Dalata Experienced Strong Growth In H1 2018
Dalata Hotel Group has announced its results for the six months to June 30, 2018, revealing that it experienced strong revenue growth of 10.6% to €180.6 million during the period. Dalata's revenue...
Dalata Hotel Group has announced its results for the six months to June 30, 2018, revealing that it experienced strong revenue growth of 10.6% to €180.6 million during the period.
Dalata's revenue per available room (RevPAR) during the first half of the year was up 7.1% to €89.39 while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) grew 12% to €50.3 million and adjusted diluted EPS rose 14.7% to 17.2 cent.
Dalata expects to have added a total of 1,500 new rooms to its portfolio throughout 2018, having already opened the Maldron Hotel Belfast City in March 2018 and Maldron Hotel Kevin Street, Dublin in July 2018 as well as completing and opening extensions at Clayton Hotel Dublin Airport, Maldron Hotel Sandy Road, Galway and Clayton Hotel Ballsbridge, Dublin.
The 212-bedroom Clayton Hotel Aldgate, London, is scheduled to open in December 2018, with a further three new hotels and one extension totalling 670 rooms on target to open in Dublin, Cork and Newcastle in the fourth quarter of the year, delivering a total of 250 new jobs across the three cities.
Dalata invested €10.8 million in capital refurbishment across all areas of its hotels, with 823 rooms refurbished, in the first half of 2018 and the group has reached an agreement, subject to Board approval, to extend the Ballsbridge Hotel lease in Dublin until March 2020.
Demolition of the Tara Towers Hotel will commence in the final quarter of this year to make way for a new 140-bedroom hotel branded Maldron Hotel Merrion Road, 69 residential units and an underground car park.
Dalata has added an additional 1,070 rooms added to pipeline in 2018 in London, Birmingham, Bristol and Manchester, with an agreement having been signed with CEPF II, a fund administered by Catalyst Capital, to lease a new four-star Maldron Hotel in the latter city. The construction of the 276-bedroom hotel is subject to the receipt of planning permission from Manchester City Council and, if approved, it is expected that the hotel will open in the first half of 2021.
With continued expansion across its regions and strong market dynamics, Dalata asserts it feels positive about its current outlook.
The group said that the performance of its Dublin hotels was robust in July and August, while occupancy levels in the second half of 2017 were very high, impacting Dalata's ability to grow RevPAR at the same pace in the second half of 2018 as that achieved in the first half of 2018.
The group's trading in regional Ireland has been marginally ahead of last year in July and August and Dalata remains positive about the opportunity presented by the fragmented nature of the hotel market in its target UK regional cities.
Trading across Dalata's UK hotels has been mixed but broadly in line with group expectations given the challenging market conditions in some cities. The balance of the year should be broadly similar to performance levels in the year to date.
As it continues to explore opportunities in the UK and Irish hotel markets, Dalata said it remains very confident that it can further build an attractive pipeline of rooms.
Dalata added that the reduction in the VAT rate has been hugely positive for the hotel industry as a whole. However, should the rate increase in Ireland from 9% to 13.5%, the group estimates this could reduce its revenues by up to 2.0% for a full trading year.
© 2018 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.