THE owner of 12 Perth hotels has acknowledged they need extensive refurbishment to remain competitive against “newer and more modern establishments”.
The prediction was among a raft of bad news that ASX-listed Compass Hotel Group delivered to its shareholders this week.
The company reported a half-year loss of $3.4 million, after writing down the value of its assets by $5.1 million.
In the previous half year, Compass lodged a net profit of $1.77 million. The lower profit was on the back of a 9 per cent slump in revenue for the half-year to $29.9 million.
The company also disclosed that it was in breach of its banking covenants.
Its portfolio of 12 hotels, bought in 2007, include the Carine Glades Tavern, the Albion Hotel, The Peninsula Tavern and the Peel Alehouse.
“All operating venues require extensive refurbishment and this investment is considered critical to improve revenues and operating performance,” the company said.