Hastings directors paint doomsday scenario as group swings to huge losses
ITS latest set of accounts has laid bare the destructive impact the Covid pandemic has had on the north's biggest hotel group Hastings, with sales halving on the previous year and millions of pounds in profits plundered from its bottom line
The figures cover up to October 31 last, meaning more than seven months of its trading year came in lockdown, when its rooms, bars and restaurants lay empty and hundreds of staff were either laid off or furloughed.
The Hastings management had warned a year ago that it anticipated "continued disruption in the months ahead".
But even they could not have envisaged the severity of the devastation on its accounts, which came on the back of a record-breaking 2018/2019, and led to the directors considering the prospect of the group not continuing as a going concern.
Hastings Group's turnover during the year slumped by 49 per cent from £49.4 million to £25.1 million, which includes an impairment charge of £5.3 million related to a write-down on tangible assets.
It also swung from an operating profit of £6.6m in 2019 to a loss of £13.4m last year - an eye-watering decline of 301 per cent.
The group, which owns and operates seven venues across the north including Belfast's Grand Central and Europa Hotels as well as the Slieve Donard in Newcastle and Culloden near Holywood, also says its net assets dwindle from £50.7m to £33.4m. That is less than its current borrowings of £47.6m.
Occupancy levels at Hastings properties, like virtually every hotel, plummeted to historic lows in the midst of the Covid pandemic, forcing it to take immediate action to reduced costs and preserve cash.
The accounts filed at Companies House show that, over the year, overall staff numbers fell by more than 200 to 1,161 (full-time roles went from 644 to 498 and part-timers from 741 to 663). As a consequence, the overall wages bill fell by nearly £3 million (down from £17.2m to £14.2m).
In a statement with the accounts the directors say: "We remain focused on managing the business appropriately through the current challenging period and also ensuring we are positioned to emerge strongly as our markets recover from the Covid pandemic.
"We anticipate continued disruption to travel in the months ahead, though forward visibility on the timing and shape of improvements in demand remains limited."
They say they look forward to reopening their hotels on May 24 in line with government guidelines, though this still remains an indicative rather than firm date.
The directors reveal that they have considered a number of scenarios as part of Hastings' future-looking cash flow forecasts.
And ominously, they warn: "There can be no certainty on these outcomes, and in the event that they are not achieved in the expected time frame, the group and company may not be able to meet its liabilities as they fall due.
"This creates material uncertainty that may cast significant doubt on the group's and company's ability to continue as a going concern."