annual report 2010 
delivering on our strategy 
and shaping our future park plaza hotels at a glance
understanding our business
park plaza hotels’ primary activities are owning leasing developing operating and franchising full service  
fourstar fourstar deluxe and lifestyle hotels in major gateway cities and regional centres predominantly in europe 
the majority of our hotels operate under two distinct brands park plaza
®
 hotels  resorts and art’otel
®
 
the company has an exclusive licence from carlson a global privately held hospitality and travel company  
to develop and operate park plaza
®
 hotels  resorts in europe the middle east and africa the art’otel
®
 brand  
is fully owned by the company
our portfolio of owned leased managed and franchised hotels comprises 38 hotels offering a total of 8316 rooms 
of these 2869 rooms are owned by the arenaturist group one of croatia’s leading hospitality groups in which we 
have a minority ownership interest we are also working on projects relating to three new hotels and an extension 
to an existing hotel which together are expected to add a further 692 rooms to the portfolio by the end of 2013
our brands
individual design city centre locations 
and excellent meeting facilities are key 
features of the upmarket park plaza
®
 
hotels  resorts brand making it 
ideal for both corporate and leisure 
guests the hotels’ modern function 
spaces are flexible for conferences 
exhibitions and private event use 
park plaza
®
 hotels  resorts’ event 
facilities are perfectly complemented 
by stylish guest rooms awardwinning 
restaurants and bars and a reliable 
service that is flawlessly delivered
wwwparkplazacom
art’otel
®
 is a contemporary collection 
of hotels that fuse exceptional 
architectural style with artinspired 
interiors located in cosmopolitan 
centres across europe at the brand’s 
core is the art itself each hotel 
displays a collection of original works 
designed or acquired specifically for 
each art’otel
®
 rendering each a unique 
art gallery in their own right art’otel
®
 
has created a niche for itself in the 
hotel world differentiating it from 
traditional hotels 
wwwartotelscom
arenaturist is one of croatia’s best 
known hospitality groups and consists 
of eight hotels five holiday apartment 
complexes eight campsites and 52 
food and beverage outlets all of which 
are located in istria arenaturist caters 
primarily for tourists and all properties 
are located in prime locations by the 
sea and are only a short distance from 
either the 3000 year old city of pula  
or the touristic medulin  
 
wwwarenaturistcom
history of growth
1989199519962000 2001200520062011
1
3
4
8
5
18
6
38
number of countries
number of hotels
key strengths
•	 high quality portfolio with an 
attractive geographical spread
•	 two distinct brands with significant  
upside potential
•	 integrated approach of hotel  
and brand ownership and operation
•	 powerful distribution network 
through the partnership with 
carlson
•	 focus on the expanding affordable 
luxury market segment  current portfolio
geographic spread
united kingdom
rooms in operation 
2893
rooms pipeline 
352
owned hotels
park plaza leeds
park plaza nottingham
park plaza riverbank london
park plaza sherlock holmes 
london
park plaza victoria london
plaza on the river – london
park plaza westminster bridge 
london
managed hotels 
park plaza county hall london
franchised hotels
park plaza belfast
park plaza cardiff
under development
art’otel london hoxton
the netherlands
rooms in operation 
1010
rooms pipeline 
105
owned hotels
park plaza eindhoven
park plaza vondelpark 
amsterdam
coowned hotels
park plaza utrecht
park plaza victoria amsterdam
park plaza amsterdam airport
under development
art’otel amsterdam
israel
rooms in operation 
182
franchised hotel
park plaza orchid tel aviv
germany
rooms in operation 
1197
rooms pipeline 
235
leased hotels
art’otel berlin city center west
art’otel berlin kudamm
art’otel berlin mitte
art’otel cologne
art’otel dresden 
park plaza prenzlauer berg berlin
park plaza wallstreet berlin
franchised hotels
park plaza trier
under development
park plaza nuremberg
extension art’otel berlin city  
center west 
hungary
rooms in operation 
165
leased hotel
art’otel budapest
croatia
rooms in operation 
2869
coowned hotels
hotel histria 
hotel medulin
hotel brioni
hotel park 
hotel palma 
hotel holiday 
hotel belvedere
guest house riviera
coowned resorts
verudela beach and villas resort
punta verudela resort
horizont resort
splendid resort 
ai pini medulin resort 
hotel portfolio contract mix park plaza
®
 global brand portfolio art’otel
®
12
3
4
8
14
 
ownership of 50 or more
  
operated without or with minority  
ownership interest
 
operating leases
 
franchise agreements
 
projects all ownership of 50 or more
 
park plaza
®
 hotels open in rest of world
1
  
park plaza
®
 hotels open in emea
  
park plaza
®
 hotels under development  
in emea
  
park plaza
®
 hotels under development  
in rest of world
1
 
art’otels
®
 open
  ar t ’ o t el s
®
 under development
1  these hotels are managed or franchised directly by carlson
6
2
13
19
1
19
  room count excludes arenaturist’s campsites other than the kažela camp cover park plaza westminster bridge london
this page art’otel cologne 2010 highlights
a year of achievements
2010 highlights 
•	 total group revenue increased by 74 1 to 
€1398 million 2009 €803 million
•	 ebitda increased by 132 1 to €37 6 
million 2009 €162 million
•	 1579 rooms were added to the group’s 
hotel portfolio in 2010
 – group’s prestigious flagship hotel park 
plaza westminster bridge london 
partially opened in march 2010 followed 
by a full opening in september 2010
 – newly built art’otel cologne germany 
opened in march 2010
 – acquisition of a large conference hotel 
near amsterdam schiphol airport and 
rebranded to park plaza amsterdam 
airport in april 2010
•	 park plaza leeds and park plaza 
nottingham now fullyowned and continue 
to be operated by the group 
•	 successful refinancing of park plaza victoria 
london park plaza riverbank london 
including plaza on the river and park plaza 
sherlock holmes london in november 2010
•	 ownership interest in park plaza victoria 
london park plaza riverbank london 
including plaza on the river and park  
plaza sherlock holmes london increased  
to 100 in december 2010
•	 net debt reduced by €340 million to  
€3699 million at 31 december 2010
201 1 highlights to date
•	 successful refinancing of park plaza 
westminster bridge london in june 201 1
•	 extensive renovations carried out  
in four hotels in the netherlands  
germany and hungary
•	 park plaza awarded “best small or 
independent hotel brand” by the uk 
business travel awards 
•	 launch of competitive new guest loyalty 
programme named club carlson
sm 
including introduction of new mobile app
•	 strong focus on growing the contribution  
of online channels including the 
introduction of three new languages on  
parkplazacom and the planned launch  
of mobile websites and applications
financial highlights
y ear ended 31 december 2010
y ear ended 31 december 2009
revpar
1
€8570
€7740
1 revenue per available room
t otal revenue
€1398m
€803m
ebitda
€376m
€162m

  2009 ebitda has been restated to reflect the  
adoption of the new ifrs standards
occupancy
774
791
average room rate
€11070
€9780
contents
01 2010 highlights
02 financial kpis
03 chairman’s statement
04 chief executive officer’s statement
06 strategy and performance
08  driving revenue growth through 
expanding our asset portfolio 
10  increasing profitability through innovative  
revenue generation and costeffective 
management 
12  utilising the carlson partnership to  
market the group’s business and further 
grow revenues 
14   improving operational performance 
through better service quality 
16   improving our financial performance  
and structure
18 chief financial officer’s statement
20 review of 2010
20 united kingdom
22 the netherlands
24 germany and hungary
26 management and holdings operations
2 8  c r o a t i a
30 corporate social responsibility
3 2  d i rec t o r s ’ re p o r t
36 corporate governance
40  report of the remuneration committee 
and directors’ remuneration report
42 board of directors
44 financial statements
93 independent auditors’ report 
94 current and committed projects 
95 contacts
forwardlooking statements
this annual report and financial statements may contain 
certain “forwardlooking statements” which reflect the 
company’s andor the directors’ current views with  
respect to financial performance business strategy and 
future plans both with respect to the group and the sectors 
and industries in which the group operates statements 
which include the words ‘‘expects’’ ‘‘intends’’ ‘‘plans’’ 
‘‘believes’’ ‘‘projects’’ ‘‘anticipates’’ ‘‘will’’ ‘‘targets’’ 
‘‘aims’’ ‘‘may’’ ‘‘would’’ ‘‘could’’ ‘‘continue’’ and similar 
statements are of a future or forwardlooking nature all 
forwardlooking statements address matters that involve 
risks and uncertainties accordingly there are or will be 
important factors that could cause the group’s actual 
results to differ materially from those indicated in these 
statements any forwardlooking statements in this annual 
report and financial statements reflect the group’s current 
views with respect to future events and are subject to risks 
uncertainties and assumptions relating to the group’s 
operations results of operations and growth strategy
these forwardlooking statements speak only as of the  
date of this annual report and financial statements 
subject to any legal or regulatory obligations the company 
undertakes no obligation publicly to update or review 
any forwardlooking statement whether as a result of 
new information future developments or otherwise all 
subsequent written and oral forwardlooking statements 
attributable to the group or individuals acting on behalf 
of the group are expressly qualified in their entirety by 
this paragraph nothing in this publication should be 
considered as a profit forecast
park plaza hotels annual report 2010   1 park plaza westminster bridge london 
financial kpis
we benefited from a recovery in all of our markets  
resulting in a year on year increase of 132 a result  
which was further boosted by the opening of park plaza 
westminster bridge london 
for 2010 we reported our highest ever ebitda with a year 
on year growth of 1321 we started to benefit from our 
development pipeline 
reported revpar increased year on year by 107 primarily 
reflecting a strong improvement in average room rates in 
particular our established london hotels performed well 
our total revenue increased by 741 to an impressive  
€1398 million we benefited from new openings and 
acquisitions as well as recovering markets 
average room rate
2007 2008 2009 2010
like for like 
2010
actual 
€11880
€11390
€9780
€10770
€11070
ebitda in € million
2007 2008 2009 2010
like for like 
2010
actual 
€284
€254
€162
€197
€376
revpar
2007 2008 2009 2010
like for like 
2010
actual 
€9710
€9030
€7740
€8630
€8570
revenue in € million
2007 2008 2009 2010
like for like 
2010
actual 
€970
€934
€803 €812
€1398
2   park plaza hotels annual report 2010 dear shareholders
i am proud of the significant progress that 
we have made during the year as trading 
conditions improved across all the markets  
in which we operate 
in recent years the global hotel industry has 
had to cope with an exceptionally turbulent 
environment as a result of the global economic 
downturn and financial crisis during which 
the industry witnessed an unprecedented 
reduction in travel demand resulting in an 
industrywide fall in revpar
the pressure on revpar alongside a lack 
of available financing from the global 
financial markets have also constrained the 
development pipeline of many hoteliers 
during 2010 the overall european hotel 
performance improved with year on year 
revpar growth in most european city markets  
source tri hospitality hotstats 2010
against this background i am pleased to 
report a strong financial performance for the 
year to 31 december 2010 which exceeded 
the board’s expectations with the group’s 
established hotels in london and amsterdam 
outperforming their competitive sets in terms 
of revpar str global december 2010 
our other achievements included the 
expansion of our portfolio through the 
addition of 1579 rooms achieved through 
the delivery of projects in our development 
pipeline and through hotel acquisitions in 
particular after ten years in planning and 30 
months of construction we were delighted to 
open our flagship 1019 room hotel park plaza 
westminster bridge london one of the largest 
hotels to open in london 
feedback from guests and clients on our 
newly built hotels in london and cologne has 
been very encouraging and in their first year 
of operation they already received high scores 
in our guest satisfaction system won several 
awards and accreditations and experienced 
high levels of returning guests 
our people are at the core of park plaza hotels’ 
success and we recognise the importance of 
training connect our companywide training 
programme was launched in 2008 to ensure 
that all of our employees are well trained in 
their roles to enable them to consistently exceed 
guest expectations the training programme 
remains very successful in improving the 
performance of our staff improving job 
satisfaction and maintaining the highest level  
of service for our guests 
i am particularly proud that we have 
experienced unprecedented guest and 
employee satisfaction levels in 2010 and i 
would like to take this opportunity to thank all 
our employees on behalf of the board for their 
hard work professionalism and commitment 
during the year i am profoundly grateful to 
them for everything they do to ensure that we 
continue to deliver excellent customer service 
to our guests 
our strategy remains unchanged as we strive 
to become one of the leading hotel owners 
developers operators and franchisors of 
high quality fourstar fourstar deluxe and 
contemporary lifestyle hotels predominantly 
in european market we succeeded this year in 
raising our brands’ profile through intensified 
cooperation with our strategic partner  carlson 
our continued focus on operational efficiency 
and our portfolio growth looking forward 
we will remain focused on driving revpar 
maintaining a high quality of service standards 
investing in our hotels and progressing our 
development pipeline as we continue to 
expand and build for the future to the benefit 
of our shareholders guests and employees
the company has not paid any dividends since 
its incorporation but subject to compliance 
with guernsey law and the retention of proper 
and prudent reserves by the company the 
board intends to recommend the payment 
of an annual dividend of at least 3p per share 
commencing in 2012
the board is continually mindful of applying 
high standards of corporate governance 
and in line with the generally high levels of 
activity in the group during the year the audit 
committee has been particularly very active 
details of the audit committee’s activities 
during the year can be found in the directors’ 
report and corporate governance section
the board continues to believe that our  
longterm growth prospects remain attractive 
to further raise park plaza hotels’ profile we 
have recently announced our intention to 
apply for admission of the company’s ordinary 
shares to listing on the standard listing 
segment of the official list of the uk listing 
authority and to trading on the london stock 
exchange’s main market for listed securities
eli papouchado 
chairman
chairman’s statement
the development potential of  
our portfolio positions us well to 
benefit from a market recovery
park plaza hotels annual report 2010   3 chief executive officer’s statement
we are now seeing the benefits  
of our strategic investments
welcome 
2010 was an active and exciting year in our 
development significant progress was made 
on a number of projects and we started to 
benefit from our development pipeline and 
hotel acquisitions 
a key highlight in the year was the opening of 
our flagship hotel the 1019 room park plaza 
westminster bridge london 
a total of 1579 rooms were added to 
the portfolio during the year through the 
addition of two newly built hotels in london 
and cologne and one acquisition near 
amsterdam airport and 123 rooms were 
removed following the termination of a 
franchise agreement in germany bringing the 
total number of rooms operated by us at the 
yearend to approximately 8400 
we also successfully completed the 
refinancing of three of our london hotels 
park plaza victoria london park plaza 
riverbank london including plaza on the 
river and park plaza sherlock holmes 
london and through a subsequent 
transaction we now have full ownership  
of these hotels 
in 2010 trading conditions in all the markets 
in which we operate improved there were 
early signs of recovery in the first half despite 
the travel disruption in northern europe 
as a result of heavy snow in january 2010 
and the unprecedented closure of airspace 
in april 2010 as a result of the volcanic ash 
cloud from iceland this recovery gained 
momentum in the second half of the year as 
demand from both corporate and leisure 
travellers increased 
once again our established london 
hotels – park plaza victoria london park 
plaza riverbank london including plaza 
on the river and park plaza sherlock 
holmes london – performed strongly in 
the year with revpar for each of these 
hotels outperforming the average revpar 
of its competitive set in 2010 str global 
december 2010 
as a result we are pleased to report a strong 
financial performance for the year to  
31 december 2010 which exceeded the 
board’s expectations total reported  
group revenue increased by 741 to  
€1398 million and ebitda grew by 1321  
to €37 6 million as we started to benefit from 
our development pipeline 
portfolio growth 
we significantly extended our presence in the 
affordable luxury hotel market through the 
addition of three hotels to our portfolio 
in march 2010 park plaza westminster 
bridge london was partially opened to 
paying guests followed by its full opening  
in september 2010 as at 31 december 2010 
we completed the sale of 535 units with 484 
units having been retained by the group 
the newly built art’otel cologne in germany 
opened in march 2010 located in a prime 
location on the bank of the river rhine  
this hotel offers 218 rooms excellent  
meeting facilities and has received very 
encouraging customer feedback 
in april 2010 we acquired with a joint 
venture partner a large conference hotel 
with 342 rooms near amsterdam schiphol 
airport the hotel was rebranded park plaza 
amsterdam airport immediately following 
our acquisition
in addition to these new hotels added to 
our portfolio in the year in august 2010 
we acquired the freehold and headlease 
interests of park plaza leeds and park 
plaza nottingham prior to this acquisition 
both hotels were operated and continue 
to be operated by us under longterm 
management agreements 
on 31 december 2010 we acquired the 
remaining joint venture interests in and 
shareholder loans related to park plaza 
victoria london park plaza riverbank 
london including plaza on the river and 
park plaza sherlock holmes london 
strengthening the brands 
our teams continued to maximise the 
benefits available through our strategic 
partnership with carlson one of the world’s 
leading travel and hospitality companies 
which provides us with access to a stateof
theart reservation and global distribution 
platform as well as participation in global 
sales and marketing programmes room 
revenue generated via carlson’s reservation 
system has continued to increase and  
now accounts for approximately 40  
of our room revenue 
this growth is primarily driven by increased 
online marketing initiatives and our active 
engagement in the club carlson
sm
 the former 
goldpoints plus™ guest reward programme 
in 2010 this programme provided us with 
access to a marketing database of over 
63 million guests an increase of 24 in 
number of members compared to 2009 
carlson is planning to double the size of 
club carlson
sm
 to 10 million members 
by 2013 our hotels collectively signed up 
over 47 500 new members in 2010 alone 
various enhancements to the programme 
have made it one of the most attractive in 
the industry and it is now easier and faster 
for guests to collect and redeem points at 
any carlson hotel in early 201 1 a dedicated 
club carlson
sm
 app for mobile devices was 
launched marking the park plaza
®
 brand’s 
debut in this space
we have also invested in our internal 
marketing resources and in particular in  
our online marketing team to grow the 
revenue contribution of both the park plaza
®
  
and art’otel
® 
websites 
service excellence
core to our business is the quality of service 
standards and level of guest satisfaction in 
2008 we introduced a leading online guest 
satisfaction survey system enabling us to 
monitor and improve our guests’ experience 
nearly 39000 guest surveys were completed 
during the year a 35 year on year increase 
and all new hotels and several franchised 
hotels were added to the system in the 
year we are very proud to report that we 
continued to increase our scores across all  
key performance indicators for guest 
satisfaction service and product 
performance and guest loyalty 
4   park plaza hotels annual report 2010 our staff are responsible for the increased 
guest satisfaction levels and their constant 
focus on delivering a high quality service  
has paid off 
we actively engage with our employees and 
with the number of employees increasing 
by 29 primarily as a result of the new 
openings it was vital to successfully deliver 
new uniformed introduction welcome 
packs and our connect service training 
programme we were successful in delivering 
these essential tools on time and we are 
proud to report that overall employee 
satisfaction has increased year on year  
by 27 to a healthy 810
our development projects
alongside the three new hotel openings in the 
year we continued to invest in the planning 
and development of new hotel openings as 
well as renovation and refurbishment projects 
in order to further enhance the quality of  
our hotel portfolio and these projects 
continue in 201 1 
in the united kingdom construction work 
for the 352 room art’otel
®
 located in the 
hoxton area of london is due to commence 
in 201 1 and the hotel is scheduled to open in 
2013 refurbishment projects are planned at 
park plaza leeds and park plaza nottingham 
following our acquisition of these hotels in 
august 2010
in the netherlands we are investing 
approximately €250 million in our portfolio 
in the construction of the art’otel amsterdam 
and extensive refurbishment programmes for 
the flagship park plaza victoria amsterdam 
the newly acquired park plaza amsterdam 
airport the centrally located park plaza 
utrecht and our inaugural hotel park  
plaza eindhoven 
in germany and hungary work has 
commenced on a 60 room extension 
at art’otel berlin city center west and a 
renovation programme will commence at 
art’otel budapest progress in development 
of park plaza nuremberg continues and the 
hotel is expected to open in 2013
we also continued with several refurbishment 
projects across the arenaturist portfolio 
during the year in particular extensive room 
renovations commenced at hotel histria and 
these are due to be completed for the start  
of the 2012 season at several hotels  
the restaurants bars and pool areas were 
also renovated
current trading
whilst the first quarter is historically the 
weakest of the year we are pleased to report 
that we have continued to trade in line with 
the board’s expectations during the three 
months to 31 march 201 1 
as anticipated trading conditions have 
continued to improve across all markets  
in which we operate 
in the united kingdom revpar has grown 
significantly year on year notably our 
london hotels reported a strong increase in 
average room rate and we are now seeing the 
true benefits from the fully operational park 
plaza westminster bridge london 
in the netherlands revpar has also 
increased compared with the first quarter 
of 2010 a result of improved average room 
rates at all of our hotels in the netherlands 
ebitda declined due to fewer rooms being 
available at park plaza victoria amsterdam 
and park plaza eindhoven as a result of 
extensive renovations in the first quarter  
the majority of rooms closed for renovations 
are now open and management is confident 
that we will strongly benefit from these 
improved hotels 
in germany and hungary revpar at our 
hotels during the first quarter improved 
significantly compared to the first quarter in 
2010 this is a particularly good performance 
considering that last year’s revpar 
performance in germany was supported 
by the government’s vat reduction the 
reported growth in revpar is a result of 
increased average room rates and has been 
further improved by the art’otel cologne 
which opened mid march 2010 
the ebitda loss was also reduced during the 
first quarter of 201 1 as we started to benefit 
from renegotiated lease agreements and 
improved trading conditions 
our management and holdings  
operation has performed in line with  
the board’s expectations 
looking forward we remain focused on 
continuing to improve overall performance 
fundamentally by growing average room 
rates and maintaining careful cost control 
we will continue to progress our confirmed 
development projects and are actively 
exploring new growth opportunities 
boris ivesha 
president and chief executive officer
park plaza hotels annual report 2010   5 
strategy and performance
measuring our success
driving revenue growth  
through expanding our  
asset portfolio 
increasing profitability through 
innovative revenue generation and 
costeffective management 
utilising the carlson partnership  
to market the group’s business  
and further grow revenues 
improving operational  
performance through  
better service quality 
improving our financial  
structure and performance 
performance
we completed two newly built projects acquired and 
rebranded one existing hotel acquired two hotels previously 
operated by us and acquired the remaining interests in three 
central london hotels from our joint venture partner 
performance
on a like for like basis we delivered a strong revpar growth 
across all regions heavily supported with a wide range of 
tailored direct marketing initiatives new online marketing 
initiatives and an extended partner network 
performance
another year of growth in room revenue generated via the 
central reservations system at an all time high of nearly  
400 we see real benefits of our global connections also 
another record year of new members enrolled in the guest 
loyalty programme 
performance
third consecutive year to report an increase in guest 
satisfaction service and product performance and loyalty  
year on year increase in employee satisfaction leading to  
the best result to date 
performance
reduced net debt refinanced several loan agreements further 
strengthened and diversified financial relationships and 
renegotiated operating lease agreements 
6   park plaza hotels annual report 2010 
25 
employee satisfaction since 2008
park plaza hotels’ objective is to become one of the leading hotel ownersoperators  
in the fourstar four star deluxe and lifestyle hotel markets in europe the middle 
east and africa 
t o achieve this objective we use our established recognised portfolio and excellent 
network to increase the number of hotels increase overall profitability through 
innovative revenue generation and costeffective management and utilise the  
carlson partnership as the driver to market our business and products and further 
grow revenues
looking forward
successfully develop our committed projects including new 
art’otels
®
 in amsterdam and london park plaza nuremberg 
and an extension of art’otel berlin city center west we will 
also be looking to capitalise on new opportunities across 
different markets 
looking forward
generate more business through direct online channels 
launch new apps and websites for mobile devices develop 
better customer relationships through social media 
platforms and continue to expand our partner network with 
a view of better serving our current customers and tapping 
into new markets and segments 
looking forward
continue to grow reservations via the highly cost effective 
central reservation system through active participation 
in the loyalty programmes for guests and travel agents 
innovative online initiatives and fostering loyalty  
and engagement 
looking forward
continue to deliver connect training programme develop 
proprietary youniversity educational centre and launch a 
brand new groupwide intranet which will serve as the main 
communications portal to ensure consistency continuity 
and engagement 
looking forward
continue to improve our ebitda margin through further 
improving our financial structure refinancing arrangements 
and costeffective management 
indicator
1579 
1579 new rooms added to our portfolio  
increased ownership to 100 at five hotels 
indicator
107 
107 increase in revpar extended airline partner network 
to 22 launched social media marketing initiatives 
indicator
47500 
47 500 new members signed up for club carlson
sm
 
record system contribution of nearly 400 of room revenue 
indicator
40
guest satisfaction since 2008 
other indicators include service and product performance 
loyalty performance awards and recognition
indicator
269
ebitda margin 
from 202 2009 to 269 2010
park plaza hotels annual report 2010   7 park plaza westminster bridge london
strategic objective
driving revenue growth  
through expanding our asset portfolio 
8   park plaza hotels annual report 2010 strategic objective
driving revenue growth  
through expanding our asset portfolio 
overview 
unlike many of our competitors which 
tend either to manage or own hotels we 
offer hotel management services while also 
having a variety of interests and contractual 
arrangements in our hotels our owner  
branded operator model in combination 
with our longterm exclusive licence in the 
emea region for the park plaza
®
 hotels  
resorts brand and worldwide ownership  
of the art’otel
®
 brand allows us to leverage  
a wide range of opportunities to expand  
our portfolio 
our hotel interests and contractual 
arrangements involve ownership and in 
some cases development and operation 
through operating leases management and 
franchise arrangements
in our view park plaza
®
 hotels  resorts and 
art’otel
®
 both have considerable development 
potential particularly amongst our target 
market of valueminded customers seeking 
affordable luxury
strategy
we intend to grow the number of rooms 
in our portfolio by acquisition either alone 
or in joint ventures with third parties 
management has identified several 
acquisition opportunities and we expect that 
further acquisition opportunities will arise as 
a result of our extensive network of contacts 
if available at attractive prices we intend to 
acquire hotels in our target markets which 
will benefit from rebranding we use our 
experience of development projects gained 
as a result of the company’s participation 
in such projects to exploit development 
opportunities we also look at opportunities 
for operating leases management and 
franchise agreements as and when available
performance
in 2010 three hotels park plaza westminster 
bridge london art’otel cologne and park 
plaza amsterdam airport were added to our 
portfolio adding a further 1579 rooms 
we also acquired park plaza leeds and park 
plaza nottingham which were previously 
operated under longterm operating 
agreements and we acquired the remaining 
interests in park plaza riverbank london 
including plaza on the river park plaza 
victoria london and park plaza sherlock 
holmes london from a joint venture partner 
as a result we now own 100 of these well
established central london hotels
looking ahead we will concentrate 
on the successful development of our 
committed projects which include park 
plaza nuremberg art’otel amsterdam 
art’otel london hoxton and an extension at 
art’otel berlin city center west and we look 
to capitalise on new opportunities across 
different markets 
rooms added to portfolio in 2010
1579
w e believe that park plaza
®
 hotels  resorts and 
art’otel
®
 both have considerable development potential
history of growth
1989199519962000 2001200520062011
1
3
4
8
5
18
6
38
number of countries
number of hotels
park plaza hotels annual report 2010   9
park plaza westminster bridge london
art’otel cologne
park plaza amsterdam airport art’otel cologne
strategic objective
increasing profitability through  
innovative revenue generation  
and costeffective management 
10   park plaza hotels annual report 2010 strategic objective
increasing profitability through  
innovative revenue generation  
and costeffective management 
on a like for like basis we delivered a strong  
revpar growth across all regions and our overall  
results exceeded management’ s expectations 
overview
in its history park plaza hotels has become 
very accustomed to working in difficult 
market conditions we have operated 
and opened new hotels in unprecedented 
times for example we opened two central 
london hotels two weeks after 91 1 and the 
development of our largest hotel to date  
park plaza westminster bridge london  
was carried out in the midst of the recent 
global economic crisis 
operating efficiently agility flexibility and 
creativity are all part of our dna 
strategy
it is our focus to continuously look at 
ways to improve our revenues and in 
particular revpar we expect to further 
grow our average rates whilst maintaining 
or growing occupancy and our teams 
are constantly monitoring trends in the 
market benchmarking against competitors 
and actively using our sophisticated yield 
management systems expansion of – and 
further engagement with – our network of 
partners and affiliates is also a key part of our 
strategy to generate more direct business 
maximising revenue streams other than room 
revenues has become more important for  
us as we have experienced significant  
success with our meeting and event  
facilities and owned branded concepts  
such as chino latino
®
 
