Dalata moves back into profit as rebound from Covid continues

Hotel chain Dalata has reported an after-tax profit of €46.7 million for the six months to the end of June this year, compared with a loss of €30.4 million for the same period a year ago, as the sector continues to recover from the pandemic.

The group said a faster-than-expected recovery in hotel markets meant revenue per room was now 5 per cent up on pre-Covid levels.

Dalata, which owns the Maldron and Clayton hotel chains, said revenue for the period rose to €220 million, up from €39.6 million in 2021, while noting that bookings were being driven by continued strong leisure demand and “an active events calendar”.

Occupancy stood at just under 70 per cent over the period with an average room rate of €127. Revenue per available room (RevPAR), a key industry measure, jumped to €88.61 from €16.28 at the same time last year.

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Despite the strong numbers, the company warned that the trading environment for hotels remained challenging, with global inflationary cost pressures around food supply, payroll and, in particular, energy.

“Although we have not seen any impact on demand to date, inflationary costs may impact consumer discretionary spending in the future,” it said.

The group also noted that supply in Ireland remains reduced as a result of rooms being utilised for Government-related business, including the provision of emergency accommodation to refugees fleeing the war in Ukraine.

“At present, it is not known when these rooms will return to the market,” Dalata said. The group has committed up to 5 per cent of its rooms in the Republic for use as emergency accommodation until the end of the year.

“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,” chief executive Dermot Crowley said.

“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,” he said.

“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,” he said.