Merrion co-owners hit by 18% drop in profits

The hotel group that co-owns the luxury five-star Merrion Hotel in Dublin last year sustained an 18% drop in pre-tax profits to £2m (€2.43m).

The decline in profits at the Northern Ireland-based Hastings Hotels Group came despite the group increasing its revenues by 4% from £37.59m to £39.2m in the 12 months to the end of October 31 last.

The figures show that the Merrion Hotel outperformed the group last year with the group’s joint venture share of the Merrion’s operating profit increasing marginally from £537,304 to £555,170.

The group owns 50% of the Merrion Hotel and the group’s revenues from its Merrion Hotel interest last year increased by 8.5% from £6.62m to £7.19m.

During 2013, superstars, Rihanna, Bruce Springsteen and Michael Bublé were three of the many celebrities to boost the coffers of the hotel that last month secured planning permission from An Bord Pleanála for a major extension.

The group owns its share of the Merrion hotel through its 50% shareholding in Landmark Investment Co Ltd.

The Hastings Group portfolio of hotels includes the landmark Europa hotel in Belfast and the luxury Culloden Hotel on the outskirts of Belfast.

According to the report, “the directors consider that the out-turn for the year is satisfactory given difficult economic conditions which created a difficult trading environment throughout the financial year and they are satisfied with the progress that has been made during the year.”

The directors state that the external commercial environment is expected to remain competitive in 2014.

The group’s increase in revenues last year followed a return to growth in 2012 which came after two years of a decline in sales when revenues declined by 6.5% in 2011 and 7.3% in 2010.

The group paid an interim dividend last year of £386,453 following a dividend payout of £368,053 in 2012. The figures show the group’s operating profit last year declined by 18% from £2.71m to £2.2m.