we operate with an efficient corporate 
overhead structure which we believe can be 
used to service a larger portfolio we intend 
to retain this structure as our portfolio 
grows thereby retaining the operating 
flexibility required to take advantage of the 
opportunities which may arise both for 
expansion and to maximise returns from the 
company’s existing portfolio
performance
on a like for like basis we delivered a  
strong revpar growth across all regions  
and our overall results exceeded 
management’s expectations 
the year was marked with several other 
commercial successes as well as laying 
the foundation for an even more focused 
approach moving forward 
we added two new strategic partners in 
the year gulf air and el al taking our 
total airline partner network to 22 these 
relationships enable us to tap into new 
markets by putting our brands in front  
of new prospective audiences and target  
them with highly targeted offers 
we also started actively engaging with a 
number of key social media platforms  
largely driven by our new and extended online 
marketing team and laid the foundation for  
a mobile web platform which will be 
launched in 201 1 
2010 revpar
€857
y ear on year revpar increase
107
highlights
like for like  
revpar increased  
in all markets in  
which we operate
 w e ex t en d e d  
our airline partner  
network to 22 
launch of social  
media strategy  
focusing on t witter  
and facebook
park plaza hotels annual report 2010   11
park plaza county hall london
park plaza sherlock holmes london carlson’s park plaza sukhumvit bangkok
strategic objective
utilising the carlson partnership  
to market the group’s business and  
further grow revenues 
12   park plaza hotels annual report 2010 strategic objective
utilising the carlson partnership  
to market the group’s business and  
further grow revenues 
our wide range of direct marketing and sales initiatives 
has resulted in greater brand recognition which is 
reflected in increased system room revenues 
overview
our unique and exclusive partnership with 
carlson for the park plaza
®
 hotels  resorts 
brand provides us with access to their 
stateoftheart reservation and distribution 
systems and participation in a wide array of 
sales and marketing programmes 
carlson’s central reservation system 
provides a central repository of reservations 
room availability and rates and this database 
is not only linked to proprietary channels 
such as the brand websites and call centres 
but also to third party distribution systems 
including the main global distribution 
systems which are largely used by business 
travel agents and leading travel websites 
carlson also provides call centre operations 
across three different time zones us ireland 
and china and its more than 415 staff 
provide guests with reservation and customer 
service support 365 days per year
loyalty programmes include club carlson
sm
 
formerly goldpoints plus™ for guests and 
meeting planners and look to book
®
  
the travel industry’s premier travel agent 
reward programme 
in a global market where major corporations 
are consolidating their supplier relationships 
being part of a global network ensures that 
our hotels remain at the forefront of corporate 
travel buyers and it improves our positioning 
and visibility with global travel consortia 
the carlson network has a crossselling 
strategy at all customer touch points for 
the different brands within the carlson 
family this includes reservation call centres 
global distribution system points of sale 
the brand websites managed by carlson and 
carlson’s own global sales force the carlson 
marketing and reservation services cover the 
park plaza
®
 hotels  resorts and art’otel
®
 
brands which are both marketed through 
their reservation system
in summary park plaza hotels truly benefits 
from the economies of scale extensive 
operating experience and significant 
negotiating power of one of the world’s 
largest travel and hospitality companies 
strategy 
to ensure optimum results and visibility 
for our hotels and brands we fully embrace 
all sales marketing and distribution 
opportunities and channels available to us 
through carlson we employ specialists in 
all fields ensuring we continue to generate 
maximum value out of this relationship 
from technology to partnerships from 
loyalty marketing to direct sales and from 
ecommerce to distribution we have fully 
aligned and activated our organisation 
performance 
in 2010 we continued to enjoy the  
benefits of the carlson relationship and  
took full advantage of all available  
distribution channels technology solutions  
crossmarketing opportunities and marketing 
programmes despite the difficult trading 
environment we continued to experience 
growth in contribution to hotel room revenues 
generated through carlson’s reservation 
system approximately 400 of our room 
revenue was generated via this platform at the 
end of 2010 which is a record 
the main drivers for this continued growth 
have been the active participation in online 
distribution and marketing initiatives and a 
heavy focus on customer loyalty marketing 
the club carlson
sm 
database increased by 
24 year on year to 63 million members 
and carlson is anticipating to grow this 
database to 10 million by 2013 park plaza 
hotels contributed more than its fair share 
by signing up a record 47 500 new members 
in the year representing more than a 50 
increase on 2009 at the same time the share 
of occupancy from loyalty members staying 
at our hotels was higher than ever before and 
we expect this trend to continue 
club carlson’s
sm
 2010 membership 
base increased by 24 from 2009
63m
new club carlson
sm
 members 
signed up by park plaza hotels
47500
2010 2009 2008 2007 2006 2005
238
161
289
224
348
270
378
306
380
308
396
299
revenue
occupancy 
system contribution to hotel occupancy and revenue
park plaza hotels annual report 2010   13
carlson’s 
park plaza beijing wangfujing 
park plaza sukhumvit bangkok strategic objective
improving operational performance  
through better service quality 
14   park plaza hotels annual report 2010
park plaza riverbank london strategic objective
improving operational performance  
through better service quality 
for the third consecutive year we are proud to report 
an increase in guest satisfaction service  product 
performance and loyalty  
overview
although travel preferences booking 
behaviour and new technologies have 
changed our industry significantly over the 
years the fundamentals of true hospitality 
haven’t changed in fact in today’s highly 
competitive and fully transparent market with 
rising consumer power a genuine consistent 
and personalised customer service delivery is 
vital to any company’s survival 
strategy 
to ensure that we consistently deliver and 
where possible even exceed an excellent 
customer experience we actively solicit 
customer feedback continuously invest in 
employee training and we empower and listen 
to our employees 
performance 
for the third consecutive year we are proud 
to report an increase in guest satisfaction 
service  product performance and loyalty 
since the introduction of our online guest 
satisfaction survey system in august 2008 
we have collected nearly 78000 completed 
surveys with a record of 39000 completed 
surveys collected in 2010 
all new hotels and several of the franchised 
hotels were added to the guest satisfaction 
survey system in the year giving us insight into 
their operations and enabling us to further 
improve their performance
our experienced staff is responsible for the 
increased guest satisfaction levels and their 
constant focus on delivering a high quality 
service has truly paid off
we do not take this success for granted 
and have therefore continued to invest in 
the connect training programme in the 
year originally launched in 2008 connect 
focuses on how each individual member of 
staff can exceed guest expectations with 
an increased workforce of 29 primarily 
as a result of the new openings it was 
vital to successfully deliver new uniformed 
introduction welcome packs and connect 
service training programmes 
the company was successful in delivering 
these essential tools on time and is proud to 
report that overall employee satisfaction has 
increased year on year by 21 to a healthy 
810 areas such as ethical standards 
honesty transparency and personal 
development were rated the highest 
201 1 started well for park plaza hotels as 
we were awarded the 201 1 business travel 
award in the ‘best small or independent 
hotel brand’ category yet another testimony 
to our success
completed online guest satisfaction  
surveys 2010
39000
employee satisfaction 2010
810
improved guest satisfaction on a scale of 110 2008 2009 2010
overall guest satisfaction 795 812 827
service performance 808 829 839
product performance 792 804 823
loyalty performance 779 803 814
guest satisfaction system was introduced in august and 2008 data is from augustdecember 
increased employee satisfaction 2008 2009 2010
employee satisfaction score 785 789 810
park plaza hotels annual report 2010   15
park plaza riverbank london strategic objective
improving our financial performance  
and structure
16   park plaza hotels annual report 2010
park plaza victoria amsterdam  strategic objective
improving our financial performance  
and structure
during 2010 we have succeeded in further strengthening 
our financial structure and were pleased to have reduced 
net debt year on year
overview
during the tough market conditions 
experienced by the hotel industry in recent 
years we have continued to invest in our 
existing hotels and expand our portfolio 
with three new hotel openings in the year 
resulting in the addition of 1579 rooms to 
our portfolio the benefits of our investment 
in our development pipeline alongside  
an improvement in trading conditions  
are starting to be reflected in our  
financial performance 
strategy 
our strategy is to have a solid financial 
structure in place which enables us to 
capitalise on new hotel opportunities in order 
to extend our presence in the affordable 
luxury hotel market such opportunities 
would be financed through our own excellent 
network of financial partners or through 
joint ventures this structure will also allow 
for continued investment in our current hotel 
portfolio to maintain the high standard of 
our existing hotels naturally we will also 
remain focused on managing operational 
costs tightly whilst providing our customers 
with a high quality of product and service
performance 
during 2010 we have succeeded in further 
strengthening our financial structure  
and were pleased to have reduced net  
debt year on year 
despite the challenging debt markets we 
successfully negotiated the refinancing of 
three of our london hotels – park plaza 
riverbank london including plaza on the 
river park plaza victoria london and 
park plaza sherlock holmes london – with 
aareal bank ag which resulted in a €1 15 
million reduction in net debt and a new 
fiveyear facility we subsequently acquired 
100 ownership of these hotels which had 
previously been part owned through a joint 
venture agreement 
the net proceeds from the sale of units at 
park plaza westminster bridge london were 
used to reduce our development facility with 
bank hapoalim 
we maintain good relationships with our 
lending banks and through our relationship 
with aareal bank ag we were able to increase 
our existing facility in the netherlands in 
order to finance the acquisition of park plaza 
amsterdam airport 
we also managed to finance the acquisition 
of headlease interests and acquired the 
company which owned the freehold and long 
leasehold interests in park plaza leeds and 
park plaza nottingham 
as owners of hotels we fully understand what 
it means to own real estate and have high 
regards for owner relationships based on 
trust respect and profitability our strong 
relationships with owners have enabled us to 
successfully renegotiate lease agreements at 
some of our hotels which did not reflect the 
changing market landscape these revised 
agreements will benefit the future financial 
performance of these hotels and their 
contribution to our business
in june 201 1 we successfully refinanced the 
development facility with bank hapoalim 
into a new seven year facility in relation to 
park plaza westminster bridge
ebitda margin  
269
from 202 2009 to 269 2010
park plaza hotels annual report 2010   17
park plaza vondelpark amsterdam  chief financial officer’s statement
a strong financial performance 
aided by a recovery in market  
conditions and new openings  
and acquisitions
welcome
i am pleased to report our 2010 full 
year results which exceeded the board’s 
expectations total revenue for the year 
increased by 741 to €1398 million 2009 
€803 million as we benefited from first time 
contributions from park plaza westminster 
bridge london art’otel cologne and park 
plaza amsterdam airport which were added 
to the portfolio during the year and from 
total revenue contributions from park plaza 
leeds and park plaza nottingham as of 
august 2010 
when contributions from these hotels and 
the effect of foreign currency movements 
are excluded group revenue increased by 
31 reflecting an improvement in underlying 
performance as the early signs of a market 
recovery reported at the half year results 
continued into the second half of the year
revpar
reported revpar increased by 107 to 
€857 2009 €77 4 primarily reflecting a 
132 improvement in average room rates 
during the year albeit on an anticipated 
decline in year on year occupancy due to the 
addition of five hotels to the portfolio this 
is in part due to park plaza westminster 
bridge london and art’otel cologne being in 
the early stages of their operational lifecycle 
as well as lower occupancy and average 
room rates at park plaza leeds and park 
plaza nottingham with the uk provincial 
destinations slower to recover and park plaza 
amsterdam airport which commands lower 
rates than our other dutch hotels located in 
city centres like for like revpar improved by 
86 to €863 2009 €794
ebitda
ebitda increased to €37 6 million 2009 
€162 million primarily due to the first 
time contribution from the addition of 
new hotels into the portfolio particularly 
park plaza westminster bridge london a 
significant improvement in the german and 
hungarian operations which resulted in a 
reduced ebitda loss of €300000 compared 
with a loss of €37 million in 2009 and an 
improvement in management and holdings 
ebitda to €58 million 2009 €21 million 
on a like for like basis ebitda increased by 
166 to €197 million 2009 €169 million
profit
the reported profit before tax was €605 
million 2009 loss of €7 2 million the 
profit relates mainly to gains arising from 
the application of ifrs accounting following 
park plaza hotels obtaining 100 control of 
previously jointly owned entities refer to note 
3c to the consolidated financial statements 
amounting to €508 million and negative 
goodwill arising from the newly acquired 
interests in hotels amounting to €100 million 
see note 3a 3b and 3c to the consolidated 
financial statements in addition the 
ebitda contribution from the opening and 
acquisition of the new hotels increased by 
€17 9 million and the interest and income 
from forfeited deposits relating to the sale 
of units in park plaza westminster bridge 
london amounted to €57 million we faced 
a oneoff expense due to the refinancing of 
the goldman sachs international loan of  
€89 million the breakage of the finance 
hedge and additional depreciation expenses 
due to the new hotels of €42 million an 
additional €7 7 million of finance expenses 
and interest expenses guaranteed to unit 
holders of park plaza westminster bridge 
london was also incurred 
earnings per share
basic and diluted earnings per share for the 
year was €15 2009 loss of €020 details 
on the calculation of earningsloss per share 
are provided in note 27 to the consolidated 
financial statements
debt position and refinancing 
net debt at 31 december 2010 was €3699 
million a net year on year reduction of 
€340 million at 31 december 2009 €4039 
million this includes €309 million of liquid 
assets 2009 €458 million of which cash 
and cash equivalents were €256 million 
2009 €344 million and other liquid 
financial assets of €53 million 2009  
€1 14 million 
during the period the movement in net 
debt included a €489 million year on year 
reduction in loans which is mainly due 
to €1690 million repayment by marlbray 
limited following the sale of units at park 
plaza westminster bridge london and 
a €1 15 million reduction following the 
refinancing of the three london hotels there 
was also a €881 million increase as a result 
of the purchase of the remaining interest in 
and shareholder loans related to the three 
18   park plaza hotels annual report 2010 chief financial officer’s statement
a strong financial performance 
aided by a recovery in market  
conditions and new openings  
and acquisitions
london hotels a €219 million increase 
relating to the purchase of park plaza leeds 
and park plaza nottingham a €138 million 
increase relating to the purchase of park 
plaza amsterdam airport and a €103 
million adverse foreign exchange translation 
movement during the period cash reduced 
by €149 million of which €60 million relates 
to the purchase of park plaza leeds and park 
plaza nottingham and €89 million relates to 
the refinancing of the three london hotels 
further details are set out in note 3 to the 
consolidated financial statements
financial structure – main developments 
during the period
 sale of units at park plaza westminster 
bridge london
535 of the 865 units sold or contracted to 
be sold as at 31 december 2010 have been 
completed all remaining sales contracts have 
been rescinded and we have retained 330 
units in addition to the 154 units already held 
by us the £1542 million €1790 million net 
proceeds raised from the completed sales 
and a further £21 million €24 million from 
forfeited deposits have primarily been used 
to repay the bank hapoalim development 
facility of which £934 million €1084 
million was outstanding at 31 december 
2010 the £156 million €182 million of 
deposits received in respect of uncompleted 
sales are held on the balance sheet as 
restricted deposits and are not included in 
our €309 million liquid assets for further 
details about this financial structure  
see note 17b to the consolidated financial 
statements
 financing of park plaza amsterdam airport
we increased our existing facility with aareal 
bank ag in april 2010 in order to finance the 
acquisition of park plaza amsterdam airport 
the amended facility the maturity  
of which was extended to april 2017  has  
a value of €1 1 10 million and includes  
€50 million for renovations and updates  
to park plaza victoria amsterdam and  
park plaza amsterdam airport further 
details are set out in note 17a 2 to the 
consolidated financial statements
financing of park plaza leeds and park 
plaza nottingham
in august 2010 we acquired the headlease 
interests and the companies which owned  
the freehold and long leasehold interests 
in the park plaza leeds and park plaza 
nottingham from a whollyowned member 
of the red sea group for an aggregate cash 
consideration of £33 million €40 million 
further details are set out in note 3b to the 
consolidated financial statements
 refinancing of three london hotels
in november 2010 we announced the 
refinancing of three london hotels – park 
plaza riverbank london including plaza on 
the river park plaza victoria london and 
park plaza sherlock holmes london the 
refinancing involved five year term facilities 
totalling £1650 million €1915 million with 
aareal bank ag further details are set out 
in note 17a 1 to the consolidated financial 
statements 
acquisition of interests in three  
london hotels 
in december 2010 we acquired the remaining 
joint venture interests in and loans related to 
park plaza riverbank london including plaza 
on the river park plaza victoria london and 
park plaza sherlock holmes london for a 
consideration of £210 million €244 million 
subject to adjustments including the issue of 
1000000 park plaza shares further details 
are set out in note 3c to the consolidated 
financial statements 
cost controls 
we have managed to keep a tight control 
on costs whilst ensuring that our guests 
continue to enjoy the high quality of product 
and services they expect in line with the 
board’s expectations costs in the first half of 
the year increased as a result of the oneoff 
preopening costs including payroll and 
marketing costs primarily relating to the 
opening of the park plaza westminster  
bridge london and art’otel cologne 
germany we will continue to monitor  
and manage costs closely 
looking ahead
as outlined above in 2010 we succeeded in 
developing a stronger financial structure in 
addition we successfully renegotiated several 
of our operating leases which already had 
a positive impact in the year and we will 
continue to see these benefits in 201 1 
in june 201 1 we announced the refinancing 
of park plaza westminster bridge london 
which involved seven year term facilities 
totalling £1 150 million €1335 million  
with bank hapoalim bm 
with our expanded and stronger hotel 
portfolio and increased travel demand we 
expect to further improve average room rates 
and profitability we will also continue to be 
making timely capital investments to ensure 
our longterm prospects 
chen moravsky 
chief financial officer
revenue
€1398m
€803m
profit before tax
€605m
€72m
earnings per share
€15
€02
park plaza hotels annual report 2010   19 review of 2010 
united kingdom
reported total revenue increased from  
€290 million to €816 million mainly  
due to new openings and acquisitions
20   park plaza hotels annual report 2010
park plaza westminster bridge london  park plaza hotels annual report 2010   21
review of 2010 
united kingdom
reported total revenue increased from  
€290 million to €816 million mainly  
due to new openings and acquisitions
the group’ s three established owned london hotels 
all delivered strong performances for the year and 
outperformed their competitive set
our performance
in the united kingdom revpar was €1 128 2009 €1096 an 
increase of 30 year on year benefiting from foreign exchange 
translation however in local currency revpar marginally declined as 
a result of the opening of park plaza westminster bridge london and 
the acquisition of park plaza leeds and park plaza nottingham in the 
year on a like for like basis and in local currency revpar increased by 
7 2 to £1043 2009 £97 3 
revpar in the london hotel market improved in the year particularly 
in the second half as demand from both corporate and leisure guests 
increased which is reflected in occupancy and year on year average 
room rate tri hospitality december 2010
the group’s three established owned london hotels – park plaza 
victoria london park plaza riverbank london including plaza on the 
river and park plaza sherlock holmes london – all delivered strong 
performances for the year and outperformed their competitive set in 
terms of revpar on the back of occupancy ahead of their competitive 
sets str global december 2010 in particular park plaza victoria 
london performed strongly in the year outperforming its competitive 
set in terms of occupancy and average room rate and delivered 
revpar 194 higher than the average for its competitive set in 2010 
str global december 2010 
in the united kingdom reported total revenue increased to €816 
million 2009 €290 million and ebitda increased to €245 million 
2009 €1 14 million mainly due to the opening of park plaza 
westminster bridge london and the acquisitions of park plaza  
leeds and park plaza nottingham
on a constant currency and like for like basis total revenue increased 
by 38 to €301 million 2009 €290 million ebitda reduced to 
€102 million 2009 €1 14 million 
developments
park plaza westminster bridge london the group’s prestigious 
flagship hotel partially opened to paying guests in march 2010 and 
fully opened in september 2010 the hotel which has magnificent 
views of big ben and the houses of parliament offers 1019 rooms 
including penthouse suites mandara spa stateoftheart meeting 
and conference facilities including a 1200 square metre pillar free 
ballroom and 31 meeting rooms making it one of the most versatile 
hotels in central london the hotel features a 200seat signature 
restaurant brasserie joël headed by acclaimed chef joël antunes  
as well as a 30seat japanese restaurant the hotel’s performance  
has been very encouraging since opening and customer satisfaction 
has been consistently high 
as at 31 december 2010 the sale of 535 units at park plaza 
westminster bridge london had been completed raising net  
cash proceeds for the group of £1542 million €1790 million 
in august 2010 the group acquired park plaza leeds and park plaza 
nottingham which the group had previously operated under longterm 
management agreements park plaza leeds is located in the centre of 
leeds opposite leeds railway station and the main city square and is 
within walking distance of local businesses shopping centres and tourist 
attractions and offers 185 rooms and suites flexible meeting space for 
up to 140 delegates a business centre and fully equipped gym park 
plaza nottingham located in the city centre offers 178 spacious rooms 
and suites and 12 flexible meeting rooms with space for 220 delegates 
and a fitness suite both hotels offer park plaza’s award winning chino 
latino
®
 restaurant and bar 
as provincial hotels these hotels change the hotel mix as they 
attract lower average room rates than the group’s london hotels 
nonetheless in 2010 both hotels outperformed their competitive sets 
in terms of revpar str global december 2010 
the group is investing in the complete refurbishment of the rooms 
and public areas at park plaza leeds and park plaza nottingham 
works commenced in the first quarter of 201 1 and are scheduled  
to be completed in the fourth quarter of 201 1 
in february 2010 the group was granted planning consent for 
london’s first art’otel
®
 located in hoxton following two years of 
design work and consultation with the local authorities and local 
community in shoreditch construction work for the 352 room 
art’otel london hoxton is due to commence in 201 1 the hotel is 
scheduled to open in 2013 
hotel operations euro € gbp £
year ended 
31 december 2010
year ended 
31 december 2009
year ended 
31 december 2010
year ended 
31 december 2009
occupancy 818 848 818 848
average room rate €1379 €1292 £1180 £1147
revpar €1128 €1096 £965 £973
total revenue €816 million €290 million £699 million £258 million
ebitda €245 million €1 14 million £210 million £100 million
park plaza leeds the netherlands
the dutch hotel market saw a gradual  
recovery in demand and the group’s dutch  
hotels delivered a good performance
22   park plaza hotels annual report 2010
park plaza eindhoven park plaza hotels annual report 2010   23
the netherlands
the dutch hotel market saw a gradual  
recovery in demand and the group’s dutch  
hotels delivered a good performance
park plaza victoria amsterdam and park plaza v ondelpark 
amsterdam both outperformed their competitive sets
our performance
having been adversely affected by the recent downturn in the 
economy particularly in amsterdam the dutch hotel market saw a 
gradual recovery in demand from corporate and leisure guests in the 
first half of the year which gained momentum in the second half 
against this backdrop the group’s dutch hotels delivered a good 
performance total revpar for the netherlands was €796 2009 
€914 as it was impacted by a decline in occupancy and average room 
rate as a result of the addition of park plaza amsterdam airport to the 
group’s dutch hotel portfolio however like for like revpar increased 
by 47 to €957 2009 €914 driven by a 57 improvement in 
average room rate 
park plaza victoria amsterdam and park plaza vondelpark 
amsterdam both outperformed their competitive set in terms of 
revpar achieved through high occupancy at these hotels of 910 
and 77 0 respectively compared with occupancy of 795 and 695 
respectively for the competitive set str global december 2010 
renovations of the public areas meeting areas and the creation of 
a wine bar called vbar at park plaza vondelpark amsterdam were 
completed in april 2010
park plaza utrecht and park plaza eindhoven both delivered a strong 
performance during the year outperforming their competitive sets in 
terms of occupancy and revpar with park plaza utrecht reporting 
revpar 31 ahead of its competitive set str global december 2010
reported total revenue increased by 155 to €228 million  
2009 €198 million and ebitda grew by 17 9  to €7 6 million 
2009 €65 million on a like for like basis ebitda increased by 
129 to €7 3 million 2009 €65 million
developments
in april 2010 the group acquired with a joint venture partner a large 
conference hotel located near amsterdam schiphol airport this 342 
room hotel which has over 1800 square metres of flexible meeting 
space was rebranded park plaza amsterdam airport the hotel’s 
location outside of amsterdam city centre means that it achieves a 
lower average room rate than the group’s other dutch hotels as a 
result the group’s future revpar for the dutch market will reflect 
this change to the hotel mix in order to strengthen the hotel’s market 
position particularly in the corporate market renovations and 
updates commenced in the first quarter of 201 1 
in october 2010 construction commenced on art’otel amsterdam 
the city’s first art’otel
®
 to be located in the iconic former “kadaster” 
office in a prime location near central station in line with the 
art’otel
®
 brand this 105 room hotel will include dedicated public 
spaces on the ground and basement floors to showcase social  
and cultural activities as well as an art café the hotel is expected  
to open in 2012
major renovations are underway across the group’s dutch hotel 
portfolio this includes the refurbishment of 164 rooms in the 
garden wing and meeting rooms at park plaza victoria amsterdam 
renovation of 47 rooms at park plaza eindhoven which both 
commenced in the first quarter of 201 1 and the refurbishment  
of 40 rooms at park plaza utrecht 
hotel operations
year ended 
31 december 2010
year ended 
31 december 2009
occupancy 779 841
average room rate €1022 €1087
revpar €796 €914
total revenue €228 million €198 million
ebitda €7 6 million €65 million
park plaza eindhoven germany and hungary
the ebitda loss in germany and 
hungary was reduced by 90 
and revpar increased by 127
24   park plaza hotels annual report 2010
art’otel cologne germany and hungary
the ebitda loss in germany and 
hungary was reduced by 90 
and revpar increased by 127
despite the challenges in germany  the group’ s hotels 
have performed in line with the market
our performance
in germany and hungary which have historically been the most 
challenging markets in which the group operates revpar increased 
by 127 to €484 2009 €430 reflecting a 143 increase in average 
room rate year on year this improvement was in part helped by the 
german government reducing the value added tax rate from 19 to 
7 on 1 january 2010 occupancy at the group’s hotels was adversely 
impacted by the newly opened art’otel cologne like for like revpar 
increased by 7 9 to €483 2009 €448
the german and hungarian hotel markets have continued to be 
characterised by an oversupply of hotel rooms particularly in major 
cities such as berlin dresden and budapest although the german 
hotel market has seen an 8 improvement in revpar during the 
year mkg hospitality january 201 1 this was primarily driven by 
increased average room rates following the government reduction in 
value added tax 
despite the challenges in germany the group’s hotels have performed 
in line with the market and the group has benefited from this 
improvement in average room rate which resulted in a year on year 
increase in revpar art’otel berlin city center west art’otel berlin 
kudamm art’otel dresden and park plaza prenzlauer berg berlin all 
outperformed their competitive sets in terms of average occupancy  
in the year fairmas december 2010 
on a like for like basis total revenue increased by 64 year on year 
and the ebitda loss was reduced by 900 to a €03 million loss  
2009 loss of €30 million
budapest continues to be one of the most difficult markets in europe 
with continued downward pressure on average room rates during the 
year the lease for art’otel
 
budapest was favourably renegotiated which 
will benefit the future financial performance of this hotel 
given the oversupply of hotel rooms in these markets the group 
continues to review its operations and strategies in germany in order 
to improve its performance a number of hotels remain under review 
and the group will continue to take action where appropriate 
developments
art’otel cologne the group’s newlybuilt 218 room hotel located in 
the newly developed prestigious rheinauhafen area of cologne was 
opened in march 2010 the hotel features artwork by the korean
born seo and has the first park plaza award winning chino latino
®
 
