23rd Apr 2007 07:01
Hotel Corp (The) PLC23 April 2007 23 April 2007 For Immediate Release The Hotel Corporation plc Preliminary Results for the year ended 31 December 2006 The Hotel Corporation plc, an AIM listed investment company owning 49.9% ofDawnay Shore Hotels plc, announces its preliminary results for 2006. DSHseparately announced its final results for the 52 week period ended 31 December2006 on 4 April 2007. Highlights The Hotel Corporation • Profit, including revaluation gain, of £51.2m • Independent valuation of hotels as at 31 December 2006 translates into net assets per share of 290p at year end (148p at 31 December 2005) • Final dividend of 4.5p, making a total of 7.15p for the year DSH • DSH* like for like hotel EBITDA increases by 2% • Valuation** of £530 million increases the net asset value per ordinary share in DSH to 492p+, a 31% increase since the 2 July 2006 valuation • Valuation uplift increases year on year net asset value per DSH ordinary share by 185% • Significant boost to EBITDA at Hinckley post renovation - ahead by 41% • Operational turn-around increases EBITDA at Cheltenham Park Hotel by 45% • Walton Hall major conversion from timeshare to four star hotel on target for completion in 2007 • Property development programme gains momentum with 140 rooms added and a further 52 to be completed by 30 June 2007 • Major renovation and room additions commenced at The Lygon Arms Hotel • Strategic review, announced last November, progressing well * Excludes Walton Hall which is under redevelopment ** The hotels have been valued as individual assets hence the valuation excludes any portfolio premium + Increase is after allowing for the carried interest that would be payable to the DSH Founder Investors. NAV per share at 31 December 2006, after allowing for the carried interest, is 492p versus 173p in the prior year Barclay Douglas, Chairman of The Hotel Corporation plc, said: "I'm pleased to report on a very satisfactory set of results." Press enquiries The Hotel Corporation 0207 638 9571 Barclay Douglas Shore Capital and Corporate 020 7468 7911 Graham Shore Citigate Dewe Rogerson 0207 638 9571 Margaret George Notes to Editors The Hotel Corporation plc The Hotel Corporation is an AIM listed company which was established as a meansfor investors in publicly quoted companies to gain an interest in Dawnay ShoreHotels plc. It is currently a 49.9% shareholder in DSH. DSH currently owns aportfolio of 20 four star regional hotels in the United Kingdom. It nowoperates under the Paramount brand of distinction and has also created asignature group of hotels. The portfolio includes the world famous The LygonArms Hotel, a Paramount Signature Hotel in the Cotswolds; the prestigiousParamount Carlton Hotel in Edinburgh and the Paramount Oxford Hotel. Paramounthotels offer extensive banqueting, conference and leisure facilities and many ofthem have architectural and historical significance. The Hotel Corporation is an Isle of Man company, with its principal place ofbusiness and registered office in Douglas, Isle of Man. DSH's hotel locations are shown below: CENTRAL ENGLAND Bedrooms No. of Health & Location meeting Leisure rooms 1 Billesley Manor Hotel* 72 10 Y Country 2 Paramount Cheltenham Park Hotel, Cheltenham 152 11 Y Country 3 Paramount Daventry Hotel, Northamptonshire 138 19 Y City 4 Paramount Hinckley Island Hotel, Leicestershire 349 21 Y Country 5 Paramount Oxford Hotel, Oxford 168 25 Y City 6 Paramount Palace Hotel, Buxton 122 7 Y Country 7 Paramount Walton Hall Hotel & Spa 132 9 Y Country 8 The Lygon Arms* 69 4 Y Country NORTHERN ENGLAND 9 Paramount Imperial Hotel, Blackpool 180 15 Y City/Coast 10 Paramount Majestic Hotel, Harrogate 156 8 Y City 11 Paramount Redworth Hall Hotel, County Durham 100 14 Y Country 12 Paramount Shrigley Hall Hotel, Golf & Country Club, 148 11 Y Country Cheshire SCOTLAND 13 Paramount Carlton Hotel, Edinburgh 189 10 Y City 14 Paramount Marine Hotel, Troon 89 4 Y Coast 15 Paramount Stirling Highland Hotel, Stirling 96 6 Y City SOUTHERN ENGLAND 16 Combe Grove Manor* 42 5 Y Country 17 Paramount Basingstoke Country Hotel 100 12 Y City/Country 18 Paramount Imperial Hotel, Torquay 152 8 Y Coast 19 Paramount Old Ship Hotel, Brighton 152 13 N City / Coast WALES 20 Paramount Angel Hotel, Cardiff 102 7 N City Total 2,708 * Paramount Signature Hotel Chairman's statement I am pleased to report on the final figures for the twelve months ended 31December 2006. As the company's principal asset comprises