P ARK PLAZA HOTELS
Annual Report 2007
P ARK PLAZA  HOTELS
room  
for growth Contents and introduction
Contents
Strategy statement and financial highlights  1
Park Plaza Hotels at a glance 2
Chairman’s statement 6
President and CEO’s statement and operational review 8
Strategic plan and development 12
Market review 16
Board of Directors 20
Corporate governance 21
Major shareholders 24
Corporate social responsibility 25
Showcase 07 28
Financial statements 38
Auditors’ report 87
Notice of AGM 88
Useful contacts 89
Welcome to Park Plaza Hotels. This is our first 
Annual Report as a listed company but our 
experience – and success – in every aspect of 
hotel ownership and management dates back 
to 1989. Today Park Plaza Hotels & Resorts, 
and our distinctive art’otels, are recognised 
centres of stylish and affordable luxury 
accommodation.  Strategy statement  
and financial highlights
Our objective is to become the leading 
hotel owner/operator in the four-star 
deluxe and boutique hotel markets in 
Europe, the Middle East and North Africa.
In 2007 we made considerable progress in achieving that goal. Highlights of the year included:
• 24.4% growth in EBITDA
1
 to €28.4 million
• An increase in Group revenues
1
 by 10% to €97 million 
• Floatation on the London Stock Exchange’s Alternative Investment Market (AIM), which raised 
£85 million before costs through a placing with new institutional investors
• Expansion of the Group’s portfolio, including acquisition of a hotel in Nuremberg and signing 
of a franchise agreement for a hotel in Marrakech
• Product improvement with refurbishments in Berlin, Eindhoven and Amsterdam
• A year-end cash and cash equivalent balance of €120 million, providing the flexibility to expand 
our hotel portfolio 
• Development of a Group-wide training programme, Connect!, designed to help employees 
internalise the ethos that makes our hotels uniquely appealing to existing and prospective guests
Post balance sheet progress in 2008 has been notable for: 
• Opening of the Park Plaza County Hall London
• Acquiring full ownership of the Park Plaza Westminster Bridge London project, destined to 
become one of Europe’s largest and best conference hotels
• Joint venture to develop an art’otel in Hoxton, London
• Ownership stake in, and management of, Arenaturist – one of Croatia’s leading hospitality 
companies with 2,800+ rooms 
• Joint venture to develop 15 to 20 Park Plaza Hotels in Russia within the next four years
1 Like for like, un-audited proforma results. 
Park Plaza Hotels Annual Report 2007   1   2007
2006
€97.0m
€88.2m
Park Plaza Hotels at a glance
Key figures
A dramatic and exciting year for the Group has 
resulted in some impressive financial figures. 
The highlights are as follows:
The Group
The Group owns, operates and franchises 
hotels in major cities and regional centres in 
Europe, the Middle East and North Africa.
The majority of our hotels are branded Park 
Plaza Hotels & Resorts or art’otel. Each brand 
attracts a different segment of the growing 
number of travellers in both the business and 
leisure sectors who seek high standards of style 
and service at attractive rates.
– 39 hotels in operation with a total of more 
than 7,300 rooms
– Access to one of the industry’s most 
powerful reservation, distribution and 
marketing systems through our strategic 
partnership with Carlson Hotels Worldwide, 
the world’s ninth largest hotel company*
– Strong development pipeline with 5,700+ 
rooms under development in exciting 
destinations such as London, Cologne, 
Nuremberg, Marrakech and leading 
Russian locations
* Source: HOTELS Magazine – Corporate 300 Ranking July 2007.
Revenue generated 
Like for like, un-audited proforma results
€97.0m
IPO funds generated 
£85m
1
2
3
4
5
6
7
8
1
2
3
4
5
6
7
2007
2006
€28.4m
€22.8m
EBITDA  
Like for like, un-audited proforma results
+24.4%
Rooms in operation, by country  
  2008  
 2007 First quarter
1 Germany 1,250 1,250
2  United Kingdom 1,478 1,876
3 The Netherlands 666 666
4  Hungary 165 165
5  Israel 180 180
6  Ireland 155 155
7  Belgium 229 229
8  Croatia – 2,810
Total 4,123 7,331
2007
2008
First quarter
2   Park Plaza Hotels Annual Report 2007 Our hotels
A dynamic, successful and developing hotel 
owner/operator with breadth and depth.
Germany
Park Plaza Prenzlauer Berg Berlin
Park Plaza Wallstreet Berlin
art’otel berlin mitte
art’otel berlin city center west
art’otel berlin kudamm
art’otel potsdam
Park Plaza Dresden
art’otel dresden
Park Plaza Trier
United Kingdom
Park Plaza Victoria London
Park Plaza Riverbank London
Park Plaza Sherlock Holmes London
Park Plaza Nottingham
Park Plaza Leeds
Park Plaza Cardiff
Park Plaza Belfast
The Netherlands
Park Plaza Victoria Amsterdam
Park Plaza Vondelpark Amsterdam
Park Plaza Utrecht
Park Plaza Mandarin Eindhoven
Hungary
art’otel budapest
Israel
Park Plaza Orchid Tel Aviv
Ireland
Park Plaza Tyrrelstown Dublin
Belgium
Park Plaza Astrid Antwerp
New developments
Our goal is to double the number of rooms to  
over 8,000 by 2010 and we are well on target 
to achieving this.
2008 first quarter developments
New openings
Park Plaza County Hall London, U.K.
Management of, ownership stake in, Arenaturist’s  
eight hotels and five aparthotels in Croatia
2009 – 2012 developments
Franchise agreements
Park Plaza Marrakech, Morocco (due to open mid-2009)
art’otel marrakech, Morocco (due to open mid-2009)
Development projects
Redevelop former hotel in Nuremberg, Germany
art’otel cologne, Germany
Monumental office building in Amsterdam,  
The Netherlands
Park Plaza Westminster Bridge London, U.K.
art’otel hoxton, London, U.K.
Joint venture with Ferens Management Ltd to 
develop 15 to 20 Park Plaza Hotels in Russia
Acquisition programme
Rebranding hotels in key locations: Paris, Rome, 
Milan and Barcelona as well as Scandinavia and 
central and eastern Europe.
1
2
3
4
5
6
8
9
10
7
Projected rooms in operation, by country – 2012 
1  Germany 1,635
2  United Kingdom 3,063
3  The Netherlands 766
4  Hungary 165
5  Israel 180
6  Ireland 155
7  Belgium 247
8  Croatia 2,810
9  Morocco 184
10  Russia 4,000
Total 13,205
Park Plaza Hotels Annual Report 2007   3   Park Plaza Hotels at a glance
The brands
Three brands with unique appeal
The Park Plaza Hotels & Resorts brand (part of Carlson Hotels Worldwide) to which we  
have exclusive rights in 56 countries, consists of full service hotels. Each is ideally located at  
the heart of its city’s business and cultural life. Thanks to a design-led approach, guests’ first 
impressions of stylish and welcoming lobbies are confirmed by guestrooms notable for space, 
distinctive décor and state-of-the-art facilities. Park Plaza Hotels & Resorts average 150 to 500 
rooms and suites. Carlson is further strengthening the Park Plaza Hotels & Resorts brand by 
developing contemporary hotels in key travel destinations such as Bangkok, Beijing and Shanghai. 
Our art’otels – a brand which we acquired in July 2007 – are unique. Each showcases the  
work of a single contemporary artist, such as Andy Warhol, Georg Baselitz and Donald Sultan. 
art’otels are destination lifestyle hotels where modern interiors blend with contemporary art. 
They are carefully sited in the best neighbourhoods for shopping and culture.
The Group’s three Chino Latino bars and restaurants offer a refreshing fusion of exotic  
cocktails and contemporary pan-Asian cuisine – all in lively and glamorous settings. Adjuncts to 
our hotels in London, Leeds and Nottingham, they have become highly popular local destinations 
in themselves. 
4   Park Plaza Hotels Annual Report 2007 Recent awards and recognition include:
– Finalist ‘Best Business Accommodation <50 hotels’ – 2008 Business Travel Awards 
Park Plaza Hotels
United Kingdom and Ireland
– AA Hotel of the Year 2006/2007, Wales   
Park Plaza Cardiff 
– U.K.’s Number 1 Conference Hotel – BDRC Venue Verdict Awards 2007  
Park Plaza Cardiff
– Best New Hotel – Hospitality Ireland Awards 2007 
Park Plaza Tyrrelstown Dublin 
– ‘Rosettes’ – recognition of quality of restaurant awarded at: 
 Park Plaza Victoria London
 Park Plaza Cardiff
 Park Plaza Sherlock Holmes London
– Best London Conference Venue 2007 – Conference and Incentive Travel Magazine 
Park Plaza Riverbank London 
– Best Large U.K. Hotel – Bronze Award 2007 – Visit London 
Park Plaza Riverbank London 
–  Official 5-star AA Rating   
Plaza on the River – Club and Residence, London
–  Best Oriental Restaurant 2007 – Nottingham Restaurant Awards  
Park Plaza Nottingham’s Chino Latino Restaurant and Bar 
– Winner of Best Restaurant Award 2007 – Eat Japan 
Chino Latino Restaurant and Bar
Germany and Hungary
– Best Bookings – Expedia award  
art’otel berlin city center west
– 3rd Best Hotel – Expedia Insider’s Select List 
art’otel budapest
– Top 100 Best Value Hotels 2008 – TripAdvisor 
art’otel budapest
Park Plaza Hotels Annual Report 2007   5   Impressive performance 
provides a platform for growth
Chairman’s statement
Eli Papouchado
6   Park Plaza Hotels Annual Report 2007 Even as an international hotelier of long-
standing, I am impressed and pleased by the 
performance of Park Plaza Hotels in 2007. 
As the success of the Group’s mid-year IPO 
on AIM indicated, my confidence in the future 
of Park Plaza Hotels is widely shared. 
In this brief message I would like to focus on the strengths 
that enabled us to have such a good year – and allude to 
the strategies that will result in the Group’s continuing 
success in the years ahead. 
Having two distinct hotel brands within our Group 
has certainly been in our favour. During 2007 both 
brands benefited from the continuing growth in European 
travel among business people and holiday-makers alike. 
Hotels within our full service Park Plaza Hotels & Resorts 
brand, with their extensive range of meeting rooms and 
conference facilities as well as recreational facilities, bars 
and restaurants have continued to attract new guests and 
retain previous visitors across both the executive and 
leisure sectors. At the same time, our Group’s art’otels, 
targeted at a sophisticated audience who appreciate 
staying in places in tune with local culture, have gained 
from the increase in short-haul European travel, including 
weekend city breaks. Operation of two distinct yet 
complementary brands provides us with maximum 
market flexibility. 
Guests who stay at our hotels once tend to revisit. 
But there is always the challenge of getting them across 
our thresholds in the first place. One major advantage 
is our close link with the global operations of Carlson 
Hotels Worldwide and its popular goldpointsplus
sm
 