restaurant and bar outside the united kingdom customer feedback 
on the facilities and customer service since opening has been positive 
in its first year it was already recognised as one of the ‘100 best hotels 
in the world’ by the sunday times travel magazine and its chino 
latino
®
 bar and restaurant has received various accreditations
in the second quarter of 2010 work commenced to extend the 
art’otel berlin city center west this 60 room extension will include 
refurbishment of the ground floor the addition of two new meeting 
rooms and a new wellness centre the project is scheduled to finish in 
the fourth quarter of 201 1
a renovation programme to refurbish all rooms and public areas at 
art’otel budapest will commence in 201 1 the project is due to be 
completed in 2012 
progress at park plaza nuremberg continues and the hotel is expected 
to open in 2013
hotel operations
year ended 
31 december 2010
year ended 
31 december 2009
occupancy 704 714
average room rate €688 €602
revpar €484 €430
total revenue €27 7 million €235 million
ebitda €03 million €37 million
park plaza hotels annual report 2010   25
art’otel cologne management and holdings operations 
ebitda increased significantly by 1762  
due to newly opened and acquired hotels
26   park plaza hotels annual report 2010
park plaza cardiff park plaza hotels annual report 2010   27
management and holdings operations 
ebitda increased significantly by 1762  
due to newly opened and acquired hotels
revenue from the management and holdings 
operations reduced slightly to €77 million
our performance
revenue from the management and holdings operations reduced 
slightly to €7 7 million 2009 €81 million 
this is partially as a result of the elimination of revenue from park 
plaza leeds and park plaza nottingham following their acquisition  
by the group and their consolidation into the group’s accounts 
the opening of park plaza westminster bridge london and art’otel 
cologne and the acquisition of park plaza amsterdam airport by 
reference to the group’s interests and park plaza leeds and park 
plaza nottingham post august in the year had no impact on the 
management revenue as this revenue is eliminated upon consolidation 
ebitda increased by 1762 to €58 million 2009 €21 million  
with the newly opened and acquired hotels in 2010 contributing  
€33 million to the ebitda of the management and holdings 
operations the further increase in ebitda can be attributed  
to nonrecurring restructuring costs included in 2009 
management and holdings operations
year ended 
31 december 2010
year ended 
31 december 2009
total revenue €7 7 million €8 1 million
ebitda €58 million €21 million
park plaza cardiff park plaza cardiff croatia 
in 2010 we continued with several  
refurbishment projects across the portfolio  
in particular at hotel histria
28   park plaza hotels annual report 2010
ambrela lounge and beach bar park plaza hotels annual report 2010   29
croatia 
in 2010 we continued with several  
refurbishment projects across the portfolio  
in particular at hotel histria
hotels
hotel histria  
hotel medulin  
hotel brioni  
hotel park  
hotel palma  
hotel holiday  
hotel belvedere  
guest house riviera 
resorts
verudela beach and villas 
resort 
punta verudela resort 
horizont resort 
splendid resort  
ai pini medulin resort 
w e also further developed the renovation plans which are 
to be implemented following the 2011 season 
our relationship 
arenaturist is one of croatia’s best known hospitality groups and 
consists of eight hotels five holiday apartment complexes eight 
campsites and 52 food and beverage outlets all of which are located 
in istria arenaturist caters primarily for european tourists and  
the majority of accommodations are only operational during  
the summer months
all properties are located in prime locations by the sea and are  
only a short distance from either the 3000 year old city of pula  
or the touristic medulin
in 2008 park plaza hotels acquired a 20 stake in bora  
the holding company of the arenaturist group and was  
awarded the management agreement for arenaturist
arenaturist is listed on the zagreb stock exchange
our progress 
since we started operating arenaturist we have mainly focused on 
improving the operational results we appointed a new board and 
senior management and initiated several staff training programmes 
focused on improving overall guest experiences we also launched 
several new websites invested in those facilities that would provide 
an immediate return whilst continuing to develop our longer term 
renovation plans several planning applications have since been 
submitted and granted 
in 2010 we continued with several refurbishment projects across 
the arenaturist portfolio in particular extensive room renovations 
commenced at hotel histria and these are due to be completed for 
the start of the 2012 season 
at several hotels the restaurants bars and pool areas were also 
renovated we also further developed the renovation plans which 
are to be implemented following the 201 1 season the arenaturist 
portfolio will upgrade its back office property management 
technology platform in the first half of 201 1 for which most 
preparations were done in 2010
campsites
stoja camp  mobile homes 
medulin camp  mobile homes 
kažela camp  
stupice camp  mobile homes 
indije camp  mobile homes 
runke camp 
pomer camp 
tašalera camp
wwwarenaturistcom 
wwwarenacampscom
ambrela lounge and beach bar aerial view of punta verudela ultimately our work in this area will lead 
to a more efficient operation strengthen 
our position in local communities 
minimise our impact on the environment 
and improve our bottom line
30   park plaza hotels annual report 2010 the travel industry has a significant impact 
on the environment and the communities 
in which it operates and park plaza hotels 
remains fully committed to working towards 
minimising this impact wherever possible 
operating responsibly is now part of 
our everyday life and although we have 
introduced many new initiatives and new 
methods of working in recent years we 
still see a significant opportunity to further 
improve efficiency minimise our impact on 
the environment and actively support local 
communities alongside managing our costs 
and delivering better results for shareholders 
since we introduced our first companywide 
corporate social responsibility csr policy  
in 2008 we have made a significant progress in 
this area and we are particularly proud of how 
our teams have embraced this framework 
adapted it to local needs and requirements 
and implemented it with great enthusiasm 
our csr policy is a clear and solid framework 
of mandatory requirements and optional 
initiatives for each hotel under our 
management each general manager is 
responsible for implementing the policy on a 
local level with the support of his or her team 
and under the guidance of regional and 
head office management this approach  
has led and will continue to lead to greater 
efficiencies and sharing of best practice 
the framework is built around two core areas 
tree total responsibility for everyone’s 
environment and season save energy 
and switch off now and together these 
outline the objectives and initiatives for our 
group in the following areas 
•	 water 
•	 electricity 
•	 heating 
•	 purchasing 
•	 waste management 
•	 learning and development 
•	 community 
•	 charity 
•	 corporate travel 
•	 guest communication
our new flagship hotel park plaza 
westminster bridge london is a real 
testimony to our commitment to building and 
operating sustainable hotels for example  
the hotel’s onsite water bottling plant used 
to bottle water for meetings and events and 
room service significantly reduces its carbon 
emissions as it eliminates the need to transport 
an estimated one million bottles of water to 
and from the hotel each year 
with extensive renovations carried out in 
many of our hotels in recent years and 
several more planned for 201 1 we are making 
progress in improving overall efficiency and 
saving resources this has been done through 
the implementation of smarter systems 
and technologies such as passive infrared 
sensors in guest rooms meeting rooms and 
certain public areas devices which control 
the water flow of showers taps and toilets 
building management systems which control 
temperature settings throughout the day and 
installation of energy saving bulbs and led 
our activities focus not only on technical 
improvements but also encourage our 
hotels to engage with their employees and 
suppliers for them to make a difference too 
real life examples include minimising the 
number of delivery days for suppliers buying 
local produce encouraging car sharing by 
employees and enforcing internal policies  
for recycling and switching off appliances  
and lights 
we actively encourage our hotels to support 
the local communities in which they 
operate throughout the year our teams 
enthusiastically organised and participated in 
events such as fundraising initiatives charity 
balls volunteer days litter removal initiatives 
and tree planting days 
most of our hotels now participate in 
earth hour and charities supported in 
2010 included deutsches kinderhilfswerk 
springboard macmillan cancer support 
red nose day cycle ride csodalámpa for 
seriously ill children and local schools 
and homeless shelters the company also 
continued to support the willow foundation 
and carbon neutral through our partnership 
with carlson 
our collective csr work has been recognised 
and more and more of our hotels now 
have official accreditation from national or 
international organisations to name but a 
few both park plaza county hall london 
and park plaza westminster bridge london 
were awarded a gold award by the green 
tourism business scheme for park plaza 
westminster bridge london this was a 
particularly impressive feat considering that 
this hotel has only recently opened park 
plaza nottingham achieved silver status and 
park plaza victoria london was awarded 
bronze in the netherlands both park 
plaza victoria amsterdam and park plaza 
eindhoven received a silver award from the 
green key organisation 
in 201 1 we will continue to embrace 
implement and trial new technologies and 
installations and will work towards obtaining 
accreditation for more of our hotels and 
increase where possible the tiers for those 
already certified we will achieve this by 
working closely with all stakeholders such as 
hotel owners employees and suppliers but 
we will also raise the bar for new property 
developments 
we will also develop a stronger internal 
communication platform for csr related 
matters on the soon to be launched 
companywide intranet fostering an 
environment for employees to share ideas 
and best practice 
ultimately our work in this area will lead to 
a more efficient operation strengthen our 
position in local communities and minimise 
our impact on the environment 
corporate social responsibility
the willow foundation
park plaza hotels proudly supports 
the phenomenal work of the willow 
foundation a charity that aims to bring joy 
and happiness to thousands of terminally ill 
patients through organised experiences
the willow foundation was founded in 
1999 by former arsenal and scotland 
goalkeeper and tv presenter bob wilson 
and his wife megs in memory of their 
daughter anna who died of cancer shortly 
before her 32nd birthday boris ivesha the 
company’s ceo is a member of willow’s 
development committee
carbon neutral through club carlson
sm
 
the carbon neutral company is one 
of the world’s leading climate change 
businesses set up in the late 1990s they 
are helping thousands of people and 
hundreds of major companies around 
the world to measure reduce and offset 
their co
2 emissions club carlson
sm
 
members can redeem their gold points 
to contribute towards community based 
carbon reduction projects that balance 
out co
2

park plaza hotels annual report 2010   31 directors’ report
the directors present their report and the 
audited financial statements of the group  
for the year ended 31 december 2010 
principal activities
the company is a guernsey registered 
company and through its subsidiaries 
jointlycontrolled entities and associates 
owns and in some cases develops leases 
operates and franchises full service fourstar 
fourstar deluxe and lifestyle hotels in major 
gateway cities and regional centres primarily 
in europe 
the majority of the group’s hotels  
operate under one of two distinct brands 
park plaza
®
 hotels  resorts or art’otel
®

the group holds a longterm exclusive licence 
in the emea region for the park plaza
®
 hotels 
 resorts brand and worldwide ownership  
of the art’otel
®
 brand allowing it to leverage  
a wide range of opportunities to expand its  
brands and portfolio
business review 
a review of the business during the year is 
contained in the chairman’s statement 
chief executive officer’s statement strategy 
and performance overview chief financial 
officer’s statement and review of 2010
results and dividend 
the results for the year are set out in the 
attached financial statements
basic and diluted earnings per share for  
the year was €15 2009 loss of €020  
the board believes that it is prudent not  
to recommend the payment of a dividend  
this year 
as a matter of guernsey law any distribution 
of dividends will need to be in accordance 
with the provisions of the companies law 
the directors will therefore need to carry out 
a liquidity or cash flow test and a balance 
sheet solvency test before any dividend or 
distribution payment can be made the 
test requires the directors to make a future 
assessment by making reference to the 
solvency test being satisfied immediately 
after a distribution or dividend payment is 
made if at the time a dividend or distribution 
payment is to be made the directors  
believe that the solvency test cannot be 
passed then no payment may be made to  
the holders of shares 
subject to compliance with guernsey law 
and the retention of proper and prudent 
reserves by the company the board intends 
to recommend the payment of an annual 
dividend of at least 3p per share  
commencing in 2012
principal risks and uncertainties 
internal controls and an effective risk 
management regime are integral to the 
group’s continued operation overall 
responsibility for the risk management 
processes adopted by the group lies with 
the board on behalf of the board the 
audit committee reviews the effectiveness 
of the group’s internal control policies 
and procedures for the identification 
assessment and reporting of risks in order 
to maintain oversight and seek comfort as 
to group policies and procedures the audit 
committee recommended to the board 
that an independent internal auditor be 
put in place to act as a tool to rigorously 
and continuously test group procedures 
a candidate has been identified and it is 
anticipated the candidate will commence 
his duties with effect from 1 july 201 1 for 
further details in respect of the group’s 
internal control processes please refer to the 
corporate governance section of this report
in this section we describe the group’s 
principal risks and uncertainties we provide 
information on the nature of the risk actions 
to mitigate risk exposure and an indication 
of the significance of the risk by reference to 
its potential impact on the group’s business 
financial condition and results of operation 
andor the likelihood of the risk materialising 
not all potential risks are listed below 
some risks are excluded because the board 
considers them not material to the group 
as a whole additionally there may be risks 
and uncertainties not presently known to the 
directors or which the directors currently 
deem immaterial that may also have an 
adverse effect upon the group
number of issued shares 42677292
held in treasury by park plaza hotels limited 862000
number of issued shares excluding treasury 41815292
shareholders with holdings of 3 or more  
of the company’s issued share capital  
excluding treasury as at 10 may 2011 
 
number of  
shares
percentage of 
issued share capital 
excluding treasury
red sea group 18679141 447
molteno limited  8285024 198 
aroundtown property holdings limited 3762000 90
goldman sachs managed funds 3636364 87 
  421424 shares of the total shares owned by pphl holding bv are held by the red sea group and molteno limited 
these shares are counted in both the totals for the red sea group and molteno limited in the table above
32   park plaza hotels annual report 2010 directors’ report
risk and impact mitigation grading
risk name
information technology and systems  
the group is reliant on certain technologies 
and systems for the operation of its business 
any material disruption or slowdown of the 
group’s information systems especially any 
failures relating to its reservation system 
could cause valuable information to be lost 
or operations to be delayed
in addition the group and each of its hotels 
maintain personal customer data which 
are also shared and retained by the group’s 
partner such information may be misused 
by the group’s or its partner’s employees or 
other outsiders if there is an inappropriate 
or unauthorised access to the relevant 
information systems
the group invests in appropriate it  
systems so as to obtain as much operational 
resilience as possible further a variety  
of security measures is implemented in  
order to maintain the safety of personal 
customer information
high
market and hotel industry risks the group’s 
operations and the results of its operations 
are subject to a number of factors that could 
adversely affect the group’s business many 
of which are common to the hotel industry 
and beyond the group’s control such as 
the global economic downturn changes in 
travel patterns or in the structure of the travel 
industry and the increase in acts of terrorism 
the impact of any of these factors or a 
combination of them may adversely affect 
sustained levels of occupancy room rates 
andor hotel values
although management continually seeks to 
identify risks at the earliest opportunity many 
of these risks are beyond the control of the 
group the group has in place contingency 
and recovery plans to enable it to respond 
to major incidents or crises and takes steps 
to minimise these exposures to the greatest 
extent possible
high
key senior personnel and management the 
success of the group’s business is partially 
attributable to the efforts and abilities of its 
senior managers and key executives failure 
to retain its executive management team or 
other key personnel may threaten the success 
of the group’s operations
the group has appropriate systems in place 
for recruitment reward and compensation 
and performance management development 
and maintenance of a group culture also 
plays a leading role in minimising this risk
medium
fixed operating expenses the group’s 
operating expenses such as personnel costs 
operating leases information technology and 
telecommunications are to a large extent 
fixed as such the group’s operating results 
may be vulnerable to shortterm changes  
in its revenues
the group has appropriate management 
systems in place such as staff outsourcing 
designed to create flexibility in the operating 
cost base so as to optimise operating profits 
in volatile trading conditions
medium
park plaza hotels annual report 2010   33 directors’ report continued
risk and impact mitigation grading
risk name
foreign exchange rate fluctuations the 
exchange rates between the functional 
currency of the group’s subsidiaries 
operating outside the eurozone and the euro 
the reporting currency for the purposes of 
the consolidated financial statements may 
fluctuate significantly affecting the group’s 
financial results in addition the group may 
incur currency transaction risk in the event 
that one of the group companies enters into 
a transaction using a different currency from 
its functional currency
the group eliminates currency transaction 
risk by matching commitments cash flows 
and debt in the same currency
low
the park plaza
®
 hotels  resorts brand 
and reservation system the group’s rights 
to the park plaza
®
 hotels  resorts brand 
stem from a territorial licence agreement with 
carlson pursuant to which the group has 
the exclusive right to use and to sublicense 
others to use the park plaza
®
 hotels  
resorts trademark in 56 countries within  
the emea region this agreement also  
allows the group to use carlson’s highly  
costeffective central reservation system 
failure to maintain these rights could 
adversely affect the group’s brand 
recognition and its profitability 
the group’s rights to use the park plaza
®
 
hotels  resorts brand and carlson’s  
central reservation system are in perpetuity  
this unique and exclusive partnership is 
reinforced by the group’s continued focus  
on operational efficiency and portfolio 
growth through its intensified cooperation 
with carlson 
low
guaranteed return of investment to park 
plaza westminster bridge london 
unitholders marlbray limited the freehold 
owner of park plaza westminster bridge 
london and the company have guaranteed 
directly or indirectly to the purchasers of 
units in park plaza westminster bridge 
london a 5 or 6 return on their investment 
as the case may be for a period of five years 
from the date of the sale to the extent that 
net income is less than the guaranteed return 
marlbray and park plaza hotels will be 
obliged to make up any shortfall
marlbray is entitled to receive and retain 
all net income generated by the units sold 
during the term of the guarantees and if such 
income exceeds guaranteed return marlbray 
benefits from the surplus this arrangement 
combined with a regular monitoring of 
revenues allows management to effectively 
control costs and to minimise the impact of 
any shortfalls
low
the group’s borrowings the group is 
exposed to a variety of risks associated with 
the group’s existing bank borrowings and 
its ability to satisfy debt covenants failure 
to satisfy obligations under any current or 
future financing arrangements could give 
rise to default risk and require the group to 
refinance its borrowings
the board monitors funding needs regularly 
financial covenant ratios are monitored 
and sensitised as part of normal financial 
planning procedures
low
tax risk as the group operates in a number 
of jurisdictions changes to the tax laws or 
practice in any of these jurisdictions may have 
adverse consequences to the group’s profits
the group has developed adequate presence 
in its key jurisdictions to manage the risks that 
changing tax legislation may present 
low
34   park plaza hotels annual report 2010 directors’ report continued
directors
the directors who served throughout the 
year were as follows
•	 eli papouchado nonexecutive chairman
•	 boris ivesha president and chief  
executive officer
•	 chen moravsky chief financial officer
•	 kevin mcauliffe senior independent  
nonexecutive director
•	 elisha flax independent  
nonexecutive director
•	 nigel jones independent  
nonexecutive director
at each annual general meeting any director 
who was elected or last reelected at or 
before the annual general meeting held in 
the third calendar year preceding that annual 
general meeting shall retire from office by 
rotation in addition such further directors 
if any shall retire by rotation as would bring 
the number retiring by rotation up to  
onethird of the number of directors in office  
at the date of the notice of the meeting  
in each case a retiring director shall be 
eligible for reelection
details of the directors’ remuneration are 
included within the remuneration report 
largest shareholders
the table provided on page 32 contains 
shareholders holding 3 or more of  
the ordinary shares as at 10 may 201 1  
of which the company has been notified  
by its registrar 
auditors 
ernst  young llp have expressed their 
willingness to continue in office and a 
resolution to reappoint them will be 
proposed at the forthcoming annual  
general meeting
going concern 
the board believes it is taking all appropriate 
steps to support the sustainability and growth 
of the group’s activities detailed budgets and 
cash flow projections have been prepared for 
201 1 and 2012 which show that the group’s 
hotel operations will be cash generative during 
the period this taken together with their 
conclusions on the matters referred to below 
and in note 1  c  to the financial statements 
have led the directors to conclude that it is 
appropriate to prepare the 2010 financial 
statements on a going concern basis
directors’ responsibilities 
the directors are required to prepare 
the directors’ report and the financial 
statements for each financial year which 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 those 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 and
•	 prepare the financial statements on a going 
concern basis unless it is inappropriate to 
presume that the company will continue in 
business
the directors confirm that they have 
complied with the above requirements in 
preparing the financial statements 
the directors are responsible for keeping 
proper accounting records which disclose 
with reasonable accuracy at any time the 
financial position of the company and enable 
them to ensure that the financial statements 
have been properly prepared in accordance 
with the companies guernsey law 2008 
as amended they are also responsible for 
safeguarding the assets of the company and 
hence for taking reasonable steps for the 
prevention and detection of fraud and other 
irregularities
so far as each of the directors is aware there 
is no relevant audit information of which the 
company’s auditor is unaware and each has 
taken all the steps he ought to have taken 
as a director to make himself aware of any 
relevant audit information and to establish 
that the company’s auditor is aware of that 
information 
directors’ responsibility statement 
the board confirms to the best of its 
knowledge that the financial statements 
which have been prepared in accordance 
with ifrs as adopted by the eu give a true 
and fair view of the assets liabilities financial 
position and profit and loss of the group 
the business review which is incorporated 
into the directors’ report includes a fair 
view of the development and performance 
of the business and the position of the 
group and the undertakings included in the 
consolidation taken as a whole together 
with a description of the principal risks and 
uncertainties that they face 
boris ivesha 
president and chief executive officer
chen moravsky 
chief financial officer
1 june 201 1
park plaza hotels annual report 2010   35 corporate governance
introduction
as a company listed on aim the company 
is not required to comply or explain against 
the requirements of the uk corporate 
governance code the “corporate 
governance code” published by the 
financial report council the board has 
however put in place a framework for 
corporate governance which enables the 
company to voluntarily comply with the  
main requirements of the corporate 
governance code
the directors are committed to maintaining 
a high standard of corporate governance 
and intend to continue to comply with those 
aspects of the corporate governance code 
which they consider appropriate taking into 
account the size of the company and the 
nature of its business
board composition roles and independence 
the company currently has six directors 
four of whom are nonexecutives including 
the chairman eli papouchado the two 
executive directors are boris ivesha chief 
executive officer and chen moravsky chief 
financial officer
the corporate governance code 
recommends that the board of directors of 
a listed company should include a balance of 
executive and nonexecutive directors and 
in particular nonexecutive directors such 
that no individual or group of individuals 
can dominate the board’s decision making 
the corporate governance code also 
recommends that the chairman should  
on appointment be independent
as recommended by the corporate 
governance code three of the directors 
being more than half of the board excluding 
the chairman namely 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 kevin mcauliffe  
has an indirect 1 interest in cl secretaries 
limited the company’s secretary the board 
does not however consider this interest to be 
sufficiently material to affect mr mcauliffe’s 
independence the company’s chairman eli 
papouchado is the founder of the red sea 
group of which euro sea the company’s 
largest shareholder is a part and was not 
therefore on appointment and is not 
independent of the company however  
the board believes that mr papouchado’s 
extensive experience and knowledge of the 
group’s business as well as the hotel business 
generally justify this departure from the 
recommendations of the corporate 
governance code
as recommended by the corporate 
governance code the board has appointed 
kevin mcauliffe as the senior independent 
director to provide a sounding board for the 
chairman and to serve as an intermediary for 
the other directors when necessary
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 group’s general 
counsel and are able to gain access to 
external independent advice should they  
wish to do so
an appropriate balance of executive and 
nonexecutive members of the board is 
maintained and the board is supplied with 
regular and timely information concerning 
the activities of the group in order to enable 
it to exercise its responsibilities and control 
functions in a proper and effective manner
the board has a breadth of experience 
relevant to the company and the directors 
believe that any changes to the board’s 
composition can be managed without 
undue disruption with any new director 
appointment to the board an appropriate 
induction will be set up 
the board considers agenda items laid out in 
the notice of general meeting and agenda 
which are formally circulated to the board 
in advance of the board meetings as part of 
the board papers and therefore 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
the primary focus at board meetings is a 
review of operating performance potential 
investments and joint ventures and 
matters such as financing arrangements 
as well as marketinginvestor 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 and believes that the mix 
of skills experience ages and length of 
service is appropriate to the requirements 
of the company the directors retire and 
stand for reelection in accordance with the 
provisions set out in the company’s articles 
of incorporation 
the roles of chairman and the chief 
executive officer are separate and clearly 
defined the scope of these roles is approved 
and kept under review by the board so  
that no individual has unfettered  
decisionmaking powers 
36   park plaza hotels annual report 2010 corporate governance
the chairman is responsible for the 
leadership and governance of the board 
and the chief executive officer for the 
management of the group and the 
implementation of board strategy and policy 
on the board’s behalf in discharging his 
responsibilities the chief executive officer is 
advised and assisted by senior management
during the financial year the board held 
seven board and board committee meetings 
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
•	 oversight of management and  
personnel matters
•	 risk assessment and management 
including reporting
•	 monitoring governance and control and
•	 other matters having material effects  
on the company
these reserved powers of the board have 
been adopted by the directors to clearly 
demonstrate the seriousness with which 
the board takes its fiduciary responsibilities 
and as an ongoing means of measuring and 
monitoring the effectiveness of its actions 
external appointments
directors may hold directorships or other 
significant interests with companies 
outside of the group which may have 
business relationships with the group 
executive directors may not accept external 
directorships and retain any fees earned 
from those directorships subject to prior 
discussion with the chief executive officer 
and always provided this does not lead to any 
conflicts of interest in the case of the chief 
executive officer prior discussion will need  
to be held with the chairman
directors’ indemnities and protections
the company has arranged appropriate 
insurance cover in respect of legal action 
against directors and senior managers of 
companies within the group in addition the 
articles of incorporation of the company 
permit the directors and officers of the 
company to be indemnified in respect of 
liabilities incurred as a result of their office 
board committees
in accordance with the corporate 
governance code the company has 
established the following committees in 
order to carry out work on behalf of the 
board an audit committee a remuneration 
committee and a nominations committee 
audit committee
an audit committee has been established 
and comprises kevin mcauliffe chairman 
elisha flax and nigel jones and meets at  
least three times a year the audit  
committee assists the board in observing  
its responsibility for ensuring that the  
group’s financial systems provide accurate 
and uptodate information on its financial 
position and that the published financial 
statements represent a true and fair reflection 
of this position it 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 chief financial officer the company 
secretary and the external auditors 
contrary to the requirements of the 
corporate governance code none of the 
members of the audit committee have 
recent and relevant experience which for 
these purposes is taken to be a professional 
qualification from one of the professional 
accounting bodies however the board 
considers that the existing committee 
members’ substantial experience of dealing 
with financial matters is more than adequate 
to enable the committee to properly 
discharge its duties in light of the nature of 
the company’s business the company will 
keep the requirement for a director with 
recent and relevant experience under review
audit committee report for 2010
the audit committee met seven times  
during the year attendance of the individual 
directors who all served on the committee 
throughout the year is shown in the  
table below 
date of 
meeting
kevin 
mcauliffe
elisha  
flax
nigel 
jones
19012010   
02032010   
23032010   
21062010   
20092010   
22112010   
08122010   
during these meetings the audit committee 
considered the following
•	 the integrity of the financial statements 
and other formal announcements relating 
to the group’s financial performance and 
in particular reviewed the judgements 
that are contained within the financial 
statements
•	 refinancing transactions
•	 third party related transactions
•	 renovation plans and the growth of the 
propertyasset portfolio
•	 the group’s internal control and risk 
management policies and systems and 
their effectiveness
•	 the current and future requirements for an 
internal audit function in the context of the 
group’s overall risk management system
•	 the committee reviewed the auditor 
performance during the year and 
recommends that the board presents the 
resolution to the shareholders at the 201 1 
agm to reappoint ernst  young llp as 
external auditors 
composition of board
 
executive directors 2
nonexecutive directors 4
park plaza hotels annual report 2010   37 corporate governance continued
objectives achieved following 
recommendations by the audit committee
1  in order to closely monitor performance 
liaising with the chief financial officer  
who now reports to the committee 
verbally and by way of written report  
on a monthly basis
2  having identified possible corporate 
governancestatutory risk in view of 
the rapid growth of the portfolio the 
audit committee recommended that 
specific expertise be employed to ensure 
compliance general counsel for the 
group was subsequently appointed  
in november 2010
3  in order to maintain oversight and 
seek comfort as to group policies 
and procedures the audit committee 
recommended to the board that an 
independent internal auditor be put in 
place to act as a tool to rigorously and 
continuously test group procedures 
interviews were undertaken and a 
candidate identified it is anticipated the 
candidate will commence his duties with 
effect from 1 july 201 1
remuneration committee
a remuneration committee has been 
established and comprises kevin 
mcauliffe chairman and elisha flax the 
remuneration committee advises the board 
on an overall remuneration policy and meets 
as and when required the remuneration 
committee 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 
nonexecutive directors
there has been one remuneration 
committee meeting during 2010
nominations committee
a nominations committee has been 
established and comprises elisha flax 
chairman nigel jones and kevin mcauliffe 
whenever possible all such nonexecutive 
directors are present at meetings of the 
nominations committee the nominations 
committee carries out the selection process 
for the appointment of candidates to the 
board and proposes names for approval  
by the full board
there have been no new candidates to the 
board and the nominations committee has 
therefore not been convened during 2010 
communications with shareholders
the board is accountable to the company’s 
shareholders and as such it is important 
for the board to appreciate the aspirations 
of the shareholders and equally that the 
shareholders understand how the actions 
of the board and shortterm financial 
performance relate to the achievement  
of the company’s longer term goals 
the board reports to the shareholders on 
its stewardship of the company through the 
publication of interim and final results each 
year press releases are issued throughout the 
year and the company maintains a website 
wwwparkplazahotelsnet on which press 
releases and the annual report and accounts 
are available to view additionally this annual 
report contains extensive information about 
the company’s activities enquiries from 
individual shareholders on matters relating to 
the business of the company are welcomed 
the executive directors also meet with  
major shareholders to discuss the progress  
of the company
the chief executive officer and the  
chief financial officer provide periodic 
feedback to the board following meetings 
with shareholders 
the annual general meeting provides an 
opportunity for communication with all 
shareholders and the board encourages 
the shareholders to attend and welcomes 
their participation the directors attend the 
annual general meeting and are available to 
answer questions details of resolutions to  
e proposed at the annual general meeting of 
the company to be held on 16 june 201 1 are 
included in the notice of agm which  
has been posted to shareholders and can  
be found on the company’s website  
wwwparkplazahotelsnet 
38   park plaza hotels annual report 2010 internal controls
in september 1999 the turnbull guidance 
internal control guidance for directors  
on the combined code was published  
and revised in october 2005
the directors acknowledge their responsibility 
for establishing and maintaining the group’s 
and the company’s systems of internal 
control these are designed to safeguard  
the assets of the group and to ensure the 
reliability of financial information for both 
internal use and external publication
the group’s internal control procedures 
include board approval for all significant 
projects all major expenditures require either 
senior management or board approval at the 
appropriate stages of each transaction  
a system of regular reporting covering both 
technical progress of projects and the state  
of the group’s financial affairs provides 
appropriate information to management  
to facilitate control the board reviews 
identifies evaluates and manages the 
significant risks that face the group
any systems of internal control can only 
provide reasonable and not absolute 
assurance that material financial irregularities 
will be detected or that the risk of failure to 
achieve business objectives is eliminated the 
directors having reviewed the effectiveness 
of the system of internal financial operational 
and compliance controls and risk 
management consider that the system  
of internal control operated effectively 
throughout the financial year and up to the 
date the financial statements were signed
share dealing code
the company has adopted a share dealing 
code for directors and relevant employees 
which is appropriate for an aim quoted 
company and is in accordance with rule 21 
of the aim rules
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
e ssdcapitaregistrarscom
t  uk 0871 664 0300
calls cost 10p per minute plus network extras
t  overseas 44 208 639 3399
lines are open monday to friday  
830am to 530pm
investor relations enquiries 
chen moravsky 
chief financial officer 
viñoly tower 5th floor 
claude debussylaan 14 
1082 md amsterdam 
the netherlands
t  31 020 717 8603 
f 31 020 717 8699 
e cmoravskypphecom 
wwwparkplazahotelsnet
website
annual reports half year reports and shared 
information are all available on our website 
wwwparkplazahotelsnet
financial calendar
financial year 1 january to 31 december  
earnings releases 30 june 31 december  
annual general meeting 16 june 201 1
london stock exchange trading code
pphl
corporate governance continued
park plaza hotels annual report 2010   39 report of the remuneration committee  
and directors’ remuneration report
remuneration policy 
the company’s remuneration policy is designed to attract motivate and retain highcalibre individuals to enable the group to operate 
strategically for the continued benefit of shareholders over the long term the remuneration committee aims to provide executive directors 
and senior managers with packages which are sufficiently competitive to attract retain and motivate individuals of the quality required to 
achieve the group’s strategic objectives and enhance shareholder value remuneration packages are aimed at balancing both shortterm and 
longterm rewards as well as performance and nonperformance related pay 
the remuneration of nonexecutive directors is a matter for the board no director or manager may be involved in any decisions as to  
hisher own remuneration 
within the framework of the agreed remuneration policy the remuneration committee determines the remuneration package of the chairman 
the executive directors and other senior managers including the size of and the performance conditions applying to awards made under 
the company’s cash bonus and share option schemes the remuneration committee also advises the board on employee benefit structure 
throughout the group the chief executive officer and the chief financial officer may provide advice to the remuneration committee as 
necessary save in respect of their own remuneration 
service contracts and letters of appointment 
the executive directors have rolling service contracts which may be terminated on 12months’ notice by the company or on 6months’ notice 
by the executive director there are provisions for earlier termination by the company in certain specific circumstances 
each nonexecutive director has specific terms of reference their letters of appointment provide for an initial threeyear period subject to 
termination by either side on three months’ notice the letters of appointment contain no entitlement of compensation for early termination 
details of the contract dates and notice periods are set out below 
 
