Hi, good morning, everyone. Welcome to 4Q 2024 and 2025 business direction of The Erawan Group Public Company Limited. Today we have management joining, Youssef El Khomri, President, and Apinya Ngamapichon, CFO. Let's start.
Thank you. First of all, thank you for coming. We're changing the venue today, so we're happy to have you here at the Mercure Bangkok Sukhumvit . Today we're going to be presenting the 4Q results as well as the full year results. I would like also to apologize as the disclosure of financial statement just came in this morning, so I'm not sure if you had time to review it. We had some technical issues. Just apologize for that. But if you have any question related to financial statement, we're happy to answer it. In term of agenda today, I will briefly share with you some views on the market trend. I will also cover hotel performance and overall company performance in term of consolidated results. Then we will cover the outlook for Q1 as well as for the rest of the year.
The hotel market trend for Q4 has been very healthy in term of tourist arrival, and hotel performance, and this is across the three countries that we operate, Thailand, Philippines, and Japan. Thailand have seen a very strong year-on-year growth of 18%. This is largely driven by the Chinese market. Actually the Chinese market represented over 40% of the growth in Q4. The country also recorded high growth from other markets such as Europe, Middle East, and Southeast Asia. The Philippines have seen a total arrival of 1.5 million, growing 7% year-on-year. Despite the international arrival in the Philippines not seeing the same momentum as Thailand and Japan. Philippine continue to see a strong demand from domestic market, which is our primary target market for our properties in there.
Japan had a record quarter with really good numbers, over 10 million arrivals in Q4. Japan continued to deliver in term of tourist arrivals. The demand mostly was driven by East Asian markets, China, South Korea, Taiwan. These were the primary market that contributed to the strong growth of the tourist arrival to Japan. Domestic tourism also continued to grow steadily, which is a big market for us in Japan. For our company performance, more specifically, we have achieved record high numbers across all the metrics as you can see on the slide here in the fourth quarter. Total revenue grew by 18%, EBITDA grew 35%, net profit 65% year-on-year. These are great numbers that we were able to deliver, and this is mostly reflecting the success of our ADR strategy and of course, cost management that we've been very diligent about.
For the outlook, January has seen positive results despite a slower than expected Chinese New Year. Chinese New Year was not up to what we were looking at in term of demand from Chinese market. That was mostly due to the incident that happened early January related to China. We saw a slowdown of demand from Chinese market. However, other markets were performing quite well, so we were able to compensate that and still deliver growth in January compared to last year. For February and March, we expect to see a good trend, specifically from corporate. Corporate MICE and events will show better performance in February and March. Overall Q1 should translate into growth compared to last year. All in all, we expect a good 2025 for the industry in overall.
We would like also to highlight that the growth that we will be seeing in the coming months and for the year will be more normalized, more of organic growth. I mean, the last two years we saw double digit growth in term of rates and overall top lines. We will see a more normalized growth because we are coming out of a high base already. January we still show quite a significant growth, but moving forward, we will see that normalizing throughout the year. Later on, we will show our targets for the year in term of growth. In term of our operating performance, if we look at the fourth quarter, occupancy wise, we achieved 81% on a group level. Rate was above THB 2,000 and RevPAR was at THB 1,666. These are some of the highest numbers we achieved for our company.
If we look throughout the year, we are hovering in the 80%, I would say, for our company. We are not seeing much growth in term of volume year-on-year. Actually, fourth quarter, we were declining in term of occupancy. You can see 83% to 81%. But the success we have is really on growing the rates. Our ADR Qo Q grew 13% and year-on-year 11%. That is quite significant, that we were able to achieve so far. Of course, RevPAR also respectively 19% and 9%. When we look at the performance across the segments, economy and midscale are the one that are producing most of the growth. Luxury is growing, but economy and midscale are very strong.
When we look at tourism growth, a lot of demand is coming into that level of segment and price point of economy and midscale. I will pass it to Apinya for the hotel performance.
