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Dalata Agrees Extended Debt Facilities, Appoints Mr Conal O’Neill

Wednesday, November 03, 2021.
Dalata Hotel Group plc Agrees Extended Debt Facilities, Appoints Mr Conal O’Neill

Dalata Hotel Group plc Agrees Extended Debt Facilities 

Positive Momentum Continues with Encouraging Outlook for Remainder of 2021 
Mr Conal O’Neill appointed Chief Operations Officer effective 1 January 2022 

Dalata Hotel Group plc (“Dalata” or the “Group”), the largest  hotel operator in Ireland with a growing presence in the United Kingdom, is pleased to announce it  has successfully agreed the extension of the Group’s Debt Facilities (the “Revised Facilities”) with its  banking partners, demonstrating the strength of the Group’s financial position. In addition to  extending the maturity of the Debt Facilities, the Revised Facilities agreement also provides additional  flexibility as the business recovers from the impact of the Covid-19 pandemic. 

Extended Debt Facilities 

The Group has availed of its option to extend the maturity of its Debt Facilities by 12 months. The  Group’s Debt Facilities now consist of a €200 million term loan facility, with a maturity date of 26  October 2025 and a €364.4 million revolving credit facility (“RCF”): €304.9 million with a maturity date  of 26 October 2025 and €59.5 million with a maturity date of 30 September 2023. 

The Group announced in July 2020 that previous covenants comprising Net Debt to EBITDA and  Interest Cover would not be tested again until June 2022 (“the Previous Covenants”). These two  covenants were replaced, until that date, by a Net Debt to Value covenant and a minimum liquidity  test, whereby the Group must have a minimum of €50 million available to it in cash and/or an  unutilised amount of the RCF. 

Under the Revised Facilities agreement announced today, the Previous Covenants will now not be  tested until June 2023. The Net Debt to Value covenant and the minimum liquidity test will remain in  place until that date. 

At 29 October 2021, the Group has cash and undrawn facilities of €303 million.  

Update on Trading 

The positive momentum since hotels re-opened has continued. Trading has been stronger than  expected in September and October with the Group’s hotels achieving occupancies for the two-month  period of 60% in Dublin, 67% in Regional Ireland, 72% in London and 75% in Regional UK and Northern  Ireland. The decrease in staycations following the summer period is being replaced by an uplift in  demand from domestic corporates and project work. Domestic leisure demand at weekends continues  to be strong across all regions. There has also been an uplift from the resumption of international  visitors coming to Ireland. 

The Group continues to proactively manage costs as trade recovers and utilise available Government  supports to protect employment. Adjusted EBITDA for July to October is expected to be approximately  €47 million. 

In Ireland, Covid-19 restrictions on trade were further relaxed on 22 October although the full lifting  of restrictions has been delayed by the Government in line with public health advice. The calendar of  events for the final two months of the year in Ireland is improving and we are seeing increased  enquiries at our hotels.  

Appointment of Chief Operations Officer 

Dalata also announces the appointment of Mr Conal O’Neill as Chief Operations Officer (“COO”) effective 1 January 2022. This follows the announcement on 1 September 2021 that Stephen McNally,  Deputy Chief Executive Officer is to retire. 

Mr O’Neill joined the Group in 2014 as Group Operations Manager before taking on the role of Group  General Manager for Maldron Hotels in 2016. He has played a leading role in the operations team and  has overseen the development of the Maldron brand during a period of significant growth and  expansion. He has extensive operational experience handling the launch of new build hotels as well  as the integration of new acquisition assets. More recently, he has also been heavily involved in  developing the Group’s ESG strategy. Prior to joining Dalata, Mr O’Neill headed up the Hotels Team at  Ion Equity and before that spent 15 years with Jurys Doyle Hotel Group plc in both Ireland and the UK.  He is a Fellow of the Irish Hospitality Institute and a graduate of Galway-Mayo Institute of Technology.  

Dermot Crowley, Dalata Hotel Group CEO, commented: 

“I am delighted that we have reached agreement with our banking club to extend our facilities out to  October 2025. This reflects the strength of our financial position and the quality of our relationships  with our banking partners. Although trading has been better than expected over the last five months,  we need to maintain financial flexibility given the uncertain trajectory of Covid-19 since March 2020.  Against that backdrop, it is very positive that the banking club have also agreed to defer testing of the  Net Debt to EBITDA and Interest Cover covenants until June 2023.  

The ongoing support we have received from our banking partners, shareholders and institutional  landlords, coupled with the welcome assistance from the Irish and UK Governments, has been critical  in allowing us to protect the business and our employees during this time. Trade has surpassed our  expectations over the last two months. As each segment of our customer base opens up, the recovery  in demand has been very strong. We await the return of international corporate travel and the demand  associated with large conferences. However, it is very encouraging to see international leisure visitors  starting to return to Dublin as well as the continuing strength of the domestic corporate and leisure  segments across both Ireland and the UK. Whilst still not back to pre-pandemic trading levels, it is good  to be firmly established on the path to recovery. 

It is with great pleasure that I announce the appointment of Conal O’Neill as Group COO. Conal has  played a crucial role within the Operations team since he joined Dalata in 2014 including through the  most recent period of tremendous challenge for our industry. I look forward to continuing to work  alongside Conal in his new position as COO as our business recovers and continues to deliver on our  expansion plans.  

Having assumed the role of CEO this week, I would like to take the opportunity to wish Pat McCann the  best for his retirement and thank him for his leadership in creating and growing Dalata into the  ambitious business it is today. I am excited about leading Dalata into the future and looking forward  to meeting the challenges and taking advantage of the opportunities that lie ahead”.

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