Dalata Hotel Group has reported higher revenues and earnings for the six months to the end of June and said it is optimistic for the remainder of the year and its future growth prospects.
Dalata, the country's biggest hotel group, said its half year revenues rose by 29% to €284.8m from €220.2m the same time last year.
Its adjusted EBITDA increased by 24% to €103.4m from €83.5m, but its profit before tax for the six month period dipped 3% to €50.3m from €52m.
Dalata, which operates the Maldron and Clayton hotel brands, has declared an interim dividend of four cent per share, representing a dividend payment of about €8.9m.
It said its average room rate was €139.50 cent - up 10% on the same time in 2022, while its reported occupancy rose to 78.4% from 69.8% the same time last year.
The company has secured two London owned hotels so far this year - one in February and one in July - for €112.3m.
This has added 280 rooms to its UK portfolio and both hotels started trading under Dalata in July, growing its London room portfolio by 64%.
Meanwhile, its Maldron Hotel Shoreditch, London, which has 157 rooms, is due to be completed in the second quarter of next year, bringing its London room portfolio to 876.
Three further leased hotels - with a total of 677 rooms - are also under construction in Liverpool, Brighton, and Manchester, and are expected to open at the end of 2024.
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Looking ahead, Dalata said its like for like Group Revenue per available room (RevPAR) is expected to be €140 for the July/August period, an increase of 5% compared to the same time last year.
Like for like RevPAR in July/August is expected to be 5% ahead of 2022 levels in Dublin, 8% in Regional Ireland and 5% in the UK, it added.
"Recovery of international travel, including resurgent UK Airport traffic statistics and record numbers at Dublin Airport, provides a positive backdrop for the markets in which we operate," the company said.
"While we continue to monitor potential slowdowns in demand as a result of high inflation levels, we are not seeing any such indicators," it added.
Dermot Crowley, Dalata's CEO, said the company's performance year to date has been "exceptional".
"We have continued to expand our asset portfolio with the two recent high-quality acquisitions in London which are both performing well. This speaks to the strength of our balance sheet and our development team's ability to identify and deliver additional rooms in times of market volatility and uncertainty," Mr Crowley said.
"As we open our current pipeline and secure new opportunities, I am confident that we will continue to create further value through the combined strength of our development and operating teams supported by our investment capacity. Our firepower potential provides scope to grow our property assets by €750m in the medium term beyond our currently announced pipeline," he said.
Dermot Crowley also said the company has responded "effectively" to the challenge of rising costs through cost and revenue management initiatives, a focus on reducing utility consumption and adopting innovation across all areas of the business.
"Our ongoing investment in consumer research ensures that customer insights are continuously used to inform and guide decisions, from hotel designs to the food and beverage offerings we serve our customers," he stated.
"As a company, we have taken a reasonable approach to pricing - our average room rate in Dublin during the four-month period from May to August was €177. We remain mindful that the current cost environment is highly dynamic, and our innovation and cost management measures will need to keep pace," he added.
Breaking down its divisions, Dalata said its Dublin region delivered hotel EBITDAR of €68.9m for the six-month period, up 27% from €54.3m the same time last year, which included Covid-19 related government supports of €9m.
The Dublin portfolio consists of eight Maldron hotels, seven Clayton hotels, The Gibson Hotel, The Samuel Hotel and Clayton Hotel Düsseldorf. Ten hotels are owned and eight are operated under leases.
Revenue for the Dublin portfolio came to €149.4m for the six months to June, up 35% on the same time in 2022.
Dalata said the continued normalisation of international trade levels in conjunction with ongoing domestic leisure demand in Dublin resulted in strong hotel performance across the city.
It said that like for like occupancy levels in the second quarter of 2023 was 90.6%, marginally above occupancy levels for the same time last year.
It noted that the average room rate in the second quarter of 2023 was 11% higher than the second quarter of 2022 on a like for like basis, benefiting from events such as the US Presidential visit and the Champions Cup rugby final.
Dalata said that hotel room supply in Dublin continues to be constrained with an estimated 10% of rooms being used for the provision of emergency accommodation for refugees.
The company said its Regional Ireland portfolio performed very strongly, generating hotel EBITDAR of €15.9m in the first half of 2023, an increase of 8% on 2022, which included Covid-19 related government support of €4.7m.
The Regional Ireland hotel portfolio comprises seven Maldron hotels and six Clayton hotels located in Cork (4), Galway (3), Limerick (2), Wexford (2), Portlaoise and Sligo. 12 hotels are owned and one is operated under a lease.
Revenue for the division increased by 23% to €52.6m and Dalata noted that demand from the domestic market remains strong, while an increase in the number of overseas visitors, particularly from North America, has resulted in higher guest volumes.
Occupancy in the second quarter of 2023 was 87.8%, representing 105% of occupancy levels the same time last year.
It said the average room rate of €137.52 in the second quarter of the year reflected a 10% increase on the same time in 2022. It added that a significant number of rooms are still being used for the provision of emergency accommodation for refugees.
Meanwhile, Dalata said its UK portfolio performed very well in the six-month period with EBITDAR growth of 50% to £26.9m.
Its UK hotel portfolio comprises 11 Clayton hotels and five Maldron hotels with two hotels situated in London, 11 hotels in regional UK and three hotels in Northern Ireland.
Six hotels are owned, nine are operated under long-term leases and one hotel is effectively owned through a 99-year lease.
The UK portfolio reported hotel revenue of £72.5m for the six month period, an increase of 29% on the same time in 2022.
The company said that like for like RevPAR growth of 20% for the first six months of 2023 was driven by its London hotels which had been slower to recover from the impact of Covid due to a larger corporate and international travel segment when compared to our Regional UK and Northern Ireland hotels.
It added that like for like RevPAR in the second quarter of 2023 at its London hotels was 123% of equivalent levels in 2022, outperforming in both occupancy and average room rate.
Like for like RevPAR at its Regional UK and Northern Ireland hotels was 112% of the same period in 2022, it added.
Shares in the company moved higher in Dublin trade today.