its interest in Dawnay Shore Hotelsplc (DSH), this statement will focus both on the company's own results and thenon those of DSH. The balance sheet of DSH as at 31 December 2006, the profitand loss account and consolidated cash flow statement of DSH for the periodended 31 December 2006 are also provided in this statement. Results of the Company Revenue for the period, including bank interest, was £2.28m (2005: £2.06m) and,following administrative expenses, operating profit amounted to £2.05m (2005:£1.8m). In addition, an investment gain amounting to £49.2m (2005: £9.7m)arising from the measurement of the company's investment in the ordinary sharesof DSH at their fair value has been recognised, in accordance with InternationalFinancial Reporting Standards. Including this investment gain, total profitbefore tax was £51.2m (2005: £11.5m). No tax is payable for the period due tothe zero corporate taxation provisions in the Isle of Man. Basic and dilutedearnings per share were 147.9p (2005: 33.3p) including these investment gains,and 5.9p (2005: 5.3p) without it. The company has valued its shareholding in DSH on the basis of the net assetvalue of DSH as set out in that company's accounts. DSH's accounts include avaluation of its portfolio of 20 hotels of £530 million or £485 millionexcluding Walton Hall, which is under redevelopment. The valuation was carriedout by Colliers Robert Barry, third party independent valuers, as at 31 December2006. This translates into a net asset value per share in the capital of DSH of492p (2005: 173p per share), after allowing for the carried interestattributable to the Founder shares in DSH. This compares with the price of 110pat which the company last acquired shares in DSH in January 2005. Given DSH'shighly leveraged structure at inception (of approximately four times the levelof debt to equity), movements in the valuation of DSH have had a magnifiedeffect on the value of the company's shareholding in DSH. It is worth notingthat following the recent valuation, DSH's debt relative to equity is less thantwo times. Dividend HCP has declared a final dividend of 4.5p per ordinary share (2005: 3.2p),making a total of 7.15p for the year (2005: 5.8p). The ex-div date will be 2ndMay 2007 and the record date 4th May 2007. Payment will be made to shareholderswithin 20 days of the record date. This amount reflects the profits for theyear before investment gains and tax together with the dividend declared by DSHin respect of 2006. Dawnay Shore Hotels plc Review of Operations and Financial Performance DSH owns twenty hotels comprising in excess of 2,700 rooms across the UK.Management focus during 2006 was on maximising returns from all Group hotels andin particular integrating the three Furlong hotels acquired in December 2005,adding new rooms and other property enhancements to the portfolio. Significantattention was dedicated to leveraging value from the renovation and re-launch ofthe Hinckley Island Hotel, redeveloping Walton Hall, as well as progressing thedevelopment of additional bedrooms at a number of other hotels. During the year significant investment was made in the physical hotels as wellas in the Group operating platform. Capital expenditure for the year was inexcess of £23 million, reflecting the substantial real estate upside within theportfolio. The expenditure covered renovation and room additions and also theupgrade and installation of standardised systems across the Group. Theseincluded a uniform front office management system, vital in managing/sellinghotel rooms and tracking guest activity, and a conference and events managementsystem, aimed at achieving maximum penetration of this key segment. In order tosupport these enhanced systems the underlying IT infrastructure is beingupgraded and is due for completion in May 2007. Substantial benefit to roomrevenue was derived from these enhancements during 2006, however the full impactshould be realised during 2007 and 2008. As shown on the attached Consolidated Financial Statements, on a total Groupbasis (including all 20 hotels) DSH's turnover for the 52 week period ended 31December 2006 was £101.2m, generating hotel operating profit of £35.9m(excluding Walton Hall, which is under redevelopment, turnover was £98.5m andhotel operating profit £36.1m). After depreciation, central and other costs,operating profit was £18.7m. Net interest payable was £23.5m and included£18.5m of interest on senior debt and £4m of interest on the deep