RNS Number:4420G
Thistle Hotels PLC
1 March 2000
Preliminary Announcement of Annual Results
for the 52 weeks ended 26 December, 1999
"Thistle announce #75 million pre-tax profits"
* Adjusted earnings per share up 2.5% to 12.2p
* Retained hotel gross profit before fixed charges up 1.6% #160.9
million
* Revenue per available room ("Revpar") growth 1.2% in retained hotels
* Final ordinary dividend of 3.2 pence per share recommended, up 6.7%
* Special dividend of #92.4 million paid in April 1999 - completing
second tranche of #185 million return of capital to shareholders
Highlights 52 weeks % change 52 weeks
ended ended
26/12/99 27/12/98
Turnover (#m)
Retained hotels 300.2 1.7 295.2
Other hotels 4.5 (86.5) 33.4
Total 304.7 (7.3) 328.6
Revenue per available room - 50.43 1.2 49.83
retained hotels (#)
Hotel gross profit before fixed
charges (#m)
Retained hotels 160.9 1.6 158.3
Other hotels 2.0 (84.7) 13.1
Total 162.9 (5.0) 171.4
EBITDA (#m) 128.8 (4.5) 134.8
Operating profit (before 112.0 (6.9) 120.3
exceptional items #m)
Profit before taxation (#m) 75.0 60.3 46.8
Adjusted earnings per share (p) 12.2 2.5 11.9
Dividend per share (final) (p) 3.2 6.7 3.0
Commenting on the results, David Newbigging, Chairman said "The focus
throughout 1999 was on implementing the initiatives started some
eighteen months ago to establish Thistle as a consistent full service,
four star hotel brand operating hotels in London and other key locations
throughout the United Kingdom."
"The market remains competitive but the improvements to our portfolio
enable us to compete more effectively in this environment. In the first
eight weeks of the current financial year, like for like revenue is
slightly ahead in London but slightly behind last year overall. We
remain firmly focused on developing initiatives to drive improvements in
our revenue per available room."
Enquiries:
Thistle Hotels Plc
Ian Burke, Chief Executive 020 7723 8383
Hogarth Partnership Limited
Nick Denton 020 7357 9477
Rachel Hirst
NOTES TO EDITORS
Thistle is the largest hotel group in London with 23 hotels in prime
locations throughout the capital and has hotels in key regional cities
of England, Scotland and Wales.
There are 58 hotels in the group with a total of approximately 10,800
bedrooms. In London, Thistle has 6,349 rooms in 23 hotels and in the
Regions 4,494 rooms in 35 hotels.
Thistle's London hotels include the Thistle Tower, the Thistle Charing
Cross, the Thistle Marble Arch, the Thistle Kensington Gardens, the
Thistle Victoria and The Royal Horseguards. Thistle has hotels in
Aberdeen, Bristol, Birmingham, Cardiff, Edinburgh, Glasgow, Liverpool,
Manchester and Newcastle among other regional centres as well as hotels
at airports in Aberdeen, East Midlands, Gatwick, Heathrow, Luton and
Manchester.
Thistle Hotels won three awards in 1999, 'Best use of Technology by a
Hotel Chain' and 'Best Web Site by a Hotel Chain' for our web site
www.thistlehotels.com at the inaugural Hospitality Solutions '99 Awards;
and 'Best Hotel Group' at the Group Travel Awards.
CHAIRMAN'S STATEMENT
Results
Profit before tax for the 52 weeks ended 26 December 1999 was #75.0
million. This compares with #46.8 million in 1998 after deducting
exceptional items of #39.8 million. Earnings per share, adjusted for
exceptional items, rose from 11.9 pence to 12.2 pence in 1999; an
increase of 2.5%.
Dividends
A special dividend of 17.06 pence per share was paid to shareholders on
30 April 1999. An interim dividend of 1.6 pence per share was paid on
19 November 1999 and the Board is now recommending a final dividend of
3.2 pence per share. If approved, this would result in total
dividends for 1999 of 4.8 pence per share, excluding the special
dividend paid in April, representing a 6.7% increase over 1998.
