Dalata reports 'strong financial position'

17 December 2020 by
Dalata reports 'strong financial position'

Dalata Hotel Group has announced that, despite the challenging environment, earnings before interest, tax, depreciation and amortisation (EBITDA) for the year ending 31 December 2020 are expected to be marginally ahead of market expectations and the group remains in a strong financial position.

In a year end trading and development update, the group said it has "significant financial headroom" to support the business through the ongoing recovery and continue on its path of growth and development with current cash and undrawn debt facilities of €293m (£264.1m) after deducting upcoming payments including quarterly rent and interest.

During December, bookings have been encouraging but are on short lead times and occupancy for the fourth quarter is projected to be 17% in Dublin, 28% in regional Ireland and 21% in the UK.

The outlook for 2021 remains uncertain with short lead time on bookings. It is not yet known when international travel will return to more normal levels.

Dalata is continuing to progress a development pipeline of almost 3,250 rooms across Ireland and the UK. In Q4 2020, it completed the 44-bedroom extension at Clayton Hotel Birmingham and its Maldron Hotel Glasgow is scheduled to open in summer 2021.

Construction continues at its four hotels in Glasgow, Bristol and Manchester, with Clayton hotels in Manchester and Bristol scheduled to open in Q1 2022, while the Maldron Hotel Manchester and Clayton Hotel Glasgow are scheduled to open in Q2 2022.

Construction for the Maldron Hotel Shoreditch (pictured- in London is expected to commence towards the end of Q1 2021, with the hotel projected to open mid-2023; while construction works at the Maldron Hotel Birmingham and Maldron Hotel Liverpool are hoped to begin in mid-2021. Planning processes for the Maldron Hotel Brighton and Maldron Hotel Victoria in Manchester continue to progress.

Dermot Crowley, deputy chief executive – business development and finance, said: "We have an exciting pipeline of hotels to open over the next three years. Despite the devastating impact of Covid-19, we announced three new hotels during 2020 in Dublin, Brighton and Manchester. We are working with developers and site owners around the UK on potential new developments.

"The positive impact of the recent equity placing on our balance sheet together with the way in which we have met our rental obligations throughout the pandemic has enhanced our reputation as a strong reliable covenant. We are confident that this will assist us greatly in building our pipeline further in 2021.

"We protected our liquidity as a priority over the last nine months through the strong relationships we enjoy with our stakeholders. In April, we completed a sale and leaseback of Clayton Hotel Charlemont in Dublin for €65m (£58.6m) with Deka Immobilien. In July, we increased our debt facilities with our banking club by €39m (£35.2m), while in September, we raised €94.4m (£85.1m) from our shareholders through a share placing. The strength of our balance sheet, the retention of our teams and the quality of our hotel portfolio will give us a significant advantage as international travel recommences in 2021".

Dalata Hotel Group was founded in August 2007. The group's portfolio consists of 29 owned hotels, 12 leased hotels and three management contracts with a total of 9,255 bedrooms. For the first six months of 2020, Dalata reported revenue of €80.8m (£72.8m) and a loss after tax of €63.1m (£56.9m)

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