Lemon Tree Hotels (LEMONTREE) Q4 23/24 earnings summary

Executive summary

• Q4 FY24 delivered record performance in ARR, revenue, EBITDA, EBT, and PAT, with Q4 revenue up 30% year-on-year and 14% sequentially; full-year revenue reached INR 1,076.8 crore, up 23% over FY23.

• Gross ARR for Q4 FY24 was INR 6,605, up 13.4% year-on-year and 4.3% quarter-on-quarter; occupancy at 72% (down 163 bps YoY, up 605 bps QoQ); RevPAR at INR 4,754, up 10.9% YoY.

• Net EBITDA margin for Q4 FY24 was 52.9% (down 278 bps YoY, up 415 bps QoQ); full-year margin at 49.1%.

• PAT for Q4 FY24 was INR 84.0 crore (up 42% YoY, 92% QoQ); full-year PAT at INR 181.7 crore (up 29% YoY).

• Operational inventory surpassed 10,000 rooms, with a pipeline of 4,000+ additional rooms and expectations to exceed 11,000 rooms by FY25 end.

Financial highlights

• Q4 FY24 revenue from operations: INR 327.3 crore (up 30% YoY, 13% QoQ); full-year revenue: INR 1,076.8 crore (up 23% YoY).

• Q4 FY24 EBITDA: INR 175.3 crore (up 24% YoY, 24% QoQ); full-year EBITDA: INR 528.9 crore (up 16% YoY).

• Q4 FY24 PAT: INR 84.0 crore (up 42% YoY, 92% QoQ); full-year PAT: INR 181.7 crore (up 29% YoY).

• Cash profit for FY24 increased 24% to INR 293.8 crore.

• Cost of debt reduced to 8.86% (down 22 bps YoY); total debt at FY24 end: INR 1,889.1 crore (up 8% YoY, mainly for Aurika, Mumbai SkyCity).

Outlook and guidance

• Management expects at least 15% annual revenue growth for the next three years, driven by ARR, occupancy, and management contracts.

• Operational inventory expected to exceed 11,000 rooms and 120+ hotels by end of FY25; five-year plan targets 20,000+ rooms, stable 50% EBITDA margin, and a debt-free balance sheet by FY28/29.

• Rate growth in FY25 is expected to be robust, with price hikes in the 5%-12% range depending on market and segment.

• Keys portfolio renovation to drive EBITDA to INR 60 crore annually by October next year, with early signs visible from this October.

• Renovation spend of INR 100 crore planned for both FY25 and FY26, with full impact expected by October 2025.