REPORT ONTHE CONSOLIDATED
FINANCIAL STATEMENTS
NHHOTELES, S.A. AND SUBSIDIARIES
REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS FOR 2013
1.-
ACTIVITY AND COMPOSITION OF THE PARENT COMPANY
NH HOTELES, S.A. (hereinafter the Parent Company) was incorporated as a public limited company in Spain on 23 December 1881 under the trade name “Material
para Ferrocarriles y Construcciones, S.A.”, which was subsequently changed to “Material y Construcciones, S.A.” (MACOSA) and, subsequently, to “Corporación Arco,
S.A.”.
In 1992, Corporación Arco, S.A. took over Corporación Financiera Reunida, S.A. (COFIR), while at the same time adopting the trade name of the company taken over
and amending its corporate purpose to the new activity of the Parent Company, which focused on the management of its shareholding portfolio.
In 1998, Corporación Financiera Reunida, S.A. (COFIR) merged with Grupo Catalán, S.L. and its subsidiaries and Gestión NH, S.A. through the absorption of these
companiesbytheformer.Subsequently,CorporaciónFinancieraReunida,S.A.(COFIR)tookoverNHHoteles,S.A.,adopted itstradenameandbroadened itscorporate
purpose to allow for the direct performance of hotel activities, activities in which it had already been engaged indirectly through its subsidiaries.
Information on these mergers can be found in the financial statements of the years in which said transactions took place.
InOctober 1999, a public takeover bid for 100%of the capital of Sotogrande, S.A. was launched, which has allowed the Company to hold a permanent controlling interest
exceeding 75%.
An essentially European expansion strategy was initiated in 2000 aimed at creating a strong global brand in the city hotel segment through the incorporation of the
Dutch hotel company “Krasnapolsky Hotels and Restaurants N.V.”, followed by the acquisition of theMexican company “Nacional Hispana de Hoteles, S.R.L de C.V.” in
June 2001 and the purchase of the German hotel company “Astron Hotels” in 2002.
Between 2003 and 2005, the organic growth of the Group enabled it to break into different Europeanmarkets, such as the Italian and Rumanianmarkets, as well as into
new cities such as London. It also entered the quality tourist sector, with a significant real estate component, in 2005 with projects in Cap Cana (Dominican Republic)
and the Mayan Riviera (Mexico).
After consolidating the acquisitions made in previous periods, the Group continued with its international expansion strategy in 2007 and 2008 through the acquisition
of the Italian hotel chains, Framon and Jolly Hotels.
In 2009, the Group entered into an agreement with Grupo Inversor Hesperia, S.A., (“Hesperia”) to merge their respective hotel management businesses, whereby it
would manage the 49 hotels owned or operated by Hesperia. The Group currently manages 39 hotels.
The Parent is the head of a group of subsidiaries engaged in the same activities and that constitute, together with NHHoteles, S.A., the NHHotels Group (“the Group”
–
see Appendices I and II).
At the end of 2013, the Group was operating hotels in 27 countries, with 379 hotels and 58,195 rooms, of which around 76% are located in Spain, Germany, Italy and the
Benelux.
NHHoteles, S.A. has its registered address inMadrid.
2.-
BASIS OF PRESENTATION OF THE CONSOLIDATED FINANCIAL
STATEMENTS AND CONSOLIDATION PRINCIPLES
2.1
Basis of presentation of the Financial Statements
The consolidated financial statements for the year ended 31 December 2013 were formally prepared by the directors of NH Hoteles, S.A. at their Board of Directors
Meeting held on 27 February 2014, in accordance with the regulatory financial reporting framework applicable to the Group, which is that established in the Spanish
Commercial Code and all other Spanish corporate law. and in the International Financial Reporting Standards (IFRS), as adopted by the EuropeanUnion in conformity
with Regulation (EC) no. 1606/2002 of the European Parliament and of the Council and Law 62/2003, of 30 December, on tax, administrative, labour and social
security measures, and, accordingly, present the Group’s consolidated equity and financial position at 31 December 2013 and the results of its operations, the changes in
consolidated equity and the consolidated cash flows for the year then ended.
REPORT ONTHE CONSOLIDATED FINANCIAL STATEMENTS
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