Finance
As reported previously, a total of #185 million was returned to
shareholders in late 1998 and early 1999 and we ended 1999 with a debt
ratio of 39%. We regard this as manageable and our intention is to
ensure that we maintain a prudent balance sheet. The disposal of
underperforming assets and management of operational cash flow before
capital expenditures are important components of this.
Operations
The focus throughout 1999 was on implementing the initiatives started
some eighteen months ago to establish Thistle as a consistent full
service, four star hotel brand operating hotels in London and other key
locations throughout the United Kingdom. These initiatives include
creating a more consistent Thistle brand, improving the product and
service quality of our hotels, and upgrading our information technology
systems.
We currently own 58 hotels with 10,843 rooms of which 50 are now branded
as Thistle. These numbers represent a reduction of 37 hotels and 2,396
rooms through disposals since early 1998; mainly consisting of hotels
which we considered did not have the potential for upgrading to four
star. These disposals, together with the sale of the majority of our
non-hotel assets, have generated total proceeds of over #108 million. As
a result of these sales, turnover and profit in 1999 were lower than in
1998 but the quality of our hotel portfolio is now much higher, as
reflected in the 10.4% increase in 1999 in the revenue per available
room (Revpar) for the Group overall.
Further progress was made during the year in upgrading the quality of
our hotels with almost 1,400 rooms being renovated to the new Thistle
standard. An additional 3,600 rooms will be upgraded in 2000 and 2001
bringing to a close the major and disruptive programme to upgrade all of
our hotels. In 1999 #56 million was spent on upgrading hotels and #9
million was spent on a long overdue upgrading of our information
technology systems.
Prospects
The market remains competitive but the improvements to our portfolio
enable us to compete more effectively in this environment. In the first
eight weeks of the current financial year, like for like revenue is
slightly ahead in London but slightly behind last year overall. We
remain firmly focused on developing initiatives to drive improvements in
our Revpar.
KEY OPERATING STATISTICS
------------------------
Retained Portfolio
------------------
52 weeks 52 weeks
ended ended %
26/12/99 27/12/98 change
-----------------------------------------------------------------------
London
Occupancy 79.3% 76.2% 4.1%
Average Room Rate (#) 75.04 77.40 -3.0%
Revenue per available room (#) 59.51 58.98 0.9%
Turnover (#m) 192.5 188.9 1.9%
-----------------------------------------------------------------------
Regions
Occupancy 68.2% 65.8% 3.7%
Average Room Rate (#) 53.85 55.01 -2.1%
Revenue per available room (#) 36.73 36.20 1.5%
Turnover (#m) 107.7 106.3 1.3%
-----------------------------------------------------------------------
Group
Occupancy 74.9% 72.0% 4.0%
Average Room Rate (#) 67.33 69.21 -2.7%
Revenue per available room (#) 50.43 49.83 1.2%
Turnover (#m) 300.2 295.2 1.7%
-----------------------------------------------------------------------
Total Group
----------- 52 weeks 52 weeks
ended ended %
26/12/99 27/12/98 change
-----------------------------------------------------------------------
London
Occupancy 79.3% 76.3% 3.9%
Average Room Rate (#) 74.65 76.80 -2.8%
Revenue per available room (#) 59.20 58.60 1.0%
Turnover (#m) 194.8 192.5 1.2%
-----------------------------------------------------------------------
Regions
Occupancy 67.5% 60.9% 10.8%
Average Room Rate (#) 53.31 50.86 4.8%
Revenue per available room (#) 35.98 30.97 16.2%
Turnover (#m) 109.9 136.1 -19.3%
-----------------------------------------------------------------------
Group
Occupancy 74.5% 68.8% 8.3%
Average Room Rate (#) 66.86 65.57 2.0%
Revenue per available room (#) 49.81 45.11 10.4%
Turnover (#m) 304.7 328.6 -7.3%
-----------------------------------------------------------------------
Retained hotels exclude the 37 hotels which were sold during 1998, 1999
and in 2000 to date, as well as the Wellesley Hotel and the Dee Motel,
which are in the process of being sold, and Middlesbrough, which is
currently closed.
