NH HOTELES, S.A. AND DEPENDENT COMPANIES NOTES TO THE CONSOLIDATED
ANNUAL ACCOUNTS FOR 2006
1
ACTIVITY AND STRUCTURE OF THE PARENT COMPANY
NH HOTELES, S.A. (hereinafter the Parent Company) was incorporated as a Spanish public limited company (“sociedad
anónima”) in Spain on 23 December 1881 under the name “Material para Ferrocarriles y Construcciones, S.A.”, which was
subsequently changed to “Material y Construcciones, S.A.” (MACOSA) and then to “Corporación Arco, S.A.”
In 1992, Corporación Arco, S.A. took over Corporación Financiera Reunida, S.A. (COFIR) taking the corporate name of the
absorbed company and adapting its corporate purpose to the new activity of the Parent Company, based on management of its
portfolio of shareholdings.
In 1998 Corporación Financiera Reunida, S.A. (COFIR) merged with Grupo Catalán, S.L. and subsidiaries and Gestión NH, S.A.
via their takeover. Corporación Financiera Reunida, S.A. (COFIR) later took over NH Hoteles, S.A. and took the corporate name
of the absorbed company and extended its corporate purpose to allow it to directly carry out hotel activities, activities it was
already carrying out indirectly through its subsidiary companies.
The information relating to these mergers is set out in the annual accounts for the years in which these transactions took place.
In October 1999 a takeover bid was made for 100% of the capital of Sotogrande, S.A. which has enabled NH Hoteles to obtain
a majority shareholding of over 75% at all times.
In 2000 the expansion strategy began, essentially in Europe, aimed at creating a strong world brand in the city hotel segment.
This began with the integration of the Dutch Hotel firm “Krasnapolsky Hotels and Restaurants, N.V.”, continued with the
acquisition of the Mexican company “Nacional Hispana de Hoteles, S.R.L. de C.V.” in June 2001 and in 2002 with the purchase
of the German hotel company Astron Hotels.
In 2003-2005, through organic growth, the Group entered several European markets, such as Italy and Romania, and new cities
such as London. In 2005, it also embarked on its growth strategy in the quality tourism sector and with a high real estate
component with projects in Cap Cana (Dominican Republic) and Rivera Maya (Mexico).
In 2006, after the consolidation of the acquisitions made in previous periods, the Group continued its international expansion
strategy, with the acquisition of the Italian chain Framon and the agreement with Joker Partecipazioni, S.r.l. and Banca Intesa,
S.p.a. (today Banca Intesa Sanpaolo, S.p.a.) to acquire not less than 75% of the share capital of Jolly Hoteles, S.p.a.
At the end of 2006, NH Hoteles was already present, with operating hotels, in 19 countries, with 269 hotels and 38,990 rooms,
70% of which are in Spain, Germany and the Benelux countries.
NH Hoteles S.A.'s registered address is in Madrid.
2
BASIS OF PRESENTATION OF THE CONSOLIDATED ANNUAL ACCOUNTS AND
CONSOLIDATION PRINCIPLES
2.1
Basis of presentation of the annual accounts
The consolidated annual accounts for 2006, prepared by the Directors of NH Hoteles, S.A. at a Board Meeting held on 27 March
2007, have been obtained from the accounting records and annual accounts of the Parent Company and its Dependent Companies.
These consolidated annual accounts have been prepared in accordance with the International Financial Reporting Standards
(IFRS) adopted by the European Union in accordance with the terms of Regulation (EC) Nº 1606/2002, of the European Parliament
and the Tax, Administrative and Social Policy Measures Act, Law 62/2003, dated 30 December, to give a true and fair view of the
equity and financial situation of the Group as at 31 December 2006 and the results of its operations, changes in net equity and
the cash flows that have occurred in the Group during the year then ended in accordance with prevailing legislation.
The consolidated annual accounts of the Group and of the companies that comprise it for 2006 are pending approval by their
respective shareholders’ meetings. However, the Directors of the Parent Company believe these annual accounts will be
approved without significant changes.
The NH Hoteles Group has decided to implement earlier than required the changes of IAS 1: “Presentation of Financial
Statements”, that requires the inclusion of new breakdowns that enable users to assess the objectives; policies and procedures
for the management of capital (see Note 15).
Other standards issued by the appropriate bodies but whose implementation is not obligatory in 2006 would not have a
significant impact on these consolidated annual accounts.
NH Consolidated financial statements 2006
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