The boss of Park Plaza and art-otel today voiced confidence over the European hospitality sector despite international “uncertainties”.
PPHE Hotel Group president and chief executive Boris Ivesha, was speaking as the company reported that first half earnings [EBITDA] fell by 7.4% to £32.5 million.
This was partly due to a “softer performance” in the UK which saw earnings decline by £3.4 million.
Total revenue was up by 9.2% to £111.6 million over the first six months of 2015 and the company saw a 13.8% rise in first half pre-tax profits to £12.1 million.
The building of two new Park Plaza hotels in London are “slightly behind schedule” but are still expected to open in the fourth quarter of the year.
This could mean that full year results could come in behind market expectations.
The company said: “The recent weakening of sterling presents potential opportunities for the UK with increased appeal for visitors from the US and Asia in particular.
“We are confident about the long term appeal of the European hospitality sector and we remain focused on revenue generation and providing exemplary service to our guests.
“The first half of 2016 was a busy period of significant corporate activity for the group, which saw the acquisition of a controlling interest in Arenaturist in Croatia, the successful completion of several long term refinancing agreements, construction financing and the soft opening of Park Plaza Nuremberg.
“We are pleased to report the overall performance was in line with our expectations notwithstanding a softer performance in the UK.”
Ivesha said: “The second half of the year is typically the strongest trading period for the group and the summer season nature of the Croatian operations will further accentuate this trading pattern.
“Notwithstanding some uncertainties in our international markets and our industry, we are confident about the long term appeal of the European hospitality sector as we prepare for our London hotel openings and we were also delighted to return cash to shareholders in the form of a special dividend which was announced in July.
“As we continue to invest in the quality and expansion of our portfolio with a number of renovation projects and new hotel openings, trading for the 2016 financial year remains in line with the board’s previous expectations.
“However, due to slightly delayed hotel openings, for which pre-opening expenses have been incurred without a significant amount of revenue contribution to offset such expenses, the board expects that this timing difference may result in the group’s results being behind market expectations.”
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