Thank you very much, operator, and good morning, everyone, and thank you for joining this short presentation. I'm here together with our CFO, Jan Johansen and our Head of Investor Relations, Henrik Wiekstrom. As you may recall, we said in our halt for the Q1 in late April that we would give an update on market conditions today on June 15. Since we thought visibility was so limited when we reported this report Q1. We will start this with a very short presentation, and then we will open up for questions that you might have afterwards.
So if you could please Turn to Page 2 for this brief summary. Since we launched the Q1 report. We have seen improved demand in all our markets, driven by the East restrictions. Our occupancy was around 20% in April, and it was 25% in May. For June, we expect occupancy to be at least 35%.
Our customers are still With relatively short lead time, but we conclude that our business on the books for July is clearly higher than it was at the same time last year. Hence, we expect our occupancy in July to exceed last year's level of 42%. If you please turn to Page 3. This shows The monthly market occupancy in the Nordic countries, we were down at very low levels of below 20% in December January, And there has been a gradual improvement since then in all our markets, especially during April May, as you also see. In May, market occupancy reached just below 30% in Sweden and Norway, While it was around 25% in Finland and Denmark.
And if you turn to the next Page 4, Here you see Scandic's 7 days rolling occupancy development until Friday last week. It was around 15% in the beginning of April, and it successfully increased since then, And it is now approaching 35%. It has so far been a broad market recovery where demand has improved in more or less all destinations, both during midweeks and in the weekends. The reason for this is quite obvious. We have seen a gradual easing of restrictions in all our markets.
And that, of course, together with the vaccine program, has driven the demand. There are still differences in restrictions between the countries, and there are also some regional variances. But societies has started to open up. Restaurants and amusement parks, etcetera, are now open, and we are seeing a gradual evening of opening hours and gathering restrictions, etcetera. In some markets, government have communicated plans for the gradual phasing out of restrictions with the target that they will more or less be gone after the summer this year.
In the right, you can see that Norway has been the strongest market so far with an occupancy rate of at present of around, I would say, 40%. I should also add that our 4 German hotels are still affected by weak demand. Occupancy has increased as well, but from very, very low levels. It was below 10% 1 month ago, and it is now around 20% and increasing. For this summer, we expect demand to come mainly from domestic leisure.
We expect more corporate activities, sports groups and cultural events, etcetera, from the early autumn and onwards. Initially, demand will be driven by the intra Nordic travel, which normally accounts for just more than 80% of Scandic's total guest nights. We will probably have to wait until next year until we see international demand coming back significantly. If you turn to the next Page 5, This shows Scandic's occupancy from the beginning of 2019 until last Friday. The occupancy levels right now are more than twice as high as they were at the same time last year, While it is still half of the pre pandemic levels that we saw in mid June 2019, Last year, there was a rapid improvement from the extreme low levels of only 6% to 8% in April May, up to 42% in July.
That improvement came almost entirely from domestic leisure demand, And it happened despite very low activity levels in the large cities throughout last summer. Our business on the books for July is today at a clearly higher level than it was at the same time last year. So currently, business on the books for July corresponds to 22% of our total capacity compared to 14% at the same time 1 year ago. One important reason for this is that we are seeing clearly higher booking activity for the large cities as, of course, these restrictions are eased. With open restaurants, Bars and amusement parks, etcetera, there are clearly more reasons to go to a big city compared to last year.
And these destinations account for quite a considerable part of our solar portfolio. So this is very important for us. But even if this summer will be better than last year in the capital cities, occupancy is still like It's very far from what we consider to be normal levels. On the next Page 6, You can see Skandex occupancy in the capital cities between early May mid last week. It has increased lately, especially in Oslo, where it currently is 30% to 35%.
It is around 25% in Stockholm and Copenhagen, but below 20% in Helsinki. So demand in the capital cities has remained lower than for other destinations in each market. In a normal year, occupancy should during the summer months be at least 75% in these cities. So there's still massive room for improvement here. With that, I hand it over to Janan for some financial update.
Yes. Thank you, And the road into that is through RevPAR here. And you can see here still Really low levels on RevPAR, but still a think 56% increase in May to 'nine If you compare it with the Q1 1, 4.7, we, of course, expect that Sequential development to continue. If you calculate backwards here and compare with the occupancy The numbers which we have given you, you will see also that we have an increase, an improvement in the average prices here, and that is due to more individual traveling, especially then coming into the weekends here. We expect that trend to continue and actually beat last year's prices here soon.
