Elegant Hotels sees FY results in line with market view

Elegant Hotels Group expects its FY results will be in line with market expectations.

It announced in August that its recent acquisition, Waves Hotel and Spa, is now open for business, having been extensively redesigned and refurbished after it was bought by the Group for $18.0m in March 2016.

"Early feedback from both customers and travel agents has been positive and, as expected, the property is already proving to be highly complementary to the existing portfolio," the company said.

"The Board expects Waves to be earnings enhancing for the Group in FY17, with excellent potential for further improvement in FY18 and beyond as the property develops its reputation.

"The Company is also pleased to announce today that it has reached an agreement in principle to bring a 123-room luxury hotel in Antigua into Elegant Hotels' portfolio under a management contract (the "New Management Contract").

"The hotel is currently under construction and is expected to open its doors in mid to late 2017. This will be Elegant Hotels' first property outside Barbados and its first management contract, and it is expected to be earnings enhancing in FY18.

"The Board believes that management contracts of this kind represent a compelling opportunity to expand beyond Barbados, given they require far less capital investment than full ownership, and is therefore considering a number of other similar targets.

"The 193 rooms that will be added to Elegant Hotels' portfolio as a result of the Waves acquisition and the New Management Contract represent a 40% increase (from 483 to 676) since the Company's admission to AIM in May 2015.

"The Board believes that the longer-term benefits from these and future additions to the portfolio justify the extra cost base that has been required to gear the Company for growth. In order to support this continued expansion, the head office team has been strengthened across the areas of finance, operational management and marketing, which has increased central costs in advance of revenues.

"During the year, Elegant Hotels' continued focus on quality and service has been reflected in the numerous awards that each of its hotels has received. Most recently, Elegant won the best practices of Sales and Marketing Award at the Caribbean Hotel Information Exchange Forum.

"In addition, all of its properties apart from Waves (which has only recently come under the Group's ownership) were awarded TripAdvisor's coveted Certificate of Excellence for 2016, as well as the prestigious Green Globe Certificate."