loyalty scheme. Thanks in part to this, combined with 
involvement in carefully-selected airline and travel agent 
loyalty programmes, we have increased our 2007 
occupancy rate to 82.4% – considerably higher than 
the average for the regions in which we operate. 
Historically, our integrated approach to hotel and 
brand ownership has proven to be beneficial. Thanks 
to seamless hotel management and franchise services, 
we have availed ourselves of a number of market 
opportunities. For example, the Group’s acquisition, 
development and operation of flagship hotels such as 
the Park Plaza Victoria Amsterdam and the Park Plaza 
Riverbank London have led to important joint venture 
developments. These have included the Park Plaza 
Westminster Bridge London project, which will be one 
of Europe’s largest conference hotels on completion in 
2010. Park Plaza Westminster Bridge London, in turn, 
gave rise to other opportunities for the Group, such as 
management of what became the Park Plaza County Hall 
London nearby.
Further afield, the Group has also expanded Park Plaza 
Hotels & Resorts and art’otel franchise opportunities 
into new areas such as Morocco and the Gulf States. 
Such arrangements are particularly attractive, since they 
generate revenues and increase brand awareness without 
significant capital expenditure. 
Looking ahead, my fellow Directors and I are confident 
in the scope for growth. 
Expanding our two primary brands will cater for the 
growing demand for affordable luxury. We are doing this 
by increasing target customer awareness in Europe, the 
United States and in the emerging economies. At the 
same time, we are continuing to drive topline growth 
through further affiliation programmes with airlines and 
other partners. Operational efficiencies, such as the new 
management structure we initiated in 2007, are helping us 
to service the larger portfolio of properties we plan. 
We are also growing through carefully targeted 
acquisitions and new joint ventures in western European 
cities. Scrutiny of other markets in Eastern Europe and the 
Middle East could suggest other cities for expansion.
Of course, central to the Group’s success are the efforts 
of the 2,000 employees who make our hotel guests feel so 
consistently welcome and appreciated. Though our senior 
managers and staff supply the framework with superbly 
designed and equipped facilities, it is our employees who 
make our offering come alive through their dedication, 
enthusiasm and thorough understanding of what makes 
our hotels different. Everyone who works for Park Plaza 
Hotels has our admiration and our thanks. 
Our thanks, too, go to Park Plaza Hotels’ shareholders 
– many of whom joined us via our AIM listing in 2007. 
Through their investments, they have expressed tangible 
confidence in the Group’s unique vision and our ability 
to inspire our guests through individuality and passion. 
Our aim is to repay that confidence in kind through 
outstanding performance.
Sincerely,
Eli Papouchado
‘ Looking ahead, my  
fellow Directors and  
I are confident in the  
scope for growth.’
Park Plaza Hotels Annual Report 2007   7   Making the most  
of great potential
President and CEO’s statement  
and operational review
Boris Ivesha
8   Park Plaza Hotels Annual Report 2007 In our first year as a publicly traded company 
on AIM, it is best to begin by letting our 
financial indicators speak for themselves:
– Total revenue
1
 for the year increased by 10% to €97 
million. This reflected good performance throughout 
the Group, including a RevPAR rise of 6.1% from the 
previous year to €97.10. This increase is mostly due 
to improvements in average room rates in our two 
most important markets: the United Kingdom and 
the Netherlands.
– In the United Kingdom we achieved a RevPAR of 
€144.60 for the full year, up 13.7%. In the Netherlands, 
our RevPAR was €112.50, an increase of 8.4% – a result 
attributable to an average room rate increase of 
6.8% while maintaining an occupancy rate of 90%. 
– Group EBITDA
1
 increased by 24.4% to €28.4 million 
thanks to strong performance in particular from our 
hotels in the United Kingdom and the Group’s hotel 
management operations. These successes more than 
offset challenging conditions in Germany and Hungary.
As we stated when the Group applied for admission 
to AIM, we intend to retain our earnings and make the 
most of a strong balance sheet to grow our portfolio. 
Therefore, we do not anticipate paying any dividends 
during the 18-month period that began with our AIM 
listing on 17 July, 2007. Instead, our priority is to 
concentrate investing our time and efforts on expanding 
our portfolio of hotels, making the most of the Group’s 
exciting brands and improving operations in terms of 
guest experience and efficiency. 
We are doing this from a position of strength, as our 2007 
results demonstrate. 
The Group’s structure, with its two distinct hotel brands, 
allows for complete flexibility. Park Plaza Hotels & 
Resorts, which is a part of Carlson Hotels Worldwide, 
allows us exclusive rights in 56 countries in Europe, the 
Middle East and North Africa. In addition, are those 
properties that are part of our own brand, art’otel. Both 
operate in the mid-to upscale market segment but attract 
their own styles of business and leisure travellers.
The Group’s link with Carlson Hotels Worldwide adds 
another dimension to our business model. It provides 
access to Carlson’s large-scale and highly effective 
reservation, distribution and marketing system. This 
partnership grants Park Plaza Hotels several benefits 
usually confined to much larger organisations: economies 
of scale, operating experience, enhanced negotiating 
power and global reach. 
To maximise these benefits and capture others, in 2007 
we devised and successfully implemented a new yield 
management system throughout key portfolio properties. 
As a result, we can now make better use of historic data, 
analyse trends and optimise our pricing. This improves 
management forecasting ability and drives top line 
growth. Our hotels are also fully engaged in the new 
global Carlson goldpointsplus
SM
 guest reward 
programme, which covers 965 locations in 71 countries. 
With its newly centralised and enlarged database, the 
system provides improved benefits to cardholders – 
and to us.
To widen our client-base even more, in 2007 we 
negotiated agreements with 14 frequent flyer 
programmes, a welcome addition to the five agreements 
already in place. We now have partnerships with the 
world’s main carriers such as KLM/Air France, Lufthansa, 
British Airways, American Airlines, United Airlines, JAL 
and Cathay Pacific. Again, these relationships have 
substantially increased our reach to potential guests 
the world over.
Sincerely,
Boris Ivesha
‘ The Group’s structure,  
with its two distinct  
hotel brands, allows for 
complete flexibility.’
1 Like for like, un-audited proforma results.
Park Plaza Hotels Annual Report 2007   9   10   Park Plaza Hotels Annual Report 2007 the bigger picture
At all Park Plaza Hotels & Resorts – 
and at our art’otels in particular – style 
is substance. It’s not just about creating 
exciting environments that intrigue and 
amuse our guests. Equally important 
is the attention paid to every detail to 
ensure that our properties provide a 
total experience that bears repeating.
Off the wall—and on. We have specialists 
dedicated to acquiring sculptures and 
paintings for our hotels. Art for art’s sake? 
No. Their efforts are part of building our 
distinctive brand. 
Park Plaza Hotels Annual Report 2007   11   Strategic plan and development
As a Group, Park Plaza Hotels’ objective 
is straightforward: to become the leading 
hotel owner/operator in the four-star deluxe 
and boutique hotel markets in Europe, 
the Middle East and North Africa. We are 
achieving this aim by building on our key 
strengths through the implementation of a 
two-pronged strategy focusing on internal 
and external growth. 
Enabling internal growth
Within our existing portfolio, we are pursuing several 
main paths to achieve our growth objectives. 
Driving top growth: We are driving top growth by making 
the most of our existing assets. This means maximising 
occupancy and average room rates in all our hotels. 
Again, our links with affiliation programmes associated 
with airlines and other partners play an important part in 
this process. So will further use of and implementation of 
our new yield management system, Optims, which allows 
us to use historic data for forecasting and establishing 
pricing. With this knowledge, we can set room rates to 
our best advantage. 
At the same time we are expanding our sales, marketing 
and public relations efforts. In particular, our growing 
team of 100 sales representatives will improve existing 
relationships, develop new links with major corporate 
customers and establish new preferred status 
arrangements with referral partners. We are also making 
better use of our brand websites with their user-friendly 
reservation systems. Top growth and increased profitability 
will also come from our food and beverage revenues – 
particularly in our full service Park Plaza Hotels & Resorts. 
These exert a strong attraction for business travellers and 
corporate event planners. To that end, we will renew our 
focus on conference trade and banqueting and continue 
the rollout of our own branded outlets such as Chino 
Latino restaurants and Mix Espresso Gourmet cafés.
Maintaining operational efficiency: We are confident 
that the Group’s current corporate structure can service a 
considerably larger portfolio. This will provide us with the 
flexibility to take advantage of opportunities as they arise 
– whether to expand our operations or to increase returns 
from our existing portfolio of properties. 
Raising brand awareness: Our aim is to further 
raise brand awareness among existing and potential 
guests in Europe, the U.S. and the emerging economies. 
We will do this by leveraging our relationship with 
third parties – foremost among them Carlson, with 
its highly sophisticated Central Reservations System, 
the goldpointsplus
sm
 guest reward scheme and the 
Our strategy for growth
Look To Book
®
 travel agent loyalty programme. 
Our newer links with the frequent flyer schemes of 
19 leading airlines such as KLM/Air France, Lufthansa, 
British Airways and their partners will also raise our brand 
profiles.On top of these efforts, we will make judicious 
use of our own carefully targeted advertising campaigns, 
online marketing initiatives and customer relations and 
database management tools.
Continuously differentiating our product  
and improving quality
Equally important are our efforts to make employees 
aware of what sets our hotels apart. The newly launched 
Connect! training programme, rolled out in early 2008, 
is an important part of that effort. Based on a ‘reverse 
thinking’ model, these one-day interactive workshops 
focus on the primacy of guest experience rather than the 
traditional hotel model of creating a product and hoping 
it attracts custom. By mid-year, all 2,000 staff and 
contractors at every level will have benefited from attending 
workshops – with each individual fully committed to 
anticipating guest needs and exceeding guest expectations. 
Expanding through external growth
Equally exciting are the prospects to expand our 
business model through carefully considered external 
deals. These can take a variety of forms: acquisitions, 
joint ventures and developments; operating leases; 
management contracts; and franchising arrangements. 
Each has its benefits and each can be compatible with 
our brand philosophy.
Filling the pipeline: 
Acquisitions, joint ventures and developments
In keeping with our stated goal of doubling the number 
of Park Plaza Hotels & Resorts and art’otel rooms by 
2010, we have embarked on a vigorous acquisition 
programme. This means looking for properties of the right 
calibre in the right locations at the right price. Specifically, 
this will involve re-branding hotels in European gateway 
cities that include Paris, Rome, Milan and Barcelona, sites 
in Scandinavia and in certain central and eastern European 
cities including Vienna, Prague and Moscow.
Development projects are also a way forward. 
For example, we gained valuable experience through 
the Group’s involvement in the Park Plaza Riverbank 
and Plaza on the River – Club and Residence London 
development. For this project, we jointly acquired a prime 
Thames-side city-centre site and succeeded in getting 
planning permission for a 460-room/suite hotel with 
spacious conference facilities. Since opening in 2005, the 
hotel has benefited from the demand we anticipated and 
earned several important awards in the process. In 2007 
an independent valuation put the hotel’s worth at €218 
million, of which our share is worth €120 million. Our 
total investment in the project had been €78.6 million. 
12   Park Plaza Hotels Annual Report 2007 Our plan is to embark on future ventures of this kind 
either independently or as part of a consortium with 
existing or new partners. Our projected art’otel in 
Hoxton, London illustrates this approach. Other recent 
acquisitions include a former hotel in Nuremberg, a 
monumental office building in Amsterdam and an 
ownership stake in Arenaturist in Croatia. 
Operating leases: Another way to increase our portfolio 
of Park Plaza Hotels & Resorts and art’otel branded 
properties is through operating leases. These require 
less up-front capital investment than straightforward 
acquisition or development. However, they can expose 
the Group to possible rent increases and exclude 
participation in any future increase in property value. 
Therefore, we will only enter into operating leases on 
a selective basis that limits any liabilities.
Management contracts: Managing hotels for others can be 
an attractive and profitable way of expanding our brands. 
However, since competition for such contracts is often 
fierce, there is a temptation for owners to negotiate fee 
deferral arrangements or guaranteed returns. Fortunately, 
the strength of our brands gives us a negotiating advantage 
in such arrangements. Moreover, those owners for whom 
we currently provide management services are so pleased 
with the result that they are often inclined to come straight 
to us for work on other properties as well. That is how we 
were awarded the management contract for the Park Plaza 
County Hall London. 
Franchising arrangements: These relationships enable 
us to expand our brands with minimal capital investment 
or risk. That is why our aim is to expand the roster of 
franchising arrangements currently in place in Cardiff, 
Berlin, Trier, Belfast, Dublin and Tel Aviv. To that end, 
we have entered into territorial franchise arrangements 
in Northern Ireland, the Republic of Ireland, Morocco, 
Egypt and the Gulf States. Our latest franchise 
agreements for hotels in Marrakech and the Gulf States 
are early results of this strategy. 
Delivering on our promise 
The Group’s AIM application was absolutely clear about 
our intention to more than double the number of rooms 
in the portfolio to over 8,000 by 2010. In 2007 – and the 
early part of 2008 – we laid the groundwork for not just 
meeting our development targets, but exceeding them. 
In Germany, for example, two projects are underway.
In the ancient university city of Nuremberg, we have 
applied for planning permission to refurbish a newly 
acquired hotel. This property perfectly fits our location 
criteria. It is in the heart of a bustling shopping and 
business centre within easy reach of public transport. 
Our plan there is to create a 175-room Park Plaza Hotel.
In Cologne, one of Germany’s great commercial cities, 
construction has started on an art’otel. Leased and 
managed by the Group, this will form a key part of the 
city’s midtown Reinau Port development in the historic 
old town alongside the Rhine.
We acquired – with a partner – a monumental office 
building in 2006, next to Park Plaza Victoria Amsterdam. 
In 2007 we applied for planning permission to convert 
this into a 100-bedroom hotel. 
Beyond Europe, in December 2007 we announced the 
signing of a franchise agreement with Global V Hospitality 
Inc. This will lead to the opening of North Africa’s first 
Park Plaza Hotel in Marrakech, one of Morocco’s 
most-visited cities. This hotel will add 114 rooms to 
our portfolio. 
In 2007 we also laid the groundwork for a number of 
further developments. We announced early 2008 that we 
would increase our ownership share to 100% of the 
prestigious new Park Plaza Westminster Bridge London 
project. Due to open in 2010 with management provided 
by Park Plaza Hotels, this apart-hotel will have 1037 
apartments and is destined to become one of Europe’s 
largest and most contemporary conference hotels.
The Park Plaza County Hall London added 398 rooms 
to our portfolio when it opened on 01 February 2008. 
Both occupancy rates and guest feedback have since 
been encouraging. Park Plaza Hotels manages this 
outstanding development.
Having had such success with the Park Plaza Hotels & 
Resorts brand in London, we are now embarking on the 
city’s first art’otel. In March, we announced a joint 
venture agreement with Aldersgate Investments Limited, 
the property vehicle of the Reuben Brothers, to develop 
and manage a property in Hoxton, which has become one 
of the city’s most creative quarters. In keeping with the 
ambience of the neighbourhood, we have plans for an 
art gallery, two showing rooms for cult films, a range of 
restaurants and bars – as well as several hundred rooms.
In Croatia, we acquired an ownership stake in – and 
management of – Arenaturist, one of the country’s 
leading hospitality companies with more than 2,800 
rooms. The investment in Arenaturist is in partnership 
with Goldman Sachs.  
In Russia, which is emerging as one of the world’s most 
exciting markets for quality hotels, we embarked on a 
joint venture with Ferens Management Limited (part of 
the leading developer the Renova Stroygroup) to develop 
between 15 and 20 Park Plaza Hotels in key locations over 
the next four years. 
Overall, the Group’s progress in 2007 and our 
achievements to date in 2008 are encouraging. Although 
it is early in the year and there are uncertainties in the 
economic environment, we are confident that our current 
portfolio of hotels and pipeline of opportunities leave us 
well-positioned for further growth in the near future 
and beyond.
Park Plaza Hotels Annual Report 2007   13   14   Park Plaza Hotels Annual Report 2007 well connected
Other connections, such as with Carlson’s 
award-winning Look To Book
®
 travel agent 
reward scheme and airline frequent flyer 
partnerships, provide us with considerable 
marketing advantages at minimal costs.
Our guests certainly are, with high speed 
internet access and all they need to keep 
in touch with home or office. And so 
are we, thanks to links with the Carlson 
network and its global Central Reservation 
System and guest reward schemes such 
as goldpointsplus
sm
. 
Park Plaza Hotels Annual Report 2007   15   Market review
Park Plaza Hotels has the exclusive license 
from Carlson Hotels Worldwide to operate 
Park Plaza Hotels & Resorts in 56 countries. 
The potential of our art’otels is global. 
But for now, our primary focus is on four of 
the most dynamic economies of the European 
Union: the United Kingdom, Germany, the 
Netherlands and Hungary. The Group’s 
business model, with its built-in flexibility, 
will allow us to shift our emphasis over time 
to emerging markets as well as key European 
gateway cities. 
Meanwhile we are well positioned to benefit 
from the existing situation. In our first year as 
an AIM-listed company, we made considerable 
progress in our objective to become the leading 
hotel owner/operator in the four-star deluxe 
and boutique hotel markets in Europe, the 
Middle East and North Africa.
The Group’s EBITDA
1
 increased by 24.4% in 2007 to 
€28.4 million, reflecting robust activity from our existing 
hotel portfolio. At the same time we had a number of 
development projects underway – several signed in the 
past six months – that will help us surpass our stated 
goal of doubling the number of rooms in our portfolio 
to 8,000 by 2010. These new developments include 
properties in London, Nuremberg and Cologne, 
franchise agreements in Marrakech, and – most 
recently – expansion in Croatia and Russia. 
Total revenue
1
 for the year increased by 10% to 
€97 million from €88.2 million in 2006 – the result 
of good performance throughout the Group. Overall 
RevPAR increased by 6.1% to €97.10 from RevPAR 
€91.60 the previous year. 
Putting our  
performance in context
A growing market in the United Kingdom
The London market, which accounts for about half of the 
Group’s revenues, was strong in 2007, though there was 
a slight slowdown in business during the second half. 
Throughout, we benefited from increased market share 
and higher room rates, which had a positive impact on 
our United Kingdom RevPAR which increased by 13.7% 
to €144.60 for the full year. In contrast, our RevPAR in 
2006 was €127.30. Thanks to improvements to our 
London central reservations office, we also increased the 
level of direct, non-commissionable business. Strategic 
use of third-party websites resulted in significant growth 
in weekend occupancy rates. 
The only area in which performance fell below 
expectations was in conferencing and banqueting 
in the United Kingdom, which accounts for over a quarter 
of our revenues in this country. To improve this situation, 
we appointed a new management team whose objective 
is to concentrate on all-important corporate bookings 
and the period leading up to Christmas. We are already 
on track to deliver stronger conferencing and banqueting 
results this year.
Rising to challenges in Germany and Hungary
Early 21st century Berlin has become one of the most 
exciting cities in Europe. This has led to an oversupply of 
hotel rooms, with over 2,000 rooms opened in our price 
sectors during the course of the year. The result has been 
increased competition which has had an impact on both 
room rates and occupancy levels, particularly in West 
Berlin. We are dealing with this by determinedly growing 
our corporate business and limiting our exposure to 
discounted pricing in the leisure market. 
This strategy is working and so overall performance during 
2007 was broadly in line with the previous year’s. A small 
decline in average room rates was offset by a small increase 
in occupancy. RevPAR for the period did, however, reflect 
the highly competitive environment, with a slight reduction 
to €51.70 from the previous year’s €52.40. 
1 Like for like, un-audited proforma results.
16   Park Plaza Hotels Annual Report 2007 We aim to improve the Group’s performance in 
Germany through tighter cost controls, management 
improvements and refurbishments as appropriate to 
make our hotels the most appealing in the market. This 
process has already begun. In August 2007 we completed 
modernisation of 133 rooms and all the public areas at 
our art’otel berlin kudamm. Three months later we 
started work on refurbishing the art’otel berlin mitte 
in the historic city centre. This project, which involves 
renovation of 109 rooms and suites as well as banqueting 
facilities and meeting rooms is due for completion by the 
middle of 2008.
In Hungary, the Budapest market has proved to be 
equally competitive. Nevertheless, our art’otel budapest 
showed further signs of recovery in the second half of 
the year.
A capital benefit in the Netherlands
The Dutch hotel market remains one of Europe’s most 
vigorous and our performance there more than kept 
pace. We achieved RevPAR growth of 8.4%, largely 
attributable to a climate healthy enough to absorb a 6.8% 
increase in average room rates to €126.80. Building on 
occupancy rates already in excess of the market average, 
we managed to achieve an overall rate for the year of 
88.9% thanks to the high quality of our guest offering. 
Our local team deserves full credit for this achievement.
One of our key properties in the Netherlands is the Park 
Plaza Victoria Amsterdam. It gained market share 
and benefited from both increased occupancy and 
higher  room rates. At our Park Plaza Vondelpark, also in 
Amsterdam, we achieved good progress on a major 
refurbishment programme. The first phase was 
completed in September. Inevitably, the closure of one 
third of the hotel’s rooms during the summer had an 
impact on profitability. However, the high standards we 
are bringing to the hotel have already become apparent 
and we are confident that it will become a guest favourite.
Another refurbishment began in November 2007 at the 
Park Plaza Mandarin in Eindhoven, where 60 rooms and 
all the public areas have since been transformed. The 
hotel became fully operational again in February 2008.
Poised for further growth 
Group profit before tax
1
 was €22.1 million, in contrast 
to a loss the previous year of €4.7 million. This figure 
includes profit of €9.2 million from the sale of our 50% 
shareholding in Andrássy 25 Kft., a joint venture owning 
one property in Hungary. It also includes a negative 
goodwill adjustment of €13 million that resulted from the 
difference in the sale and purchase price of the Park Plaza 
Group before the July AIM IPO and the value of the Group 
at floatation. Without these items, the Group would have 
reported a marginal pre-tax loss in 2007.
Completion of the Group’s IPO provides Park Plaza 
Hotels with a strong platform from which to grow our 
portfolio. As of December 31, 2007, net debt was €86.5 
million, with cash and cash equivalents of €120 million.
We indicated at the time of the IPO that we intend to 
retain earnings for use in the business – and to help it 
grow – for 18 months following our AIM listing. That still 
holds true, though the Board will keep this policy under 
review in light of growth opportunities that may become 
available during that period.
1 Like for like, un-audited proforma results.
Park Plaza Hotels Annual Report 2007   17   rest easy
Anyone can provide guests with basic bed 
and breakfast. But giving them an experience 
that’s simultaneously stimulating and restful 
is a more complicated proposition altogether. 
It demands wit, attention to detail and, above 
all, a commitment to quality. But Park Plaza 
Hotels carries it off consistently, competitively 
– and profitably. 
And we are doing it more widely than 
ever before. Recent deals have more 
than doubled the number of rooms we’ll 
be operating by 2010, expanding our 
operations beyond existing hotels in 
Europe, the Middle East and North Africa 
to take in new properties in Croatia and 
Russia as well. 
18   Park Plaza Hotels Annual Report 2007 Park Plaza Hotels Annual Report 2007   19   1 2
5
3 4
Board of Directors
Eli Papouchado 05 December 1937
Non-Executive Chairman of the Board
Date of appointment 26 June 2007
Eli Papouchado is the founder of the Red Sea Group 
and was Chairman of its Board for ten years. He has 
been involved in the construction, design, development, 
financing, acquisition and management of leading hotels, 
including the Park Plaza Riverbank London, Park Plaza 
Victoria London, Park Plaza Leeds, Park Plaza 
Nottingham, Park Plaza Victoria Amsterdam and the 
milestone Taba Hotel. Mr. Papouchado was involved in 
the development of hundreds of thousands of square 
metres of retail space in shopping malls and large 
residential projects in the United States, Eastern Europe 
and the Middle East. He also served as Chairman of the 
Israeli Hotel Association. Mr. Papouchado is Chairman 
of the Investment and Operational Committees.
Boris Ivesha 08 October 1945
President and Chief Executive Officer
Date of appointment 14 June 2007
Boris Ivesha has been the President of Park Plaza Hotels 
Europe since 1991. In 1972 he was appointed General 
Manager of the Royal Horseguards Hotel in London, 
a position he held until 1979, when he became a 
Managing Director for the Carlton Hotel in Israel. 
Mr. Ivesha established the Yamit Hotel in 1984, served 
as the hotel’s President and brought the Park Plaza 
Hotels & Resorts brand to the Group in 1994 in 
collaboration with the Red Sea Group. Mr. Ivesha has 
been one of the major drivers behind the expansion of 
the Group’s portfolio. He sits on the Investment and 
Operational Committees.
Chen Moravsky 11 November 1970
Chief Financial Officer
Date of appointment 14 June 2007
Chen Moravsky was Financial Director of the Red Sea 
Group before joining Park Plaza Hotels Europe in 2005. 
Mr. Moravsky worked as an Audit Manager at Deloitte. 
He joined the Red Sea Group in 2001, where he gained 
his expertise in the hotel/leisure business and real estate 
investment market. Mr. Moravsky is a Certified Public 
Accountant (ISR) and holds an MBA from The University 
of Manchester as well as a Bachelor of Business from 
the Tel Aviv College of Management. He sits on the 
Investment and Operational committees.
Kevin McAuliffe 12 June 1957
Non-Executive Director
Date of appointment 15 June 2007
Kevin McAuliffe has been the Chief Executive of Carey 
Group since 1999, prior to which he was Head of 
Advisory Services for Paribas International Private 
Banking operations. In 1994 he was appointed Chief 
Executive of Ansbacher, a Guernsey bank and trust 
company, having worked for the Ansbacher Group since 
1980 during which he held the position of Finance 
Director as well as being a director of other banks held 
by the Ansbacher Group. From 1973-1980, he held posts 
in three different departments in the State of Guernsey. 
He is a Member of the Society of Trust and Estate 
Practitioners and a director of various companies, 
including U.K. Care No. 1 Limited.
Nigel Jones 04 December 1961
Non-Executive Director
Date of appointment 26 June 2007
Nigel Jones was the Chief Executive Officer of ComProp 
Limited, an AIM listed property company. Mr. Jones’s 
directorships include U.K. Care No. 1 Limited, Matrix 
Property Fund Management (Guernsey) Limited and 
Threadgreen Industrial Limited. In 1995, Mr. Jones 
founded Jones & Partners Limited. Mr. Jones has been a 
member of the Royal Institution of Chartered Surveyors 
since 1989.
Elisha Flax 18 February 1962 – not pictured
Non-Executive Director
Date of appointment 26 June 2007
Elisha Flax is a real estate entrepreneur engaged in 
various property activities in Eastern Europe. Mr. Flax 
is currently a Non-Executive Director of Delek Global 
Real Estate plc, an AIM-listed company. Mr. Flax was 
previously employed as a solicitor at the London offices 
of U.S. law firms Chadbourne & Parke and Akin, 
Gump, Strauss, Hauer & Feld and general counsel at 
PlaneStation Limited. Mr. Flax holds an LLB degree 
from Keio University in Tokyo, Japan and is a qualified 
solicitor in England and Wales.
Board of Directors
1 Eli Papouchado 
Non-Executive Chairman  
of the Board
2 Boris Ivesha 
President and  
Chief Executive Officer
3 Chen Moravsky  
Chief Financial Officer
4 Kevin McAuliffe 
Non-Executive Director
5 Nigel Jones  
Non-Executive Director
20   Park Plaza Hotels Annual Report 2007 Corporate governance
Park Plaza Hotels’ pursuit of excellence extends 
to corporate governance as well as hospitality. 
For example, as a closed-ended investment 
company registered in Guernsey, the Company 
is eligible for exemption from the requirements 
of the Combined Code (the “Code”) issued 
by the United Kingdom Listing Authority. 
Nevertheless, we voluntarily comply with the 
main requirements of Code, which sets out 
principles of good governance and a code of 
best practice. We do this through a framework 
for corporate governance which the Directors 
believe is suitable for an investment company 
of our size and business activities. 
Consequently, the Board considers that the Company 
has complied with the provisions contained in Section 1 
of the Code throughout this accounting period. 
The Code recommends that the Board of Directors of 
a listed company should include a balance of Executive 
and Non-Executive Directors (and in particular Non-
Executive Directors) such that no individual or group of 
individuals can dominate the Board’s decision making. 
The Combined Code also recommends that the 
Chairman should, on appointment, be independent.
The Board
The Company currently has six Directors, four of whom are 
Non-Executives (including the Chairman Eli Papouchado). 
As recommended by the Combined Code, three of the 
Directors – Elisha Flax, Kevin McAuliffe and Nigel Jones 
– are regarded by the Company as being independent 
of management and free from any business or other 
relationship that could materially interfere with the 
exercise of their independent judgement. The Company’s 
Chairman, Eli Papouchado, is the founder of the Red Sea 
Group, the Company’s largest shareholder and is not 
therefore independent of the Company.
High standards,  
rigorously applied
The Board has responsibility for the Group’s strategic 
and financial policies and meets regularly.
All the Directors have access to the advice and services 
of the Company Secretary and are able to gain access to 
external independent advice, should they wish to do so.
The Board maintains an appropriate balance of Executive 
and Non-Executive members, all of whom receive regular 
and timely information concerning the activities of the 
Group. This information enables the Board to exercise 
its responsibilities and control functions in a proper and 
effective manner.
The Board has a breadth of experience relevant to the 
Company. The Directors believe that any changes to the 
Board’s composition can be managed without undue 
disruption. With any new Director appointed to the 
Board, consideration will be given as to whether an 
induction process is appropriate.
The Board considers agenda items laid out in the Notice 
and Agenda which are formally circulated to the Board 
in advance of the Meeting as part of the Board Papers. 
Directors may request any agenda items to be added 
that they consider appropriate for Board discussion. 
Additionally, each Director is required to inform the 
Board of any potential or actual conflicts of interest 
prior to Board discussion.
To date, the Board has not considered it necessary 
to have formal strategy sessions. This is because the 
investment strategy, which is set out in the Company’s 
prospectus, is reviewed regularly.
The primary focus at Board Meetings is a review of 
investment performance and associated matters. 
These include gearing and asset allocation as well as 
marketing, investor relations, risk management, general 
administration and compliance, peer group information 
and industry issues.
The Board evaluates its performance and considers the 
tenure of each Director on an annual basis. The Board 
believes that the current mix of skills, experience, ages and 
length of service are appropriate to the requirements of 
the Company.
Park Plaza Hotels Annual Report 2007   21   Directors’ duties 
The Directors have adopted a set of reserved powers, 
which establish the key purpose of the Board and detail 
its major duties. These duties cover the following areas 
of responsibility:
• statutory obligations and public disclosure
• strategic matters and financial reporting
• risk assessment and management, including 
reporting, monitoring, governance and control
• other matters having material effects on the Company
The Directors have adopted these reserved powers of the 
Board to demonstrate the seriousness with which the 
Board takes its fiduciary responsibilities. These powers 
also enable ongoing means of measuring and monitoring 
the effectiveness of Board actions.
Directors’ responsibilities
The Directors are required to prepare the Directors’ 
Report and the financial statements for each financial 
year. These must give a true and fair view of the state of 
affairs of the Company as at the end of the financial year 
and of the profit or loss for that year. In preparing annual 
financial statements, the Directors are required to:
• select suitable accounting policies and apply them 
consistently
• make judgements and estimates that are reasonable 
and prudent
• state whether applicable accounting standards have 
been followed, subject to any material departures 
disclosed and explained in the financial statements 
• prepare the financial statements on the going-concern 
basis, unless it is inappropriate to presume that the 
Company will continue in business
The Directors are responsible for keeping proper 
accounting records which disclose with reasonable 
accuracy at any time the financial position of the 
Company and to enable them to ensure that the financial 
statements have been properly prepared in accordance 
with The Companies (Guernsey) Law, 1994. They are also 
responsible for safeguarding the assets of the Company. 
This involves taking reasonable steps for the prevention 
and detection of fraud and other irregularities.
Board Committees
In accordance with best practice for corporate 
governance, the Group has established Committees 
to act on its behalf in overseeing and dealing with audit, 
remuneration, nominations, investment and operations.
The Audit Committee comprises Kevin McAuliffe 
(Chairman), Elisha Flax and Nigel Jones and meets at 
least three times a year. The Committee assists the Board 
in observing its responsibility for ensuring that the 
Group’s financial systems provide accurate and up-to-
date information on its financial position and that the 
published financial statements represent a true and fair 
reflection of this position. The Committee also assists the 
Board in ensuring that appropriate accounting policies, 
internal financial controls and compliance procedures are 
in place. The Audit Committee receives information from 
the Company Secretary and from the external auditors.
The Remuneration Committee comprises Kevin 
McAuliffe (Chairman) and Elisha Flax. The Committee 
advises the Board on an overall remuneration policy and 
meets at least twice a year. It also determines, on behalf 
of the Board, and with the benefit of advice from external 
consultants, the remuneration packages of the Executive 
Directors. The Board determines the remuneration of the 
Non-Executive Directors.
The Nominations Committee comprises Elisha Flax 
(Chairman), Nigel Jones and Kevin McAuliffe. Whenever 
possible, all Non-Executive Directors attend its meetings 
as well. The Committee carries out the selection process 
for the appointment of candidates to the Board and 
propose names for approval by the full Board.
The Investment Committee comprises Eli Papouchado 
(Chairman), Boris Ivesha, Chen Moravsky and Elisha Flax. 
The Committee assesses and approves new projects in 
accordance with an agreed approval process. It is also 
responsible for carrying out post-investment appraisals.
The Operational Committee comprises Eli Papouchado 
(Chairman), Boris Ivesha, Chen Moravsky and Elisha 
Flax. It develops and implements the overall operations 
strategy. The Committee also determines the framework 
of the Operational Board and monitors its activities.
Corporate governance
continued
22   Park Plaza Hotels Annual Report 2007 Internal controls
The Board is ultimately responsible for the Company’s 
system of internal control and for reviewing its 
effectiveness. The Board confirms that there is an ongoing 
process for identifying, evaluating and managing the 
significant risks faced by the Company. This process has 
been in place for the period under review and up to the 
date of approval of this Annual Report and Accounts. 
The Board reviews this process, ensuring it accords with 
appropriate corporate governance codes. On at least an 
annual basis, the Directors conduct a review of the 
Company’s system of internal control. This covers all 
controls, including financial, operational, compliance 
and risk management.
The Board has reviewed the effectiveness of the system 
of internal control. In particular, it has reviewed and 
updated the process for identifying and evaluating the 
significant risks affecting the Company and the policies 
by which these risks are managed.
Corporate responsibility
The Company keeps abreast of regulatory and statutory 
changes and takes appropriate action.
On an annual basis, the Chairman assesses the 
performance of each Director. This assessment includes 
a review of Board and Committee meeting attendance.
Going Concern
After making enquiries, and given the nature of the 
Company and its investments, the Directors are satisfied 
that it is appropriate to continue to adopt the going-
concern basis in preparing the Financial Statements. 
After due consideration, the Directors consider that the 
Company is able to continue in the foreseeable future.
Relations with shareholders
Board members will be available to respond to 
shareholders’ questions at the Annual General Meeting.
Major shareholders are contacted directly on a regular 
basis.
The Company formally reports once a year to 
shareholders, who receive a proxy voting card with the 
Annual Report and Financial Statements. Additionally, 
current information is provided to shareholders on an 
ongoing basis through the Company website. The 
Registrar monitors the voting of the shareholders and 
proxy voting is taken into consideration when votes are 
cast at the Annual General Meeting. Shareholders may 
contact the Directors via the Company Secretary.
Park Plaza Hotels Annual Report 2007   23   Major shareholders
Major shareholders
Shareholder enquiries
For information about the management of 
shareholdings please contact our registrar
Shareholder Services 
Capita Registrars 
34 Beckenham Road
Beckenham
Kent BR3 4TU
United Kingdom
Email: ssd@capitaregistrars.com
Tel: U.K. 0871 664 0300
Calls cost 10p per minute plus network extras.
Tel: Overseas +44 208 639 3399
Investor relations enquiries
Chen Moravsky 
Chief Financial Officer 
Hasselaerssteeg 11
1012 MB Amsterdam
The Netherlands
Tel: +31 (0) 20 713 8200
Fax: +31 (0) 20 524 0651
Email: cmoravsky@pphe.com
Website
Annual Reports, half year reports and share information 
are all available on our website www.parkplazahotels.net
Financial calendar
Financial year: 1 January to 31 December
Earnings releases: 30 June, 31 December
Annual General Meeting held on 30 June, 2008
London Stock Exchange trading code: PPH.L
Ownership of Group shares 
  No. of Percentage of issued 
Name shares share capital
1 Red Sea Group 17,376,900 42.44%
2 Molteno Limited 7,500,000 18.32%
3 Goldman Sachs Group 4,751,364  11.61%
4 Nortrust Nominees Limited 3,767,184 9.20%
5 Chase Nominees Limited 2,931,500  7.16%
6 Vidacos Nominees Limited 2,737,663 6.69%
1
2
3
4
5
6
24   Park Plaza Hotels Annual Report 2007 Corporate social responsibility
A shared journey
People will always need to travel. That is 
the basis – and future – of our business. 
But there is a price to pay for travel that 
includes environmental and social costs as 
well as the bill on check out. Increasingly, our 
guests understand this and we are responding 
by working to principles set out in a Corporate 
Social Responsibility (CSR) programme that 
demonstrates an enthusiastic commitment to 
the environment and society. In real terms, this 
means making a positive contribution to local 
communities (which includes being a good 
employer) and minimising our own impact on 
the environment as well as our guests’ while 
they are with us. 
TREE takes root
For Park Plaza Hotels, CSR is an essential business 
process. And like every business process it needs 
management. To do that, we have devised TREE. 
Inspired by the Park Plaza Hotels & Resorts logo, 
TREE stands for Total Responsibility for Everyone’s 
Environment. 
TREE’s objective is to research, develop, produce, 
implement and communicate our CSR aims. Starting 
in 2006 and during the course of 2007, the TREE team 
looked into individual hotel CSR initiatives and helped 
to determine which best practices could effectively be 
applied more widely. At the same time, the TREE team 
worked to identify and correct any irresponsible activities 
or behaviours. 
Working closely with the United Kingdom Government-
sponsored Carbon Trust and Envirowise, TREE developed 
an ‘aims grid’ to establish objectives, define responsibilities, 
devise measurement criteria and determine results. 
To ensure that TREE was developing an appropriate 
CSR policy that encompassed all Park Plaza Hotels’ best 
practices, a multi-national, multi-disciplinary team of 
senior people from throughout the Group formed a 
project team to review all CSR initiatives.
Commitment to the power of 10
The TREE team has done its work well and the Group now 
has commitments (mandatory) and initiatives (optional) 
in place that cover ten operating areas. Individual hotels 
and Park Plaza Hotels as a whole can make a real 
difference through these commitments.
By having some policies that are mandatory and others 
that are optional, we recognise the individual nature of 
our hotels, yet ensure a consistent minimum level of 
commitment throughout the Group. 
Though TREE’s accomplishment is considerable, its task 
is far from over.
Since CSR is a dynamic discipline, we recognise that our 
policies will constantly evolve, develop and intensify to 
reflect changes in our environment and the industry in 
which we operate. 
Meanwhile, our efforts are already being recognised with 
a Considerate Hoteliers Association Award in the ‘highly 
recommended’ class for energy conservation and a Green 
Tourism Award.
Future indicative
The Group’s newest hotel in London, the Park Plaza 
Westminster Bridge London, is due for completion in 
2010. It provides an excellent indication of what other 
Park Plaza Hotels’ projects may be like in future.
Our biggest development to date, Park Plaza 
Westminster Bridge London is specifically designed to 
limit any negative impacts on the environment, contribute 
to urban regeneration and make a positive impact on the 
surrounding community.
Park Plaza Hotels Annual Report 2007   25   For example, the project got off to an environmentally 
sound start by recycling some of the concrete salvaged 
from the demolished building on site (which had 
the dubious distinction of being voted London’s ugliest 
structure). 
When complete, the building will benefit from an on-site 
water bottling plant based on a carbon filter process that 
will eliminate the need to transport and dispose of an 
estimated one million bottles of water per year. Park Plaza 
Westminster Bridge London is also using the latest 
building insulation technology with triple-glazed, energy 
retaining cladding for heat and cold retention to ensure 
maximum energy efficiency year-round. On top of this, 
the hotel is projected to meet a substantial proportion of 
its own energy needs by producing power using a biomass 
electric generator. 
A key part of the overall regeneration programme for 
London’s South Bank, the Park Plaza Westminster Bridge 
London is dedicating several million pounds to local 
projects for public transport, employment and training. 
Considerable funds have also been allocated to develop 
a landscaped public space around the hotel; helping to 
create a spacious piazza that is set to become a local 
attraction in itself. 
Partners for good
Of course, Park Plaza Hotels also realises the benefits of 
working with others to achieve CSR objectives. To that 
end, the Group is an active supporter of a number of 
organisations. The Willow Foundation, for example, 
organises and funds special days for young adults who 
are living with serious diseases such as cancer, cystic 
fibrosis and the later stages of multiple sclerosis. The 
Group’s President and Chief Executive Officer, Boris 
Ivesha, sits on the Foundation’s Board.
Through the Group’s links with Carlson, Park Plaza 
Hotels also supports the World Childhood Foundation, 
which addresses the social, emotional and material needs 
of children the world over. 
On the environmental front, the Group is helping 
guests to reduce their carbon footprints through 
an arrangement with Carbon Neutral. Through this 
initiative, members of the goldpointsplus
sm
 reward 
programme can redeem their Gold Points
®
 to benefit 
community-based carbon reduction products that 
balance out the equivalent CO 2 emissions associated 
with their travel. 
Corporate social responsibility
continued
AIMS table
Who Purpose End Result Success Criteria
• Employees of Park Plaza 
Hotels
• Customers
 – Guests
 – Bookers
• Owners/Stakeholders
• Suppliers
• Franchisees
• Reduce utility  
consumption
• Increase environmental 
responsibility
• Improve waste 
management
• Support the brand 
promise
• Support local community
• Meet legal requirements
• Produce a clear 
environmental 
statement/policy
• Communicate policy 
internally
• Communicate policy 
externally
• Policy adhered to 
throughout company
• Deliver end result within 
agreed timeframe
• Reduction in utility 
consumption
• Reduce hotel utilities cost
• Ensure project is 
recognised company 
wide
• Kite mark/accreditations
• Stakeholder feedback
26   Park Plaza Hotels Annual Report 2007 Corporate Social Responsibility table
Mandatory Optional
Water
• Sub-metering of all kitchen areas and fitness suites to better monitor use
• Inform guests of responsible water usage whilst in the hotel,  
e.g., towel change policy, running taps
• Preventative maintenance of all water systems to avoid leakages, 
dripping taps etc
• Ensure enforcement of water minimisation policy (defrosting, running 
water, water-efficient appliances etc)
• Passive infrared WC flush in public areas  
(all new builds)
• 6 litre cisterns used in all WC’s (restricted use)
• Dual flush consideration
Electricity
• Each hotel to adopt the SEASON (Save Energy And Switch Off Now) 
policy and posters to be printed in all back of house areas
• Energy-saving light bulbs in all areas where appropriate and physically 
possible
• E-cubes to be fitted, where appropriate, in all refrigeration appliances  
to regulate temperature and reduce energy usage
• Energy saver key-card switch in all guest rooms (power activated by key 
card only) in all new and renovated hotels
• Sub-metering to better monitor use and application of SEASON for all 
new build hotels and refurbishments
• Building Management System (BMS) for all new build hotels or 
refurbishments to maximise efficiency of equipment
• Movement sensors in all public areas where 
appropriate (automated on/off switch) 
including fire exits
• Solar/wind turbine for provision of electricity
Heating
• Review of energy efficiency by certified organisation such as MK Energy 
Service in the U.K.
• All service pipes to be insulated
• Energy efficient boilers for all new build hotels
• Sub-metering to better monitor use
• Ensure enforcement of gas water minimisation policy
• Consideration of SCOTMAS product with 
water temperature regulator and purification
Purchasing
• The CSR credentials of all suppliers to be reviewed (including utilities)
• Work with suppliers to minimise transport miles, e.g., use local suppliers
• Work with organic food suppliers where 
possible
• Reduce packaging on supplied goods
• Reduce number of deliveries to the hotel by 
suppliers on a weekly basis
Waste 
Management
• Glass, paper and general waste from offices, restaurants and public 
areas to be separated and effectively recycled
• All toners and batteries to be recycled and offered back to the supplier  
or donated to a charitable organisation for recycling
• Ensure all hazardous waste is disposed of in terms of local and national 
regulations, including all appropriate licences/register (ensuring 
compliance with legal standards)
• Soap dispensers to be installed in all public areas
• Waste reduction
 - Recycling of paper
 - E-mail signatures (don’t print unless you have to!)
• Installation of soap dispensers in guest rooms
• Cardboard bailing facility in order to reduce 
general waste
• Dual bins for recycling in guest rooms
Learning & 
Development
• Ensure CSR policy is fundamental part of all employee inductions
• Ensure SEASON is fully implemented across the business and with every 
member of staff
• Minimum twice-yearly review and audit of CSR policy and/or as 
legislation changes
• Each hotel to establish a CSR review team to ensure implementation  
and review of the policy
Community
• Each hotel to give 10 working days (either one day per 10 staff or 10 staff 
working one day together) to a local charity or community organisation 
of choice
• Each hotel to sponsor a local community project
• Encourage car sharing, use of public 
transport and cycling to work
• External partners to present to staff about 
general CSR policy
Charity
• Each hotel to support the Carlson charity of choice – World Childhood 
Foundation. Facility exists for guests to donate Gold Points
®
  
