Hotel chief calls for Shannon area fund

The managing director of one of Ireland's best known hotels has called on the Government to provide a marketing fund for the Shannon region to compensate for the loss of the Shannon stopover.

Dromoland Castle managing director Mark Nolan made the call yesterday as accounts returned to the Companies Office show that profits at the five-star hotel dropped last year by 28 per cent. According to the accounts, the hotel's profit before tax dropped from €1.4 million in 2005 to €1 million last year.

The main factor behind the drop is the "exceptional expense" of €342,000 paid out in redundancy and severance costs during 2006.

More than 80 per cent of the hotel's client base from April to September is US-based. Mr Nolan said: "The silence from Government on the need for a clear marketing strategy is a real concern."

The accounts show operating expenses at Dromoland Castle increased by €500,000 last year to €9.7 million - more than the increase in turnover, which rose about €300,000 to €11.2 million. Costs include a payment of €366,000 to a company controlled by Mr Nolan, Hallmarket Management Ltd.

Hallmark is paid a consultancy fee for the management services it provides. The payment is down on the €504,000 the company received in 2005.

The hotel's 30 investors received a dividend of €300,000 between them - the same amount as in each of the previous two years.

Mr Nolan has a share of 2 per cent in the business, while Sir Anthony O'Reilly has a share of just under 25 per cent. The remainder of the shareholders are US based.

Net profit after tax and the dividend pay out of €500,000 brought accumulated profits to €10 million.