Meliá Hotels and NH Hotel Group: to recover the lost tourist

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Difficult, very difficult that 2021 does not escape us, so, as good strategists, they already think in 2022 and how to weather these months that won’t be easy until the recovery of the tourist occurs in its broadest expression. This is the harsh digestion of the pandemic who are living from the tourism sector, but especially from the hotel sector.

Survival, and at the same time, the need to grow forces them to search for new formulas, dispositions and formats, while openings occur with droppers in places, where, as they recognize, it is profitable for them to reopen the doors of their hotels.

For Melia Hotels and NH Hoteles, this adaptation is not proving easy. The first one already sees the glass half full, but in 2022, in which the tourists that Spain does not have will have to fight one by one: that 2019 record that will be difficult to recover. And there is a fundamental counterpoint in the fall of almost 71% in April, the latest data from the INE, in hotel overnight stays and 91% fewer travelers compared to the almost 83.7 million travelers received two years ago, before the pandemic.

But as Judit Montoriol-Garriga tells us from CaixaBank Research, in her analysis of the quality of the tourist offer, the hotel groups listed on the Spanish stock market have a great international presence: around 75% of its income comes from the rest of the world. And since we are talking about a global pandemic with ad hoc restrictions in each country, things get complicated.

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But both Meliá and NH Hotel have already done their homework. The first will open 55 stores by 2023 but in the asset light mode, not very capital intensive, while NH, after the ERE carried out, has reinforced the opening of 15 new hotels a month ago and is in advanced negotiations to sell the Hotel Calderón for 125 million under the structure of sale and leasebank.

At the moment in the market, Melia Hotels fare better than NH Hotel Group. The first rises so far this year by 18.35% and the second by 12.21%. Both fell in the last full month above 3 and 4% respectively, pending the clarification of the panorama with tourism. Meliá Hotels, with two consecutive sessions down in the market, while NH Hotel accumulated cuts in six days, with a negative baggage of 2.82%.

Regarding its treasury, now in July Melia Hotels expects to go from consuming to generating cash, thinking of selling if necessary to reduce its debt level. The company spends, according to Sabadell 47 million per month. For its part, NH Hotel Group has just placed senior guaranteed bonds worth € 400 million and maturity in July 2026. Funds that will be used to amortize the senior bond that now exists, for a value of 357 million and maturity in 2023. The new issue, in which a relevant oversubscription has been obtained, has an annual coupon of 4 %, and allows the company extend the maturity of your debt for up to five years.

For Sabadell, the truth is that this is positive news because it allows you to strengthen your capital structure in the face of the beginning of the recovery. Thus, the group does not have significant short-term maturities and has high liquidity: 236 million in cash after closing the first quarter of the year, 100 million from a Minor loan, which will be capitalized in the second quarter of the year and 125 million for that. asset turnover referred to earlier.

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That will allow you to last up to 15 months in a scenario such as the one experienced until March 2021, in an environment that is already expected, in the second part of the year, in the third quarter, of a strong recovery in operations.

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