name of directors
date of 
appointment
 
notice period
elisha flax 17 july 2007 3 months
boris ivesha 26 june 2007 12 months from 
company 6 months 
from mr ivesha
kevin mcauliffe 26 june 2007 3 months
chen moravsky 26 june 2007 12 months from 
company 6 months 
from mr moravsky
nigel jones 26 june 2007 3 months
eli papouchado 17 july 2007 3 months
  other than salary and benefits in relation to the notice period described above there are no other terms in any of the contracts which would give rise to compensation payable for early 
termination or any other liability of the company
nonperformance related remuneration 
basic salaries and benefits are reviewed by the remuneration committee annually executive directors are entitled to do insurance 
the chairman’s and nonexecutive directors’ fees are reviewed on a biannual basis by the entire board 
pensions 
mr ivesha is entitled to pension contributions of £100000 per annum and mr moravsky is entitled to pension contributions at the rate  
of 15 of annual salary otherwise the directors are not entitled to pension plans
40   park plaza hotels annual report 2010 report of the remuneration committee  
and directors’ remuneration report
performance related remuneration 
the company did not grant performance related remuneration in the years ended 31 december 2010 and 2009 
the auditors have audited the following parts of the remuneration report 
directors’ remuneration €’000
chairman and executive directors eli papouchado boris ivesha chen moravsky total
salary and fees 117 395 275 787
other taxable benefits – 191 105 296
total remuneration for the year  
ended 31 december 2010
117 586 380 1083
total remuneration for the year  
ended 31 december 2009
113 430 365 908
nonexecutive directors kevin mcauliffe nigel jones elisha flax total
salary and fees 46 41 47 134
total remuneration for the year  
ended 31 december 2010
46 41 47 134
total remuneration for the year  
ended 31 december 2009
34 34 45 113
details of share awards and options granted to directors are included in the table below no share awards or options have been exercised 
during the year 
director no of options
number vested as  
at 31 december 2010 exercise price
chen moravsky 95000 – £100
on behalf of the board
kevin mcauliffe
chairman of the remuneration committee
park plaza hotels annual report 2010   41 board of directors
boris ivesha 65 
president and chief executive officer
mr 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 he has been one of 
the major drivers behind the expansion of the 
group’s portfolio
eli papouchado 73 
nonexecutive chairman
mr papouchado is the founder of the red 
sea group and has previously acted as the 
chairman of its board for 10 years he has 
been involved in the construction design 
development financing acquisition and 
management of leading hotels including 
park plaza westminster bridge london 
park plaza riverbank london park plaza 
victoria london park plaza leeds park 
plaza nottingham park plaza victoria 
amsterdam the milestone taba hotel and 
many others mr papouchado was involved 
in the development of hundreds of thousands 
of square meters 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 israel hotel association
chen moravsky 40 
chief financial officer 
mr moravsky was the financial director 
of the red sea group before joining park 
plaza hotels in 2005 he joined the red sea 
group in 2001 where he gained his expertise 
in the hotelleisure business and real estate 
investment market mr moravsky was 
previously employed as an audit manager at 
deloitte 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
42   park plaza hotels annual report 2010 board of directors
elisha flax 49 
nonexecutive director
mr flax is a real estate entrepreneur engaged 
in various real estate activities in eastern 
europe he served as a nonexecutive director 
of delek global real estate plc an aimlisted 
real estate company until 2010 mr flax 
was previously employed as a solicitor at the 
london offices of us law firms chadbourne 
 parke and akin gump strauss hauer 
 feld and general counsel at planestation 
limited he holds an llb degree from keio 
university in tokyo japan and is a qualified 
solicitor in england and wales
kevin mcauliffe 53
nonexecutive director 
senior independent director
mr mcauliffe is currently the executive 
chairman of carey group having joined that 
business as chief executive in 1999 prior to 
this he was head of advisory services for 
paribas international private banking and 
the managing director of paribas suisse in 
guernsey previously the finance director of 
the ansbacher offshore banking group he 
was appointed chief executive of ansbacher’s 
guernsey bank and trust company business 
in 1994 from 1973 to 1980 he held posts in 
three different departments in the states of 
guernsey he is a member of the society of 
trust and estate practitioners and a director 
of various regulated investment companies
nigel jones 49 
nonexecutive director
mr jones has been a member of the royal 
institution of charted surveyors since 1989 
he was the chief executive of comprop 
limited an aim listed property company 
based in guernsey between 2001 and 2007  
during that period he was responsible 
for major office developments including 
headquarter offices for fortis kleinwort 
benson and generali as well as retail 
stores for bq which are now occupied 
by waitrose mr jones initially worked in 
southampton for humberts dealing with the 
management of coastal land that formed 
part of the crown estate having moved 
to guernsey he established the island’s first 
dedicated commercial property practice in 
1995 his directorships include uk care no 
1 which holds leases on approximately 100 
bupa care homes matrix property fund 
guernsey limited threadgreen industrial 
limited and b l management guernsey  
201 1 limited part of the british land 
company plc
park plaza hotels annual report 2010   43 consolidated balance sheets 
44   park plaza hotels annual report 2010 
 
as at 31 december 
 
note 
2010 
€’000 
2009 
€’000 
assets    
noncurrent assets    
intangible assets 4 42313 44882 
property plant and equipment 5 605242 188625 
aparthotel units sold to unit holders 6 160586 – 
prepaid leasehold payments 7 244 254 
investment in associate 8 22140 22468 
other noncurrent financial assets 10 27389 35306 
  857914 291535 
current assets    
inventories under construction 11 – 304817 
restricted deposits and cash 17b 21999 66516 
inventories  1351 527 
other current financial assets 9 1671 14536 
trade receivables 12 17176 14385 
other receivables and prepayments 13 9557 5137 
cash and cash equivalents 14 25637 34418 
  77391 440336 
total assets  935305 731871 
the accompanying notes are an integral part of the consolidated financial statements  consolidated balance sheets 
park plaza hotels annual report 2010   45 
 
 as at 31 december 
 note 
2010 
€’000 
2009 
€’000 
equity and liabilities    
equity 15   
issued capital  – – 
share premium   237729 236000 
other reserves  36445 36418 
treasury shares  1083 1083 
foreign currency translation reserve  36507 28376 
hedging reserve  1087 9096 
accumulated earnings deficit  40611 21292 
total equity  203218 139735 
noncurrent liabilities    
bank borrowings 18 261570 171865 
advance payments from unit holders  176503 – 
other liabilities 19 65299 51011 
deferred income taxes 26 8770 9655 
  512142 232531 
current liabilities    
trade payables 29 24998 4853 
deposits received from unit holders 17b 18234 63757 
other payables and accruals 20 37419 13128 
bank borrowings 18 139294 277867 
  219945 359605 
total liabilities  732087 592136 
total equity and liabilities  935305 731871 
the accompanying notes are an integral part of the consolidated financial statements 
date of approval of the financial statements 1 june 2011 
boris ivesha president and chief executive officer chen moravsky chief financial officer  consolidated income statements 
46   park plaza hotels annual report 2010 
 
  year ended 31 december 
 note 
2010 
€’000
1
 
2009 
€’000
1
 
revenues 21 139829 80326 
operating cost 22 93382 54182 
ebitdar  46447 26144 
rental expenses  8814 9900 
ebitda  37633 16244 
depreciation and amortisation  12409 9066 
ebit  25224 7178 
financial expenses 23 28873 18940 
financial income 24 10421 5797 
other income net 25 60351 – 
interest expenses guaranteed to unit holders  4279 – 
share in loss of associate 8 2362 1195 
profit loss before tax  60482 7160 
income tax benefit expense  26 1421 289 
profit loss for the year  61903 7449 
basic and diluted earnings loss per share in euro 27 15 02 
1
 except earnings per share 
the accompanying notes are an integral part of the consolidated financial statements  consolidated statements of comprehensive income 
park plaza hotels annual report 2010   47 
  year ended 31 december 
 note 
2010 
€’000 
2009 
€’000 
profit loss for the year  61903 7449 
other comprehensive income loss    
fair value gain on availableforsale financial assets  289 348 
reclassification adjustment for profit loss from availableforsale financial assets recorded  
in income statement  346 246 
loss from cash flow hedges  911 2715 
breakage of hedge financial instruments  8920 – 
reclassification adjustment in respect of foreign currency translation reserve  3c 9390 – 
foreign currency translation adjustments of foreign operations  1205 3762 
foreign currency translation adjustment of associate  54 26 
other comprehensive loss income   179 1667 
total comprehensive income loss attributable to owners of the parent  61724 5782 
the accompanying notes are an integral part of the consolidated financial statements  consolidated statements of changes in equity 
48   park plaza hotels annual report 2010 
 
issued 
capital 
share 
premium 
other 
reserves 
treasury 
shares 
foreign 
currency 
translation 
reserve 
hedging 
reserve 
retained 
earnings 
accumulative 
deficit total 
balance as at 1 january 2009 – 236000 37189 – 32164 6381 13843 146423 
loss for the year – – – – – – 7449 7449 
other comprehensive income for the year – – 594 – 3788 2715 – 1667 
total comprehensive loss – – 594 – 3788 2715 7449 5782 
purchase of treasury shares – – – 1083 – – – 1083 
sharebased payments – – 177 – – – – 177 
balance as at 31 december 2009 – 236000 36418 1083 28376 9096 21292 139735 
profit for the year – – – – – – 61903 61903 
other comprehensive loss for the year – – 57 – 8131 8009 – 179 
total comprehensive income – – 57 – 8131 8009 61903 61724 
issue of shares – 1729 – – – – – 1729 
sharebased payments – – 30 – – – – 30 
balance as at 31 december 2010 – 237729 36445 1083 36507 1087 40611 203218 
 no par value 
the accompanying notes are an integral part of the consolidated financial statements  consolidated statements of cash flows 
park plaza hotels annual report 2010   49 
 
 year ended 31 december 
 
2010 
€’000 
2009 
€’000 
cash flows from operating activities   
profit loss for the year 61903 7449 
adjustment to reconcile profit loss to cash used in operating activities    
financial expenses 33151 18940 
financial income 10421 5797 
income tax income expense 1421 289 
negative goodwill on acquisition of schiphol victoria hotel cv 308 – 
negative goodwill on acquisition of park plaza leeds and park plaza nottingham 1756 – 
negative goodwill on acquisition of park plaza sherlock holmes london park plaza riverbank london  
and park plaza victoria london 7933 – 
capital gain from obtaining control of a former jointly controlled entity 50825 – 
share in loss of associates 2362 1195 
depreciation and amortisation 12409 9075 
sharebased payments 30 177 
 24712 23879 
changes in operating assets and liabilities   
increase in inventories under construction 5013 80951 
increase decrease in inventories 663 3 
increase in trade and other receivables 5658 2424 
increase decrease in trade and other payables 11112 5708 
 222 89080 
cash paid and received during the year for   
interest paid 22880 12549 
interest received 1011 609 
taxes paid 170 – 
taxes received 119 63 
 21818 12003 
net cash from used in operating activities  15151 84653 
cash flows from investing activities   
purchase of property plant and equipment 23101 3345 
net change in cash upon acquisition of schiphol victoria hotel cv a 739 – 
net change in cash upon acquisition of park plaza leeds and park plaza nottingham b 9619 – 
net change in cash upon acquisition of park plaza sherlock holmes london park plaza riverbank london  
and park plaza victoria london c 2945 – 
loans to jointly controlled entities and to partners in jointly controlled entities 8396 1670 
decrease increase in restricted deposits 45127 8019 
purchase of availableforsale investment in bonds and securities 693 12279 
proceeds from maturity of bonds and securities – 23073 
purchase of availableforsale investment in shares 390 15945 
proceeds from sale of availableforsale investment in shares 14723 16136 
purchase of treasury shares – 1083 
advance payments from unit holders 130538 – 
decrease in restricted cash 28 320 
loans to unit holders 2180 – 
net cash from used in investing activities 148243 2812 
the accompanying notes are an integral part of the consolidated financial statements 
  consolidated statements of cash flows 
50   park plaza hotels annual report 2010 
 year ended 31 december 
 
2010 
€’000 
2009 
€’000 
cash flows from financing activities    
increase in deposits from unit holders 1757 3130 
proceeds from longterm loans 100358 42158 
repayment of longterm loans 114441 44485 
increase decrease in shortterm loans 169012 85032 
loans from jointly controlled entities and from partners in jointly controlled entities 8635 1733 
net cash from used in financing activities 172703 87568 
decrease increase in cash and cash equivalents 9309 103 
net foreign exchange differences 528 1250 
cash and cash equivalents at beginning of year 34418 33065 
cash and cash equivalents at end of year 25637 34418 
 
  year ended 31 december 
  
2010 
€’000 
2009 
€’000 
a net change in cash upon acquisition of schiphol victoria cv   
 current assets excluding cash and cash equivalents 393 – 
 current liabilities 536 – 
 noncurrent assets 15308 – 
 noncurrent liabilities 14000 – 
 negative goodwill 308 – 
 noncash transaction 118 – 
 net change in cash 739 – 
b net change in cash upon acquisition of park plaza leeds and park plaza nottingham   
 current assets excluding cash and cash equivalents 862 – 
 current liabilities 2330 – 
 noncurrent assets 40316 – 
 noncurrent liabilities 23837 – 
 noncash transactions 3636 – 
 negative goodwill 1756 – 
 net change in cash 9619 – 
c 
 
net change in cash upon acquisition of park plaza sherlock holmes london park plaza riverbank 
london and park plaza victoria london   
 current assets excluding cash and cash equivalents 3090 – 
 current liabilities 11807 – 
 noncurrent assets 135180 – 
 noncurrent liabilities 99520 – 
 negative goodwill 7933 – 
 noncash transactions 21955 – 
 net change in cash 2945 – 
d significant noncash transactions   
 purchase of inventories under construction and fixed assets 14081 – 
 issue shares 1729 – 
 significant noncash transactions  15810 – 
the accompanying notes are an integral part of the consolidated financial statements 
 notes to consolidated financial statements 
park plaza hotels annual report 2010   51 
note 1 general 
a the consolidated financial statements of park plaza hotels limited “the company” for the year ended 31 december 2010 were authorised 
for issuance in accordance with a resolution of the directors on 1 june 2011 
b description of business and formation of the company 
the company was incorporated and registered in guernsey on 14 june 2007 
the company’s primary activity is owning leasing developing operating and franchising full service fourstar fourstar deluxe and lifestyle 
hotels in major gateway cities and regional centres primarily in europe 
c assessment of going concern 
as part of their ongoing responsibilities the directors have recently undertaken a thorough review of the group’s cash flow forecast and 
potential liquidity risks 
the group has entered into a number of loan facilities the details of which are set out in note 17 and note 32 2 the board believes that 
the group currently has adequate resources and in the future will generate sufficient funds to honour its financial obligations and continue  
its operations as a going concern for the foreseeable future 
note 2 summary of significant accounting policies 
a basis of preparation 
statement of compliance 
the consolidated financial statements have been prepared on a historical cost basis except for derivative financial instruments and available
forsale financial assets that have been measured at fair value the consolidated financial statements are presented in euro and all values are 
rounded to the nearest thousand €000 except when otherwise indicated 
the consolidated financial statements of the company and all its subsidiaries jointlycontrolled entities and associates together “the 
group” have been prepared in accordance with international financial reporting standards ifrs as adopted by the european union 
the accounting policies used in preparing the consolidated financial statements for the years ended 31 december 2010 and 2009 are set  
out below these accounting policies have been consistently applied to the periods presented unless otherwise stated 
b presentation currency 
 the financial statements are presented in euro 
c basis of consolidation 
the financial statements of the subsidiaries and joint ventures are prepared for the same reporting year as the parent company using 
consistent accounting policies all intercompany balances and transactions income and expenses and profits and losses resulting from 
intragroup transactions 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 on which such control ceases  
the group has interests in hotels in the netherlands the united kingdom germany hungary and croatia for details on the group’s 
subsidiaries and investments as at 31 december 2010 see appendix a 
for details on the company’s interests in jointlycontrolled entities proportionately consolidated as at 31 december 2010 see appendix b 
d changes in accounting policies and disclosures 
the accounting policies adopted are consistent with those of the previous financial year except for the following new and amended ifrs and 
ifric interpretations effective 1 january 2010 
ifrs 2 sharebased payment group cashsettled sharebased payment transactions effective 1 january 2010 
ifrs 3 business combinations revised and ias 27 consolidated and separate financial statements amended effective 1 july 2009 including 
consequential amendments to ifrs 2 ifrs 5 ifrs 7 ias 7 ias 21 ias 28 ias 31 and ias 39  notes to consolidated financial statements continued 
52   park plaza hotels annual report 2010 
note 2 summary of significant accounting policies continued 
d changes in accounting policies and disclosures continued 
ias 39 financial instruments recognition and measurement – eligible hedged items effective 1 july 2009  
ifric 17 distributions of noncash assets to owners effective 1 july 2009 
improvements to ifrss may 2008 
improvements to ifrss april 2009 
the adoption of the standards or interpretations is described below 
 ifrs 2 sharebased payment revised 
the iasb issued an amendment to ifrs 2 that clarified the scope and the accounting for group cashsettled sharebased payment 
transactions the group adopted this amendment as at 1 january 2010 it did not have an impact on the financial position or performance  
of the group 
 ifrs 3 business combinations revised and ias 27 consolidated and separate financial statements amended 
ifrs 3 revised introduces significant changes in the accounting for business combinations occurring after becoming effective changes 
affect the valuation of noncontrolling interest the accounting for transaction costs the initial recognition and subsequent measurement  
of a contingent consideration and business combinations achieved in stages these changes will impact the amount of goodwill recognised 
the reported results in the period that an acquisition occurs and future reported results  
ias 27 amended requires that a change in the ownership interest of a subsidiary without loss of control is accounted for as a transaction 
with owners in their capacity as owners therefore such transactions will no longer give rise to 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 by ifrs 3 revised and ias 27 amended affect acquisitions or loss of control of subsidiaries and transactions with non
controlling interests after 1 january 2010 
the change in accounting policy was applied prospectively and had no material impact on earnings per share 
 ias 39 financial instruments recognition and measurement – eligible hedged items 
the amendment clarifies that an entity is permitted to designate a portion of the fair value changes or cash flow variability of a financial 
instrument as a hedged item this also covers the designation of inflation as a hedged risk or portion in particular situations the group has 
concluded that the amendment will have no impact on the financial position or performance of the group as the group has not entered into 
any such hedges  
 ifric 17 distribution of noncash assets to owners 
this interpretation provides guidance on accounting for arrangements whereby an entity distributes noncash assets to shareholders either  
as a distribution of reserves or as dividends the interpretation has no effect on either the financial position or performance of the group  
 improvements to ifrss 
in may 2008 and april 2009 the iasb issued an omnibus of amendments to its standards primarily with a view to removing inconsistencies 
and clarifying wording there are separate transitional provisions for each standard the adoption of the following amendments resulted in 
changes to accounting policies but did not have any impact on the financial position or performance of the group 
ifrs 5 noncurrent assets held for sale and discontinued operations clarifies that the disclosures required in respect of noncurrent assets and 
disposal groups classified as held for sale or discontinued operations are only those set out in ifrs 5 the disclosure requirements of other 
ifrss only apply if specifically required for such noncurrent assets or discontinued operations the group has concluded that the 
amendment will have no impact on the financial position or performance of the group as the group has no noncurrent assets held for sale 
ifrs 8 operating segments clarifies that segment assets and liabilities need only be reported when those assets and liabilities are included in 
measures that are used by the chief operating decision maker as the group’s chief operating decision maker does not review segment 
assets and liabilities the group has not disclosed this information in note 28  
ias 1 presentation of financial statements assets and liabilities classified as held for trading in accordance with ias 39 financial instruments 
recognition and measurement are not automatically classified as current in the statement of financial position the group analysed whether 
the expected period of realisation of financial assets and liabilities differed from the classification of the instrument this did not result in any 
reclassification of financial instruments between current and noncurrent in the statement of financial position 
ias 7 statement of cash flows explicitly states that only expenditure that results in recognising an asset can be classified as a cash flow from 
investing activities this amendment will impact amongst others the presentation in the statement of cash flows of the contingent 
consideration on the business combination completed in 2010 upon cash settlementthis amendment did not result in any reclassification 
ias 36 impairment of assets when discounted cash flows are used to estimate ‘fair value less cost to sell’ additional disclosure is required about 
the discount rate consistent with disclosures required when the discounted cash flows are used to estimate ‘value in use’ this amendment 
had no immediate impact on the consolidated financial statements of the group because the recoverable amount of its cash generating units 
is currently estimated using ‘value in use’ the amendment clarified that the largest unit permitted for allocating goodwill acquired in a 
business combination is the operating segment as defined in ifrs 8 before aggregation for reporting purposes the amendment has no 
impact on the group as the annual impairment test is performed before aggregation   notes to consolidated financial statements continued 
park plaza hotels annual report 2010   53 
note 2 summary of significant accounting policies continued 
other amendments resulting from improvements to ifrss to the following standards did not have any impact on the accounting policies 
financial position or performance of the group 
 issued in april 2009 
ifrs 2 sharebased payment 
ias 1 presentation of financial statements 
ias 17 leases 
ias 34 interim financial reporting 
ias 38 intangible assets 
ias 39 financial instruments recognition and measurement 
ifric 9 reassessment of embedded derivatives 
 judgements  
in the process of applying the group’s accounting policies management has made the following judgements which have the most significant 
effect on the amounts recognised in the consolidated financial statements 
 acquisition of subsidiaries that are not business combinations  
at the acquisition date of subsidiaries and operations the company determines whether the transaction constitutes an acquisition of a 
business in a business combination transaction pursuant to ifrs 3 if the acquisition does not constitute a business as defined in ifrs 3 the 
cost of purchase is allocated only to the identifiable assets and liabilities of the acquired company on the basis of their relative fair values at 
the date of purchase without allocating any amount to goodwill or deferred taxes and including any minority interest according to its share  
of the fair value of net identifiable assets at the acquisition date 
in determining whether a business was acquired the company evaluates whether the entity which was acquired is an integrated set of activities 
and assets conducted and managed for the purpose of providing a return to investors the following criteria which indicate acquisition of  
a business are considered the number of assets acquired the extent to which ancillary services to operate the property are provided and the 
complexity of the management of the property 
 finance lease commitments – group as lessee 
the group has entered into commercial land leases the group has determined based on an evaluation of the terms and conditions of the 
arrangements that it holds all the significant risks and reward of ownership of the land and accounts for the contracts as finance leases 
 estimates and assumptions 
the key assumptions made in the financial statements concerning uncertainties at the balance sheet date and the critical estimates computed 
by the group for which there is a risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next 
financial year are discussed below 
• impairment of nonfinancial assets 
the group’s impairment test for tangible and intangible assets is based on value in use calculations that use a discounted cash flow 
model the cash flows are derived from the budget of the cash generating unit being tested the recoverable amount is most sensitive  
to the discount rate used for the discounted cash flow model as well as the expected future cash inflows and the growth rate used for 
extrapolation purposes see notes 5 and 6 for further details including the carrying amounts of these assets at the balance sheet date  
and key assumptions used  
• determination of fair values in the context of business combinations  
when the group acquires a business it assesses the fair value of the assets acquired and liabilities assumed as well as ensuring 
appropriate classification and designation in accordance with the contractual terms economic circumstances and other relevant 
information at the acquisition date the group engages independent valuation specialists to determine such fair values in the case of 
property plant and equipment the valuer uses valuation techniques based on discounted cash flow models the cash flows are derived 
from the forecasts for the businesses acquired and the fair value so determined is sensitive to the discount rate used for discounting the 
cash flow model as well as the assumptions inherent in the forecasts the key assumptions used to determine the fair value in the context 
of business acquisitions is further explained in note 3 
• sharebased payment transactions 
the group measures the cost of equitysettled transactions with employees by reference to the fair value of the equity instruments at the 
date at which they are granted estimating fair value for sharebased payment transactions requires determining the most appropriate 
valuation model which is dependent on the terms and conditions of the grant this estimate also requires determining the most 
appropriate inputs to the valuation model including the expected life of the share option volatility and dividend yield and making 
assumptions about them the assumptions and models used for estimating fair value for sharebased payment transactions are disclosed 
in note 16 
• deferred tax assets 
deferred tax assets are recognised for unused carry forward tax losses and temporary differences to the extent that it is probable that 
taxable profit will be available against which the losses can be utilised significant management judgement is required to determine the 
amount of deferred tax assets that can be recognised based upon the likely timing and level of future taxable profits together with future 
tax planning strategies additional information is provided in note 26  notes to consolidated financial statements continued 
54   park plaza hotels annual report 2010 
note 2 summary of significant accounting policies continued 
e business combinations and goodwill 
 business combinations from 1 january 2010 
business combinations are accounted for using the acquisition method the cost of an acquisition is measured as the aggregate of the 
consideration transferred measured at acquisition date fair value and the amount of any noncontrolling interest in the acquiree for each 
business combination the acquirer measures the noncontrolling interest in the acquiree either at fair value acquisition costs incurred are 
expensed and included in administrative expenses 
when the group acquires a business it assesses the financial assets and liabilities assumed for appropriate classification and designation  
in accordance with the contractual terms economic circumstances and pertinent conditions as at the acquisition date this includes the 
separation of embedded derivatives in host contracts by the acquiree 
if the business combination is achieved in stages the acquisition date fair value of the acquirer’s previously held equity interest in the acquiree 
is remeasured to fair value at the acquisition date through profit or loss any contingent consideration to be transferred by the acquirer will be 
recognised at fair value at the acquisition date subsequent changes to the fair value of the contingent consideration which is deemed to be 
an asset or liability will be recognised in accordance with ias 39 either in profit or loss or as a change to other comprehensive income if the 
contingent consideration is classified as equity it should not be remeasured until it is finally settled within equity 
goodwill is initially measured at cost being the excess of the aggregate of the consideration transferred and the amount recognised for  
noncontrolling interest over the net identifiable assets acquired and liabilities assumed if this consideration is lower than the fair value  
of the net assets of the subsidiary acquired the difference is recognised in profit or loss 
after initial recognition goodwill is measured at cost less any accumulated impairment losses for the purpose of impairment testing 
goodwill acquired in a business combination is from the acquisition date allocated to each of the group’s cashgenerating units that are 
expected to benefit from the combination irrespective of whether other assets or liabilities of the acquiree are assigned to those units where 
goodwill forms part of a cashgenerating unit and part of the operation within that unit is disposed of the goodwill associated with the 
operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation 
goodwill disposed of in this circumstance is measured based on the relative values of the operation disposed of and the portion of the cash
generating unit retained 
 business combinations involving entities under common control 
the group accounts for business combinations that include entities under common control using the acquisition method provided that the 
transaction has substance 
 business combinations prior to 1 january 2010 
in comparison to the abovementioned requirements the following differences applied 
business combinations were accounted for using the purchase method transaction costs directly attributable to the acquisition formed part 
of the acquisition costs the noncontrolling interest formerly known as minority interest was measured at the proportionate share of the 
acquiree’s identifiable net assets business combinations achieved in stages were accounted for as separate steps any additional acquired 
share of interest did not affect previously recognised goodwill 
when the group acquired a business embedded derivatives separated from the host contract by the acquiree were not reassessed on 
acquisition unless the business combination resulted in a change in the terms of the contract that significantly modified the cash flows that 
otherwise would have been required under the contract 
contingent consideration was recognised if and only if the group had a present obligation the economic outflow was more likely than not 
and a reliable estimate was determinable subsequent adjustments to the contingent consideration were recognised as part of goodwill 
f investment in an associate 
the group’s investment in its associate is accounted for using the equity method an associate is an entity in which the group has significant 
influence under the equity method the investment in the associate is carried in the balance sheet at cost plus post acquisition changes in the 
group’s share of net assets of the associate goodwill relating to the associate is included in the carrying amount of the investment and is 
neither amortised nor individually tested for impairment 
the income statement reflects the share of the results of operations of the associate where there has been a change recognised directly in  
the equity of the associate the group recognises its share of any changes and discloses this when applicable in the statement of changes  
in equity unrealised gains and losses resulting from transactions between the group and the associate are eliminated to the extent of the 
interest in the associate 
the share of profit of an associate is shown on the face of the income statement this is the profit attributable to equity holders of the 
associate and therefore is profit after tax and noncontrolling interests in the subsidiaries of the associate  
the financial statements of the associate are prepared for the same reporting period as the group where necessary adjustments are made  
to bring the accounting policies in line with those of the group 
g jointly controlled entities 
the group has an interest in joint ventures which are jointly controlled entities whereby the venturers have a contractual arrangement that 
establishes joint control over the economic activities of the entity the agreement requires unanimous agreement for financial and operating 
decisions among the venturers the group recognises its interest in the joint venture using the proportionate consolidation method the 
group combines its proportionate share of each of the assets liabilities income and expenses of the joint venture with similar items line by 
line in its consolidated financial statements the financial statements of the joint venture are prepared for the same reporting period as the 
group adjustments are made where necessary to bring the accounting policies in line with those of the group 
adjustments are made in the group’s consolidated financial statements to eliminate the group’s share of intragroup balances transactions 
and unrealised gains and losses on such transactions between the group and its jointly controlled entity losses on transactions are 
recognised immediately if the loss provides evidence of a reduction in the net realisable value of current assets or an impairment loss  
the joint venture is proportionately consolidated until the date on which the group ceases to have joint control over the joint venture  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   55 
note 2 summary of significant accounting policies continued 
h foreign currency translation 
the functional currency of the company is the great british pound the consolidated financial statements are presented in euro as a 
significant portion of the group’s operations are conducted in euro 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 exchange rates prevailing on the dates of the transactions monetary assets and 
liabilities denominated in foreign currencies are retranslated into functional currency 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 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 equity items are translated at the historic 
exchange rates exchange differences arising on the translation are classified as a separate component of equity foreign currency translation 
reserve such translation differences are recognised in the income statement 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 
exchange differences in respect of loans denominated in euro which were granted by the company to its subsidiaries are reflected in the 
foreign currency translation reserve in equity 
the following exchange rates in relation to the euro were prevailing at balance sheet dates 
 as at 31 december 
 