(loyalty reward programme) to charity
• Each hotel to support one local charity of their choice
• Donate unclaimed lost property to charity
• Choose one dish on the restaurant menu to donate £1 or €1 with  
every order
Corporate Travel
• Use public transport wherever possible (considering financial and time 
constraints)
Guest 
Communications
• Distribute CSR messages throughout the hotel where possible, such as 
TV, tent cards, lifts
• Include information about the CSR in the Guest Services Directory
• Publish CSR policy online for download
• Ability to reduce Carbon Footprint by redeeming Gold Points
®
• Any other communication to assist guests 
with conservation and environmental 
responsibility whilst in the hotel
• Card that gives guests tips on how to conserve 
whilst in the hotel
• Consider environmental impact of written 
communication
Park Plaza Hotels Annual Report 2007   27   In an increasingly  
competitive market,  
the most successful hotels  
are those that consistently  
and positively distinguish 
themselves from the rest  
– and then constantly  
re-invent themselves. 
At Park Plaza Hotels we 
understand this imperative 
and put it into practice with 
a design-led, service-oriented 
approach to hospitality 
wherever we do business. 
But such consistency doesn’t 
preclude individuality. Park 
Plaza Hotels & Resorts and 
art’otels are noted for their 
distinctive interiors and strong 
sense of place. Each is different 
and constantly evolving. Yet 
each remains distinctly us. 
 
