Rezidor
Hotel Group AB
FY 2010
Mars 2011
Top 10 Hotels Players in Europe
Rezidor ranks 5th in number of rooms, first on the upscale segment
(with its brand Radisson Blu)
As of Dec. 2010
Rank 2010
Hotel Network
Group
1
Accor
2,368 h.
260 kr.
2
Best Western(1)
1,360 h.
93 kr.
3
Intercontinental
590 h.
92 kr.
4
Louvre Hotels
947 h.
67 kr.
5
Rezidor
276 h.
57 kr.
6
NH Hoteles
361 h.
52 kr.
7
Sol Melia
214 h.
47 kr.
8
TUI (1)
182 h.
46 kr.
9
Hilton Worldwide
193 h.
45 kr.
10
Whitbread PLC
592 h.
43 kr.
Only Midscale
(1)
(1)
Resort
Resort
(1)
Only UK
Sources: MKG Hospitality – Feb. 2011, Companies annual reports 2010 and corporate website
2
(1)
Nb of rooms based on internal estimates
Rezidor Hotel Group AB.
Summary
3
1.
Company overview
Slide 3
2.
Company organization
Slide 4
3.
Brands positioning
Slide 5
4.
Geographical breakdown
Slide 6
5.
Operating mode
Slide 7
6.
Group strategy
Slide 8
7.
Pipeline and lodging development
Slide 10
8.
Key figures
Slide 11
9.
SWOT analysis
Slide 13
10.
Company history
Slide 14
11.
Brands description
Slide 15
Rezidor – Company profile
FY 2010
segment # hotels # rooms
Mid/Ups
1. Company overview
312
ADR
OR
62.3%
99.5€
66,375
Revpar
62€
Description
Main Shareholders
– Rezidor is a Hospitality Swedish company operating
in the traditional lodging industry
– Listed on the NASDAQ OMX Stockholm Exchange on
November 2006
– Three main brands: Radisson Blu, Park Inn by Radisson
and Hotel Missoni
– Asset-light business model
– 4,947 employees
Owners
– Fifth hotel player in Europe (in nb of rooms)
– Radisson: largest upscale hotel brand, according to
MKG
– Segmented portfolio: Luxury/Lifestyle (Hotel Missoni),
Upscale (Radisson Blu), Midscale (Park Inn by
Radisson), Limited service (Country Inn)
– Presence in 48 countries through EMEA
Stake
Float
49%
Carlson Companies
Nordea Investment Management
Swedbank
50%
12%
7%
– Radisson Blu and Park Inn by Radisson developed in
EMEA under Master Franchise Agreements with
Carlson
Main Figures
2009
2010
Segmental Revenue and EBITDA
2011E
Revenue
2012E
3%
Financials (M€)
Revenue
% Change in Revenue
EBITDA
EBITDA margin
Net Profit
Net margin
677
786
871
942
-13.8%
16.1%
10.8%
8.2%
5
32
64
111
0.7%
4.1%
7.3%
-28
-3
23
48
NA
NA
2.6%
5.1%
3%
Market Cap
55%
51%
23%
11.8%
Nordic Europe(2)
Western Europe
Eastern Europe
MEA
718
Network
286
60,646
312
66,375
M arket Data as o f A pril 28, 2011
4
Sources: Reuters as of 28 April 2011, Rezidor
Annual Report 2010, Rezidor website
22%
43%
Market Data (M€)
Hotels
Rooms
EBITDA (1)
Nordic Europe (2)
Western Europe
Eastern Europe
MEA
(1)
Excluding Western Europe negative EBITDA (-€4.6m)
(2)
Incl. Denmark, Finland, Iceland, Norway and Sweden
Rezidor – Company profile
FY 2010
2. Company organization
Group companies and legal structures
Rezidor Hotel Group AB
(Sweden)
100% shares and votes
Rezidor Hotel Holding AB
(Sweden)
100% shares and votes
Rezidor Hospitality A/S
(Denmark)
100% shares and votes
100%
100%
Rezidor Hotels
ApS Danmark
(Denmark)
100%
Rezidor
Russia A/S
(Denmark)
Sources: Company reports
5
100%
Rezidor
Regent A/S
(Denmark)
100%
Rezidor
Sweden AB
(Sweden)
100%
Rezidor
Comerstone A/S
(Denmark)
100%
Rezidor
Park ApS
(Denmark)
100%
Rezidor Hospitality
Norway AS
(Norway)
Rezidor – Company profile
FY 2010
Rezidor Loyalty
Management A/S
(Denmark)
100%
Rezidor
Country A/S
(Denmark)
100%
Rezidor
Lifestyle A/S
(Denmark)
3. Brand positioning
Hotels / rooms / countries
Luxury
(% of room network)
1 h. / 136 r. / 1 c.
Upscale
(% of room network)
200 h. / 46,122 r. / 48 c.
(2)
Midscale
(% of room network)
103 h. / 19,232 r. / 26 c.
(1)
Economy
(% of room network)
2 h. / 133 r. / 2 c.
Source: Rezidor Annual Report 2010
Full Service
NB: 6 Regent hotels included in Other hotels in Annual Report
6
(1)
2 Country Inn hotels in EMEA (Germany and Austria)
Limited Service
Rezidor – Company profile
FY 2010
4. Geographical breakdown
Hotel and room network
As of December 31st, 2010
312 h, 66,375 r
Nordic Europe
20%
56h
12,945r
23%
Eastern Europe
44%
160 h
29,406r
Western
Europe
13%
Share of
global
X%
network
(in nb of r)
7
Source: Rezidor Annual Report 2010
Middle-East, Africa & Others
Rezidor – Company profile
FY 2010
36 h
8,953r
60 h
15,071r
5. Operating mode
2002
2010
133 h. / 28,900 r.
312 h. / 66,375 r.
1%
20%
29%
29%
54%
41%
+37,745 rooms
+130% over 8 years
Owned
Source: Rezidor Annual Report 2002 & 2010
8
Leased
Managed
Rezidor – Company profile
FY 2010
Franchised
26%
6. Group strategy
Important developments of the year
Brand
strategy

