Selina Hospitality PLC (NASDAQ: SLNA) announced today its financial results for the full-year ended December 31, 2022.
Rafael Museri, Co-Founder and CEO, stated: “2022 has been a very important year in Selina's history. We completed our listing on NASDAQ in October 2022, and our business delivered strong improvement in our key operating metrics. We entered 2023 with a strong focus on three strategic imperatives: driving cash flow, executing on our path to profitability, and building our brand, which provides a differentiated travel experience to our growing number of guests. I believe that the new discipline around growth and cost management, coupled with a strong product offering, will position Selina as a leader in the hospitality space.”
Financial Summary
|
|
| Year Ended |
|
| ||
| ($ in millions, except hotels and bedspaces data) |
| December 31, |
|
| ||
|
| 2022 |
| 2021 |
| Percent Change | |
| Revenue |
| $183.9 |
| $92.7 |
| 98.3% |
| Net Loss |
| ($198.1) |
| ($185.7) |
| (6.2%) |
| Adjusted EBITDA1 |
| ($14.5) |
| ($25.7) |
| 77.2% |
| Net Cash Used in Operating Activities |
| ($23.6) |
| ($30.7) |
| 30.1% |
| Free Cash Flow Before Debt Service1 |
| ($72.8) |
| ($47.2) |
| (35.2%) |
| Occupancy Rate |
| 47.5% |
| 32.9% |
|
|
| Properties, End of Period |
| 118 |
| 100 |
| 18.0% |
| Bedspaces, end of Period |
| 29,600 |
| 23,408 |
| 26.5% |
| Total Annualized Revenue per Bedspace |
| $6,547 |
| $4,219 |
| 56.7% |
| ____________________ |
| 1 Adjusted EBITDA and Free Cash Flow Before Debt Service are non-IFRS measures. Please see Non-IFRS Financial Measures for reconciliation |
Full-Year 2022 Information
- Total revenue of $183.9 million, an increase of $91.2 million, or 98.3% compared to FY 2021, driven primarily by an increase in bedspaces from new opened locations, higher occupancy rates, and higher total revenue per bedspace.
- On a same-store basis (locations operating for the entire comparable periods), total revenue increased by 56.8% driven by an increase in occupancy, from 33.2% to 51.1%, and an increase in TRevPABs from 4,695 to 7,258.
- Selina opened 18 properties during 2022, ending the year with 118 properties, 29,600 open bedspaces, and 19,975 open beds (vs 23,408 open bedspaces and 18,438 open beds at December 31, 2021).
- Occupancy rate was 47.5%, compared to 32.9% for FY 2021, a 44.4% increase, driven by improved brand awareness and brand loyalty, a dedicated regional sales force and commercial teams, continued seasoning of our recently opened properties, and resumption of travel after two years highly impacted by COVID-19 and related travel restrictions.
- TRevPOB was $52.60 in FY 2022, compared to $45.86 in FY 2021, a 14.7% increase. TRevPOBs was $37.76 in FY 2022, compared to $35.13 in FY 2021, a 7.5% increase. These increases were mainly a result of a shift in our portfolio composition toward developed markets and continued seasoning of our recently opened properties. Of the 18 new locations opened in FY 2022, 16 are situated in developed markets.
- Total revenue per bedspace was $6,547 in FY 2022, compared to $4,219 in FY 2021, a 55.2% increase, driven by the increase in occupancy and the growth coming from developed markets.
- Unit Level Operating Loss was $6.7 million in FY 2022, compared to $18.0 million loss in FY 2021, with Mexico and Central America, where Selina benefits from mature locations, improving year over year. Selina is focused on improving performance in North America (U.S.), Europe & Africa and Israel, where Selina has grown in the last two years.
- Remote Year, the Company’s brand that facilitates group work and travel programs for remote workers in 80+ destinations, contributed $10.4 million in revenues in FY 2022 vs $4.5 million in FY 2021.
- Corporate Overhead as a percentage of revenues was 20.6% in FY 2022, compared to 33.1% in FY 2021, driven by economies of scale and a strong focus on efficiency in country, regional and global functions. Unit level labor costs as a percentage of unit level revenue was 27.6% in FY 2022, as compared to 28.3% in FY 2021.
