Pandox AB (publ)

The Pandox Q1 presentation for 2025. During the questions and answers session, participants are able to ask questions by dialing pound key five on their telephone keypad. Now I will hand the conference over to head of IR and communication Anders Berg. Please go ahead.

Thank you. Good morning and welcome to this presentation of Pandox Interim Report for the first quarter 2025. I'm here together with Lian Hu, our CEO and Anneli Lindblom, our CFO. And today we also have the pleasure of having both Alex Robinson, Director at STR and Rasmus Kjellman, Managing Director at Benchmarking Alliance with us. Alex and Rasmus will provide a hotel market update on Europe and Nordics respectively, which is particularly interesting given the current geoeconomical changes around the globe. STR and Benchmarking Alliance are both leading independent research firms dedicated to the hotel market. And the views they express are completely separate from Pandox. And the presentations are offered only as a service to Pandox stakeholders. And Alex and Rasmus presentations will be held after we have completed our formal earnings presentation, including the Q&A. So now we start with Lian and Anneli's business updates and the financial highlights for the first quarter 2025, followed by the Q&A session. Yes, via please go ahead.

Thank you, Anders. And good morning and welcome everyone. The first quarter was stable with continued earnings growth for the group. Total revenues increased by 1%, net operating income by 5% and cash earnings in total increased by 10% and by share by 4%. Taking into account the one-off revenue last year of 40 million, then total revenues increased by 4%. The business segment leases saw a stable performance. Again, adjusted for a one-time revenue of 40 million kroner for Kölnborn Airport and a one-time cost of 38 million for business development in the comparable quarter. Revenue and net operating income increased by 6% respectively. I also wanna say that note that an additional final 22 million of one-off revenue related to Kölnborn Airport came in in the second quarter last year. Own operations was negatively affected by slower demand, particularly in Brussels and also some negative renovation effects. The first quarter is always smaller because of seasonality and slower demand can have an un-proportional big impact on profitability in own operations. The business outlook for the coming quarters in own operations is positive. One thing to note is that the Swedish Krona appreciated in the value quite strongly towards the end of the first quarter. This resulted in large negative translation effects for properties denominated in foreign currencies, which in turn explains the full decrease in EPRNRV per share in the quarter. Unrealized changes in values for the whole portfolio amounted to a positive 40 million Kroner and the weighted yield was more or less unchanged at 6.28%. And also our average interest rate came in at 3.9%, giving us a solid positive yield spread of close to 240 basis points. During the quarter, our business tempo was high with the acquisition of Hotel Pullman Cologne in Germany and Elite Hotel Frost in Kirona in Sweden, which I will come back to later in this presentation. We also signed a new lease in Brussels for Hotel Hubert with German hotel operator Numa, which came into force 1st of April and the hotel property was reclassified to leases also 1st of April. This new lease agreement will lead to a tangible value uplift for the hotel property in the second quarter. And the quarter, our loan to value was .7% and if we include the paid dividends and the finalized acquisition in Germany, both in April, the loan to value was 47.4%. The world is a turbulent place. We focus on the data and the things we can affect in our business every day and our financial position is solid. Here we have a breakdown of the performance for a selection of countries, regions and cities versus last year, 2024. We show average daily rate on the vertical axis and occupancy on the horizontal axis. Thus, Oregon is the point corresponding to 2024 on both ADR and occupancy. In the boxes, we indicate how much higher or lower Revpar is compared with the corresponding period 2024. As you can see in the first quarter, Revpar increased in a majority of our markets, mostly driven by increased occupancy while average prices were more varied. In terms of Revpar, the greatest relative improvements in the first quarter took place in Nordic regional markets with Norway as a really strong leader. Oslo, Copenhagen and Hannover were also strong city markets. However, several important markets for pandocs were slower in the first quarter and most notably Brussels, where there has been a lot of new capacity coming in. Alex Robertson from SDR and Erasmus Kjellman from Benchmark Alliance will talk more about the underlying trends in the hotel market later in this call. We have a strong and well diversified hotel property portfolio consisting of 162 hotel properties with approximately 36,000 rooms in 11 countries and 90 cities and with a property market value of close to 74 billion kroner with an average yield of close to 6.3%. And please note that the Hotel Pullman Cologne is not included in the total property portfolio and it has not been included since the transaction was closed first of April. And then we have yet to formally finalize the acquisition of Elite Hotel Frost in Kiruna, Sweden. We are divided into two mutually supportive and reinforcing business segments, leases and own operations. In leases where we own and lease out hotel properties stands for 79% of our property market value. In own operations, we transform and run hotels in properties we own. Own operations makes up for 21% of our property market value. And the focus of our portfolio is upper mid-market hotels with mostly domestic demand, which is the backbone of the hotel market regardless of which phase of the hotel market cycle is in. We also have the strongest networks of brands and partners in the hotel property industry. This ensures efficient operations and revenue management which maximize cashflow and property values and a continuous flow of business opportunities. Also, a relatively large part of the investment leases is shared with the tenant, which lowers our risk. Numa from Germany is our most recent partner edition and we would like to wish them a warm welcome to the Pandocs ecosystem. Including Elite Hotel Frost in Kiruna, which will be finalized later in the second quarter, we have acquired six hotel properties with a total value of some 5.5 billion kroner over the past eight months. These are well-performing city hotels with strong brands and distribution while offering some additional improvement potential. I will present the two most recent editions on the following slides. On April 1st, we finalized the acquisition of Hotel Pullman Cologne in Germany. It's a well-positioned city center hotel, which is operated by Core Invest under a fixed lease, which expires end of 2026. We acquired it for 66 million euros at an initial yield of 6.5%. We see potential to further increase the return and reach a higher stabilized yield. Cologne is an interesting market, which is gradually attracting more leisure demand on top of the more traditional business and trade fair demand. And we now have four hotel properties in Cologne with a total of 995 rooms. And this is beautiful Elite Hotel Frost in Kiruna, Sweden, which we entered into an agreement to acquire in March. It's newly built hotel, which will be operated by Elite Hotels under revenue-based lease with minimum guarantee address. We expect the transaction to be finalized towards the end of the second quarter when the hotel also opens for the first time. The acquisition price is 347 million kroner and we expect it to reach a stabilized yield of 7%. The acquisition is well aligned with our view on the northern part of the Nordic area as an attractive region with a growing demand from both domestic and international leisure travels, looking for unique nature experiences. We focus on maximizing the value of each individual hotel property. We do this by creating attractive hotel products and properties based on the uniqueness of each property. Own operation is an important transformation tool. It gives us flexibility in acquisitions and enables us to drive change at a high speed. And perhaps most important for us, optionality by itself. It's a key value driver and we work actively to maximize it, all with the objective to create continuous value growth. And on the following slides, I will show you a few examples of recent investment projects in our standing portfolio. The first project is a comprehensive upgrade of Leonardo Royal Hotel Baden-Baden, which featured a new spa area and renovation of both rooms and public areas. The project was completed in the first quarter, Baden-Baden is an iconic wellness destination in Germany, dominated by leisure demand. The new product has been very well received by guests and the hotel property belongs to the business area, Lises. The second project is a room, bathroom and technical upgrade of Leonardo Royal Frankfurt. Rooms and bathrooms were completed also in the first quarter, 2025, and technical investments will be completed in the second quarter this year. Frankfurt is a strong business meeting and trade fair destination with mostly business demand. Also here, the new product has been very well received by guests and the hotel property is also part of the business area, Lises. The third project is a spa area development on two floors at the Vildmarks Hotel at Kolmården in Sweden. In addition, the hotel's energy systems have been completely upgraded with heat pumps. And the project was also completed in the first quarter of 2025. Kolmården houses Sweden's largest animal park and is a strong leisure destination, particularly in the summer season. With the development of the spa, Vildmarks Hotel will improve its possibilities to capture more demand also during seasons where the animal park is closed. The hotel property is again part of the business area, Lises. And the fourth project, which I will present here, is the refurbishment of the Hotel Brussels, which includes a mini spa on the top floor, renovation of rooms and the addition of five new guest rooms. The spa was completed again in Q1 this year, while room upgrades will be finalized during the summer. Brussels is one of the most international hotel markets in Europe. It has traditionally been dominated by EU, non-government organizations and business demand. But in recent years, leisure demand has steadily increased. The hotel property is part of the business area, Oon Operations. And with that, I hand over to Ann-Li Linbom, our CFO.

