Scandic’s Interim report for the first quarter 2026 – Stable quarter and good booking situation

First-quarter net sales rose 3.1% to SEK 4,689 million, with organic growth of 4.7% and RevPAR up to SEK 665 from SEK 655. Operating profit improved to SEK 212 million from SEK 194, while adjusted EBITDA edged up to SEK 105 million from SEK 101. The release also showed occupancy improving to 55.8%, though EPS excluding IFRS 16 remained slightly negative at SEK -0.59.

Analysis

The print suggests the business is benefiting more from pricing/mix discipline than from true volume recovery. A low- to mid-single-digit RevPAR improvement against a modest occupancy gain implies management is still leaning on rate, which is healthier for margin durability than discount-led share capture. That said, the gap between operating profit and adjusted EBITDA quality signals meaningful below-the-line pressure and suggests the market should not extrapolate a clean earnings inflection yet.

The second-order read is that this is a late-cycle consumer/travel setup where the winners are the operators with balance sheet flexibility and exposure to higher-end, urban, or corporate demand. Economy and leisure-heavy peers are more vulnerable if the current occupancy improvement was driven by calendar effects or short-lived demand rotation rather than broad-based travel acceleration. Suppliers tied to renovations, franchise revamps, and booking tech can benefit if management continues to prioritize yield over footprint growth.

The main risk is that the current uplift is fragile: if consumer spending softens, occupancy will likely roll over before rate does, and RevPAR would decelerate quickly over the next 1-2 quarters. Free cash flow remains the key catalyst to watch; if it does not inflect with operating profit, the equity rerating case is limited. Consensus may be underestimating how little room there is for further margin expansion unless the company can sustain high single-digit rate growth without losing demand.

Key Decisions for Investors

• Stay neutral on the name into the next quarter; the setup looks good on headline growth but not yet strong enough for an outright long without free-cash-flow confirmation.
• If we have access to a listed hotel/operator basket, run a pair: long higher-quality upscale/corporate exposure vs short economy/leisure-heavy operators over the next 1-3 months; the former should preserve rate better if demand softens.
• Use any post-print strength to buy protective downside in the sector through 1-2 quarter-dated puts if available; the risk/reward favors downside convexity because occupancy improvements can reverse faster than pricing.
• Watch for confirmation in the next earnings cycle that adjusted EBITDA converts to cash; if free cash flow inflects materially, reconsider a long for a 3-6 month trade.
• Avoid chasing suppliers or subcontractors tied to hotel capex unless booking data continues to improve for at least two consecutive quarters; their upside depends on a sustained, not transitory, demand trend.