year in review more Group Highlights assets under management turnover hotel rooms under management employees UK Locations Business Divisions nationalities employed 1993 130 people, 3 managed properties 2006 Property Division Formed 2011 Construction Division Formed 2015 3 Business Divisions Hotels Property Grove Developments Chairman's Statement "On behalf of the Board and leadership team, I want to thank our family of colleagues for their continued effort, perseverance and commitment. The resilience in our ethic is shared across the entirety of Arora Group, and once again, demonstrates our powerful ability to report consistent growth. Our formula for vigorously strong success speaks for itself in its delivery and I am incredibly proud to lead this organisation forward, particularly as we continue to focus our efforts on new exciting projects, not least delivering the new terminal at an expanded Heathrow. Our objective in delivering long term value for all of our stakeholders remains firm, in spite of current economic instability and uncertainty with the UK looking to its future outside the European Union.” Surinder Arora, Founder and Chairman Financial Performance Building on the success of previous years, FY18 was another year of solid growth with strong operating cashflows and continued balance sheet strengthening. The Group has continued to further strengthen its competitive position, investing in value-added real estate projects by re-investing capital to deliver strong positive returns coupled with sustainable gearing. As we expand our portfolio in the United Kingdom, we will continue with our long-term approach of using our resources sustainably in developing our project pipeline FY13 FY14 FY15 FY16 FY17 FY18 Assets Under Managements (GBP - in Billions) Our Strategy continue to grow through strategic investments and constant operational efficiencies continue to be the best in our locations and operate at the highest service level standards ensure our corporate governance is best practice throughout the organisation Heathrow Expansion "We remain committed to the expansion of Heathrow, and the provision of choice for passengers and users. Our intent is expressed by our decision to make a formal bid to build and operate Terminal 6, to service Heathrow’s new third runway. We consider that our experience in providing the highest standards of service and hospitality at our hotels, together with our devotion to detail, make us the ideal developers and operators of this exciting addition to Britain’s leading airport, one that will put it once again among the world’s very finest. " Carlton Brown, Chief Financial Officer of Arora Group Key Appointments Globy Ouseph, General Manager, InterContinental London - The O2 Globy joined the Arora Hotels division in 2013 as a Hotel Manager and was subsequently as General Manager of Sofitel London Gatwick in April 2016. Prior to joining the Arora Group, Globy held the post of Hotel Manager at The Hilton Waldorf. Globy has 12 years of experience in the hotel and hospitality industry and started his career with the Oberoi hotels in India. Globy graduated from Bangalore University with a degree in Hotel management and has post-graduate qualifications in International Hospitality Management. Purchasing / Improvement A purchasing system was successfully implemented across the hotels estate. This system provides a consolidated purchasing platform to help ensure uniform purchasing and compliance across the hotels. We launched the system in May and all hotels were live by December 2017. The aggregate spend through the system for the 2017/18 financial year was £7m and this figure is expected to double in the next financial year. Spend data will allow us to focus our efforts on leveraging costs by product and vendor consolidation and identify cost saving opportunities as our business expands. We now have clear end to end new projects processes from budgeting, identifying and sourcing requirements, controlling project budget to completion of asset register. Purchasing for the new 761 room dual branded hotel at Terminal 4 was on track for the opening in FY19 and projected to be under budget. Food and beverage revenues continue to grow and has been a key focus for us in FY18. We instigated new contract terms with our largest suppliers and introduced new suppliers in the fish and fruit and veg categories to improve pricing, service and quality. We further engaged with the business and gained support to roll out a food buying strategy from summer 2018. Sunny Roda Group Purchasing Director "We continued to build on a strong FY17 in FY 18 in Central Purchasing as the business grows. During the financial year, we reviewed the departmental structure and laid the foundations to get the maximum benefit from our increased purchasing power." The Digital Journey Bira Bains Group IT Director "During 2018, IT focus has been on improving governance, controls and processes in line with GDPR compliance rules, which meant replacing and upgrading many of our core systems and infrastructure across the Hotels and Head Office. IT have also played a key role in the successful launch of the Hotels at T4 and integration of the new acquisition, Bucks Golf Club, into