Goodbody Believes Dalata Has The Means To Survive The COVID-19 Crisis
Goodbody Stockbrokers has said that Dalata Hotel Group has enough cash and facilities to survive the COVID-19 crisis, and that the group will end up benefiting from a slowdown in hotel development activity.
Goodbody analyst Paul Ruddy stated that he anticipates that there will be a "slow rebuild" of revenues after COVID-19-related business restrictions end, and predicted that Dalata's full-year earnings before interest, tax, depreciation and amortisation (EBITDA) will drop to €13 million this year before rising to €87 million in 2021.
The Irish Independent quotes Ruddy as saying in a research note, "Many of the reasons we liked Dalata before this crisis persist. It has a significant freehold asset base, a strong management team, scale advantages in its key Dublin market and a compelling growth opportunity in the UK."
He noted that the group's development opportunities will be delayed due to the COVID-19 crisis, but added, "Offsetting this, however, new hotel supply in Ireland will be curbed by this crisis. This will benefit Dalata's revenue recovery."
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