Macdonald Hotels, the UK’s largest independent hotel group, has seen what it described as an “avalanche” of bookings for next year on the back of the weak pound.
The company’s managing director Gordon Fraser said that tour operators from China, Japan and the US had been behind the surge in business the firm was seeing on its books for 2017-18.
We are excited about the opportunities for further growth in the next few yearsGordon Fraser
The update came as the Bathgate-based company, of which the Macdonald family owns 90 per cent, reported another year of growth and further progress in reducing its debts in line with an agreement with its bankers.
Its core bank debt reduced to £196 million in the last financial year to 31 March, meaning the group had reduced the figure by more than £500m since 2003.
Group turnover rose 5 per cent during the year to £163.4m with operating profits up by a similar level to £17.7m.
Fraser, who is also deputy chairman, said the business was now in “the best shape ever” and was also expecting significant benefits from the Brexit vote, with the weaker pound making the UK more attractive for overseas visitors and encouraging more domestic holidaymakers to opt for “staycations”.
“We are quietly excited about the opportunities for further growth in the next few years. It’s been a tremendous combined effort by the workforce and the management team to put in such a strong, sustained performance while at the same time reducing our debts by half a billion pounds in just 13 years,” said Fraser.
“I can’t think of many businesses in our sector which could have done that, but it’s testament to the drive and hard work of all our people.”
In addition to its hotel portfolio of 55 sites in the UK and overseas, the group has a pipeline of development opportunities, including residential and care home investments, on land it owns.
“We’ve agreed heads of terms for joint ventures worth more than £50m, with a further £40m to follow, which will enable continued investment in our properties, our people and further debt reduction.”
During the year the group invested £13m in its properties, including the completion of a major refurbishment of the Macdonald Aviemore Highland Resort.
It is currently completing a bedroom refurbishment at the Macdonald Holyrood in Edinburgh along with major investment programmes at Houstoun House in West Lothian and Forest Hills near Aberfoyle.