2010  
in euro 
2009  
in euro 
great british pound 1161 1127 
hungarian forint 0004 0004 
 percentages increase decrease in exchange rates during the year 
 as at 31 december 
 
2010  
 
2009  
 
great british pound 30 75 
hungarian forint – – 
i 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 valued at the 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 straightline 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 are 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  
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 the income statement when the asset is derecognised  
j property plant and equipment 
property plant and equipment are measured at cost less accumulated depreciation and impairment losses depreciation is calculated using 
the straightline method over the shorter of the estimated useful life of the assets or the lease term as follows 
 years 
land under finance lease 121 – 125 
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  
an item of property plant and equipment and any significant part initially recognised is derecognised upon disposal or when no future 
economic benefits are expected from its use or disposal any gain or loss arising on derecognition of the asset calculated as the difference 
between the net disposal proceeds and the carrying amount of the asset is included in the income statement when the asset is derecognised 
the assets’ residual values useful lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively if 
appropriate 
the company distinguishes between sold and unsold aparthotel units unsold units are depreciated using the straightline methods as 
mentioned above aparthotel units which have been sold to individual purchasers are subject to a depreciation charge of zero as their 
residual value will be equal to their carrying amount  notes to consolidated financial statements continued 
56   park plaza hotels annual report 2010 
note 2 summary of significant accounting policies continued 
j property plant and equipment continued 
aparthotel units sold to purchasers will only be derecognised when significant risks and rewards of ownership of and control over the 
relevant units have passed to the purchasers 
 significant judgements applied determining accounting policy 
in light of the complexity of the park plaza westminster bridge “westminster bridge hotel” project a number of significant judgements have 
been made by the board in consultation with and upon the recommendation of management in determining the accounting policies around 
the derecognition of the units sold to buyers and the recognition of resultant revenues 
these significant judgements relate to the timing of when substantially all the significant risk and rewarded of ownership of the units and 
continuing managerial involvement are deemed to have been ceded by the group 
because of the complexity of the project and the potential for evolution of accounting guidance of the subject the board and management 
will continue to reevaluate the relevant judgements on an ongoing basis 
k impairment of nonfinancial assets 
at each reporting date the group reviews the carrying amounts of its nonfinancial 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 cashgenerating 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 pretax 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 cashgenerating unit is estimated to be less than its carrying amount the asset is considered 
impaired and the carrying amount of the asset cashgenerating 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 cashgenerating 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 cashgenerating unit a reversal of an impairment loss is recognised as income immediately 
l financial instruments 
financial assets within the scope of ias 39 are initially recognised at fair value plus directly attributable transaction costs except for 
investments at fair value through profit or loss in respect of which transaction costs are carried to the income statement 
after initial recognition the accounting treatment of investments in financial assets is based on their classification into one of the following 
categories 
 1 loans and receivables 
the group has loans and receivables that are financial assets nonderivative with fixed or determinable payments that are not quoted in 
an active market after initial recognition loans and receivables are measured at amortised cost using the effective interest method taking 
into account transaction costs and less any allowance for impairment gains and losses are recognised in the income statement when the 
loans and receivables are derecognised or impaired as well as through the systematic amortisation process 
 2 availableforsale financial assets 
the group has availableforsale financial assets that are financial assets nonderivative that are designated as availableforsale or are 
not classified in the preceding categories after initial recognition availableforsale financial assets are measured at fair value gains or 
losses from fair value adjustments are recognised directly in other comprehensive income in the net unrealised gains reserve when the 
investment is disposed of or in case of impairment the cumulative gain or loss previously recorded in equity is recognised in the statement 
of income interest income on investments in debt instruments is recognised in the income statement using the effective interest method 
dividends earned on investments are recognised in the statement of income when the right of payment has been established 
 3 fair value 
the fair value of investments that are actively traded in organised financial markets is determined by reference to market prices on the 
balance sheet date for investments where there is no active market fair value is determined using valuation techniques such techniques 
include using recent arm’s length market transactions reference to the current market value of another instrument which is substantially 
the same discounted cash flow or other valuation models 
 4 financial liabilities 
interestbearing loans and borrowings are initially recognised at fair value plus directly attributable transaction costs after initial 
recognition interestbearing loans and borrowings are measured at amortised cost using the effective interest method which also 
accounts for directly attributable transaction costs gains and losses are recognised in the income statement when the loan is 
derecognised as well as through the systematic amortisation process  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   57 
note 2 summary of significant accounting policies continued 
 5 derecognition of financial instruments 
 financial assets 
a financial asset is derecognised when the contractual rights to the cash flows from the financial asset expire or the group has transferred 
its contractual rights to receive cash flows from the financial asset or assumes an obligation to pay the cash flows in full without material 
delay to a third party and has transferred substantially all the risks and rewards of the asset or has neither transferred nor retained 
substantially all the risks and rewards of the asset but has transferred control of the asset 
 financial liabilities 
a financial liability is derecognised when it is extinguished ie when the obligation is discharged or cancelled or expires a financial 
liability is extinguished when the debtor the group discharges the liability by paying in cash other financial assets goods or services  
or is legally released from the liability 
where an existing financial liability is exchanged with another liability from the same lender on substantially different terms or the terms 
of an existing liability are substantially modified such an exchange or modification is accounted for as an extinguishment of the original 
liability and the recognition of a new liability and the difference in the respective carrying amounts is recognised in the income statement  
 6 financial guarantee contracts 
financial guarantee contracts issued by the group are those contracts that require a payment to be made to reimburse the holder for a 
loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument financial 
guarantee contracts are recognised initially as a liability at fair value adjusted for transaction costs that are directly attributable to the 
issuance of the guarantee subsequently the liability is measured at the higher of the best estimate of the expenditure required to settle 
the present obligation at the balance sheet date and the amount initially recognised less cumulative amortisation 
 7 impairment of financial assets 
the group assesses at each balance sheet date whether the following financial asset or group of financial assets is impaired as follows 
• assets carried at amortised cost 
evidence of impairment may include indications that the debtors are experiencing significant financial difficulty default or 
delinquency in interest or principal payments or other observable data of a measurable decrease in the estimated future cash flows  
if there is objective evidence that an impairment loss on loans and receivables and heldtomaturity investments carried at amortised 
cost has been incurred the amount of the loss carried to the income statement is measured as the difference between the asset’s 
carrying amount and the present value of estimated future cash flows excluding future credit losses that have not been incurred 
discounted at the financial asset’s original effective interest rate in a subsequent period the amount of the impairment loss is 
reversed if the recovery of the asset can be related objectively to an event occurring after the impairment was recognised the amount 
of the reversal as above is credited to the income statement up to the amount of any previous impairment  
• availableforsale financial assets 
in the case of equity investments classified as availableforsale evidence of impairment would include a significant or prolonged 
decline in the fair value of the investment below its cost where there is evidence of impairment the cumulative loss measured as the 
difference between the acquisition cost less any previous impairment losses and the current fair value is removed from equity and 
recognised in the income statement in subsequent periods any reversal of impairment loss is not carried to the statement of income 
but recognised as other comprehensive income  
m 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 basis  
net realisable value is the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale 
n inventories under construction 
inventories under construction are measured at the lower of cost and net realisable value cost of inventories includes direct identifiable 
construction costs indirect costs and capitalised borrowing costs net realisable value is the estimated selling price in the ordinary course  
of business less the estimated costs of completion 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 shortterm deposits with an original maturity of three months or less 
p derivative financial instruments and hedge accounting 
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 measured again 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 the income 
statement 
the fair value of interest rate swap contracts is determined using valuation techniques including the discounted cash flow model 
for the purpose of hedge accounting hedges are classified as cash flow hedges when hedging the exposure to variability in cash flows that  
is either attributable to a particular risk associated with a recognised asset or liability or a highly probable forecast transaction  notes to consolidated financial statements continued 
58   park plaza hotels annual report 2010 
note 2 summary of significant accounting policies continued 
p derivative financial instruments and hedge accounting continued 
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 other comprehensive income while the ineffective 
portion is recognised in profit or loss amounts taken to other comprehensive income are transferred to the income statement when the 
hedged transaction affects profit or loss such as when the 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 revenue recognition 
revenue is recognised to the extent that it is probable that the economic benefits will flow to the group and the revenue can be reliably 
measured regardless of when the payment is being made revenue is measured at the fair value of the consideration received or receivable 
taking into account contractually defined terms of payment and excluding taxes or duty the group assesses its revenue arrangements against 
specific criteria in order to determine if it is acting as principal or agent the group has concluded that it is acting as a principal in all of its 
revenue arrangements the following specific recognition criteria must also be met before revenue is recognised 
owned and leased hotels 
primarily derived from hotel operations including the rental of rooms food and beverage sales and other services from owned and leased 
hotels operated under the group’s brand names revenue is recognised when rooms are occupied food and beverages are sold and services 
are performed 
sale of aparthotel units 
revenue from the sale of aparthotel units is recognised when the significant risks and rewards of ownership and control have been passed  
to the buyer 
management fees 
earned from hotels managed by the group under longterm contracts with the hotel owner management fees include a base fee which is 
generally a percentage of hotel revenue and an incentive fee which is based on the hotel’s profitability revenue is recognised when earned 
and realised or realisable under the terms of the agreement 
franchise fees 
received in connection with a license of the group’s brand names under longterm contracts with the hotel owner the group charges 
franchise royalty fees as a percentage of hotel revenue revenue is recognised when earned and realised or realisable under the terms of  
the agreement 
ebitdar 
earnings before interest tax depreciation amortisation impairment loss and rental expenses and share of associate and tax ebitdar 
correspond to revenue less cost of revenues operating expenses ebitdar together with ebitda is used as a key management indicator  
ebitda 
earnings before interest tax depreciation and amortisation and impairment loss ebitda correspond to gross profit after the operating 
costs of holding leased hotels 
ebit  
earnings before interest and tax ebit correspond to gross operating profit after the operating costs of holding both leased and owned assets  
s 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 straightline basis over the term of the relevant lease 
the group as lessee 
finance leases which transfer to the group substantially all the risks and benefits incidental to ownership of the leased item are capitalised at 
the commencement of the lease at the fair value of the leased property or if lower at the present value of the minimum lease payments  
lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the 
remaining balance of the liability finance charges are recognised in the income statement 
leased assets are depreciated over the useful life of the asset however if there is no reasonable certainty that the group will obtain 
ownership by the end of the lease term the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term 
operating lease payments are recognised as an expense in the income statement on a straightline basis over the term of the lease  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   59 
note 2 summary of significant accounting policies continued 
s leases continued 
prepaid leasehold payments 
prepaid leasehold payments are upfront payments to acquire a longterm leasehold interest in land and building these payments are stated 
at cost and are amortised on a straightline basis over the respective period of the leases 50 years 
t employee benefits 
sharebased payments 
the board has adopted a “share option plan” under which employees and directors of the company and its subsidiaries receive 
remuneration in the form of sharebased payment transactions whereby employees render services as consideration for equity instruments 
equity settled transactions  
the cost of equitysettled transactions with employees is measured by reference to the fair value at the date on which they are granted  
the fair value is determined by using an appropriate pricing model further details of which are given in note 16 
the cost of equitysettled transactions is recognised together with a corresponding increase in equity over the period in which the 
performance andor service conditions are fulfilled the cumulative expense recognised for equitysettled 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 of the number of equity 
instruments that will ultimately vest the income statement expense or credit for a period represents the movement in cumulative expense 
recognised as at the beginning and end of that period 
no expense is recognised for awards that do not ultimately vest except for equitysettled transactions where vesting is conditional upon a 
market or nonvesting condition which are treated as vesting irrespective of whether or not the market or nonvesting condition is satisfied 
provided that all other performance andor service conditions are satisfied 
where the terms of an equitysettled transaction award are modified the minimum expense recognised is the expense as if the terms had not 
been modified if the original terms of the award are met an additional expense is recognised for any modification that increases the total fair 
value of the sharebased payment transaction or is otherwise beneficial to the employee as measured at the date of modification 
where an equitysettled award is cancelled it is treated as if it vested on the date of cancellation and any expense not yet recognised for the 
award is recognised immediately this includes any award where nonvesting conditions within the control of either the entity or the employee 
are not met however if a new award is substituted for the cancelled award and designated as a replacement award on the date that it is 
granted the cancelled and new awards are treated as if they were a modification of the original award as described in the previous 
paragraph all cancellations of equitysettled transaction awards are treated equally 
pension 
the group has a defined contribution pension plan where the employer is liable only for the employer’s part of the contribution towards the 
individual’s pension plans 
the group will have no legal obligation to pay further contribution the contributions in the defined contribution plan are recognised as an 
expense and no additional provision is required in the financial statements 
u borrowing costs for qualifying assets 
borrowing costs directly attributable to the acquisition construction or production of qualifying assets are capitalised 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 
v 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 carryforward 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 carryforward 
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  notes to consolidated financial statements continued 
60   park plaza hotels annual report 2010 
note 2 summary of significant accounting policies continued 
v taxation continued 
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 tax assets and liabilities are measured at the tax rates that are expected to apply in 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 tax assets and liabilities and changes in them relating to items recognised directly in equity are recognised in equity and not in the 
income statement 
deferred 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 
w treasury shares 
company shares held by the company are recognised at cost and presented as a deduction from equity any purchase sale issue or 
cancellation of treasury shares is recognised directly in equity 
x earnings loss per share 
basic earnings loss per share amounts are calculated by dividing the net profit loss for the year by the weighted average number of 
ordinary shares outstanding during the year 
diluted earnings loss per share amounts are calculated by dividing the net profit loss 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 operating cycle 
the normal operating cycle of marlbray was greater than one year due to the operating cycle of the project under construction  
as a result current assets and liabilities include items the realisation of which is intended and anticipated to take place over marlbray’s 
normal operating cycle 
z standards issued but not yet applied  
 ifrs 9 – financial instruments 
in november 2009 the iasb issued the first part of phase i of ifrs 9 “financial instruments” as part of a project to replace ias 39 
“financial instruments recognition and measurement” ifrs 9 focuses mainly on the classification and measurement of financial assets and 
it applies to all financial assets within the scope of ias 39 
according to ifrs 9 upon initial recognition all the financial assets including hybrid contracts with financial asset hosts will be measured  
at fair value in subsequent periods debt instruments can be measured at amortized cost if both of the following conditions are met 
• the asset is held within a business model whose objective is to hold assets in order to collect the contractual cash flows 
• the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on 
the principal amount outstanding 
notwithstanding the aforesaid upon initial recognition a company may designate a debt instrument that meets both of the abovementioned 
conditions to fair value through profit or loss if this designation eliminates or significantly reduces a measurement or recognition 
inconsistency “accounting mismatch” that would have otherwise arisen 
subsequent measurement of all other debt instruments and financial assets will be at fair value 
financial assets that are equity instruments will be measured in subsequent periods at fair value and the changes will be recognized in profit or 
loss or in other comprehensive income loss in accordance with the election of the accounting policy on an instrumentbyinstrument basis 
amounts recognised in other comprehensive income will not be later classified to profit or loss nevertheless if the equity instruments are 
held for trading they must be measured at fair value through profit or loss this election is final and irrevocable when an entity changes its 
business model for managing financial assets it shall reclassify all affected financial assets in all other circumstances reclassification of 
financial instruments is not permitted 
the standard will be effective starting 1 january 2013 earlier application is permitted early adoption will be done with a retrospective 
restatement of comparative figures subject to the relief set out in the standard  
in october 2010 the iasb issued certain amendments to ifrs 9 regarding derecognition and financial liabilities according to those 
amendments the provisions of ias 39 will continue to apply to derecognition and financial liabilities which are not measured at fair value 
through profit or loss namely the classification and measurement provisions of ias 39 will continue to apply to financial liabilities held for 
trading and financial liabilities measured at amortized cost 
the adjustments arising from these amendments affect the measurement of a liability at fair value whereby the amount of the adjustment to 
the liability’s fair value – attributed to changes in credit risk – will be carried to other comprehensive income all other fair value adjustments 
will be carried to the statement of income if carrying the fair value adjustment of the liability arising from changes in the credit risk to other 
comprehensive income creates an accounting mismatch in the income statement then that adjustment also will be carried to the income 
statement rather than to other comprehensive income 
furthermore according to the amendments liabilities in respect of certain unquoted equity instrument derivatives can no longer be measured 
at cost but rather only at fair value  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   61 
note 2 summary of significant accounting policies continued 
z standards issued but not yet applied continued  
the amendments will be effective starting 1 january 2013 earlier application is permitted provided that the company also adopts the 
provisions of ifrs 9 regarding the classification and measurement of financial assets the asset stage firsttime adoption of these 
amendments will be done retrospectively by restating comparative data subject to the exemptions provided by the amendments 
ias 12 – income taxes 
the amendment to ias 12 deals with the recognition of deferred taxes for investment property measured at fair value according to the 
amendment the deferred taxes in respect of temporary difference for such assets should be measured based on the presumption that the 
temporary difference will be utilised in full through sale rather than through continuing use this presumption is rebuttable if the investment 
property is depreciable for tax purposes and is held within the company’s business model with the purpose of recovering substantially all of 
the underlying economic benefits by way of use and not sale in those cases the other general provisions of ias 12 would apply in respect of 
the manner of utilisation that is most expected  
the amendment supersedes the provisions of sic 21 that require distinguishing between the land component and the building component  
of investment property measured at fair value in order to calculate the deferred tax according to their manner of expected utilisation 
the amendment will be adopted retrospectively starting from the financial statements for annual periods commencing on 1 january 2012  
this amendment will not have any influence on the group 
ifric 19 – extinguishing financial liabilities with equity instruments 
in november 2009 ifric 19 “the interpretation” was published stipulating the accounting treatment of transactions where financial 
liabilities are discharged by issuing equity instruments pursuant to the interpretation equity instruments issued to replace debt shall be 
measured at fair value of the equity instruments issued if this may be reliably measured if the fair value of equity instruments issued may  
not be reliably measured then the equity instruments should be measured at fair value of the financial liability discharged upon the date of 
discharge the difference between the balance of the discharged liability on the financial statements and the fair value of equity instruments 
issued is recognised on the income statement 
the interpretation should be applied to annual reporting periods starting on or after 1 january 2011 
ifrs 7 – financial instruments disclosure 
the amendment to ifrs 7 clarifies the disclosure requirements prescribed by the standard the standard highlights the connection between 
the quantitative and qualitative disclosures and the nature and scope of the risks arising from financial instruments the disclosure 
requirements regarding securities held by the company have been minimised and the disclosure requirements regarding credit risk have been 
revised the amendment will be adopted retrospectively in the financial statements for periods starting from 1 january 2011 
ias 24 related party disclosures amendment 
the amended standard is effective for annual periods beginning on or after 1 january 2011 it clarified the definition of a related party to 
simplify the identification of such relationships and to eliminate inconsistencies in its application the revised standard introduces a partial 
exemption of disclosure requirements for government related entities the group does not expect any impact on its financial position or 
performance early adoption is permitted for either the partial exemption for governmentrelated entities or for the entire standard 
ias 32 financial instruments presentation – classification of rights issues amendment 
the amendment to ias 32 is effective for annual periods beginning on or after 1 february 2010 and amended the definition of a financial 
liability in order to classify rights issues and certain options or warrants as equity instruments in cases where such rights are given pro rata  
to all of the existing owners of the same class of an entity’s nonderivative equity instruments or to acquire a fixed number of the entity’s own 
equity instruments for a fixed amount in any currency this amendment will have no impact on the group after initial application  
ifric 14 prepayments of a minimum funding requirement amendment 
the amendment to ifric 14 is effective for annual periods beginning on or after 1 january 2011 with retrospective application the 
amendment provides guidance on assessing the recoverable amount of a net pension asset the amendment permits an entity to treat the 
prepayment of a minimum funding requirement as an asset the amendment is deemed to have no impact on the financial statements of  
the group 
  notes to consolidated financial statements continued 
62   park plaza hotels annual report 2010 
note 3 business combinations  
a on 28 april 2010 the group acquired a large conference hotels in the netherlands located near amsterdam schiphol airport the hotel was 
acquired for approximately €20 million attributable to the group €10 million from melbourne onroerende zaken bv  
and is owned through schiphol victoria hotel cv a joint venture controlled 5050 by the company and elbit imaging ltd “elbit”  
the company and elbit each contributed equity of approximately €10 million as consideration for the acquisition the hotel formerly 
operated as the ‘holiday inn amsterdam schiphol’ opened in 2007 given its close proximity to amsterdam schiphol airport the hotel  
was rebranded as park plaza amsterdam airport “schiphol hotel”  
the fair value of the identifiable assets and liabilities as at the date of acquisition and the corresponding carrying amount immediately before 
is presented below 
 
fair value 
recognised 
on acquisition 
€’000 
previous carrying 
amount 
€’000 
property plant and equipment 15308 15293 
trade receivables 350 350 
cash and cash equivalent 261 261 
other current assets  43 43 
 15962 15947 
trade creditors 142 142 
longterm loans 14000 14000 
other current payables and accruals 394 394 
 14536 14536 
net assets acquired 1426 1411 
negative goodwill 308  
total consideration 1118  
 
cash flow on acquisition  €’000 
net cash acquired with the subsidiary 261 
cash paid 1000 
net cash outflow 739 
 the fair value of the property plant and equipment was evaluated by bdo ziv haft using the dcf approach of discounted forecasted cash 
flows the fair value estimate is based on 
• a discount rate and a terminal rate value of 8 
• cash flow forecast based on the group’s budgets and based on rebranding the hotel as schiphol hotel 
• a reinvestment of 35 of total revenue of the hotel 
from the date of acquisition schiphol has contributed €24 million and a loss of €01 million to the net profit before tax of the group  
if the combination had taken place at the beginning of the year schiphol hotel would have contributed €41 million of revenue and a loss  
of €08 million to the net profit before tax of the group 
transaction costs due to this transaction were not material 
the negative goodwill is an outcome of the benefit that the company sees from adding schiphol hotel to the group’s portfolio as a result  
of a bargain purchase 
the acquisition was financed via an increase to the existing facility with aareal bank ag “aareal” the enlarged facility the maturity of 
which has been extended to 27 april 2017 has a value of €1110 million attributable to the group €570 million and includes €280 million 
attributable to the group €140 million for the purchase and €50 million for renovations and updates to schiphol hotel and certain of the 
other group’s hotels for further information on the loan see note 17 a2 
b on 4 august 2010 the company acquired through its whollyowned subsidiary euro sea hotels nv “euro sea” the entire issued share 
capital of each of hotel leeds holding bv “leeds” hotel nottingham holding bv “nottingham” and nottingham park plaza hotel 
operator limited “npphol” from leno hotel holding bv “leno” a whollyowned member of the red sea group the controlling 
shareholder for an aggregate cash consideration of £33 million €40 million 
the company also acquired leno investment limited “leno investment” a whollyowned subsidiary of leno for £1 prior to its acquisition 
by euro sea leno investment acquired certain bank loans owed by leeds and nottingham “the loans” for a total consideration of  
£5 million €60 million which represented a substantial discount to the book value of the loans of the consideration £2 million €24 
million was paid on completion of the acquisition of the loans the “initial consideration” and the remaining £3 million €36 million has 
been deferred on a stepped interest bearing mechanism of libor6 on the first year libor8 on the second year and libor10 on the 
third year the amount is due no later than three years from the date of acquisition the principal balance of £3 million €36 million 
repayment of which is guaranteed by euro sea will become repayable earlier on the occurrence of certain events including a disposal of either 
of the hotels or any dilution of the group’s interest in leno investment in addition if there is a sale or other disposal of the leasehold 
interests in either or both of the hotels at any time during the twoyear period ending 3 august 2012 for an aggregate consideration in excess 
of £25 million €303 million leno investment will be required to pay further consideration to the original lender equal to 50 of the excess 
as the company presently has no intention of disposing of the interest in these hotels no account has been taken in respect of this contingent 
liability euro sea provided leno investment with the necessary funds to meet the payment of the initial consideration for the loans and has 
agreed to finance the deferred consideration payable when it becomes due   notes to consolidated financial statements continued 
park plaza hotels annual report 2010   63 
note 3 business combinations continued 
management fees of £ 33 million €40 million owed by npphol to park plaza hotels europe bv “pphe” were paid in full prior to the 
acquisition of npphol by euro sea 
as part of the transaction the company has also acquired the entire issued share capital of waterford investments limited “waterford” from 
julian donn for £1 waterford’s principal assets are 
i the freehold of the park plaza leeds hotel “leeds hotel” held through waterford’s whollyowned subsidiary laguna estates leeds 
limited “laguna” 
ii a long lease of the main site of the nottingham hotel which runs until 2145 held through waterford’s whollyowned subsidiary katmandu 
limited “katmandu” and  
iii a long lease of land for storage use adjoining the park plaza nottingham hotel “nottingham hotel” which runs until 2061 held through 
katmandu  
laguna has a term facility from the royal bank of scotland plc prior to completion of the acquisition of waterford the company provided 
laguna with funds to enable it to reduce the amount outstanding under this facility by £13 million €15 million which was a condition of the 
bank’s consent to the change of control of waterford immediately following such repayment approximately £136 million €158 million  
was outstanding of which £113 million €137 million carries a variable interest of three month libor plus 13 per annum and £23 million  
€28 million carries a variable interest of three month libor plus 17 per annum the facility is repayable in 2019 laguna entered into a swap 
agreement to fix the variable interest to an interest rate of 51 for further information see note 31 3 
katmandu has a term facility from national westminster bank plc under which approximately £59 million €72 million was outstanding  
on acquisition the loan carries a variable interest of three month libor plus 13 per annum and is repayable in 2027 katmandu entered into  
a swap agreement to fix the variable interest to an interest rate of 55 for further information see note 31 3 
as part of the acquisition of waterford the company’s whollyowned subsidiary park plaza hotels europe holdings bv “ppheh” acquired 
from martin morris a deep discount bond for a cash consideration of £20 million €24 million  
as a result of these transactions leeds hotel and nottingham hotel are now fullyowned as well as operated by the group this will facilitate the 
planned refurbishment of the two hotels 
the fair value of the identifiable assets and liabilities as at the date of acquisition and the corresponding carrying amount immediately before is 
presented below 
 