And that is primarily then our segment mix. However, July, Of course, that will be influenced by discounted package deals as usual during the summer then. And then we'll see what's happened during the autumn when the corporate traveling resumes. If we now turn to next page, A few comments here on what that will bring to the income statement and cash flow here. Even if we are now seeing much better numbers here, we still expect retroactive state date in the region of at least SEK 200,000,000 for Q2.
Obviously, if the market then continues to improve, this effect It will be less and less here. Also with this in mind, Including improved occupancy level and that we are still working very hard with reducing And then control investment and also improved cost efficiency, taking advantage of the improved demand here. We will see a much Better reduce cash outflow during Q2. And we repeat What we have said so many times before, we expect to have a positive cash flow and reach Breakeven in terms of cash flow, if not, you can see not above 50%. We will see and Try to see if we can actually get it a little bit below 50%.
And we hopefully, we will have a reality test on that now during Q3. So that is how much we will say about the numbers right now. So I will leave the word back to Jan Steers. Thank you, Jernen. So if you just turn to the last page, then to sum all of this up, we are really happy to see that the market is recovering in line with what we actually expected and also have communicated some months ago.
With at least 35% occupancy in June and with a better July than last year, which is promising. As the government's restrictions are successfully being eased up, we expect a gradual improvement of the Nordic Hotel market in general. And we are entering this recovery, to Janus' point, with a very low cost base. We will publish our half year report on July 16 at 7:30 and also have a call after that. And with that, I hand it over to you, operator.
Thank you.
Thank Our first question comes from the line of Adela Desjian from Hentgen. Please go ahead.
Yes. Good morning. Can you hear me?
Yes, we can.
Great. I just had a question on your corporate guests and if you could give us a little more color on that And how they're acting at the moment, especially when it comes to conferences, which is an important revenue stream for you in the fall. So have you seen any conference bookings already for this year? Or do you still expect it to take a while until The conference segment is back up and running.
Yes. We have seen smaller meetings lately, That is smaller meetings, and it is in line with the easing of the number of people gathering. But the main part of meeting industry has actually been pushed until early autumn. So a lot of the meetings we have on the books when it comes to meetings for 20 people and above. That is postponed until early autumn, which means late, late August and into September and ahead.
So but we do have meetings on the books for the autumn, which has been pushed from this spring. But it's not that we don't see meetings. We do see smaller meetings. We do see people of 4, 6, 8, and 10 people gathering here and there. And even some governmental meetings, which they have started to open up for.
So it's not entirely 0, but it's very low levels right now.
Great. Thank you very much.
You also maybe I can add, you also add a bit of the corporate segment as such. And as we mentioned here, We actually see also increased occupancy levels during weekdays. So it has been pretty stable, I would say, and that's driven by A lot of blue collar workers and Infrastructure Buildings and other parts of our corporate segment. So that is also picking up.
And the next question comes from the line of Karl Johan Bonhoeffer from DNB Markets. Please go ahead.
Yes, good morning. Just to continue on that note, when you have done your annual, say, contract negotiation with Corpus, the kind of, I'll say, discount structure they get and so on. Has there been huge changes to that? Or have they kept, let's say, The gross amount they are looking for, for the future even though they might not have been able to make use of it short term? Well,
it is a mix Actually, I think a lot a large part of our corporate clients, which we renegotiated even in the late part of last year in Q4, A lot of because of this, let's say, uncertainty in the market, a lot of our corporate clients just prolonged the current agreement. So they prolonged Without giving clear expectations for the levels, but on prices, they prolonged on current conditions, meaning that they were not pushing to get much lower rates. When that is said, of course, a large part of our Very big corporate accounts, they have decreased a lot when it comes to their demand. So we are seeing much lower levels from the very big corporate clients when it comes to white collar traveling. When When it comes to infrastructure building, then we have seen quite, I would say, an okay level and still a demand also for the autumn picking up.
But it's yet to be seen how much pressure on price we will see in the autumn when we need to renegotiate for next year. But as we are picking up right now, we expect that prices should be fairly okay given the conditions.
Excellent. Good to hear. Good to see that the market is recovering according to basically the time lines you Just in both in the Q4 and Q1 report, if you are looking at it, looking back at it. And now when you're getting into This recovery, do you expect some sort of tightness or risk to you when it comes to, say, rehiring staff that was forced to go during the worst part of this cycle, finding the right employees to get them back?