Park Inn by Radisson
– New name launched in Q2 2010
– Link with Radisson’s brand image to enhance further growth

Sale of Regent
– Positive effect of M€ 5.7
M&A
– Management services still provided to Regent hotels after sale

Development
strategy
Portfolio agreement in the Baltics
– Agreement to re-brand 10 Reval hotels (ca 2,400 rooms) in the Baltics to Radisson Blu and
Park Inn
– Agreement to strengthen Rezidor’s position in the key markets Riga, Tallinn and Vilnius

Ownership
Carlson’s shareholding
– Carlson, Rezidor’s major shareholder, has increased its shareholding to 50.03% of the registered
shares in May 2010
Source: Rezidor Annual Report 2010
9
Rezidor – Company profile
FY 2010
6. Group strategy
Strategic axes

Margin improvement: EBITDA target margin of 12%
– Tight cost control (following the cost reduction program of 2009)
– Substantial increase in cash flow in 2010 allows increase in maintenance Capex
– Fixed-lease structure to be maintained in Western Europe

Asset light strategy
– Increasing proportion of managed and franchised hotels (95% of the pipeline vs. 74% of the actual
portfolio)
– Hotels conversions privileged in some specific markets such as UK, Germany and Russia for Park Inn
brand, while Radisson Blu expansion mainly through new builds

Focus on expansion of core brands: Radisson Blu, Park Inn by Radisson
– Disposal of peripheral assets: sale of Regent luxury brand to Formosa in April 2010
– Key priority to boost brand awareness as a mean to increase RevPar penetration: new name for Park
Inn followed by a major new marketing and sales campaign in 2011, mainly in UK