PRELIMINARY RESULTS ANNOUNCEMENT
Good progress was made in implementing the initiatives we identified
eighteen months ago as necessary to position Thistle Hotels as a strong,
full service four star hotel company over a three year period. Now we
are half way through the process, better performance is already
beginning to show through as a result of upgrading our hotels,
introducing new information technology systems and developing our
people. We have made progress in our comparative revenue per available
room position in both London and the Regions and we expect further
improvement in our competitive position this year.
On a like for like basis, turnover increased by 1.7% from #295.2 million
to #300.2 million. This was driven by a 2.9 percentage point increase in
occupancy to 74.9%, offset by a 2.7% decrease in average room rates from
#69.21 to #67.33. Like for like revenue per available room increased by
1.2% to #50.43. Hotel gross profit before fixed charges and exceptional
items on this basis increased by 1.6% from #158.3 million to #160.9
million.
SEGMENTAL REVIEW
A summary of hotel turnover and gross profit for retained hotels in
London and the Regions is set out below:
Retained Portfolio
------------------
London Regions Group
1999 1998 1999 1998 1999 1998
---------------------------------------------------------------------------
Hotel Turnover (#m) 192.5 188.9 107.7 106.3 300.2 295.2
Hotel gross profit (before 111.2 108.5 49.7 49.8 160.9 158.3
fixed charges) #m
Hotel gross profit margin 57.8% 57.4% 46.1% 46.8% 53.6% 53.6%
(before fixed charges)
---------------------------------------------------------------------------
Fixed charges comprise property rent, rates and insurance, depreciation
and amortisation.
LONDON
The London hotel market remained competitive throughout much of the
year, with an estimated 3,500 new rooms opened in 1999. We anticipate
that approximately 3,000 additional rooms will open in each of the next
two years reflecting continuing growth in demand for London hotel rooms.
Against this background, turnover in our 23 retained London hotels
increased by 1.9% to #192.5 million. Gross profit before fixed charges
increased by 2.5% to #111.2 million - a margin of 57.8%.
During the year we undertook a number of sales and marketing initiatives
to target commercial and higher spend leisure customers. Occupancy
improved from 76.2% to 79.3%. With a larger number of leisure
customers, overall average room rates fell by 3.0% to #75.04, generating
a 0.9% increase in revenue per available room from #58.98 to #59.51. A
stronger performance was achieved in the fourth quarter where we
achieved an 8.2% increase in revenue per available room versus the
previous year, reflecting improved overall conditions and results in a
number of hotels after completing room upgrade projects.
REGIONS
In our retained regional hotels the overall picture was much the same as
for London, although trading conditions weakened as the year progressed.
Turnover increased by 1.3% to #107.7 million and gross profit before
fixed charges remained essentially unchanged at #49.7 million (1998:
#49.8 million) - representing a margin of 46.1%.
Revenue per available room increased by 1.5% to #36.73. As in London,
this was driven by an increase in occupancy, from 65.8% to 68.2%, offset
by a 2.1% fall in average room rates to #53.85. Particularly strong
performances were achieved in our hotels in Brighton and Cardiff as well
as at Brands Hatch, where a new full leisure club was opened earlier in
the year. The addition of this leisure club has changed the nature of
the hotel as it is now able to compete for mid-week conference and
weekend leisure business.
With over 700 rooms (representing over 15% of our regional room stock)
in five hotels in Aberdeen, our regional performance continues to be
affected by the lower level of activity related to the North Sea oil
industry. Excluding Aberdeen, regional occupancy increased from 67.3% to
70.6% and revenue per available room increased by 3.5% to #39.12.