Thank you, Lea. So good morning, everyone. In the first quarter, group net operating income increased by 5%, driven by the acquisitions and stable performance in the lease business segment. Oon Operations had weaker stock to the year due to a slower hotel market in mainly Brussels and some renovation and reclassification effects. The first quarter is always weaker because of seasonality and slower demand can have an unproportional big impact on profitability in Oon Operations. We have estimate that the timing of Easter, compared with last year, was largely neutralized by the loss of one day due to the leap year in the first quarter last year. Cash earnings and profit before changes in value both increased by 10% and cash earnings per share increased by 4%. Now, a few words on currency. To reduce the currency exposure in foreign investments, PANDOK's aim is to finance the investment in local currency. Equity is normally not hedged as PANDOK's strategy is to have a long investment perspective. Currency exposures are largely in form of currency translation effects. In the first quarter, currency was neutral measured on average rate, which we use for the income statement, but negative measured on end of period rates, which are used for the balance sheet. As you know, we have the main part of our hotel properties outside Sweden and denominated in foreign currencies. This explains the negative effect on property values and EPRANRV based on the balance sheet. Based on the current level of exchange rates, it is likely average rate will be lower in the second quarter, with some negative translation effects on our income statement in the second quarter. On this slide, we showed the change in the main valuation parameters for the total property portfolio year to date. And please remember that the investment properties are recognized at fair value, but according to IFRS, unrealized changes in value for operating properties are only reported for information purpose and is included in EPRANRV. In the first quarter, 2025, the total unrealized changes in value were a positive 14 million. The first quarter is always a weaker quarter with limited read through for the rest of the year. As I said earlier, changes in currency had a negative impact on the balance sheet items with a decline in property value of minus 3.4 billion in the first quarter. In the quarter, we gained access to Reddison Blue Tromsø with a transaction value of 750 million Norwegian crowns. We also signed an agreement to acquire Hotel Pullman Cologne, but this transaction was not closed until 1st of April, so this one will be seen in the second quarter. We also signed an agreement to acquire Elite Hotel Frosting Kiruna, as Leah said, which is expected to be completed during the second quarter. End of period, the average valuation yield for investment properties was 6.13, and for operating property, it was 6.89%. The blended yield was 6.28%. Here we have the average yield, the average interest on debt and EPRNRV per share quarterly from the end of 2019. Despite higher yields and higher market interest rates, EPRNRV per share has increased compared with 2019, and we have a tangible and positive yield spread of around 240 basis points. In the first quarter, growth in EPRNRV was positive, .5% measured on an annual basis adjusted for paid dividend and proceeds from the new share issue. Our LTV at the end of the quarter amounted to 45.7%, which pushed us firmly at the lower end of our policy range, including the acquisition of Hotel Pullman Cologne completed 1st of April and the dividend paid in mid-April, the LTV is 47.4%. The ICR on a rolling .5% was 45.7%. The current amount basis was flat, that was 2.7 times on a sequential basis. Cash and credit facilities amounted to 3.4 billion. And on top of that, we still have unencumbered assets of some 1.4 billion as an untapped reserve. During the quarter, the positive trend from last year continued with a constructive financing climate with gradually lower credit margins. In the first quarter, we refinanced loans of 428 million, which makes it close to 18 billion refinanced over the last 12 months. And we now have at the end of the quarter, 42% of total outstanding loans sustainability linked. Looking ahead, we have 3.4 billion on debt maturing within one year of which the major part is in the second quarter 2025. And we have strong and expanding bank relations across our markets and discussions on future financing and refinance are ongoing and positive. At the moment, 67% of the net debt is hedged, which means that the effect from moment in market rates remains relatively slow. And with that, I will hand back to Leah for some final remarks.

Thank you, Anneli. The hotel market continues to show resilience and is supported by strong underlying growth drivers. Leisure travelers have continuously prioritized travel and experiences over other consumption and business demand have gradually recovered. The hotel market is dependent on economic activity and the current turmoil around tariffs have created some uncertainty among companies. However, so far, business on the books is stable. Although we are facing tough comps due to the Euro 2024 in Germany last year, there's a nice event calendar in the UK and the trade fair calendar in Germany is solid for the second half. Indications are that European travelers are canceling or postponing their trips to US at a much higher rate than US travelers to Europe, which so far has been stable. Some, but not all European travelers will probably reschedule the travel to other European destinations instead, which may add support to the European hotel market. As before, we also expect a positive contribution from acquisition and investments in our existing portfolio. My final note, we are committed to keeping up our positive business momentum. We focus on the data and what we can affect in our business. And we are always on the hunt for more profitable acquisitions, more high yielding investments and to create value in every part of the hotel value chain. And with that, we now move over to the Q&A. Operator, we are now ready for questions.

To ask a question, please dial pound key five on your telephone keypad. To enter the queue, if you wish to withdraw your question, please dial pound key six on your telephone keypad. The next question comes from Staffin Bulo from Nordia. Please go ahead.

