The Byke Hospitality
The company does not plan to raise any long term debt. Long term debt would be fully paid by FY 2018
The Byke Hospitality held conference call on 5th February 2016 to discuss its December 2015 results.
Highlights of the call:
The Byke Hospitality (Byke), is a fast growing hospitality services company. The company has presence across 50 cities. As on March 2015, the company had 519 rooms under its management, of which 102 are owned.
For the quarter ended December 2015, sales grew 23% to Rs 69.97 crore. OPM jumped 370 bps to 23.7% which took OP up 45% to Rs 16.57 crore. PBT jumped 62% to Rs 13.85 crore. Net profit grew 34% to Rs 9.04 crore.
For the nine months ended December 2015, sales grew 21% to Rs 163.51 crore. OPM jumped 240 bps to 22.3% which took OP up 47% to Rs 36.46 crore. PBT jumped 75% to Rs 28.45 crore. Net profit jumped 45% to Rs 18.58 crore.
The significant improvement in the company's performance is a result of the strategic turnaround initiatives taken over the last couple of years, leading to a strong resurgence of the Byke brand in the marketplace.
For the quarter Room portfolio under owned and leased (O&L) segment totals 623 rooms with an addition of Byke Suraj Plaza thane in 2016.
For the quarter ARR in O&L has risen from Rs 4132 to Rs 4150 y-o-y.
During the quarter in Room Chartering (RC) business the number of room nights sold increased from 119154 room nights to 147813 y-o-y.
ARR in Room Charteringwas Rs 2300.
O&L registered revenues of Rs 35 crore which was around 50% of total income. Same with Room Chartering business.
For the nine months O&L registered revenues of Rs 76.0 crore which was around 47% of total income.
For the nine months Room Chartering business registered revenues of Rs 87.5 crore which was around 53% of total income.
Occupancy has posted strong growth driven by domestic demand.
Moving ahead to make a good brand in domestic market.
The company has 10 properties out of which 8 are operational.
The company sold 360000 room nights during the nine months compared to 370000 room nights whole of last year.
The company has extended its business s to 50 cities.
Occupancy level stood at 69% compared to 75% - the drop is due to new property addition.
The company hopes to add 400 rooms by FY 2018. Place and locations have been identified.
Interest cost fell due to repayment of loan. WC loan is Rs 6 crore which is intact. Term loan is on yearly repayment basis. The fall in interest cost is due to timely repayment. The company does not plan to raise any long term debt. Long term debt should be fully paid by FY 2018
F&B business has outperformed room revenues.
The company's focus is hugely on F&B side. It is expanding in 8 locations in F&B business which have very good outlook for F&B business. This business the company can target for entire year.
Out of the total sales of Rs 70 crore sales, room revenue accounted for Rs 16 crore and Rs 17.5 crore came from F&B side and the balance came from room chartering.
RoCE in only room chartering business is more than 40%.
The company does not see any trend reversal in growth rates of room chartering business.
The company is going to add 8 more properties in next 2 years time.
After investing in owned and lease business the company will still have capital for room chartering business.
In O&L the company had occupancy of 69%.
Thane is a huge property and will add very good value into the company.
The 8 properties that the company plans to add are in Mahabaleshwar, Dalhousie, Chandigarh, Jodhpur, Udaipur, Darjeeling, Gangtok and Mahabaleshwar. If the company finalises all the top properties that it wants in these places it will add 550 rooms by 2018 and if it has to go for second best option, it will add 450 rooms.