Good morning, ladies and gentlemen. Welcome to the PPHE Hotel Group investor presentation. Questions are encouraged. They can be submitted at any time via the Q&A tab that's just situated on the right-hand corner of your screen. Please just simply type in your questions and press Send. The company announced a strategic review in November 2025, which remains ongoing. As a result, management may not be in a position to answer all of your questions today. Before we begin, as usual, we would just like to submit the following poll, and if you could give that your kind attention, I'm sure the company would be most grateful. I would now like to hand you over to the team from PPHE Hotel Group. Greg, good morning, sir.
Good morning. Thank you, Jake. Good morning, and welcome to our 2025 full year annual results. I'm Greg Hegarty, co-CEO of the PPHE Hotel Group. I'm joined today by Daniel Kos, our CFO, and Robert Henke, our EVP of Commercial. 2025 was another solid financial strategic year of progress. We delivered a great result despite a volatile macro environment. Before we go a little deeper, I think it would be good just to show you a few highlights of the year.
Good morning, everyone. I just wanted to spend a few minutes introducing PPHE Hotel Group. If you're not familiar with our, with our company, we are a real estate company active in the hospitality industry, and what makes us unique in the hospitality industry is that we have our own integrated operating platform. What we do as a business is we own properties, we develop assets, we also operate the products when they are delivered. We were first created in 1989, and have been listed on the London Stock Exchange since 2007. We are currently included in the FTSE 250 and the FTSE EPRA Nareit Index. As a portfolio, we cover 18 different markets, of which London, Amsterdam, and a Croatian destination called Pula are our primary markets.
We have exposure through asset ownership in seven capital cities today. That is London, Amsterdam, Berlin, but also Rome, more recently, Zagreb and Belgrade and Budapest. Within London, which is our primary market, we are one of the largest owner-operators of upper upscale assets, and we have just over 3,700 rooms within central London, as well as some of the largest meeting and event spaces in the city. What sets us apart, as I said before, is that we own the operating platform, and as we go through the presentation today, we'll talk more about what the platform does, how it's structured and why that is beneficial. I'm moving on to some of the more detailed slides. As I mentioned, we have property exposure across different geographies. We're active in eight countries.
That's the U.K., Netherlands, Croatia, as I mentioned, as well as markets like Germany, Austria, more recently, Italy. We have about 50 properties in operation today, as well as a solid pipeline of new projects with four projects in London, all with planning permission. That's our longer-term pipeline. We have just under sort of 15,000 units in our business, which consists of 10,000 rooms, as well as about 5,500 pitches and mobile homes in a Croatian leisure destination. Every year, we have all of our assets valued externally, and the valuations on the back end of 2025 came in at GBP 2.2 billion.
The employee count in our business is about 4,500 employees, with head offices in the U.K., in London, as well as in Amsterdam, Berlin and in Pula, in Croatia. The exposure that investors have is to owning assets, but also the operating side of our business and then development. We're fully integrated and a one-stop shop as a result. This model shown here on this chart basically demonstrates how we create investor value. What we like as a company is to buy assets with development potential or land sites. We develop hospitality products, we then operate these hotels, and we extract some of the value from these assets to reinvest into the next investment opportunity.
This is a journey that we've been on for well over 35 years with strong shareholders returns to demonstrate the success of this business model. Greg, over to you quickly on the CapEx.
Thank you, Robert. Over the last decade, we have invested more than GBP 1 billion into maintaining and expanding our portfolio. Most recently, we completed our largest ever multi-year investment program, exceeding over GBP 300 million, focused on new openings and repositioning existing assets. Those properties are now contributing to EBITDA, and we expect that contribution to accelerate as we continue to stabilize those assets in the future. This reflects our long-term approach on this slide to CapEx. We invest through the cycle, we upgrade quality, and ultimately, we unlock future earnings. Thanks, Robert. Next slide. Thank you. Looking at some of our high-quality assets in prime locations, Robert's already alluded to, but we do operate 50 hotels in eight countries, with our prime markets being U.K., Netherlands, Croatia, and Germany.
