RNS Number:6270K
Gresham Hotel Group Plc
26 September 2001
GRESHAM HOTEL GROUP PLC
PRELIMINARY RESULTS
26 WEEKS ENDED 26 JULY 2001
Financial Highlights
Profit & Loss
* Turnover up 4% to Euro27.5m from Euro26.3m last year.
* Operating profit before exceptional items down Euro1.9m to
Euro4.1m.
* Cash profit of Euro14m realised from sale of Royal Marine
Hotel.
* Exceptional items comprise:
Costs fees arising on sale & leaseback of hotel property Euro 956,000
Branding costs Euro 662,000
Non-cash revaluation adjustment Euro 5,975,000
* Interim dividend maintained at Euro0.012570 per share.
* Interest cover of 1.63 times.
Balance Sheet
* Fixed assets revalued producing an uplift of Euro13m. Fixed assets now
stand at Euro211m.
* Net assets increased to Euro137m, producing a net asset value per share
of Euro1.78.
* Bank borrowings at Euro44m producing a bank gearing ratio of 32%.
CHAIRMAN'S STATEMENT
INTERIM RESULTS FOR THE 26 WEEKS ENDED 26 JULY 2001
Dear Shareholder,
The period to the 26 July 2001 was an extremely difficult one for the whole
tourism sector in Ireland. In February the Government introduced travel
restrictions following the outbreak of Foot & Mouth Disease in the U.K. and
Ireland. While, thankfully, the disease was well contained in Ireland it
remained a problem in the U.K. for the entire period and, indeed, continues to
be an issue. The effects of the travel restrictions were felt acutely in our
West Coast division but the impact on our centre city locations, in terms of
diminished corporate travel and the cancellation of numerous business and
sporting events, was also significant. As a result, the operating profit
before exceptional items was reduced from Euro5.966m to Euro4.056m. Profit
before exceptional items fell from Euro4.056m to Euro1.570m.
The directors have decided to maintain the interim dividend at last year's
level of 1.257 cents.
During the period under review, the Group launched its new branding initiative
and is now operating two brands, Gresham Hotels which is concentrating on the
4 star city corporate and leisure markets and Ryan Hotels which is
concentrating on the leisure market in the West of Ireland. The costs of
branding have been taken into account in these interim results and we believe
that substantial benefits will accrue to the Group in the future.
As reported earlier, the Group sold and leased back the Royal Marine Hotel
thereby releasing Euro22.2m in cash which has been used to reduce debt. The
Group is now in a strong financial position with bank gearing standing at 32%.
Following our undertaking last year, a complete revaluation of all our
properties was carried out during the period, which resulted in our property
values increasing by Euro13m. The movements in value, both positive and
negative, have been reflected in reserves, with the exception of the Carat
downward adjustment which is reflected in the Profit & Loss Account. The net
asset value per share now stands at Euro1.78.
At the end of August the Group issued a Trading Update which brought
shareholders up-to-date with the trading position for the first half of the
year. At that time it was anticipated that the second half of the year would
not be as adversely effected by Foot & Mouth and other considerations as the
first half had been. The human tragedy which occurred in the United States on
the 11 September was devastating and will impact severely on the travel and
tourism sector worldwide. Your Group cannot be insulated from these effects.
At the time of writing this statement, it is not possible to fully assess the
depth and the duration of the reduction in travel and other tourism
activities.
However, following the completion of the Royal Marine Hotel transaction the
Group is in a very satisfactory cash position and management are now engaged
in a complete review of all areas of Group activity in the context of a likely
change in market conditions.
Sean Henneberry
Chairman
26 September 2001
The Interim Results (unaudited) of Gresham Hotel Group plc for the twenty six
weeks to 26 July 2001 are as follows:
GROUP PROFIT & LOSS ACCOUNT
FOR THE TWENTY SIX WEEKS TO 26 JULY 2001
2001 2000
Notes Euro000's Euro000's
Turnover 27,454 26,277
Operating profit before exceptional costs 4,056 5,966
Exceptional costs:
Branding costs 3 (662) -
Revaluation adjustment on Carat Hotel 3 (5,975)
Operating (loss) / profit after exceptional costs (2,581) 5,966
Costs arising on Sale & Leaseback of 3 (956) -
Royal Marine Hotel
(Loss) / Profit before finance costs and taxation (3,537) 5,966
Finance cost (2,486) (1,910)
(Loss) / Profit before taxation (6,023) 4,056
Taxation (236) (527)
(Loss) / Profit after taxation (6,259) 3,529
Dividends (976) (966)
(Loss) / Profit retained for the period (7,235) 2,563
Profit realised from revaluation reserve 4 14,836 -
Scrip issues in lieu of cash dividends 526 1,011
Retained profits at beginning of period 32,519 26,480
RETAINED PROFITS AT END OF PERIOD 40,646 30,054
Earnings per share - before exceptional items Euro0.0174 Euro0.0470
Earnings per share - after exceptional items (Euro0.0823) Euro0.0470
Diluted earnings per share (Euro0.0813) Euro0.0463
GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE TWENTY SIX WEEKS TO 26 JULY 2001
2001 2000
Notes Euro000's Euro000's
(Loss) / Profit after taxation and exceptional items (6,259) 3,529
Unrealised surplus on revaluation of hotel properties 18,961 -
Foreign currency profit / (loss)
on net assets in overseas subsidiaries 1,044 (579)
Foreign currency (loss) / profit
on foreign currency borrowings (959) 511
Total Recognised Gains and Losses for the period 12,787 3,461
GROUP BALANCE SHEET
AS AT 26 JULY 2001
2001 2000
Notes Euro000's Euro000's
FIXED ASSETS 211,271 215,990
Tangible assets
CURRENT ASSETS 1,275 1,215
Stocks
Debtors 7,174 8,511
Cash at bank 28,948 7,795
CREDITORS (22,278) (21,058)
(amounts falling due within one year)
NET CURRENT ASSETS / (LIABILITIES) 15,119 (3,537)
TOTAL ASSETS LESS 226,390 212,453
CURRENT LIABILITIES
CREDITORS
(amounts falling due after more than one year) (89,731) (90,376)
TOTAL NET ASSETS 136,659 122,077
CAPITAL AND RESERVES 5 8,092 5,018
Called up share capital
Share premium account 10,356 13,485
Revaluation reserve 6 74,214 70,089
Other reserves 3,351 3,431
Profit and loss account 40,646 30,054
SHAREHOLDERS' FUNDS 136,659 122,077
(Equity and Non-Equity)
Net Asset Value per Share Euro1.78 Euro1.63
GROUP CASH FLOW STATEMENT
FOR THE TWENTY SIX WEEKS TO 26 JULY 2001
2001 2000
Euro000's Euro000's
NET CASH INFLOW FROM 3,586 6,260
OPERATING ACTIVITIES
RETURNS ON INVESTMENTS &
SERVICING OF FINANCE
Interest received 374 315
Interest paid (2,410) (1,734)
Interest element of finance lease payments (336) (344)
Participating preference dividends (21) (17)
Net Cash Outflow from Returns on (2,393) (1,780)
Investments and Servicing of Finance
TAXATION
Net Cash Flow from Taxation (270) 44
CAPITAL EXPENDITURE
Payments to acquire tangible assets (1,826) (5,399)
Net Cash Outflow from Capital Expenditure (1,826) (5,399)
ACQUISITIONS & DISPOSALS
Proceeds from disposal of Royal Marine Hotel 22,220 -
Payment of disposal costs (282) -
Net Cash Inflow from Acquisitions & Disposals 21,938 -
EQUITY DIVIDENDS PAID (1,746) (1,018)
Net Cash Inflow / (Outflow) before Financing 19,289 (1,893)
FINANCING
Issue of ordinary share capital 13 25
Share issue costs (54) (30)
New loans during period 2,538 3,661
Repayment of long term loans (3,767) (871)
Capital element of finance lease payments (109) (66)
Net Cash (Outflow) / Inflow from Financing (1,379) 2,719
INCREASE IN CASH 17,910 826
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE 26 WEEKS ENDED 26 JULY 2001
1. Interim Dividend
Euro0.012570 per Ordinary share payable on 30 November 2001 to
Shareholders on the Register on 5 October 2001.
2. Interim Report
The Interim Report is being sent to all Shareholders. It is also available
to the public at the Company's Registered Office, 23 Upper O'Connell
Street, Dublin 1.
3. Exceptional Items
The revaluation adjustment below reflects the movement in carrying value
of the Carat Hotel, Hamburg. The decrease in value amounts to Euro
6,405,000. Euro430,000 has been written off against previous revaluation
surpluses on the Carat Hotel and the balance of Euro5,975,000 has been
charged to the profit and loss account. Other revaluation pluses and
minuses have been taken to revaluation reserves. The net increase in
value, after allowing for the Carat Hotel adjustment, amounts to Euro
12,986,000.
Non-
Cash Cash Total Total
2001 2001 2001 2000
Euro000's Euro'000's Euro'000's Euro'000's
Costs arising on sale & leaseback of
Royal Marine Hotel (956) - (956) -
Branding costs (662) - (662) -
Revaluation adjustment - (5,975) (5,975) -
(1,618) (5,975) (7,593) -
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE 26 WEEKS ENDED 26 JULY 2001
4. Significant Items - Sale & Leaseback of Royal Marine Hotel Euro000's
Sale proceeds 22,220
Historical cost - 1985 (1,441)
Subsequent additions (5,943)
Realised revaluation surplus 14,836
5. Share Capital Euro000's
Authorised:
Equity:
120,000,000 Ordinary shares of Euro0.10 each 12,000
Non-Equity:
4,200,000 Participating Preference shares of Euro0.10 each 420
30,000,000 Preference shares of Euro1 each 30,000
42,420
Allotted and fully paid:
Equity:
76,076,793 Ordinary shares at beginning of period 4,830
30,000 Share options exercised 2
605,811 Scrip issues in lieu of cash dividends 61
Increase in par value per share 2,779
76,712,604 Ordinary shares at end of period 7,672
Non-Equity:
4,200,000 Participating Preference shares at beginning of period 267
Increase in par value per share 153
4,200,000 Participating Preference shares at end of period 420
8,092
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE 26 WEEKS ENDED 26 JULY 2001
6. Revaluation Reserve Euro000's
Balance at beginning of period 70,089
Realised revaluation surplus on sale & leaseback of (14,836)
Royal Marine Hotel
Surplus on revaluation of hotel properties 19,391
Deficit in respect of Carat Hotel, Hamburg (430)
Balance at end of period 74,214
For further information contact:
Patrick Coyle Chief Executive Gresham Hotel Group Plc +353 1 817 6209
Robert Bastow Finance Director Gresham Hotel Group Plc +353 1 817 6209
Fiona Gillespie Communications Consultant +353 87 250 2447
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