discountedbonds which are owned by DSH shareholders. No tax is payable and the loss forthe financial period was £3.3m. Following its acquisition in June 2005 Walton Hall has been undergoing a majorredevelopment which will result in the conversion of 132 timeshare units into202 bedrooms. In addition the construction of a large conference centre wascompleted in March 2007. As a result of the scale of the redevelopment thehotel operated at minimal capacity in 2006 and is excluded from the table below. FY 2006 FY 2005 % change (Unaudited) (Unaudited) Turnover £98.5m £98.5m -Hotel Operating Profit* £36.1m £35.3m 2.0%Occupancy 69.4% 70.2% (1.2%)Average Room Rate £72.23 £69.90 3.3%Revenue per Available Room £50.13 £49.08 2.1% * HOP is EBITDA for the individual hotels, excluding head office costs The unaudited 2005 comparatives include pro-forma results for the hotelsacquired during 2005 and therefore differ from the 2005 results in theConsolidated Financial Statements. On a pro-forma, like for like basis (including the Furlong Hotels acquired inDecember 2005 but excluding Walton Hall) turnover was at the same level as theprior year. Room revenue was £1.2m ahead of the prior year reflecting thesuccess of the Group's ARR strategy (see below). This increase was howeveroff-set by a decline in food and beverage revenue as a result of fewer weddingsat Redworth Hotel and Shrigley Hall and the absence of the autumn partypolitical conferences in Blackpool. Weddings booked for 2007 are already wellahead of the 2006 total and there is a substantial pipeline of potentialbookings currently being converted. In addition, the Conservative Party isreturning to Blackpool this autumn and the Paramount Imperial has been selectedas the host hotel. During 2006, room revenue growth was partly driven byleisure demand which, after a slow start, was very strong, boosted by there-launch of the Paramount website. The re-launch has resulted in the websiteentering the top 100 (out of a total of 3,500) visited leisure and accommodationwebsites in the UK (previously ranked 600). The enhanced IT and operating systems have allowed for the introduction of aspecialist revenue management function. Using various tools, including BestAvailable Rate (BAR), this function ensures that revenue levels are optimisedand the upgraded Central Reservations Office (CRO) will deliver greater volumeswith increased efficiencies through the elimination of numerous manualprocesses. During the first two months of 2007, revenue booked through the newCRO is 31% ahead of the same period in the prior year. These upgrades have supported the Group's revenue strategy whose focus is onmaximising average room rate on high occupancy nights which results in greaterprofit conversion than a focus purely on occupancy-led revenue growth. Thisstrategy has assisted in increasing hotel operating profit by 2.0% over theprior year pro-forma result despite flat overall revenues. As anticipated,energy costs for the period were around £800,000 higher than the comparableperiod and without this increase Hotel EBITDA would have risen by 5%.Noteworthy performances around the Group included Cheltenham, where EBITDA wasahead of the prior year by 45% driven by aggressive sales and marketingstrategies, and Hinckley, which was ahead by 41%, benefiting from the impact ofthe renovation. Direct operating costs, including payroll, have been tightly controlledresulting in a £1.3m reduction year on year and leading to profit conversionduring this period of 36.6% (or 37.4% before the increase in energy costs)versus 35.9% in the previous year. A substantial part of this saving wasachieved through purchasing efficiencies, including negotiating improvedsupplier discounts. Interest expense was around £2.6 million greater than the previous year, mainlyreflecting the cost of the debt facility used to acquire the three Furlonghotels (100% debt funded), funds drawn for hotel renovations such as Hinckleyand room additions. Dividends DSH's policy remains to distribute its net surplus cash flow from time to time.DSH is proposing a dividend of 3.8p per share in respect of the 52 week periodended 31 December 2006. Property valuation The DSH hotel portfolio was valued by Colliers Robert Barry at £530.2 million(excluding Walton Hall the value is £484.8 million) as at 31 December 2006. Forthe first time the valuation includes Walton Hall, reflecting the progress madein redeveloping this asset. The 2006 interim valuation by Colliers Robert Barrywas £445 million for the 19 hotels owned by the Group, excluding Walton Hall,hence the latest valuation represents a 9% increase over 2 July 2006. The yearon year revaluation increment shown in the financial statements of approximately£137 million represents a 36% increase over the previous year's book value. Theimpact of the latest valuation is to increase the DSH year on year net assetvalue per share by 185% (after a full provision for the carried interest). Segmenting the portfolio to show the various acquisitions made by the Group, thecurrent valuation represents a per room value as follows: • 20 hotels: £191,000; • 16 hotels excluding Furlong: £184,000; • Original 13 Paramount hotels: £198,000. Property development In line with stated strategy, DSH continues to exploit the development potentialof its property portfolio through room additions. The current room additionsprogramme is summarised as follows1: Hotel Number of rooms Status New Within Total Completed To be commenced Estimated build existing completion structure Cheltenham 9 9 March 2006Walton Hall 70 70 56 - Q4 2006 Remainder Q2 2007Redworth Hall 40 3 43 January 2007Lygon 8 8 April 2007Shrigley Hall 22 4 26 Q3 2007 Q1 2008Carlton 32 32 Q2 2007 Q3 2007Stirling 10 10 Q2 2007 Q3 2007Majestic 11 11 6 - Q1 2007 Remainder April 2007Torquay 19 19 Q2 2007 Q2 2007Daventry 17 17 Q1 2007Brighton 2 2 Q4 2006 April 2007 Hinckley 13 13 9 - Q4 2006 Remainder April 2007 62 198 260 1 It should be noted that in certain instances, the room numbers shown in thistable vary from those reported in September 2006 as enhancements to schemes haveresulted in another 37 rooms being added. The above programme is proceeding as planned and in several cases additionalbedrooms have been identified as certain schemes have been refined. In thecontext of current hotel valuations and given trading conditions, the additionof bedrooms produces a significant uplift in the value of the estate. Wecontinue to focus on realising the programme and further room additions areunder review. We expect the total room count of the twenty hotels to increaseto over 3,700 over the next two years. Walton Hall remains the most significant development project with 56 of theadditional 70 rooms added by the end of 2006 and the 1,300 square metreconference centre completed in early March 2007. The conference centre issignificantly larger than the original plan for an 800 square metre centre. Whenall rooms are completed the total count will be 202 - six more than originallyplanned. Currently, the only significant element of the redevelopmentoutstanding is the renovation and reconfiguration of the Main Manor House andthe Coach House. The final phase of works will be completed in June 2007. Fromthe beginning of March 2007 the 130 fully renovated rooms, which are located inseparate wings in the grounds of the hotel and the newly opened conferencecentre, have been operating as a stand-alone hotel. Trading in the first threeweeks has been strong and in line with expectations. A major renovation of The Lygon Arms is also currently underway to repositionthe hotel as the UK's premier Country House hotel. This includes the additionof 8 new rooms within the existing structure, which opened on 15 April 2007 anda full renovation of other bedrooms and public spaces. Annual General Meeting Notice convening the Annual General Meeting of The Hotel Corporation, to be heldat Burleigh Manor, Peel Road, Douglas, Isle of Man, IM1 5EP on 20 June 2007,will be enclosed with the company's report and accounts to be despatched toshareholders shortly. Included will be resolutions seeking shareholdersapproval of the company's investing strategy as required by AIM and for therepurchase of our own shares. Prospects The Board of The Hotel Corporation plc has noted the prospects of DSH stated byits Board as follows: "Trading in the current year to date has been in line with the prior yearreflecting a competitive market. However, the investment made in the physicalassets and operating platform has led to Paramount's RevPAR performanceexceeding its competitors as evidenced by statistics produced by TRIHospitality. Whilst we expect the market to remain competitive we are lookingfor growth from the second quarter onwards, most notably in locations such asHinckley, Basingstoke and Walton Hall. We continue to focus on generatingbusiness through Paramount's re-launched website and through the new CRO. Valuations continued to increase during 2006. Considerable