Good morning and thank you. I hope that you can hear me.

Yes, we can.

Perfect. So I have a couple of questions. I think I'll ask them individually. And starting off with the outlook for repar growth, I think in the last conference call that you mentioned that you expect repar to grow zero to 4% in 2025. Do you still see that following the turbulent macro environment in Q1?

Yes, on sort of on the short term, of course, there is more uncertainty, but there is nothing supporting otherwise so far. So with the underlying trends that European travelers canceling their trips to US, US travelers to Europe is stable, even though it's expected to probably diminish a little bit. We are still sort of this, we are not changing that guidance in itself. But of course, there is, as everybody else noticed, more turmoil and uncertainty on the short term.

Okay, I see. Thank you. And also another question on demand, so to say. In Q1, we saw some US airline companies lower their guidance and they mainly commented on this being driven by weaker domestic travel. But one might of course worry that this might spread to Europe. Is it sort of possible to quantify demand from domestic travelers and international travelers in your portfolio? Let's say if we would see a significant decrease of US travelers to Europe, how big is your exposure to cities with large demand from US?

Yeah, well, all in all, as you know, our portfolio is mainly domestic and local demand. So maybe 15% is international demand, whether that would be sort of intra-European, US, et cetera, et cetera. But so again, we believe that the net effect of, only in March, we saw a 17% reduction of European travelers going to US. So we think it's a net positive. But there will of course be some net balance of that. But on top of that, of course, a more unified and stronger Europe hopefully will also create more economic activity and which will sort of give more growth in Europe. So all net-net, we do expect it to be stable or positive.

Okay, interesting. And I have a question if we look into Q2 and considering Q2 last year when the European Championship took place, I'm wondering if it's reasonable to expect that we will have negative like for like growth in revenue owing to two very tough comps in Q2 last year.

Yeah, there's a lot of moving pieces, but I think what I mentioned on the call, we have the one off also in Q2 of 22 million in revenue, all related to the same one off we had in Q1 with the Köln Airport. This was related to a argument around the hotel for two or three years and we finally won that and all of that revenue was then contributed in 40 million off in Q1 and 22 million in the second quarter. We are meeting tough comps, we are meeting Euro 24, we are meeting Taylor Swift, et cetera, et cetera. But then again, business on the books and also the fair trades and the market, we do expect it to be sort of not materially different. So it will be offset, but of course we are meeting tough comps. Also in Q2 we had the sort of Easter, whereas we now have the Easter effect. But all in all, it should be sort of two dramatic changes. I don't know, Anderle, if you wanna add to that. Yeah, I think that's, I mean, it's kind of stable.

Yeah, okay, I see. Then I have a question on net operating income. I think from my point of view, net operating income from leases surprised positively and the net operating income from own operations was a bit weaker than what I expected at least. And just looking at net operating income from own operations in Q1, I think it was 87 million this quarter, 91 million one year ago, and like for like revenue was down a bit. Would you say that this is something temporarily that like for like in own operations was negative or should we extrapolate this in own operations?

No, I think then a Q1 as such is a slow quarter. We had, especially Brussels was weak quarter and slightly disappointing with a lot of more new capacity, but not in a dramatic way. What is sort of disturbing is that we had two hotels, Double G Brussels and Mayfair under renovation. We reclassified first of April Hotel Hubert to the lease segment where we signed the lease with Numa. But before that in March, the hotel was to a large extent closed. So there's a lot of moving pieces back and forth. And of course also sort of it's the slowest or the smallest quarter, meaning that fixed costs will have maybe an un-proportionate large impact. So the margin was 13%. Last year the margin was 14% in own operations. This is absolutely the slowest quarter. Business on the books when it looks coming on the next coming quarters are more in line with before.

I see that's clear, thank you. And one final question from me and that is about the outlook for acquisitions. You've announced two acquisitions in Q1 at high yields and looking into the next 12 months, do you still see similar opportunities in your graphics and at the same yields or has anything changed on the outlook for acquisitions?

No real change in acquisitions. And as I said, we are on the hunt. We like value creative acquisitions, especially UK, Germany and the Nordic region. The last turmoil is of course putting maybe the interest rates on hold, but we don't know that yet. But then again, uncertainty sometimes create even more opportunities for us to find attractive transactions. So we basically have the same, we see the same amount of opportunities going forward.

Great, thank you. Those were my questions. Thank you for answering them. Thank

you.

The next question comes from Frederick Stenzved from ABG Sundal Collier. Please go ahead.

