Emma Villas 1H24 Results
Aggressive M&A and hires in a clear bet on growth, but in the short term, it affects profitability
Analysis of the 1H24 results of Emma Villas, a small luxury vacation home rental company that operates mainly in Italy. It manages more than 700 Italian Villas, mainly in Tuscany, with multi-year contracts where they have the exclusive management of the properties.
Emma Villas made its IPO just a year ago and his CEO retains the majority of the stack. You have available the investment thesis and the downloadable financial model
Emma Villas has reported rather weak results for 1H24, despite continuing to increase its revenues (+6%) compared to the same period last year. Its profitability has been significantly impacted by the substantial rise in personnel expenses, stemming from its acquisitions and team expansion.
The results must be read with an understanding of the payment scheme (they receive 70% before the reservation), the company's enormous seasonality (reservations are concentrated in the June-September period), but salaries, service expenses, and payments to owners (depending on the type of contract) must be paid throughout the year.
Revenues € 8.03MM, +6% vs 7,61 MM en 1H23
EBITDA -€ 4,33 MM VS -€ 2,54 MM EN 1H23
Net Income - €3,58 MM vs -€2.19MM en 2023
€14 MM net cash ( its market caps is €19MM) due to seasonality
The updated billing at the end of August is €31.51 million and includes part of the future reservations for 2024 (from September to December), already confirmed as of August 31.
As of June 30, 2024, the total number of contracted villas amounts to 652 units, compared to 543 units at the end of 2023. By the end of September (including the acquisition of Comus Rental at the end of July), they have 710 properties.
As of September 30, the number of reservations for 2024 has increased by 3% compared to 2023 (7,742 vs. 7,505). Last year, they ended the year with 7,633.
With the increased flexibility in reservations (previously, bookings could only be made for one week, but now they can range from 3-4 days to 10-12 days), it is important to note that the average number of nights per reservation for 2024 is 7.88, compared to 7 last year.
We believe that the company's recent moves change its profile in the short, medium, and long term. let’s analyse this.