Bombings 'put off UK leisure-seekers, not foreigners'

Leisure group Hilton said today the London bombings had most affected confidence among its UK customers, but failed to deter foreign visitors.

Hilton, which has 16 London hotels at sites including those at Trafalgar Square, Paddington and Park Lane, said it was not surprising that many families questioned whether they wanted to visit the capital after watching UK media coverage of the events.

Finance director Brian Wallace said: “After the terrorist attacks in London, there was an immediate reaction, with cancellations. But bookings looking forward for the rest of the year are pretty much at normal levels.”

It came as Hilton revealed that tough trading at its Ladbrokes betting business was offset by a better performance by its worldwide hotel chain in the first half of its financial year.

Group pre-tax profits before exceptional items increased to £192.1m (€281.7m) in the six months to June 30 against £191.3m (€280.6m) last time.

Ladbrokes suffered from unfavourable results at major sporting events, including Aintree and Epsom, as well as strong comparative figures from last year’s European Football Championships.

The firm recently upped the stakes in the battle for the title of the UK’s biggest bookmaker when it announced it was buying 141 family-run betting shops.

The £76m (€111.5m) deal for the Welsh chain Jack Brown came after rival William Hill seized top spot with the purchase of 624 shops from Stanley Leisure. Ladbrokes now has 2,266 shops in the UK and Ireland.

Trading at Ladbrokes was offset by the group’s worldwide hotels business.

Profits at its UK hotels arm fell by more than a fifth during the first half after a weaker performance by five major hotels.

High levels of occupancy in London in the first half contrasted with more difficult trading elsewhere in the country, with difficulties in the leisure and conference business – particularly at the Birmingham Metropole.

The group said its site at Stansted Airport was hit by competition from a new rival hotel, while refurbishment disrupted its Edinburgh Caledonian hotel. Hilton said UK forward bookings for 2006 now looked more positive.

The company, which has been recovering from a downturn in the travel sector, is in the process of selling a string of hotels to raise between £300m (€439.9m) and £400m (€586.6m) and hopes to return a large part of the proceeds to shareholders.

Hilton said: “The outlook for the group remains strong with Ladbrokes and Hilton both enjoying steady growth.”

David Liston, analyst at Barclays stockbrokers, said the results were at the top end of hopes, adding that the outlook for the second half remained “encouraging”.