For hotel performance, we would like to start off with luxury to economy segment first. Right now, for economy to luxury segment, we have 18 hotels in portfolio as of 2024. The key driver of this market, as 17 hotels are in Thailand, and another one hotel is in Philippines. The key driver for this segment is Thailand international arrival. In quarter four, Thailand welcomed 9.5 million tourists arrival, and it is representing 18% growth year-on-year. It is recovery rate of 84% compared to pre-COVID level. In terms of nationality, China, Malaysia, India, Russia, and South Korea are top five market coming into Thailand. We see a slight alteration in terms of the top five. We see Russia becoming rank number four and added to the top five list, replacing Japan, which was in rank number five in the previous quarter.
Next is our performance of Erawan source market. In quarter four, we see top five are U.S.A., China, Thailand, Singapore, India. All of this market, the revenue has surpassed pre-COVID level already. In terms of the ranking, the spread of the top five is more diversified in quarter four because we see increase in the mix of United States, which supported by the seasonalities. The U.S. are top one in luxury segment, while China are top one in mid-scale and also top five in economy and luxury segment. For Thailand, they are top one in economy segment. All of the market has been performed very well. Coming into the performance of our luxury to economy segment, the performance is very strong. The occupancy rate in quarter four is at 85%, and we have completed our rate growth strategy throughout the year, especially in quarter four.
The room rate for this segment grew 12% year-on-year, and it is leading to RevPAR growth of 15%. This is mainly driven by performance of mid-scale and economy segment, as Youssef mentioned earlier. If you look at the performance by segment, as we can see from the graph in the middle column. The ARR growth of all other segment can deliver double- digit growth. Starting for luxury, the room rate grew by 11% year-on-year, while the occupancy rate in quarter four was 79%. We see the increasing trend compared to quarter three of the year. This is mainly driven by improving performance of Grand Hyatt Erawan after the incident. So it is resulted in RevPAR growth of 9% year-on-year for luxury segment. Moving on to mid-scale segment, the room rate growth was 14% year-on-year.
While we can achieve occupancy rate of 83%, representing 4% growth year-on-year in term of occupancy, and we can achieve double- digit growth in RevPAR of 20% year-on-year. This is driven by the performance of Holiday Inn Pattaya. We have opened after renovation in quarter four, and right now we have the room in the inventory of 531 rooms. So we will have the details in the next page for Holiday Inn Pattaya specifically. Lastly, for economy segment, the performance is very solid. In term of rate growth, the hotel can deliver rate growth of 16% year-on-year, while occupancy rate is relatively high, achieving 88% occupancy rate. So it is resulted in RevPAR growth of 18% year-on-year. In terms of Holiday Inn Pattaya performance, as mentioned earlier, we reopened Bay Tower, the tower that is next to the beach.
In quarter four, the performance is very strong in terms of the rate. We achieve rate growth of 22% compared to the prior year. This is supported by the new guest room that you can see from the picture, that it is modern and it welcomes family group to the hotel. We also upgrade the lobby area and other facilities, including gym and the spa. The performance of Holiday Inn Pattaya continues to be strong in quarter one as well. The room rate continues to be over THB 4,000 . With the strong operating performance, it also translated into strong financial performance of luxury to economy segment. Revenue grew by 10% year- on- year in quarter four, while EBITDA grew by 25% year- on- year, supported by revenue flow through and our effective cost management.
As a result, our EBITDA margin improved to 36% compared to 32% in the previous year. Our full year performance also delivers solid result. Revenue grew by 6% year- on- year, while EBITDA grew 12% year-o n- year, and EBITDA margin also improved to 31% compared to 30% in the previous year. Next, we are moving on into budget segment. I would like to recap in terms of HOP INN customer profile. For the group on the left, it shows the pie chart for customer segment. As you can see, that major customer profile of HOP INN are domestic customer, representing 90% of total portfolio. With the strong demand of domestic in each country, especially in Thailand and Philippines, it is become a diversified portfolio with a luxury to economy segment, which we rely on international demand.