P ARK PLAZA  HOTELS
Park Plaza County Hall London
SHOWCASE   07
28   Park Plaza Hotels Annual Report 2007 Light fantastic
Inspired by the magic of the 
Thames at night, the designers 
of the Park Plaza County Hall 
London on the south bank 
of the River Thames have 
made dramatic use of light 
throughout the 398-room 
hotel. One of the most striking 
examples is the appropriately-
named Spectrum Bar and 
Café, which provides a 
spectacular atrium setting 
for drinks or dinner. 
Park Plaza 
County Hall London
1 Addington Street
London SE1 7RY
+44 (0) 20  7021 1800 
Spectrum Bar & Café by night
Contemporary studio rooms
Park Plaza Hotels Annual Report 2007   29   art’otel berlin kudamm
30   Park Plaza Hotels Annual Report 2007 State of Fluxus
Berlin artist Wolf Vostell was 
a proponent of the Fluxus 
School of the 1960s, noted 
for its revolutionary blending 
of different media and 
disciplines. With an amusingly 
eclectic feel and signed Vostell 
lithographs in each of its 133 
guest rooms, the art’otel berlin 
kudamm is a contemporary 
homage to the artist and 
his period. 
art’otel berlin kudamm
Joachimstaler Strasse 28-29
10719 Berlin
+49 (0) 30 88 4470
Neutral décor complements dramatic artworks
Minimalist design, effective results
Park Plaza Hotels Annual Report 2007   31   Eastern appeal
Orange might be the national 
colour of the Netherlands, 
but at the Park Plaza 
Mandarin Eindhoven, the 
favoured fruit is of the eastern 
variety. That’s because in 
addition to 102 guest rooms, 
the hotel features three fine 
oriental restaurants with a 
contemporary twist echoed 
in Mandarin’s zen-like décor.
Park Plaza  
Mandarin Eindhoven
Geldropseweg 17
5611 SC Eindhoven
+31 (0) 40 214 6500
Modern zen interior
Park Plaza Mandarin Eindhoven
32   Park Plaza Hotels Annual Report 2007 Refreshing new space
Park Plaza Hotels Annual Report 2007   33   Park Plaza Victoria London
34   Park Plaza Hotels Annual Report 2007 First class 
arrivals and 
departures
Just steps away from one of 
London’s busiest mainline 
stations, the Park Plaza 
Victoria London has been 
designed to be a destination 
in its own right. The impressive 
contemporary foyer sets the 
scene for a restaurant serving 
modern European cuisine, 
a speciality coffee bar and 
299 deluxe rooms, suites 
and apartments. 
Park Plaza  
Victoria London
239 Vauxhall Bridge Road
London SW1V 1 EQ
+44 (0) 20 7769 9999
Clean modern lines
Unique artwork
Park Plaza Hotels Annual Report 2007   35   Park Plaza Wallstreet Berlin
36   Park Plaza Hotels Annual Report 2007 Capitalist cool
Where better to celebrate the 
spirit of free enterprise than 
in the city where communism 
crumbled so dramatically? 
The Park Plaza Wallstreet 
Berlin does just that. The 
167-room hotel, in the 
historic centre of the capital, 
is suitably well equipped for 
serious executive gatherings as 
well as more playful occasions. 
Park Plaza 
Wallstreet Berlin
Wallstrasse 23-24
10179 Berlin 
+49 (0) 30 847 1170
Bespoke design
Brighter meetings
Park Plaza Hotels Annual Report 2007   37   Consolidated financial statements
Consolidated balance sheet 39
Consolidated income statement 41
Consolidated statement of changes in equity  42
Consolidated statement of cash flow  43
Notes to the consolidated financial statements 46
Company financial statements 
Company balance sheet 78
Company income statement 79
Company statement of changes in equity  80
Company statement of cash flow 81
Notes to the Company financial statements 83
Appendices to the financial statements 
List of Group Companies, investments  
and joint ventures 85
Auditors’ report 87
Park Plaza Hotels Limited
Year Ended 31 December 2007
Euro in thousands
Financial statements 
38   Park Plaza Hotels Annual Report 2007 Park Plaza Hotels Annual Report 2007   39  
Consolidated balance sheet 
       As at 31 December
       2007  2006 
     Note  €’000  €’000
Assets
Non-current assets
Intangible assets     4  56,993 –
Property, plant and equipment     5  170,848 134,443
Prepaid leasehold payments     6  20,621 18,678
Investment in an associate     7  9,109 10,028
Other financial assets     8  3,707 4,346
        261,278 167,495
Current assets
Inventories       578 276
Trade receivables     9  10,634 3,273
Other receivables and prepayments     10  4,161 1,574
Short-term deposits       – 1,564
Restricted cash       646 1,021
Cash and cash equivalents     11  119,376 6,212
        135,395 13,920
Total assets       396,673 181,415
The accompanying notes are an integral part of the consolidated financial statements.
Adopted on: 15 May 2008.
Chen Moravsky, Chief Financial Officer.     Boris Ivesha, President and Chief Executive Officer. 40   Park Plaza Hotels Annual Report 2007
       As at 31 December
       2007  2006 
     Note  €’000  €’000
Equity and liabilities
Equity
Issued capital     12  – –
Share premium        195,894 14,401
Foreign currency translation reserve       (11,009) (3,332)
Hedging reserve       1,759 4,349
Accumulated deficit       (21,377) (28,675)
Total equity       165,267 (13,257)
Non-current liabilities
Bank borrowings     15  177,912 169,020
Other financial liabilities     16  2,607 618
Deferred income taxes     23  2,061 1,192
        182,580 170,830
Current liabilities      
Trade payables       4,502 4,903
Other payables and accruals     17  15,668 9,825
Bank borrowings     15  28,656 9,114
        48,826 23,842
Total liabilities       231,406 194,672
Total equity and liabilities       396,673 181,415
The accompanying notes are an integral part of the consolidated financial statements.
Consolidated balance sheet  Park Plaza Hotels Annual Report 2007   41  
       Year ended 31 December
       2007  2006 
     Note  €’000
1
  €’000
1
Revenues     18  75,039 48,852
Operating expenses     19  (44,503) (35,770)
EBITDAR       30,536 13,082
Rental expenses       (6,102) (1,165)
EBITDA       24,434 11,917
Depreciation and amortisation       (7,252) (5,180)
EBIT       17,182 6,737
Financial expenses     20  (20,831) (14,491)
Financial income     21  3,782 1,321
Share in profit/(loss) of an associate       (40) 85
Other income     22  22,184 –
Profit/(loss) before tax       22,277 (6,348)
Income tax expense (benefit)      23  (21) 1,555
Profit/(loss) for the year       22,298 (7,903)
Basic and diluted earnings/(loss) per share (in Euro)      0.78 (0.45)
1 (except earnings per share).
The accompanying notes are an integral part of the consolidated financial statements.
Consolidated income statement  42   Park Plaza Hotels Annual Report 2007
    Foreign    Total 
    currency    recognised 
  Issued Share translation Hedging Accumulated  income 
  capital premium reserve reserve deficit Total (expense)
Balance as at 1 January 2006  – 14,401 (3,007) (606) (20,772) (9,984) 
Change in fair value of hedging derivatives  – – – 4,955 – 4,955 4,955
Foreign currency translation adjustments  – – (325) – – (325) (325)
Loss for the year  – – – – (7,903) (7,903) (7,903)
Balance as at 31 December 2006  – 14,401 (3,332) 4,349 (28,675) (13,257) (3,273)
Cash dividend prior to IPO  – – – – (15,000) (15,000) –
Issue of shares upon acquisition of the Park Plaza Group  – 60,935 – – – 60,935 –
Issue of shares upon IPO on AIM  – 125,508 – – – 125,508 –
IPO expenses  – (9,018) – – – (9,018) –
Issue of shares to acquire art’otel rights  – 4,000 – – – 4,000 –
Change in fair value of hedging derivatives  – – – (2,590) – (2,590) (2,590)
Foreign currency translation adjustments  – – (7,677) – – (7,677) (7,677)
Share-based payments  – 68 – – – 68 –
Profit for the year  – – – – 22,298 22,298 22,298
Balance as at 31 December 2007  – 195,894 (11,009) 1,759 (21,377) 165,267 12,031
The accompanying notes are an integral part of the consolidated financial statements.
Consolidated statement of changes in equity Park Plaza Hotels Annual Report 2007   43  
       Year ended 31 December
       2007  2006 
       €’000  €’000
Cash flows from operating activities
Profit/(loss) for the year       22,298 (7,903)
Adjustment to reconcile profit/(loss) to cash provided by operating activities (a)    (17,466) 5,407
Net cash provided by operating activities       4,832 (2,496)
Cash flows from investing activities
Purchase of property, plant and equipment       (8,637) (11,797)
Net change in cash upon acquisition of the Park Plaza Group (b)     6,735 –
Net change in cash upon disposal of joint venture (c)      14,930 (1,628)
Decrease/(increase) in short-term deposits, net       3,459 (989)
Increase/(decrease) in restricted cash       375 (117)
Repayments of loans from jointly controlled entities       – 4,501
Loans to related parties       – (8,686)
Net cash provided by/(used in) investing activities       16,862 (18,716)
Cash flows from financing activities 
Proceeds from issuance of new shares       116,490 –
Dividend distribution       (15,000) –
Proceeds from long-term loans       720 134,997
Repayment of long-term loans       (3,068) (116,251)
Increase/(decrease) in short-term credit, net       67 (807)
Repayment of loans from related parties       687 (247)
Net cash provided by financing activities       99,896 17,692
Increase/(decrease) in cash and cash equivalents       121,590 (3,520)
Net foreign exchange differences       (8,426) 379
Cash and cash equivalents at beginning of year       6,212 9,353
Cash and cash equivalents at end of year       119,376 6,212
The accompanying notes are an integral part of the consolidated financial statements.
Consolidated statement of cash flow 44   Park Plaza Hotels Annual Report 2007
       Year ended 31 December
       2007  2006 
       €’000  €’000
(a) Adjustment to reconcile profit/(loss) to net cash provided by operating activities
 Gain on sale of investments       (9,148) –
 Negative goodwill on acquisition of Park Plaza Group      (13,036) 
 Share in loss/(profit) of an associate       40 (85)
 Provision for impairment        – 1,404
 Deferred income taxes       682 (29)
 Depreciation and amortisation       9,360 5,820
 Share–based payments       68 –
 Changes in operating assets and liabilities
 Decrease in other assets       – 676
 Increase in inventories       (65) (6)
 Decrease/(increase) in trade and other receivables      199 (466)
 Increase/(decrease) in trade and other payables      (5,566) (1,907)
        (17,466) 5,407
(b) Net change in cash upon acquisition of the Park Plaza Group
 Current assets (except cash)       (12,922) –
 Current liabilities       29,889 –
 Long-term assets       (112,734) –
 Long-term liabilities       28,531 –
 Fair value of the shares issued as consideration for acquisition     60,935 –
 Negative goodwill       13,036 –
        6,735 –
The accompanying notes are an integral part of the consolidated financial statements.
 