BRAND MANAGEMENT
The Thistle brand is now established at 50 of the Group's 58 hotels
(approximately 9,300 rooms out of the portfolio's 10,843.) The
conversion of a further three hotels - Middlesbrough, Heathrow and
Barbican in London - over the next 12 months, will conclude the
programme of converting those hotels capable of meeting the four star
standards of the full service Thistle brand.
We classify demand for hotel products and services into four broad
market segments : namely individual business travellers, conference and
seminar attendees, short break leisure customers and groups or
individuals on a leisure tour. Thistle's sales and marketing activity
is focused on reaching the customers in these segments in the most
appropriate way, in order to increase overall revenue per available
room.
The conference and meetings market represents an opportunity for Thistle
to continue to increase the number of corporate customers utilising the
hotels and the Meeting Plan product has been developed to offer
consistency in this key market segment. Meeting Plan has been
successfully implemented in three hotels and we plan to introduce this
product into a further 20 during 2000.
A number of initiatives were implemented during the year to strengthen
the brand's position and to grow non rooms revenue. These include new
food and beverage concepts with four Co.Motion brew shops open and plans
for a further 20 to be added during the current year. Three restaurant
concepts were developed and opened, including Faya Mediterranean Bar and
Grills at the Thistle Kings Cross and the Thistle Euston and Gengis, an
Asian Mediterranean concept, at the Thistle Glasgow.
Business and leisure travellers increasingly expect fitness and health
facilities available during their hotel stay. Our first new Otium Health
& Leisure Club was opened during the year at the Thistle Brands Hatch
and based upon the success of this project and the out-performance of
those hotels which have existing leisure facilities, a further four are
currently under construction. We aim to have 20 Otium Clubs open by the
end of 2001. In hotels where it is not possible to add a full leisure
club, a fitness centre branded "Just Gym" will be developed and the
first of these has opened at The Royal Horseguards.
A key element of achieving a consistent and high quality brand is the
completion of the renovation programme and the disposal of assets
considered by us as not being capable of meeting the Thistle brand
standards. Capital expenditure during the year included #56 million on
hotel upgrades with almost 1,400 rooms upgraded to Thistle standard.
The major projects were the opening of the Thistle Charing Cross after a
complete refurbishment, the renovation of the 7th floor at the Thistle
Marble Arch and the upgrading of over 70 bedrooms in each of the Thistle
Tower, Thistle Euston, The Barbican and Thistle Victoria hotels in
London. In each of these hotels, improvement in revenue per available
room, has been achieved following the renovation programme.
6,800 rooms have now been renovated to the Thistle standard and it
remains the Group's intention to have renovated all remaining rooms by
the end of 2001 thus concluding the major and disruptive upgrade
programme. There will be an acceleration of the room upgrade programme
in 2000 compared to previous years, with 1,800 rooms to be renovated
this year.
An additional 115 new rooms were added to existing hotels in the year of
which 54 rooms were added at the Thistle East Midlands Airport and 24
rooms were added at the Thistle Kings Cross.
There were a number of asset disposals during the year including the
hotel in Woburn, Bedfordshire for #3.1 million in March and the Charles
Dickens hotel, London for #21.5 million in August. The proceeds from the
sale of other ancillary properties in the year totalled #5.5 million.
The Black Bull hotel in Glasgow was sold earlier this year. Following
the disposal of the Wellesley hotel and the Dee Motel, which are
expected to be sold during the first half of 2000, this will bring the
aggregate value of proceeds from asset disposals since early 1998 to
over #114 million. The only remaining ancillary properties that the
Group now owns are the Leeds administrative office, a small number of
shops located within hotels and staff accommodation houses.
INFORMATION TECHNOLOGY SYSTEMS
The major information technology systems initiatives outlined in last
year's Annual Report to enhance and upgrade computer systems across the
Group are complete. The Fidelio front office system has been installed
in all hotels completing the programme which commenced in August 1998.
The Central Reservations System was launched in June 1999 and was fully
integrated with all hotel front office systems by the end of the year.
The management information system utilising SAP software has been
implemented in all hotels as well as the support offices in Leeds and
London.
