Shares in the country’s largest hotel operator surged by more than 8% on a better-than-expected trading update, stoking hopes of a swift and lasting recovery in the tourism sector.
The Dalata Hotel Group – which owns the Clayton and Maldron chains – said it saw a stronger trading performance in September and October than it had expected, with positive momentum experienced since hotels re-opened in the summer continuing into the latter portion of the year.
The group – which earlier this week announced Dermot Crowley’s formal replacing of Pat McCann as chief executive – said domestic leisure tourism demand at weekends has continued strongly across all its regions, while the decline in staycations – after the resumption of outbound air travel – has been replaced by an uplift in domestic corporate demand.
The group reported occupancy rates of 67%, for the two months, across its regional hotels in Ireland and 60% occupancy in its Dublin hotels, which are particularly reliant on international and business tourism guests. In the North, occupancy rates hit 75% in the period.
The group’s operations in Britain have also benefited, with 72% occupancy reached in Dalata’s London hotels and its regional UK properties being 75% full over the last two months.
Dalata said it expects its adjusted earnings for the third quarter of the year to amount to around €47m. It said its calendar of events for the final two months of the year – in Ireland – is “improving” with enquiries for corporate bookings increasing.
Dalata's share price surged by over 8% on the back of its update, before paring slightly back to close up by just under 7%.
The group has also appointed Conal O’Neill as chief operations officer, following the retirement announcement – in September – of deputy chief executive Stephen McNally. Mr O’Neill has been general manager of the Maldron Hotels chain since 2016.
With the Covid outlook remaining fluid, Dalata said, back in September it said that its near-term outlook was “uncertain” and that it may not return to pre-pandemic levels of trade until 2024.
Dalata has also agreed improved lending conditions, with the maturity of its existing debt facilities extended by 12 months. The nearest maturity date is now the end of September 2023, with other debt repayments being pushed out to late 2025.