Consolidated statement of cash flow
continued Park Plaza Hotels Annual Report 2007   45  
       Year ended 31 December
       2007  2006 
       €’000  €’000
(c) Net change in cash upon disposal of joint venture
 Current assets (except cash)       307 11
 Current liabilities       (104) (1,096)
 Property       5,579 –
 Long-term liabilities       – (543)
 Gain on sale       9,148 –
        14,930 (1,628)
(d) Supplemental disclosure of cash flows
 Cash paid during the year
 Income taxes       294 259
 Interest       13,009 10,816
 Cash received during the year
 Interest        2,996 –
(e) Significant non-cash transactions
 Shares issued to acquire the Park Plaza Group       60,935 –
 Shares issued to acquire intangibles       4,000 –
The accompanying notes are an integral part of the consolidated financial statements. 46   Park Plaza Hotels Annual Report 2007
Note 1 General
a. The consolidated financial statements of Park Plaza Hotels Limited (“the Company”) for the year ended 31 
December 2007 were authorised for issuance in accordance with a resolution of the Directors on 15 May 2008.
b. Description of business and formation of the Company:
The Company was incorporated and registered in Guernsey on 14 June 2007.
The Company through its subsidiaries owns, operates, manages, and franchises hotels in Europe, the Middle East 
and North Africa under two primary brands: Park Plaza Hotels & Resorts and art’otel.
On 14 July 2007, the Company entered into an agreement to acquire the Euro Sea Group. For periods prior to the 
legal formation of the Company, the assets, liabilities, revenues and expenses of Euro Sea Group were consolidated 
in preparing the financial statements (see Note 2.a). Also on 14 July 2007, as part of the IPO described in Note 1c, 
the Euro Sea Group acquired 100% of the voting shares of Park Plaza Hotels Europe Holding B.V., its subsidiaries 
and other investments (“Park Plaza Group” see Appendix B). As of this date the assets, liabilities, revenues and 
expenses of the Park Plaza Group were included in the consolidated financial statements (see also Note 3).
c. On 17 July 2007, all of the Company’s Ordinary shares were admitted for trading on AIM of the London Stock 
Exchange. In addition, the Company completed an initial public offering (“IPO”) of 15,450,000 Ordinary shares, 
at a price of £5.50 per share (€8.125 at the exchange rate on the date of acquisition). The net proceeds received 
from the IPO amounted to €116.5 million (net of expenses of €9 million).
Note 2 Summary of Significant Accounting Policies
a. Basis of preparation:
The consolidated financial statements of Park Plaza Hotels Limited and all its subsidiaries (“the Group”) have been 
prepared in accordance with International Financial Reporting Standards (“IFRS”).
On 14 July 2007, the Company entered into an agreement to acquire the Euro Sea Group. The Euro Sea Group 
represents a group of companies under common control of the former controlling shareholder of the Company. 
These companies are principally engaged in the development, construction, management and operation of hotels 
in Europe.
In consideration for the acquisition of the Euro Sea Group, the Company issued 17,499,999 shares to the former 
shareholders of the Euro Sea Group. As this transaction involved the combination of businesses under common 
control, it is not a business combination in the scope of IFRS3, and the pooling of interests method of accounting 
has been applied in the presentation of the consolidated financial statements for the years ended 31 December 
2007 and 2006. Accordingly, the assets and liabilities of the Euro Sea Group transferred to the Company have been 
recognised at historical amounts. For periods prior to the legal formation of the Company, the assets, liabilities, 
revenues and expenses of the Euro Sea Group were consolidated in preparing the financial statements. The 
consolidated financial statements present the results and changes in equity of the Company and its subsidiaries as 
if the Group had been in existence throughout the years presented and as if the Euro Sea Group operations were 
transferred to the Company as of 1 January 2006.
The accounting policies used in preparing the consolidated financial statements for the years ended 31 December 
2007 and 2006 are set out below. These accounting policies have been consistently applied to the periods 
presented unless otherwise stated.
The financial statements have been prepared on a historical cost basis, except for derivatives which have been 
measured at fair value.
b. Presentation currency:
The financial statements are presented in Euro.
Notes to the consolidated financial statements Park Plaza Hotels Annual Report 2007   47  
c. Basis of consolidation:
The consolidated financial statements comprise the financial statements of the Group as at 31 December each year.
The financial statements of the subsidiaries are prepared for the same reporting year as the parent company, using 
consistent accounting policies. All inter-company balances and transactions, income and expenses, and profits and 
losses resulting from intra-Group transactions that are recognised in assets, are eliminated in full.
Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Group obtains control, 
and continue to be consolidated until the date that such control ceases. 
The Group has interests in hotels in the Netherlands, the United Kingdom, Germany and Hungary, through 
subsidiaries and jointly controlled entities. For details of the Group’s wholly-owned subsidiaries as at 31 December 
2007, see Appendix C.
For details of the Group’s interests in jointly controlled entities (proportionally consolidated as at 31 December 
2007), see Appendix D.
d. Changes in accounting policy and disclosures:
The Group has adopted the following relevant new and amended IFRS and IFRIC interpretations during the year. 
Adoption of these revised standards and interpretations did not have any effect on the financial performance or 
position of the Group. They did however give rise to additional disclosures.
IFRS 7 Financial Instruments: Disclosures
IAS 1 Amendment – Presentation of Financial Statements
IFRIC 8 Scope of IFRS 2
The principal effects of these changes are as follows:
IFRS 7 Financial Instruments: Disclosures
This standard requires disclosures that enable users of the financial statements to evaluate the significance of the 
Group’s financial instruments and the nature and extent of risks arising from those financial instruments. The new 
disclosures are included throughout the financial statements. While there has been no effect on the financial 
position or results, comparative information has been revised where needed.
IAS 1 Presentation of Financial Statements
This amendment requires the Group to make new disclosures to enable users of the financial statements to evaluate 
the Group’s objectives, policies and processes for managing capital. These new disclosures are shown in Note 31. 
IFRIC 8 Scope of IFRS 2
This interpretation requires IFRS 2 to be applied to any arrangements in which the entity cannot identify specifically 
some or all of the goods received, in particular where equity instruments are issued for consideration which appears 
to be less than fair value. As equity instruments are only issued to employees in accordance with the employee share 
scheme, the interpretation had no impact on the financial position or performance of the Group.
e. Use of estimates: 
IFRS require management to use estimates or assumptions regarding transactions or matters whose ultimate effect 
on the financial statements cannot be accurately determined at the time the financial statements are being 
prepared. Although the estimates and assumptions are made using the best judgment available, the final effect of 
these transactions or matters may differ from the relevant estimates or assumptions. 
f. Business combinations:
Business combinations, other than the Euro Sea Group transaction, are accounted for using the purchase method. 
Goodwill is initially measured at cost being the excess of the cost of the business combination over the Group’s 
share in the net fair value of the acquirer’s identifiable assets, liabilities and contingent liabilities. In the situation 
that the net fair value of the acquirer’s identifiable assets exceeds the cost of the business combination (negative 
goodwill), this excess is recorded in profit and loss as other income.  48   Park Plaza Hotels Annual Report 2007
g. Investment in an associate:
An associate is an entity over which the Company has significant influence and that is neither a subsidiary nor a joint 
venture.
Investments in associates are accounted for by the equity method. Under the equity method, the investments in 
associates are carried in the balance sheet at cost as adjusted by post-acquisition changes in the Group’s share of 
the net assets of the associate, less any impairment in the value of individual investments. The statement of 
operations reflects the share of the results of operations of the associates. The accounting policies of the associates 
conform to those used by the Group. As of 31 December 2007, the Company has an investment in one associate, as 
follows:
   Place of  Proportion of  Principal  
Name of company   incorporation ownership interest activity
Marlbray Limited   U.K. 33.3% Hotel company
h. Jointly controlled entities:
The Group reports its interests in jointly controlled entities using proportionate consolidation. The Group’s share 
of the assets, liabilities, income and expenses of jointly controlled entities are combined with the equivalent items in 
the consolidated financial statements on a line-by-line basis.
Where the Group transacts with its jointly controlled entities, unrealised profits and losses are eliminated to the 
extent of the Group’s interest in the joint venture, except to the extent that unrealised losses provide evidence of an 
impairment of the asset transferred.
i. Foreign currency translation:
The consolidated financial statements are presented in Euro which is the Group’s presentation currency. The 
functional currency of the Company is Great Britain Pounds. Each entity of the Group determines its own functional 
currency and items included in the financial statements of each entity are measured using that functional currency.
Transactions in foreign currencies are initially recorded at the rates of exchange prevailing on the dates of the 
transactions. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rates 
prevailing on the balance sheet date. Profits and losses arising from exchange differences are included in the 
income statement.
The assets and liabilities of the entities whose functional currency is other than the Euro are translated at exchange 
rates prevailing on the balance sheet date. Income and expense items are translated at the average exchange rates 
for the period. Exchange differences arising on the translation are classified as a separate component of equity 
(currency translation reserve). Such translation differences are recognised as income or as expenses in the period 
in which the entity is disposed of.
Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and 
liabilities of the foreign operation and translated at the closing rate.
The following exchange rates in relation to the Euro have been used at balance-sheet date:
       As at 31 December
       2007  2006 
         In Euro
Great Britain Pound       1.363 1.490
Hungarian Forint       0.004 0.004
 Percentage of increase/(decrease) in exchange rates during the year:
       31 December
       2007  2006 
         %
Great Britain Pound       (8.5) 2.2
Hungarian Forint       – –
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   49  
j. Intangible assets:
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets 
acquired in a business combination is fair value at date of acquisition. Following initial recognition, intangible 
assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. 
Intangible assets are amortised using the straight-line method over their estimated useful life and assessed for 
impairment whenever there is an indication that the intangibles may be impaired. The amortisation period and the 
amortisation method is reviewed at least at each financial year end. Changes in the expected useful life or the 
expected pattern of consumption of future economic benefits embodied in the assets is accounted for by changing 
the amortisation period or method, as appropriate, and are treated as changes in accounting estimates. The 
amortisation expense for intangible assets is recognised in the income statement in the expense category consistent 
with the function of the intangible asset. 
Gains or losses arising from derecognition of an intangible asset are measured at the difference between the net 
disposal proceeds and the carrying amount of the asset and recognised in profit and loss when the asset is 
derecognised. 
k. Property, plant and equipment:
Property, plant and equipment are stated at cost, less accumulated depreciation and impairment losses. 
Depreciation is calculated using the straight-line method, over the estimated useful life of the assets as follows:
         Years
Hotel buildings        50 – 95
Furniture and equipment        2 – 15
The costs of maintaining property, plant and equipment are recognised in the income statement as they are 
incurred. Costs incurred that significantly increase the recoverable amount of the asset concerned are added to 
the asset’s cost as an improvement and depreciated over the expected useful life of the improvement. 
l. Impairment of non-financial assets:
At each reporting date, the Group reviews the carrying amounts of its non-financial assets to determine whether 
there is any indication that those assets may be impaired. If any such indication exists, the recoverable amount of 
the asset is estimated. Where it is not possible to estimate the recoverable amount of an individual asset, the Group 
estimates the recoverable amount of the cash-generating unit to which the asset belongs.
Recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. In assessing value in 
use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects 
current market assessments of the time value of money and the risks specific to the asset.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the 
asset is considered impaired and carrying amount of the asset (cash-generating unit) is reduced to its recoverable 
amount. Impairment losses are recognised as an expense immediately. 
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is 
increased to the revised estimate of its recoverable amount, but not in excess of the carrying amount that would 
have been determined had no impairment loss been previously recognised for the asset (cash-generating unit). 
A reversal of an impairment loss is recognised as income immediately.
m. Investments and other financial assets:
Financial assets within the scope of IAS 39 are classified as financial assets at fair value through profit or loss, loans 
and receivables, held-to-maturity investments, or available-for-sale financial assets, as appropriate. When financial 
assets are recognised initially, they are measured at fair value, plus, in the case of investments not at fair value 
through profit or loss, directly attributable transaction costs. 
The Group determines the classification of its financial assets on initial recognition and, where allowed and 
appropriate, re-evaluates this designation at each financial year end. 50   Park Plaza Hotels Annual Report 2007
m. Investments and other financial assets: continued
All regular way purchases and sales of financial assets are recognised on the trade date, which is the date that the 
Group commits to purchase the asset. Regular way purchases or sales are purchases or sales of financial assets that 
require delivery of assets within the period generally established by regulation or convention in the marketplace.
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in 
an active market. Such assets are carried at amortised cost using the effective interest method. Gains and losses are 
recognised in income when the loans and receivables are derecognised or impaired, as well as through the 
amortisation process.
n. Inventories:
Inventories include food and beverages and are valued at the lower of cost and net realisable value. Cost includes 
purchase cost on a first in-first out method. 
Net realisable value is the estimated selling price in the ordinary course of business and the estimated costs 
necessary to make the sale.
o. Cash and cash equivalents:
Cash and cash equivalents comprise cash at bank and in hand and short-term deposits with an original maturity 
of three months or less.
p. Derivative financial instruments:
The Group uses derivative financial instruments such as interest rate swaps to hedge its risks associated with 
interest rate fluctuations. Such derivative financial instruments are initially recognised at fair value on the date on 
which a derivative contract is entered into and are subsequently remeasured at fair value. Derivatives are carried 
as assets when the fair value is positive and as liabilities when the fair value is negative.
Any gains or losses arising from changes in fair value on derivatives that do not qualify for hedge accounting are 
taken directly to profit or loss.
The fair value of interest rate swap contracts is determined by reference to market values for similar instruments.
For the purpose of hedge accounting, hedges are classified as cash flow hedges when hedging exposure to variability 
in cash flows that is either attributable to a particular risk associated with a recognised asset or liability or a forecast 
transaction.
At the inception of a hedge relationship, the Group formally designates and documents the hedge relationship to 
which the Group wishes to apply hedge accounting and the risk management objective and strategy for undertaking 
the hedge. The documentation includes identification of the hedging instrument, the hedged item or transaction, 
the nature of the risk being hedged and how the entity will assess the hedging instrument’s effectiveness in offsetting 
the exposure to changes in the cash flows attributable to the hedged risk. Such hedges are expected to be highly 
effective in achieving offsetting changes in cash flows and are assessed on an ongoing basis to determine that they 
actually have been highly effective throughout the financial reporting periods for which they were designated.
The effective portion of the gain or loss on the hedging instrument is recognised directly in equity, while the 
ineffective portion is recognised in profit or loss. Amounts taken to equity are transferred to the income statement 
when the hedged transaction affects profit or loss, such as when hedged financial income or financial expense 
is recognised.
q. Trade receivables:
Trade receivables recognised under current assets are stated at their nominal value as reduced by appropriate 
allowances for estimated uncollectible amounts.
r. Bank borrowings:
Interest-bearing bank loans are recorded at the proceeds received, net of direct transaction costs. After initial 
recognition these borrowings are subsequently measured at amortised cost using the effective interest method.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   51  
s. Revenue recognition:
In accordance with IAS 18, revenue corresponds to the value of goods and services sold in the ordinary course 
of business by fully and proportionally consolidated companies. It includes:
– For directly owned and leased hotels, all revenue received from customers for accommodation, catering and 
other services, and for managed and franchised hotels, all management and franchise fees.
– For the service businesses, royalties for the use of Group trademarks.
In accordance with IAS 18, revenue is measured at the fair value of the consideration received or receivable, net of 
all discounts and rebates, VAT and other sales taxes.
Rental revenue is recognised over the lease term on a straight-line basis. Other revenues, from rendering of services 
(consulting) are recognised as the services are provided.
EBITDAR
Earnings before interest, tax, depreciation, amortisation and rental expenses and share of associate and tax 
(EBITDAR) corresponds to revenue less operating expenses. EBITDAR, together with EBITDA is used as a key 
management indicator. 
EBITDA
Earnings before interest, tax, depreciation and amortisation (EBITDA) corresponds to gross profit after the 
operating costs of holding leased hotels.
EBIT 
Earnings before interest and tax (EBIT) corresponds to gross operating profit after the operating costs of holding 
both leased and owned assets. 
t. Leases:
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards 
of ownership to the lessee. All other leases are classified as operating leases.
The Group as lessor
Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease.
The Group as lessee
Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the 
term of the lease.
Prepaid leasehold payments
Prepaid leasehold payments are up-front payments to acquire long-term leasehold interest in land and building. 
These payments are stated at cost and are amortised on a straight-line basis over the respective period of the leases 
(between 95 and 125 years).
u. Employee benefits:
Share based payments
The Board has adopted a Share Option Plan, under which employees and directors of the Company, its subsidiaries 
and jointly owned companies receive remuneration in the form of share-based payment transactions, whereby 
employees render services as consideration for equity instruments (equity settled transactions). The costs of 
equity-settled transactions is recognised, together with a corresponding increase in equity, over the period in which 
the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees 
become fully entitled to the award (vesting period). The cumulative expense recognised for equity-settled 
transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired 
and the Group’s best estimate on the number of equity instruments that will ultimately vest. The income statement 
charge or credit for a period represents the movement in the cumulative expenses recognised as at the beginning 
and end of that period. 
Pension
The Group has defined contribution pension plans where the employer is liable only for the employer’s part of the 
contribution towards the individual’s pension plans. 52   Park Plaza Hotels Annual Report 2007
v. Borrowing costs:
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, are 
added to the cost of those assets, until such time as the assets are substantially ready for their intended use or 
sale. Investment income earned on the temporary investment of specific borrowings pending their expenditure 
on qualifying assets is deducted from the borrowing costs eligible for capitalisation. 
All other borrowing costs are recognised in the income statement in the period in which they are incurred.
w. Taxation:
Current income tax
Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to 
be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are 
those that are enacted or substantively enacted by the balance sheet date.
Deferred income tax
Deferred income tax is provided using the liability method on temporary differences at the balance sheet date 
between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred 
tax liabilities are recognised for all taxable temporary differences, except:
• where the deferred tax liability arises from the initial recognition of goodwill or from an asset or liability in a 
transaction that is not a business combination and, at the time of the transaction, affects neither the accounting 
profit nor taxable profit or loss; 
• in respect of taxable temporary differences associated with investments in subsidiaries, associates and jointly 
controlled entities, where the timing of the reversal of the temporary differences can be controlled and it is 
probable that the temporary differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all deductible temporary differences, carry-forward of unused tax 
credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the 
deductible temporary differences; and the carry-forward of unused tax credits and unused tax losses can be utilised 
except:
• where the deferred income tax asset relating to the deductible temporary difference arises from the initial 
recognition of an asset or liability in a transaction that is not a business combination and, at the time of the 
transaction, affects neither the accounting profit nor taxable profit or loss; and
• in respect of deductible temporary differences associated with investments in subsidiaries, associates and jointly 
controlled entities, deferred tax assets are recognised only to the extent that it is probable that the temporary 
differences will reverse in the foreseeable future and taxable profit will be available against which the temporary 
differences can be utilised.
The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent 
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income 
tax asset to be utilised. Unrecognised deferred income tax assets are reassessed at each balance sheet date and are 
recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to 
be recovered.
Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when 
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or 
substantively enacted at the balance sheet date.
Deferred income tax relating to items recognised directly in equity is recognised in equity and not in the income 
statement.
Deferred income tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current 
tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same 
taxation authority.
x. Earnings per share:
Basic earnings per share amounts are calculated by dividing net profit for the year by the weighted average number 
of Ordinary shares outstanding during the year.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   53  
x. Earnings per share: continued
Diluted earnings per share amounts are calculated by dividing the net profit for the year by the weighted average 
number of Ordinary shares outstanding during the year plus the weighted average number of Ordinary shares 
that would be issued on the conversion of all the dilutive potential Ordinary shares into Ordinary shares.
y. Future changes in accounting standards:
Standards issued but not yet effective
IAS 23 Borrowing Costs
A revised IAS 23 Borrowing Costs was issued in March 2007, and becomes effective for financial years beginning on 
or after 1 January 2009. The Standard has been revised to require capitalisation of borrowing costs when such costs 
relate to a qualifying asset. A qualifying asset is an asset that necessarily takes a substantial period of time to get 
ready for its intended use or sale. As the Company already has a policy of capitalising borrowing costs, the 
Company believes this Standard will have no material impact on the financial statements.
IAS 1 (Revised) Presentation of Financial Statements
The revised IAS 1 Presentation of Financial Statements was issued in September 2007 and becomes effective for 
financial years beginning on or after 1 January 2009. The Standard separates owner and non-owner changes in 
equity. The statement of changes in equity will include only details of transactions with owners, with all non-owner 
changes in equity presented as a single line. In addition, the Standard introduces the statement of comprehensive 
income: it presents all items of income and expense recognised in profit or loss, together will all other items of 
recognised income and expense, either in one single statement, or in two linked statements.
The effect of the adoption of IAS 1 (Revised) will require the Company to present the above disclosure in the 
financial statements.
IFRS 3 (Revised) Business Combinations and IAS 27 (Revised) Consolidated and Separate Financial Statements
The revised standards were issued in January 2008 and become effective for financial years beginning on or after 
1 July 2009. IFRS 3R introduces a number of changes in the accounting for business combinations that will impact 
the amount of goodwill recognised, the reported results in the period that an acquisition occurs, and future 
reported results. IAS 27R requires that a change in the ownership interest of a subsidiary is accounted for as an 
equity transaction. Therefore, such a change will have no impact on goodwill, nor will it give rise to a gain or loss. 
Furthermore, the amended standard changes the accounting for losses incurred by the subsidiary as well as the loss 
of control of a subsidiary. The changes introduced by IFRS 3R and IAS 27R must be applied prospectively and will 
affect future acquisitions and transactions with minority interests.
IFRS 2 (Revised) Share-based Payment
The amendment to IFRS 2 Share-based Payments was published in January 2008 and becomes effective for 
financial years beginning on or after 1 January 2009. The Standard restricts the definition of “vesting condition” 
to a condition that includes an explicit or implicit requirement to provide services. Any other conditions are 
non-vesting conditions, which have to be taken into account to determine the fair value of the equity instruments 
granted. In the case that the award does not vest as the result of a failure to meet a non-vesting condition that is 
within the control of either the entity or the counterparty, this must be accounted for as a cancellation.
The Company has not entered into share-based payment schemes with non-vesting conditions attached and, 
therefore, does not expect significant implications on its accounting for share-based payments.
IFRS 8 Operating Segments
At 30 November 2006 IFRS 8 operating segment was issued and will replace IAS 14 Segment Reporting. IFRS 8 will 
be effective as of 1 January 2009
IFRIC 11 IFRS 2 – Group and Treasury Share Transactions
This interpretation becomes effective for annual periods beginning on or after March 1, 2007. This interpretation 
requires arrangements whereby an employee is granted rights to an entity’s equity instruments to be accounted for 
as an equity-settled scheme, even if the entity buys the instruments from another party, or the shareholders provide 
the equity instruments needed. This interpretation is not expected to have an impact on the Group.
IFRIC 13 Customer Loyalty Programmes:
IFRIC Interpretation 13 was issued in June 2007 and becomes effective for annual periods beginning on or after 1 July 
2008. This Interpretation requires customer loyalty award credits to be accounted for as a separate component of the 
sales transaction in which they are granted and therefore part of the fair value of the consideration received is allocated 
to the award credits and deferred over the period that the award credits are fulfilled. The Group expects that this 
interpretation will have no impact on the Group’s financial statements. 54   Park Plaza Hotels Annual Report 2007
Note 3 Business Combination
On 14 July 2007, as part of the IPO (Note 1c), the Group acquired 100% of the voting shares of Park Plaza Hotels 
Europe Holding B.V., its subsidiaries and other investments (the Park Plaza Group). A list of subsidiaries and 
investment of the Park Plaza Group is included in Appendix B. The Park Plaza Group is principally engaged in holding 
hotels and providing management and franchise services, for hotels in Europe, the Middle East and North Africa. Park 
Plaza Group operates under two brands: Park Plaza Hotels & Resorts and art’otel.
The fair value of the identifiable assets and liabilities of the Park Plaza Group as at the date of acquisition (based on an 
independent appraisal) and the corresponding carrying amounts immediately before the acquisition were:
       Fair value Previous 
       recognised on carrying  
       acquisition amount  
       €’000 €’000
Intangible assets       54,351 6,375
Property, plant and equipment       49,310 40,353
Prepaid leasehold payments       4,049 4,049
Loans to joint ventures       2,653 –
Other financial assets       2,231 2,231
Trade receivables       8,680 8,680
Short-term deposits       1,903 1,903
Cash and cash equivalents       6,734 6,734
Other current assets and receivables       2,480 2,480
        132,391 72,805
Bank loans       (41,909) (41,909)
Other financial liabilities       (4,427) (4,427)
Deferred income taxes       (187) 1,364
Trade payables       (3,305) (3,305)
Related parties       (830) (830)
 Payables and other current liabilities       (7,762) (7,762)
        (58,420) (56,869)
        73,971 15,936
Negative goodwill on acquisition       (13,036) 
Total consideration       60,935 
The sale and purchase agreement to acquire Park Plaza Group set the consideration as a percentage of the combined 
company value at the time of the IPO. Due to market conditions, the placing price was set at the bottom of the range 
and the number of placing shares issued was reduced (compared to the published placing price range and placing 
shares issued in the pathfinder admission document). As a result, the value attributed to Park Plaza Group was lower 
than expected, resulting in negative goodwill.
The profit arising from the immediate recognition of negative goodwill in the income statement is included in the line 
item “other income”.
The total cost of the acquisition was €60,935 thousand and comprised an issue of equity instruments and costs 
directly attributable to the acquisition. The Company issued 7,500,000 Ordinary shares with a fair value of £5.50 each 
(€8.125 at the exchange rate on date of acquisition), which was the published price of the shares of the Company at 
the date of acquisition.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   55  
From the date of the acquisition, the Park Plaza Group has contributed €2.9 million to the net profit of the Group. If 
the combination had taken place at the beginning of the year, the profit and loss for the Group would have been as 
follows:
          2007 
         €’000
Revenues        97,058
Operating expenses        (57,677)
EBITDAR        39,381
Rental expenses        (11,007)
EBITDA        28,374
Depreciation and amortisation        (9,353)
EBIT        19,021
Finance expenses, net        (19,025)
Share in loss of associate        (40)
Other income        22,184
Profit before tax        22,140
Income taxes         923
Net profit for the year        23,063 56   Park Plaza Hotels Annual Report 2007
Note 4 Intangible assets
     Park Plaza 
     management 
     and franchise art’otel Intangible 
     rights  rights  lease rights Total 
     €’000 €’000 €’000 €’000
Cost 
Balance as of 1 January 2007     – – – –
Acquisitions during the year     48,404 4,000 5,947 58,351
Balance as of 31 December 2007     48,404 4,000 5,947 58,351
Accumulated depreciation
Balance as of 1 January 2007     – – – –
Provision for amortisation     1,209 100 49 1,358
Balance as of 31 December 2007     1,209 100 49 1,358
Depreciated cost as of 31 December 2007     47,195 3,900 5,898 56,993
Depreciated cost as of 31 December 2006     – – – –
Acquisition of Park Plaza management and franchise rights and lease rights (Note 3):
a. Management rights – rights held by Park Plaza Group relating to the management of Park Plaza Hotels in Europe, 
the Middle East and North Africa. The management rights are included in the consolidated financial statements at 
their fair value as of the date of acquisition of Park Plaza Group by the Company, and are being amortised over a 
period of 20 years, based on the terms of the existing contracts and management estimation of their useful life.
b. Franchise rights – relating to the brand “Park Plaza Hotels & Resorts”, are included in the consolidated financial 
statements at their fair value as of the date of acquisition of Park Plaza Group by the Company, and are being 
amortised over 20 years, based on management estimation of their useful life. 
c. Lease rights – intangible asset relating to the terms of operating leases that at the date of acquisition of Park Plaza 
Group are favourable relative to market conditions at that date. These rights are being amortised over the terms of 
the related leases (Note 6).
Acquisition of art’otel rights:
The Company acquired in July 2007, as part of the IPO (Note 1c), the worldwide rights to use the art’otel brand name 
for an unlimited period of time. The consideration amounted to €4 million and was settled by the issuance of shares of 
the Company to the seller. The consideration was based on the published price of the shares (£5.50 per share) on the 
date of acquisition. The rights are being amortised over 20 years based on management’s estimation of their useful life.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   57  
Note 5 Property, plant and equipment
      Hotel Furniture and  
     Land buildings equipment Total 
a.  Movements in the year   Notes  €’000 €’000 €’000 €’000
Cost
Balance as of 1 January 2006     11,361 90,220 39,101 140,682
Additions during the year     2,195 8,547 2,704 13,446
Disposals during the year     – – (772) (772)
Adjustment for exchange rate differences      196 1,467 733 2,396
Balance as of 31 December 2006     13,752 100,234 41,766 155,752
Accumulated depreciation
Balance as of 1 January 2006     – 6,125 10,551 16,676
Provision for depreciation     – 1,278 3,926 5,204
Disposals during the year     – – (772) (772)
Adjustment for exchange rate differences      – 38 163 201
Balance as of 31 December 2006     – 7,441 13,868 21,309
Depreciated cost as of 31 December 2006     13,752 92,793 27,898 134,443
Cost
Balance as of 1 January 2007     13,752 100,234 41,766 155,752
Additions during the year     – 5,449 3,188 8,637
Acquisition of the Park Plaza Group   3  10,113 33,056 6,141 49,310
Disposals during the year     – (5,554) – (5,554)
Adjustment for exchange rate differences      (876) (7,165) (3,604) (11,645)
Balance as of 31 December 2007     22,989 126,020 47,491 196,500
Accumulated depreciation
Balance as of 1 January 2007     – 7,441 13,868 21,309
Adjustment for exchange rate differences      – (277) (1,274) (1,551)
Provision for depreciation     – 1,408 4,486 5,894
Balance as of 31 December 2007     – 8,572 17,080 25,652
Depreciated cost as of 31 December 2007     22,989 117,448 30,411 170,848
       As at 31 December
       2007  2006 
       €’000  €’000
b. Cumulative expenditure for hotels under construction included in cost balances    1,297 50
The cumulative expenditure for hotels under construction relates to the renovation and conversion of the Victoria 
Monument building (located in Amsterdam) into a hotel.
c. For information regarding liens, see Note 14.  58   Park Plaza Hotels Annual Report 2007
Note 6 Prepaid leasehold payments
       Year ended 31 December
       2007  2006 
     Notes  €’000  €’000
Cost
Balance as of 1 January       19,440 19,025
Acquisition of the Park Plaza Group     3  4,049 –
Adjustment for exchange rate differences        (2,027) 415
Balance as of 31 December        21,462 19,440
Accumulated depreciation
Balance as of 1 January        762 586
Provision for amortisation       182 167
Adjustment for exchange rate differences        (103) 9
Balance as of 31 December       841 762
Depreciated cost as of 31 December        20,621 18,678
The prepaid leasehold payments relate to the following lease agreements:
a. In September 2000, Grandis Netherlands Holding B.V., a jointly controlled company, acquired a land leasehold 
interest expiring in 2095, of the Park Plaza Sherlock Holmes Hotel, London, for a sum of £10 million (€13.6 million) 
plus an initial annual rent of £400 thousand (€545 thousand) (subject to “open market value” rent review every  
5 years). The company has an option to extend the lease to a total of 125 years, expiring in 2121. The company also 
has an option to terminate the lease in 2059.
b. In May 2000, Riverbank Hotel Holding B.V., a jointly controlled company, acquired a land leasehold interest 
expiring in 2125, of the Park Plaza Riverbank Hotel, situated on the Albert Embankment, London, for a sum of  
£18 million (€24.5 million) plus an initial annual rent of £500 thousand (€681 thousand), subject to rent review 
every five years. 
c. Utrecht Victoria Hotel B.V., a jointly controlled company, has entered into a land lease agreement for a period 
of 50 years ending in 2038, for a lump sum payment of €448 thousand at commencement of the lease.
d. The acquisition of the Park Plaza Group relates to the purchase of an additional 10% interest in Grandis 
Netherlands Holding B.V. and Riverbank Hotel Holding B.V. (jointly controlled companies).
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   59  
Note 7 Investment in an associate
a. The Group owns 33.3% of the share capital of Marlbray Ltd. Marlbray owns land located near the Waterloo railway 
station in London, which forms part of the Park Plaza Westminster Bridge London project. Marlbray is developing 
a 1,037 room apart-hotel. The rooms or apartments are being pre-sold on an individual basis to private investors. 
The carrying value of the investment includes the excess of cost over the fair value of the net assets acquired in the 
amount of €9.1 million which was allocated to land (see also Note 14 and Note 30).
Marlbray commenced construction of the apart-hotel in May 2007, with expected completion in May 2010.
b. Composition of investment and movement:
       As at 31 December
       2007  2006 
       €’000  €’000
Balance at the beginning of the year       10,028 9,723
Share of profit/(loss)       (40) 85
Translation differences       (879) 220
Balance at the end of the year       9,109 10,028
Share of the associate’s balance sheet:
       As at 31 December
       2007  2006 
       €’000  €’000
Current assets       1,141 20,656
Non-current assets       41,423 9,932
Current liabilities       (1,147) (20,560)
Non-current liabilities       (32,308) –
Net assets       9,109 10,028
Share of the associate’s revenue and profit
Revenue       – –
Profit/(loss)       (40) 85
Note 8 Other financial assets
       As at 31 December
       2007  2006 
     Notes  €’000  €’000
Derivative financial instruments     29  3,707 4,346 60   Park Plaza Hotels Annual Report 2007
Note 9 Trade receivables
a. Composition
       As at 31 December
       2007  2006 
       €’000  €’000
Trade receivables       10,930 3,432
Less – allowance for doubtful debts        (296) (159)
        10,634 3,273
Trade receivables are non-interest-bearing and are generally on 30 days’ terms. 
b. Movements in the allowance for doubtful accounts were as follows:
At January 1, 2006        138
Charge for the year        21
At December 31, 2006        159
Charge for the year        60
Acquisition of the Park Plaza Group        77
At December 31, 2007        296
c. As at December 31, the ageing analysis of trade receivables is as follows:
       Past due but not impaired
    Neither past  
    due nor 
   Total impaired < 30 days 30 – 60 days 60 – 90 days > 90 day
2007   10,634 1,716 2,584 1,699 836 3,799
2006   3,273 589 1,458 831 338 57
Note 10 Other receivables and prepayments
       As at 31 December
       2007  2006 
       €’000  €’000
Prepaid expenses       1,126 670
VAT and taxes       191 239
Related parties        1,291 530
Rent security deposit       842 –
Others       711 135
        4,161 1,574
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   61  
Note 11 Cash and cash equivalents 
Cash at banks earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for 
varying periods of between one day and three months, depending on the immediate cash requirements of the Group, 
and earn interest at the respective short-term deposit rates. The weighted average interest rate at 31 December 2007 
was 6.17%.
Note 12 Issued capital and reserves
a. Share capital
The authorised share capital of the Company is represented by an unlimited number of Ordinary Shares with no 
par value.
At 31 December 2007, the number of Ordinary shares outstanding was 40,942,292.
b. Nature and purpose of reserves:
Hedging reserve
This reserve is comprised of the gain or loss on a hedging instrument in a cash flow hedge that is determined to be 
an effective hedge. 
The net loss on cash flow hedges during the year, recognised in equity was €2,590 thousand (2006: profit of €4,955 
thousand).
Currency translation reserve
The currency translation reserve is used to record exchange differences arising from the translation of the financial 
statements of foreign operations. 
c. Dividends paid:
        2007  2006 
       €’000  €’000
Declared and paid during the year (€0.86 per share)      15,000 – 62   Park Plaza Hotels Annual Report 2007
Note 13 Share-based payments
During 2007 the Company established a Share Option Plan with the following principal terms: 
a. The Plan has two types of options: Option A and Option B. Both options have an exercise price per share of  
£5.50 (€7.50). Option A vests over a period of three years from date of grant and Option B vests at the end of three 
years from grant date. Unexercised options expire 10 years after the date of grant.
b. At any time, the total number of shares issued and/or available for grant (in a ten-year period) under the Share 
Option Plan or under any other employee share scheme which the Company may establish in the future may not 
exceed 5% of the Company’s issued share capital at that time. For the purpose of this calculation, any option 
granted under the Share Option Plan immediately following Admission to the AIM in July 2007 are disregarded. 
The expense arising from equity-settled share based payment transactions during 2007 is €68 thousand (2006: nil).
Movements in the year
The following table illustrates the number (No.) and exercise prices (EP) of, and movements in, share options during 
2007 (in 2006, no option plan was in place).
       No. of  EP 
       options  £
Outstanding at 1 January 2007      –  –
Options A granted during the year      296,634 5.50 (€7.50)
Options B granted during the year      90,660 5.50 (€7.50)
Outstanding at 31 December 2007      387,294 5.50 (€7.50)
Exercisable at 31 December 2007      –  –
The weighted average remaining contractual life for the share options outstanding as at 31 December 2007 is 9.5 years.
The weighted average fair value of the options granted in 2007 was £0.51 (€0.70).
The following table lists the inputs to the model used for the Option plan:
         2007
Dividend yield (%)        0
Expected volatility (%)        30.00
Risk-free interest rate        5.04
Expected life of options (years)        6.00
Weighted average share price       £3.50 (€4.77)
Model used       Black Scholes
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   63  
Note 14 Commitments and pledges
a. Pledges, collateral and securities:
Substantially all of the Group’s assets and all of the rights connected or related to the ownership of the assets 
(including shares of subsidiaries) are pledged in favour of banks and financial institutions as a security for loans 
received. For most of the loans, specific assets are pledged as the sole security provided. For certain loans, the 
Group companies are required to comply with certain financial and operating covenants. As of 31 December 2007, 
these companies are in compliance with the covenants, apart from the NIBC facility (see below).
1. On 3 March 2006, three jointly controlled companies, Riverbank Hotel Holding B.V., Victoria London Hotel 
Holding B.V and Grandis Netherlands Holding B.V. (“Holding Companies”) entered into a loan agreement 
together with Park Plaza Hotels Europe Holding B.V (“Park Plaza”) as joint and several borrowers 
(“Borrowers”) and Goldman Sachs International Bank as lender (“Lender”) for the grant of a non recourse 
refinancing loan in the amount of £195 million (€266 million) (“the Loan”). The loan term ends on 3 March 
2011 or, if the Borrowers have exercised a Term-out Option, 3 March 2013.
 The Borrowers have taken upon themselves to comply with financial and operating covenants. As of 31 
December 2007, the Borrowers are in compliance with the covenants.
 In the event of cash distributions deriving from the sale, disposal or refinancing of the Holding Companies’ 
hotels or upon repayment of the loan (“Transactions”), the Borrowers shall pay to the Lender an amount (“exit 
fee”) equivalent to 15% of the difference between the market value of the hotels at the Transaction date and the 
base value of the Hotels for the purposes of the Loan. The payment amortisation schedule of the loan includes 
an amount of €3.7 million in respect of the exit fee.
2. On 1 October 2004, two jointly controlled companies, Utrecht Victoria Hotel B.V. and Victoria Hotel C.V., and 
a wholly-owned company, The Mandarin Hotel B.V., as borrowers and guarantors entered into an €80 million 
term loan facility with Merrill Lynch International. The loan term ends on 30 September 2009.
 The Borrowers have taken upon themselves to comply with a number of financial and operating covenants. 
As of  31 December 2007, the Borrowers are in compliance with the covenants.
3.  On 25 January 2006, three wholly-owned companies, Park Vondel Hotel Real Estate B.V. (“PHRE”) as 
Borrower, Park Vondel Hotel Holding B.V. (“PHH”) and Park Vondel Hotel Management B.V. (“PHM”) 
as Guarantors entered into a €18.5 million secured term facility agreement with NIBC Bank N.V. (“NIBC”) 
as Lender.
 The loan consists of two parts: Facility A, to an aggregate of €17.5 million is to be applied by the Borrower for 
the purchase of the Park Plaza Vondelpark Amsterdam and Facility B, to an aggregate of €1 million, shall be 
applied towards payment of renovation costs. The loan term ends on 25 January 2013.
 The Borrowers have taken upon themselves to comply with a number of financial covenants. As of 31 December 
2007, the Borrowers did not meet some of the financial covenants and, as a result, the loan has been reclassified 
to current liabilities. 
4. On 14 December 2006, a jointly controlled company, Victoria Monument B.V. (the “Borrower”) and Bank 
Hapoalim B.M. (the “Lender”) entered into €14 million facility agreement (the “Bank Hapoalim Facility”). 
The facility was made available to finance the purchase of a building located adjacent to the Park Plaza Victoria 
Amsterdam hotel (the “Property”). The facility is repayable in full on 30 November 2008.
 The Borrowers have taken upon themselves to comply with a number of financial and operating covenants. 
As of 31 December 2007, the Borrowers are in compliance with the covenants.
5. As part of the undertakings under the Bank of Scotland loan agreement with Hotel Leeds Holding B.V. (“HLH”) 
and Hotel Nottingham Holding B.V. (“HNH”), the Company entered into a subordination agreement, under 
which the Group’s loans to HLH and HNH are subordinated to those of the Bank. 64   Park Plaza Hotels Annual Report 2007
b. Commitments:
1. Management and franchise agreements:
(i) The Group entered into several management agreements with hotels located in the Netherlands, Belgium 
and the U.K., (“the hotels”) in consideration for an annual fee of 2% of the hotels’ gross room revenues, as 
well as 7% to 10% of the gross operating profit. The Group is also partially reimbursed for certain portions 
of the expenses incurred, up to 3% of the gross operating profit. The management agreements are for 
periods of 15 to 20 years. The Group is vested with ownership rights at a rate of 50% or 55%, as the case 
may be, in several of these hotels.
(ii) Within the terms of the management agreements, the hotels were granted by the Group a sub-franchise 
licence allowing them the utilisation, throughout the term of the management agreements, of the “Park 
Plaza Hotels & Resorts” name, in consideration for royalties of a certain percentage of the gross room 
revenues. 
(iii) The Group entered into a Territorial Licence Agreement dated 30 September 2002 (the “Master 
Agreement”) with Carlson Hotels Worldwide, Inc. (“Carlson”). Under the Master Agreement, the Group, 
amongst other rights, is granted an exclusive licence to use the brand, “Park Plaza Hotels & Resorts” in 56 
territories throughout Europe, the Middle East and North Africa in perpetuity (the “Territory”). The Master 
Agreement also allows the company to use, and licence others to use, the Carlson Systems within the 
Territory which right includes the right to utilise the System’s international marketing and reservations 
facilities and to receive other promotional assistance. The Group pays Carlson a fee based on a percentage 
of the hotels’ gross room revenue
2. Lease agreements:
(i) The Group has entered into several operating lease agreements for the rental of land. Certain of the leases 
are subject to periodic rent reviews. The future minimum rental payments under non-cancellable leases are 
as follows:
       2007  2006 
       €’000  €’000
Within one year       942 845
After one year but not more than 5 years      3,767 3,379
More than 5 years       88,055 78,829
        92,764 83,053
(ii) The Group operates hotels under various lease agreements in which the building, fixtures, furniture and 
equipment are leased. These leases have an average life of between 10 to 20 years, with renewal options. 
The lease payments are the higher between a minimum agreed amount and a percentage of the hotel 
turnover. 
 Future minimum rentals payable under non-cancellable operating leases are as follows:
       2007  2006 
       €’000  €’000
Within one year       9,149 –
After one year but not more than 5 years      36,623 –
More than 5 years       147,309 –
       193,081 –
c. Guarantees:
1. In June 2005, Euro Sea Hotels N.V. (a wholly-owned subsidiary of the Company) acquired a 33.33% interest in 
Marlbray Ltd. from the founder shareholders (see also Note 7).
 One of the founder shareholders (Galliard Homes Limited), entered into a Minimum Annual Yield Agreement 
with each of the apart-hotel units’ purchasers, which guarantees to the purchasers a 6% annual yield on their 
investment including deposits for a five-year period from completion of the sale. Completion is expected in 
2010. Galliard Homes Limited may face under these guarantees a shortfall equal to the difference between 
the minimum guarantee and the apart-hotel net operating profit.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   65  
 Although the Group is not a party to these agreements, as part of the Supplemental Shareholders’ Agreement, 
Euro Sea Hotels N.V. (“Euro Sea”) agreed to indemnify (subject to certain limitations) this shareholder for 
one-third of any liability arising under this guarantee. 
 As at 31 December 2007, more than 75% of the apart-hotel units had been pre-sold or contracted to pre-sell. 
Total sales proceeds amount to approximately £231 million (€315 million) resulting in approximately £13.9 
million (€18.9 million) of future committed annual yield guarantee. 
 As at 31 December 2007, the total amount of deposits received for the pre-sold contracts is £35 million, and 
accordingly, the maximum amount of the Group’s yield guarantee is £0.7 million (€1 million). The shortfall 
between the amount guaranteed and the actual yield on the deposits is immaterial as at 31 December 2007.
2. On 19 April 2007, Marlbray (the “Borrower”) entered into a £221 million (€301 million) facility agreement 
(the “Marlbray Facility Agreement”) with Bank Hapoalim B.M. (the “Lender”).
 The Loan drawn under the Marlbray Facility Agreement is repayable in full on the earlier of: (a) 30 business days 
of the date of Practical Completion of building (Practical Completion takes place when the last certificate 
required in connection with practical completion of the project (see 1. above) and the costs of such certificate 
have been paid); and (b) the Final Maturity Date, being four years from the date of the Marlbray Facility 
Agreement. The interest rate on the Loan is LIBOR plus 2.15%.
 As part of the loan agreement, the Lender was provided with Cost Overrun and Completion Guarantees given 
by the subsidiary, Euro Sea Hotels N.V., with a maximum amount payable of £6 million (€8.2 million), and a 
Sponsor Guarantee for the entire amount of the Loan – given jointly and severally by Euro Sea Hotels N.V. and 
its partners.
 In addition the borrowers have taken upon themselves to comply with a number of financial covenants as 
specified in the loan agreement. As at 31 December 2007, the Borrowers are in compliance with the covenants.
Note 15 Bank borrowings
a. Composed as follows:
Current:
     Average interest rate  As at 31 December
       2007  2006 
      % €’000  €’000
Bank loans      3 month EURIBOR +1.5% 6,999 6,953
Current maturities of long-term bank loans       21,657 2,161
        28,656 9,114
Non-current:
     Average interest rate  As at 31 December
       2007  2006 
      % €’000  €’000
Loans in € 
1
       
