Profits jump 20pc to €7.6m at Irish hotel group Tifco
Pre-tax profits at Tifco - the Irish hotel group that's been up for sale since earlier this year with a €600m-plus price tag - jumped more than 20pc last year to €7.6m.
The company, which manages or owns 24 properties including the well-known Clontarf Castle hotel in Dublin as well as The Metropole in Cork, said it benefited from higher room rates during the year.
Tifco owns 18 of the hotels in its portfolio.
Turnover rose 7.5pc to €37.2m last year, according to accounts just filed for the business.
"Occupancy levels and average room rate continued to show strong growth, and the revenue per available room grew by 10.2pc," directors noted in the accounts.
Managing director Enda O'Meara declined to comment on the results or on the sales process that was initiated for the group earlier this year by Goldman Sachs.
Goldman Sachs has been an investor in Tifco since 2014, when it bought the hotel group's debt from Irish Bank Resolution Corporation, formerly Anglo Irish Bank.
The sale of Tifco will include properties around the country and the new owner will also have the option to pre-fund a new 392-bedroom hotel on Dublin's Townsend Street.
Tifco's minority shareholders include DID Electrical founder Gerry Houlihan, whose family also owns Clontarf Castle.
Tifco has been planning extensions to some of its properties.
Earlier this year, it applied for planning permission to add a five-storey extension to a hotel it owns near Dublin Airport.
That will increase the number of rooms at the property by 60 to 269.
The 10.2pc growth in Tifco's revenue per available room last year compares favourably to that achieved across the sector.
A recently published annual survey from accountancy practice Crowe found that revenue per available room across the country rose 7pc during 2017. In Dublin, revenue per available room was 9pc higher.
The increase in hotel profitability generally has made it increasingly likely that a special 9pc Vat rate that applies to the sector, and a limited number of others, will be rescinded at the next Budget.
It was introduced as a temporary measure in 2011 during the financial crisis.
In a review of the 9pc Vat rate published last month, the Department of Finance said it had cost the Exchequer €2.6bn since its introduction in 2011, and was now a "significant deadweight".
The Department said the reduced rate cost €490m in 2017.
Accounts for Clontarf Castle show that its pre-tax profits surged last year by more than €1m to €3.6m. Its turnover rose to €12.3m from €11.6m.
The company behind the hotel paid a €1.5m dividend to the owners.