanding We had a wonderful stay at this property. The location is not very close to any outside restaurants, but is very close to the beach and the facilities mean that is not an issue at all. The cabanas are beautiful, the staff are wonderful, the food is excellent and it's a stunning

• location. Would definitely stay

here again, it was a magical few days. Bookings.com rating:

Source: TripAdvisor, Bookings.com

Jetwing Symphony hotels have been praised by guests for their ambience, exceptional service and hospitality

PROGRESS UPDATE

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Construction underway for Jetwing Kandy Gallery – Symphony’s latest project to create an immersive experience of the rich Kandyan heritage, for its guests

Status update on the Jetwing Kandy Gallery Project

• Jetwing’s latest venture aims at creating a link between its

guests and the rich heritage of Kandy

• The hotel would be formed with two-wings, with a semi-

public ‘Gallery Walk’, separating them. This display will showcase Kandyan arts and crafts

• 80% of the overall sub-structure and 30% of the super-

structure work has been completed Stage Stage of Completion Excavation and Earthwork 65% Concrete Work 40% Masonry Work 30% MEP Work 10% Mockup Room 25%

Q & A