Lyrath hotel made loss of more than €1m in 2009

LYRATH ESTATE Hotel made a loss of more than €1 million in 2009, documents filed by its auditor disclose.

As a private unlimited company, Lyrath Estate Hotel does not have to provide accounts to the Companies Office. However, net losses before tax of €1,063,244 are confirmed by its Tralee-based auditors, Kelly Foley Co, in a two-page report filed with the office.

The report states the loss “along with other matters explained in Note 1 to the financial statements indicate the existence of a material uncertainty, which may cast significant doubt about the company’s ability to continue as a going concern”.

In reports for prior years, the auditors confirm a pretax loss at the hotel of €654,526 in 2008 and €358,390 in 2007. Separate accounts for a connected company, Lyrath Demesne Ltd, show it recorded a loss of €4 million in 2009 due to a writedown in the value of land.

However, Kerry businessman Xavier McAuliffe, who opened the €50 million hotel complex in 2006, believes it will make a profit for the first time in 2011.

The hotel’s general manager, Patrick Joyce, said: “Myself and Xavier strongly believe that we will turn a profit in 2011. We are very positive about the future. The hotel has a great location and a great reputation.”

Speaking yesterday, he disclosed the hotel had also recorded a loss last year, but said losses for the first five years of operation had always been anticipated.

“We have been looking pretty much on track – 2009 was a little bit worse and 2010 better than we thought, so across the board.”

On the auditor’s comments, Mr Joyce said: “It is their duty where there is a book loss to comment on the going concern. I don’t believe Xavier or myself came into the business thinking we are going to be turning a profit in the first three years. It simply doesn’t happen.”

He said: “There is certainly a very viable business here. We are strongly focused on making a profit in 2011. I don’t want to be running a business that is making a loss. Nobody does.”

Mr Joyce acknowledged the loss in 2009 was “slightly higher than we envisaged but I think the severity of the global financial downturn came as a shock to everyone”.

“We had a superb 2008 and we had a reversal for 2009. 2010 has been a lot more positive, where we would envisage a cash loss of €100,000.

Mr Joyce said this compared to a cash loss of around €500,000 in 2009.