Yes. I would say for certain Parts of our business, we have seen that it has started to be a big of an issue. But also in other areas, we haven't seen it yet because we still have people on furlough that we have been calling back, you can say. But you are right, I would say, one area that we are looking very focused into is chefs and kitchen workers because a lot of these people that have been on furlough for quite long Have either left or had other opportunities in general. So we that's an area where we have a lot of focus to really secure that they that, let's say, how the chefs are coming back or that we can employ new ones.
So that's an area that we had an issue even before and which we think we need to continuously with also Onward.
And just one final for me. When I look at the occupancy development per But obviously, you highlighted Helsinki falling a little behind. Is that related to that you normally see a higher international share of demand there? Or is Anything else one should have at the back of your mind?
I think, Karl Johan here, I think what we have experienced in a way is that Health Yes, probably we've been busy with the strongest regulations here, and we believe that, that is the effect. So but of course, we will have an effect of that the Far East demand will be gone for a while here. So But we should expect to have the same development in Helsinki as we have seen in Copenhagen, Probably maybe with a little bit of a time delay, but eventually, it should come. I mean, I think we should also mention here that Berlin has started to take off force, so it was not on the slideshow here, but we can see a reasonably strong improvement now in Berlin. And The level starts now very soon with the 2, I can say.
So it's not so Far away from the Nordic capital cities there. So there are signs of improvement also there. But we should expect Helsinki to maybe Kind of a little bit later than some of the others. Thank you
very much for the extra color.
Yes, thank you. And we can also add that if you look at the different cities in Germany, normally Berlin and Hamburg is destinations that are pretty strong and leisure destinations during summer versus, for instance, Frankfurt that are much more business oriented. So We expect a faster pickup in Hamburg and Berlin versus, for instance, Frankfurt. Okay, operator?
Our next question comes from the line of Jamie Rollo from Morgan Stanley. Please go ahead.
Thanks. Good morning, everyone. You've helpfully given us the RevPAR figures for April May this year. Could you please give us the Figures for April, May 2019. And secondly, you talked a bit about room rates.
I think you said improving versus last year. But if you could talk a bit more about that, I guess, if you can work out the rate change versus 2019, if you give us the RevPAR numbers from the first question. And then the final thing, clearly, leisure demand is picking up nicely. Did you expect the sort of outlook to get a bit worse after the summer when the leisure component becomes a little bit less of the revenue mix? Thank you.
Yes. Currently, I don't have April and May report, and that's The honest question. So maybe we can start with some other questions here and see if we can find the number during the call here. So I'll need to send Henrik here out to try to see if we can get that number here in the meanwhile. So I mean the tricky question which you're raising here, Jurgen, is, of course, what we see here after the summer.
And the visibility is quite low. We as Jan said, we see more and more inquiries regarding the meeting side here now. So that is something which we are actually working with and also try to find out. We may do a lot of inquiries with the corporate customers and so on to see it and try to understand the path here. So I think we are a little bit in the dark right now when it comes to the level of demand during autumn.
I mean, what we have seen during the spring is basically this infrastructure You have a project for some reason, but if you take this white color business traveling, that has been more or less 0 here during Spring and not so much will happen prior to the vacation here in the Nordics. That's where you see So but we look forward to the autumn here with a positive view. I think the most important is that we don't have a setback when it comes to vaccination rates, when it comes to COVID-nineteen data. If the society and the authorities can deal with this damn virus, Then I think we have all the reasons to look positive to the recovery also when it comes to the corporate traveling year. But the visibility, looking into the numbers is very, very low.
So we cannot really get Any clues from that kind of analysis right now. So that is basically where we are with that. And that's not only due to the COVID. That's the normal that business traveling is picking up very, very late, even in a normal year. So that visibility is normally very low as well.
So There might be a small dip after an intensive summer. We saw that even last year and then picking up again once we come into earlymid September. But we expect also that the autumn September could be better than last year. If we are easing up restrictions as they currently confirm they are, so if we trust the governments, which we need to do, Then the autumn should be fairly okay. And on RevPAR, we haven't given our monthly RevPAR, but the Q2 April to June 2019, it was SEK 745 And it's more and usually, Dan, you and it's better than the other.
So that should It's probably a little bit lower than in April. So there is still a way to go, Jamie, here until we reach the old loan levels.