- Adjusted EBITDA2 was $(14.5) million in FY 2022, compared to $(25.7) million in FY 2021, driven by the improvement in unit level performance, offset by an increase in corporate overhead and pre-opening expenses.
- Selina completed its business combination with BOA Acquisition Corp. and listing on the Nasdaq Global Market on October 27, 2022.
New Hotel Openings
- Opened 18 hotels with 3,692 bedspaces in a mix of new and existing markets, including 2 properties in the fourth quarter, with a total of 323 bedspaces, in Tel Aviv, Israel and Magnetic Island, Australia.
- Added approximately 2,500 bedspaces to 22 existing properties.
- As of December 31, 2022, the Company had 118 open hotels in 24 countries across six continents with approximately 29,600 open bedspaces, a 27% increase in bedspaces from the prior year period.
- Selina has signed agreements with third-party real estate partners who have committed $300 million of capital to finance the acquisition and initial conversion of future Selina properties, including the planned 2023 openings.
Cash and Cash Flow Highlights
- As of December 31, 2022, the Company had total cash and cash equivalents of $47.7 million.
- Net cash provided by (used in) operating activities totaled $(23.6) million for FY 2022, compared to $(30.7) million in FY 2021.
- Free cash flow before debt service1 totaled $(72.8) million for FY 2022, compared to $(47.2) in FY 2021.
- Capital expenditures, net of proceeds from partner loans, totaled $12.4 million in FY 2022 compared to ($5) million in 2021.
Select Unaudited Fourth Quarter 2022 Information
- Total revenue of $50.8 million, an increase of 64% compared to fourth quarter 2021, driven primarily by an increase in bedspaces from newly opened locations, higher occupancy rates, and higher total revenue per bedspace.
- On a same-store basis, total revenue increased by 24% for properties operated in both period fourth quarter 2021 and 2022.
- Open bedspaces (at period end) was 29,600.
- Open beds (at period end) was 19,975.
- Average daily open beds during fourth quarter 2022 was 18,552.
- Occupancy rate grew to 49%, up from 39% in the fourth quarter of 2021.
- Daily Total Revenue Per Occupied Bed (TRevPOB) increased to $59, up 24% compared to fourth quarter 2021.
- Daily Total Revenue Per Occupied Bedspace (TRevPOBs) increased to $37, up 8% compared to fourth quarter 2021.
- Total annualized revenue per bedspace increased to $6,742, up 36% compared to fourth quarter 2021.
| ____________________ |
| 2 Adjusted EBITDA and Free Cash Flow Before Debt Service are non-IFRS measures. Please see Non-IFRS Financial Measures for reconciliation. |
2023 Outlook
Selina reaffirms its goals, which for 2023 include annual revenue growth of 30 to 40% and achieving positive Adjusted EBITDA and operating cash flow.
Other 2023 Outlook Information
- Selina’s expansion strategy for 2023 will focus on three key principles: opening locations that generally ramp faster in occupancy and deliver more attractive financial performance, expanding existing locations with remodels and incremental leased spaces, and leveraging our brand to negotiate flexible lease terms with longer grace periods while shifting to variable rent for some new locations.
- While Selina will continue to expand its footprint in 2023, we have moderated our expansion plans. The current expansion plans demonstrate that Selina is both focused on cash flow and remains deeply committed to delivering an incredible experience to hotel guests and the local communities at unique hotels throughout the world, which in turn will drive revenue. The current expansion plan also shows that Selina is intensely focused on its cost structure and cash flow to position the company for achieving and sustaining positive Adjusted EBITDA and Free Cash Flow Before Debt Service going forward.
- While Selina’s operating momentum is strong and we continue to see progress in our core objectives, as noted in the Company’s Annual Report on Form 20-F for the fiscal year ended December 31, 2022, Selina does not yet have sufficient revenue to cover its operating expenses and our ability to achieve our objectives is dependent upon generating profitable operations in the future and obtaining additional equity or debt financing in the near term. During the course of 2023, management intends to raise additional funds through the capital markets, as necessary, and is assessing other options, including the restructuring of certain of its liabilities and/or the sale of non-core assets. While management believes that its fundra
About Selina Hospitality PLC.