fair value  
recognised 
on acquisition 
€’000 
 previous  
carrying  
amount  
€’000 
property plant and equipment 40316 55934 
trade receivables 402 402 
cash and cash equivalent 757 757 
other current assets  459 459 
 41934 57552 
longterm loans 22782 27473 
other longterm liabilities 4691 4691 
trade creditors 648 648 
other currency payables and accruals 1681 1681 
 29802 34493 
net assets acquired 12132 23059 
negative goodwill 1756  
total consideration 10376  
 
cash flow on acquisition  €’000 
net cash acquired with the subsidiary 757 
cash paid 10376 
net cash outflow 9619 
  notes to consolidated financial statements continued 
64   park plaza hotels annual report 2010 
note 3 business combinations continued 
the fair value of the property plant and equipment was evaluated by bdo israel using the dcf approach of discounted forecasted cash flows 
the fair value estimate is based on 
• a discount rate and a terminal value of 8 
• cash flow forecast based on the group’s budgets 
• a reinvestment of 35 of total revenue of the hotel and have additional future refurbishment of total £15 million €17 million in 2012 
from the date of acquisition leeds hotel and nottingham hotel has contributed €47 million and a loss of €05 million to the net profit before 
tax of the group if the combination had taken place at the beginning of the year leeds hotel and nottingham hotel would have contributed 
€109 million of revenue and a loss of €21 million to the net profit before tax of the group 
transaction costs due to this transaction were not material  
the negative goodwill is an outcome of the benefit that the company sees from adding leeds hotel and nottingham hotel to the group’s 
portfolio as a result of a bargain purchase 
c on 31 december 2010 “the closing date” the company acquired from elbit through ppheh the entire issued share capital of each of the 
holding companies of park plaza sherlock holmes hotel “sherlock holmes hotel” park plaza victoria london hotel “victoria london 
hotel” park plaza riverbank london including plaza on the river “riverbank hotel” which the group did not already own prior to the 
acquisition the group owned 50 of victoria london hotel and 55 of sherlock holmes hotel and riverbank hotel the total nominal 
consideration for the acquisition was £210 million €244 million subject to the adjustments as described below 
• the euro equivalent of £8 million €93 million as at completion to be paid by the group in 7 equal quarterly instalments with 
interest of 7 per annum payable quarterly the first instalment was payable at completion of the acquisition 
• the euro equivalent of £8 million €93 million as at completion to be paid by the group in december 2013 with interest of 7 per 
annum payable quarterly 
• £15 million €17 million by the issue of 1000000 of the company’s shares “the consideration shares” elbit is subject to a lock
up until the first anniversary of completion following which the company will have a right of first refusal in respect of the 
consideration shares and  
£35 million €41 million to be paid as to £18 million €20 million in december 2015 £09 million €10 million in december 2016 
and £09 million €10 million in december 2017 this amount may be reduced depending on the performance of the company’s shares 
during the fiveyear period following completion and should be paid as follows £18 million €20 million on december 2015 
“settlement date” the remaining amount is paid in two equal instalments on the sixth anniversary december 2016 and seventh 
anniversary december 2017 of the closing date the amount is adjusted as follow  
a if at the settlement date the average share price of the company over the last 60 business days is higher than £5 the remaining 
cash payment is cancelled  
b if at the settlement date the average share price of the company over the last 60 business days is lower than £5 but higher than 
£150 the remaining cash payment will be reduced by the difference between the share price and £15 multiplied by the amount of 
shares issued to elbit 10 million  
c if at the settlement date the average share price of the company over the last 60 business days is lower than £150 the remaining 
cash payment is £35 million €41 million  
the company has been granted the option to buy back all of the consideration shares which elbit may own from time to time at a price 
of £5 per share if this option were exercised the balance of the £35 million €41 million under c above will be reduced by an 
amount equal to £35 multiplied by the number of shares actually purchased any such exercise would require shareholders’ approval 
under guernsey law 
all amounts due to elbit are fully guaranteed by the company 
as the company achieved control over these hotels which were previously under joint control the transaction is accounted for as a business 
combination achieved in stages “step acquisition” accordingly management remeasured the companies’ previously held equity interests in 
these hotels at the acquisition date at fair value and recognised a gain of €508 million including reclassification adjustment of foreign currency 
translation reserve of €94 million 
following the purchase acquisition loans amounting to a total of £301 million €349 million given from elbit to the purchased companies were 
assigned to ppheh  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   65 
note 3 business combinations continued 
the fair value of the identifiable assets and liabilities as at the date of acquisition and the corresponding carrying amount immediately before is 
presented below 
 
fair value 
recognised on 
acquisition 
€’000 
previous  
carrying  
amount 
€’000 
property plant and equipment 173728 92705 
trade receivables 1374 1374 
cash and cash equivalent 4282 4282 
other current assets  4603 6419 
 183987 104780 
longterm loans 86756 86756 
other noncurrent liabilities 8634 8634 
trade creditors 2018 2018 
shortterm loans 1306 1306 
other current payables and accruals 12613 12613 
 111327 111327 
net assets acquired 72660 6547 
negative goodwill 7933  
capital gain from obtaining control in a former jointly controlled entity 41435  
total consideration 23292  
 
cash flow on acquisition  €’000 
net cash acquired with the subsidiary 4282 
cash paid 1337 
net cash outflow 2945 
the fair value of the property plant and equipment was evaluated by savills using the dcf approach of discounted forecasted cash flows the fair 
value estimate is based on 
• a discount rate of 1075 for sherlock holmes hotel and 875 for victoria london hotel and riverbank hotel 
• a terminal value of 823 for sherlock holmes hotel and 625 for victoria london hotel and riverbank hotel calculated based on long
term sustainable growth rates for the industry ranging from 254 which has been used to determine income in the future years 
• cash flow forecast based on the group’s budgets 
• a reinvestment of 35 of total revenue of the hotel  
from the date of acquisition sherlock holmes hotel victoria london hotel and riverbank hotel have no contribution to the group’s results  
if the combination had taken place at the beginning of the year sherlock holmes hotel victoria london hotel and riverbank hotel would have 
contributed €265 million and a loss of €185 million to the net profit before tax of the group 
transaction costs due to this transaction were not material 
for additional information provided in connection with the three years’ performance and the financial position of the acquired jointly controlled 
entities please refer to appendix c   notes to consolidated financial statements continued 
66   park plaza hotels annual report 2010 
note 4 intangible assets 
 
park plaza
®
 
hotels  
 resorts 
management 
and franchise 
rights a 
 €’000 
art’otel
®
  
rights b  
€’000 
total 
€’000
cost    
balance as at 1 january 2009 48404 4000 52404 
balance as at 31 december 2009 48404 4000 52404 
accumulated amortisation    
balance as at 1 january 2009 3630 1327 4957 
amortisation 2421 144 2565 
balance as at 31 december 2009 6051 1471 7522 
amortised cost as at 31 december 2009 42353 2529 44882 
cost    
balance as at 1 january 2010 48404 4000 52404 
balance as at 31 december 2010 48404 4000 52404 
accumulated amortisation    
balance as at 1 january 2010 6051 1471 7522 
amortisation 2420 149 2569 
balance as at 31 december 2010 8471 1620 10091 
amortised cost as at 31 december 2010 39933 2380 42313 
a acquisition of park plaza
®
 hotels  resorts management and franchise rights 
1 management rights – rights held by the group relating to the management of park plaza
®
 hotels  resorts in europe the middle east 
and africa the management rights are included in the consolidated financial statements at their fair value as at the date of acquisition 
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 the remaining amortisation period is 165 years 
2 franchise rights – relating to the brand “park plaza
®
 hotels  resorts” are included in the consolidated financial statements at their fair 
value as at the date of acquisition and are being amortised over 20 years based on management’s estimation of their useful life the 
remaining amortisation period is 165 years 
b acquisition of art’otel
®
 rights 
the company acquired in july 2007 the worldwide rights to use the art’otel
®
 brand name for an unlimited period of time the rights are being 
amortised over 20 years based on management’s estimation of their useful life the remaining amortisation period is 165 years 
c impairment testing of intangible assets 
the recoverable amounts of the intangible assets have been determined in 2010 by internal value in use calculations using discounted cash 
flow projections for the relevant cash generating units from financial budgets approved by senior management covering a fiveyear period 
the pretax discount rate applied to cash flow projections is 95 2009 95 and cash flows beyond the fiveyear period are extrapolated 
using a 1 2009 25 growth rate based on these calculations the carrying amounts of the intangible assets do not exceed their 
recoverable amounts  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   67 
note 5 property plant and equipment 
 
land
€’000
hotel buildings 
€’000 
furniture and 
equipment 
€’000 
total 
€’000 
balance as at 1 january 2009 60511 111483 41897 213891 
 additions during the year 944 1186 1215 3345 
 disposals – – 340 340 
 adjustment for exchange rate differences  2982 4132 2179 9293 
balance as at 31 december 2009 64437 116801 44951 226189 
accumulated depreciation     
balance as at 1 january 2009 1217 10511 18241 29969 
 adjustment for exchange rate differences  84 240 965 1289 
 disposals – – 195 195 
 provision for depreciation 241 1387 4873 6501 
balance as at 31 december 2009 1542 12138 23884 37564 
depreciated cost as at 31 december 2009 62895 104663 21067 188625 
cost     
balance as at 1 january 2010 64437 116801 44951 226189 
 acquisition of a subsidiary 92617 132131 4604 229352 
 additions during the year 715 15417 21050 37182 
 reclassification from inventories under construction 22395 132727 5338 160460 
 disposals – – 45 45 
 adjustment for exchange rate differences  101 484 708 123 
balance as at 31 december 2010 180063 396592 76606 65321 
accumulated depreciation     
 balance as at 1 january 2010 1542 12138 23884 37564 
 disposals   30 30 
 provision for depreciation 253 3474 6104 9831 
 adjustment for exchange rate differences 41 101 512 654 
balance as at 31 december 2010 1836 15713 30470 48019 
depreciated cost as at 31 december 2010 178227 380879 46136 605242 
1 the recoverable amount of property plant and equipment has been determined based on external and internal valueinuse calculations using 
discounted cash flow projections for the relevant cashgenerating units these projections are based on financial budgets approved by senior 
management covering a fiveyear period the pretax discount rate applied to cash flow projections is 911 2009 95115 and cash 
flows beyond the fiveyear period are extrapolated using a growth rate of 225 2009 2025 no impairment indications came out  
of this valuation  
 
 31 december 
 
2010  
€’000 
2009 
€’000 
2 cumulative expenditures for hotels under construction included in cost balances 3387 3803 
a cumulative expenditure for hotels under development relates to the renovation and conversion of the victoria monument building located  
in amsterdam into a hotel and to the development of art’otel hoxton london 
b the amount of borrowing costs capitalised during the year ended 31 december 2010 was €234000 2009 €322000 the rate used to 
determine the amount of borrowing costs eligible for capitalisation was 33 which is the effective interest rate of the specific borrowing 
3 for information regarding liens see note 17   notes to consolidated financial statements continued 
68   park plaza hotels annual report 2010 
note 6 aparthotel units sold to unit holders 
 
land 
€‘000 
hotel  
buildings 
€‘000 
furniture and 
equipment 
€‘000 
total 
€‘000 
cost     
balance as at 1 january 2010 – – – – 
reclassification from inventories under construction 19296 135787 5503 160586 
balance as at 31 december 2010 19296 135787 5503 160586 
accumulated depreciation     
balance as at 31 december 2010 – – – – 
depreciated cost as at 31 december 2010 19296 135787 5503 160586 
the construction of the westminster bridge london was completed in 2010 and the hotel partially opened to paying customers in march 2010 
as at 31 december 2010 the sale of 535 units out of the 865 units contracted to sell had been completed on the completion of each sale the 
purchaser was issued a “b” ordinary share in the management company of the hotel 1 westminster bridge plaza management company limited 
“1wb” marlbray a whollyowned subsidiary of the group and the owner of the freehold of the hotel holds the sole voting share being an “a” 
ordinary share this results in marlbray having control in 1wb until the later of 
1 the completion date of the sale of the last of the units forming part of the park plaza westminster bridge hotel and 
2 the expiry of the period of guaranteed returns to purchasers ie five years from the last completion  
provided that the relevant date shall not in any event be later than 31 december 2017 
as long as control over 1wb and therefore the indirect control over the aparthotel units stays within the group all of the conditions for  
revenue recognition from the sale of aparthotel units are not met hence in these consolidated financial statements the assets have not been 
derecognised and the proceeds received from the purchasers have been accounted for as an advance payment until such time as they can be 
recognised as revenue see note 2j 
note 7 prepaid leasehold payments 
 year ended 31 december 
 
2010 
€’000 
2009 
€’000 
cost   
balance as at 1 january 448 448 
balance as at 31 december  448 448 
accumulated amortisation   
balance as at 1 january  194 185 
provision for amortisation 10 9 
balance as at 31 december 204 194 
amortised cost as at 31 december  244 254 
in 1988 utrecht victoria hotel bv 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 €448000 at commencement of the lease  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   69 
note 8 investment in associate 
a acquisition of wmdmref bora bv 
in april 2008 euro sea a whollyowned subsidiary of the company acquired 20 of the shares of wmdmref bora bv “bora” from a 
group of real estate investment funds 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 or 
around pula on the istrian coast of croatia as part of the transaction the company also acquired 20 of the debt currently owed by bora to 
its shareholders the total consideration for the acquisition including the debt acquired was €224 million which was funded by the 
company from its existing cash resources the investment in bora is accounted for under the equity method in accordance with ias 28 
until 31 december 2009 the loan of €237 million had a fixed interest at the rate of 40 per annum as of 1 january 2010 the interest rate 
has changed to a fixed rate of 89 per annum and the denomination of the loan has changed from euro to kuna the repayment date of the 
loan is 15 july 2017 
b investment in associate 
 31 december 
 
2010 
€’000 
2009 
€’000 
loan to associate  25695 23715 
share of associate’s net liabilities under equity method 3730 1368 
foreign currency translation adjustment of associate 175 121 
loan to associate adjusted for losses recognised under the equity method 22140 22468 
c share of the associate’s balance sheet 
 31 december 
 
2010 
€’000 
2009 
€’000 
current assets 1636 1540 
noncurrent assets 30749 31742 
current liabilities 1827 1396 
noncurrent liabilities 34113 33133 
net liabilities 3555 1247 
loan to associate   
opening balance 23715 22759 
interest on loans 2206 956 
foreign transition reserve 226 – 
closing balance 25695 23715 
share of the associate’s revenue and loss   
revenue 6486 5921 
loss 2362 1195 
  notes to consolidated financial statements continued 
70   park plaza hotels annual report 2010 
note 9 other current financial assets 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
availableforsale investment shares
1 2 3
 1671 3142 
availableforsale investment in bonds stated in gbp
3
 – 11394 
 1671 14536 
1
 availableforsale investment in equities 
2
 the fair value of the availableforsale investment in shares and bonds is based on quoted market prices 
3
 gains from unrealised availableforsale investment in shares and bonds for an amount of €289000 2009 €348000 were recorded in equity profit of  
€346000 was classified to the income statement 2009 losses of €246000 
 31 december 
currency 
2010 
€’000 
2009 
€’000 
ils 144 137 
eur 1409 1808 
usd 118 1197 
 1671 3142 
note 10 other noncurrent financial assets 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
rent security deposits
1
 811 826 
loans to jointly controlled entities see note 29
2
 18795 17338 
loans to joint venture partners in jointly controlled entities
2
 7783 17142 
 27389 35306 
1
 relates to leases described in note 17c2 
2
 the amount owned by related parties bears interest and has no repayment date 
note 11 inventories under construction 
marlbray is the developer of westminster bridge hotel 535 aparthotel units were sold to individuals and were delivered to the purchasers upon 
completion of their purchase  
as at 31 december 2010 865 2009 854 of the 1019 aparthotel units had been presold or contracted to presell completion of the partial 
construction was in march 2010 as of the partial completion of the construction the aparthotel units were reclassified to property plant and 
equipment 
as at 31 december 2010 535 contracts have been completed and 330 contracts have been rescinded leaving 484 units retained by marlbray  
see note 2j 5 and 6  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   71 
note 12 trade receivables 
a composition 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
trade receivables 13619 4484 
related parties 3985 10147 
less – allowance for doubtful debts  428 246 
 17176 14385 
trade receivables are noninterest bearing the group’s policy provides 30 days’ payment terms  
b movements in the allowance for doubtful accounts were as follows 
 €’000 
as at 1 january 2009 244 
release for the year 4 
exchange rate differences 6 
as at 31 december 2009 246 
additions 176 
exchange rate differences 6 
as at 31 december 2010 428 
c as at 31 december the ageing analysis of trade receivables is as follows 
 
 
past due but not impaired 
 
total 
€’000 
neither past due 
nor impaired 
€’000 
 30 days 
€’000 
3060 days 
€’000 
6090 days 
€’000 
 90 days 
€’000 
2010 17176 2189 6602 3631 1183 3571 
2009 14385 1112 3415 1218 437 8203 
note 13 other receivables and prepayments 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
prepaid expenses 4082 1457 
vat 1506 1690 
corporate income tax – 170 
related parties 1252 1184 
vat loan to unit holders  2160 – 
others 557 636 
 9557 5137 
 the amount owed by related parties bears no interest and has no repayment date 
 the loans are for a period of five month and bear fixed interest of 1 monthly 
note 14 cash and cash equivalents  
cash at banks earns interest at floating rates based on daily bank deposit rates shortterm 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 shortterm deposit rates   notes to consolidated financial statements continued 
72   park plaza hotels annual report 2010 
note 15 equity 
a share capital and premium 
the authorised share capital of the company is represented by an unlimited number of ordinary shares with no par value 
on 29 december 2010 the company issued 1000000 ordinary shares to elbit which increased the share premium with £149 million  
€173 million see note 3c 
as at 31 december 2010 the number of ordinary shares issued was 42677292 2009 41677292 862000 of which were held as treasury 
shares 2009 862000 
b treasury shares 
on 29 september 2009 the company purchased 862000 of its ordinary shares at a price per share of 111p 
c 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  
 foreign currency translation reserve 
the foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements  
of foreign operations  
 other reserves 
the other reserves mainly consist of issue of shares upon acquisition of park plaza group in 2007 
note 16 sharebased 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 had an exercise price per share of £550 €620 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 the plan does not include any performance conditions 
b at any time the total number of shares issued andor available for grant in a tenyear 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 is disregarded  
the group’s remuneration committee met on 11 may 2009 to consider the options packages of all employees to ensure they are properly 
incentivised in the future on 10 june 2009 the remuneration committee made its recommendations to the board of directors and the board 
agreed to amend the options packages of all current employees as a result the options of current employees have been repriced to market value 
on 10 june 2009 being the day on which the recommendation of the remuneration committee was accepted by the board the updated strike 
price is 100p the board also agreed to the remuneration committee’s recommendation to grant additional share options for ordinary shares  
to current employees  
the fair value of the options is estimated at the grant date using the binomial pricing model according to the terms and conditions upon which 
the options were granted  
the following lists the inputs to the binomial model used in 2010 for the fair value measurement of both the modified share options plan and the 
previous granted share options  
 2010 
dividend yield  – 
expected volatility of the share prices  5500 
riskfree interest rate  304 
expected life of share options years 300 
share price at the grant date 095 
weighted average fair value gbp £035 
the expected life of the share options is based on historical data current expectations and empirical data it is not necessarily indicative of exercise 
patterns that may occur the expected volatility reflects the assumption that the historical volatility of similar listed companies over a period 
similar to the life of the options is indicative of future trends which may be reflective of the actual outcome 
based on the above inputs the fair value of the repriced options and the additional granted options is approximately £150000  
€169000 as at the grant date the incremental value of the repriced options is £033 
the expense arising from equitysettled sharebased payment transactions during 2010 is €30000 2009 €177000 during 2010 93473 
options became exercisable 2009 84662  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   73 
note 16 sharebased payments continued 
movements during the year 
the following table illustrates the number no and exercise prices ep of and movements in share options during 2010 and 2009 
 no of options a no of options b ep 
outstanding as at 1 january 2009 296634 90660 £550 €62 
options a granted during the year 6010 – £100 €112 
options a forfeited during the year 113094 – £100 €112 
options b granted during the year – 166193  £100 €112 
options b forfeited during the year – 17803 £100 €112 
outstanding as at 31 december 2009 189550 239050  
outstanding as at 31 december 2010 189550 239050  
the weighted average remaining contractual life for the share options outstanding as at 31 december 2010 is 80 years 2009 85 years 
note 17 pledges contingent liabilities and commitments  
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 
and restricted deposits are pledged in favour of banks and financial institutions as 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 described below 
1 on 3 march 2006 three jointly controlled companies riverbank hotel holding bv victoria london hotel holding bv and grandis 
netherlands holding bv the “borrowers” entered into a facility agreement as joint and several borrowers with goldman sachs 
international bank “goldman sachs” as lender for a nonrecourse refinancing loan in the amount of £1950 million €2050 million  
of which £1819 million attributable to the group £990 million including accrued interest was outstanding as at 26 november 2010 
the maturity date of the loan was 3 march 2011 or if the borrowers have exercised a termout option 3 march 2013  
 on 26 november 2010 the borrowers refinanced with aareal the €1950 million loan facility made by goldman sachs the refinancing 
involves 5year term facilities the “facilities” totalling £1650 million €1915 million the facilities are secured by inter alia pledges 
over the shares in the borrowers and first legal charges over the riverbank hotel and the victoria london hotel and sherlock holmes 
hotel as at 31 december 2010 the borrowers are fully owned by the company see note 3c 
 in addition to the new facilities the company together with elbit provided an equity injection of £166 million €193 million  
£89 million €103 million of which was provided by the company in order to enable the borrowers to repay the balance of the  
amount that was outstanding to goldman sachs  
 exit fees in an outstanding amount of £34 million €39 million attributable to the group £16 million €19 million were waived by 
goldman sachs and recorded in the income statements as a deduction from the finance expenses  
 the termination of the interest rate swap that had been entered into in connection with the goldman sachs facility resulted in costs  
of £144 million €231 million the “closeout costs” which as part of the overall financing were settled by aareal the borrowers 
have undertaken to pay to aareal the value of the closeout costs plus interest over the three years following the refinance by way of 
additional margin the closeout margin on the fixed rate of interest under the new interest rate swap with aareal referred to below  
the closeout margin amounts to 3265 the company has severally guaranteed the borrowers’ obligations in respect of the closeout 
costs plus interest  
 the facility agreement with aareal provide for two facilities facility a has a value of £1536 million €1783 million and is allocated to 
riverbank and victoria and will bear interest at 275 per annum over 3month sterling libor libor the interest on 85 of facility  
a £1306 million €1516 million has been fixed by means of an interest rate swap with aareal at 5295 per annum including  
the closeout margin for the first three years and 3275 for the remaining two years on top of these fixed rates a margin of 275  
per annum will be applied the 15 remaining balance of facility a will bear interest at 275 per annum over three months sterling  
libor libor 
facility b has a value of £114 million €162 million and is allocated to grandis facility b and will initially bear interest of 50 per 
annum over libor reducing to 295 per annum on the grant of security over the park plaza sherlock holmes the company has also 
severally guaranteed principal interest and costs under facility b but not facility a 
the facilities are repayable commencing in march 2011 in quarterly instalments of £625000 until september 2012 £750000 until 
september 2014 and £950000 until september 2015 the balance of the principal amount of the facilities amounting to 
£150825000 is repayable on 26 november 2015 repayments are to be applied first in reducing facility b  
the facility agreement provides that the borrowers must ensure that the aggregate amount of the outstanding facilities do not exceed 
68 of the value of the hotels as set out in the most recent valuation in addition the borrowers must ensure that on each interest 
payment date the debt service cover ratio the net operating income of the hotels for each of the four preceding financial quarters 
relative to the principal interest and other costs payable by the borrowers for the next four financial quarters is not less than 120  
as at 31 december 2010 the borrowers are in compliance with the covenants 
the facilities are secured by inter alia first legal charges over the riverbank hotel victoria london hotel and sherlock holmes hotel  
for further securities see note 17 4 b 
2 on 1 october 2004 two jointlycontrolled companies utrecht victoria hotel bv and victoria hotel cv and a whollyowned 
subsidiary the mandarin hotel bv as borrowers and guarantors entered into an €800 million attributable to the group  
€440 million term loan facility with merrill lynch international “the merrill facility” the merrill facility was repaid in full on  
maturity in september 2009   notes to consolidated financial statements continued 
74   park plaza hotels annual report 2010 
note 17 pledges contingent liabilities and commitments continued 
a pledges collateral and securities continued 
in september 2009 victoria hotel cv utrecht victoria hotel bv and the mandarin hotel bv “mandarin” “the borrowers”  
as joint and several borrowers and guarantors refinanced the merrill facility with aareal as lender for €780 million attributable to the 
group €430 million the refinanced facility is being repaid by fixed instalments over a term of five years and one final payment on the 
final maturity date the refinanced facility bears a fixed interest rate of 5116 per annum  
on 28 april 2010 the group acquired park plaza amsterdam airport the acquisition has been financed via an increase to the existing 
facility with aareal the enlarged facility has a value of €1110 million which includes €280 million for the acquisition and €50 million 
for the prospective renovations of park plaza victoria amsterdam €30 million and schiphol hotel €20 million the additional facility 
of €280 million bears a fixed interest of 456 per annum and the maturity date of the entire facility has been extended from  
30 september 2014 to 28 april 2017  
the facilities agreement provides that the borrowers must ensure that the aggregate amount of the outstanding facilities do not exceed 
65 of the value of the hotels as set out in the most recent valuation in addition the borrowers must ensure that on each interest 
payment date the debt service cover ratio the net operating income of the hotels for each of the four preceding financial quarters 
relative to the principal interest and other costs payable by the borrowers for the next four financial quarters is not less than 120  
for the first two years following 28 april 2010 the €280 million borrowed to fund the acquisition of park plaza amsterdam airport and 
the results of this hotel are excluded from the covenant calculation as at 31 december 2010 the borrowers are in compliance with the 
covenants 
in the event of cash distributions deriving from the sale disposal or refinancing of schiphol hotel or upon repayment of the loan 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 €300 million plus such proven renovation cost and equity injections as proved by the lender the estimation 
on the exit fees as of 31 december 2010 is not material 
on 14 december 2010 the borrowers and their shareholders have entered into an internal reimbursement agreement to limit the liability 
in respect of mandarin for and reimburse mandarin for any liability in excess of €79 million the mandarin loan in addition 
mandarin and its shareholder have agreed to reimburse the other parties for any liability in connection with the mandarin loan 
3 on 25 january 2006 three whollyowned subsidiaries parkvondel hotel real estate bv “phre” as borrower and parkvondel hotel 
holding bv “phh” and parkvondel hotel management bv “phm” as guarantors entered into a €185 million secured term 
facility agreement with nibc bank nv “nibc” as lender the maturity date of this facility was 25 january 2013 
in september 2008 phre phh and phm refinanced the nibc facility and entered into a €210 million secured term facility agreement 
with aareal as lender the maturity date of this facility is 3 september 2013 for further details see note 31h2 
the facility agreement provides that the borrowers must ensure that the aggregate amount of the outstanding facilities do not exceed 70 
of the value of the hotels as set out in the most recent valuation in addition the borrowers must ensure that on each interest payment 
date the debt service cover ratio dscr test the net operating income of the hotels for each of the four preceding financial quarters 
relative to the principal interest and other costs payable by the borrowers for the next four financial quarters is not less than 120 as at 
31 december 2010 the borrowers are in breach of the dscr covenant and the loan was reclassified to shortterm for further 
information see note 32 
4 on 14 december 2006 a jointly controlled company victoria monument bv as borrower and bank hapoalim as lender entered into 
a €140 million attributable to the group €70 million facility agreement the facility was made available to finance the purchase of a 
building located adjacent to the park plaza victoria amsterdam hotel the facility was initially made for one year and is being renewed 
every year for an additional year the facility was repayable in may 2011 and bears an interest of three month libor plus 225 per 
annum see note 32 3 
5 on 19 april 2007 marlbray as borrower entered into a £2210 million €2320 million facility agreement with bank hapoalim as 
lender in relation to the development of the park plaza westminster bridge hotel on 3 april 2009 marlbray entered into an amended 
and restated facility agreement with the bank for an increased amount of £2480 million the total drawdown as at 31 december 2010  
is £2480 million €2878 million 2009 £2380 million €2680 million during 2010 the repayment of the facility was financed out  
of the net proceeds of sales of units in the amount of £1542 million €1790 million and from forfeited deposits in the amount of  
£21 million €24 million as at 31 december 2010 the outstanding loan was £934 million €1084 million including accrued interest 
the facility has been amended and date for repayment has been extended to 31 may 2011 see note 32 2 
the interest rate on the original facility agreement is libor plus 215 per annum and on the increase made available in 2009 is libor 
plus 3 per annum the increase to the facility was fully repaid as at 31 december 2010  
as part of this facility the lender was provided with cost overrun and completion guarantees given by the company’s subsidiary euro sea 
hotels nv with a maximum amount payable of £300 million €338 million  
6 for details on the facilities assumed as part of the acquisition of leeds hotel and nottingham hotel see note 3b 
b restricted deposits and cash 
in connection with the development and sale by marlbray of aparthotel units see note 11 marlbray received deposits from prospective 
purchasers in respect of presold units up to 25 of the contracted sale price as part of the unit sale agreement marlbray was obliged to 
pay prospective purchasers a fixed interest of 6 per annum on the deposit until the date of completion as referred to in such agreement  
during 2010 marlbray paid the purchasers on completion of their purchase a total sum of £57 million €66 million on account of accrued 
interest on the deposits an amount of £3 million €35 million was written off and recognised as income due to certain purchasers’ failure  
to complete  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   75 
note 17 pledges contingent liabilities and commitments continued 
during 2010 deposits in the amount of £386 million €448 million including accrued interest were released from stakeholder account 
the deposits released offset the amount due from purchasers on completion of their purchase marlbray has also rescinded contracts of 
defaulting purchasers and forfeited their deposits in the amount of £21 million €24 million of which £19 million €21 million was 
recognised as other income in 2010 these funds were applied by marlbray towards repayment of the amount outstanding on the facility  
as at 31 december 2010 a balance of £156 million €182 million held at stakeholder account being forfeited deposits held in respect  
of the rescinded contracts of purchasers who failed to complete 
c commitments 
1 management and franchise agreements 
i the group entered into a territorial licence agreement 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 
and resorts” in 56 territories throughout europe the middle east and africa in perpetuity the “territory”  
the master agreement also allows the group 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 
ii the group entered into several management agreements with operated hotels and developed hotels located in the netherlands the 
united kingdom germany hungary and croatia “the hotels” in consideration for an annual fee of 2 to 3 of the hotels’ gross 
room or total revenues as applicable as well as 7 to 10 of the gross operating profit the group is also partially reimbursed for 
certain portions of the expenses incurred the management agreements are for periods of 15 to 25 years  
iii within the terms of the management agreements the hotels were granted by the group a subfranchise licence allowing them the 
utilisation throughout the term of the management agreements of the “park plaza
®
 hotels  resorts or art’otel
®
” name in 
consideration for royalties of a certain percentage of the gross room revenues  
2 lease agreements 
i the group has entered into several financial lease agreements for the rental of land certain of the leases are subject to periodic rent 
reviews the group’s share in the future minimum rental payments under noncancellable leases are as follows 
 
