The five-star Ashford Castle Hotel is building a staff accommodation block with 45 rooms on its Cong, Co Mayo, estate for between €1.5 million and €2 million.
Speaking to The Irish Times, Niall Rochford, Ashford's general manager, explained the investment comes due to the difficulty with keeping staff.
“We’ve just started building a 45-bedroom staff accommodation block. One of the biggest challenges we have is recruiting and retaining talented staff,” he said.
The accommodation block, which will include a gym, will be for those staff “who need it”. “If we’re trying to attract staff from all over the world we need to have good accommodation for them to enjoy,” Mr Rochford said.
The general manager was speaking after the company recently lodged accounts showing an operating loss of €2.38 million in 2016.
The hotel, once voted the best in the world did, however, significantly reduce its operating loss from €21.9 million the previous year as it dealt with impairment costs having completed a significant upgrade in 2015.
“We’re making great strides towards profitability,” Mr Rochford said.
“In saying that, the owners want to make sure this is operating at the best quality and international standards as possible – along with that comes significant costs.”
The operational side of the business was challenged in 2016 as restoration works continued, according to a director’s note. Although the company says it was “encouraged” by the 52 per cent increase in revenue from €11.7 million to €17.86 million.
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When the €18 million cost of sales, €2.2 million in administrative expenses and €1.13 million in finance costs are factored in, the total after-tax loss for the year amounted to €3.5 million – again significantly down on the €23 million after-tax loss in 2015.
Staff numbers at the 365-acre Cong, Co Mayo, estate increased from 212 in 2015 to 256 last year while payroll costs upped by almost 30 per cent to €6.75 million.
Following the $75 million (€64 million) upgrade of the 800-year-old castle, the company owes a group undertaking, Trafalgar Financial Services Limited, €56.5 million.
Meanwhile, Ashford is owed €3.9 million from another group company, The Lodge at Ashford Castle Limited, which controls a 50-bedroom property formerly known as Lisloughrey Lodge. That property was acquired by the South African owners of Ashford, Red Carnation Hotels, in 2014 for an undisclosed sum.
The Lodge, Mr Rochford said, has been a worthwhile purchase and they’ve transformed its use so that it appeals to the “US traveller who may not be able to afford Ashford but still wants to stay on the estate”.
Reputation
In terms of future outlook, Ashford cited Brexit as one of its principal risks, although it is “closely monitoring” that risk and will amend its business if necessary to “maintain the group’s standing and reputation in the marketplace locally”.
Mr Rochford said the hotel's performance so far this year has seen continually improving occupancy and rates doing "extremely well". He said the hotel will increase rates in 2018 as "Ireland is seen very much in vogue right now for the international traveller".
In a going concern note, the directors say the company’s ultimate parent undertaking, the British Virgin Island incorporated Travel Corporation Limited, “will continue to provide ongoing financial support”.
On the back of its loss in 2016, Ashford’s directors didn’t recommend a dividend payment to its parent company.
