Menzies Hotels Group has raised £72m with the Royal Bank of Scotland to make "significant hotel acquisitions" following a year of record sales and profits.
In the 12 months to 31 January, the group - which owns and runs 18 properties in the UK, most of them with four stars - boosted pre-tax profits by 17% to £4.84m on turnover 8% ahead at £32.64m.
Chairman Nick Menzies said the group's performance had been aided by its lack of exposure to central London, along with the hotels' "diversity of income through location, style and market sector".
Commercial director Tim Penter added that while "certain groups have been criticised for having a very diverse portfolio", spreading the business across resort, commercial, conference, city centre and rural properties afforded some protection during difficult and unpredictable trading conditions.
Penter said that Menzies was "very actively" looking for new properties and now had the funds in place.
Capital expenditure of £8.51m for the year included £4.1m recovered from insurers for the Menzies East Cliff Court hotel in Bournemouth, which reopened in August 2001 after a major fire closed it in June 2001.
The group also spent £1.2m refurbishing the Menzies Belford hotel in Edinburgh and the Menzies Waterside hotel in Bath, plus another £1.65m building a Waves health and leisure club at the Menzies Silverlink Park hotel in Newcastle-upon-Tyne. All three were bought from Hilton in May 2001.
Nick Menzies was upbeat about future trading for the group. He said: "While the trading environment remains challenging, I am encouraged that revenues in the first quarter of the current financial year have grown by 5%, with respective operating profits prior to the deduction of depreciation increasing by more than 8% on the previous year."
Source: Caterer & Hotelkeeper magazine, 22 -28 May 2003