developmentpotential still remains within the existing portfolio and DSH will continue toexploit these opportunities." Strategic Review On 9 November 2006 DSH appointed N M Rothschild & Sons Limited and Shore Capitalas joint financial advisers to undertake a strategic review of its businessaimed at maximising shareholder value. The directors of DSH have indicated thatthe review has been progressing well and they expect to make an announcementover the coming weeks. Barclay Douglas Chairman 20th April 2007 The Hotel Corporation plc 31st December 2006 Income Statement 2006 2005 £'000 £'000 Continuing Operations Revenue 2,185 1,986Administrative expenses (231) (247) Profit from operations 1,954 1,739 Bank interest receivable 92 73Investment gains - unrealised 49,169 9,702 Profit before tax 51,215 11,514 Taxation - - Profit after tax for the year from continuingoperations 51,215 11,514 Earnings Per Share 2006 2005 Basic and diluted 147.9p 33.3p Dividends 2006 2005 £'000 £'000 Paid 2,025 1,450Proposed 1,558 1,108 The Hotel Corporation plc As at 31st December 2006 Balance Sheet Assets 2006 2005 £'000 £'000 £'000 £'000Non-Current Assets Investments 97,976 48,807 Current Assets Trade and other receivables 10 19Cash and cash equivalents 2,321 2,317 2,331 2,336 Total Assets 100,307 51,143 Equity & Liabilities Capital & Reserves Share Capital 1,731 1,731Share Premium Account 33,300 33,308Retained Earnings 65,252 16,062 100,283 51,101 Current Liabilities Trade and other payables 24 42 Total Equity & Liabilities 100,307 51,143 The Hotel Corporation plc 31st December 2006 Statement of Changes in Equity Share Capital Share Premium Retained Total Account Earnings £'000 £'000 £'000 £'000 Issue of Share Capital 1,731 33,518 - 35,249 Expenses on Issue of Share Capital - (210) - (210) Profit for Period - - 5,998 5,998 Balance at 31st December 2004 1,731 33,308 5,998 41,037 Profit for Year - - 11,514 11,514 Dividend - - (1,450) (1,450) Balance at 31st December 2005 1,731 33,308 16,062 51,101 Profit for Year - - 51,215 51,215 Preliminary Expenses - (8) - (8) Dividend - - (2,025) (2,025) Balance at 31st December 2006 1,731 33,300 65,252 100,283 The Hotel Corporation plc 31st December 2006 Cash Flow Statement 2006 2005 £,000 £'000 Net Cash Outflow From Operating Activities (41) (247) Investing Activities Interest received 92 73Purchase of investments - (1,365)Proceeds received on the maturity of investments 1,986 1,986 Net cash from (used in) investing activities 2,078 694 Financing Activities Preliminary expenses (8) -Dividends paid (2,025) (1,450) Net cash used in financing activities (2,033) (1,450) Net increase/(decrease) in cash and cash equivalents 4 (1,003) Cash and cash equivalents at beginning of year 2,317 3,320 Cash and cash equivalents at end of year 2,321 2,317 Notes to the Financial Statements For the Year Ended 31st December 2006 1. Basis of accounting The financial statements in this announcement have been prepared in accordancewith International Financial Reporting Standards (IFRS). The statements do notconstitute statutory accounts within the meaning of the Isle of Man CompaniesActs 1931 - 2004. The statutory accounts for the period ended 31 December 2006will be finalised on the basis of the financial information presented by thedirectors in this preliminary announcement and will be delivered to theCompanies Registry in the Isle of Man following the Company's Annual GeneralMeeting. 2. Investments Classified as: 2006 2005 £'000 £'000 Fair value through Profit or Loss Investments 81,426 32,257Held to maturity 16,550 16,550 97,976 48,807 Fair value through Profit or Loss Investments 2006 2005 £'000 £'000Unlisted Investments at Fair ValueFair value at start of period 32,257 21,840Additions at cost - 715Increase in fair value 49,169 9,702Fair value at 31st December 81,426 32,257 The unlisted investment shown above represents a holding of 16,550,000 ordinaryshares of £1 par value in Dawnay Shore Hotels plc, which comprises 49.92% of theissued share capital of that company, which is incorporated and registered inthe United Kingdom. Investments in the ordinary shares of Dawnay Shore Hotelsplc ("DSH") held at the balance sheet date are measured at their fair value. In determining the fair value attributable to the ordinary shares in DSH, thedirectors have drawn upon the net asset value of DSH as set out in the financialstatements of that company and have utilised that net asset value for eachordinary share held in DSH by the company, making