1
 61,494 43,472
Loans in GBP       7.72 138,075 127,709
        199,569 171,181
Less – current maturities       (21,657) (2,161)
        177,912 169,020
For details of interest rate swap, see Note 29b.
1 Loan of €42,783 thousand bears interest at the rate of Euribor plus margin of 1.5%, which has been converted by swap agreements to a fixed annual rate of 5.11%. Loan of 
€18,711 thousand bears interest at a rate of Euribor plus margin of 1.65%, of which 90% has been converted by swap agreements to fixed interest payments per quarter for 
seven years at a rate varying from 2.84% to 3.91% for periods up until 2012. 
  66   Park Plaza Hotels Annual Report 2007
b. The loans are repayable in future years, as follows:
       As at 31 December
       2007  2006 
       €’000  €’000
1. Loan in €
 First year – current maturities       19,537 689
 Second year       41,957 826
 Third year       – 41,957
        61,494 43,472
 
         
2. Loan in GBP
 First year – current maturities       2,120 1,962
 Second year       2,120 1,962
 Third year       2,120 1,962
 Forth year       2,120 1,962
 Fifth year       2,120 1,962
 Thereafter       127,475 117,899
        138,075 127,709
For collateral, securities and pledges, see Note 14.
Note 16 Other financial liabilities
       As at 31 December
       2007  2006 
       €’000  €’000
Loans from other shareholders in joint ventures 
1
       2,170 –
Other        437 618
        2,607 618
1 The loans bear interest at the annual rate of 6.125%. The loans’ term is 7 years, commencing 1 January 2003.
Note 17 Other payables and accruals
       As at 31 December
       2007  2006 
       €’000  €’000
Employees       968 603
VAT and taxes       2,037 1,770
Accrued interest       1,879 1,332
Accrued expenses       6,363 4,845
Accrued rent       1,984 –
Provision for impairment        – 1,261
Related parties 
1
       2,437 14
        15,668 9,825
1 The amount owed to related parties bears no interest and has no repayment date.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   67  
Note 18 Revenues
       Year ended 31 December
       2007  2006 
       €’000  €’000
Hotel operations in the Netherlands       20,434 16,564
Hotel operations in the U.K.       34,855 28,891
Hotel operations in Germany       15,523 –
Management fee       2,296 –
Franchise fee       1,393 –
Construction consulting services 
1
       – 3,280
Other       538 117
        75,039 48,852
1 See Note 26d.
 
Note 19 Operating expenses
       Year ended 31 December
       2007  2006 
       €’000  €’000
Salaries and related expenses       20,424 12,625
Department expenses       13,717 12,299
Food and beverage       4,054 2,743
Franchise fees        1,801 –
Management fees       1,105 2,241
Provision for impairment        – 1,404
Insurance        1,910 1,979
Other expenses        1,492 2,479
        44,503 35,770
Note 20 Financial expenses
       Year ended 31 December
       2007  2006 
       €’000  €’000
Interest on bank loans       15,869 13,024
Loan facility amendment fee       2,914 –
Interest and other finance expenses to related parties      1,957 1,467
Other       468 –
        21,208 14,491
Less – borrowing costs capitalised       377 –
        20,831 14,491 68   Park Plaza Hotels Annual Report 2007
Note 21 Financial income
       Year ended 31 December
       2007  2006 
       €’000  €’000
Interest on bank deposits       3,335 –
Interest from related parties       370 625
Other       77 696
        3,782 1,321
Note 22 Other income
       Year ended 31 December
       2007  2006 
     Notes  €’000  €’000
Negative goodwill upon acquisition of Park Plaza Group     3  13,036  – 
Gain on sale of Andrássy 25 Kft     27  9,148 –
        22,184 –
Note 23 Income taxes, net
a. Taxes on income (tax benefit) included in the income statements:
       Year ended 31 December
       2007  2006 
       €’000  €’000
Current taxes       263 894
Taxes in respect of previous years        (966) 506
Deferred taxes       682 155
        (21) 1,555
b. The following are the major deferred tax liabilities and assets recognised by the Group and changes therein during 
the period:
     Tax loss Property, 
     carry- plant and 
      forward  equipment Other  Total 
     €’000 €’000 €’000  €’000
Balance as at 1 January 2006     89 (1,310) – (1,221)
Prior year adjustment     – 184 – 184
Amounts included in income statement      (89) (66) – (155)
Balance as at 31 December 2006     – (1,192) – (1,192)
Acquisition of Park Plaza Group     1,909 (1,551) (545) (187)
Amounts included in income statement      (800) 93 25 (682)
Balance as at 31 December 2007     1,109 (2,650) (520) (2,061)
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   69  
c. Reconciliation between tax expense and the product of accounting profit multiplied by the Group’s tax rate is as 
follows:
       Year ended 31 December
       2007  2006 
       €’000  €’000
Profit/(loss) before income taxes       22,277 (6,348)
 