Expansion plans in emerging countries
– Focus on Russia/CIS and Africa: strong economic growth, undersupply or old inventory combined with
high room demand and low operating costs
– Emerging markets represent over 70% of the pipeline (vs. 36% of rooms in operation)
– Radisson Blu: key to entering new markets, Park Inn usually following the footsteps of Radisson Blu
– Rezidor is considering to enter the economic segment in Middle East, Russia and Africa under a new
brand*.
10
Sources: Rezidor Annual Report 2010
*Press review as of March, 2011
Rezidor – Company profile
FY 2010
7. Pipeline and lodging development
Business Development in 2010
•
Openings: +7,173 r. (32 h.)
•
Closings: -1,444 r. (6 h.)
•
Net evolution: +5,279 r. (+9,4%)
Pipeline 2011-2015 : 21,493 additional rooms (32% of the current network), incl. 8100
new rooms signed in 2010
Per region
Per brand
Per contract type
3%
9%
37%
8% 4%
20%
34%
63%
88%
34%
Nordic Europe
Radisson
Leased
Western Europe
Park Inn
Managed
Eastern Europe
Missoni
Franchised
Two core brands:
Radisson Blu and Park Inn
by Radisson
+95% current pipeline
managed & franchised
MEA
Focus on Eastern Europe
and MEA
Source: Rezidor Annual Report 2010
11
Rezidor – Company profile
FY 2010
8. Key figures
P&L evolution & forecasts
Financials (in M€)
Revenue
2003A
390
2004A
499
2005A
587
2006A
707
2007A
785
2008A
785
2009A
677
2010A
786
2011E
871
% Change in Revenue
EBITDA
NA
27,9%
17,6%
20,4%
11,0%
0,0%
-13,8%
16,1%
10,8%
(12)
21
44
51
81
70
5
32
64
111
NA
4,2%
7,5%
7,2%
10,3%
8,9%
0,7%
4,1%
7,3%
11,8%
(33)
4
18
21
46
26
(28)
(3)
23
48
NA
0,8%
3,1%
3,0%
5,9%
3,3%
NA
NA
2,6%
5,1%
EBITDA margin
Net Profit
2012E CAGR 2003-2010
942
10,5%
Net margin
8,2%
NA
NA
So urces: co mpany repo rts and Reuters co nsensus estimates as o f M arch 16, 2011
1 000
15%
900
13%
800
11%
700
9%
600
7%
500
5%
400
3%
300
200
1%
100
-1%
0
-3%
2003A
2004A
2005A
2006A
2007A
Revenue
12
2008A
2009A
2010A
EBITDA margin
Rezidor – Company profile
FY 2010
2011E
2012E
Net margin
9. SWOT analysis
Strength
Weaknesses
– Strong support of the worldwide group Carlson,
which owns 50.1% of the company
– Large product range, from midscale to luxury
– Large brand awareness in Scandinavia
– Leadership in Scandinavia
– Good business model (upscale with maximum
pricing power, strong operating leverage, no debt,
well positioned to win management contracts)
–
–
–
–
Geographical footprint limited to EMEA
Expensive lease commitments
Dependence on Carlson
Poor business control, especially as Rezidor
pursues an aggressive growth plan
– Bad ratings in customer satisfaction surveys
– Difficulties in securing new hotel contracts or
keeping/prolonging maturing contracts
Opportunities
Threats
– Improving business mix (asset light
management contracts)
– Well positioned for recovery, thanks to costs
measures implemented in 2009
– Growing share of the branded hotels trend for
conversion from unbranded to branded hotels
– Strong room rollout potential
– Central and Eastern Europe as one of the
world’s fastest emerging travel markets
Source: Broker research, June 2010
13
– Intense competition, with a large number of
players, especially in Europe
Rezidor – Company profile
FY 2010
10. Company history
14
2010
Sale of Regent Hotels to Formosa
2009
Radisson SAS becomes Radisson Blu
2006
Rezidor goes public on the Stockholm Stock Exchange
2005
Hotel Missoni is launched, in partnership with the Italian fashion brand of the same name
2002
Multi brand franchised master agreement, adding 3 other Carlson’s brands to Rezidor Portfolio:
Regent, Park Inn and Country Inn
2001
SAS International Hotel becomes Rezidor
1994
First master franchise agreement with Carlson
Radisson SAS is born
1980
First hotel outside Scandinavia: SAS Hotel Kuwait
1960
Scandinavian Airlines founds the company SAS International Hotels by opening its first hotel, the
SAS Royal Hotel in Copenhagen
Source: Rezidor Website
Rezidor – Company profile
FY 2010
11. Brands description
Hotel Missoni
Full Service
Radisson
Park Inn by Radisson
Limited Service
15
Source: Rezidor Annual Report 2010
Country Inn
Rezidor – Company profile
FY 2010
11. Brands description
Full service – Hotel Missoni
Overview
Network
Full service, upper upscale brand
Network
►Focusing on lifestyle and design aspects
►License agreement with the italian fashion house
of the same name
►Woldwide licensing agreement
►First Hotel opening in 2009
►2 hotels, 305 r. (incl. newly opened Missoni
Kuwait City)
►Pipeline = 3 hotels / 508 rooms
Locations
Main competitors
► Fashionable cities as well as in up-and-coming
resort areas
► So by Sofitel, W, Morgans, Malmaison, Bulgari,
Armani
►Geographical breakdown
►Worldwide, with a focus on Europe and the
Middle East
►Two hotels operated in Edinburgh and Kuwait
►Future openings include Oman, South Africa,
Brazil
16
Source: Rezidor Website
Rezidor – Company profile
FY 2010
11. Brands description
Full service – Radisson Blu
Overview
Network
Full service, upscale brand
Network
►Largest Rezidor hotel brand
►Largest upscale hotel brand in Europe
►Ranging from small boutique hotels to major city
landmarks
►Managed / Leased contracts
►Trademark of Carlson, master franchise agreement
with Carlson until 2032, with the option to extend the
agreement until 2052
►200 hotels / 46,122 rooms in operation
= 230 rooms per hotel on average
►Pipeline: 52 hotels / 12,922 rooms
Locations
► Mainly located in city centers, leisure resorts
and airports
New architecture and design policy
►Rebranded as Radisson Blu in 2009
Key figures
FY 2010
FY 2009
►ADR: €110.3
► ADR: €105.95
►RevPar: €70.5
►RevPar: €65.9
►Occupancy Rate: 63.9% ►Occupancy Rate: 62.2%
Main competitors
► Pullman, Hilton, Marriott H&R, Sheraton
17
Source: Rezidor Annual Report 2010, Rezidor Website
Rezidor – Company profile
FY 2010
11. Brands description
Full service – Park Inn (1/2)
Overview
Network
Full service, midscale brand
Network
►New name to be used from January 2011: Park Inn
by Radisson
►Mainly operated under franchise agreements
►Targeted markets: UK, Germany and Russia
(growth mainly driven by conversion)
►Trademark of Carlson, master franchise agreement
with Carlson until 2032, with the option to extend the
agreement until 2052
Key figures
FY 2010
►87 hotels / 16,121 rooms in operation
= 185 rooms per hotel on average
►Pipeline = 51 hotels / 9,408 rooms
Locations
►City centers, suburban locations and transport
terminals
FY 2009
► ADR: €63.8
►ADR: €64.5
►RevPar: €33.6
►RevPar: €37.5
►Occupancy Rate: 58.0% ►Occupancy Rate: 52.6%
Main competitors
► Novotel, Scandic, Holiday Inn
18
Source: Rezidor Annual Report 2010, Rezidor Website
Rezidor – Company profile
FY 2010
11. Brands description
Park Inn (2/2) : affiliation brand strategy case study