Thank you and good morning. If we start with a couple of follow-ups on the month, Leah, you mentioned in the CEO statement that Brussels was slightly weaker in Q1 but the booking situation for Q2 is solid. Is that a Brussels specific comment or is it for the portfolio or the booking situation for the whole portfolio in general?

I think we can actually say it's the situation for the whole portfolio in general. Q1 again is a slow quarter, started out with a lot of turmoil, especially corporates maybe postpone some of the sort of group travel, et cetera. But otherwise the business on the books looks to be aligned with last year. So we are positive on that.

Perfect. And just to make sure when you refer to the booking situation, is that an occupancy figure only or is it occupancy and pricing or is it like total rep that goes into that booking figure?

Well, it's occupancy in general. But what we can see maybe is that so far with the exception of Norway, the rep bar has been sort of increasing but it's more occupancy driven than ADR driven. And you see actually some cities where ADR has actually gone down like for London, for example. But business on the books occupancy driven, absolutely.

Understood. And then a question on lending margin. You point out that new acquisitions have come with a lower credit margin and then you also point out 3.4 billion in renegotiations in the upcoming year, most of which will be in Q2, I believe if I heard you correctly. Is it possible to sort of quantify the margin potential in renegotiations, in the three and a half or 3.4 billion that's gonna be renegotiated ahead?

I mean, of course, I mean, this is loan that we are refinancing. So of course we will be aiming for better margin. But I mean, it's not, I mean, I would say a bit, I mean, it will of course effect the total margin on the group but perhaps not that heavily. I mean, we have done some refinancing but we are aiming for lower margins. So it will give effects, but I mean, it's not like a big leap down.

And if I may add to that, then of course, if you, we all remember the open quarters during the COVID. And of course, if you just look one year ago, margins have come down maybe 75 to even 100 basis points. But then again, interest rates haven't moved down as quickly and we are replacing some old interest rate hedges. So the reduced, the lower total margin of average interest cost is continuing to go down. It will be by the lower credit margins. But of course, there will be also some offsets where previous positive hedges will run out.

So you have a mix.

Perfect, understood. And then finally, or my last question, also sort of a follow-up on acquisitions. You have done acquisitions in several markets or several countries. If we look ahead, is there any market that sort of stands out as better or worse? Do you think?

Well, there's a lot of opportunities. And I usually repeat myself by saying that UK is the most transactional markets. There are more opportunities, there's more liquid markets. Then again, Sonja, the UK interest rate is 150 to 200 basis higher. So of course, you need to find those accretive transactions. So as you see, we have been acquiring last year in UK for eight, 9%, whereas we may be acquired for around 6.5, 7% in the Nordic. We are looking for everything that is accretive. And again, generally UK is more transaction basis, but it seems like both Germany and the Nordics have opened up quite a lot.

Perfect, thank you very much. That's all from me.

Thank you.

And if you wish to ask a question, please dial pound key five on your telephone keypad. No more questions at this time. So I hand the conference back to the speakers for any closing comments.

Yeah, with that, we thank you all for your questions. And now we move on to the external market presentations, starting with Alex Robinson. So please go ahead, Alex.

