The pan-Nordic hotel company has released its first-quarter results and, despite increased earnings across nearly all of its segments, it still sees room for improvement.
The hotel company Scandic has released its interim report for the first quarter of 2019, which shows a rise in adjusted EBITDA to SEK 160 million (€14.92 million) during the period, which corresponds to a margin of 3.9%.
Net sales rose by 7.3% to just over SEK 4 billion (€379 million), while earnings per share amounted to SEK 0.35 (€.033).
CEO Jens Mathiesen wrote: “Organic sales growth was 4.7% with just over half due to growth in comparable units. Sales were positively affected by the late Easter in 2019. Adjusted for that, sales and RevPAR for comparable units were marginally lower than in the corresponding quarter last year.”
Adjusted EBITDA in Scandic’s Swedish segment decreased by 3% to SEK 118 million (€11 million). As in previous years, this was the only segment not to experience an improvement in EBITDA, despite the period being Scandic’s weakest seasonally.
The report concluded that net results for the quarter were positively impacted by items affecting comparability, mainly attributable to capital gains from the sale of Scandic Hasselbacken in Stockholm for SEK 230 million (€21.44 million).
Improving the situation
“Demand for hotel nights continued to increase in our markets at the beginning of the year, but increased capacity growth in some destinations had a dampening effect, not least in the Oslo region, where several new hotels opened during the quarter,” Mathiesen began his comments.
However, he also stated that Scandic had “stepped up the pace” in the work towards increased efficiency.
“Scandic has a strong market position and scalable business model, but we need to be more selective in our priorities and we have increased our focus on the unprofitable parts of our business,” he concluded.