THE OPERATOR of the Conrad hotel in central Dublin, part-owned by developer Bernard McNamara, has warned of "difficult" market conditions in the current trading period after the business slipped into the red last year with pretax losses of €345,972.
Earlsfort Centre Hotel Properties, operator of the hotel, said in newly filed accounts that its financial plan forecast a profit this year in spite of the challenges faced by the sector.
The hotel declined to comment on the results yesterday.
Mr McNamara bought a 45 per cent interest in the Conrad from the Irish Shell pension fund and nominees of the Bank of New York in January 2007.
His other hotel investments in Dublin include an interest in the Shelbourne Hotel on St Stephen's Green.
One of his co-investors in the Conrad is Conrad International, a division of Hilton Hotels Corporation, whose parent is private equity giant Blackstone.
Hilton Hotels Corporation operates the Hilton Dublin hotel on Charlemont Place, which in separate filings reported a pretax profit of €69,648 last year.
While the Conrad made a pretax profit of €100,933 in 2006, it turned a pretax loss last year after interest fees of €1.03 million eroded an operating profit of €646,187. The operating profit in 2006 was €962,671.
Turnover declined last year to €14.82 million from €15.39 million in 2006.
"Trading conditions in Dublin were difficult with a combination of macroeconomic softening and increased competition.
"As a result, revenues in 2007 were behind 2006, primarily driven by softness in rooms revenues, where both occupancy and average rate were behind in 2006," said a note with the accounts.
"Difficult market conditions continue, with an environment of weakening global and domestic economies, a strengthening euro and diminishing consumer confidence."
It said independent research showed there was "a reduction in revenue per available room of 9.3 per cent for March year-to-date across the total hotel market in Dublin", and added that current market conditions "suggest 2008 will be challenging".
Accounts for Hilton Hotels (Ireland), operator of the Hilton Dublin, show that turnover rose marginally to €1.09 million from €1.06 million. The pretax profit last year came after a pretax loss of €334,846 in 2006. "We're not immune to the global environment. However, our trading remains sound," said a spokeswoman for the hotel operator.
