Dalata Hotel Group Reports 12% Increase In Revenue In First Half Of 2019
Revenue for the Dalata Hotel Group, which owns the Maldron and Clayton hotel chains, increased by 12% in the first six months of 2019. The group reported revenues of €201.9 million for the six-mont...
Revenue for the Dalata Hotel Group, which owns the Maldron and Clayton hotel chains, increased by 12% in the first six months of 2019.
The group reported revenues of €201.9 million for the six-month period that ended on June 30, and profit before tax of €37.8 million, a 6.7% increase on the previous year.
Revenue growth was greatly driven by increases in the UK, which saw a 22% increase in revenue.
The group's businesses in regional Ireland and Dublin grew by 7.5% and 9.8%, respectively.
Dublin And Regional Ireland
Like for like revenue per available room (RevPAR), however, fell in Dublin by 1.4%, driven by a combination of the 4.5% VAT increase and a reduction in the number of events in the city.
RevPAR at the firm's regional Ireland hotels was also behind last year, primarily due to the more significant impact of the VAT increase on domestic leisure demand than anticipated, the group said.
It added, however, that the number of new hotels and extensions in Dublin are "performing very well", and that its outlook for the rest of the year remains positive.
Pat McCann, Dalata Group CEO, said that the group has demonstrated its excellent operating performance and ability to control costs despite opening six new hotels and four hotel extensions in the past 18 months.
"This is an example of the intensity and commitment I often speak of in Dalata, where we continue to drive performance of our existing portfolio while building our future pipeline of hotels," McCann said. "Our hotels in all regions are performing well and I am particularly happy with the performance of our UK hotels, given our exciting growth plans for the region."
Dalata reported a strong RevPAR performance in the UK, where it significantly outperformed the market in four of the six cities in which it operates - Manchester, Birmingham, Leeds and Belfast.
"Dalata remains very ambitious and will continue to grow in 2019 and beyond," McCann continued. "Our pipeline of circa 2,400 rooms will open at various stages from 2020 to 2022. Our UK growth strategy continues at pace."
McCann also revealed that the group has acquired a new site with planning approval for a new hotel in Shoreditch, London, for £32 million.
The hotel, which will be London's first Maldron hotel, will have between 130 to 140 rooms, and is expected to open in early 2022.
The total cost of developing the hotel, including the acquisition of the site, will be approximately £60 million, McCann said.
"The strong performance of our Clayton Hotel City of London, which opened in January 2019, reinforces our belief that there is great value in owning and operating a hotel in the centre of the city, " McCann stated. "Our existing hotel portfolio is generating very strong cash flows, and this allows us to take advantage of such great opportunities while keeping our gearing at very comfortable levels."
In spite of all the challenges facing the company in the UK and Ireland, McCann said that the group is still positive about the year after its strong start.
He explained, "Despite the challenges of a significant increase in the VAT rate in Ireland and the ongoing uncertainty surrounding the timing and nature of Brexit, 2019 to date, as a whole, has been another very successful year
"The outlook for the balance of the year looks very positive. We are currently looking at a number of exciting opportunities in the UK and Ireland, and we expect to announce further additions before the end of the year."
© 2019 Hospitality Ireland – your source for the latest industry news. Article by Aidan O'Sullivan. Click subscribe to sign up for the Hospitality Ireland print edition.