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Macdonald Hotels has claimed it is in its “best-ever shape” after the company announced it had reduced its bank debts by more than £500m since 2003.
The 55-strong hotel group – with hotels and resorts in the UK, Ireland, Spain and Portugal – posted a profit of £55m in its latest annual trading update for the year ending 31 March 2016.
Macdonald said the profits, which follow the sale of land at the Macdonald Botley Park in Southampton, are supported by a continued strong trading performance.
Group turnover was up 5% to £163.4m, while total operating profit and profit after tax were up 5% to £17.7m and £49.1m to £55.2m, respectively.
Announcing the increase in profits and the continuing debt reduction, which fell to £196m, Gordon Fraser, deputy chairman and managing director, said: “We’re in the best shape ever and are quietly excited about the opportunities for further growth in the next few years.
“It’s been a tremendous combined effort by the workforce and the management team to put in such a strong, sustained performance while at the same time reducing our debts by half a billion pounds in just 13 years. I can’t think of many businesses in our sector which could have done that.”
Like-for-like hotel sales increased by 5% and hotel operating profit grew by 3% on a strong previous year, which was supported by a number of large events.
Fraser cited increases across the company’s commercial, golf, spa and leisure segments results in a 1.5% growth in occupancy and a 2.4% increase in average room rate.
Meanwhile, during the year the group invested a further £13m in its properties, including refurbishing 128 bedrooms at the Macdonald Randolph Hotel in Oxford, the completion of a major refurbishment of the Macdonald Aviemore Highland Resort, as well as a major bedroom refurbishment programme at the Macdonald Bath Spa Hotel in Bath.
Fraser added he envisages “significant benefits” from the Brexit vote, with the weaker pound making Britain an “extremely attractive” place for overseas visitors and encouraging more UK holidaymakers to opt for ‘staycations.
