QMH reveals F&B expansion plans

By Andrew Sangster

Queens Moat Houses (QMH) has revealed the importance it places on non-room sales in its recovery by appointing a board-level director of food and beverage.

Stephen Minall was appointed this week as F&B director for the UK hotel division. He was formerly managing director of CMI, a Dublin-based company bought by the Compass Group, and has had experience of the US catering market.

"Our F&B is a £100m business and it warrants a dedicated professional," Andrew Coppel, QMH chief executive, told Caterer. "Stephen has the background to bring significant benefits to the business."

During the financial year ended 31 December 1995, more than 50% of sales came from F&B, compared with 44% from bedrooms.

The company's financial results, announced last week, show considerable progress has been made in QMH's recovery. Losses before tax and exceptional profits were £2.5m, compared with a £59.2m loss in 1994.

Operating profits were up 27% to £44.7m after a 6% rise in sales to £454.1m. The best-performing division was the UK, where the 83 hotels at the year end achieved a bedroom occupancy of 66.8% and an average achieved room rate up £1.29 to £42.29.

The Moat House brand continues to lead the way and revealed a rooms yield growth of 11.8% compared with the UK division's average of 11%.

Mr Coppel said a combination of yield management and a capital expenditure programme was driving the lift in profitability. Last year, £33.5m was spent, of which £24.2m was invested in the UK. In the past two years, 46% of Moat House bedrooms have been refurbished.

This year, a similar level of capital expenditure is planned and the UK will remain the focus for any development spending.

Leisure facilities are also being expanded and work has started on a £1m leisure club at the 118-bedroom Cambridge Garden House Moat House, set to open in September.

There is growing confidence at QMH that the company will be able to cover its debt burden. This appears to be a view shared by at least one investor who has built up an 11% stake in the company, but who is not thought to be planning a bid.

The ongoing disposal programme will help meet debt repayments, which this year will total £14.3m. Stakis last week paid £3.4m for the 147-bedroom Europa Hotel at Wallsend, near Newcastle, as predicted in Caterer.

Earlier this year, the 90-bedroom Dean Park Hotel in Watford, Hertfordshire, was sold. Of the 16 County Hotels put up for sale through Christie & Co last year only five remain, of which three are under negotiation.

• Stakis said it intended to invest £3.5m converting the Europa Hotel into a 110-bedroom, four-star standard property, to be known as the Stakis Tyneside. Stakis has also paid £600,000 for Crandmill, the company that operates the Park Casino in Cardiff.