Pandox plans for acquisitions

The Crowne Plaza Brussels - Le Palace (Pandox)

Pandox adjusted its dividend to allow it to increase its “capacity for future acquisitions and investments”.

The company said that it saw conditions for growth this year, while “opportunities for acquisitions and investments remain positive”.

During the fourth quarter the company raised SKr3bn (€283m) through a share issue, with around 130 selected Swedish and international institutional investors subscribing.

CEO Anders Nissen said: “Conditions for the hotel market are generally sound. Forward-looking economic indicators for the world economy have gradually improved and the positive long-term drivers for the hotel market remain intact. Underlying hotel demand remains positive, but revpar growth is constrained by increased hotel supply.

“Based on a well-diversified portfolio with balanced demand from many different guest segments and a positive contribution from recently completed acquisitions, Pandox sees conditions for growth in 2020. Opportunities for acquisitions and investments remain positive. Taking the external environment and planned investments, mainly in operator activities, into consideration, the earnings development between quarters may, however, be somewhat uneven.

“Based on available data, the Corona virus outbreak is expected to have a slight dampening effect on demand, particularly in international destinations. No considerable calendar effects from the timing of Easter are expected in the first quarter.”

The company reported fourth-quarter Ebitda up 11% to SKr831m. In 2019 Pandox entered into acquisition agreements for a total of 13 hotel properties, 11 of which were in the property management business segment and two in operator activities, with a total of 2,834 rooms in regional hubs in Germany and the Netherlands. The total acquisition value was around €537m with an initial valuation yield in the range of around 5.4% to 6.5%.