This shows you the spread of our company, and where our percentages lie in terms of those specific geographies. We are in over 18 geographic markets, including seven total, seven capital cities, and the majority of our asset value sits within those capital cities. London and Amsterdam remain key pillars within our company, complemented by strong seaside resorts in Pula, in Croatia. Our owned portfolio is externally valued at GBP 2.2 billion, with GBP 1.6 billion in freehold, giving us both asset quality and balance sheet strength. These are high barrier to enter locations with durable demand fundamentals attracting these into these markets. Explaining the hospitality management platform. Our in-house management platform is a real strategic advantage for PPHE.
It gives us full operational control, it aligns owner and operator interests, it provides flexibility around exits and branding of assets, combined with access to Radisson's global distribution system, loyalty and procurement systems. It allows us to have scale and efficiently retain control of our co-complete portfolio. It is a capital light asset, however, it has capability to drive a capital-heavy business. This positions us really well for future growth. Looking at some of our secured pipeline, as you can see here, there is five assets as an example. On the left there, we have our land site on the A40 in Park Royal. In the center, we have Westminster Bridge Road. On the far right, we've got our newly acquired Leman Street development.
On the bottom left, we have an existing asset of Victoria Park Plaza, how we're going to create a subterranean concept. On the right, we have New York. Going in a little bit more detail and zooming into that, at Park Royal, we now have control of both an operating hotel directly next door to it and a development site. This has planning permission for 616 units, which will give us multiple operations for value creation options. We also have 6,000 sq ft of industrial planning there for us to coincide with that development opportunity as well. At Westminster Bridge Road, we are advancing with designs on our 186 key bedroom property there. This is likely a select service hotel, again, targeted to be a Radisson RED property.
At Leman Street, we acquired the site in our first central location here on this side of London. Again, this is earmarked for a Radisson RED property, moving the portfolio into a more select service model. So we are then becoming very differentiated from full service to luxury, to actually select service as well. At Victoria, we're unlocking a underutilized basement area there and creating 79 keys, again, in a select service model. Above that, we then have a meeting and event facility in this hotel, coupled with the Park Plaza Victoria Hotel above it from ground to roof. Post-year-end, we agreed the sale of New York, which is on the bottom right there. I'm pleased to say that is progressing.
We disposed of our asset at a value of $33.5 million. We'll be recycling that cash back into our European core markets as we go forward. Just showing you that this is a disciplined capital business, which actually does capital rotation into action within our pipeline. Thank you. Looking ahead at our strategic and operational update of 2025, financially, revenue grew by 5.3% to GBP 466 million, with an EBITDA of GBP 138.8 million. RevPAR increased by GBP 2.6 million, driven by both occupancy and in rate growth. EPRA earnings held at GBP 1.25, supporting a full-year dividend of GBP 0.39 per share. We absorbed continued government-driven cost inflation, particularly wages, social charges through technology.
We've been able to minimize these impacts, and obviously, we've been focusing on efficiency initiatives and improving our productivity within our operational portfolio. Strategically, we complemented the opening of our assets with the art'otel Rome in 2025. We finalized a full year offering at the art'otel Hoxton. We upgraded two of our Croatian campsites. We expanded our pipeline in London, and we increased our Arena stake in Arena with GBP 15.5 million, and we completed numerous U.K. refinancing projects. Looking ahead, we're rolling out our new property management system. We're focusing on more digital automation within the Park Plaza brand, especially within guest service areas such as reception, and we're improving our guest experience there, and also driving efficiency. Cost control always remains a key focus, as I've already alluded to there.
Alongside that cost control, we are also stabilizing our recently ramped-up assets, or assets of Hoxton and Rome, which will then start creating more value in our longer-term pipeline. Thank you.
Thanks, Greg. As Greg said, we are quite pleased actually with the group's performance for 2025, given we had a slow start and also particularly giving the external headwinds that we faced, including geopolitical uncertainty and the cost inflation that our industry is facing. Our reported revenues during this period went up with 5.3% to GBP 466 million, and on a like-for-like basis, where we exclude the art'otel Rome that we opened in 2025, and three months of art'otel Hoxton, the revenue was up 3.7% to GBP 457 million.
