Design Hotels AG, integrated provider of marketing and positioning services for individually managed hotels and small hotel groups in the New Luxury Segment, has reported its preliminary results for the 2008 financial year and the fourth quarter of 2008.
Revenues for the full year increased by 16% compared to 2007 and were therefore ahead of expectations. Adjusted for exceptional items, both the operational result and net profits were at last year's level.
Revenues for the financial year 2008 increased by around 16% to 9.14 million (2007, 7.88 million). Revenues for the fourth quarter increased by 29% to 2.86 million (2007, 2.23 million). All business areas contributed to the growth. The business area Concept Development Consulting posted for the first time significant revenues. Booking commissions came in at 4.28 million (+2%) and thereby contributed approximately half of total revenues. Marketing Products/Consulting achieved revenues of 2.75 million (+51%) and Membership Fees reached 2.11 million (+14%)
With 72%, the Gross Margin for the full year was slightly above last year's (71%). For the fourth quarter the Gross Margin reached 63%, the same as for 2007.
The EBITDA for 2008 came in at 1.07 million, a fall of 16% compared to 1.28 for 2007. It should be noted that the 2008 EBITDA included a one-off contribution through the collection of a previously written off claim of 130,000. Last year's result included a contribution from exceptional items for a total of 370,000. Adjusted for exceptional items, this year's operational result was in line with that for 2007. EBITDA for the fourth quarter fell by 11% to 254,000 (2007, 284,000)
The EBITDA Margin, after exceptional items, was 12% (2007, 16%). In the fourth quarter, this margin came in at 9% (2007, 13%).
The EBIT for 2008 came in at around 0.91 million, falling by 19% compared to the 1.13 million for 2007. For the fourth quarter, the EBIT went down by 5% to 228,000 (2007, 240,000).
Net Profit for 2008 was 1.05 million as compared to 1.17 for 2007, a fall by around 10%.
On December 31, 2008, the Company had cash and cash equivalents of 2.78 million compared to 2.20 million on the 31st of December 2007. Shareholders' equity increased from 4.73 million to 5.64 million.
At the end of the business year, 176 hotels (2007, 174) with 12,825 (2007, 13,256) rooms in 112 destinations and 42 countries were affiliated with Design Hotels. While in 2007 420 hotels applied for membership, the figure for this year was a record 469. Design Hotels had, averaged over 2008, 57 employees (2007, 48).
CEO Claus Sendlinger commented: "With again two digit revenue growth and a net result that, adjusted for exceptional items, was at last year's level, we are slightly ahead of our plans for 2008. This also means for the fourth consecutive year, our growth figures were well above those for the market. One of the key drivers this past year has proven to be the business area Concept Development Consulting, which we decided to enter two years ago. While booking revenues stayed at last year's level, mainly due to the roughly similar number of rooms compared to last year, the business area Concept Development for the first time posted significant revenues, thereby contributing to a result for Marketing Products/Consulting with which we are very happy."
"We believe that this development validates our decision to differentiate our service offering and the resulting expansion in the number of employees. We have therefore accepted that our bottom line would not develop in line with revenues as the investments made form the basis for tomorrow's growth. The same goes for our consistently strict rules for accepting new member hotels. We have seen a net increase in member hotels of only two in the past year, but at the same time improved the quality of our membership through the cancellation of non-performing relationships and the addition of 27 new properties."
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