Selina (NASDAQ: SLNA) is one of the world’s largest hospitality brands built to address the needs of millennial and Gen Z travelers, blending beautifully designed accommodation with coworking, recreation, wellness, and local experiences. Founded in 2014 and custom-built for today’s nomadic traveler, Selina provides guests with a global infrastructure to seamlessly travel and work abroad. Each Selina property is designed in partnership with local artists, creators, and tastemakers, breathing new life into existing buildings in interesting locations in 24 countries on six continents – from urban cities to remote beaches and jungles.
| SELINA HOSPITALITY PLC AND ITS SUBSIDIARIES | ||||
| CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | ||||
| U.S. DOLLARS IN THOUSANDS | ||||
|
| At December 31, | At December 31, | ||
| ASSETS | 2022 | 2021 | ||
| Current assets |
|
| ||
| Cash | 47,689 |
| 21,943 |
|
| Trade and other receivables, net | 10,543 |
| 10,527 |
|
| Inventory | 2,286 |
| 1,278 |
|
| Assets held for sale | 2,500 |
| 2,500 |
|
| Other assets | 16,681 |
| 10,119 |
|
| Total current assets | 79,699 |
| 46,367 |
|
| Non-currents assets |
|
| ||
| Property, equipment and furniture, net | 111,330 |
| 96,450 |
|
| Right of use assets | 420,800 |
| 311,637 |
|
| Intangible assets, net | 6,424 |
| 4,962 |
|
| Goodwill | 548 |
| 622 |
|
| Trade and other receivables, net | 1,671 |
| 1,925 |
|
| Investment in associates and joint ventures | 3,336 |
| 887 |
|
| Non-current financial assets | 3,149 |
| 3,156 |
|
| Security deposits | 10,910 |
| 9,773 |
|
| Other assets | 424 |
| 822 |
|
| Total non-current assets | 558,592 |
| 430,234 |
|
| Total assets | 638,291 |
| 476,601 |
|
|
|
|
| ||
| LIABILITIES AND EQUITY |
|
| ||
| Current liabilities |
|
| ||
| Trade payables and other liabilities | (81,526 | ) | (50,066 | ) |
| Loans payable | (37,678 | ) | (19,458 | ) |
| Convertible notes | (7,914 | ) | — |
|
| Lease liabilities | (59,115 | ) | (45,660 | ) |
| Derivative financial liabilities | (1,216 | ) | (76,906 | ) |
| Warrants | (1,481 | ) | (21,975 | ) |
| Total current liabilities | (188,930 | ) | (214,065 | ) |
|
|
|
| ||
| Non-currents liabilities |
|
| ||
| Loans payable, net of current portion | (97,996 | ) | (129,714 | ) |
| Convertible notes, net of current portion | (39,182 | ) | (97,316 | ) |
| Lease liabilities, net of current portion | (469,745 | ) | (348,972 | ) |
| Accounts payable to related parties | — |
| (3,472 | ) |
| Deferred tax liability | (329 | ) | (373 | ) |
| Employee payables | (6,852 | ) | (6,068 | ) |
| Total non-current liabilities | (614,104 | ) | (585,915 | ) |
| Total liabilities | (803,034 | ) | (799,980 | ) |
|
|
|
| ||
| Equity |
|
| ||
| Common stock | (488 | ) | (236 | ) |
| Additional paid-in capital | (563,210 | ) | (191,113 | ) |
| Currency translation adjustment | 1,452 |
| (4,464 | ) |
| Other reserves | 552 |
| — |
|
| Accumulated deficit | 725,248 |
| 518,979 |
|
| Total equity | 163,554 |
| 323,166 |
|
| Non-controlling interest | 1,189 |
| 213 |
|
| Total liabilities and equity | (638,291 | ) | (476,601 | ) |
| SELINA HOSPITALITY PLC AND ITS SUBSIDIARIES | ||||||
| CONSOLIDATED STATEMENTS OF PROFIT OR LOSS | ||||||
| U.S. DOLLARS IN THOUSANDS | ||||||
|
| 2022 | 2021 | ||||
|
|
|
| ||||
