Losses grew by 40 per cent at the Dublin outlet of upmarket wine merchant Berry Bros & Rudd last year, climbing from €416,782 to €585,759.

The higher operating losses came as sales increased by 27 per cent from €2.4 million to slightly more than €3 million in the year to the end of March, according to accounts filed with the Companies Office.

The increased sales came as wine consumption in the Republic touched a new high. Data collected by the Central Statistics Office and the Revenue Commissioners showed that wine accounted for 19.3 per cent of the alcohol market in 2004.

Research company Mintel found last month meanwhile that pubs are losing market share to off licences, as consumers' become happier to drink in their own homes.

While Berry Bros & Rudd's directors did not comment on trading in the accounts, a breakdown of the results shows that the firm faced significantly higher distribution costs and administrative expenses over the past year.

Distribution costs in the 12 months to the end March amounted to €474,513, up from €366,755 in the previous year.

Administrative expenses meanwhile rose from €668,658 to €744,752 over the same period.

The directors of the Irish company did not recommend a dividend in the year to the end of March. The firm's balance sheet for the end of its financial year shows that it had net liabilities of €250,951, compared to net assets of €295,813 a year earlier.

Notes to the results show that at March 31st, the Dublin company owed €1.7 million to its London parent. The Irish operation bought goods worth €1.26 million from its parent over the year.

The firm had 10 staff, down from 12 but employment costs nonetheless climbed, increasing by 18 per cent from €474,278 to €561,990.

Directors' pay, listed separately, fell by 8 per cent from €165,000 to €152,357. In the year to March, directors also received pension contributions of €23,571, which was more or less flat on the previous period.

Berry Bros & Rudd's Dublin operation was founded in 1999 in the former Weights and Measures building in Harry Street, near Grafton Street.

Like its long-established London-based parent, the outlet specialises in fine and rare wines and sells a number of varieties under its own label.

It caters both to retail and hospitality clients, and has a private dining area in its premises that is available for hire.