Expected tax at the Netherlands tax rate of 25.5% (2006: in the Netherlands 29.6%)   5,681 (1,872)
Adjustments in respect of:
Income at 0% tax rate       (1,619) –
Taxes of previous years       (966) 506
Non-deductible expenses       364 243
Non-taxable income       (6,481) (26)
Tax losses for which no deferred tax was recorded      3,164 2,730
Other       (164) (26)
Income tax (benefit)/expense reported in the statement of operations     (21) 1,555
d. Tax laws applicable to the Group companies: 
1. The Company is subject to taxation under the law of Guernsey. The Company is expected to qualify for exempt 
status which will result in no Guernsey taxation upon income it receives, including interest and dividends 
received, and capital gains from the disposal of investments. Exempt status is achieved by application. 
Application is made to the Administrator of Income Tax in Guernsey for confirmation that the Company and 
its subsidiaries are eligible for exempt status under the Income Tax (Exempt Bodies) (Guernsey) Ordinance, 
1989. With effect from 01 January 2008, Guernsey has abolished the exempt company regime and the standard 
rate of income tax for companies has moved from 20% to 0%. The Company is therefore now taxed at the 
standard rate of 0%.
2. Foreign subsidiaries are subject to income taxes in their country of domicile in respect of their income. 
e. Taxation in the Netherlands: corporate income tax rate for the year 2007 is 25.5% (2006: 29.6%).
f. Taxation in the U.K.: corporate income tax rate for the year 2007 for domicile companies is 30% (2006: 30.0%) 
and for non-domicile 22.0% (2006: 22.0%).
g. Taxation in Germany: corporate income tax rate and business rates for the year 2007 is 44.38% (2006: 44.38%).
h. Taxation in Hungary: corporate income tax rate for the year 2007 is 18.0% (2006: 18.0%).
i. Final tax assessments: 
In 2006, Euro Sea Hotels N.V. reached an agreement with the Dutch tax authorities regarding the tax years 
1999-2002. Based on the agreement, income included in the tax returns for those years will be increased. 
This resulted in additional tax expense of approximately €345 thousand. 
j. Losses carried forward for tax purposes:
The Company and its subsidiaries have carry forward losses for tax purposes estimated at approximately 
€93.4 million (2006 €15.7 million). The Group did not provide for deferred taxes in respect of losses amounting 
to €90.8 million. 70   Park Plaza Hotels Annual Report 2007
Note 24 Earnings per share 
The following reflects the income and share data used in the basic earnings per share computations
       Year ended 31 December
       2007  2006 
       €’000  €’000
Profit/(loss)        22,298 (7,903)
Weighted average number of Ordinary shares outstanding      28,611 17,500
Potentially dilutive instruments (share options – see Note 13) have not been included in the calculation of diluted 
earnings per share because they are anti-dilutive for all periods presented.
Note 25 Segments
The segment reporting format is determined to be geographical segments as the Group’s risks and rates of return are 
affected predominantly by the location of the Group’s hotels.
       Year ended 31 December 2007
       Adjustments 
   The    and 
   Netherlands Germany U.K. Hungary eliminations Consolidated 
   €’000 €’000 €’000 €’000 €’000 €’000
Revenue
Third party   20,903 12,857 34,867 2,723 3,689 75,039
Inter-segment   – – – – – –
Total revenue   20,903 12,857 34,867 2,723 3,689 75,039
Results
Depreciation and amortisation   1,640 67 6,337 7 1,309 9,360
Share of profit of an associate   – – (40) – – (40)
Segment profit   7,608 250 (4,463) 146 18,736 22,277
Assets
Investment in associate   – – 9,109 – – 9,109
Capital expenditure   3,237 4,500 900 – 4,000 12,637
Operating assets   75,861 11,772 153,045 1,014 154,981 396,673
Operating liabilities   77,960 1,537 146,613 864 4,432 231,406
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   71  
       Year ended 31 December 2006
       Adjustments 
    The   and 
    Netherlands U.K. Hungary eliminations Consolidated 
    €’000 €’000 €’000 €’000 €’000
Revenue
Third party    16,564 28,919 – 3,369 48,852
Inter-segment    – – – – –
Total revenue    16,564 28,919 – 3,369 48,852
Results
Depreciation and amortisation    980 4,200 – 640 5,820
Share of profit of an associate    – 85 – – 85
Segment profit/(loss)    1,378 (6,806) (26) (894) (6,348)
Assets
Investment in associate    – 10,028 – – 10,028
Capital expenditure     8,948 4,417 – 81 13,446
Operating assets    33,535 141,885 5,439 556 181,415
Operating liabilities    55,785 136,293 830 1,764 194,672
Business segments
Revenues from external customers:
       2007  2006 
       €’000  €’000
Hotel operations       71,350 48,852
Management and franchise fees       3,689 –
Total       75,039 48,852
Operating assets:
       2007  2006 
       €’000  €’000
Hotel operations       229,391 181,415
Management and franchise fees       63,361 –
Adjustments and eliminations       103,921 –
Total       396,673 181,415
Capital expenditures:
       2007  2006 
       €’000  €’000
Hotel operations       8,427 13,446
Management and franchise fees       4,210 –
Total       12,637 13,446 72   Park Plaza Hotels Annual Report 2007
Note 26 Related parties 
a. Balances with related parties
1
:
       As at 31 December
       2007  2006 
       €’000  €’000
Short-term receivables        1,291 530
Other payables       2,437 14
b. Transactions with related parties
1
:
       Year ended 31 December
       2007  2006 
       €’000  €’000
Interest and other financial expense       1,957 1,631
Interest income       370 625
1 The following balances and transactions are with shareholders and companies controlled by shareholders.
c. Compensation of key management personnel (Executive and non-Executive Board):
       Year ended 31 December
       2007  2006 
       €’000  €’000
Short-term employee benefits       828 –
Share-based payments       23 –
Total compensation        851 –
Director’s interests in employee share incentive plan
Share options held by executive members of the Board of Directors to purchase Ordinary shares have the following 
expiry dates and exercises prices:
    Expiry  Exercise 2007  2006 
Issue date    date  price number  number
2007    2008 £5.50 (€7.50) 30,909 –
2007    2009 £5.50 (€7.50) 30,909 –
2007    2010 £5.50 (€7.50) 61,818 –
Non-shares options have been granted to non-executive members of the Board under this scheme.
d. Effective 1 October 2006, Euro Sea Hotels N.V. sold its holdings in a subsidiary WW Gear Construction Limited  
(“WW Gear”) to one of the shareholders of the Company for a consideration equal to the carrying value of WW 
Gear. As a result, the consolidation of WW Gear ceased as of 30 September 2006.
 
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   73  
Note 27 Jointly controlled entities
The Group has an interest in jointly controlled entities (Appendix D) which are engaged in the development, 
construction, management and operation of hotels. The share of the assets, liabilities, income and expenses 
of the jointly controlled entities, which are included in the consolidated financial statements are as follows:
       As at 31 December
       2007  2006 
       €’000  €’000
Non-current assets       180,846 182,738
Current assets       11,993 11,729
        192,839 194,467
Non-current liabilities       (192,791) (176,708)
Current liabilities       (23,871) (20,282)
        (23,823) (2,523)
       Year ended 31 December
       2007  2006 
       €’000  €’000
Revenues       51,930 39,237
Operating expenses       (33,740) (28,339)
EBITDAR       18,190 10,898
Rental expenses       (1,157) 847
EBITDA       17,033 10,051
Depreciation and amortisation       (4,731) (4,950)
EBIT       12,302 5,101
Financial expenses, net       (16,259) (13,033)
Loss before income taxes       (3,957) (7,932)
Income taxes        265 291
Loss for the year       (4,222) (8,223)
Disposal in 2007
In 2007 the Group sold its 50% joint venture interest in Andrássy 25 Kft. (Hungary) (50%) for a consideration of 
€14.9 million (including repayment of loan of €5.3 million). Andrássy 25 Kft. intended to convert the existing building, 
situated on the property known as 25 Andrássy St., into a hotel. Andrássy 25 Kft. had no further activities and 
generated no revenue. 
The gain on the sale amounted to €9.1 million.
The assets and liabilities of Andrássy 25 Kft. at date of sale were as follows:
        €’000
Property        5,579
Other current assets        307
         5,886
Loan from shareholder (Euro Sea Hotels N.V.)        (5,313)
Other current liabilities        (104)
Net assets at the date of sale        469 74   Park Plaza Hotels Annual Report 2007
Note 28 Financial risk management objectives and policies
The Group’s principal financial instruments, other than derivatives, comprise bank loans and overdrafts and cash and 
short-term deposits. The main purpose of these financial instruments is to raise finance for the Group’s operations. 
The Group has various other financial assets and liabilities such as trade receivables and trade payables, which arise 
directly from its operations. 
The Group also enters into derivative transactions, including principally interest rate swap contracts. The purpose is 
to manage the interest rate risk arising from the Group’s operations and its sources of finance (see Note 29).
It is, and has been throughout the years under review, the Group’s policy that no trading in financial instruments shall 
be undertaken.
The main risks arising from the Group’s financial instruments are cash flow interest rate risk, liquidity risk and foreign 
currency risk. The board of directors reviews and agrees on policies for managing each of these risks which are 
summarised below. The Group’s accounting policies in relation to derivatives are set out in Note 2.
Interest rate risk
The Group’s exposure to the risk for changes in market interest rates relates primarily to the Group’s long-term debt 
obligations with a floating interest rate.
The Group’s policy is to manage its interest cost using fixed rate debt. To manage its interest costs the Group enters 
into interest rate swaps, in which the Group agrees to exchange, at specified intervals, the difference between fixed 
and variable rate interest amounts calculated by reference to an agreed upon notional principal amount. These swaps 
are designated to hedge underlying debt obligations. After taking into account the effect of interest rate swaps, 
approximately 97% (2006 – 96%) of the Group’s borrowings are at a fixed rate of interest. The only variable interest 
rate debt relates to a short term loan for the renovation of a hotel building. The interest expense on this loan is 
capitalised during the construction period. For this reason the Group’s profit is not sensitive to possible change in 
interest rates. Possible changes in interest rates do affect the Group equity as the fair value of the swap agreements 
changes with interest rate changes. 
The fair value of the swaps of the Group (see Note 29b) as of 31 December, 2007 amounts to €3.7 million. The 
movements in the value have been accounted for in equity. The Group performed a sensitivity analysis for the effect 
of market interest rate changes on the fair value of the swaps. Based on this sensitivity analysis calculation the 
management expects that with an increase/decrease of the three months market interest rate with 50 bps the fair value 
of the swaps, and the hedge reserve in equity, would increase/decrease with €3.7 million.
The Group uses short-term deposits (weekly and monthly) to maximise its returns on the cash proceeds from the IPO. 
The management expects that the average outstanding deposit balance for 2008 will amount to €50 million. The 
interest income is subject to changes in the interest rates. In 2007 the average received interest rate was 6.2%. Should 
the interest rate increase/decrease by an average of 10% in 2008, the profit of the Group would increase/decrease by 
€309 thousand. 
Foreign currency risk
As a result of significant investment operations in the United Kingdom, the Group’s balance sheet is susceptible to 
movements in the GBP/euro exchange rates. The effect of these movements are reflected in the foreign translation 
reserve in equity. The Group did not seek to mitigate the effect of its structural currency exposure by borrowing in GBP. 
As at 31 December 2007, 69% (2006 – 75%) of the Group’s borrowing are in GBP.
Credit risk
The Group trades only with recognised, credit worthy third parties. In addition, the receivable balances are monitored 
on an ongoing basis with the result that the Group’s exposure to bad debts is not significant. With respect to credit risk 
arising from the other financial assets of the Group, which comprise cash and cash equivalents and certain derivative 
instruments, the Group’s exposure to credit risk arises from default of the counterparty, with a maximum exposure 
equal to the carrying amount of these instruments.
Since the Group trades only with recognised third parties, there is no requirement for collateral.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   75  
Liquidity risk
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank 
overdrafts and bank loans. The Group’s policy is to arrange medium-term bank facilities to finance its construction 
operation and then to convert them into long-term borrowings.
The table below summarises the maturity profile of the Group’s financial liabilities at 31 December 2007 and 2006 
based on contractual undiscounted payments.
       Year ended 31 December 2007
    Less than 3 3 to 12 1 to 5   
    months months years > 5 years Total 
    €’000 €’000 €’000 €’000 €’000
Interest bearing loans and borrowings    4,477 38,126 95,541 131,554 269,698
Other financial liabilities    – – 2,601 272 2,873
Trade and other payables    12,226 7,944 – – 20,170
Other liabilities    – – – 2,061 2,061
     16,703 46,070 98,142 133,887 294,802
       Year ended 31 December 2006
    Less than 3 3 to 12 1 to 5   
    months months years > 5 years Total 
    €’000 €’000 €’000 €’000 €’000
Interest bearing loans and borrowings    3,723 18,066 95,328 131,516 248,633
Other financial liabilities    – – 403 215 618
Trade and other payables    10,319 4,409 – – 14,728
Other liabilities    – – – 1,192 1,192
     14,042 22,475 95,731 132,923 265,171
Capital management
The primary objective of the Group’s capital management is to ensure that it maintains a strong credit rating and 
healthy capital ratios in order to support its business and maximise shareholder value.
The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. 
To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital 
to shareholders or issue new shares. 
The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Group’s 
policy is to keep the gearing ratio between 60% and 70%. The Group includes within net debt, interest bearing loans 
and borrowings, trade and other payables, less cash and cash equivalents. Capital includes equity less the hedging 
reserve.
       2007  2006 
       €’000  €’000
Interest bearing loans and borrowings       206,568 178,314
Less – cash and cash equivalents       (120,022) (7,233)
Net debt       86,546 171,081
Equity       165,267 (13,257)
Hedging reserve       (1,759) (4,349)
Total capital       163,508 (17,606)
Capital and net debt       250,054 153,475
Gearing ratio       34.6% 111.5% 76   Park Plaza Hotels Annual Report 2007
Note 29 Financial instruments
a. Fair value of financial instruments:
The carrying amounts of cash and cash equivalents, short-term deposits, trade receivables, other receivables and 
prepayments, short-term bank borrowings, other payables and accruals, trade payables and variable rate loans 
approximate their fair value.
b. Derivative financial instruments:
1. The majority of the Group’s borrowings are at variable interest rates. To limit its exposure to changes in the rates 
of the LIBOR on its cash flows and interest expense the Group has entered into various interest rate swaps, as 
described below.
2. In 2004, three subsidiaries of the Company entered into an interest swap agreement with Merrill Lynch 
International. According to the agreement, the subsidiary swapped the floating interest rate of three months 
LIBOR on a loan in the amount of €43.5 million, received from Merrill Lynch International, with a fixed interest 
rate of 3.41% for a period of 5 years effective from October 2003 and maturing in October 2008.
 The swap is presented at its fair value, as prescribed for such transactions in IAS 39, and changes in the fair value 
are reflected in the shareholders’ equity, net of tax. As of 31 December 2007, the fair value amounted to an asset 
of €0.7 million (31 December 2006 – asset of €0.6 million).
 3. In 2006, three jointly controlled companies of the Company entered into an interest rate swap hedge 
transaction, according to which the companies swapped the variable interest rate of three months LIBOR +3% 
on a loan in the amount of €138.1 million received from Goldman Sachs International Bank with fixed interest 
rate of 7.72% for a period until 2011.
 The fair value of the swap as of 31 December 2007 is estimated at €2.5 million (2006: 3.7 million).
4. In 2007 a subsidiary entered into an interest rate swap according to which the subsidiary swapped the variable 
interest rate of 3 month Euribor on a loan in the amount of €15.75 million received from NIBC with fixed interest 
payments at rates varying from 2.84% to 3.91% for periods up to 2012.
 As at 31 December 2007, the fair value of the swap is estimated at €0.5 million.
5. As at 31 December 2007, Group companies have no bank facilities.
Notes to the consolidated financial statements
continued Park Plaza Hotels Annual Report 2007   77  
Note 30 Events after the balance sheet date
a. Acquisition of Park Plaza Westminster Bridge London hotel:
In February 2008, Euro Sea Hotels N.V., a wholly owned subsidiary of the company, acquired 67% of the shares 
of Marlbray Ltd., increasing the Group’s ownership interest in Marlbray to 100%. Marlbray is the owner of the 
Park Plaza Westminster Bridge London project (see Note 7). 
The total consideration for the 67% interest acquired, in the amount of €16.71 million, consists of £10.27 million 
(€14.0 million) in cash and the issue of 735,000 Ordinary shares of the Company (490,000 of which will be issued 
to the sellers of Marlbray). The market price of the shares on the date of acquisition was £3.16 (€4.31). As part 
of the consideration, the Company is funding the repayment of approximately £472 thousand (€643 thousand) 
of loans made to Marlbray by the selling shareholders and a fee payable by Marlbray to Irish Nationwide Building 
Society, (which provided finance for the early stages of the project), which will be satisfied by approximately 
£3.2 million (€4.4 million) in cash and the issue of 245,000 Ordinary shares. The Company is presented in the 
process of evaluating the assets and liabilities acquired and the determination of the goodwill, if any.
 b. Joint venture with Aldersgate Investments Limited:
In March 2008, Apex Holdings (U.K.) Limited (“Apex”), a wholly owned subsidiary of the Company, acquired 50% 
of the issued share capital of Aspirations Limited (“Aspirations”), the owner of a site (Hoxton, London) on which the 
Company plans to develop a new apart-hotel under the “art’otel” brand. The consideration for the 50% interest in 
Aspirations was €3 million in cash. In addition, Apex advanced a loan of approximately €8 million to Aspirations. 
Following completion, Aspirations will be indebted to each of its shareholders for the same amount and on the same 
terms. The consideration for the shares and the loan from Apex to Aspirations was funded by the Company from its 
existing cash resources. Park Plaza Hotels Europe B.V. (a subsidiary of the Company) has entered into an agreement 
with Aspirations to operate and manage the hotel for an initial term of 20 years from the opening of the hotel. 
c. Investments in WM/DMREF Bora B.V.:
In April 2008, Euro Sea Hotels N.V., a wholly owned subsidiary of the Company, acquired 20% of the shares of 
WM/DMREF Bora B.V. (“Bora”) from a group of real estate investment funds. As part of the transaction, the 
Company is also acquiring 20% of the debt currently provided to Bora by its shareholders.  The total consideration 
of the acquisition, including the debt being acquired, is €22.3 million, which was funded by the Company from its 
existing cash resources. 
Bora currently owns approximately 74% of Arenaturist, a public company listed on the Zagreb (Croatia) Stock 
Exchange, and 100% of three related private companies. These companies together own eight hotels and five 
apartment complexes in and around Pula on the Istrian coast of Croatia.
d. New framework management agreement: 
Park Plaza Hotels Europe B.V. (PPHE), a wholly owned subsidiary of the Company, has entered into an agreement 
to operate up to 20 new hotels (with a total of approximately 3,500 to 4,000 rooms) in Russia under 20-year 
management contracts. PPHE will also provide technical consulting services, including assisting in the identification 
and planning of the hotels. 78   Park Plaza Hotels Annual Report 2007
       As at 31 December, 2007 
      Note €’000
Assets
Non-current assets
Investment in subsidiaries      2  107,753
Loans to group companies      3  193,213
         300,966
Current assets
Other receivables and prepayments       4  404
Cash and cash equivalents      5  103,517
         103,921
Total assets        404,887
 
Equity and liabilities
Equity
Issued capital        –
Share premium         232,879
Currency translation reserve        (31,376)
Accumulated surplus        202,527
Total equity        404,030
Current liabilities
Group companies payable      6  455
Other payables and accruals       7  402
Total liabilities        857
 
Total equity and liabilities        404,887
The accompanying notes are an integral part of the company financial statements. 
 
Adopted on: 15 May 2008.
Chen Moravsky, Chief Financial Officer.     Boris Ivesha, President and Chief Executive Officer.
Company balance sheet Park Plaza Hotels Annual Report 2007   79  
      For the period ended 31 December 2007
1
      Note €’000
Revenues        –
Operating expenses        (409)
EBIT        (409)
Financial expense      8  (2,914)
Financial income      9  25,180
Dividend income      10  180,670
Profit before tax        202,527
Income taxes (the benefit)        –
Profit for the period        202,527
1 See Note 1.
The accompanying notes are an integral part of the company financial statements.
 
