BY?MID-YEAR Neal & Massy will reveal what it has planned for its struggling Almond Resorts investment which reported staggering losses of $20 million last year.
Gervase Warner, chief executive officer of the Trinidad and Tobago-based regional conglomerate, conceded that the local hotel brand has been a drag on the group’s profits, and Neal & Massy as well as Almond shareholders “want us to find a solution”.
Neal & Massy gained 51 per cent ownership of Almond after its takeover of Barbados Shipping & Trading (BS&T) – the largest shareholderin Almond Resorts – in 2008. In an interview in Port-of-Spain last week while attending the Arthur Lok Jack Distinguished Leadership & Innovation Conference, Warner said Almond Resorts expanded from two to five hotels under management but the timing could not have been worse.
“That was a big stretch for the management team and . . . those hotels opened into the worst tourist season Barbados has seen – even worse than [after] 9/11.
“So not only did you have finance cost incurring because money was borrowed to open these hotels, but now we had operating losses,” Warner told BARBADOS BUSINESS AUTHORITY in an exclusive interview.
“Over the course of the last two years, going on three years, those operating losses have continued. While the banks have been supportive, it is a really fortunate thing that Neal & Massy became the 51 per cent owner of Almond Resorts because I shudder to think what would have happened if they were on their own.
“If [Almond Resorts] were on their own, they would not have been able to sustain themselves,” he added.
He pointed out that commercial banks continued to extend credit to the hotel group on the strength of its Neal & Massy ownership. Further funding was also provided by the parent company.
“We are in the middle of a process now of restructuring, looking for a sustainable solution for those hotels. We are not at the point where we have the answer but we are are exploring all options and getting closer to the answer. Give us another three to four months and we will be able to share with you the full restructuring plan,” he added.