| Revenue |
|
| ||||
| Rooms |
| 108,602 |
|
| 51,335 |
|
| Food & beverage |
| 50,192 |
|
| 31,361 |
|
| Other, net |
| 25,141 |
|
| 10,041 |
|
| Total revenue |
| 183,935 |
|
| 92,737 |
|
| Costs and expenses |
|
| ||||
| Cost of sales |
| (25,370 | ) |
| (11,311 | ) |
| Payroll and employee expenses |
| (95,870 | ) |
| (57,162 | ) |
| Insurance, utilities and other property maintenance costs |
| (45,945 | ) |
| (31,480 | ) |
| Legal, marketing, IT and other operating expenses |
| (49,556 | ) |
| (33,676 | ) |
| Depreciation and amortization |
| (32,964 | ) |
| (31,235 | ) |
| Total cost and expenses |
| (249,705 | ) |
| (164,864 | ) |
| Loss from operations activity before impairment, government grants and COVID-related concessions |
| (65,770 | ) |
| (72,127 | ) |
| Impairment and write-off of non-current assets |
| (12,695 | ) |
| (11,153 | ) |
| Government grants |
| 1,739 |
|
| 2,099 |
|
| Income from COVID-related concessions |
| — |
|
| — |
|
| Loss from operations activity |
| (76,726 | ) |
| (81,181 | ) |
| Finance income |
| 75,021 |
|
| 90 |
|
| Finance costs |
| (123,251 | ) |
| (102,914 | ) |
| Share listing expense |
| (74,426 | ) |
| — |
|
| Gain on net monetary position |
| 3,178 |
|
| 1,725 |
|
| Share of profit / (loss) in associates |
| 84 |
|
| 62 |
|
| Other non-operating income / (expense), net |
| 2,480 |
|
| (661 | ) |
| Loss before income taxes |
| (193,640 | ) |
| (182,879 | ) |
| Income tax expense |
| (4,442 | ) |
| (2,844 | ) |
| Net loss |
| (198,082 | ) |
| (185,723 | ) |
| Loss attributable to: |
|
| ||||
| Equity holders of the parent |
| (197,107 | ) |
| (184,352 | ) |
| Non-controlling interest |
| (976 | ) |
| (1,371 | ) |
| Earnings per share |
|
| ||||
| Basic and diluted, loss for the year attributable to equity holders of the parent | $ | (3.73 | ) | $ | (4.29 | ) |
| SELINA HOSPITALITY PLC AND ITS SUBSIDIARIES | ||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||
| U.S. DOLLARS IN THOUSANDS | ||||
|
| Year ended December 31, | |||
|
| 2022 | 2021 | ||
| Cash flow from operating activities: |
|
| ||
| Loss for the year | (198,082 | ) | (185,723 | ) |
| Adjustments to reconcile net loss to operating cash flows: |
|
| ||
| Depreciation and amortization expense | 32,964 |
| 31,235 |
|
| Share-based compensation expense | 5,549 |
| 5,194 |
|
| Share of loss in associates | (84 | ) | (62 | ) |
| Impairment and write off of non-current assets | 12,695 |
| 11,153 |
|
| Gain on net monetary position | (3,178 | ) | (1,725 | ) |
| Finance costs | 123,251 |
| 102,914 |
|
| Finance income | (75,021 | ) | (90 | ) |
| Share listing expense | 74,426 |
| — |
|
| Income from COVID-related rent concessions | — |
| — |
|
| Income tax expense charged | 4,442 |
| 2,844 |
|
| Changes in working capital |
|
| ||
| Trade and other receivables | (265 | ) | (4,662 | ) |
| Inventory | (1,008 | ) | 71 |
|
| Trade payables and other liabilities | 6,882 |
| 5,723 |
|
| Other assets | (5,600 | ) | 2,391 |
|
| Taxes paid | (583 | ) | — |
|
| Net cash used in operating activities | (23,611 | ) | (30,737 | ) |
| Cash flow from investing activities: |
|
| ||
| Investments in financial assets | (352 | ) | (39 | ) |
| Purchases of property, equipment and furniture | (26,689 | ) | (14,421 | ) |
| Security deposits (paid) / returned | (1,137 | ) | 561 |
