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Hydro Hotel, Eastbourne, Plc (HYDP)

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Wednesday 12 July, 2017

Hydro Hotel, Eastbourne, Plc

Half-year Report

HYDRO HOTEL, EASTBOURNE, PLC
Interim Report and Accounts
Half Year ended 30 April 2017

   

HYDRO HOTEL, EASTBOURNE, PLC
YOUR CHAIRMAN'S LETTER
Dear Shareholder,
SIX MONTHS TO 30 APRIL 2017
I am pleased to report an increase in the turnover of the hotel for each of the first six months of the current financial year as compared to the previous year.  The total turnover for the six month period to 30 April 2017 was £1,519,004 compared to £1,325,291 for the same period the previous year, an increase of 14.62% (compared to an increase in the six months to 30 April 2016 of 1.2%). The improvement in turnover resulted from an increase in the number of rooms sold and the number of guests visiting the hotel for the six month period to 30 April 2017, compared to the six month period to 30 April 2016. The board are pleased to note that the implementation of the new manager’s strategic plan for the hotel is having a positive effect on sales.
The gross profit percentage for the period was 0.22% lower than the gross profit percentage for the six months to 30 April 2016 but staff costs increased by 17.10% (2.2% decrease in the half year to 30 April 2016) and overheads increased by 18.05% (3.9% decrease in the half year to 30 April 2016), which led to an increase in the loss for the half year to 30 April 2017 to £152,741 compared to £98,640 for the half year to 30 April 2016.  Staff costs rose partly due to a restructuring of the management team and  additional staff required to service a higher turnover.  Overheads increased largely due to an increase in repair costs of £62,094 compared to the half year to 30 April 2016. This resulted from an extensive refurbishment programme during the period, which had been put on hold last year due to the change of manager.   Repair work undertaken included the redecoration of 29 bedrooms and the lounges and the Garden Suite, and resurfacing of the outdoor pool.
The refurbishment programme also resulted in significant capital investment made in the hotel in the period, with £215,977 spent on tangible fixed assets including the purchase of new furniture and soft furnishings for the lounges and the Garden Suite, a new website, the installation of a new oven and communal area lighting, redesigning and refurbishment of 29 bedrooms, and the conversion of a former staff flat creating a new bedroom suite increasing the bedroom stock from 81 to 82.
Following on from the improvements made during the last six months, the board is pleased to announce that the hotel has now been upgraded by the AA to 4* status and we offer our congratulations to Jonathan Owen, our general manager, on achieving the upgrade almost within a year of coming to the hotel.  This 4* status reflects the dedication to providing excellent service by all the staff at the hotel.
For those shareholders who have yet to enjoy the recent improvements to the hotel, Jonathan and his team would be delighted to show you the changes made.
Yours sincerely,
Graeme C King, MA, CA
11 July 2017

HYDRO HOTEL, EASTBOURNE, PLC
STATEMENT OF COMPREHENSIVE INCOME
FOR THE HALF YEAR ENDED 30 APRIL 2017
Half year to Half year to Year ended
30 April    2017 30 April    2016 31 October 2016
(Unaudited) (Unaudited) (Audited)
£ £ £
TURNOVER 1,519,004 1,325,291 3,208,172
OPERATING (LOSS)/PROFIT (156,789) (104,818) 213,657
INTEREST RECEIVABLE 4,048  6,178 10,695
(LOSS)/PROFIT BEFORE TAXATION (152,741) (98,640) 224,352
TAXATION - - (48,168)
(LOSS)/PROFIT FOR PERIOD £(152,741) £(98,640) £176,184
(Loss)/Earnings per share (25.46)p (16.44)p 29.36p

   

HYDRO HOTEL, EASTBOURNE, PLC
STATEMENT OF FINANCIAL POSITION
AT 30 APRIL 2017
30 April   2017 30 April     2016 31 October 2016
(Unaudited) (Unaudited) (Audited)
£ £ £
FIXED ASSETS
Tangible Assets 2,628,907 2,508,779 2,459,247
CURRENT ASSETS
Stocks 37,312 37,034 33,863
Debtors 126,184 90,482 138,621
Investment – 6 month notice deposit account 200,000 - -
Cash at bank and in hand 779,955 1,010,370 1,391,644
1,143,451 1,137,886 1,564,128
CREDITORS
Amounts falling due within one year (614,919) (477,808) (587,195)
NET CURRENT ASSETS 528,532 660,078 976,933
TOTAL ASSETS LESS
CURRENT LIABILITIES 3,157,439 3,168,857 3,436,180
PROVISION FOR LIABILITIES (71,811) (79,312) (71,811)
NET ASSETS £3,085,628 £3,089,545 £3,364,369
CAPITAL AND RESERVES
Called up share capital 600,000 600,000 600,000
Revaluation reserve 424,046 428,325 424,046
Profit and loss reserves 2,061,582 2,061,220 2,340,323
£3,085,628 £3,089,545 £3,364,369

