Annual profits at UK-based Peel Hotels fell by more than £400,000, the company reported today.

Pre-tax profits for the year to January 29 came in at £575,387 against £993,607 in the previous 12 months.

The company had to bear an exceptional expense of £170,500 to its profit due to a charge for “back land rent” at the Strathdon Hotel in Nottingham.

However, revenue per available room across the group was maintained with occupancy down 3.2% and average room rate up 3.4%

Turnover was down by 1.3% to £16.8 million and earnings [EBITDA] before exceptional expense fell by 2.5% to £2.25 million.

Net debt was down by £580,087 to £9.5 million.

Chairman Robert Peel said: “It is very difficult to forecast the current year’s outcome as so much depends on staycation and increased tourist activity stimulated by the weak pound.”

Refinancing with Allied Irish Bank and repayment of a director’s loan and loan notes “will provide significant savings in the costs of finance and the subsequent benefits of improved cash flow and lessening net debt,” he added.

The company spent more than £710,000 in the year, including the restructuring of certain bedrooms at the Crown and Mitre in Carlisle.

Conference and banqueting facilities have been refurbished at the George Hotel in Wallingford while bedroom refurbishment continues at the Caledonian in Newcastle.

“We continue to invest in our internet access throughout all our hotels giving our guests faster connection. This service is absolutely free to our guests and is a vital component to them having a satisfactory stay with us,” Peel said.

A further £661,317 was spent on repairs and renewals “which help us ensure that we are constantly and consistently maintaining and improving our product, proof of which is the continuing improvements in ratings of each hotel assessed by the Automobile Association”.