Good morning, everyone. And thank you very much to the Pandox team for hosting me this morning. We'll start by taking a look at hotel demand. And that's the number of rooms that we sell as a global hotel industry. And you can see here, indexed back to 2019, we continue to sell more room than we did during the biggest disruption to our industry. Onto the next view, where you'll see that while we're not hitting those double digit peaks while we were still somewhat in a position, we're still growing overall anywhere from two to 3%. Some elements of seasonality present, but overall we continue to sell more rooms as an industry. If we can translate that to a longer term trend, then I think it's important when you talk about the disruption, there's no doubt that the implications of wider macroeconomic changes, which we'll touch upon later. But here, UK gross domestic product and hotel demand. You can see it is quite an indicator of the trajectory of where we may be headed. If you think back to 2001, the end of September 11th on the aviation industry, global financial crisis, advent of Airbnb, COVID. But you can see the overall resilience here of hotel demand. And I think that's particularly important to take apart during these times. If we then take a view of occupancy by region, you can see as demand rises, so does occupancy. And I think what's important to look at, if you go back to January, 2020 to present day, we've had as many as 350,000 new hotel rooms open across Europe. So while we're selling more rooms, we're also into a bigger pool of inventory and occupancies continue to grow, which I think is very impressive indeed. If we then go ahead and turn to pricing, we'll be well familiar with double digit gains we've experienced in recent years, now to more moderate gains here today. But as those on the call have stated, the first quarter is typically a quieter one, and we wait to get into the summer season before we see more material rise in pricing. And if you do look to South America and North Africa here, you can see large double digit increases, but please know that inflation within those economies does weigh within those figures, it could be traded with a pinch of salt. If we then transition into North, East, South and West, or what we're calling the European regional divide, and we'll start by looking at that occupancies index to 2019, you can see the different groupings there, UK and Ireland already recovered, actually exceeding Southern Europe ever so close, really aided by national leisure travel, and then a number of regions notably, DOC, CE as well, which have perhaps been slower to initially recover due to not absorbing as much international demand, but to the access horizontal there, you can see those are the regions that are growing the most year on year. So really starting to provide us with the growth while other regions have recovered. Looking then to compression nights, and I think this is really key, if we were providing this presentation to you in 2018, 2019, this was what everyone at all were talking about, and for many brands, operators looking at compression nights effectively, when the market is sold out, or very close to sold out, and the good news is here, you can see the selection of key markets, there's a huge amount of nights, and while we'd love to have the championships every year, or Taylor Swift every year, even without those you can see, we're still able to drive compression, we may not be able to have quite the same level, but the markets are back, they're busy, and there's opportunities for revenue managers to maximize that profit and yield. Transitioning through to a capital and key city view there, you can see again, as we remarked, during not the busiest time, but still occupancy growth, single digit, and when you think about some of the supply, new openings across many markets, that's quite impressive indeed, when you take the likes of the Budapest, for example, you have supply growth as much as four or 5%, but still occupancy growth as much as 11. When we change views there, looking at a collection of key cities across Central and Eastern Europe, noted a moment ago that those markets and regions had been slightly slower to recover, now while Western Europe is perhaps showing single digit growth, some of these key markets here are helping to see that growth. Tbilisi, particularly impressive when you consider in recent months as much as 12% supply increase, so really impressive overall to contend with some of that new inventory coming to market. We'll then take a look at a regional overview of occupancy change by quarter, starting with the first quarter of 2024, into where we stand now at the end of Q1 2025, and no surprise there is to the Eastern Europe by far and away leading the charge in occupancy, but again, frame that in the context of being slower to recover, where we know that Western, Northern, and Southern Europe had been quicker. If we try to turn to average daily rate, standout growth for all relative to where we came from to 2019, but there's no doubt that if you look at the list of nations in the front quadrant there, that the Mediterranean is the standout, and what's particularly impressive here is if you look to the horizontal axis, you can see that the year over year growth for many of those, if you take a Greece, Spain, Portugal, still actually getting close to some double digit figures overall, the UK as well, notable as such 6%, even if trading in London was expected for the first quarter. But more on average daily rate as we head into one of the key themes, pardon me, that we see across the world as well, where we look at performance by class, and simply put, the higher the hotel class, the higher the revenue per available room. I thought it was interesting some of the remarks earlier about airlines, the US airlines in particular on their recent earnings calls and what we can expect