Wednesday 21 March 2018

Newsmaker - Pat McCann

Pat McCann
Pat McCann

Pat McCann

With the Irish property market experiencing a rebirth, there's money to be made - and Dalata is cashing in. Revenue in the first half of the year almost trebled to €97.7m compared to €34.9m the year before, while profits shot up from €900,000 to €2.7m.

The company has gone on an acquisition spree over the last year or so, which included splashing out €452.3m to buy nine Moran Bewleys properties.

Chief executive Pat McCann has now given as clear a signal of intent as any that the firm, which is the largest hotel operator in the country, shows no signs of slowing down with the announcement that it intends to raise €160m in equity.

McCann has even shown an interest in developing new hotels in Dublin with the company's war chest. In short, expect him to continue motoring down the acquisition trail.

The announcements mark a remarkable turnaround for Dalata, which, unsurprisingly, given its sector, struggled mightily after the Celtic Tiger bubble burst.

To put it mildly, Mr McCann, who has over 45 years of experience in the hotel industry, picked an inopportune time - 2007 - to launch.

Prior to starting Dalata he embarked upon his career in the industry in 1969 with Ryan Hotels, before joining Jurys hotels two decades later. In 2000 he became chief executive of the company, then Jurys Doyle, until he left in 2006.

Afterwards, McCann staked €1m of his own cash on Dalata and more than 80 private clients of Davy Stockbrokers stumped up a further €20.5m.

The Shane Reihill-headed investment group TVC also invested €10m in the project, while €15m in borrowings were added to the kitty. Using that money they paid €46.5m to buy ten hotel properties from developer Paddy Kelly.

By 2012, it was expected that the Maldron business would have grown its earnings before deductions from €2.5m in 2007 to €11.5m. Things didn't go to plan and, by 2009, operating losses were €35.5m after it shouldered a non-cash goodwill impairment of €35.2m, with McCann remarking in 2011 that the three years prior had been "the most challenging of my career".

However, the company managed to battle its way through the recession years and by the end of 2014 turnover had grown by 30pc year-on-year to €79m while earnings before deductions jumped by 54pc to €8.2m.

The business floated on the Dublin and London Stock Exchanges in March of 2014, raising €265m, and launched on an acquisition spree over the next 12 months.

Coming towards to the end of 2015 Mr McCann now looks to have gotten Dalata in as strong a position as ever.

Irish Independent

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