The new information technology systems implemented are enabling us to
better manage our rooms inventory and to sell rooms through emerging
distribution channels. Our web site, www.thistlehotels.com, was launched
in August 1999 and was declared "Best web site by a hotel chain" at the
Hospitality Solutions 1999 Awards. Currently over #20,000 of room
bookings are being made through this site each week, a level which we
would expect to grow significantly in the coming years.
The key systems developments in the current financial year will be to
invest further in developing our e-commerce capability, to introduce
yield management systems for further improvements in rooms inventory
management and to introduce systems to enable us to manage more
effectively our conference and banqueting business.
PEOPLE
Our major focus in relation to hotel operational management revolves
around the initiatives we have developed and are implementing to
strengthen the skills and competencies of management and staff across
the business. All hotels aim to have achieved the Investors in People
accreditation by the middle of this year, with 40 already at this
standard. Staff satisfaction is monitored annually by means of an
independent employee survey. A stakeholder-type pension plan will be
made available to employees in May ahead of the Government's guidelines.
A major customer service improvement programme - "Be My Guest" - was
piloted in a number of hotels in late 1999 and will be implemented
across all hotels during the current year. The objectives of this
programme are to achieve a higher and consistent level of service
delivery, through staff training and by making improvements in our
service delivery processes.
Further training initiatives are in hand to raise the skills of our
staff and to reduce staff turnover and a new graduate development
programme will be introduced in 2000 to ensure we are developing high
calibre resources to meet our future managerial needs.
FINANCIAL REVIEW
Balance sheet, debt and interest charges
At the year end, the total capital employed by the Group of #1,638.7
million was financed by net debt of #461.6 million and equity
shareholders' funds of #1,177.1 million. In April, additional debt of
#105 million was raised in order to fund the payment of the #92.4
million special dividend. This dividend payment represented the second
and final tranche of the #185 million return of capital announced in
September 1998.
As a result, net debt has risen from #381.4 million at the end of the
last financial year to #461.6 million, resulting in increased balance
sheet gearing at 39% (1998: 31%). Interest charges totalled #37.7
million (1998: #33.7 million) and interest cover decreased from 3.6
times to 3.0 times, which was in line with our expectations.
At the same time as the payment of the special dividend, the Company's
share capital was consolidated on the basis of 8 new shares for every 9
existing shares in order to facilitate comparability with prior year
share data and mimic the effect of a share buyback. In addition to the
earnings enhancement noted above, the return of capital also had the
effect of reducing the Company's overall cost of capital.
On 11 July 1999, a valuation of eleven hotels representing approximately
25% of the portfolio, by value, was carried out by Christie & Co. in
accordance with the Group's policy of undertaking a rolling five year
valuation of its fixed asset base. The valuation resulted in a surplus
to book value of #3.8 million which has been reflected in the balance
sheet.
Cash flow
The Group's cash flow from operating activities in the year amounted to
#116.8 million. After spending a further #63.0 million on the ongoing
refurbishment of the Group's hotels and Information Technology systems,
#71.6 million was applied to the payment of interest, corporation tax
and ordinary dividends. In April, #105 million new loans were
established in order to fund the payment of the special dividend, whilst
in October, proceeds generated from the sale of the Charles Dickens were
utilised in order to repay #21 million of the loans raised earlier in
the year.
Taxation
The Group's effective tax rate (before exceptional items) in 1999 was
17.9% (1998: 16.7%). While practically all of the tax losses brought
forward have now been fully utilised, the Group's tax charge continues
to benefit from the allowances which are generated on its capital
investment program. An analysis of the taxation charge is set out in
Note 5 to the announcement.
Dividends
Subject to approval at the Annual General Meeting, the directors intend
to pay a final dividend of 3.2 pence per share on 18 May 2000 to
shareholders on the register on 14 April 2000. Together with the interim
dividend of 1.6 pence per share, this gives total ordinary dividends for
the year of 4.8 pence per share. As stated above, the Company also paid
a special dividend of #92.4 million in April.