2010 
€’000 
2009 
€’000 
within one year 1045 558 
after one year but not more than five years 4178 2231 
more than five years 112591 60676 
 117814 63465 
less amounts representing finance charges 106956 57667 
present value of minimum lease payments 10858 5798 
   the present value of the discounted net minimum lease payments is as follows 
 
2010 
€’000 
2009 
€’000 
within one year – – 
after one year but not more than five years 1 1 
more than five years 10857 5797 
 10858 5798 
   following details regarding the finance lease agreements 
a in september 2000 grandis netherlands holding bv “grandis” a jointly controlled company acquired a land leasehold 
interest expiring in 2095 of the sherlock holmes hotel for a sum of £100 million €136 million plus an initial annual rent of 
£400000 €545000 subject to “open market value” rent review every five years  
 grandis 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 bv a jointly controlled company acquired a land leasehold interest expiring in 2125 of 
riverbank hotel situated on albert embankment london for a sum of £120 million €163 million plus an initial annual rent 
of £500000 €681000 subject to rent review every five years   notes to consolidated financial statements continued 
76   park plaza hotels annual report 2010 
note 17 pledges contingent liabilities and commitments continued 
c commitments continued 
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 of a minimum agreed 
amount and a percentage of the hotel turnover the rental expenses presented in the income statements of mainly consist of 
minimum lease payments 
future minimum rentals payable under cancellable operating leases are as follows 
 
2010 
€’000 
2009 
€’000 
within one year 9197 9900 
after one year but not more than five years 36787 32974 
more than five years 111209 100180 
 157193 143054 
3 construction contract commitment 
in march 2007 marlbray entered into a construction contract with ww gear construction limited “gear” the contract work 
comprises the design and construction on a “turnkey” basis of westminster bridge hotel 1019 units see note 11 as at 31 december 
2010 the total construction costs are approximately £1995 million €2096 million 2009 £1860 million €2096 million the 
balance of the construction cost commitment as at 31 december 2010 is £144 million €167 million  
gear is a company under the control of the principal shareholder of the company in whose shares the chairman of the board of 
directors has an interest see note 29  
4 guarantees 
a in june 2005 euro sea a whollyowned subsidiary of the company acquired a 3333 interest in marlbray in february 2008  
euro sea acquired the remaining 67 of the shares of marlbray 
on completion of each sale of the units marlbray entered into income swap agreements with almost all of the unit holders the 
income swap agreements includes an obligation on the unit holder to assign the right to receive the net income derived from the unit 
to marlbray and an undertaking by marlbray to pay unit holders a rent guarantee of a 5 or 6 pa yield as the case may be on the 
purchase price for the first five years following the date of the sale commencing on the second month following the date of 
completion of the purchase  
as part of the february 2008 acquisition the company has agreed to guarantee the obligations of marlbray under the income swap 
agreements this liability was taken into account in establishing the fair value of the inventory on acquisition date 
b the company has also guaranteed principal interest and costs under facility b but not facility a under the loan facility of the 
riverbank sherlock and victoria london hotels the company has also guaranteed the borrowers’ obligations in respect of the 
closeout costs plus interest save as aforesaid the facilities are without recourse to the company or any other member of its group 
apart from the borrowers and their subsidiaries see note 17 a1 
c the company has guaranteed all amounts due to elbit in connection with the acquisition of the sherlock holmes hotel victoria 
london hotel and riverbank hotel see note 3c  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   77 
note 18 bank borrowings 
a composed as follows 
current 
 
 
as at 31 december 
 
average interest  
rate 
 
2010 
€’000 
2009 
€’000 
bank loan in € libor  225 7000 7000 
bank loan in eur
2
 euribor  165 20159 – 
bank loan in gbp
1
 libor  215 108407 249014 
bank loan in gbp
1
 libor  300 – 19243 
current maturities of longterm bank loans  3728 2610 
  139294 277867 
 1
 for the maturity of the loan see see notes 17 5 and 322  
 2
 see also notes 17a3 and 321 
  as at 31 december 2010 
noncurrent 
 
 
as at 31 december 
 
average interest 
rate 
 
2010 
€’000 
2009 
€’000 
loans in € 512 – 542 55538 62375 
loans in gbp
1
 490 – 772 209760 112100 
  265298 174475 
less – current maturities  3728 2610 
  261570 171865 
 1
 see note 17a1 
  for details of interest rate swap see note 31h 
b the loans are payable in future years as follows 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
1 loan in €   
 first year – current maturities 860 855 
 second year 1075 1070 
 third year 1075 1495 
 fourth year 807 21130 
 fifth year – – 
 thereafter 51721 37825 
 55538 62375 
2 loan in gbp   
 first year – current maturities 2868 1755 
 second year 2702 1755 
 third year 7302 1755 
 fourth year 4434 106835 
 fifth year 173977 – 
 thereafter 18477 – 
 209760 112100 
 for securities and pledges see note 17  notes to consolidated financial statements continued 
78   park plaza hotels annual report 2010 
note 19 other liabilities 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
derivative financial instruments see note 31h 12950 8251 
lease liability 10858 5798 
loans from jointly controlled entities see note 29 18287 16720 
other loans from third parties 14876 – 
loans from partners in jointly controlled entities 8133 19819 
other  195 423 
 65299 51011 
note 20 other payables and accruals 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
employees 1434 1221 
vat and taxes
2
 4215 1805 
accrued interest 1314 1247 
accrued expenses 12819 4834 
other loans from third parties 5349 – 
accrued rent 3663 2394 
derivative financial instruments see note 31h 6062 – 
related parties
1
 2563 1627 
 37419 13128 
1
 the amount owed to related parties bears no interest and has no repayment date 
2
 includes corporate income taxes in 2010 of €292000 2009 €463000 
note 21 revenues 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
rooms 93357 49923 
food and beverage 36018 19387 
minor operating 2504 1637 
management fee see note 17c1 4602 5518 
franchise fee see note 17c1 2297 2858 
marketing 813 745 
other 238 258 
 139829 80326 
  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   79 
note 22 operating expenses 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
salaries and related expenses 42369 24149 
it expenses 1188 847 
utilities 4800 2910 
supplies 2080 985 
laundry linen and cleaning 2780 1771 
administration costs 4281 1946 
communication travel and transport 1368 1116 
maintenance 2279 1729 
marketing expenses 1950 1575 
food and beverage  7791 3924 
franchise fees reservation and commissions 9970 6449 
leases 954 242 
insurance  5752 2300 
other expenses  5820 4239 
 93382 54182 
note 23 financial expenses 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
interest and other finance expenses on bank loans 27510 21880 
interest and other finance expenses to jointly controlled entities see note 29b 836 734 
interest and other finance expenses to related parties 826 807 
interest on restricted deposits 1126 3126 
finance lease liability 578 558 
breakage of hedge financial instruments 8920 – 
refinance expenses 314 – 
loss on sale of availableforsale investments – 246 
other 44 161 
 40154 27512 
less – borrowing costs capitalised 11281 8572 
 28873 18940 
  notes to consolidated financial statements continued 
80   park plaza hotels annual report 2010 
note 24 financial income 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
interest on restricted deposit 76 2232 
profit on sale of available for sale investments 346 – 
interest on bank deposits 321 609 
interest from related parties see note 29 b 2206 956 
interest on vat loans to unit holders 252 – 
adjustment to fair value on derivative financial instruments 1403 – 
interest revenue penalty on late completion 339 – 
foreign exchange differences 321 583 
interest from forfeited deposits 3512 – 
interest and other finance income from jointly controlled entities 682 678 
interest and other finance expenses from partners in jointly controlled entities 939 739 
other 24 – 
 10421 5797 
note 25 other income net 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
negative goodwill upon acquisition note 3 9997 – 
pre opening expenses of park plaza westminster bridge hotel 2637 – 
capital gain from obtaining control in a former jointly controlled entity see note 3c 41435 – 
reclassification adjustment in respect of foreign currency translation reserve see note 3c 9390 – 
income from forfeited deposits 2166 – 
 60351 – 
note 26 income taxes 
a 1 taxes on income tax benefit included in the income statement 
 
as at 31 december 
 
2010 
€’000 
2009 
€’000 
current taxes 265 395 
deferred taxes 1156 106 
 1421 289 
 2 taxes have not been recognised on components of equity as they are not expected to be taxable  
b the following are the major deferred tax liabilities and assets recognised by the group and changes therein during the period 
 
tax loss carry  
forward 
€’000 
property plant 
and equipment 
and intangible 
assets 
€’000 
aparthotel units 
and property 
plant and 
equipment 
€’000 
other 
€’000 
total 
€’000 
balance as at 31 december 2008 3342 4108 8271 119 9156 
amounts charged to income statement  81 94   119 106 
adjustments for exchange rate differences – – 605 – 605 
balance as at 31 december 2009 3423 4202 8876 – 9655 
amounts charged to income statement  654 1481 329 – 1156 
adjustments for exchange rate differences – – 271 – 271 
balance as at 31 december 2010 2769 2721 8818 – 8770  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   81 
note 26 income taxes continued 
c reconciliation between tax expense and the product of accounting profit multiplied by the group’s tax rate is as follows 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
profit loss before income taxes 60482 7160 
expected tax at the tax rate of the netherlands 255
1
 15423 1826 
adjustments in respect of   
income at 0 tax rate 4721 5511 
nondeductible expenses 1599 6276 
settlement with carried forward losses – 182 
reduction in uk tax rate  329 – 
nontaxable income 15098 – 
tax losses for which no deferred tax was recorded 4964 1350 
timing differences for which no deferred taxed were recorded 2847 – 
taxes in previous years 338 – 
other 74 182 
income tax expense reported in the income statement 1421 289 
 1
 the tax rate that was used is the tax rate of the netherlands since the majority of the tax exposure is in this tax jurisdiction 
d tax laws applicable to the group companies  
1 the company is subject to taxation under the law of guernsey 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 as follows  
a taxation in the netherlands corporate income tax rate is 255 
b taxation in the uk corporate income tax rate for domiciled companies is 28 and for nondomiciled 22 on 9 december 2010 
the government in the united kingdom has decided to reduce the tax rate for 2011 to 27 effective from 1 april 2011 after the 
balance sheet date the tax rate for 2011 was reduced to 26 the impact of the reduction of the tax rate to 26 would create an 
additional tax income of £03 million €03 million 
c taxation in germany corporate income tax rate and business rates is 302 
d taxation in hungary corporate income tax rate is 180 
e losses carried forward for tax purposes 
the company and its subsidiaries have carry forward losses for tax purposes estimated at approximately €1654 million 2009 €1112 
million the group did not establish deferred tax assets in respect of losses amounting to €1545 million 2009 €979 million of which  
nonunited kingdom tax losses amounting to €866 million may be utilised for a period up to eight years the remaining united kingdom tax 
losses may be carried forward indefinitely 
note 27 earnings per share 
the following reflects the income and share data used in the basic earnings per share computations 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
profit loss  61903 7449 
weighted average number of ordinary shares outstanding 40815 41460 
potentially dilutive instruments share options – see note 16 have not been included in the calculation of diluted earnings per share because they 
are antidilutive for all periods presented  notes to consolidated financial statements continued 
82   park plaza hotels annual report 2010 
note 28 segments 
for management purposes the group’s activities are divided into owned hotel operations and management activities for further details see 
note 17c1 owned hotel operations are further divided into three reportable segments the netherlands germany and hungary and the 
united kingdom the operating results of each of the aforementioned segments are monitored separately for the purpose of resource allocations 
and performance assessment segment performance is evaluated based on ebitda which is measured on the same basis as for financial 
reporting purposes in the statement of income 
 
as at 31 december 2010 
 
the netherlands 
€’000 
germany and 
hungary 
€’000 
united kingdom 
€’000 
management 
€’000 
holding 
companies and 
adjustments
2 
€’000 
consolidated 
€’000 
revenue       
third party 22847 27700 81179 8103 – 139829 
intersegment – – 389 12618 13007 – 
total revenue 22847 27700 81568 20721 13007 139829 
segment ebitda 7607 286 24512 10438 4638 37633 
depreciation and amortisation      12409 
financial expenses      28873 
financial income      10421 
interest expenses on advance payments from 
unit holders      4279 
other income net      60351 
share in loss of associate      2362 
loss before taxes       60482 
 
 the netherlands 
germany and 
hungary  united kingdom adjustments consolidated 
geographical information      
noncurrent assets
1
 75166 7620 682523 43076 808385 
1
 noncurrent assets for this purpose consist of property plant and equipment prepaid leasehold payments and intangible assets and aparthotel units 
2
 consist of intercompany eliminations for further details see note 17c1 and note 29 
 
as at 31 december 2009 
 
the netherlands 
€’000  
germany and 
hungary 
€’000 
united kingdom 
€’000 
management 
€’000 
holding 
companies and 
adjustments
2 
€’000 
consolidated 
€’000 
revenue       
third party 19779 23456 27518 9573 – 80326 
intersegment – – 1504 6869 8373 – 
total revenue 19779 23456 29022 16442 8373 80326 
segment ebitda 6474 3725 11369 5928 3802 16244 
depreciation and amortisation      9066 
financial expenses      18940 
financial income      5797 
share in loss of associate      1195 
loss before taxes       7160 
 
 the netherlands 
germany and 
hungary  united kingdom adjustments consolidated 
geographical information      
noncurrent assets
1
 59775 7428 121173 45385 233761 
1
 noncurrent assets for this purpose consist of property plant and equipment prepaid leasehold payments and intangible assets 
2
 consist of intercompany eliminations for further details see note 17c1 and note 29  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   83 
note 29 related parties  
a balances with related parties 
 31 december 
 
2010 
€’000 
2009 
€’000 
loans to jointly controlled entities
3
 18795 17338 
loan to associate – whdmref bora
1
 25695 23715 
shortterm receivables  1252 1184 
trade receivables –leeds hotel and nottingham
 
hotel
2
 – 3328 
loans from jointly controlled entities
4
 18287 16720 
trade receivables – arenaturist group
1
 3985 2452 
trade receivables – jointly controlled entities – 4367 
trade payables – ww gear construction limited see note 17c3 14002 – 
shortterm payables – ww gear construction limited 2208 1627 
shortterm payables – other 355 – 
b transactions with related parties 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
management fees income – arenaturist
1
 1225 1113 
reimbursement of expenses – arenaturist
1
 347 396 
expenses related to jointly controlled entities   
– conference 454 459 
– salaries 164 164 
– legal 427 427 
fee income – leeds hotel and nottingham
 
hotel
2
   
– management fee 173 329 
– franchise fees  58 99 
– marketing fees  38 66 
– reservation fees  115 148 
– reimbursement and other fees  41 84 
interest from associate – whdmref bora
1
 2206 956 
interest and other financial expenses to jointly controlled entities 836 734 
interest income from jointly controlled entities 682 678 
construction costs incurred and capitalised to inventories 31206 77230 
  balances and transactions are with shareholders and companies controlled by shareholders unless otherwise stated 
 1
 the group holds 20 of the equity of whdmref bora see note 8 
2
 prior to 2 august 2010 leeds hotel and nottingham
 
hotel were each whollyowned by the principal shareholder of the company on 2 august 2010 the company 
purchased leeds hotel and nottingham
 
hotel see note 3b 
3
 includes loans to jointly controlled entities in the amount of €110 million 2009 €109 million bearing fixed interest of 6125 per annum a loan of €58 million  
2009 €53 million bearing an interest of libor2 per annum and a loan of €20 million 2009 €11 million bearing no interest 
 4
 includes loans from jointly controlled entities in the amount of €183 million 2009 €167 million bearing fixed interest of 4 per annum  notes to consolidated financial statements continued 
84   park plaza hotels annual report 2010 
note 29 related parties continued 
c compensation to key management personnel executive and nonexecutive board members for the year ended in 31 december 2010 
 position base salary pension other benefits total 
  €’000 €’000 €’000 €’000 
boris ivesha chief executive officer 395 117 74 586 
chen moravsky chief financial officer 275 33 72 380 
eli papouchado nonexecutive chairman of the board 117 – – 117 
kevin mcauliffe nonexecutive director 46 – – 46 
nigel jones nonexecutive director 41 – – 41 
elisha flax nonexecutive director 47 – – 47 
  921 150 146 1217 
director’s interests in employee share incentive plan 
as at 31 december 2010 the chief financial officer holds share options to purchase ordinary shares in the amount of 95000 the options are 
fully exercisable with an exercise price of £100 €112 the options will expire in 2017 nonshare options have been granted to nonexecutive 
members of the board 
note 30 jointly controlled entities 
the group has an interest in jointly controlled entities appendix b which are engaged in the development management and operation of hotels 
for further information regarding the terms of loans with jointly controlled entities see note 29 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 
 
2010 
€’000 
2009 
€’000 
noncurrent assets 91500 172848 
current assets 3380 12877 
 94880 185725 
noncurrent liabilities 61506 182157 
current liabilities 12003 23756 
 73509 205913 
 21371 20188 
 
 as at 31 december 
 
2010 
€’000 
2009 
€’000 
revenues 45032 41297 
operating expenses 29378 25820 
ebitdar 15654 15477 
rental expenses 1008 503 
ebitda 14646 14974 
depreciation and amortisation 4032 4945 
ebit 10614 10029 
financial expenses net 18434 11464 
loss before income taxes 7820 1435 
income tax benefit expense 629 349 
loss for the year 7191 1784 
  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   85 
note 31 financial risk management objectives and policies 
the group’s principal financial instruments other than derivatives comprise bank borrowings cash and cash equivalents restricted deposits and 
investment in shares and bonds 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 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 credit risk and liquidity 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 
a foreign currency risk 
the group is exposed to minimal foreign currency risk due to transactions in foreign currency as most of the transactions of each of the 
entities in the group are denominated in the functional currency of the relevant entity 
b interest rate risk 
the group’s exposure to the risk for changes in market interest rates relates primarily to the group’s longterm debt obligations with  
a floating interest rate  
the group has two variable interest rate debts relating to a shortterm loan for the renovation of a hotel building and a gbp shortterm loan 
for the construction of the westminster bridge hotel london the interest expense on these loans is capitalised during the construction 
period in april 2010 the construction of the westminster bridge hotel was partially completed and the hotel started to operate the interest 
on the gbp short term loan was recorded in the profit and loss based on this sensitivity analysis calculation the management expects that 
with an increasedecrease of the threemonth market libor interest rate by 50 bps the results of the group would be changed by €290000 
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 furthermore the group uses fixed interest rate debts for this reason the group’s 
cash flow is not sensitive to possible changes in market interest rates possible changes in interest rates do however affect the group’s equity 
or results as the fair value of the swap agreements changes with interest rate changes these swaps are designated to hedge underlying debt 
obligations  
the fair value of the swaps of the group as at 31 december 2010 amounts to a liability of €150 million 2009 liability of €82 million  
the movements in the value have been accounted for in equity and profit and loss respectively the group performed a sensitivity analysis  
for the effect of market interest rate changes on the fair value of the swaps which was calculated by an external valuator based on this 
sensitivity analysis calculation the management expects that with an increasedecrease of the threemonth market interest rate by 50 bps  
the fair value of the swaps and the hedge reserve in equity would increasedecrease by €02 million 2009 €18 million and the results  
would increasedecrease by €22 million 2009 nil 
the group uses shortterm deposits weekly and monthly for cash balances held in banks  
restricted deposits that were received from unit holders see note 17b were held in bank accounts in the united kingdom bearing interest  
at a average annual rate of 02 2009 46 
as at 31 december 2010 the group has additional deposits in the amount of €44 million the interest income is subject to changes in the 
interest rates in 2010 the average received interest rate was 0203 2009 05 if the interest rate increasedecrease is an average of 
50bps the profit of the group would not change materially due to low interest given on deposits 
c credit risk 
the group trades only with recognised creditworthy third parties it has policies in place to ensure that sales of products are made to 
customers with an appropriate credit history the company’s policies ensure that sales to customers are settled through advance payments 
in cash or by major credit cards individual customers since the group trades only with recognised third parties there is no requirement  
for collateral for debts with third parties furthermore the group has no dependency on any of its customers the receivable balances are 
monitored on an ongoing basis management monitors the collection of receivables through credit meetings and weekly reports on individual 
balances of receivables impairment of trade receivables is recorded when there is objective evidence that the company will not be able to 
collect all amounts due according to the original terms of receivables the maximum credit exposure equals the carrying amount of the trade 
receivables and other receivables since the amount of all trade and other receivables have been written down to their recoverable amount  
the result of these actions is that the group’s exposure to bad debts is not significant  
with respect to credit risk arising from other financial assets of the group which comprise cash and cash equivalents investment in securities 
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  
the group as at 31 december 2010 has a balance of €40 million 2009 €64 million from associates the group has agreed that most  
of the outstanding amount will be settled in the course of 2011  
d market risk 
the group as at 31 december 2010 has an availableforsale investment in securities in the amount of €17 million 2009 €145 million 
the securities are presented at their quoted market price and changes in market price are recorded in equity if the market prices of the 
securities increasedecrease by an average of 1 the equity of the group would increasedecrease by €17000 2009 €145000 
  notes to consolidated financial statements continued 
86   park plaza hotels annual report 2010 
note 31 financial risk management objectives and policies continued 
e 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 mediumterm bank facilities to finance its construction operation and then to convert them into long
term borrowings when required 
the table below summarises the maturity profile of the group’s financial liabilities as at 31 december 2010 and 2009 based on contractual 
undiscounted payments 
 as at 31 december 2010 
 
less than 
3 months 
€’000 
3 to 12 months 
€’000 
1 to 2 years 
€’000 
3 to 5 years 
€’000 
 5 years 
€’000 
total 
€’000 
interest bearing loans and borrowings
 12
 4401 130907 62974 208025 74628 480935 
deposits received from unit holders – 21999 – – – 21999 
deposits hold in banks – 18234 – – – 18234 
derivative financial instruments 1515 4546 10669 – – 16730 
loans to jointly controlled entities and 
partners in jointly controlled entities – – 12480 – 22676 35156 
loans from jointly controlled entities and 
partners in jointly controlled entities – – 12080 – 23306 35386 
other financial liabilities – – – 123 72 195 
loans to elbit 1637 4787 13416 3047 1016 23903 
lease liability 
4
 261 783 2089 3133 111546 117812 
trade payables 6250 18748 – – – 24998 
other liabilities 9047 12830 – – – 21877 
  23111 168836 89548 214329 186632 682455 
 
 as at 31 december 2009 
 
less than  
3 months 
€’000 
3 to 12 months 
€’000 
1 to 2 years 
€’000 
3 to 5 years 
€’000 
 5 years 
€’000 
total 
€’000 
interest bearing loans and borrowings 
12
 4232 287950 30756 177572 – 500510 
deposits received from unit holders 825 64582 – – – 65407 
deposits hold in banks 110 64689 – – – 64799 
other restricted deposits – 1937 – – – 1937 
loans to jointly controlled entities and 
partners in jointly controlled entities – – – 5709 40651 46360 
loans from jointly controlled entities and 
partners in jointly controlled entities – – – 5767 37569 43336 
other financial liabilities – – – 117 306 423 
lease liability 
4
 139 418 1115 1673 60118 63463 
trade payables 4853 – – – – 4853 
other liabilities 4360 6963 – – – 11323 
  14299 293287 31871 179304 63506 582267 
 1
 see note 17a for further information 
2
 the company has an outstanding loan in the amount of €1084 million 2009 €1630 million which was due to be repaid in may 2011see note 322 
 3
 for further details in respect of a guarantee provided to the partner in a jointly controlled entity see note 17a2 
4
 lease liability includes two leases with upward rent reviews based on future market rates in one lease and changes in the cpi in the other lease and thus future 
payments have been estimated using current market rentals and current united kingdom based cpis respectively 
 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 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 in 2009 the gearing ratio was above 70 due to the construction of the westminster bridge 
hotel project and is expected to reflect temporary deviation  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   87 
note 31 financial risk management objectives and policies continued 
 capital management continued 
 
2010 
€’000 
2009 
€’000 
interest bearing loans and borrowings 400864 449732 
less – cash and cash equivalents 25637 34418 
less – other liquid assets 5298 11394 
net debt 369929 403920 
equity 203218 139735 
hedging reserve 1087 9096 
total capital 204305 148831 
capital and net debt 574234 552751 
gearing ratio 644 731
 
 carrying amount fair value 
 31 december 31 december 
 
2010 
€’000 
2009 
€’000 
2010 
€’000 
2009 
€’000 
financial assets     
other noncurrent financial assets 27389 35306 27254 39075 
restricted deposits 21999 66516 21999 66516 
other current financial assets 1671 14536 1671 14536 
trade receivables 17176 14385 17176 14385 
other receivables  8051 1820 8051 1820 
cash and cash equivalents 25637 34418 25637 34418 
total assets 101923 166981 101788 170750 
 
 carrying amount fair value 
 31 december 31 december 
 
2010 
€’000 
2009 
€’000 
2010 
€’000 
2009 
€’000 
financial liabilities     
floating rate borrowings 326891 407530 326891 407530 
fixed rate borrowings 73974 42202 76603 41867 
derivative financial instruments 19012 – 19012 – 
other financial liabilities 46840 36962 46571 40101 
lease liability 10858 5798 10858 5798 
trade payables 24998 4853 24998 4853 
deposits received from unit holders 18234 63757 18234 63757 
other payables and accruals 21676 11323 21676 11323 
total  542483 580676 544842 583480 
the fair value of the financial assets and liabilities are included in the amount at which the instrument could be exchanged in a current 
transaction between willing parties other than in a forced or liquidation sale the following methods and assumptions were used to estimate 
the fair values  
• cash and cash equivalents trade receivables trade payables and other current assets and liabilities approximate their carrying amounts 
largely due to the shortterm maturities of these instruments 
• longterm fixedrate and variablerate receivablesborrowings are evaluated by the group based on parameters such as interest rates 
specific country risk factors and individual creditworthiness of the customer and the risk characteristics of the financed project based  
on this evaluation allowances are taken to account for the expected losses of these receivables  
• the fair value of unquoted instruments loans from banks and other financial liabilities obligations under finance leases as well as other 
noncurrent financial liabilities is estimated by discounting future cash flows using rates currently available for debt on similar terms 
credit risk and remaining maturities 
• fair value of availableforsale financial assets is derived from quoted market prices in active markets  
• the group enters into derivative financial instruments with financial institutions with investment grade credit ratings derivatives are 
valued using valuation techniques for swap models using present value calculations the models incorporate various inputs including the 
credit quality of counterparties and interest rate curves  
as at 31 december 2010 the marktomarket value of the derivative asset position is net of a credit valuation adjustment attributable to 
derivative counterparty default risk the changes in counterparty credit risk had no material effect on the hedge effectiveness assessment 
for derivatives designated in hedge relationship and other financial instruments recognised at fair value  notes to consolidated financial statements continued 
88   park plaza hotels annual report 2010 
note 31 financial risk management objectives and policies continued 
2 fair value hierarchy 
the group uses the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique 
level 1 quoted unadjusted prices in active markets for identical assets or liabilities 
level 2 other techniques for which all inputs which have significant effect on the recorded fair value are observable either directly  
or indirectly 
level 3 techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable  
market data 
as at 31 december 2010 the group held the following financial instruments measured at fair value  
  assets 
 
