Dalata Hotel Group expects a double-digit drop in quarterly revenue as its business is “severely impacted” by the spread of the coronavirus.
The Irish hotel operator told investors that restrictions on movement and travel will mean its revenue for the quarter ending March 2020 will be 16% lower than a year earlier.
It will cancel its dividend, cut pay for the board, close several of its hotels and said it has laid off “a large number of employees for whom we currently have no work”.
Dalata said it has “significant financial headroom”, with cash resources of €80m and undrawn committed debt facilities of €65m.
“The group has already implemented several measures to mitigate the financial consequences of the impact of Covid-19 and to maintain the group’s strong liquidity,” the company said.
“Postponement of uncommitted development capital expenditure and non-essential maintenance capital expenditure for this year will free up additional cash resources of approximately €60m. Total capital expenditure for the remainder of the year will be up to a maximum of €35m. This could reduce further if development projects are delayed due to the impact of restrictions surrounding the Covid-19 outbreak.”
Of the employees temporarily let go, the company said: “These staff members remain part of the Dalata team and the group looks forward to welcoming them back to work as soon as our business recovers.”
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