In its maiden results as a public company, Aim-newcomer Action Hotels (AHCG) has announced ambitious plans to expand across the Middle East. In December - the same month it floated - the group opened a Holiday Inn in Oman, its sixth establishment. It has eight more projects in the pipeline, all fully funded by the IPO proceeds, which will more than double the total room count to 2,500 by 2016.
Action's business model is to develop, own and manage mid-range hotels across the Middle East and Australia using third-party brands - the Holiday Inn name is licensed from InterContinental Hotels Group (IHG). The company says it is filling a market gap, as most hotel development in the Middle East is concentrated on the luxury market. Three are set to open this year in Bahrain and the UAE. In February, Action signed a deal with Whitbread, owners of Premier Inn, to develop the brand across the Middle East.
All hotels broke even last year, occupancy levels grew, underlying revenue per available room rose 10 per cent to $82 (£49) and the underlying cash profit grew 3 per cent to $9.1m. The numbers are skewed by the change in capital structure, but broker FinnCap expects the group to just break-even at the pre-tax level this year.
| ACTION HOTELS (AHCG) | ||||
|---|---|---|---|---|
| ORD PRICE: | 75p | MARKET VALUE: | £111m | |
| TOUCH: | 73-76p | 12-MONTH HIGH: | 79p | LOW: 61p |
| DIVIDEND YIELD: | 1.3% | PE RATIO: | na | |
| NET ASSET VALUE: | 113¢ | NET DEBT: | 39% | |
| Year to 31 Dec | Turnover ($m) | Pre-tax profit ($m) | Earnings per share (¢) | Dividend per share (p) |
|---|---|---|---|---|
| 2010** | 21.0 | -9.71 | -9.7 | nil |
| 2011** | 25.2 | -3.79 | -3.8 | nil |
| 2012** | 28.2 | -0.26 | -0.2 | nil |
| 2013 | 29.8 | -7.05 | -9.0 | 0.96 |
| % change | +6 | - | - | - |
Ex-div: 7 May Payment: 30 May **Pre IPO figures and pro-forma EPS £1=$1.65 | ||||
