Dalata, the Irish hotel group behind the Maldron and Clayton brands, expects room revenue growth to slow this year despite strong bookings across its portfolio throughout November and December.
In a trading update on Wednesday morning the Dublin-listed group said it anticipates full-year adjusted earnings (Ebitda) to exceed €232 million, ahead of analyst expectations, in its current financial year, representing a 4 per cent increase on last year.
“We are on track to deliver another strong financial performance, headlined by another year of growth in both our revenue and adjusted Ebitda performance,” said Dalata chief executive Dermot Crowley in a statement.
Ireland’s biggest hotel group suffered a slow start to the year, with revenue per available room (RevPar) – a key profitability metric in the hotel industry – dropping 11 per cent in the early months of 2024.
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Despite a pickup in business levels throughout the summer, the group said in half-year results published in September that RevPar grew by just 1 per cent in the six months to the end of June to €110.77.
Now Dalata, which publishes full-year results in February, is forecasting RevPar growth of 1 per cent for the whole of 2024, down from 11 per cent in 2023.
Looking ahead the group anticipates that recent changes to the UK national insurance scheme combined with increasing minimum wage rates in Ireland will increase its payroll costs by 5 per cent next year.
Dalata said it “continues to respond proactively to cost pressures and is confident it will cover these additional costs with the benefit of a €2 million reduction in contracted energy pricing, the ongoing roll-out of further efficiency and innovation initiatives and through RevPar growth in our markets.”
The group is also set to benefit from the “full-year impact” of four new UK hotels it opened in 2024 and the addition of the Radisson Blu Dublin Airport, for which it awaits clearance from the Irish competition watchdog.
Mr Crowley said the pausing of the Dublin Airport passenger cap for next summer will also support revenue growth.
“Looking forward I am pleased that the cap will not apply in the summer of 2025, and we are hopeful that it will be removed fully in time,” he said. “It is expected that passenger numbers at Dublin Airport will grow by 4 per cent in 2025, with increased access from North America, which will be very positive for hotels across the whole of Ireland.”
He said the group remains focused on its goal of increasing its footprint to 21,000 rooms by 2030 from 12,150 currently.
Dalata’s share price in Dublin increased by around 2 per cent to €4.45 per share in early trading following the update.
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