Peel aiming to strike Olympic gold

The group, which owns the Cosmopolitan Hotel in Leeds and the Midland Hotel in Bradford, said its expects the tough market to continue, but added it is bringing down debt to reduce its interest costs.

Peel said turnover fell 5.2 per cent to £7.8m in the 28 weeks to August 21.

Profits before interest were down 3.5 per cent at £615,000 but it moved into the black on a pre-tax basis after selling a property, achieving profits of £33,000.

“We are prepared for a continuing tough trading environment in the short term and look to contain our costs but we expect the additional activity caused by the Olympics next year will help us grow our sales and improve our profitability,” said chairman Robert Peel.

The company, which has nine hotels with a total of 732 rooms, was unable to recoup a 2.5 per cent increase in VAT sales tax from its customers.

It said revenues per available room – revpar – decreased 1.8 per cent.

Occupancy was down 0.7 per cent and Peel’s average room rate was down 1.2 per cent.

“We are determined to return to growth in revpar by the end of the financial year,” said Mr Peel.

He added the company is managing to contain the decline in revpar “in spite of provincial and commercial expenditure constraints”, helping it generate cash.

Peel cut its net debt by £726,000 to £12.7m from a year earlier.

Peel is increasingly offering special promotions to make its hotels available and easily booked on third-party websites.

“(The company) sees this as a way of compensating for the drops in volume from established methods of making reservations,” said Mr Peel.

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