MHV Mediterranean Hospitality Venture Plc on Friday reported a net loss of €5.07 million for the six months to June 30, 2026, narrowing significantly from a €10.22 million loss in the corresponding period of 2025, despite lower overall revenue and the impact of the Middle East conflict on its Cypriot hotels.

The group’s operating result improved substantially, with operating profit reaching €639,772, compared with an operating loss of €6.70m in the first half of 2025.

However, higher finance costs, which increased by €1.94m to €4.34m, weighed on the bottom line.

MHV said its business had experienced a steady recovery since May after the escalation of the conflict in the Middle East affected hotel performance, particularly during March and April.

The group said the geopolitical situation involving Iran had affected the performance of its Cypriot hotels during the first half of 2026, while management believed the negative impact would be contained until the end of the year.

Revenue falls as hotel contribution increases

Group revenue fell to €32.12m in the first half of 2026, from €37.23m a year earlier. The company attributed the overall decline mainly to a €12.15m reduction in revenue from real estate activities.

This was partly offset by a €6.62m increase in hotel operating revenue, the latest report showed.

The increase in hotel revenue was driven mainly by the reopening of The Landmark Nicosia, Autograph Collection in December 2025 and the acquisition of Rinascita SA, which operates the Moxy Athens City Hotel.

The Landmark Nicosia generated €6.81m in revenue for the group during the six-month period. Rinascita, which was acquired in March 2026, contributed a further €2.68m.

However, revenue from Parklane Hotels Limited declined by €2.94m compared with the first half of 2025.

The group attributed the decline mainly to lower occupancy at Parklane during March and April, when the escalation of the conflict in the Middle East affected its Cypriot hotel operations.

Despite the overall decline in revenue, MHV said its operating performance benefited from a reversal of impairment charges.

The group recognised a €3.80m reversal of impairment charges on land and buildings under development, compared with a €2.25m reversal during the first half of 2025.

The first-half 2025 operating result had also been hit by a €10.11m loss from the sale of a 30 per cent stake in MHV Bluekey One SA to Papalon Investments Limited.

Underlying operating profit falls

MHV said that after excluding the effects of impairment reversals, depreciation, amortisation and the loss from the sale of the investment in MHV Bluekey One, its operating profit stood at €1.88m, compared with €4.13m in the previous year.

This represented a decline of €2.25m.

The adjusted figure included €4.94m in reversals of impairment on land and buildings, property under construction and land and buildings under development, compared with €3.38m in the first half of 2025.

Depreciation of property and equipment, depreciation of right-of-use assets and amortisation of intangible assets increased to €6.18m, from €4.09m a year earlier.

The company attributed the decline in operating profitability primarily to the geopolitical situation involving Iran and its effect on the performance of its Cypriot hotels during March and April.

“The business has experienced a steady recovery since May, and management believes that the negative impact is going to be contained until the end of the year,” MHV said.

Net finance costs rose from €2.40m in the first half of 2025 to €4.34m, an increase of €1.94m. The group attributed the increase mainly to higher borrowings during the period.

At June 30, MHV had total assets of €843.38m, compared with €710.91m at the end of 2025. At the same time, net assets increased to €500.16m, from €422.93m at December 31, 2025.

Other comprehensive income also increased substantially, reaching €17.83m, compared with €3.20m in the first half of 2025.

MHV attributed the increase mainly to a revaluation gain on land and buildings and its share of other comprehensive income from a joint venture.

Expansion of hospitality portfolio

During the six months to June 30, MHV significantly expanded its hospitality portfolio through a corporate restructuring and the contribution of assets by its parent company, Prodea Real Estate Investment Company SA.

The group acquired a 75 per cent interest in Five Lakes Fund, a closed-end real estate fund that owns The Bellevue Hotel Cortina in Italy.

The acquisition was made through the establishment of Tofane Investments RAIF V.C.I.C. Plc, a Cyprus-incorporated fund in which MHV holds a 75 per cent direct interest.

All of the units in Five Lakes Fund were contributed to the Tofane Fund on March 19, 2026.

The group also acquired 100 per cent of Rinascita SA on March 24, 2026.

Rinascita has a long-term lease over a multi-storey building in central Athens, which it operates as the 200-room-plus-one-suite Moxy Athens City Hotel.

On June 30, MHV acquired 100 per cent of Papalon Investments Limited.

The three transactions were carried out as part of a corporate restructuring and involved the contribution of hospitality assets by Prodea to MHV.

In consideration for the contribution in kind, MHV issued and allotted 85.165m additional ordinary shares, each with a nominal value of €1.

The assets contributed by Prodea were valued at €44.91m for Five Lakes Fund, €13.83m for Rinascita SA and €26.42m for Papalon.

The combined value of the contributed assets was therefore €85.17m, corresponding to the number of additional shares issued.

Earlier changes to Bluekey ownership

The latest transactions follow earlier changes to MHV’s ownership of MHV Bluekey One SA. The group lost control of MHV Bluekey One SA on February 21, 2025, following the sale of its 30 per cent shareholding.

Following the sale, MHV recognised its remaining interest as an investment in a joint venture.

The group regained control of MHV Bluekey One SA on December 5, 2025, following a wider transaction involving its parent company Prodea.

Its 70 per cent interest in MHV Bluekey One SA was subsequently reclassified as a subsidiary.

The changes form part of a broader restructuring of MHV’s hospitality portfolio and have also affected the group’s reported financial results between the two periods.

Hotels and real estate

MHV’s hospitality portfolio includes Parklane, a Luxury Collection Resort & Spa in Limassol, held through its wholly owned subsidiary Parklane Hotels Limited.

The group also owns The Landmark hotel in Nicosia through The Cyprus Tourism Development Company, following the completion of its extensive renovation and reopening in December 2025.

Its Greek portfolio includes Nikki Beach Porto Heli in Argolida, Porto Paros in Paros and Moxy Athens City Hotel in central Athens.

The group also has an interest in Hotel Bellevue in Cortina d’Ampezzo, Italy, through its joint venture in Tofane Investments RAIF V.C.I.C. Plc.

The Bellevue property is currently undergoing extensive renovation and is scheduled to reopen in December 2027 as Bellevue Hotel Cortina d’Ampezzo, Emblems Collection, by Accor.

Outside hospitality, MHV owns and develops several real estate assets.

These include Park Tower, a luxury residential development in Limassol, through Parklane Hotels Limited.

The group also owns a residential complex in Pyrgos, Limassol, through Stromay Holdings Limited, which is used to house staff working at the Parklane hotel.

MHV is also developing The Landmark Nicosia Towers, comprising an office tower and a residential tower on the site of The Landmark Nicosia, Autograph Collection.

Outlook

MHV said the group had continued to recover following the disruption caused by the escalation of the conflict in the Middle East earlier in the year.

The company said the business had experienced a steady recovery since May and that management expected the negative effects of the geopolitical situation to remain contained through the end of 2026.

The group said its principal risks and uncertainties remained similar to those disclosed in its annual consolidated financial statements for the year ended December 31, 2025.

It added that its critical accounting estimates, judgements and assumptions were set out in the notes accompanying its unaudited interim condensed consolidated financial statements.