Yes. Thanks. I've obviously got the Q2 'nineteen number. It would just be helpful to get the RevPAR change For the months you've given, either by having the 2019 RevPAR to compare it against or to give us
the room rate I think also that, Jaime, if you're after the sequential improvement Between April May, you have so many other disturbances there. I think I mean, this is about weekends on weekends. It's about Easter, on and so on and whether it has been big events. I think that analysis is I don't I'm not sure that yes. But I think we will stick to giving you as many quarterly Update as we can with quarterly figures, but there's also, of course, a limit for how much data we will bring out even to the old market and competitors, etcetera.
So we are extremely transparent on this, And I'm very happy that we actually delivered. Also, we estimated like was set both in the Q4 and the Q1 reporting. And summer is picking up exactly like we anticipated, together with easing of restrictions. So that's a very good news.
Okay. Thanks.
And we have one more question from the line of Jonas Vaden from Tucci. Please go ahead.
Hello. Am I being heard? Yes. Hello. Okay.
Thank you. You talked about RevPAR and Cash flow, etcetera. Could you talk a little bit about personnel, staffing? How many people are actually working for you now as compared to pre pandemic levels? You just give me a rough estimate.
That will be helpful.
Around 10,000 people right now compared to 18,000 pre pandemic. So we are if you are in very, very rough numbers, we are just below 10,000 people right now, but we are hiring in a Few people here and there for the summer. But we were at a normal level during the summer. We would be some 18000, 19000 employees. So it is on some 55 percent of adornment.
And what are the trends right now, last couple of months? How is it coming up again?
Sorry, I didn't get that.
What's the trend? How has the numbers changed in terms of staffing the last couple of months.
I think it's just yes, Jan here, just to interrupt. I think what we focus on When we're controlling this is actually the number of working hours. Yes. And that is how we measure this because it is some so it's It might be that you have a different personnel mix of people who work part time and so on, depending on what kind of hotel you have, what kind of demand fluctuations you are having and so on. So what we're looking into when we try to control productivity and so on, that's the number of working hours you put in And how much do you actually need to pay for a working hour because that's the second element, which could be a little bit crucial and tricky from time to time.
So that is so it's a little bit of less significance, the number of names you have in the list here because It's a little bit about the individual talent. But we steer it extremely to Jens' point, we steer it this extremely tight in all markets to secure that we come out with an even higher productivity in working hours for the per customer, you can say per sales versus what we did before. So we are steering very, very tightly to secure that We become a more even more efficient company on the other side of the curve.
So how are working hours increasing right now? Quickly or slowly, what would you say?
I think the back part to your question is probably If we believe that we can improve productivity during the summer, and yes, that is something. I mean, when we look into during the Spring, we are on a much worse level than we did in 2019. So obviously, this is one of the most important The thing for us to do now is to see to that we take advantage, improve demand and see that we control working hours here. One of the tricks here is, of course, how we deal with the SMB outlets around our hotels. So we will continuously measure this looking to opening hours for restaurants and so on, see whether we should open also things like that.
I mean during this pandemic, we have been forced to take down the service level in many of these outlets. And so not only due to regulations, but also due to lack of demand. And for us to Control is now on this platform, I would say, a success factor to do that. So but make no mistake, we measure this On continuous basis now to see that we at least get something good out of this pandemic and that should be better productivity. And you can say the fact is that we have been during the pandemic not only putting people on furlough, we have also been displacing quite a lot of people.
And we do not bring back the same number of managers. So for instance, on managers level, we are fewer managers than before, And we will keep fewer managers in operation and on support offices than we did before. But of course, you can say that when in housekeeping, we were pretty efficient also before. And we just secure that we have a high productivity level and whenever occupancy now is picking up in with the blue color with us. So why we are pretty sure of this and confirm this again and Firm this again and again that we will be more efficient is that we steer it from management level also with less managers in wholesale level and above versus before.
All right. Thank you.
And as there are no further questions, I'll hand it back for any closing remarks.
Yes, but thank you for your time this morning, all of you, and thank you for dialing in and also for all of your very good and valid So from our side, we will be back in only about a month, 16th July, with an update on the Q2 result. But thank you for listening in. We are very happy to see this improved numbers right now, which is following also the estimates we were giving early on. So positive trend in all our regions. So now we are looking forward to see the last restrictions on the group being and in the markets being removed and vaccination to continue its peak.
Then we look forward for the summer and also for a better autumn. But thank you all, and We'll talk to you all in about a month from now.