The year unfolded really as a story of gradually strengthening performance, with the average room rate for the year increasing with 1.7% now to GBP 164, and a 0.7% increase on a like-for-like basis. We also managed to increase our occupancy with 60 basis points on a reported basis to 75.1%, and on a like-for-like, occupancy came in even higher at 130 basis points growth to 75.8%. This blended rate and occupancy increase has resulted in a 2.6% growth in RevPAR, reported at GBP 123. On a like-for-like basis, RevPAR came in 2.4% higher.
We reported an EBITDA decline in the first half of the year, I'm very pleased to say that we've turned this around in the second half, which is typically our strongest six months of the year. We've reported an overall EBITDA growth of 1.3% to GBP 138.2 million from GBP 136.5 million last year. On a like-for-like basis, EBITDA grew to GBP 139 million. Our adjusted EPRA earnings came in at GBP 53 million, which is GBP 1.25 per share, which is in line with last year. On the back of these EPRA earnings, we typically spend around 30% on dividends.
We propose to increase the final dividend to GBP 0.22 per share versus GBP 0.21 last year, which will bring the total dividend this year to GBP 0.39 per share. Going on to the revenue slide. As said, we reported the revenue growth of 5.3%, but the trends between the territories was quite mixed. As you can see here, the Croatian region showed a strong rate growth of 7.1%, whereas the German region reported the opposite, with a 5% rate decline, which is mainly due to a strong comparable. In 2024, we had the European Football Cup in Germany, and we had fewer trade fairs in the cities in 2025, where we are present.
Occupancy growth has been the strongest in the U.K., with the growth of 230 basis points, whereas the Dutch region lost most in occupancy term, with a decline of 220 basis points. The trend was also quite mixed between the quarters, if you see the lower graph, whereby we had a weak start into 2025, with Q1 rate and occupancy decline, but it largely moved strongly into Q2 and a very strong performance into Q4, albeit more rate led. Going to the EBITDA slide. Like I said, despite a weak start of the year and the government-imposed cost inflation, we managed to grow EBITDA to GBP 138.2 million.
The cost inflation, which included minimum wage increases above the run rate inflation, added with National Insurance contributions in the U.K., caused our margins to slightly decline versus last year. However, through proactive cost control, we have managed to limit the impact of these cost increases and see potential to continue this in the near future. Between the territories, we had strong EBITDA growth in the U.K., with margins improving on the back of the ramp up of Hoxton. The Netherlands and Germany both showed EBITDA declines on the back of their respective revenue declines. However, Croatia showed a good EBITDA and margin growth in the year, with an increase of GBP 3.5 million and 230 basis points, respectively. Management and central this year was, like, impacted by some one-off expenditure.
Caused by staff restructuring costs, which will help us going forward, and the implementation cost of some major technology projects in the year. We remain very focused on cost controlling, further accelerating technology implementation and process automations to drive further efficiencies. On EPRA earnings, as said, we reported GBP 53 million, which is in line with last year. On a per share basis, it gets to GBP 1.25 per share. As you can see in the first waterfall chart, the EPRA earnings were negatively impacted by an increased finance expenses. These finance expenses largely increased due to the opening of Hoxton last year, which is now fully contributing, and the art'otel Rome of this year, which now also impacts the PNL. We refinanced the Dutch portfolio late in 2024.
The impact of the openings on our EPRA earnings obviously should positively improve in the coming years with the ramp-up of these openings. In terms of valuations, our EPRA NRV per share declined slightly to GBP 27.40 versus the GBP 27.50 last year. External valuations in the U.K. portfolio came in lower this year, mainly due to the increased business rates that were announced late last year by the U.K. government. Valuations stayed relatively flat in the other territories. Favorable foreign currency exchange results on the euro-denominated portfolio did offset quite a large part of the impact that the U.K. property valuations had on our NRV. Net debt increased slightly from GBP 750 last year to GBP 775 this year, mainly due to the acquisitions we had last year.
