Resort Hotels will fail to post accounts: No reason given for decision

RESORT HOTELS, the company that called in accountants to investigate financing issues last July, will not deliver its accounts for the year ended 30 April at its annual meeting called for 31 December.

It would not say why, merely commenting that it would not be in a position to present the accounts.

At the time an unspecified firm of accountants was called in and the shares were suspended at 45p, it was thought that suspension was called for after Resort breached a banking covenant on the basis of interest cover or gearing.

Tim Baldwin, an analyst at Greig Middleton, estimated gearing at more than 100 per cent.

More recently, bankers to the company, led by National Westminster and Midland, have approached Talisman Management International, a management consultancy, in an attempt to save the company.

During 1992 Resort's shares fell from 90p to 16p as the market worried about the planned acquisition of two business expansion scheme- funded hotel groups, County and Country Resort Hotels. Resort had contracted to buy them after the BES schemes matured.

According to Mr Baldwin, Resort had paid the equivalent of pounds 100,000 a room for County, the larger of the two. He thought pounds 60,000 a more realistic valuation.

The industry, in general, has recently witnessed a sharp write- down in the value of rooms in four star hotels to about pounds 54,000.

Resort paid pounds 4.25m in shares for County and took on debt of almost pounds 30m. The chain of hotels made a pounds 3m operating loss in 1992. The Country group of hotels cost pounds 17m and made a pounds 600,000 loss.