Malhotra Group Announces Annual Results
Date published:
Leading leisure, care and property business Malhotra Group has unveiled its annual results.
And, despite the inevitable impact of the Covid pandemic, it has revealed it is in a strong trading position and will continue its planned and extensive expansion programme across all sectors of the business.
The Group’s turnover for the year ended 31 March 2021 was £30.9m (2020: £38.1m) reflecting a 19 per cent decrease on the previous year.
The Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA) result was £9.1m (2020: £9.9m), an eight per cent decrease on the previous year and the resultant operating profit decreased by 14 per cent to £6.0m (2020: £7.0m).
However, strong trading conditions since the easing of lockdown restrictions combined with Government support in the form of grants from the Infection Control Fund and Coronavirus Job Retention Scheme – among others - have mitigated the effects of the pandemic.
--Care Division--
The impact of the Covid-19 pandemic was felt throughout the full financial year ended 31 March 2021 and has had an enormous effect on the healthcare sector.
The newly built 86-bedroom Beech Tree House in Alnwick, Northumberland opened in September 2020, offering 20 infection control beds for patients being released from hospital who had tested positive for Covid-19.
This prevented them being placed in other care homes in the region which already held existing residents, helping reduce the risk of spreading infection to already vulnerable people.
Work has continued on the 66-bedroom nursing home development at Ryhope, Sunderland, scheduled for completion in autumn 2021 and on the conversion of the former Rex Hotel at Whitley Bay, North Tyneside, into the 83-bedroom Bay View House care home.
In terms of financial performance for the year end 31 March 2021, fee income remained at £28.1m (2020: £28.1m) and profit before tax was £4.8m (2020: £7.2m).
--Leisure Division--
While its venues remained closed for a large part of the financial year due to lockdowns and localised restrictions in the North East, the company continued with refurbishments and strategic improvements across the portfolio.
These included the completion of the 64-bed, 4 star Great North Hotel and refurbishment of the Three Mile Inn at Gosforth, the development of outdoor areas at Runhead, Ryton, Gateshead and Leila Lily’s, Newcastle and The Three Mile Inn, Gosforth, which has led to positive sales growth post lockdown.
Additionally, the New Northumbria Hotel remains closed for essential repair work, while Osborne’s bar, which has partially re-opened, will fully reopen later this year.
Work has now started on the refurbishment of the historic Cloth Market bar, Balmbra’s and planning permission has been sought for renovations at Market Lane, Pilgrim Street, Newcastle to create a coffee shop and restaurant and, at the Sandpiper pub, Whitley Bay, to create three ground floor retail units and 18 apartments.
Besides its current operational leisure assets, the Group has undertaken a significant land assembly project in Newcastle which encompasses property on Grey Street, Cloth Market and Mosley Street which will be combined into a single scheme.
This project has recently received planning consent from Newcastle City Council for a complex of bars, restaurants, nightclubs, a luxury hotel and a rooftop swimming pool and construction is expected to commence in 2022.
It has also acquired 1 Mosely Street and the adjacent property on Pilgrim Street, for which planning permission has also been obtained for a 25-apartment aparthotel plus three drinking establishments and a rooftop restaurant.
Since the re-opening of the portfolio after lockdown, including the full re-opening of The Three Mile Inn and Great North Hotel post refurbishment, there has been positive sales growth and trading continues to be buoyant, especially in the hotels, partly assisted by the reduced rate VAT and satisfying pent up demand from customers.
In terms of financial performance, given the year of significant closures of the portfolio compared with the capital investment and redevelopment, together with divestment of non-core venues, turnover has reduced to £1.0m (2020: £8.4m) and there has been a reduction in EBITDA to a loss of £0.8m (2020: £0.1m).
--Property Division--
The Group is the eighth largest property owner in the North East with a 1.1 per cent market share and 68th nationally with a 0.3 per cent market share*. Its Net Internal Area is 658,395sq ft.
Turnover increased to £1.8m (2020: £1.6m) and operating profit for the year was £0.1m (2020: £0.4m).
Following the publication of the Malhotra Group plc annual results its Chairman, Meenu Malhotra, said he was “proud” of its performance during the pandemic
“We operate in two of the sectors which were hardest by the pandemic and subsequent lockdowns; care and hospitality,” he said.
“And that we have not only weathered the storm but are in a strong position to move forward, is down to several factors; our highly experienced management team and the diversity of our assets.”
He added: “We would like to thank all our staff for their magnificent contribution during the Covid pandemic.
“Our care staff have been outstanding and worked relentlessly during the last year so that our residents could be provided with high-quality care. We would like to offer our heartfelt thanks for their enormous efforts and dedication.
“The Group is also very proud to have supported not only our staff but the wider community and is grateful for the help it has received from the Government.”