the business. IT's revenue contributions to the M&E business for additional IT conferencing services have also increased when compared to previous years. Our ongoing focus remains on supporting the business on new initiatives and ensuring the technology we implement is right for the company and delivers the benefits. " Key highlights from 2018 include: Technology provision and systems setup at the new T4 Crowne Plaza & Holiday Inn Express Hotels. GDPR compliance across the Group & PCI certification at the Accor branded hotels. Higher revenue contribution to M&E business than prior years. Implementation of a new Finance system across the Group. Major system replacements and upgrades at the Hilton & Accor branded hotels and Head Office. Arora Hotels Arora Hotels was established in 1999 and continues to remain at the core of service delivery and revenue creation. We are proud to have maintained high customer service delivery throughout the division adding two new brands to the portfolio. Group Hotel Highlights rooms by December 2018 operated hotels people meeting rooms restaurants and bars Business Overview Following on from the success of FY17, the accompanying alignment of hotel operations delivered Arora Group’s strongest results in both expansion and organic growth in FY18. The relentless passion of our hotels teams, in upholding our service values of delivering exceptional service to our guests, has resulted in our key SBU’s online reputational scores reaching #1 on TripAdvisor in all three UK airport markets (Heathrow, Gatwick and Stansted). Our flagship hotel, InterContinental London – The O2 has, in turn, held a position in the top 5% of hotels in the London market respectively. Investment in the hotels continued in FY18 and refurbishment programmes were completed three of our the 4 locations, with exciting further investment in key strategic locations considered for our future. Vincent Madden Director of Hotel Operations "Arora Group continues to build on its strong asset base, through the access to world-class brands and global distribution, our long-standing partnership with multiple global brands. We pride ourselves on the high level of service provided to our guests in every one of our business functions." Business Activity by Hotel Sofitel Heathrow (28) Sofitel Gatwick (15) ICO2 (21) Renaissance (14) Arora C (4) HIT5 (2) Hilton G (12) Novotel (4) Commercial Overview Continued focus of business development at InterContinental London – The O2 in its second full year of operation resulting in an almost 20% year on year top line revenue growth. Successful completion of the re-brand of our Stansted property from Hilton to Novotel whilst retaining the contractual commitment of all the Hotel’s major corporate and airline customers. Closure of Savill Court Hotel and Spa and the commencement of the complete re-development and construction of a new 5 star luxury hotel and spa. Agreement to take on the operational lease of Hilton Gatwick under a franchise agreement with Hilton bringing into the Arora Group the largest operating hotel in relation to number of bedrooms at 821. Raj Shah Commercial Director "FY18 proved to be another positive year in terms of top line revenue growths in the hotels division through a combination of acquisition, re-branding, refurbishment and targeted sales growth. We remain focused on driving sales and revenue efficiencies amongst our airport hotels and continue to explore new market opportunities with the InterContinental London – The O2 and also announced our ambition to foray into the high end luxury market by starting with the complete re-development of Savill Court Hotel to a luxury 5 star hotel and spa in Windsor. As well as consolidating airport related revenue streams including a successful year in re-contracting major crew contracts, the focus on the meetings and events market continues to remain a priority." Hotels Overview Holiday Inn T5 Renaissance London Heathrow Hilton London Gatwick Sofitel London Heathrow Sofitel London Gatwick Arora Hotel Gatwick Crawley Novotel Stansted InterContinental London The O2 Sofitel London Heathrow FY18 has been a year of transformation for Sofitel London Heathrow as we build upon our past successes. We have seen our highest rooms revenue year, with record ADR, since opening in 2008. Our award-winning food and beverage experience remains the best in the market and continues to achieve ambitious targets, whilst satisfying the high standards of the Sofitel brand. Most of all, we are proud to continue deliver sustainable growth after nearly a decade of opening. Ryan Nicholls General Manager, Sofitel London Heathrow "We have strengthened our team with excellent senior appointments this year, who will further strengthen the team to ensure we continue to provide a luxurious guest experience for all of our guests. We remain the best hotel in Heathrow and we certainly remain and compete amongst the top meetings hotels in London." languages spoken (3 AA Rosette)Award winning restaurant in the market meeting delegates hosted positive reviews on survey websites kgs of cardboard recycled glass bottles recycled InterContinental London - The O2 FY18 has been an unprecedented year for the InterContinental - The