Accounting Standards
Accounting Standards adopted for the first time in this financial year
were FRS 12 (Provisions, Contingent Liabilities and Contingent Assets)
and FRS 13 (Derivatives and Other Financial Instruments: Disclosures).
FRS 14 (Earnings per share) was adopted in 1998.
A review has been undertaken to ascertain the impact of FRS 15 (Tangible
Fixed Assets) which will be adopted next year. The application of this
accounting standard will, inter alia, have an impact upon the Company's
reported earnings as a result of the requirement to depreciate hotel
buildings, which in line with current practice in the UK hotel industry,
have not historically been depreciated. The approximate increase in the
annual depreciation charge arising from the implementation of the
standard is currently estimated to be in the range #10 million to #12
million.
THISTLE HOTELS Plc
PRELIMINARY ANNOUNCEMENT
GROUP PROFIT & LOSS ACCOUNT
for the financial year ended 26 December 1999
---------------------------------------------
Before
Excep- Excep-
tional tional
items items Total
1999 1998 1998 1998
Note #'m #'m #'m #'m
---- ------- ------- ------- --------
Turnover 1 304.7 328.6 - 328.6
Cost of sales (176.3) (190.5) (19.1) (209.6)
------- -----------------------------
Gross profit 1 128.4 138.1 (19.1) 119.0
Administrative expenses (16.4) (17.8) - (17.8)
------- -----------------------------
Operating profit 2 112.0 120.3 (19.1) 101.2
Profit/(loss) on sale of 3 0.7 - (17.7) (17.7)
tangible fixed assets
Provision for loss on sale 3 - - (3.0) (3.0)
of tangible fixed assets
Interest payable 4 (37.7) (33.7) - (33.7)
------- -----------------------------
Profit before taxation 75.0 86.6 (39.8) 46.8
Taxation 5 (13.3) (14.5) (1.8) (16.3)
------- -----------------------------
Profit after taxation 61.7 72.1 (41.6) 30.5
Dividends 6 (115.5) (25.5) - (25.5)
------- -----------------------------
Transfer (from)/to reserves (53.8) 46.6 (41.6) 5.0
======= =============================
Earnings per share 12.3p 5.0p
Diluted earnings per share 12.3p 5.0p
Adjusted earnings per share 12.2p 11.9p
Adjusted earnings per share is based on the Group's profit after
taxation for the year but before exceptional items and on the weighted
average number of shares in issue.
THISTLE HOTELS Plc
PRELIMINARY ANNOUNCEMENT
GROUP BALANCE SHEET
at 26 December 1999
-------------------
1999 1998
Note #'m #'m
---- -------- --------
Fixed assets
Tangible assets 1,667.7 1,646.4
-------- --------
Current assets
Stocks 1.4 1.6
Debtors 35.5 36.1
Investments 0.1 0.1
Cash at bank and in hand 6.0 3.0
-------- --------
43.0 40.8
Creditors (due within one year) (99.8) (107.1)
-------- --------
Net current liabilities (56.8) (66.3)
-------- --------
Total assets less current liabilities 1,610.9 1,580.1
Creditors (due after one year) (433.8) (349.8)
Provisions for liabilities and charges 7 - (3.5)
-------- --------
Net assets 1,177.1 1,226.8
======== ========
Equity capital & reserves
Called up share capital 123.5 123.5
Share premium account 398.1 397.8
Revaluation reserve 448.8 446.0
Other reserves 50.8 50.8
Profit and loss account 155.9 208.7
-------- --------
Total equity shareholders' funds 1,177.1 1,226.8
======== ========
THISTLE HOTELS Plc
PRELIMINARY ANNOUNCEMENT
GROUP CASH FLOW STATEMENT
for the financial year ended 26 December 1999
---------------------------------------------
1999 1998
Note #'m #'m
---- ------- -------
Cash flow from operating 8 116.8 134.6
activities
Returns on investments &
servicing of finance
Interest paid (37.4) (34.6)
Taxation paid (10.3) (7.3)
Capital expenditure
Purchase of tangible fixed assets (63.0) (55.7)
Sale of tangible fixed assets 29.7 74.5
------ ------
(33.3) 18.8
Equity dividends paid
Ordinary dividends paid (23.9) (26.5)
Special dividends paid (92.4) -
------ ------
(116.3) (26.5)
------- -------
Cash (outflow)/inflow before (80.5) 85.0
financing
Financing
Issue of share capital 0.3 0.1
Redemption of share capital - (92.6)
New loans 105.0 -
Loans repaid (26.0) (20.0)
------ ------
79.3 (112.5)
------- -------
Decrease in cash (1.2) (27.5)
======= =======
Total capital returned to shareholders since November 1998 amounts to
#185 million, comprising the #92.6 million redemption of share capital
in November 1998 and the special dividend of #92.4 million paid in April
1999.