an appropriate adjustment forthe carried interest attributable to the Founder shares in DSH (as defined inthe Hotel Corporation plc prospectus issued on 9th July 2004). The financialstatements of DSH include a valuation as at 31st December 2006 of the portfolioof hotels that has been provided by an independent professional valuer andprepared in accordance with the rules of RICS. Any resultant gain or loss in the value of the company's equity investment inDSH is recognised in the Income Statement. Investments held to maturity 2006 2005 £'000 £'000Cost and net book valueAt start of period 16,550 15,900Additions - 650Amortisation of discount 1,986 1,986Maturity (1,986) (1,986)At 31st December 16,550 16,550 Investments held to maturity The investments included above represent unlisted investments in unsecured deepdiscount bonds issued by DSH (Finance) plc, a subsidiary of Dawnay Shore Hotelsplc, maturing at nominal value over a period of 5 years. The bonds have acoupon rate of nil percent. The maturity profile of the bonds held at 31st December 2006 is shown below: Maturing Nominal Value 2006 2005 £'000 £'000 Within one year 1,986 1,986One to two years 1,986 1,986Two to three years 17,543 1,986Three to four years - 17,543 Total 21,515 23,501 3. Earnings per Share 2006 2005 Basic and Diluted Earnings per Share 147.9p 33.3p This comprises: Basic and diluted earnings per share from operations and bankinterest 5.9p 5.3p Basic and diluted earnings per share from investment gains 142.0p 28.0p The calculation of basic earnings per share is based on the following data: Earnings 2006 2005 £'000 £'000 Profit from operations 1,954 1,739Bank interest 92 73Investment gains 2,046 1,812 Investment gains 49,169 9,702 Net profit for period 51,215 11,514 Number of Shares 2006 2005 Weighted average number of ordinary shares for the purpose of basic and diluted earnings per share. 34,619,050 34,619,050 There were no convertible instruments in existence as at 31st December 2006 andtherefore diluted earnings per share does not differ from the basic earnings pershare. 4. Notes to the Cash Flow Statement Reconciliation of Profit from Operations to Net Cash from Operating Activities 2006 2005 £'000 £'000 Profit from operations 1,954 1,739 Decrease in receivables 9 (7) Decrease in trade and other payables (18) 7 Amortisation of discount on purchase of investments (1,986) (1,986) Net cash outflow from operating activities (41) (247) Net cash outflows from operating activities includes cash from dividendsreceived of £199,000 5. Events after the Balance Sheet Date On 20th April 2007 the company declared a dividend of 4.5 pence per share. Theex-dividend date will be 2nd May 2007 and a record date of 4th May 2007.Payment will be made to shareholders within 20 days of the record date. 6. Information relating to Dawnay Shore Hotels plc The profit and loss account and consolidated cash flow statement of DSH for theperiod ended 31 December 2006 together with the balance sheet of DSH as at 31December 2006 are provided on the following pages and have been prepared inaccordance with applicable United Kingdom accounting standards. These areextracted from the preliminary results announcement made by DSH on 4th April2007 and should be read in conjunction with the preliminary results of thecompany. Additional Information The following additional information has been supplied to the company by DawnayShore Hotels plc and should be read in conjunction with the preliminary results of the company Dawnay Shore Hotels plcConsolidated Profit and Loss AccountPeriod ended 31 December 2006 Period ended Period ended 31 December 1 January 2006 2006 £'000 £'000 TURNOVER 101,228 89,458Cost of sales (12,166) (10,932) GROSS PROFIT 89,062 78,526Administrative expenses (70,334) (60,214) OPERATING PROFIT 18,728 18,312 (Loss)/profit on sale of fixed assets (2) 127 18,726 18,439Interest receivable and similar income 160 318Interest payable and similar charges (23,622) (20,772) LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (4,736) (2,015)Tax on loss on ordinary activities 1,474 1,554 LOSS FOR THE FINANCIAL PERIOD (3,262) (461)Equity dividend paid (398) - RETAINED LOSS FOR THE FINANCIAL PERIOD (3,660) (461) All of the Group's operations during the period shown above represent continuingoperations. Note The accounting policies used in arriving at these figures are consistent withthose which will be published with the full financial statements. There are nochanges in accounting