In terms of purpose of the traveling, 59% travel into the purpose of coming into the hotel is for business. It is not reliant to seasonal as per the leisure group. On the right pie chart, we show the mix of geographic of customers that coming into our hotels. The highest nationalities coming into HOP INN are Thai people, especially in Thailand. Filipinos are ranked number two, representing 22% mix in geography, and the rest are Japan and other countries. If we dive deeper into customer profile of each country and growth driver in each market, starting from Thailand first. As mentioned earlier, for HOP INN Thailand, around 90% are Thai, and the key driver for this growth are number of domestic travelers within the country and also GDP growth which support the business demand.
In quarter four, in 2024, there are 270 million number of domestic travelers, and it is contributing to 8% growth year- on- year. Specifically for Q4, number of domestic travelers grew by 5%. For GDP growth, it grew 3.2% in quarter four. We still see that the demand in Thailand market continues to be growing. For Philippines, in terms of customer profile, is similar to Thai customer profile, that majorly the customer is Filipinos with its domestic market representing around 80% of the portfolio. The driver for this market are this GDP growth and domestic travelers demand. However, for number of domestic travelers, it is not reported on quarterly basis, so we use GDP as an indicator for this market. GDP growth of this market continued to be growing at 5.2% year- on- year in quarter four. Lastly is HOP INN Japan.
The profile of the customer is different from Thailand and Philippines in the way that most of the customer are foreigner, contributing to 80% of the portfolio. The major nationalities are Thai, Philippines, China, and Taiwan. This is following our strategy to cross-marketing to existing market that we already have. The growth driver of this market is international demand. As mentioned earlier, tourism market in Japan is very strong. In 2024, Japan welcomed 36 million of the tourists, and it is representing 47% growth year- on- year. For this quarter four, we has opened two additional HOP INN properties in Thailand. The first one is HOP INN Prachuap Khiri Khan, which was opened in October, and another one is HOP INN Phayao, located near tourist attraction, Kwan Phayao, in December 2024. The performance of these two hotels remains strong since the opening.
Coming to the operating performance of budget segment, starting with Thailand first. In terms of number of rooms, in quarter four we expand 12% in terms of number of room. For the total revenue growth for Thailand of 61 hotels in the portfolio, the revenue in quarter four grew by 19% year- on- year. If we exclude the performance of new hotel that we opened this year, to see organic growth of existing hotel of 51 hotel, which is showing in the most right column, we continue to see the organic growth of 8% year- on- year. The performance is strong in terms of both existing hotel and new hotel that we opened. Moving next to Philippines. Philippines, this year we opened three additional hotels into the portfolio, which contributing to 86% growth of number of room.
With these 10 hotels, the total revenue grew by 21% year- on- year. While if we look at the organic growth of the seven hotels that are excluding the impact of new hotels, revenue dropped by 7% year- on- year, and this is partially impacted by initiative from the government to ban international online gambling. It is impacted the business in especially corporate business from China and Vietnam. Going forward for Philippines, we will focus on domestic demand and also have strict control on our expenses. We will drive the traffic to web direct, which is our own channel to have better margin. Lastly is Japan. We opened three additional hotels this year representing 141% growth in terms of number of room. The four hotel, the ramp-up performance is very strong.
In quarter four, we achieved a revenue of JPY 97 million and achieved profitability at EBITDA level for this year. With the strong performance of HOP INN, the revenue grew by 56% year- on- year in quarter four. EBITDA margin also grew by 76% year- on- year. We also see improvement in terms of EBITDA margin. The margin was 43% compared to 36% in the previous year. For full year performance, the performance continued to be strong. Revenue grew by 41% year- on- year, and EBITDA grew by 44% year- on- year. We also see improvement in term of EBITDA margin, both in quarter and full year basis. Moving on to The Erawan Group performance. With the strong performance of both luxury to economy and budget segment, our total revenue in quarter four achieved THB 2.2 billion, representing 18% growth year- on- year.
