Hotel Properties Limited: Gradual signs of improvement with easing of borders

Shawn Sng  |   17 Jun 2022  |    187 views

  • More than 90% of total revenue in FY 2021 for HPL comes from its hotel division
  • An improvement of 33% in revenue reported in FY2021 was mainly due to higher contributions from its Maldives resorts.
  • Hotel Properties Limited’s 4.65% perpetual with a reset date on 5th May 2022 has been fully redeemed
  • Signs of improvement in tourism in Maldives and properties contribution to pick up in the 2nd half of 2022


Company Background

Hotel Properties Limited (HPL) is a hotel owner and operator with interest in 39 hotels across 15 countries. Some of their brands are Four Seasons, Hilton International, InterContinental Hotels Group and Six Senses Hotels. HPL is also a property developer in the premium residential and commercial property market. Forum The Shopping Mall and Concorde Singapore are a few prime commercial and retail properties that it owns. They are located in the main shopping belt of Orchard Road in Singapore.


The main revenue for the group in FY 2021 comprised hotels (93.1% in 2021) and more than half of this revenue was generated in Maldives (62.3%). As at 18th May 2022, HPL has a total market cap of $1.844bn.


Financial Highlights in FY2021

At the end of FY2021, HPL generated revenue of $344.2m, which is a 33% improvement YoY as compared with $258.8m in FY2020. This increase was mainly due to the resorts in Maldives. The group’s hospitality businesses in Singapore also saw a gentle pick up (FY2021 $90.6m vs FY2020 $90.3m) from the return of inbound travellers after the introduction of Vaccinated Travel Lanes (VTL) late last year. There was no contribution from the properties division as apartments from the Holland Park Villa and Burlington Gate in London were fully sold in 2020. HPL’s EBITDA as at 31 December 2021 stood at $109,075m, while EBITD was at $29,476m vs -$79,250m and -$159,847m in FY2020.


Credit Metrics

HPL has a Total Debt/Asset ratio of = 45.9% and a Cash to ST debt ratio of 54.6% as at 31 December 2021, compared with Wing Tai (17.68% and 258%). The EBITDA margin for HPL has improved from -30.6% in FY2020 to 31.7% in FY2021. HPL also has a gross profit margin of 10.8% in FY2021 vs -5.3% in FY2020. In terms of ageing receivables, the average age of receivable has gone down from 67 days in FY2020 to 56 days in FY2021. This recovery of its ageing receivables has also regain to its pre-pandemic levels where the average age of receivable in FY2018 is 55 days.



Things to Note:

Hotel Properties Limited’s 4.65% Perpetual (SGD)

  • Issue size: $150,000,000
  • Coupon Payment: Semi – annually (11 April and 11 October with the first payment on 11 October 2022)
  • The issuer has the option to recall the bonds at the end of year 5 and every 5 years thereafter. If the bonds are not redeemed in the 5th year, they will be reset at prevailing SGD 5yr SOR plus the initial spread (2.685%) + 1% on 5th May 2027
  • The proceeds from the issuance will be utilized for the purpose of refinancing existing borrowings and/or financing the working capital requirements of the Group, and/or as otherwise specified in the applicable Pricing Supplement.
  • This issuance have been fully redeemed as at 5th May 2022




Most of HPL’s revenue comes from its hotels, and this means that travel and tourism are critical for the group. Post-pandemic we are gradually seeing more borders open up to tourism, and we expect HPL hotel sector to do well in tandem with the reopening. Maldives’ tourist arrivals for the year as at 23 May 2022 were 669,413 vs 440,296 in 2021, and this is 92.6% of the tourism volume in 2019 during the pre-pandemic period (722,253). Also, there was a decline in contribution from the properties division in FY2021 as apartments from the Holland Park Villa and Burlington Gate in London were fully sold in FY2020. The completions in the 2nd half of 2022 (Phase 1 of Bankside Yards and completion of Paddington Square) will bolster the properties’ contribution if all goes according to plan.

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