O2 In the second full year of operations it managed to scale to new heights and elevate benchmarks for many years to come. A combination of teamwork, leadership and clear objectives were the key factor to many of our successes, which subsequently, generated impressive revenue figures, emphasising the hotels market position. Globy Ouseph General Manager, InterContinental - The O2 "The vision of the hotel is to synergise expert service levels and employee satisfaction processes to leverage a memorable experience for our guests, in line with our company ethos and objectives." Achieved Elite status for overall guest satisfaction in Q2 (92%). Hotel shuttle launched offering guests and added element of luxury Peninsula Restaurant listed on the 2019 Michelin Guide along with a 3 Michelin Takeover Ranked 1st in Europe for IHG breakfast, meetings and heartbeat. Highly commended for our Afternoon Tea at afternoontea.co.uk. awards. Host the first New Year’s Eve fireworks Overall revenue growth of 22% along with an EBITDAR growth of 37% 40 different Nationalities working as one Team 18,000+ social media followers Renaissance London Heathrow 2018 has been a record year for the Renaissance Hotel achieving its highest profit under Arora Management. An improved market share was achieved through an impressive growth in occupancy of 7.5% in the year. The Renaissance continues to be the hotel of choice for travellers with its close proximity to Terminals 2 & 3 and unrivalled views of the Northern runway. Yousif Al-Wagga General Manager, Renaissance London Heathrow "Providing personal service on a large scale is delivered through having a truly diverse workforce." Record profit in the month of July 15+ Languages Spoken 226,000 rooms sold Social Media ranking of 3 of 28 Heathrow Hotels Hosted 617 meetings Achieved the highest ever Marriott brand audit score Supported The Springboard Charity through “taster days” and work placements Sofitel London Gatwick 2018 has been an exceptionally successful year, the best in the hotels history. Our ambitious team go the extra mile at every opportunity and showcase the values endemic to Arora Group which make each and every guest’s stay memorable. Through our teams effort and execution of strategy, the hotel has achieved the highest revenue in its history. Our guest feedback and quality scores have increased in all areas supporting our achievements across the board, which has led us to outperform the market in all measures. We look forward to FY19 where we will continue to strive towards stronger ambitions. Yasmin Keen General Manager, Sofitel London Gatwick "We strive together to create loyalty and engagement with our customers & ambassadors by putting the guest at the heart of everything we do. Creating experiences enable us to be the market leader and in turn, engineer a great place to work and to stay." languages spoken guests welcomed ranked hotel on Trip Advisor 5-Star Reviews on TripAdvisor number of nationalities employed Hilton London Gatwick Airport FY18 was an exceptional year for Hilton London Gatwick Airport. Whilst achieving record breaking occupancies in a very competitive market, we maintained a healthy profit and achieved our highest team member satisfaction score. Kara Monteiro General Manager, Hilton London Gatwick "Providing exceptional guest experiences delivered by a passionate team is the heart of Hilton London Gatwick Airport." rooms sold breakfasts served raised in charitable donations charities and local projects supported growth in social media engagement Novotel London Stansted FY18 has been a strong year for Novotel London Stansted, where we have consolidated our position in the market place following our refurbishment and rebranding to Novotel. We maintained and enhanced our corporate clients through our relationships and exposure in the local community. Paul Muscroft General Manager, Novotel London Stansted "Having an engaged team of hospitality professionals around me, with natural ability, who offer personal stylised service with each and every guest, combined with a desire to be the best in Stansted, has resulted in becoming #1 hotel on TripAdvisor." languages Spoken people work with us Guest Room Nights hotel on Tripadvisor meetings held increased occupancy year on year Arora Gatwick Crawley Arora Hotel Gatwick/Crawley remains a key asset to Arora Group Gatwick portfolio of hotels, as we continue record levels of service and financial performance, in line with the forward-focused targets set across the entire company. Harish Sunassy Hotel Manager, Arora Gatwick Crawley "It has been a real pleasure for me to join the team in 2018 and contribute to another record year in terms of market share. We have exciting times ahead of us to continue deliver exceptional results for this deluxe hotel in the Gatwick area." ranked hotel on Tripadvisor years since opening people work with us AA Rosette only Rosette restaurant in Crawley number of nationalities employed meeting delegates hosted Holiday Inn Heathrow T5 Holiday Inn London Heathrow T5 innovates an environment where guests can feel at home in our hotel, to create consistently high levels of guest satisfaction. The operations team fully embraces the Arora Group ethos