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Grupo Posadas: Strong Expansion

Organic sgrowth, new hotels and more franchising is helping boost revenues and income at Grupo Posadas.


Mexico-based Grupo Posadas, the largest Latin American hotel operator, has been growing steadily in sales, while dramatically boosting its net income. In the first half of the year, its net sales reached a total of 2.9 billion Mexican pesos (approximately US$265 million), an increase of 3.3 percent from the same period last year. Majority net income, however, grew by a whopping 1,048 percent to 218 million Mexican pesos. 

"We have seen consistent growth throughout the company, but especially with the Fiesta Inn brand in which we have opened six new hotels," says Javier Barrera, vice president of franchise services.  "Our portfolio flourished during 2006 and 2007 with the launching of One Hotels in the three-star economy class segment and with the launching of Lat 19ª in the five-star business style category."

Posadas currently has three One Hotels locations and expects to open 70 additional properties under the same brand in the next five years, he says. All in all, Posadas operates 97 hotels with a total of 18,196 rooms in Mexico, Brazil, Argentina, Chile and the United States, as of June 30, 2007. Thats five more than the same period last year, although room numbers grew by 4.1 percent.

The Mexican company has been getting praise for boosting its margins on EBITDAR (earnings before interest, taxes, depreciation, amortization, and rent). "Posadas EBITDAR...margins have been increasing to about 30 percent, compared with about 25 percent in 2002, which is healthy compared with its industry peers," credit ratings agency Standard & Poor’s said in a recent research report.

S&P in June raised its long-term corporate and senior unsecured credit...

Keywords: AltiusPAR, AQUA, Brazil, Chile, franchising, Konexo Contact and Solutions Center, Lat 19ª, Mexicana, Oracle, PricewaterhouseCoopers


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