PPHE Hotel Group (LON:PPH) tumbled on Thursday after the company posted a wider first-half loss and cut its full-year earnings guidance, despite revenue growth. Shares fell 10%.
Revenue rose 4.7% to £199.9 million in the six months to June, up from £191 million a year earlier. However, pretax loss widened to £10.3 million from £1.3 million as operating costs climbed 8.2% to £153.1 million and financial expenses rose 18% to £22.6 million.
Margins were squeezed by weaker room rates and inflation, though efficiency measures helped offset wage and social security pressures. Interim dividend was held steady at 17p per share.
Like-for-like revenue edged up 1.3% to £193.3 million, while revenue per available room improved 1.4% to £109.3. Occupancy strengthened, though average room rates softened.
Ebitda fell 5.7% to £45.5 million from £48.3 million, with PPHE now guiding 2025 earnings to be broadly in line with last year’s £136.5 million. This compares with prior expectations for growth and analyst forecasts of up to £158.6 million.
The company highlighted new openings and acquisitions as long-term drivers, saying pipeline projects should add at least £25 million of incremental Ebitda once fully stabilised.
Co-CEO Greg Hegarty said occupancy gains and development progress were encouraging but acknowledged persistent macroeconomic and cost headwinds, including potential VAT increases in the Netherlands and higher UK business rates.