policies from those used in the prior period. Thefinancial information in this announcement has been prepared under thehistorical cost convention, adjusted for the revaluation of tangible assets inaccordance with the accounting policies set out in the Company's Report andAccounts for the prior period. Such information does not constitute statutoryaccounts within the meaning of section 240 of the Companies Act 1985 for theperiod ended 31 December 2006 and period ended 1 January 2006. The financialinformation for the prior period ended 1 January 2006 is derived from thestatutory accounts for that period which have been delivered to the Registrar ofCompanies. The auditors reported on those accounts; their report was unqualifiedand did not contain a statement under s237(2) or (3) of the Companies Act 1985.The statutory accounts for the period ended 31 December 2006 have been preparedon the basis of the financial information presented by the directors in thispreliminary announcement and will be delivered to the Registrar of Companiesfollowing the company's annual general meeting. Dawnay Shore Hotels plcConsolidated and Company Balance SheetsAs at 31 December 2006 Group Company Group Company As at 31 As at 31 As at As at December December 1 January 1 January 2006 2006 2006 2006 £'000 £'000 £'000 £'000 FIXED ASSETSIntangible assets - goodwill 9,523 - 9,846 -Tangible assets 527,550 - 375,207 -Investments - 105,537 - 105,340 537,073 105,537 385,053 105,340 CURRENT ASSETSStocks 862 - 877 -Debtors 9,995 223,571 7,564 195,419Cash at bank and in hand 2,407 - 6,474 290 13,264 223,571 14,915 195,709 CREDITORS: amounts falling due within one year (22,947) (65,215) (23,373) (48,377) NET CURRENT (LIABILITIES)/ASSETS (9,683) 158,356 (8,458) 147,332 TOTAL ASSETS LESS CURRENT LIABILITIES 527,390 263,893 376,595 252,672 CREDITORS: amounts falling due after more than one (321,389) (218,829) (302,482) (208,133)yearPROVISION FOR LIABILITIES AND CHARGES (8,021) - (9,495) - NET ASSETS 197,980 45,064 64,618 44,539 CAPITAL AND RESERVESCalled up share capital 1,658 1,658 1,658 1,658Share premium account 32,137 32,137 32,137 32,137Revaluation reserve 168,043 - 31,180 -Profit and loss account (3,858) 11,269 (357) 10,744 EQUITY SHAREHOLDERS' FUNDS 197,980 45,064 64,618 44,539 Dawnay Shore Hotels plcConsolidated Statement of Total Recognised Gains andLossesPeriod ended 31 December 2006 31 December 1 January 2006 2006 £'000 £'000 Retained loss for the financial period (3,660) (461)Unrealised surplus on revaluation of properties 137,022 19,874 Total recognised gains and losses relating to the period 133,362 19,413 NOTE OF CONSOLIDATED HISTORICAL COST PROFITS AND LOSSESPeriod ended 31 December 2006 31 December 1 January 2006 2006 £'000 £'000 Reported loss on ordinary activities before taxation (4,736) (2,015)Difference between historical cost depreciation charge and actual 159 54depreciation charge for the year calculated on the revalued amount Historical cost loss on ordinary activities before taxation (4,577) (1,961) Historical cost loss for the year retained after taxation and (3,501) (407)dividends Dawnay Shore Hotels plcConsolidated Cash Flow StatementPeriod ended 31 December 2006 Period Period ended ended 31 December 1 January 2006 2006 £'000 £'000 Net cash inflow from operating activities 24,530 28,051 Returns on investments and servicing of financeInterest received 160 318Interest paid (19,488) (19,436)Interest paid on finance leases (57) (75)Dividends paid (398) - Net cash outflow from returns on investments and (19,783) (19,193)servicing of finance TaxationCorporation tax paid - - Capital expenditurePurchase of tangible fixed assets (23,169) (7,565)Sale of tangible fixed assets 34 1,114 Net cash outflow from capital expenditure and financial investment (23,135) (6,451) AcquisitionsPurchase of hotels - (75,104)Purchase of subsidiary undertakings (197) (16,716)Cash balances less overdraft acquired with hotels and subsidiary - (51)undertakings Net cash outflow from acquisitions (197) (91,871) Net cash outflow before financing (18,585) (89,464) FinancingIssue of share capital - 1,320New term loans raised 17,802 97,325New bonds issued - 1,200New loan note issued 114 3,595Bank loans repaid - (25,389)Bonds repaid (3,091) (3,475)Term loan issue costs - (2,065)Repayment of principal under finance leases (307) (499) Net cash inflow from financing 14,518 72,012 Decrease in cash (4,067) (17,452) This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
SIPP.L