Profits soar at Louis Fitzgerald's group as directors cut pay
Pre-tax profits at the Louis Fitzgerald pub and hotel empire more than doubled last year to €3.3m as the directors paid themselves less.
Mr Fitzgerald owns some of the best known pubs in the country: the Quays pubs in Temple Bar, Dublin and Galway, along with the Stag's Head, Kehoes, the Big Tree, the Baggot Inn and the Grand Central Cafe bar in Dublin.
The group operates 18 pubs along with the Arlington Hotel in Dublin and the four-star Louis Fitzgerald Hotel at Newlands Cross.
New accounts lodged by Ocsas Holdings show that the group's profits jumped to €3.3m from €1.56m in the 12 months to the end of last June. The increase in profits came despite a 2pc fall in sales to €54.3m.
The chief factor behind the profit hike was a decision by directors Louis and Helen Fitzgerald to cut pay to €442,304 last year from €2.28m in 2011. This is some way off the €8.6m the two received in aggregate remuneration in 2009.
"Despite difficult trading conditions and the pressures on the licensed trade and hotel industry as a whole, the group achieved an operating profit of €8m compared to €6.2m in 2011," the report said.
Combined non-cash depreciation and amortisation costs last year totalled €5m and the directors state that earnings before interest, taxation, depreciation and amortisation was €13m compared to €11.2m in 2011.
"The directors are of the view that, despite the current difficult economic climate, the actions taken to reduce cost, introduce improved work practices and efficiencies and developing new marketing strategies to generate extra business will ensure that the business will continue to be profitable," the report added.
"This will also ensure that when the current economic climate improves, we will be in a strong position to take immediate advantage of improved circumstances."
The group reduced its bank loans during the year from €86.8m to €82.8m while the firm owes its directors €8.6m. Bank interest charges during the year totalled €5m.
The group's cash reserves increased during the year from €18.4m to €22.3m with its net assets increasing from €57.5m to €59.8m.
The numbers employed by the group last year increased from 658 to 663. That includes 594 bar staff, 46 bar managers and 23 back office staff.
The accounts show that the company's employment costs increased by 4pc to €14.76m. The firm's cost of sales reduced from €19.7m to €18.9m, with administrative expenses decreasing from €30.89m to €28.8m.
The accounts show the group banks with Irish Bank Resolution Corporation, Ulster Bank and AIB. Mr Fitzgerald could not be reached for comment yesterday.