Accounts just filed with the Companies Office by Torriam Hotel Operating Company Ltd show that the company’s revenues declined by 20% from €17m to €13.5m to the end of December last.
The hotel on Dublin’s St Stephen’s Green re-opened in March 2007 after being closed for one year due to refurbishment, increasing the number of rooms to 265.
The hotel’s owners include developers Bernard McNamara and Jerry O’Reilly and last year TOHCL’s pre-tax loss of €2.89m follows the company recording a pre-tax profit of €343,604 in 2008.
The hotel was purchased by a consortium including Mr McNamara, Mr O’Reilly, John Sweeney, David Courtney and Bernard Doyle for €140m in 2004.
A subsidiary of hotel giant, Marriott International, TOHCL is currently in legal dispute with the hotel’s owner, Shelbourne Hotel Holdings Ltd (SHHL), which is seeking to terminate the 20-year management deal with TOHCL. TOHCL denies any default justifying the termination of the agreement.
A note in the new accounts confirm that TOHCL commenced arbitration proceedings against SHHL and a hearing was held last July.
The note states that during the course of the hearing SHHL quantified their counter-claim at €9 million, plus unquantified interests and costs. The note adds that the outcome of the hearing will not be known for some months and no provision is yet required for any award that might be made in relation to the dispute.
The accounts show that the largest contributory factor to TOHCL recording a loss last year was an 80% increase in administrative costs, going from €3.5m to €6.4m.
The accounts show that the hotel’s staff numbers last year reduced by 130 from 616 to 486 with the aggregate payroll costs decreasing by 15% from €14.9m to €12.6m, though the accounts indicate that the staff’s salaries were paid by the hotel’s owners.
The company’s turnover is derived from management fees, payroll services and operating a reservation centre for Marriott group companies, though the business from the reservation centre was transferred to another group company in September 2009 with €3.6m in revenues generated from that business last year. The company’s operating loss last year was €2.7m, compared to an operating profit of €526,428 in 2008.