THE TWO Fitzpatrick hotels in New York made a pretax profit of $2.7 million (€2.1 million) last year, according to accounts seen by The Irish Times.

This was down 60 per cent on the record $7 million profit booked by Fitzpatrick Hotels Ltd in 2008 and reflects the impact of the recession and the global credit crunch on bookings at the group, which is owned by well-known Irish hotelier John Fitzpatrick.

The accounts show that Fitzpatrick’s turnover in the year to the end of September 2009 fell by 19 per cent to $21.8 million.

This reflected a significant decline last year in spending by business travellers, a drop-off in visitor numbers and significant price competition.

Its cost of sales was flat at just more than $1 million while administrative expenses nudged up slightly to $17.4 million. This left the hotel group with an operating profit of $3.5 million last year, compared with $8.9 million in the previous 12 months.

The hotel group’s interest bill halved to $1.3 million last year while the interest received declined to $550,000 from $876,000 in 2008.

As a result of the reduced profitability, Fitzpatrick’s tax bill was reduced to $600,000 last year from $2.6 million in the previous 12-month period.

Mr Fitzpatrick told The Irish Timeshe was satisfied with the results given the difficult economic backdrop that faced the hotel industry in New York last year.

“We are doing well in a tough climate. In fact, we outperformed the New York market in occupancy and rate, and I am glad to say that we made a good profit,” he said.

“The positive news is that we have seen a significant turnaround in the past four months in the US with a pick-up in corporate travel.”

Mr Fitzpatrick said the company was budgeting for a “slight increase” in its sales in the current financial year. Fitzpatrick Hotels achieved an average room rate last year of $242. This was 15 per cent down on 2008 but ahead of the average rate of $226 achieved in New York as a whole.

In terms of occupancy, Fitzpatrick filled 80 per cent of its rooms last year compared with 85 per cent in 2008. The average for New York in 2009 was 76.6 per cent.

Mr Fitzpatrick, who is chairman of the Hotel Association of New York City, owns the 91-bed Manhattan hotel and the 155-bed Grand Central property in New York. The hotels, which are popular with Irish visitors to the city, have been refurbished in the past couple of years at a cost of more than $9 million.

The New York hotels are wholly owned by Mr Fitzpatrick. The Fitzpatrick Castle in Killiney, Co Dublin, is owned by his sister Eithne.