Losses almost triple at Cork Opera House

RESTRUCTURING COSTS totalling €371,099 contributed to losses at Cork Opera House almost tripling last year to €825,282.

According to accounts just filed with the Companies Office, revenues at Cork Opera House plc decreased by 21 per cent from €4.88 million to €3.84 million in the 12 months to the end of March 31st last.

The chief factor behind the drop in revenues was the venue’s decision to close for three months in summer 2010 to stem operating losses during what is traditionally a quiet period, according to the accounts.

A strategic review was undertaken during this closure, and on completion a five-year business plan was prepared.

A report by opera house chairman Damien Wallace confirmed it had cash-flow difficulties in May 2010, resulting in it seeking the assistance of Cork City Council.

As a result, the city council sanctioned a loan of €1.25 million to the opera house to help secure its future.

The local authority also guaranteed a €1.5 million Bank of Ireland loan to restructure the opera house’s existing short terms loans, and an outstanding city council loan of €857,073 was converted to a non-repayable capital grant.

In his report, Mr Wallace said Cork Opera House now had a strong balance sheet and was in a position to meet its financial commitments. “Overall, I am confident for the future.”

Numbers attending the main auditorium declined from 167,324 attending 266 performances in fiscal year 2010 compared to 127,557 patrons attending 204 performances last year.

The restructuring contributed to the number employed by the venue last year decreasing from 78 to 53, with staff costs decreasing from €1.9 million to €1.1 million.

The restructuring costs totalling €371,099 were made up of redundancy, professional and other costs.

The loss last year included a non-cash depreciation cost of €640,723. Accumulated losses were €3.1 million at the end of March last. Shareholder funds totalled €2.5 million that included €817,080 in cash.

Funding from the Arts Council declined from €228,600 to €48,800. Losses before the exceptional cost of €371,099 increased last year by 58 per cent from €286,346 to €454,183.

Mr Wallace said the implementation of the strategic plan combined with a more varied and attractive programme were already beginning to show positive results, and would ensure that the opera house could eliminate its deficit, return to an annual surplus and begin to repay the funds loaned from Cork City Council.

In her report, Cork Opera House chief executive Mary Hickson said that financial issues dominated the psyche and public image of opera house when she took on the role in October 2010.

As a result, staff morale was at an all-time low and the impact of the recession “biting our patrons, our business and our attitudes was overwhelming”.

Ms Hickson said staff morale at the opera house was now very good.“There is still a lot of work to be done to achieve the potential of COH. We are getting through it with energy and enthusiasm.”

She said that tribute bands were the main programme attraction and were not selling.

Under Ms Hickson’s direction, the opera house decided to have no tribute bands for 12 months, and have an opera in every programme for the first 12 months.

“Each and every one of us appreciates what COH represents for the public of Cork, and we will strive to lift it to the place it deserves within the cultural infrastructure of Ireland,” she said.