Dawnay Shore Hotels spent £23m upgrading IT and front office management systems to support conference and banqueting at its Paramount hotels last year.

Business remained steady for the group with 2006’s £98.5m turnover the same as the previous year.

Operating profit saw a slight fall of 2% to £36.1m from £35.5m in 2005.

Revenue per available room saw a positive increase to £50.13 (2005: £49.08) thanks to an increase in room rates making up for a marginal decrease in occupancy.

Charles Prew, chief executive of Dawnay Shore Hotels, said: “The growth in hotel operating profits is encouraging given the substantial increase in energy costs incurred during the year.”

The group added 200 rooms to its portfolio, which includes the Lygon Arms in the Cotswolds and the Carlton Hotel in Edinburgh, and introduced its Paramount Signature brand.

Prew added: “We will continue to seek other room and complementary facility additions to our high-quality estate. The increase in individual hotel asset values, reflecting market conditions, further magnifies the value uplift gained from adding rooms to existing hotels.”

The company’s strategic review into maximising shareholder value announced last November was said to be ‘progressing well’ and an announcement is expected shortly.

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DSH enjoys strong start to year >>

By Emily Manson

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