   

HYDRO HOTEL, EASTBOURNE, PLC
STATEMENT OF CASH FLOWS
FOR THE HALF YEAR ENDED 30 APRIL 2017
Half year to    Half year to Year ended
30 April    2017 30 April 2016 31 October 2016
(Unaudited) (Unaudited) (Audited)
£ £ £
NET CASH (USED IN)/INFLOW FROM OPERATING ACTIVITIES                    (Note 1) (157,760) (70,361) 416,814
NET CASH GENERATED (USED IN)/FROM INVESTING ACTIVITIES                      (Note 2)   (411,929) 465,900 431,999

   

FINANCING ACTIVITIES
Dividends paid (42,000) (36,000) (108,000)
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (611,689) 359,539 740,813
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 1,391,644 650,831 650,831
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD £779,955 £1,010,370 £1,391,644
RELATING TO:
Cash at bank and in hand £779,955 £1,010,370 £1,391,644

   

HYDRO HOTEL, EASTBOURNE, PLC
NOTES TO THE STATEMENT OF CASH FLOWS
FOR THE HALF YEAR ENDED 30 APRIL 2017
Half year to Half year to Year ended
30 April 2017 30 April   2016 31 October 2016
(Unaudited) (Unaudited) (Audited)
£ £ £
Note 1
CASH FLOWS FROM OPERATING
ACTIVITIES
(Loss)/profit after tax (152,741) (98,640) 176,184
Adjustments for:
Taxation - - 48,168
Depreciation 86,794 88,666 169,171
Loss/(profit) on disposal of fixed assets 7,679 3,556 7,742
Interest receivable (4,048) (6,178) (10,695)
OPERATING CASH FLOW BEFORE WORKING CAPITAL CHANGES (62,316) (12,596) 390,570
MOVEMENTS IN WORKING  CAPITAL
(Increase) in stocks (3,449) (7,845) (4,674)
Decrease/(increase) in debtors 12,437 38,481 (9,658)
(Decrease)/increase in creditors (104,432) (88,401) 70,847
Income taxes paid - - (30,271)
NET CASH (USED IN)/GENERATED FROM OPERATING ACTIVITIES £(157,760) £(70,361) £416,814

   

Note 2

INVESTING ACTIVITIES
Purchases of tangible fixed assets (215,977) (40,278)      (79,184)
Proceeds on disposal of tangible fixed assets - -            488
Interest received 4,048 6,178       10,695
(Payment for)/proceeds from other investments (200,000) 500,000     500,000
NET CASH FLOW (USED IN)/GENERATED FROM INVESTING ACTIVITIES £(411,929) £465,900   £431,999

   

HYDRO HOTEL, EASTBOURNE, PLC
NOTES TO THE ACCOUNTS
1 The results are prepared on the basis of the accounting policies set out in the Company’s Annual Report and Accounts for the year ended 31 October 2016.
2 The earnings per share are based on a loss of £152,741 (2016 loss £98,640) being the loss on ordinary activities after taxation.
3 The movement in retained Profit and loss reserves from £2,340,323 at 31 October 2016 to £2,061,582 at 30 April 2017 includes the loss for the period and dividends of £126,000 (£42,000 paid in the period and £84,000 accrued).
4 Creditors, amounts falling due within one year, include a dividend for the year ended 31 October 2016 declared by the directors and paid on 4 May 2017 at the rate of 14p per share of £84,000 (2016 12p per share £72,000).
5 A copy of the interim report and accounts and the Chairman’s statement thereto, which were approved by the Board of Directors on 11 July 2017, will be posted to all registered shareholders shortly thereafter.
6 The financial information set out above does not constitute statutory accounts as defined in section 434 of the Companies Act 2006.  Statutory accounts for the year ended 31 October 2016, on which the report of the auditor was unqualified and did not contain a statement under section 498 of the Companies Act 2006, have been filed with the Registrar of Companies.
7 The company’s auditor, Mazars LLP, has not reviewed these unaudited interim accounts.

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