Directors of 4-star hotel ‘respond to challenges’ as pre-tax profits halve

PRE-TAX profits at one of Munster’s best known hotels, the 4-star Dunraven Arms Hotel in Adare, Co Limerick, more than halved last year to €354,388.

Accounts just returned to the Companies Office show that The Dunraven Arms Hotel Ltd’s gross profit dropped by 5% from €4.3 million to €4.2m in the 12 months to the end of October last year.

The hotel — which employs 73 people — includes a conference centre and leisure centre in the scenic Limerick village that attracts hundreds of thousands of tourists each year.

The revenues of the hotel would have been boosted with the hosting of the JP McManus invitational charity Pro-Am last year.

The abridged accounts show that the company’s pre-tax profits dropped from €797,333 to €354,388. The profits last year resulted in accumulated profits of €5m at end of October.

According to the directors’ report, the directors “are responding to the current challenges in the marketplace and do not anticipate any significant changes in the nature of business in the foreseeable future”.

The directors say there has been increased competition in the hotel industry.

“The ongoing challenge for the company is maintaining sales and gross margin and controlling overheads and required capital expenditure. The directors have initiated appropriate actions in respect of same.”

The figures show that the company’s operating profit dropped from €777,383 to €335,233.

The accounts show that the company’s administrative expenses increased last year by €286,000 from €2.65m to €2.94m with operating expenses remaining static at €1m.

The profits take account of non-cash depreciation cost of €234,332.

A dividend of €62,439 was paid last year compared to a dividend of €51,000 in 2009. The company had 5.7m in shareholder funds.

The numbers it employed last year remained at the same level at 73 and the company’s staff costs amounted to €2.7m, that includes remuneration to directors totalling €404,431.