High costs drag Fota Island resort owner into loss

High costs drag Fota Island resort owner into loss

By Gordon Deegan

The Hong Kong-owned firm that operates Fota Island Resort in Cork recorded a modest loss of €4,478 last year as the company further invested in the resort.

High costs drag Fota Island resort owner into loss

In 2013, the Kang family purchased the five-star Fota Island Resort for a reported €20m and quickly followed that purchase by snapping up the Kingsley Hotel in Cork City for €6m.

The Fota resort had been built by Irish developer John Fleming for over €90m and was sold on behalf of Nama to the Kang hotelier family.

Newly filed accounts for Xiu Lan Hotels Ltd, which operates the hotel, convention centre, and spa resort, show that the business recorded a small loss of €4,478 in the 12 months to the end of September.

That loss followed a profit of €417,814 in 2016. The latest loss takes account of hefty non-cash depreciation costs of €971,238.

The accounts also disclose that the company has a capital commitment of €960,000 this year in relation to the renovation of 30 bedrooms.

The investment this year followed investment in the property last year which resulted in an additional €2.4m being added to the book value of the company’s fixed assets.

Separate accounts for the company that operates the Kingsley Hotel in Cork, Xiu Lan Riverside Hotel Ltd, show that pre-tax profits last year decreased by 10% to €659,126.

The drop in profits came in spite of the company’s gross profit increasing from €7.5m to €8.05m.

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