Killarney brewing company collapse: covid cost overruns and whiskey tariffs blamed
The Killarney Brewing and Distilling company in Fossa, Killarney County Kerry where a liquidator was appointed on Monday. Picture: Don MacMonagle
The Killarney Brewing and Distilling Company which went into liquidation this week had dozens of creditors when it entered the examinership process in April, with more than €8m owed.
The company confirmed the unsuccessful conclusion of its examinership process on Tuesday, with more than 50 jobs impacted by the brewery ceasing operations. The company premises included the plush multi-million euro brewery, whiskey distillery, and visitor centre overlooking the lakes of Killarney in Fossa.
The independent expert’s report filed as part of a petition to the High Court in April showed Killarney Brewing Company had a creditors' listing topping €8m. Included in the list of creditors of the brewing company were Kerry County Council, which was owed an outstanding amount of just over €108,000, and the Revenue Commissioners, who were owed €143,400.
The report said the financial difficulties of the company predominantly arose from delays and the significant overspend on the construction of the company’s Fossa facility, which went through an extensive renovation in 2021 and 2024, which it said impacted the company’s profitability and cash flow.
The estimated cost overrun caused by pandemic-related issues was around €8m, the report said
“As all the hospitality businesses were predominantly closed during the peak pandemic years and completion of the Fossa unit was delayed, significant trading losses were incurred as investment monies raised, which were forecasted to assist with early years working capital, were utilised on the construction-related overspend,” the report said.
To address the significant construction overrun costs and aid working capital, the group borrowed around €4.4m from a number of sources in December 2022, the report also noted.
Speaking this week, the company said high tariffs on Irish whiskey exports to the US and wider economic uncertainty further hurt the business and had compounded previous challenges arising from the pandemic and ongoing global tensions.
"Like many in the drinks manufacturing industry, KBD has faced significant and sustained challenges in recent years, stemming from the lasting effects of the pandemic, delays in opening our state-of-the-art distillery in Fossa, global supply chain disruptions, rising input costs, and ongoing geopolitical and trading pressures," the brewery said.
"More recently, high tariffs on Irish whiskey exports to the US and wider economic uncertainty have further impacted the business."
Earlier this year, the company had reached a preliminary agreement to merge with a US-based strategic partner, but the partner ultimately chose not to proceed. In response, KBD entered the examinership process in the hope of securing new investment to protect jobs and stabilise operations for the long term.
A spokesperson for the liquidator declined to comment.
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