|
| Purchases of intangible assets | (2,663 | ) | (2,298 | ) |
| Proceeds from sales of property, equipment and furniture | 404 |
| 3,760 |
|
| Acquisition of business, net of cash acquired | — |
| 312 |
|
| Net cash used in investing activities | (30,437 | ) | (12,125 | ) |
| Cash flow from financing activities: |
|
| ||
| Proceeds from loans | 66,737 |
| 43,005 |
|
| Convertible note proceeds | 82,000 |
| 44,350 |
|
| Repayment of loans | (46,716 | ) | (5,424 | ) |
| Interest paid | (17,364 | ) | (6,018 | ) |
| Repayment of lease liabilities | (44,377 | ) | (24,764 | ) |
| Exercises of share options | 118 |
| 84 |
|
| Costs of equity raise | (7,470 | ) | — |
|
| Capital contributions | 44,450 |
| — |
|
| Proceeds from issuing equity instruments (DeSPAC) | 6,500 |
| — |
|
| Net cash provided by financing activities | 83,878 |
| 51,233 |
|
| Effect of changes in exchange rates on cash & cash equivalents | (4,084 | ) | — |
|
| Change in cash and cash equivalents during the year | 25,746 |
| 8,371 |
|
| Cash and cash equivalents at start of year | 21,943 |
| 13,572 |
|
| Cash and cash equivalents at end of year | 47,689 |
| 21,943 |
|
Key Metrics The table below sets forth our key business metrics for the periods presented:
|
| Year Ended December 31, | ||||||
| Metric | 2022 |
| 2021 | ||||
| Opened properties (at period end) |
| 118 |
|
|
| 100 |
|
| Open bedspaces (at period end) |
| 29,600 |
|
|
| 23,408 |
|
| Open beds (at period end) |
| 19,975 |
|
|
| 18,438 |
|
| Average daily open beds |
| 19,018 |
|
|
| 16,017 |
|
| Occupancy rate |
| 47.5 | % |
|
| 32.9 | % |
| Total daily revenue per occupied bed (TRevPOB) | $ | 52.60 |
|
| $ | 45.86 |
|
| Total daily revenue per occupied bedspace (TRevPOBs) | $ | 37.76 |
|
| $ | 35.13 |
|
| Total revenue per bedspace | $ | 6,547 |
|
| $ | 4,219 | |
Non-IFRS Financial Measures EBITDA, Adjusted EBITDA and Free Cash Flow before Debt Service
|
| Year ended December 31, | ||||||
|
| (In millions of US$) | ||||||
|
| 2022 |
| 2021 | ||||
| IFRS Net loss | $ | (198.1 | ) |
| $ | (185.7 | ) |
| Add (deduct): |
|
|
| ||||
| Income taxes | $ | 4.4 |
|
| $ | 2.8 |
|
| Finance income / (expense), net |
| 48.2 |
|
|
| 102.8 |
|
| Share listing expense |
| 74.4 |
|
|
| — |
|
| Depreciation and amortization |
| 33.0 |
|
|
| 31.2 |
|
| EBITDA | $ | (38.0 | ) |
| $ | (48.8 | ) |
| Non-operational income, net |
| (5.7 | ) |
|
| (1.1 | ) |
| Impairments |
| 12.7 |
|
|
| 11.2 |
|
| Non-Cash compensation expense |
| 6.9 |
|
|
| 6.2 |
|
| Non-recurring public company readiness costs |
| 7.6 |
|
|
| 3.3 |
|
| Provision for tax risks (non-income tax related) |
| 2.1 |
|
|
| 3.5 |
|
| Adjusted EBITDA | $ | (14.5 | ) |
| $ | (25.7 | ) |
|
|
|
|
| ||||
|
|
|
|
| ||||
|
| Year ended December 31, | ||||||
|
| (In millions of US$) | ||||||
|
| 2022 |
| 2021 | ||||
| Net cash used in operating activities | $ | (23.6 | ) |
| $ | (30.7 | ) |
| Add (deduct): |
|
|
| ||||
| Repayment on lease liabilities | $ | (44.4 | ) |
| $ | (24.8 | ) |
| Net cash used in investing activities |
| (30.4 | ) |
|
| (12.1 | ) |
| Non-recurring public company readiness costs |
| 7.6 |
|
|
| 3.3 |
|
| Proceeds from partner loans |
| 18.0 |
|
|
| 17.1 |
|
| Free Cash Flow before Debt Service | $ | (72.8 | ) |
| $ | (47.2 | ) |