Reconciliation of net debt 1999 1998
#'m #'m
------- -------
Decrease in cash in the year (1.2) (27.5)
Cash flow from (79.0) 20.0
(increase)/decrease in debt
------- -------
Movement in net debt in the year (80.2) (7.5)
Net debt at beginning of year (381.4) (373.9)
------- -------
Net debt at end of year (461.6) (381.4)
======= =======
THISTLE HOTELS Plc
PRELIMINARY ANNOUNCEMENT
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
1999 1998
#'m #'m
------- -------
Profit for the financial year 61.7 30.5
Unrealised surplus on revaluation of properties 3.8 -
-----------------
Total gains and losses relating to the year 65.5 30.5
=================
NOTE OF HISTORICAL COST PROFITS AND LOSSES
1999 1998
#'m #'m
------- -------
Profit before taxation as reported 75.0 46.8
Realisation of property revaluation gains of previous 1.0 10.2
years
-----------------
Historical cost profit before taxation 76.0 57.0
=================
Historical cost (loss)/profit (transferred)/retained (52.8) 15.2
after taxation and dividends
=================
RECONCILIATION OF MOVEMENTS IN EQUITY SHAREHOLDERS' FUNDS
1999 1998
#'m #'m
-------- --------
Profit for the financial year 61.7 30.5
Dividends (115.5) (25.5)
Issue of share capital 0.3 0.1
Redemption of share capital - (92.6)
Unrealised surplus on revaluation of properties 3.8 -
-----------------
Net change in the year (49.7) (87.5)
Opening equity shareholders' funds 1,226.8 1,314.3
-----------------
Closing equity shareholders' funds 1,177.1 1,226.8
=================
THISTLE HOTELS Plc
PRELIMINARY ANNOUNCEMENT
The foregoing statements do not constitute the Group's statutory
accounts. The Group's 1999 statutory accounts, on which the Group's
auditors, PricewaterhouseCoopers, have given an unqualified opinion in
accordance with section 235 of the Companies Act 1985, are to be
delivered to the Registrar of Companies. The Group's 1998 statutory
accounts have been filed with the Registrar of Companies.
BASIS OF ACCOUNTING
The accounts have been prepared under the historical cost convention as
modified by the revaluation of certain properties and in accordance with
applicable accounting standards.
BASIS OF PREPARATION
The group accounts comprise a consolidation of the accounts of the
holding company and its subsidiaries, all of which are prepared up to
the same date as the holding company. Uniform accounting policies are
adopted by all companies in the Group. Results of subsidiaries acquired
or disposed of during the year are included for the period during which
they are within the Group.
NOTES
1. Segment analysis 1999 1998
------------------- #'m #'m
-------- --------
Turnover by UK region
---------------------
London - retained 192.5 188.9
London - other 2.3 3.6
Regions - retained 107.7 106.3
Regions - other 2.2 29.8
-------- --------
Total Group turnover* 304.7 328.6
======== ========
*Of which:
Retained 300.2 295.2
Other 4.5 33.4
======== ========
Gross profit before fixed charges by UK region
----------------------------------------------
London - retained 111.2 108.5
London - other 1.5 2.6
Regions - retained 49.7 49.8
Regions - other 0.5 10.5
-------- --------
Total** 162.9 171.4
Fixed charges (34.5) (33.3)
-------- --------
Total Group gross profit 128.4 138.1
======== ========
**Of which:
Retained 160.9 158.3
Other 2.0 13.1
======== ========
The prior year figures above are before exceptional items of #19.1
million charged before operating profit.
