The Courier & Advertiser (Fife Edition)
Hotel group says Covid won’t impact its viability
Company recorded multimillion-pound loss before virus hit
An upmarket hotel group which operates in Dundee and St Andrews said Covid-19 will not threaten the viability of the business despite a multi-millionpound loss last year.
The operator of Malmaison and Hotel du Vin said market conditions last year were the most challenging seen in years.
That was before Covid-19 completely shut down the group’s 35 UK premises in March.
The hotels reopened at the end of last month but government guidelines have reduced capacity.
Malmaison operates a 91-room hotel over six floors in the centre of Dundee, while Hotel du Vin has a recently refurbished 36-room operation at The Scores in St Andrews.
Newly filed accounts for Malmaison Trading Limited show sales for the year ending September 30 2019 dipped to £79.2 million, from £79.8m in 2018.
The group’s pre-tax loss increased from £2.5m in 2018 to £3.7m last year.
In his director’s report, Gustaaf Bakker said: “With the continuing uncertainty around the macroeconomic environment and the challenges facing the UK hospitality industry as a whole... the company has faced headwinds in the markets in which it operates.
“These have affected the top line, with increased hotel and food and beverage competition and also the cost base, with increased labour and input costs.”
Mr Bakker said Covid-19 was expected to have a “significant impact” but the directors remained confident in the long-term future of the marketplace.
“The performance of the business will depend on the duration and severity of the government measures, including any future lockdowns, the state of mind of the public in general and the state of the overall economy as a result,” he added.
“The directors continue to monitor the situation closely and have implemented measures to minimise the impact of this risk but remain confident in the long-term fundamentals of the market the group operates in and do not believe that the outbreak will impact the viability of the business.”
Brexit was also highlighted as a concern within the accounts, in particular the Government’s immigration policy on low skilled labour.
The firm said it had a reliance on workers being granted rights to work in the UK and that such a labour policy would inhibit its recruitment.
“In order to mitigate the risk of labour shortages, the group is working on increasing efficiency, productivity and synergies in deploying workforce within the group,” the report added.