Park Inn by Radisson is a “fresh and energetic” midscale hotel brand (119 hotels / 85% in Europe)

Relaunched in 2003, stand-alone brand until 2010, when an affiliation to Radisson was decided (starting Jan 2011)

New name is in line with Rezidor decision to focus its dvlp on its two core brands, Radisson and Park Inn

Objectives : The link with Radisson and its great strength and reputation will allow Park Inn to grow faster and to
increase the brand awareness. But no repositioning / upgrade seems to be planned.

Implementation Plan :
– The rebranding process will start in Park Inn’s key home market, the United Kingdom, before extending the process across Europe,
Middle East and Africa.
– The transition of Park Inn hotels to Park Inn by Radisson will be completed by the end of 2011.
– First Park Inn by Radisson in Brazil, developed by Atlantica Hotels International

Pipeline1 : 41 in EMEA, 3 in North America , 2 in APAC (India), 2 in Latin America
2000
• Carlson acquires the
Park Inn brand from
Olympus
Hospitality Group
19
1
2002
• Carlson signs a
master franchise
agreement with The
Rezidor Hotel
Group to develop
Park Inn in EMEA
Lodging Econometrics Q4 2010
2003
• Rezidor relaunches
Park Inn. First hotel
in Berlin
2010
• Rebranding operation to
Park Inn by Radisson to
enhance further growth
11. Brands description
Limited service – Country Inn
Overview
Network
Limited service, economy brand
Network
► Brand under development, currently under review
by Rezidor
►Trademark of Carlson, master franchise agreement
with Carlson until 2032, with the option to extend the
agreement until 2052
►2 hotels / 133 rooms in operation
Geographical Breakdown
Main competitors
►Germany
►Austria
► Ibis
20
Source: Rezidor Annual Report 2010, Rezidor Website
Rezidor – Company profile
FY 2010