A REFINANCING deal in July has cut £15 million (€16.3 million) off the annual interest bill of the Jurys Inn group, according to its latest figures.
Vesway, the owner of the chain, which has hotels in Ireland and Britain, paid £41.6 million in interest last year, according to its most recent accounts. The payment left it with a pretax loss of £21.5 million.
The company’s operations were profitable, earning a surplus of £20.4 million in 2008, a near 30 per cent increase on the £15.7 million it returned for the final seven months of 2007.
Directors Cormac Ó Tighearnaigh and Olan Cremin state in their report that in July, the company raised an additional £30 million from its existing lenders.
“The company raised additional debt of £30 million and renegotiated the repayment date for all existing debt facilities from 2012 to 2014,” the report says.
As a result, it was able to enter new interest-rate agreements at current rates. The directors estimate this will cut £15 million from the group’s interest bill in 2010.
The £32 million cost of the deal will be reflected in this year’s accounts. At the end of last year, the group owed its banks £600 million. The debt was repayable over periods longer than one year.
Vesway was set up after Quinlan Private bought the Inns business from its then parent Jurys Doyle, midway through 2007 for €1.165 billion.
The Oman Investment Fund, a sovereign fund based in the sultanate of Oman, subsequently bought 50 per cent of Vesway.
The accounts, just filed with the Companies Registration Office, show it had revenues of £132.8 million in 2008, its first full year of trading following the acquisition.
Chairwoman Barbara Cassani says in her statement that revenues were up 10 per cent on the comparable figure for 2007. She says earnings before interest, tax and write-offs were £43.2 million.
The group’s balance sheet shows that shareholders’ funds at the end of last year were £470 million, compared with £100 million 12 months previously.
The company reports its figures in sterling to reflect the fact that it does much of its business in Britain.
Ms Cassani’s statement says trading conditions deteriorated in the second half of 2008 as consumers and companies cut back.
“In the year we began a new phase of expansion with a successful opening in Liverpool which made a positive contribution to overall performance,” she says.
“We have accelerated the pace of our expansion in 2009 and, despite an uncertain market, will open eight hotels and 1,500 rooms. On top of that we have already secured a pipeline of four new hotels in 2010. This growth will see the company grow from 24 in 2007 to 34 hotels by the end of 2010.”
