Radisson operator reports €42m gain
The CG Hotel group operates the former Great Southern hotels at Dublin, Cork and Shannon airports, with the Dublin and Cork hotels operating under the Radisson Blu brand, while the Shannon hotel is a Park Inn hotel.
The group had bank loans totalling €63m, repayable within one year, that were costing it €60,000 per week in 2011 to service with Bank of Ireland and Ulster Bank.
However, a note attached to the 2012 accounts just lodged with Companies Office confirms that, following discussions with its lenders, revised loan facilities have been split into sub-facilities, with different applicable interest rates and interest terms.
As a result, the group has recorded the new facility at an estimated fair value of €29m, resulting in it booking the €42m gain.
A note states that “this adjustment does not affect the group’s legal obligations to repay the facilities in full in certain circumstances”.
The restructuring of the loans resulted in the group paying €868,855 in interest to service the loans last year, compared to €3.2m in 2011.
The note adds: “CG Hotels will be required to reassess the amount payable on this loan each year to establish whether the then likely pay amounts exceed the current carrying value and to adjust the liability consequently.”
Instead of the group owing €63.1m in one year, it now has €512,500 repayable in one year; €5.9m repayable between one and two years, €13.3m between two and five years and €10m repayable beyond five years.
The group, which includes Mayo businessman Ben Walsh, purchased the three airport hotels from the Dublin Airport Authority for around €75m in 2006.
The Cork Radisson Blu was put up for sale in June at a guide price of €8m.
The restructuring of the group’s facilities coincided with an upturn in the group’s business last year, with operating profits increasing four-fold from €222,660 to €912,058.
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