Company income statement  80   Park Plaza Hotels Annual Report 2007
    Share Share  Translation Accumulated Total 
    capital premium reserve surplus equity 
    €’000 €’000 €’000 €’000 €’000
At incorporation on 14 June 2007    – – – – –
Issue of shares to acquire Park Plaza Cooperatief U.A.   – 107,771 – – 107,771
Issue of shares to acquire Golden Wall Ltd.    – 4,550 – – 4,550
Issue of shares upon IPO on AIM    – 125,508 – – 125,508
IPO expenses    – (9,018) – – (9,018)
Acquisition of art’otel rights    – 4,000 – – 4,000
Share-based payment    – 68 – – 68
Movement translation reserve    – – (31,376) – (31,376)
Result for the period    – – – 202,527 202,527
At 31 December 2007    – 232,879 (31,376) 202,527 404,030
The accompanying notes are an integral part of the company financial statements.
Company statement of changes in equity Park Plaza Hotels Annual Report 2007   81  
      For the period ended 31 December
1
 2007 
      €’000
Cash flows from operating activities
Profit/(loss) for the period        202,527
Adjustment to reconcile profit/(loss) to cash provided by operating activities (a)     (204,789)
Net cash provided by operating activities        (2,262)
Cash flows from investing activities
Loans to related parties        (3,540)
Net cash provided by/(used in) investing activities        (3,540)
Cash flows from financing activities
Proceeds from issuance of new shares        116,490
Net cash provided by financing activities        116,490
Increase/(decrease) in cash and cash equivalents        110,688
Net foreign exchange differences        (7,171)
Cash and cash equivalents at beginning of period        –
Cash and cash equivalents at end of period        103,517
1 See Note 1.
The accompanying notes are an integral part of the company financial statements. 
Company statement of cash flow  82   Park Plaza Hotels Annual Report 2007
      For the period ended 31 December
1
 2007 
      €’000
(a) Adjustment to reconcile profit/(loss) to net cash provided by operating activities
 Changes in operating assets and liabilities  
 Increase in loans to related parties        (204,786)
 Increase in trade and other receivables        (428)
 Increase in trade and other payables        425
         (204,789)
(b) Supplemental disclosure of cash flows
 Cash received during the year
 Interest         3,076
(c) Significant non-cash transactions
 Shares issued to acquires the Park Plaza Cooperatief U.A.       107,771
 Shares issued to acquire Golden Wall Ltd.        4,550
 Shares issued to acquire intangibles        4,000
1 See Note 1.
The accompanying notes are an integral part of the company financial statements.
Company statement of cash flow
continued Park Plaza Hotels Annual Report 2007   83  
Notes to the Company financial statements
Note 1 Significant accounting policies
The Parent Company has prepared its Annual Report in accordance with Companies (Guernsey) Law 1994. The 
Parent Company, in preparing the Annual Accounts of the legal entity, applies all International Financial Reporting 
Standards (IFRS) and statements as approved by the European Union.
The Parent company financial statements are presented in Euro. As the Company was incorporated in June 2007, 
comparative data for 2006 was not presented.
The accounting policies adopted are consistent with those of the consolidated financial statements, except for the 
investment in subsidiaries that are stated at cost.
Note 2 Investment in subsidiaries
       As at 31 December 2007 
       €’000
Balance as of 1 January 2007        –
  
Acquisitions Park Plaza Cooperatief U.A.        111,771
Acquisition Golden Wall Ltd.        4,550
Share based payments        68
Translation adjustments        (8,636)
Balance as of 31 December 2007        107,753
Note 3 Loans to Group companies
      Interest % As at 31 December 2007 
       €’000
Park Plaza Hotels Europe B.V.     12 month EURIBOR +3%  183,010
Park Plaza Hotels Europe (Germany) B.V.     12 month EURIBOR +3%  1,193
Park Vondel Hotel Holding B.V.      12 month EURIBOR+3%  4,628
Park Plaza Nuremberg GmbH     12 month EURIBOR +2.5%  4,382
         193,213
All loans are denominated in Euro and no agreement about redemption has been made.
Note 4 Other receivables and prepayments
       As at 31 December 2007 
       €’000
Interest receivable        83
Prepaid expenses         321
         404
Note 5 Cash and cash equivalents
Cash at banks earns interest at floating rates based on daily bank deposit rates. Included in the cash at bank are 
short-term deposits for varying periods of between one day and three months, depending on the immediate cash 
requirements of the Group, and earn interest at the respective short-term deposit rates. 84   Park Plaza Hotels Annual Report 2007
Note 6 Group companies payable
       As at 31 December 2007 
       €’000
Park Plaza Hotels Europe B.V.        333
Euro Sea Hotels N.V.        122 
         455
The Group companies payables bear no interest and no agreement about redemption has been made.
Note 7 Other payables and accruals
       As at 31 December 2007 
       €’000
Creditors        131
Other accruals        271
         402
Note 8 Financial expenses
The financial expenses included in the profit and loss account fully relate to a fee paid for the amendment of a loan 
facility.
Note 9 Financial income
       Year ended 31 December 2007 
       €’000
Interest group company loans        6,473
Interest deposit        3,076
Foreign exchange results        15,631
         25,180
Note 10 Dividend income
The dividend income relates to a dividend in kind at IPO date from the subsidiary Golden Wall Ltd. The dividend in 
kind included the group companies loans receivables at that date from Park Plaza Hotels Europe B.V., Park Plaza 
Hotels Europe (Germany) B.V. and Park Vondel Hotel Holding B.V. 
Notes to the Company financial statements
continued Park Plaza Hotels Annual Report 2007   85  
Appendix A: Subsidiaries and investments included in the Euro Sea Group
     Country of Direct and indirect  
Euro Sea Group:  Principal activity incorporation holdings %
Euro Sea Hotels N.V  Hotel operation  
   and management The Netherlands 100
The Mandarin Hotel B.V.  Hotel operation The Netherlands 100
Suf Holdings B.V.  Holding company The Netherlands 100
Victory Enterprises I B.V.  Holding company The Netherlands 100
Victory Monument B.V.  Holding company The Netherlands 50
V.H.R.I. B.V.  Holding company The Netherlands 50
V.H.R.M.S. B.V.  Hotel operation The Netherlands 50
Utrecht Victoria Hotel B.V.  Hotel operation The Netherlands 50
Victoria Hotel C.V.  Hotel operation The Netherlands 50
Riverbank Hotel Operator Ltd.  Hotel operation United Kingdom 45
Riverbank Hotel Holding B.V.  Hotel operation The Netherlands 45
Victoria London Hotel Holding B.V.  Hotel operation The Netherlands 45
Victoria Park Plaza Operator Ltd.  Hotel operation United Kingdom 45
Victoria Pub Holdings B.V.  Hotel operation The Netherlands 45
Sherlock Holmes Park Plaza Ltd.  Management United Kingdom 45
Grandis Netherlands Holding B.V.  Management The Netherlands 45
Marlbray Limited  Hotel operation United Kingdom  33.3
 
Appendix B: Subsidiaries and investments included in the Park Plaza Group
     Country of Direct and indirect 
Park Plaza Group:  Principal activity incorporation holdings %
Park Plaza Hotels Europe Holdings B.V.  Holding company The Netherlands 100
Park Plaza Hotels Europe B.V.  Management The Netherlands 100
Park Plaza Hotels (Germany) Services GmbH  Management Germany 100
Park Plaza Hotels Europe (Germany) B.V  Management The Netherlands 100
Sugarhill Investments B.V.  Holding company The Netherlands 100
Park Plaza Germany Holdings GmbH  Holding company Germany 100
Park Plaza Berlin Hotelbetriebsgesellschaft GmbH  Hotel operation Germany 100
Park Plaza Dresden Hotelbetriebsgesellschaft GmbH  Hotel operation Germany 100
Park Plaza Wallstrasse Hotelbetriebsgesellschaft GmbH  Hotel operation Germany 100
art’otel Berlin Mitte/Park Plaza Betriebsgesellschaft GmbH  Hotel operation Germany 100
art’otel Berlin City Center West GmbH  Hotel operation Germany 100
art’otel Dresden/Park Plaza Betriebsgesellschaft GmbH  Hotel operation Germany 100
art’otel Budapest Szállodaüzemelteto Kft  Hotel operation Hungary 100
Park Vondel Hotel Holding B.V.  Hotel operation The Netherlands 100
Park Vondel Hotel Real Estate B.V.  Holding company The Netherlands 100
Park Vondel Hotel Management B.V.  Holding company The Netherlands 100
Golden Wall Investments Limited  Finance company BVI 100
Riverbank Hotel Operator Ltd.  Hotel operation United Kingdom 10
Riverbank Hotel Holding B.V.  Hotel operation The Netherlands 10
Victoria London Hotel Holding B.V.  Hotel operation The Netherlands 5
Victoria Park Plaza Operator Ltd.  Hotel operation United Kingdom 5
Victoria Pub Holdings B.V.  Hotel operation The Netherlands 5
Sherlock Holmes Park Plaza Ltd.  Management United Kingdom 10
Grandis Netherlands Holding B.V.  Management The Netherlands 10
Appendices to the financial statements 86   Park Plaza Hotels Annual Report 2007
Appendix C: Subsidiaries included in the Group
        Proportion of 
     Country of  ownership  
Name of subsidiary Principal activity  incorporation  interest %
Park Plaza Cooperatief UA  Holding company The Netherlands 100
Euro Sea Hotels N.V.  Holding company The Netherlands 100
Suf Holdings B.V.  Holding company The Netherlands 100
The Mandarin Hotel B.V.  Hotel operation The Netherlands 100
Victory Enterprises I B.V.  Holding company The Netherlands 100
Park Plaza Hotels Europe Holdings B.V. Holding company The Netherlands 100
Park Plaza Hotels Europe B.V.  Management The Netherlands 100
Park Plaza Hotels (Germany) Services GmbH Management Germany 100
Park Plaza Hotels Europe (Germany) B.V Management The Netherlands 100
Park Plaza Hotels (U.K.) Services Ltd  Management United Kingdom 100
Sugarhill Investments B.V.  Holding company The Netherlands 100
Park Plaza Germany Holdings GmbH  Holding company Germany 100
Park Plaza Berlin Hotelbetriebsgesellschaft GmbH Hotel operation Germany 100
Park Plaza Dresden Hotelbetriebsgesellschaft GmbH Hotel operation Germany 100
Park Plaza Wallstrasse Hotelbetriebsgesellschaft GmbH Hotel operation Germany 100
art’otel Berlin Mitte/Park Plaza Betriebsgesellschaft GmbH Hotel operation Germany 100
Park Plaza Nuremberg GmbH  Hotel operation Germany 100
art’otel Berlin City Center West GmbH  Hotel operation Germany 100
art’otel Dresden/Park Plaza Betriebsgesellschaft GmbH Hotel operation Germany 100
art’otel Budapest Szállodaüzemelteto Kft Hotel operation Hungary 100
Appendix D: Jointly controlled entities included in the Group
  
        Proportion of 
     Country of  ownership  
Name of company Principal activity  incorporation  interest %
V.H.R.I. B.V. Holding company  The Netherlands  50
V.H.R.M.S. B.V. Hotel operation  The Netherlands  50
Utrecht Victoria Hotel B.V. Hotel operation  The Netherlands  50
Victoria Hotel C.V. Hotel operation  The Netherlands  50
Victoria Monument B.V. Hotel operation  The Netherlands  50
Riverbank Hotel Operator Ltd. Hotel operation  United Kingdom  55 
Riverbank Hotel Holding B.V. Holding company  The Netherlands  55
Victoria London Hotel Holding B.V. Holding company  The Netherlands  50
Victoria Park Plaza Operator Ltd. Hotel operation  United Kingdom  50 
Sherlock Holmes Park Plaza Ltd. Hotel operation  United Kingdom  55
Grandis Netherlands Holding B.V. Holding company  The Netherlands  55
Victoria Pub Holdings B.V. Holding company  The Netherlands  50
Appendices to the financial statements
continued Auditors’ report
To the Members of Park Plaza Hotels Limited
We have audited the consolidated and parent company 
financial statements (“the financial statements”) for 
the year ended 31 December 2007 which comprise 
the Consolidated and Company balance sheet, the 
Consolidated and Company income statement, the 
Consolidated and Company statement of changes 
in equity, the Consolidated and Company statement 
of cash flow and the related notes. These financial 
statements have been prepared under the accounting 
policies set out therein.
This report is made solely to the company’s members, 
as a body, in accordance with Section 64 of the 
Companies (Guernsey) Law 1994. Our audit work has 
been undertaken so that we might state to the company’s 
members those matters we are required to state to them 
in an auditors’ report and for no other purpose. To the 
fullest extent permitted by law, we do not accept or 
assume responsibility to anyone other than the company 
and the company’s members as a body, for our audit 
work, for this report, or for the opinions we have formed.
Respective responsibilities of directors and auditors
The directors are responsible for the preparation of 
the financial statements in accordance with applicable 
Guernsey law as set out in the Statement of Directors’ 
Responsibilities.
Our responsibility is to audit the financial statements 
in accordance with relevant legal and regulatory 
requirements and International Standards on Auditing 
(UK and Ireland).
We report to you our opinion as to whether the financial 
statements give a true and fair view and are properly 
prepared in accordance with the Companies (Guernsey) 
Law 1994. We also report to you if, in our opinion, the 
company has not kept proper accounting records or if 
we have not received all the information and explanations 
we require for our audit.
We read other information contained in the Annual 
Report and consider the implications for our report if we 
become aware of any apparent misstatements within it. 
The other information comprises the Strategy statement 
and financial highlights, Park Plaza Hotels at a glance, 
the Chairman’s statement, the President and CEO’s 
statement and operational review, the Strategic plan 
and development, Market review and Corporate 
governance (including the Statement of Directors’ 
Responsibilities). Our responsibilities do not extend 
to any other information.
Basis of audit opinion
We conducted our audit in accordance with International 
Standards on Auditing (UK and Ireland) issued by the 
Auditing Practices Board. An audit includes examination, 
on a test basis, of evidence relevant to the amounts and 
disclosures in the financial statements. It also includes an 
assessment of the significant estimates and judgments 
made by the directors in the preparation of the financial 
statements, and of whether the accounting policies are 
appropriate to the company’s circumstances, consistently 
applied and adequately disclosed.
We planned and performed our audit so as to obtain all 
the information and explanations which we considered 
necessary in order to provide us with sufficient evidence 
to give reasonable assurance that the financial statements 
are free from material misstatement, whether caused 
by fraud or other irregularity or error. In forming our 
opinion we also evaluated the overall adequacy of the 
presentation of information in the financial statements.
Opinion
In our opinion the financial statements give a true and 
fair view, in accordance with International Financial 
Reporting Standards, of the state of the Group and 
Company’s affairs as at 31 December 2007 and of the 
Group and Company’s results for the year then ended 
and have been properly prepared in accordance with 
the Companies (Guernsey) Law 1994.
 
Guernsey, Channel Islands
Date: 20 May 2008
Park Plaza Hotels Annual Report 2007   87   Notice of AGM
Park Plaza Hotels Limited
(Registered in Guernsey under number 47131)
Notice is hereby given that the first Annual General 
Meeting of the Company will be held at St. Pierre Park 
Hotel, Rohais, St. Peter Port, Guernsey, GY1 1FD, 
Channel Islands on 30 June 2008 at 12.00 noon for the 
following purposes:
Ordinary business
To consider and, if thought fit, pass the following 
resolutions as Ordinary Resolutions:
1 that the Report of the Directors and the Accounts of 
the Company for the year ended 31 December 2007 
together with the report of the auditors be received;
2 that Ernst & Young LLP be re-appointed as auditors of 
the Company for the ensuing year and to authorise the 
Directors to determine their remuneration; and
3 that Eli Papouchado, Elisha Flax, Kevin McAuliffe and 
Nigel Jones who had indicated their willingness to 
continue in office, be re-elected Directors of the 
Company, as required by Article 17.6 of the 
Company’s Articles of Association.
Dated: 4 June 2008
By Order of the Board
C.L. Secretaries Limited
Company Secretary
Administration Office
1st and 2nd Floors,  
Elizabeth House, Les Ruettes Brayes, St. Peter Port,  
Guernsey GY1 1EW, Channel Islands.
Notes
1  Any member entitled to attend and vote at the Meeting may appoint 
one or more proxies to attend and, on a poll, vote in his stead. Such 
proxy need not be a member of the Company.
2  To be valid, the form of proxy must be returned in accordance 
with the instructions printed thereon not later than 12.00 noon 
on 28 June 2008. Proxies should be returned to Capita Registrars, 
(Proxies), The Registry, 34 Beckenham Road, Beckenham, 
Kent BR3 4TU, United Kingdom.
3  Completion and return of a form of proxy will not prevent a member 
from attending and voting at the meeting should he so wish.
4 CREST members who wish to appoint a proxy or proxies through 
the CREST electronic proxy appointment service may do so by using 
the procedures described in the CREST Manual. CREST personal 
members or other CREST sponsored members and those CREST 
members who have appointed voting service provider(s), should 
refer to their CREST sponsor or voting service provider(s) who will 
be able to take the appropriate action on their behalf.
 In order for a proxy appointment or instruction made using 
the CREST service to be valid, the appropriate CREST message 
(a “CREST Proxy Instruction”) must be properly authenticated 
in accordance with Euroclear UK & Ireland Limited’s (formerly 
CRESTCo’s) specifications and must contain the information 
required for such instructions, as described in the CREST Manual. 
The message, regardless of whether it constitutes the appointment 
of a proxy or an amendment to the instruction given to a 
previously appointed proxy, must in order to be valid, be 
transmitted so as to be received by Capita Registrars (ID RA 10) 
by no later than 12.00 noon on 28 June 2008. No such message 
received through the CREST network after this time will be 
accepted. For this purpose, the time of receipt will be taken to be 
the time (as determined by the timestamp applied to the message 
by the CREST Applications Host) from which the registrars are 
able to retrieve the message by enquiry to CREST in the manner 
prescribed by CREST. After this time, any change of instructions 
to proxies appointed through CREST should be communicated 
to the appointee through other means. 
 CREST members and, where applicable, their CREST sponsors or 
voting service provider(s) should note that Euroclear UK & Ireland 
Limited does not make available special procedures in CREST for 
any particular message. Normal system timings and limitations will 
therefore apply in relation to the input of CREST Proxy Instructions. 
Is it the responsibility of the CREST member concerned to take 
(or, if the CREST member is a CREST personal member or 
sponsored member or has appointed a voting service provider(s), 
to procure that his CREST sponsor or voting service provider(s) 
take(s)) such action as shall be necessary to ensure that a message 
is transmitted by means of the CREST system by any particular 
time. In this connection, CREST members and, where applicable, 
their CREST sponsors or voting service providers are referred, in 
particular, to those sections of the CREST Manual concerning 
practical limitations of the CREST system and timings.
 The Company may treat as invalid a CREST Proxy Instruction in the 
circumstances set out in Regulation 35(5)(a) of the Uncertificated 
Securities Regulations 2001. 
5 Pursuant to Regulation 41 of the Uncertificated Securities 
Regulations 2001, only those shareholders registered in the register 
of members of the Company as at 6.00 p.m. on 28 June 2008 or, if 
this meeting is adjourned, at 6.00 p.m. on the day two days prior to 
the adjourned meeting shall be entitled to attend and vote at the 
Annual General Meeting in respect of the number of shares registered 
in their name at that time. Changes to entries on the relevant register 
of securities after 6.00 p.m. on 28 June 2008 or, if this meeting is 
adjourned, at 6.00 p.m. on the day two days prior to the adjourned 
meeting, shall be disregarded in determining the rights of any person 
to attend or vote at this Annual General Meeting.
88   Park Plaza Hotels Annual Report 2007 Useful contacts
Directors
Eli Papouchado
Boris Ivesha
Chen Moravsky
Elisha Flax
Kevin McAuliffe
Nigel Jones
Park Plaza Hotels  
Corporate Office
Hasselaerssteeg 11
1012 MB Amsterdam
The Netherlands
Tel: +31 (0) 20 713 8200
Fax: +31 (0) 20 524 0651
Email: cmoravsky@pphe.com
Web: parkplazahotels.net
Contacts
Chen Moravsky,  
Chief Financial Officer and  
Board Member
Robert Henke,  
Vice President Marketing
Administrator
C.L. Secretaries Limited
1st Floor
Elizabeth House
Les Ruettes Brayes
St. Peter Port
Guernsey GY1 4LX
Channel Islands
Independent Auditors
Ernst & Young LLP
14 New Street
St. Peter Port
Guernsey GY1 4AF
Channel Islands
Legal Advisors
Norton Rose
3 More London Riverside
London SE1 2AQ
United Kingdom
Carey Olsen
7 New Street
St. Peter Port
Guernsey GY1 4BZ
Channel Islands
Registered Office
22 Smith Street
St. Peter Port
Guernsey GY1 2JQ
Channel Islands
Broker
Morgan Stanley Securities Limited
25 Cabot Square
Canary Wharf
London E14 4QA
United Kingdom
Registrar
Capita Registrars (Guernsey) Limited
2nd Floor
1 Le Truchot
St. Peter Port
Guernsey GY1 1WD
Channel Islands
Secretary
C.L. Secretaries Limited
1st Floor
Elizabeth House
Les Ruettes Brayes
St. Peter Port
Guernsey GY1 4LX
Channel Islands
Nominated Adviser
Morgan Stanley & Co. International plc
25 Cabot Square
Canary Wharf
London E14 4QA
United Kingdom
Financial Public Relations
Hudson Sandler
29 Cloth Fair
London EC1A 7NN
United Kingdom
This annual report is printed  
on FSC-certified paper
Designed and produced by  
greymatter williams and phoa
Printed by Granite
TT-COC-002238
Park Plaza Hotels Annual Report 2007   89   Park Plaza Hotels Corporate Office
Hasselaerssteeg 11, 1012 MB Amsterdam, The Netherlands
Tel: +31 (0) 20 713 8200  Fax: +31 (0) 20 524 0651
www.parkplazahotels.net
P ARK PLAZA  HOTELS