In previous years, telephone revenues were offset against telephone
costs within hotel operating expenses. From the beginning of the current
financial year, telephone revenues have been included in turnover to
facilitate comparability with other hotel operators. Prior year figures
have been restated accordingly.
Fixed charges comprise property rent, rates and insurance, depreciation
and amortisation.
2. Operating profit 1999 1998
------------------- #'m #'m
-------- --------
This is stated after charging :-
Depreciation and amortisation 16.8 14.5
Repairs and renewals 7.6 10.3
Cost of sales in 1998 Is stated after charging asset impairment
provisions amounting to #19.1 million which were made in relation to
certain of the Group's freehold and leasehold interests in accordance
with FRS 11. These write-downs have been disclosed as exceptional items
on the face of the profit and loss account.
3. Profit/(loss) on sale of tangible fixed assets
-------------------------------------------------
1999 1998
#'m #'m
-------- --------
Profit on sale of tangible fixed assets 0.7 9.8
Loss on sale of tangible fixed assets - (27.5)
-------- --------
0.7 (17.7)
Provision for loss on sale of fixed assets - (3.0)
-------- --------
0.7 (20.7)
======== ========
During the year, the Group disposed of two non-core hotels and a number
of ancillary properties.
4. Interest payable and similar charges 1999 1998
--------------------------------------- #'m #'m
-------- --------
Interest on long term loans 27.6 28.8
Interest on bank overdrafts and loans repayable 9.6 4.3
within 5 years
Bank charges 0.5 0.6
-------- --------
37.7 33.7
======== ========
5. Taxation 1999 1998
----------- #'m #'m
-------- --------
Corporation tax at 30.25% (1998: 31%) 13.0 21.1
ACT written back - (4.8)
ACT written off 0.3 -
-------- --------
13.3 16.3
======== ========
The corporation tax charge based on the profit
for the year has benefited from capital
allowances and relief for losses brought forward
of approximately 9.5 6.0
======== ========
Losses available for relief against future 0.2 0.3
profits
======== ========
The directors estimate that the corporation tax liability which would
arise if all hotels included in fixed assets were sold at valuation
would not exceed #140 million (1998: #140 million).
6. Dividends 1999 1998
------------ #'m #'m
-------- --------
Interim dividend paid of 1.6 pence 7.7 9.3
(1998: 1.5 pence)
Special dividend paid of 17.06 pence 92.4 -
(1998: nil)
Final dividend proposed of 3.2 pence 15.4 16.2
(1998: 3.0 pence)
-------------------
115.5 25.5
===================
7. Provisions for liabilities and charges
-----------------------------------------
Closure of
Loss on sale building
of tangible services
fixed assets division Total
#'m #'m #'m
------------- ------------- -------------
At beginning of year 3.0 0.5 3.5
Created in year 1.8 - 1.8
Utilised in year (4.8) (0.5) (5.3)
------------- ------------- -------------
At end of year - - -
============= ============= =============
The provisions established in respect of hotel disposals and the closure
of the building services division were fully utilised in the year.
8. Reconciliation of operating profit to
net cash inflow from operating activities
--------------------------------------------
1999 1998
#'m #'m
-------- --------
Operating profit before exceptional items 112.0 120.3
Depreciation 16.8 14.5
Decrease in stocks 0.2 0.4
Decrease in debtors 0.1 2.2
Decrease in creditors (10.3) (2.8)
Decrease in provisions (2.0) -
-------------------
Net cash inflow from operating activities 116.8 134.6
===================
END
FR UKOARRNRUUUR
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