Earnings at hotel group expected to rise by 40%

The CEO of the country’s largest hotel group said yesterday he expects earnings at the group to increase by 40% on the €2m recorded last year.

The Dalata Hotel Group is led by Pat McCann. It operates 4,700 hotel rooms.

The group recorded earnings before interest, tax, depreciation and amortisation (EBITDA) last year of €2m — up from the €800,000 in 2010. Mr McCann said: “It was a much improved performance last year. We had a low point in 2009 and we have continued to make progress since. Last year was a decent performance in a tough environment.”

The group has grown rapidly during the recession taking on management contracts for troubled businesses such as Dublin’s Citywest Hotel, the Heritage Golf and Spa Report in Portlaoise and Whites of Wexford.

Mr McCann said between leased and managed properties the group employs 2,500 people. He said that the 40% growth in EBITDA in the business anticipated this year arises from improved performance in Dublin hotels and the group operating more managed properties.

“There is good growth this year, but we are cautious. There are still issues around consumer demand. We are performing well, but there is still a long way to go.”

Mr McCann was commenting on accounts just filed to the Companies Office that show Dalata increased its revenues from €29.1m to €29.6m in the 12 months to the end of December last.

The figures show the group recorded a profit of €6.4m But, the profit arose from an exceptional gain of €8.3m related mainly to the gain on the €7.9m sale of discontinued operations to Dalata.

The group’s operating losses reduced by 45% from €1.95m to €1m last year. Interest payments of €803,000 added to the losses and a tax credit resulted in a loss of €1.82m before the exceptional gain is taken into account.

Numbers directly employed by the group last year declined from 377 to 348 with payroll costs reducing from €10.6m to €9.5m.