Hotel group returns to profit despite legal row

The luxury Maybourne London hotel group — which is the source of a bitter dispute between Irish developer Paddy McKillen and the billionaire Barclay brothers — last year returned to pre-tax profit.

Figures lodged by Coroin Ltd with the Companies House in London show it recorded a pre-tax profit of £7.7m (€9.8m) after recording a pre-tax loss of £18.5m in 2012 — a positive swing of over £26m.

Coroin oversees the five-star Claridges, the Connaught in Mayfair, and Berkeley at Knightsbridge, and the accounts show a marginal drop in revenues, from £144.6m to £142.5m, in the 12 months to the end of December last, while average room rates grew 1%.

The group increased its operating profit by 6%, from €41.73m to €44.33m. However, bank interest payments totalling €37.4m reduced the profits to €7.7m.

The 2012 pre-tax loss arose chiefly from the group incurring an exceptional charge of £21.7m concerning the extension and exit fees relating to the group’s previous loan facility.

Belfast-born McKillen — who has a 36% share in the group — has to date spent £30m on lawyers’ fees in his dispute with David and Frederick Barclay — who own 64% of the group — in the battle for the hotels.

According to the directors’ report, Coroin delivered ‘robust results’ in 2013 mainly due to a carefully executed business plan.

Guests booking suites at the hotels can expect to pay £3,240 to £4,000 per night. The report states that the revenue per available room decreased by 2%, but strong margins were maintained thanks to a comprehensive purchasing plan, adherence to service and product standards, and efficiency initiatives at head office and across the hotels.

The report states that the group’s projections for 2014 “forecast increased operating profit and cashflows reflecting increased occupancy. The group holds sufficient working capital to meet its trading obligations.”


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