Dalata Hotel Group shares increased 3.2% to 305p in late afternoon trading on Wednesday, after the company reported a revenue surge to €220.2 million in HY1 2022 against €39.6 million the last year.
The hotel firm announced an adjusted EBITDA of €83.5 million from €1.4 million linked to the reopening of the hotel industry following Covid-19 lockdown restrictions.
Dalata Hotel Group confirmed a pre-tax profit of €52 million compared to a loss of €37.8 million year-on-year, alongside a post-tax profit of €46.7 million from a loss of €30.4 million the year before.
“Irish hotelier Dalata is back in profit amid a recovery in tourism following the pandemic. More impressive was the fact it had comfortably outmatched its pre-pandemic performance back in 2019,” said AJ Bell investment director Russ Mould.
“The concern will be that this is just a short-term respite given rising costs and a cost of living crisis hitting discretionary spend.”
“Dalata is doing what it can over the things it can control, fixing its energy costs for the second half of the year and ensuring its procurement and operating systems are working as efficiently as possible.”
The company noted a basic EPS of 13.1c against a loss per share of 14.5c in HY1 2021.
The group highlighted owned assets of €1.3 billion, with a portfolio of leased assets which historically contributed strong cash flow for reinvestment.
“The first half of 2022 was a period of strong recovery after the lifting of Covid related restrictions at the end of January. The year to date has also been very busy on the development front with the addition of six hotels (1,600 rooms) across four cities. This includes our first exciting step into continental Europe as we entered the lease for Hotel Nikko Düsseldorf. Despite a challenging start to the year, we delivered revenues of €220.2 million for the period, exceeding the levels achieved in the first half of 2019,” said Dalata Hotel Group CEO Dermot Crowley.
“Over the last two years, financial stability has been a key focus for our team. I am especially happy to report that our Balance Sheet has significantly strengthened since the start of the year which ensures we have the capability to exploit opportunities to expand the portfolio further.”
“We continue to explore innovative and new ways in which we operate our hotels for the benefit of all stakeholders and are conscious of the need to mitigate the impact of inflation on our cost base. While technology will play a crucial role in managing costs going forward, the interest rate on our term debt to October 2024 is fixed and 60% of our rent is fixed until 2026, which will support us in the period ahead.”
Dalata Hotel Group did not declare a dividend for the interim financial term.