achievement through ownership to maintain a professional environment for all. FY18 has proved as another satisfactory year in terms of revenue and the hotel greatly looks forward to the aspirations that are ahead of us in FY19. Sharad Rekhi Hotel Manager, Holiday Inn Heathrow T5 "Having an engaged team with a natural way of expressing personal and a friendly service to each and every guest, and a desire to be the favourite hotel to stay in Heathrow, is where our business is born from." languages spoken rank hotel on Tripadvisor nationalities employed hotel within IHG for loyalty enrolments Arora Property The Arora Property division was set up in 2005 to provide a property management and asset management service. It currently manages over £1.5 billion of property assets which include operated hotels, a portfolio of externally leased hotels, offices and commercial spaces as well as land holdings across London, major regional airports, home counties and Scotland. Property Overview Mark Higgins Managing Director, Property Division "In line with our wider objectives, maximising our capacity for rent and minimisingvoids has been key towards the success of FY18. Looking at our long term development, we are consistent in acquiring new assets in strategic locations, with new property at Heathrow and Gatwick on-target for completion in FY19. " Transactions to Date: 47 FY17 FY18 Assets by Geography Heathrow Gatwick Stansted Windsor London Other Grove Developments Arora Group continues to expand, develop, and consolidate a diversified property asset portfolio in targeted UK locations. Construction Grove Developments disciplined approach on winning new business by ensuring that work we take on meets our business profile has dramatically impacted our potential for growth. By selecting our sectors with careful consideration on types of projects and location, we have added significant value to the Groups business portfolio. Sinead Hughes Director, Grove Developments "FY18 was a successful year focusing on large scale hospitality and commercial projects including new builds and major renovation work. Our approach on 'lean construction’ and optimising on design and build process to deliver better value to clients and end-users has been demonstrated on the recently completed projects and future endeavours. We remain on track to deliver multiple developments in FY19." FY14 FY15 FY16 FY17 FY18 Number of Projects Live Projects FY18 World Business Centre 4 Talent and Culture The year has provided opportunity to rethink roles and structures within the Human Resources function which has led to a more proactive job role being created with an increased focus on talent acquisition and creating the right culture for people to grow. This has been done by providing managers with the skills to coach and engage their teams. The requirement for us to grow our own talent pipeline is more important than ever as we continue to give our people career paths to enhance engagement and retention. We focused on driving employee engagement aiming at delivering a holistic employee experience, understanding and improving the working environment is critical for Arora in this highly competitive recruitment market. Continued focus on attracting the best people and giving them opportunity to grow. Internal development remains the focus with over 300 internal promotions within the group. Talent and culture teams have been introduced with the primary focus of increasing the talent pipeline and relationships with schools and colleges increasing apprenticeship opportunities across the Arora Group. Management of Savill Court closure by re-deploying 80% of the team into other roles within the Arora Group. Relaunch of applicant tracking system increasing 30% of applications from previous systems. Launch of Future Leaders Management Development programme aimed at developing skills of managers to enable them to become leaders across our business as well as Arora Foundations for Supervisors with the goal of becoming a manager. Successful transition and re-branding of Hilton Stansted to the Novotel Stansted through the implementation of welcome to Novotel and Life Genius programmes. Acquisition of the Hilton London Gatwick and the successful TUPE of 220 employees. Talent and Culture Highlights FY18 number of nationalities in Arora total number of employee no of people recruited April 2017 – March 2018 Key Principles Reliable Excellence A hallmark for excellence, with a track-record of end-to-end delivery of outstanding quality and service, in everything we do Transformational Driving positive transformational impacts with every project, from Greater London regeneration residential projects to leading business-traveller destinations across the UK Collaborative Deriving strategic advantage from synergies across our specialist divisions - hotels, property and construction – and working collaboratively with stakeholders as a trusted partner of choice Experts in the field Succeeding in challenging projects by building on our extensive, specialist experience in complex transport, leisure, commercial and residential hubs Strategic Growing sustainably towards long-term goals with a strong, diverse and detail-orientated management team.