Reato

A summary of the period

During the third quarter, First Hotels Franchise continued to develop value-creating services and products with a focus on hotel operators and customer experience. By improving its offerings and strengthening partnerships, Franchise has increased its visibility and availability in the market, which has contributed to a positive sales development and improved competitiveness.

First Operation has focused on improving its sales strategies, especially in appointment booking (MICE), to strengthen the company's position in this growing market. Efficiency improvements have also been implemented, especially due to the new F&B concept introduced earlier this year, to optimize operations and ensure both efficiency and returns.

In Property, the business has had a stable development with good rental income, which creates a solid revenue stream. The company continues to focus on managing and optimizing its existing property portfolio.

Significant events during the period

• First Hotels AB is signing a refinancing agreement through its subsidiary First Hotels International AS. The agreement entails repayment of debt to Host Hoteleiendom AS and issuance of two new convertible loans totalling approximately SEK 12 million to Gate Group AB and Seljeli Invest AS.

Significant events after the period

• The Board of Directors of First Hotels AB has received an offer from a group of investors to sell all shares in the Company's subsidiary, First Hotels International AS, to the bidders. In connection with this, the Board of Directors has called for an Extraordinary General Meeting in November, after receiving a proposal from shareholders that the Meeting shall approve the proposed offer.

Third quarter 2024 summary for the Group

*Comparative figures from real estate companies and hotel operations are reported from the acquisition date of July 27, 2023.

The interim report has been prepared in Swedish kronor, SEK. Unless otherwise specified, all amounts are reported in thousands of SEK (TSEK).

Comments by Thomas Gillespie, CEO

I am pleased to be able to present a strong result for First Hotels AB for the third quarter of 2024. We have seen a stable and positive development in all our business areas, which has contributed to a continued strong performance in the Nordic hotel market.

During the quarter, we achieved an increase in net sales of 35%, which can mainly be attributed to the positive development in our First Operations and First Hotels Franchise. Sales in First Operations increased significantly, driven by improved occupancy rates and a strong average room rate. These results confirm that our strategy to improve operations and create a more competitive market position continues to pay off.

First Hotels Franchise has also continued to show good growth, with net sales increasing by 17% compared to the same period last year. Our loyalty platform, First Member, plays a central role in this success, with 80% of our website's revenue coming from members, an increase of 15% from the previous year.

Our First Property business area has also had a very positive development. The loan-to-value ratio has decreased by 31% compared to the same period last year, which strengthens our financial position and makes us better equipped for future investments. Rental income increased significantly, which gives us a stable revenue stream and strengthens our position as a diversified company.

It is also gratifying to note the positive cash flow development. Cash flow from operating activities for the period amounted to SEK 5.2 million, a significant improvement compared to the previous year. This result reflects our ability to streamline operations and generate strong cash flows, allowing us to continue to invest in our future growth.

Our balance sheet has strengthened, and we now see an improved financial structure that makes us well equipped to continue our strategic investments. Although we still face some challenges, such as a high debt burden, we have a solid foundation to build on, and we have taken steps to improve our financial flexibility.

Going forward, we are confident about the development of the Nordic hotel market. We are focusing on optimizing our existing hotel portfolios and continue to develop our presence in markets with high growth potential.

I would like to thank our shareholders for their continued trust and support. We are confident that with our strong position in the market and our focused strategy, we will continue to deliver good results and create long-term growth.

– Thomas Gillespie, CEO

Auditor review

This report has not been reviewed by the company's auditor.

The company’s financial reports are available on the website https://www.firsthotelsab.com/en-us/investor/financial-reports/