that to mean for transatlantic demand, and from the most recent earnings calls, they remarked that in the premium or the business cabins, they're still seeing growth and it's in the main or the economy cabins where they're seeing challenges. And that also reflects the trend that we're seeing across the world and Europe, such in where luxury and upscale hotels are seeing to take a guess that's not as exposed to the challenges in the economy, whereas economy and mid-scale are indeed more exposed to a stationary traveler. But if we then turn to 2023, it's important not to forget that economy was the quickest to recover overall during the pandemic, particularly with the currency and really able to push ahead in terms of rate. So that being said, if they get to the finish line quicker and they're running that marathon a second time out, that personal best gets harder to be for some exceptional training. But if we then go ahead to full year 2024, we'll know no doubt that luxury has pushed ahead there. And you can see that Europe actually, when you compare it, with the book, has been outperforming overall. And we know that Q1, while perhaps single steady digit growth, but once we get into the summer, that's really where Europe pulls ahead from the rest of the world. If we then look at that performance by class, if you're talking about by day of week, it's clear to see for your weekday, read corporate, weekend, leisure, and then shoulder your Thursdays is that luxury is charging ahead across all of those stay patterns. And if you look at the growth composition of revenue per available room, it's very much a recipe that's weighted towards average daily rate. Occupancy plans are primarily led by average daily rate. And that's true for all classes you can see here for the full year 2024. And looking then what we can see, the overall driver of what it was for the period 2015 to 19, and then to 2024, as much as things change, they also stayed the same. You can see that rate, the primary driver of both for periods and as well for classes overall. And looking to end the section with a view on group ADRs, and I think this is an interesting one when we think about what has been a headwind for us, that is not for their group business as much as say, 80% recovered, but still yet to close that final gap. And you can see the importance of some of the events we talked about in terms of the euros, Taylor Swift, the Olympics, just how important those big, but I do think the group could be a tailwind, though notwithstanding some of the challenges that we'll touch upon in a moment. And as you can see onto the next slide there, it's very hard to open any news, the news that myself guilty on the train this morning, trying to read through the FT, almost everything you read is indeed about the tariffs in the US. And if we go ahead onto the next slide and alluded slightly in terms of the US earning schools for the major airlines is understandably so that US outbound travel to Europe is at risk. And we know how key that's been for us for many markets, particularly for the end. So if you think about some of the record seat factors that airlines are operating within, they are saying that they do anticipate some growth this year, but actually now leveling off to perhaps flat, and actually perhaps to slow down in terms of the economy cabin, but premium travel still to go ahead though, as we know, booking patterns along window, still to take stock of what the full effects may be, but absolutely one dynamic as we move throughout the rest of the year. If we then take a look at the impact on the US economy and as it relates to inflation expectations and what that may mean for Americans in terms of their sensitivity to spend some portfolios for individual 401ks and so forth anywhere from say 10 to 15% affected from what they may have been, if people feel wealthier, they're indeed more inclined to spend. So one to watch for the US traveler. But if some of those US airline calls or anything to go by and premium travel is still taking root, that's confidence that we can take forward overall. And then looking at a softening dollar, potentially the US dollar has seen record highs, which has allowed those Americans to come over and feel as though they're having their dollar go further when they spend overall. But if we look at that gap, you can still see not a huge off of those highs and the situation is ever changing indeed in the next few weeks and days could become more stable, but absolutely an element to watch overall. And we can consumer sentimentally lower the intent to travel and you can see some of that America first sentiment. And when we look at the data that STR is tracking, most of the impact we've seen is for those markets near the Canadian border. We're not seeing as many Canadians move into the US. Also markets like Las Vegas, where you have 25% of all international arrivals being Canadian has had an impact. Florida, some of those snowbird markets. So having those impacts more domestically and you hear to the right, those nations that have a higher share of US international nights and those with flags where travel guidance has been issued overall, but still very much in an early stage, still remaining at a, is bearing up to some degree in the data. It's not jumping out to any large extent at this moment in time. And if we close by looking at our forecast, our forecast here at STR every February, August and November, our forecast analysts now getting together to put together the May event, still yet to be fully quantified. And you can see here for the aggregate forecast of cities there, occupancy expected to take over as we did expect and invite some of the macroeconomic news for ADR to get back to a more single digit range of growth and occupancy pushing forward. Thank you ever so much for taking the time to join this morning and look forward to passing over. Thank you.

