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Dalata increases financial strength as it reopens hotels

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Ireland’s largest hotel group, Dalata, has secured additional financial strength with an amendment to its existing debt facilities.

Its revolving credit facility has been increased by €39m to €364m until September 2022.

In addition, the conditions of the loan comprising of net debt to earnings before interest, taxation, depreciation and amortisation (EBITDA) and interest cover will not be tested again until June 2022.

These two conditions have been replaced, until that date, by a net debt to value covenant and a minimum liquidity test, whereby the company must have a minimum of €50m available to it in cash and/or an unutilised amount of the revolving credit facility.

It comes as the company beings to re-open its hotels.

In a statement today Dalata said it continues to have significant financial headroom.

At the end of June it had cash resources of €103m and further undrawn committed debt facilities of €72m.

The undrawn committed debt facilities have increased to €111m as a result of the increase in the revolving credit facility.

During this quarter Dalata, whose hotels include the Clayton and Maldron chains, said its cash utilisation was better than initial expectations due to good cost control and working capital management, utilisation of Governments' support initiatives and the postponement of uncommitted capital expenditure.

The company has now reopened 42 of its hotels in the Republic of Ireland, Northern Ireland and England to the public.

Dermot Crowley, deputy CEO business development & finance said: "We are pleased to have secured amended facilities from our banking group as we reopen for business.

Our new covenants will support Dalata as we navigate through these difficult and uncertain times and enhance our strong liquidity position.”

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