Dalata has better-than-expected year despite Covid-19 pandemic

Hotel group says outlook for 2021 remains uncertain as vaccines begin to roll out

Dalata, which owns the Maldron and Clayton hotels, said 2021 was uncertain, as it was not clear when international travel would return

Dalata, which owns the Maldron and Clayton hotels, said 2021 was uncertain, as it was not clear when international travel would return

 

Hotel group Dalata said 2020 would be marginally ahead of expectations, despite the ongoing coronavirus pandemic and the difficult trading conditions it had brought.

But the outlook for 2021 remained uncertain, the Maldron and Clayton owners said, with short lead time on bookings and uncertainty over when international travel would return to more normal levels, despite the positive news on vaccines in recent weeks.

The second half of the year was disrupted by Covid-19 restrictions across the UK and Ireland. After the initial lockdown periods ended, hotels in its regional Ireland and regional UK areas benefited from strong staycation demand. Hotels in London and Dublin were quieter, as expected, due to the loss of business from international travel and events. The third quarter of the year saw occupancy of 26 per cent in Dublin, 60 per cent in regional Ireland and 36 per cent in the UK.

Second lockdown

The second lockdown in both Ireland and the UK had less of an impact on business, as most manufacturing and construction services remained open for business, generating some limited demand for hotel rooms.

Occupancy for the fourth quarter is predicted to be 17 per cent in Dublin, 28 per cent in regional Ireland and 21 per cent in the UK, with the reduction in restrictions leading to “encouraging” bookings. Dalata noted a short lead time, however.

Earnings before interest, taxation, depreciation and amortisation (ebitda) for the full year is expected to be marginally ahead of market expectations, with the group focusing on cost control, and availing of Government support schemes.

The group said it remains in a strong financial position, with cash and undrawn debt facilities of €293 million.

Despite the pandemic impact, Dalata is pressing ahead with plans for more hotels, with three new hotels announced this year in Dublin, Brighton and Manchester.

Challenging

Dalata’s deputy chief executive, Dermot Crowley, said the year had been challenging, with the impact on the hospitality industry “acute”.

“However, we remain resilient and united in dealing with the ongoing impact of Covid-19. We note the very positive news surrounding vaccines over the last month and look forward to 2021 with renewed optimism,” he said.

“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 €65 million with Deka Immobilien. In July, we increased our debt facilities with our banking club by €39 million, while in September, we raised €94.4 million 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.”