Hi everyone. I'm Rasmus Kjellman,

CEO of Benchmarking Alliance. And in the next 10 minutes, I will talk you through the market data specifically for the Nordics and the Baltics. And there will be a lot of data in the short period of time. So prepare for a high pace. So starting with just mentioning what Benchmarking Alliance is, we are the large supplier of daily hotel market data for the Nordics and we're founded and the team here in Stockholm. But then just starting with the Nordics and starting with looking at 2024 as a whole. It was, as you can see in the blue digits here, a good year for almost all markets with an increase in all markets. The only exception here is from the significant increases is Icelandic market that has been affected by volcanic eruptions during several periods of last year. And when we add Q1 numbers to this picture, we see the same kind of behavior and development. All markets developing, but the Icelandic market a bit slower. If we focus on the Nordic capitals, we can see that Stockholm had a fantastic year last year. We had the Taylor Swift, we have the Eco-Congress, we had Bruce Springsteen, so a really strong development for the Stockholm market. Oslo was positively affected by evenly spread out conferences in months of June and July and also September. Copenhagen had positively effect by music competitions in Malmo Eurovision Song Contest where the rates went up for that weekend by 24%. Also Helsinki, good development with the NATO conference in June and the Torsi race in July. And Reykjavik had several months of negative development but ended on the positive side. Moving to the next slide. This is an illustration that shows the development of supply at index number from 2022. So to sum up this picture, the supply in Helsinki has increased significantly during this period, while Stockholm and Oslo have had more moderate increases. And during a period of time, there were several venues in Stockholm closed for renovation. So the inventory actually decreased during that period. Moving to the next slide and looking into the details of the capitals. There are a lot of details in the graph and we will not have time to all of them but I will summarize it for you. So in Stockholm, we see a slightly increase of rev bar driven by rates. In Copenhagen, we see an increase of rev bar driven by occupancy. In Oslo, increase in rev bar driven by both rates and occupancy. Helsinki, increase in rev bar driven by occupancy and compensating for the weaker rates. And the lower rates in Helsinki is supposedly driven by increased inventory during the last year. In Reykjavik, no increase in rev bar. As increased rates were neutralized by lost occupancy. Tallinn, increase in rev bar driven by occupancy and Riga, increase in rev bar driven by both occupancy and the rates. And if we move to the next slide and see how the capitals develop when we look at both the revenue per available room and also the total revenue per available room, we can see that both Stockholm and Copenhagen, the ancillary revenue increase significantly more than the rev bar. While in Reykjavik, the total revenue is in a negative growth as a result of the volcano eruptions affecting meeting and

