Hotel company records €53.2m losses after property value writedown

THE company that operates the four-star Meyrick Hotel in Galway’s Eyre Square recorded losses totalling €53.2 million in 2009 and 2008, new figures show.

Accounts just filed by ML Meyrick Ltd show the chief factor behind the losses was the company writing down the value of its property asset by €50m from €70m to €20m in the two years to the end of December 2009.

The Meyrick is part of Galway businessman, Gerry Barrett’s Edward Holdings Group and accounts just filed by 23 of the group’s 27 Irish-based companies to the Companies Office outline the deterioration of the group’s finances in the two year period to the end of December 2009.

Auditors Deloitte & Touche confirm that a number of the companies are in a liability position and are dependent on the financial support of the National Assets Management Agency (NAMA) and the continuing support of group companies to be able to continue as a going concern.

Along with the Meyrick, Mr Barrett owns the five- star Ashford Castle in Mayo and the G Hotel, Galway.

An auditor’s report filed for Niche Hotels, that operates the G Hotel also discloses that the company is in the red, though does not provide figures as the company has unlimited status and as such not obliged to file accounts with the Companies Office.

The write-down of €50m in ML Meyrick Ltd follows confirmation that the Barrett-owned company operating Ashford Castle recorded write-downs of €35m in 2009 and 2008.

The Meyrick was part of the Dublin Airport Authority’s Great Southern Hotel Group and Mr Barrett purchased three of the hotels in 2006 for a reported €130 million, later selling the Killarney-based hotel for around €40m.

The accounts disclose that ML Meyrick Ltd owes €79.9m to a group company, KH Kitty Hall Holdings. Separate accounts for KH Kitty Hall Holdings show that its accumulated losses rose from €95.2m to €133.3m during the year.

The losses in 2009 arise mainly from the company writing off €30m in intercompany loans. KH Kitty Hall had bank loans due in one year totalling €151m.

Separate accounts for another Edward Group subsidiary, property investment company, MD Merlin Developments Ltd show the company recorded losses totalling €13.4m in 2009.

A note attached to the accounts of the companies states that: “Bank loans in those group companies, together with other group loans, were transferred to NAMA in February 2010. The group has submitted a business plan to NAMA. The successful implementation of the business plan is dependent on the support of NAMA and discussions with NAMA in this regard are ongoing.

“Until this matter is finalised, it remains a material uncertainty which may cast significant doubt upon the company’s ability to continue as a going concern and therefore, the company may be unable to realise its assets and discharge its liabilities in the normal course of business.