31 december  
2010 
€000 
level 1 
€000 
level 2 
€000 
level 3 
€000 
availableforsale financial assets     
equity shares 1671 1671 – – 
  liabilities 
 
31 december  
2010 
€000 
level 1 
€000 
level 2 
€000 
level 3 
€000 
financial liabilities     
interest rate swaps 19012 – 19012 – 
 during the year as at 31 december 2010 there were no transfers between level 1 and level 2 fair value measurements and no transfers 
into and out of level 3 fair value measurements 
as at 31 december 2009 the group held the following financial instruments measured at fair value  
  assets 
 
31 december  
2009 
€000 
level 1 
€000 
level 2 
€000 
level 3 
€000 
availableforsale financial assets 3142 3142 – – 
equity shares 11394 1194 – – 
  liabilities 
 
31 december  
2010 
€000 
level 1 
€000 
level 2 
€000 
level 3 
€000 
financial liabilities     
interest rate swaps 8251 – 8251 – 
 during the year as at 31 december 2009 there were no transfers between level 1 and level 2 fair value measurements and no transfers 
into and out of level 3 fair value measurements 
h derivative financial instruments 
the majority of the group’s borrowings are at variable interest rates based on libor to limit its exposure to changes in the rates of the 
libor and euribor on its cash flows and interest expense the group has entered into various interest rate swaps as described below 
1 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 £1850 million attributed to the 
group £990 million received from goldman sachs international bank with fixed interest rate of 772 for the period until 2011 on 26 
november 2010 the group had refinanced the loan with aareal see note 17a 1 a separate arrangement with aareal has been made 
to meet the costs of terminating the existing interest rate swap the closeout costs amounting to £144 million which as part of the 
overall financing were settled by aareal the borrowers have undertaken to pay to aareal the value of the closeout costs plus interest 
over the next three years by way of additional margin the closeout margin on the fixed rate of interest under the new interest rate swap 
with aareal referred to below  
contract with nominal values of £1306 million €1516 million has fixed interest quarterly payments at a rate of 5295  per annum 
including close out costs margin for periods up until november 2013 and for the period november 2013 until november 2015 at  
a rate of 3275 
as at 31 december 2010 the fair value of the swap is estimated at a liability of £120 million €139 million 2009 liability of £116 
million €135 million attributable to the group liability of £63 million €71 million the interest swap of the expected future interest 
was assessed to be not effective the change in fair value of the interest rate swap of £17 million €20 million attributable to the group 
£09 million €10 million has been recorded in the profit and loss the swap of the expected future interest of 2009 was assessed to be 
very effective and the change of £43 million €50 million attributable to the group £23 million €27 million had been recorded in 
the other comprehensive income for further information see note 17 a 1  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   89 
note 31 financial risk management objectives and policies continued 
h derivative financial instruments continued 
2 in 2008 phre phh and phm entered into an interest rate swap according to which phre phh and phm swapped the variable 
interest rate of three months euribor on a loan in the amount of €210 million received from aareal bank ag bearing fixed quarterly 
interest payments at the rate of 377 per annum for the period until september 2013 as at 31 december 2010 the fair value of the 
swap is estimated at a liability of €11 million 2009 liability of €11 million the swap of the expected future interest of was assessed  
to be very effective and the change recorded in the other comprehensive income the amount recorded in the other comprehensive 
income was immaterial for both 2010 and 2009 
3 in 2004 laguna and katmandu which were purchased by the group in august 2010 entered into an interest rate swap according to 
which they swapped the variable interest rate according to which  
laguna swapped the variable interest rate of three month libor on a loan in the amount of £150 million €174 million received from 
the royal bank of scotland plc bearing fixed quarterly interest payments at the rate of 513 for the period until january 2019 as at  
31 december 2010 the fair value of the swap is estimated at a liability of £22 million €26 million the swap of the expected future 
interest was assessed to be not effective since the group did not obtain the proper documentation and the amount of £03 million  
€03 million was recorded in the profit and loss as interest income 
katmandu swapped the variable interest rate of three month libor on a loan in the amount of £60 million €69 million received from 
the royal bank of scotland plc bearing fixed quarterly interest payments at the rate of 554 for the period until october 2010 as at 
31 may 2027 the fair value of the swap is estimated at a liability of £13 million €15 million the swap of the expected future interest 
of was assessed to be not effective since the group did not obtain the proper documentation and the amount of £01 million €01 
million was recorded in the income statement as interest income 
note 32 post balance sheet events 
1 phre phh and phm facility agreement see note 17 a3 provides that the borrowers must ensure that the aggregate amount of the 
outstanding facilities do not exceed 70 of the value of the park plaza vondelpark hotel as set out in the most recent valuation ltv test 
in addition the borrowers must ensure that on each interest payment date the debt service cover ratio the net operating income of 
the hotel for each of the four preceding financial quarters relative to the principal interest and other costs payable by the borrowers for 
the next four financial quarters dscr test is not less than 120 as at 31 december 2010 and 31 march 2011 phre phh and phm 
failed the dscr test and as at 31 march 2011 the aggregate amount of the outstanding facility exceeded 70 of the hotel value on  
12 april 2011 the borrowers reached an agreement with the lender to reduce the principal facility amount by €09 million in order to cure 
the position as at 31 december 2010 and 31 march 2011 dscr test and 31 march 2011 ltv test in addition certain requirements 
under the facility agreement were waived for a period of 12 months ending 30 june 2012 
2 on 1 june 2011 marlbray signed an agreement to refinance the existing facility of westminster bridge hotel london with bank  
hapoalim for a further seven years until 1 june 2018 as at 31 december 2010 the outstanding amount of the facility was £934 million 
€1084 million 
the amended facility is split into two facilities the “facilities” for an overall amount of £1150 million €1335 million with the existing 
indebtedness as at the date of the agreement of £939 million €1090 million remaining in place and a new facility of £211 million 
€245 million being added to finance working capital general corporate purposes and certain projects  
the facilities are repayable commencing in september 2011 in quarterly instalments for an amount equal to 2 per annum of the drawn 
amount until september 2016 increased to 25 per annum of the drawn amount until the maturity date of the facilities the remaining 
balance of the principal is repayable on the final maturity date  
the facilities will bear an interest of 265 per annum over 3month sterling libor which will increase by 2 on any part of the facilities 
that causes the loan to value ratio as set out below to exceed 70 in addition marlbray has undertaken among others to pay 
£125000 per annum as an agency and security trustee fee subsequent to its entry into the facilities marlbray will enter into an interest 
rate swap to hedge the risk of any fluctuations in the interest rate  
the agreement provides that marlbray must ensure that the aggregate amount of the outstanding facilities does not exceed 75 of the 
value of the hotel as set out in the most recent valuation in addition marlbray must ensure that on each interest payment date the  
debt service cover ratio dscr the net operating income of the hotels for each of the four preceding financial quarters relative to the 
principal interest and other costs payable by marlbray for the next four financial quarters is not less than 115 for the first year of the 
loan and thereafter is 130 and that the dscr ratio is not less than the applicable percentages more five times during the life of the 
facilities 
3 on 30 may 2011 victoria monument bv entered into a deed of amendment to the credit agreement dated 14 december 2006  
with bank hapoalim as amended and restated from time to time and under which the final maturity date had been extended to  
31 august 2011 see note 17a4 
  appendices to financial statements  
90   park plaza hotels annual report 2010 
appendix a subsidiaries and investments included in the group 
 
principal activity country of incorporation 
direct and indirect 
holdings  
euro sea hotels nv
2
  holding company the netherlands 100 
the mandarin hotel bv
2
  hotel operation the netherlands 100 
suf holding bv
2
  holding company the netherlands 100 
victory enterprises i bv
2
  holding company the netherlands 100 
victoria monument bv
2
 holding company the netherlands 50 
vhri bv
2
  holding company the netherlands 50 
vhrms bv 
2
 hotel operation the netherlands 50 
utrecht victoria hotel cv
2
  hotel operation the netherlands 50 
victoria hotel cv
2
  hotel operation the netherlands 50 
riverbank hotel operator limited
2
  hotel operation united kingdom 100 
riverbank hotel holding bv
2
  holding company the netherlands 100 
victoria london hotel holding bv
2
  holding company the netherlands 100 
victoria park plaza operator limited
2
  hotel operation united kingdom 100 
victoria pub holding bv
2
  holding company the netherlands 100 
sherlock holmes park plaza limited
2
  hotel operation united kingdom 100 
grandis netherlands holding bv
2
  holding company the netherlands 100 
marlbray limited
2
  holding company united kingdom 100  
1 westminster bridge plaza management company limited
2
 hotel operation united kingdom 100
4
 
park plaza hospitality services uk limited
2 
hotel operation united kingdom 100 
whdmref bora bv
2 3 
holding company the netherlands 20 
w2005twenty eight bv
 
holding company the netherlands 20 
bora finco bv holding company the netherlands 20 
waterford investments limited
1
 holding company guernsey  100 
leno investments limited
 1
 holding company guernsey 100 
leno finance limited
2
 holding company guernsey 100 
laguna estates leeds limited
2
 holding company guernsey 100 
katmandu limited
2
 holding company british virgin islands 100 
sandbach investments limited
2
 holding company british virgin islands 100 
hotel leeds holding bv
2
 holding company the netherlands 100 
hotel nottingham holding bv
2
 holding company the netherlands 100 
nottingham park plaza operator limited
2
  hotel operation united kingdom 100 
park plaza hotels europe holdings bv
2
  holding company the netherlands 100 
park plaza hotels europe bv
2
  management the netherlands 100 
park plaza hotels germany services gmbh
2
  management germany 100 
park plaza hotels europe germany bv
2
  management the netherlands 100 
sugarhill investments bv
2
  holding company the netherlands 100 
park plaza germany holdings gmbh
2
  holding company germany 100 
park plaza berlin hotelbetriebsgesellschaft mbh
2 
 hotel operation germany 100 
park plaza hotels berlin wallstrasse gmbh
2
  hotel operation germany 100 
park plaza betriebsgesellschaft mbh holding company germany 100 
art’otel berlin mittepark plaza betriebsgesellschaft mbh
2
  hotel operation germany 100 
art’otel berlin city center west gmbh
2
  hotel operation germany 100 
art’otel dresdenpark plaza betriebsgesellschaft mbh
2
  hotel operation germany 100 
art’otel sw hotelbetriebs kft
2
  hotel operation hungary 100 
art’otel köln betriebsgesellschaft
2 
mbh hotel operation germany 100 
park plaza nürnberg gmbh
2
 hotel operation germany 100 
parkvondel hotel holding bv
2
  holding company the netherlands 100 
parkvondel hotel real estate bv
2
 holding company the netherlands 100 
parkvondel hotel management bv
2
  hotel operation the netherlands 100 
golden wall investments limited
1
  holding company british virgin islands 100 
apex holdings uk limited
1
 holding company british virgin islands 100 
aspirations limited
2
 holding company british virgin islands 50 
park plaza coöperatief ua
1
 holding company the netherlands 100 
park plaza hotels uk services limited
2  
management united kingdom 100 
1
 direct holdings 
2
 indirect holdings 
3
 investment in an associate  
4
 such percentage reflects 100 of the voting rights in the company  notes to consolidated financial statements continued 
park plaza hotels annual report 2010   91 
appendix b jointly controlled entities 
name of company principal activity country of incorporation 
proportion of  
ownership interest 
 
vhri bv holding company the netherlands 50 
vhrms bv hotel operation the netherlands 50 
utrecht victoria hotel cv hotel operation the netherlands 50 
victoria hotel cv hotel operation the netherlands 50 
melbourne personeel bv hotel operation the netherlands 50 
schiphol victoria hotel cv holding company the netherlands 50 
victoria schiphol holding bv holding company the netherlands 50 
melbourne holding bv hotel operation the netherlands 50 
melbourne onroerende zaken bv holding company the netherlands 50 
victoria monument bv holding company the netherlands 50 
aspirations limited holding company british virgin islands 50  appendices to financial statements continued 
92   park plaza hotels annual report 2010 
appendix c  
the following information is a combination of financial information extracted from the ifrs financial reporting packages of each of the jointly 
controlled entities riverbank hotel holding bv grandis netherlands holdings bv and victoria london hotel holding bv as prepared for 
inclusion in the consolidated financial statements of the company on a proportional consolidation basis for each of the three years ended 31 
december 2010 2009 2008 the proportion already held the proportion acquired on 31 december 2010 and the resulting totals are presented 
the combination is an arithmetic addition of the financial information of each of the jointly controlled entities and hence the information does 
not include the acquisition accounting adjustments related to these entities which have been made in the consolidated financial statements 
 year ended 31 december 2010 year ended 31 december 2009 year ended 31 december 2008 
 
proportion 
already 
held 
proportion 
acquired total 
proportion 
already 
held  
proportion 
acquired total 
proportion 
already  
held  
proportion 
acquired total 
assets          
noncurrent assets          
property plant and 
equipment 91499  79875  171374  105241  91745  196986  101580  87790  189370  
other noncurrent 
financial assets 518  381  899  – –  – – – – 
 92017  80256  172273  105241  91745  196986  101580   87790  189370  
current assets          
restricted cash – – – 1626  1426  3052  93 82 175 
inventories 148  134  282  162  147  309  132  120  252  
trade receivables 1361  1183  2544  1635  1442  3077  1571  1400  2971  
other receivables and 
prepayments 1509  1346  2855  1948  1721  3669  1592  1395  2987  
cash and cash equivalents 4077  3689  7766  4302  3876  8178  3556   3207  6763  
 7095  6352  13447  9673  8612  18285   6944   6204  13148  
total assets 99112  86608  185720  114914  100357  215271  108524  93994  202518  
 
equity and liabilities          
equity 44465 37344 81809 48501 41116 89617 41515 35998 77513 
noncurrent liabilities          
bank borrowings 84564  74750  159314  110346  96759  207105  104100   91276  195375  
other liabilities 43187  35470  78657   40208   33479  73687   35557  29721  65279  
 127751  110220  237971  150554  130238  280792  139657  120997  260654  
current liabilities          
trade payables 1945  1738  3683  1067   920  1987   635   571  1207  
other payables and 
accruals 
 12506  10869   23375  10038   8777  18815  8111  6989  15100  
bank borrowings 
1375  1125  2500  1755  1539  3294  1636  1434  3070  
 
15826  13732  29558  12860  11236  24096  10382  8995  19377  
total equity and 
liabilities 99112  86608  185720  114914  100357  215271  108524  93994  202518  
 
 year ended 31 december 2010 year ended 31 december 2009 year ended 31 december 2008 
 
proportion 
already 
held 
proportion 
acquired total 
proportion 
already 
held  
proportion 
acquired total 
proportion 
already  
held  
proportion 
acquired total 
revenues  30091  26468  56559  29022   25633   54655  33273   29302   62574  
operating cost 18944   16632   35576  17167   15102   32269  21689   19049   40738  
ebitdar 11147  9836   20983  11855   10531   22386  11583   10253   21836  
rental expenses 980  803  1783  477  394  871   473  387  860  
ebitda 10167  9033   19200  11378   10137   21515  11110  9866   20976  
depreciation and 
amortisation 3195  2663   5858  4209  3651  7860  5900  5032   10932  
ebit 6972   6370   13342  7168  6486   13654  5210  4834  10044  
financial expenses 18630  16283   34913  10652  9299   19951  17078  15160  32238  
financial income 1540  1424  2964   16  14  29   87  79  166  
loss before tax  10118 8489 18607  3468 2800 6268 11781 10247 22028 
income tax benefit 
expense  298  298  596   320  320  640 29  29  58 
loss for the year  9820   9191  18011  3788 3120 6908 11810 10276 22086 
  park plaza hotels annual report 2010   93
independent auditors’ report to the members  
of park plaza hotels limited 
we have audited the consolidated financial statements “the financial 
statements” of park plaza hotels limited and subsidiaries “the 
group” for the year ended 31 december 2010 which comprise the 
consolidated balance sheet the consolidated income statement  
the consolidated statement of comprehensive income the 
consolidated statement of changes in equity the consolidated 
statement of cash flows and the related notes 1 to 32 the financial 
reporting framework that has been applied in their preparation is 
applicable law and international financial reporting standards  
ifrss as adopted by the european union
this report is made solely to the company’s members as a body in 
accordance with section 262 of the companies guernsey law 2008 
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 auditor’s 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 auditor
as explained more fully in the statement of directors’ responsibilities 
the directors are responsible for the preparation of the financial 
statements and for being satisfied that they give a true and fair view 
our responsibility is to audit and express an opinion on the financial 
statements in accordance with applicable law and international 
standards on auditing uk and ireland those standards require  
us to comply with the auditing practices board’s ethical standards  
for auditors 
scope of the audit of the financial statements
an audit involves obtaining evidence about the amounts and  
disclosures in the financial statements sufficient to give reasonable 
assurance that the financial statements are free from material 
misstatement whether caused by fraud or error this includes an 
assessment of whether the accounting policies are appropriate to  
the group’s circumstances and have been consistently applied and 
adequately disclosed the reasonableness of significant accounting 
estimates made by the directors and the overall presentation of  
the financial statements in addition we read all the financial and 
nonfinancial information in the annual report to identify material 
inconsistencies with the audited financial statements if we become 
aware of any apparent material misstatements or inconsistencies we 
consider the implications for our report
opinion on financial statements
in our opinion the financial statements
•	  give a true and fair view of the state of the group’s affairs as  
at 31 december 2010 and of its profit for the year then ended
•	  have been properly prepared in accordance with ifrss as 
adopted by the european union and
•	  have been prepared in accordance with the requirements  
of the companies guernsey law 2008
matters on which we are required to report by exception
we have nothing to report in respect of the following
under the companies guernsey law 2008 we are required  
to report to you if in our opinion
•	 proper accounting records have not been kept or
•	  the financial statements are not in agreement with  
the accounting records or
•	  we have not received all the information and explanations  
we require for our audit
ernst  young llp
guernsey channel islands
1 june 201 1
independent auditors’ report 94   park plaza hotels annual report 2010
project location operating structure no of rooms status
extension of art’otel berlin  
city center west 
berlin germany operating lease 60 expected to open 2012
art’otel amsterdam amsterdam  
the netherlands
coowned and  
management contract
105 expected to open 2012
park plaza nuremberg nuremberg germany owned 175 expected to open 2013
art’otel london hoxton london  
the united kingdom
joint venture and 
management contract 
352 expected to open 2013
number of rooms in  
development pipeline
692
the franchise agreements for art’otel potsdam and the park plaza marrakech project were terminated in the year
current and committed projects park plaza hotels annual report 2010   95
directors
eli papouchado nonexecutive chairman 
boris lvesha president and chief executive officer 
chen moravsky chief financial officer 
eiisha flax nonexecutive director 
kevin mcauliffe nonexecutive director 
nigel jones  nonexecutive director
park plaza hotels corporate office
viñoly tower 5th floor 
claude debussylaan 14 
1082 md amsterdam 
the netherlands 
t  31 020 717 8603 
f 31 020 717 8699 
e cmoravskypphecom 
wwwparkplazahotelsnet
contacts
chen moravsky chief financial officer and board member 
inbar zilberman  general counsel 
robert henke vice president marketing  branding
administrator
cl secretaries limited 
1st and 2nd floors 
elizabeth house 
les ruettes brayes 
st peter port 
guernsey gy1 1ew 
channel lslands
auditors to the company   
and reporting accountants
ernst  young llp 
po box 9 royal chambers  
st julian’s avenue  
st peter port  
guernsey gy1 4af  
channel islands 
legal advisors to the  
company as to english law
norton rose llp 
3 more london riverside 
london se1 2aq 
united kingdom
legal advisors to the  
company as to guernsey law 
carey olsen 
carey house 
p o box 98  
les banques 
st peter port 
guernsey gy1 4bz 
channel lslands
registered office
1st and 2nd floors 
elizabeth house 
les ruettes brayes 
st peter port 
guernsey gy1 1ew 
channel lslands
registrar
capita registrars guernsey limited 
mont crevelt house 
bulwer avenue 
st sampson 
guernsey gy2 4lh  
channel islands 
company secretary
cl secretaries limited 
1st and 2nd floors 
elizabeth house 
les ruettes brayes 
st peter port 
guernsey gy1 1ew 
channel lslands
financial adviser and broker 
investec investment banking  
a division of investec bank plc 
2 gresham street 
london ec2v 7qp 
united kingdom
financial public relations
hudson sandler 
29 cloth fair 
london ec1a 7nn 
united kingdom
useful links
corporate website 
wwwparkplazahotelsnet
for reservations 
wwwparkplazacom 
wwwartotelscom 
wwwarenaturistcom 
wwwarenacampscom
strategic partner 
wwwcarlsoncom 
contacts 96   park plaza hotels annual report 2010
notes this annual report is printed on 100  
recycled cocoon offset paper and cocoon 50 
silk paper 
cocoon offset is certified according to the rules  
of the forest stewardship council
designed and produced by luminouscouk park plaza hotels corporate office
viñoly tower 5th floor 
claude debussylaan 14 
1082 md amsterdam 
the netherlands 
t  31 020 717 8603 
f 31 020 717 8699 
wwwparkplazahotelsnet


Summary:
 chief executive officer’s statement
we are now seeing the benefits  
of our strategic investments
welcome 
2010 was an active and exciting year in our 
development significant progress was made 
on a number of projects and we started to 
benefit from our development pipeline and 
hotel acquisitions 
a key highlight in the year was the opening of 
our flagship hotel the 1019 room park plaza 
westminster bridge london 
a total of 1579 rooms were added to 
the portfolio during the year through the 
addition of two newly built hotels in london 
and cologne and one acquisition near 
amsterdam airport and 123 rooms were 
removed following the termination of a 
franchise agreement in germany bringing the 
total number of rooms operated by us at the 
yearend to approximately 8400 
we also successfully completed the 
refinancing of three of our london hotels 
park plaza victoria london park plaza 
riverbank london including plaza on the 
river and park plaza sherlock holmes 
london and through a subsequent 
transaction we now have full ownership  
of these hotels 
in 2010 trading conditions in all the markets 
in which we operate improved there were 
early signs of recovery in the first half despite 
the travel disruption in northern europe 
as a result of heavy snow in january 2010 
and the unprecedented closure of airspace 
in april 2010 as a result of the volcanic ash 
cloud from iceland this recovery gained 
momentum in the second half of the year as 
demand from both corporate and leisure 
travellers increased 
once again our established london 
hotels – park plaza victoria london park 
plaza riverbank london including plaza 
on the river and park plaza sherlock 
holmes london – performed strongly in 
the year with revpar for each of these 
hotels outperforming the average revpar 
of its competitive set in 2010 str global 
december 2010 
as a result we are pleased to report a strong 
financial performance for the year to  
31 december 2010 which exceeded the 
board’s expectations total reported  
group revenue increased by 741 to  
€1398 million and ebitda grew by 1321  
to €37 6 million as we started to benefit from 
our development pipeline 
portfolio growth 
we significantly extended our presence in the 
affordable luxury hotel market through the 
addition of three hotels to our portfolio 
in march 2010 park plaza westminster 
bridge london was partially opened to 
paying guests followed by its full opening  
in september 2010 as at 31 december 2010 
we completed the sale of 535 units with 484 
units having been retained by the group 
the newly built art’otel cologne in germany 
opened in march 2010 located in a prime 
location on the bank of the river rhine  
this hotel offers 218 rooms excellent  
meeting facilities and has received very 
encouraging customer feedback 
in april 2010 we acquired with a joint 
venture partner a large conference hotel 
with 342 rooms near amsterdam schiphol 
airport the hotel was rebranded park plaza 
amsterdam airport immediately following 
our acquisition
in addition to these new hotels added to 
our portfolio in the year in august 2010 
we acquired the freehold and headlease 
interests of park plaza leeds and park 
plaza nottingham prior to this acquisition 
both hotels were operated and continue 
to be operated by us under longterm 
management agreements 
on 31 december 2010 we acquired the 
remaining joint venture interests in and 
shareholder loans related to park plaza 
victoria london park plaza riverbank 
london including plaza on the river and 
park plaza sherlock holmes london 
strengthening the brands 
our teams continued to maximise the 
benefits available through our strategic 
partnership with carlson one of the world’s 
leading travel and hospitality companies 
which provides us with access to a stateof
theart reservation and global distribution 
platform as well as participation in global 
sales and marketing programmes room 
revenue generated via carlson’s reservation 
system has continued to increase and  
now accounts for approximately 40  
of our room revenue 
this growth is primarily driven by increased 
online marketing initiatives and our active 
engagement in the club carlson
sm
 the former 
goldpoints plus™ guest reward programme 
in 2010 this programme provided us with 
access to a marketing database of over 
63 million guests an increase of 24 in 
number of members compared to 2009 
carlson is planning to double the size of 
club carlson
sm
 to 10 million members 
by 2013 our hotels collectively signed up 
over 47 500 new members in 2010 alone 
various enhancements to the programme 
have made it one of the most attractive in 
the industry and it is now easier and faster 
for guests to collect and redeem points at 
any carlson hotel in early 201 1 a dedicated 
club carlson
sm
 app for mobile devices was 
launched marking the park plaza
®
 brand’s 
debut in this space
we have also invested in our internal 
marketing resources and in particular in  
our online marketing team to grow the 
revenue contribution of both the park plaza
®
  
and art’otel
® 
websites 
service excellence
core to our business is the quality of service 
standards and level of guest satisfaction in 
2008 we introduced a leading online guest 
satisfaction survey system enabling us to 
monitor and improve our guests’ experience 
nearly 39000 guest surveys were completed 
during the year a 35 year on year increase 
and all new hotels and several franchised 
hotels were added to the system in the 
year we are very proud to report that we 
continued to increase our scores across all  
key performance indicators for guest 
satisfaction service and product 
performance and guest loyalty 
4   park plaza hotels annual report 2010 our staff are responsible for the increased 
guest satisfaction levels and their constant 
focus on delivering a high quality service  
has paid off 
we actively engage with our employees and 
with the number of employees increasing 
by 29 primarily as a result of the new 
openings it was vital to successfully deliver 
new uniformed introduction welcome 
packs and our connect service training 
programme we were successful in delivering 
these essential tools on time and we are 
proud to report that overall employee 
satisfaction has increased year on year  
by 27 to a healthy 810
our development projects
alongside the three new hotel openings in the 
year we continued to invest in the planning 
and development of new hotel openings as 
well as renovation and refurbishment projects 
in order to further enhance the quality of  
our hotel portfolio and these projects 
continue in 201 1 
in the united kingdom construction work 
for the 352 room art’otel
®
 located in the 
hoxton area of london is due to commence 
in 201 1 and the hotel is scheduled to open in 
2013 refurbishment projects are planned at 
park plaza leeds and park plaza nottingham 
following our acquisition of these hotels in 
august 2010
in the netherlands we are investing 
approximately €250 million in our portfolio 
in the construction of the art’otel amsterdam 
and extensive refurbishment programmes for 
the flagship park plaza victoria amsterdam 
the newly acquired park plaza amsterdam 
airport the centrally located park plaza 
utrecht and our inaugural hotel park  
plaza eindhoven 
in germany and hungary work has 
commenced on a 60 room extension 
at art’otel berlin city center west and a 
renovation programme will commence at 
art’otel budapest progress in development 
of park plaza nuremberg continues and the 
hotel is expected to open in 2013
we also continued with several refurbishment 
projects across the arenaturist portfolio 
during the year in particular extensive room 
renovations commenced at hotel histria and 
these are due to be completed for the start  
of the 2012 season at several hotels  
the restaurants bars and pool areas were 
also renovated
current trading
whilst the first quarter is historically the 
weakest of the year we are pleased to report 
that we have continued to trade in line with 
the board’s expectations during the three 
months to 31 march 201 1 
as anticipated trading conditions have 
continued to improve across all markets  
in which we operate 
in the united kingdom revpar has grown 
significantly year on year notably our 
london hotels reported a strong increase in 
average room rate and we are now seeing the 
true benefits from the fully operational park 
plaza westminster bridge london 
in the netherlands revpar has also 
increased compared with the first quarter 
of 2010 a result of improved average room 
rates at all of our hotels in the netherlands 
ebitda declined due to fewer rooms being 
available at park plaza victoria amsterdam 
and park plaza eindhoven as a result of 
extensive renovations in the first quarter  
the majority of rooms closed for renovations 
are now open and management is confident 
that we will strongly benefit from these 
improved hotels 
in germany and hungary revpar at our 
hotels during the first quarter improved 
significantly compared to the first quarter in 
2010 this is a particularly good performance 
considering that last year’s revpar 
performance in germany was supported 
by the government’s vat reduction the 
reported growth in revpar is a result of 
increased average room rates and has been 
further improved by the art’otel cologne 
which opened mid march 2010 
the ebitda loss was also reduced during the 
first quarter of 201 1 as we started to benefit 
from renegotiated lease agreements and 
improved trading conditions 
our management and holdings  
operation has performed in line with  
the board’s expectations 
looking forward we remain focused on 
continuing to improve overall performance 
fundamentally by growing average room 
rates and maintaining careful cost control 
we will continue to progress our confirmed 
development projects and are actively 
exploring new growth opportunities 
boris ivesha 
president and chief executive officer
park plaza hotels annual report 2010   5