event

business harder.

So looking into the segments

in Stockholm, there are really no big shifts within Stockholm. Most notable is perhaps that the luxury segment is somewhat down. This is a segment that have been a strong development earlier but now is slightly down. If we in the same way look at the different segments for Oslo, we can see a generally strong market in all segments. There are shifts in available rooms but generally strong market. In the same way, looking at Copenhagen and segments here, we can see the prices in luxury is significantly up and occupancy is in budget is significantly down in both luxury and budget. So we can see somewhat of a movement in the Copenhagen market to the middle segment

here. If we look in the same

way at the Helsinki market, there is a significant increase of new rooms in the luxury segment that has been well compensated

in sales. So if we move into the

details of Sweden and start by looking at the different cities within Sweden for 2024, all these bubbles represent the different local markets. We follow 36 different local markets within Sweden and you can see the rates on the left axis and the occupancy on the bottom axis and the circle indicates the rev bar. There are of course a lot of differences in the markets. We won't have the time to analyze them all but you can see Stockholm, Västervik and Varberg as being real strong markets within Sweden. And if we move to the next slide where we follow up on the development for the local market during Q1, we see a very strong development for Västervik. We see a strong development for Uppsala where we had Sweden live music conference in January and on the other hand, we see a negative development for Jönköping that last year had the Elmia fair and the two large, the Elmia fair had two large exhibitions during Q1 last year that is not being in Q1 this year. So in the same way, look into the Norwegian market and the local markets within Norway and we can see the bubbles in this graph showing a really strong development for Tromsø and of course also Oslo, Tromsø and Bodø both by interfering from the Nordlys Turisme and the Midnight Sun Turismo. And if we in the same way look at the development for the different markets for Q1, we can see a very strong development for Trondheim that had the Ski World Championship in the end of February and beginning of March. And in the bottom, we can see Bodø that last year had the cultural capital opening weekend and also the Nordlands conference that is not being held this year. In the same way, looking into Denmark at the local markets, we perhaps as expected can see Copenhagen as a strong market but we also can see Torsheim with even higher rates. And looking at the development in the top here, we have Aalborg and in the bottom, we have Kolding. So last countries I've looked at, we have Finland. We can see a very strong market in Rovaniemi and weaker market in Espoo. And when we look at the development for the local markets, we see Espoo even though it's weak market is in strong development for Q, during Q1. So last but not least, looking at the future bookings for the major capitals. If we start by looking for on the books for Stockholm, we see a slightly increase here within the Stockholm market .8% and then you have to take in account last year was a very strong year from Stockholm market. We had many concerts including Taylor Swift. So yeah, slight increase here. We also see a negative effect of Easter effect affecting on the books here. Moving on to Oslo, we see a very strong development of the Oslo market, pretty much higher on the whole period, even though there is a negative Easter effect. There are festivals going on in Oslo. There are different rock festivals. This is the ISE conference and so on. And looking at Copenhagen, we see a small decline in Copenhagen on the book market. And we can see positive effects for Robbie Williams in June and a couple of smaller conferences in July and the Copenhagen half marathon, but generally down a bit. That's all for me. Thank you very much. Just reach out if I can be of any help. And let me hand over to the Pandocs team and Anders.

Thank you, Alex and Rasmus for your hotel market updates. And thank you all for participating in this call. We really appreciate your time and interest in Pandocs. And our interim report for the second quarter this year will be published on the 11th of July. So thank you for your interest and goodbye.