A return to normal trading conditions following the lifting of tough public health restrictions saw the company behind the Conrad Dublin hotel bounce back into the black last year after losing more than €3.6 million in 2021. Despite strong demand, however, the directors of Earlsfort Centre Hotel Proprietors (ECHP) have warned that the hospitality sector’s recovery is still clouded by uncertainty and remains “susceptible to further shocks”.
The Earlsfort Terrace hotel, which housed US president Joe Biden and his entourage on his official visit to the capital in April, was in a “much stronger position” at the end of last year, the directors noted in a report attached to accounts filed recently for ECHP.
The hotel, which was sold to Dutch-anchored hotel investor Archer Hotel Capital in 2019 for a reported €118 million, generated profits of €2.5 million in 2022, a significant turnaround from its 2021 loss. Its cash reserves swelled from €4.6 million in 2021 to more than €11 million at the end of December last.
Despite a slow start to 2022 as the Government began to lift Covid-related public health restrictions, the directors said that “activity picked up later in the year as the desire and ability for guests to travel increased”.
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Turnover at the 175-bedroom hotel surged more than 360 per cent to €18.5 million, near pre-Covid levels, from €5.1 million in 2021 when the hotel was closed between April and July, reopening later in the year on a limited occupancy basis.
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Staffing levels at the hotel, meanwhile, almost returned to pre-pandemic levels after the company furloughed employees in 2020 and 2021.
ECHP employed 175 people at the end of last year, up from 117 in 2021 and just 88 in 2020 as it slashed its headcount and put 28 employees on temporary leave. As a result, the hotel’s wage bill doubled from close to €3 million in 2021 to more than €6 million last year. The Archer-owned company also availed of employment wage subsidy payments of €528,591, down from almost €1.5 million in 2021.
However, the directors noted that staff shortages and wage inflation were a feature in the year and the business has “continued to experience challenging business conditions”.
Looking ahead, they said the company’s 2023 projections “assume relatively limited growth in terms of room rates off the back of a strong 2022, with occupancies continuing to climb across the year and beginning to approach their previous levels”.
They said: “Demand is strong and business of the books is good but there is some uncertainty around the recovery curve for the hospitality industry as it remains susceptible to further shocks.”
