K Club firm racks up another year in the red
Bishopscourt Investments, the company behind the prestigious K Club, has failed to arrest the luxury hotel and golf club's near-decade run of losses, with the latest accounts recording another steep descent into the red.
The newly-filed financial statements show the Michael Smurfit controlled-entity widened its losses for the 2015 financial year to €3.7m, compared with €3.2m in 2014.
However, recent renovations at the luxury resort, coupled with the steady rise in the numbers of tourists, heralds a possible turnaround in the business which has languished in the red in the years following the crash.
The accounts, approved by the directors on November 10, cite "general economic, financial and business conditions" as a threat to the group's future operating performance and warn that "events that reduce domestic or international travel" pose a risk to room rates and occupancy levels.
In 2012, Mr Smurfit bought out his former business partner Gerry Gannon's stake in the hotel and golf course, for about €40m in a deal that kept the prestige resort away from the control of Nama.
While turnover rose to €14.2m in 2015, versus €12.8m in 2014, overheads, including administrative costs, selling and distribution costs as well as staff wages all increased.
The accounts show the company owes creditors €76.6m, compared to the €62.1m owed in 2014.
The K Club's prestige reached a peak in 2006 when the five-star resort hosted the Ryder Cup. Over the past few years several top-end hotels have ploughed money into refurbishments and extensions in a bid to capture a greater share of the luxury tourist market. High-spending visitors are travelling to Ireland in increasing numbers and it is expected the K Club will benefit from this trend.
The resort doubled the number of bedrooms to 134 in 2015 and Bishopscourt Investments's accounts indicate the extension cost €13m.
The company owed Mr Smurfit €57.2 at the end of 2015, suggesting he funded the refurbishment.