Apr 2012 Financial News

Hotel closing?

Apr 04, 2012

AT least 500 employees of Almond Beach Village could be on the breadline come month end. That’s because the St. Peter based hotel is closing unless a lifeline is offered to prevent that from happening.

Shareholders attending a meeting yesterday were told by Gervase Warner, CEO of Neal and Massy Holdings Limited, owners of Almond Resorts Incorporated (ARI), that a decision was taken by the Board of Directors to close the property because of the losses it continues to chalk up.

Warner said they had done everything possible to keep the hotel doors opened. According to reports, he said the measures included further extension to a Scotiabank loan. However, good will had run out and the bank decided there will be no more extensions to the loan after April 30, this year.

Shareholder equity was said to be falling fast, declining from $111 million at September 2010 to $12 million by December last year, said Warner who chaired the meeting. However, Warner said that any proposal similar to one highlighted by the union and workers to buy into the hotel to save it , would be considered once there was financial backing.

Two shareholders who attended yesterday’s meeting called by the Almond Board of Directors, said the announcement of the proposed closure, came as a surprise to them. “I know that ARI Group was having problems and we were hearing about buyers but this decision to close is really a shock,” one of the shareholders told the Barbados Advocate.

He also indicated that there should be some involvement in this by government since Almond is a major player in the local tourism industry.

The other said he too did not expect this “finality to the Almond Beach Village.”

“I came to this meeting expecting to hear about options, but was confronted with this news,” he declared. The shareholder said that the action will be a blow to the local tourism industry unless Government or someone else intervenes in the matter. He said he had expected to hear whether Jamaican Hotelier, Gordon ‘Butch” Stewart was going to buy one of the properties, as was suggested in some quarters. There was also speculation that the Elegant Group would have been buying one of the other properties within the ARI Group. “Nothing was said about these, although no one asked,” he pointed out.

Managing Director Ralph Taylor also addressed the shareholders at the meeting. He traced the development of the Almond properties but noted that the difficulties confronting the hotel stemmed from the global economic downturn which came on the heels of an expansion programme undertaken by the Group.

Opposition MP Mia Mottley was also there and made a brief intervention from the floor.

The meeting was called to alert shareholders about the status of negotiations for the sale of the properties, to explain to them the delays in releasing the annual financial statements for the period to September last year and for the first quarter to December last year as well, and the status of a loan from Scotiabank.

More than 50 shareholders attended the meeting which lasted at least three hours. (JB)


Source:
Barbados Advocate
Wednesday April 4, 2012

http://www.barbadosadvocate.com/newsitem.asp?more=business&NewsID=23865