Like, we bought the freehold in Park Plaza, Park Royal, we bought a development site in the City of London, and we had some extra. We bought an extra stake in our listed subsidiary, Arena Hospitality Group. In terms of cash flow, we reported the last 12 months a strong free cash flow before expansion CapEx and loan amortization of GBP 80 million. Free cash flow was positively impacted by our GBP 138 million EBITDA and around GBP 70 million of working capital moves, and we had GBP 18 million of maintenance CapEx in the year and GBP 58 million of interest, ground rent, and unitholder payments. Free cash flow was mainly used to fund expansion CapEx and loan amortizations.
Expansion CapEx this year, as said, amongst others, include the freehold in Park Royal, the development site in London, and also the significant investment we did in two campsites in Croatia. The GBP 30 million bank loan repayments are in line with our contractual payments and in line with our debt strategy, which has regular amortization in it. We have now come to an end of our substantial CapEx cycle, and on the most recently opened hotels in Rome and in London. Zooming into our debt position, we have around GBP 910 million of gross debt outstanding, of which 75% is sterling denominated and 25% is euro denominated. Net debt is around GBP 775 million, which translates to a conservative loan-to-value of 35%, with the properties at market value.
The bar chart in the middle shows the maturity profile of the remaining facilities. In the last couple of months, you have noticed probably in the announcement, we have refinanced four facilities that were due in 2026, totaling to approximately GBP 222 million, extending the average maturity to 4.2 years at an average interest of 4.2%. The first large facility up for refinance now is only in 2028. We have significantly improved our liquidity profile. Greg?
Thank you. To summarize and for our outlook, 2025 delivered clear progress. Our largest ever investment program completed, art'otel Rome opened successfully, London pipeline has strengthened, the balance sheet materially has been reinforced. In 2026, we will continue to drive operational efficiencies through technological advancement and procurement. Forward booking across all regions is encouraging following a strong start to the year. Despite the ongoing macro volatility, the board expects to build on 2025 performance, with revenue and EBITDA growth driven by stabilizing new hotels and recent investments. We remain confident in delivering full year 2026 in line with market expectations. Thank you.
Thank you, Greg. That takes us to the Q&A part of today's session. As already mentioned at the start of the presentation, the company announced a strategic review in November 2025, which remains ongoing, and as a result, we may not be able to answer all of the questions that have been raised. From the questions that have been raised, I want to go through those that we're able to answer. Daniel, this one is for you. What percentage of the portfolio would you consider approximately as sort of non-core?
I mean, it's difficult to say in terms of percentage, whether that's from a valuation point of view or from a numerical rooms or just a single hotel point of view. Obviously, strategically, Park Plaza or PPH have always focused into city centers and basically the resort type of locations. I wouldn't necessarily call it non-core, but the assets in the provinces like Leeds and Nottingham, or in Holland, Eindhoven and the other provinces are probably considered non-core, if you like, in such a definition.
Thank you. I think that sort of summarizes the questions we've received so far that we are able to answer. We can't answer any questions that are forward-looking, or results focused for 2026 and beyond. If there are no further questions, then we'll have to end the session here today, with a ball at the end of the presentation.
Guys, if I, if I may just jump back in there. Thank you for your presentation today. Greg, just perhaps before really now just looking to redirect those on the call to provide you with their feedback, which I know is particularly important to yourself and the company, if I could please just ask you for a few closing comments just to wrap up with, that'd be great.
Yeah. Thank you, Jake. Well, ultimately, I'd like to thank Investor Meet for the opportunity to reach out to your audience. I think hopefully through the presentation, it's great to share our company, its strategic direction. I think hopefully you will all see that PPHE is a superb hospitality real estate company with a scalable platform. With that in mind, I think we've got that across. I wish you all a very good day, and thank you for your time.
Perfect, Greg. That's great, and thank you all once again for updating investors this morning. Could I please ask investors not to close this session, as you will now be automatically redirected to provide your feedback. On behalf of the management team of PPHE Hotel Group Limited, we would like to thank you for attending today's presentation. That now concludes today's session. Good afternoon to you all.
Thank you.
Thank you.