Covivio Hotels (COVH) H2 2025 earnings summary

Executive summary

• Achieved strong operating and financial performance in 2025, with recurring results per share up 6.4%, dividend up 7.1%, and NAV per share up 4% year-over-year.

• Maintained a diversified, high-quality portfolio focused on central European locations, hospitality, and German residential assets, with strategic capital rotation toward hotels and city center offices.

• Continued growth in ancillary revenues and operated real estate, leveraging asset management, modernization initiatives, and new partnerships.

• Hotel investment activity was dynamic, reaching €23 billion (+13% year-over-year), with hotels now 10% of the investment market.

• Delivered new hotels, major renovations, and signed a 12-year lease with Radisson Hotel Group, expected to boost revenues by over 50% for the asset.

Financial highlights

• Recurring earnings grew by 10% in EUR million and 6.4% per share, with like-for-like rental growth of 3.4% and total revenues up 3.7%.

• Dividend proposed at €3.75 per share, up 7.1%, representing a 7% yield, to be paid in two installments.

• EPRA NTA per share up 4% to €82.9; NDV up 5% due to deferred tax changes.

• EPRA LTV decreased to 42.9%, with net debt/EBITDA at 10.7x; S&P rating BBB+ with stable outlook.

• 2025 net income (Group share) rose to €308 million from €225 million in 2024, driven by revenue and asset value growth.

Outlook and guidance

• Targeting 4% growth in recurring result per share for 2026, supported by operating performance, asset management, and ancillary revenue growth.

• Guidance includes headwinds from indexation and capitalized interest, expected to normalize in 2027.

• Plans to accelerate development in Southern Europe, including a new €32 million Meininger hotel in Porto and exclusive rights to acquire €300 million in leased hotels in Italy and Spain.

• Continued focus on hotel acquisitions, office-to-hotel conversions, and city center office investments.

• 2026 growth expected to be driven by demand volumes and customer mix optimization rather than rate increases.