Normalized EBITDA closed at THB 841 million, improving 35% year-on-year. We achieved net profit of THB 370 million, representing growth of 65% year-on-year. As mentioned earlier, this is a new record high for quarter four performance of The Erawan Group. Full year performance, we closed core net profit at THB 906 million . It represents net profit growth of 23%. All of the metrics, revenue, EBITDA, and net profit achieve new record high as well for this full year. In terms of our financial position, our financial position remains solid. As you can see, our leverage ratio kept lowering during this year. This is supported by our strong equity base from the first one is strong profitability and the proceeds of THB 1 billion that we received from the warrant.
The proceeds that we received from the P/E and as well as support from land revaluation in quarter four. It increased our equity base by THB 580 million . As a result, our interest bearing debt to equity ratio is now 1.1 x, dropped from 1.7 x at the end of 2023. Right now, the average cost of debt is 4.2%. In terms of liquidity to support the growth in the future, we still have both cash and utilized credit facility to support growth in the future. Next, I would like to pass to Youssef to talk about the outlook of The Erawan Group for this year.
Thank you. For this year, in terms of revenue growth, we are forecasting a 10% growth for the company, for the group. The economy and luxury, we see 5%-7% growth, more of organic growth. For the budget segment will be 23%, which will also be driven by additional properties that are opening this year. Our key focus will continue to be on pricing, but also on occupancy, making sure that we are maximizing occupancy even in softer periods. Food and beverage will also continue to be a focus for our five-star hotels, both in outlets and events. That will be supported with effective marketing strategies. We are also putting a lot of efforts in terms of productivity, efficiency, and making sure that we are operating at optimum costs and to enhance our bottom line.
In terms of industry forces, there are some positives where we expect India and Southeast Asia to continue performing and growing. Also, we see that the Thai government with the visa easing and in some of the policies will continue to stimulate the international markets to Thailand. Some of the headwinds, in terms of macro and geopoliticals. There are a lot of things happening and we are watching carefully. So far, we are not seeing any impact from all what is happening around the world. But it is something that eventually could see some impact and we are watching carefully. In terms of CapEx. For this year, we are estimating a CapEx of THB 3 billion . Budget hotels will represent around THB 2 billion, which will be a combination of new hotel development that are committed this year, I would say half of that.
Another THB 1 billion will be reserved for new development. For economy to luxury, we have around THB 1 billion as well. It is a mix of renovation, maintenance, and new hotel development, which I will mention in the next slide. In term of renovation, this year we have two projects. The Grand Hyatt, which we will be renovating, and we have already shared with you some of the details in the previous meetings. We are also renovating The Naka Island, a Luxury Collection Resort & Spa, Phuket. The renovation will happen in Q2 and Q3 during the low season. We expect minimal displacement on the renovation. For The Naka, the scope will be some of the uplift in term of villas. Most of the work will happen on the facility.
We are fully renovating the F&B outlets, all the wellness component of the resort, the spa, and some other facilities. For our hotel opening as well as new developments. Starting with the left side. For HOP INN, we have 10 hotels opening this year. We already opened two of them, which is Pattaya and Songkhla, and then we have another eight to open for this year. A total of 791 keys. For new developments, we are actually quite happy to share with you that we secured a long-term lease on Sukhumvit in Phra Khanong area. This is a land where we are going to be developing a property in the mid-scale segment. We are also looking at in term of development concept as a combo hotel. We will be bringing two brands and targeting that mid-level positioning for the hotel.
In term of rates, we are looking at THB 3,000-THB 4,000 for each of the brand. Probably the property will be sitting around THB 3,500 in term of ADR. The number of keys will be around 400 keys- 450 keys that we are planning. We expect to open early 2029. This is a new project additional for our non-budget segment. We are happy to share this new development for our company. For this year, we already, as I mentioned earlier, we opened two properties for HOP INN. This is Pattaya. It is on the second road. Very good location. Easy access to Sukhumvit Road and then to the highway. We see very good feedback so far from this property and occupancies are ramping up very fast. We also opened HOP INN in Songkhla, also doing quite well. Just opened actually, last week.
We are quite happy with these two addition to the HOP INN portfolio. That was all for the presentation, and then we are happy to take questions from you. Thank you.