GHL Gresham Hotel

RNS Number:1264J
Gresham Hotel Group Plc
29 August 2001

                           Gresham Hotel Group plc

                                Trading Update

As reported at the AGM and more recently in a shareholder circular, Group
trading has been affected by the travel restrictions that were put in place
following the outbreak of Foot and Mouth Disease in the U.K. and Ireland. This
has coincided with a softening in the international business market.

Whilst the Group is due to announce its Interim Results at the end of next
month, in accordance with best practice, the Directors are announcing that in
their opinion profits before tax and exceptional once-off items for the first
half are likely to be approximately Euro1.5m which is below expectations. This
compares with Euro4.1m in the first half of 2000. The second half of the
financial year has traditionally been more profitable and we expect this trend
to continue. Initial indications are that trading conditions in the second
half of the year remain more difficult than the same period last year,
however, the Directors envisage that while not attaining last years
performance, the Group will not be as adversely affected as in the first six
months.

In addition, as previously stated, once-off costs relating to the Sale &
Leaseback of The Royal Marine Hotel of approximately Euro0.9m and rebranding
costs of approximately Euro0.65m will also be written off in the current
financial year.

The funds generated from the Royal Marine have been used to reduce gearing to
approximately 50% at the half year stage and the Board remains confident that
the rebranding of the Group will significantly increase the cross-selling
opportunities.

Following our undertaking last year, a complete revaluation of all our
properties is well advanced and will be incorporated in the Interim Results.
Whilst an overall increase in value is expected, a further once-off cost
relating to the carrying value of The Carat Hotel in Germany is anticipated,
and will be treated as an exceptional item in the Profit & Loss Account. This
movement in property values will have no cash effect for the Group and will
increase the Net Asset Value per Share.

For further information contact:

Patrick Coyle, Chief Executive, Gresham Hotel Group plc      + 353 1 817 6209

Robert Bastow, Finance Director, Gresham Hotel Group plc     + 353 1 817 6209

Fiona Gillespie, Communications Consultant                   + 353 87 250 2447

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