Balbirnie House Hotel in Fife has posted a loss of more than £180,000 despite booking more than 400 weddings in two years.
Directors at Balbirnie were forced to refinance to cover the debt, following forced closures during the pandemic, high energy bills and the cost-of-living crisis.
But bosses at the company remain convinced the Markinch business could rake-in £75 million over the next 10 years.
Not just that, but they hope, four financial years after the pandemic, next year’s figures will show a profit.
Newly filed accounts, for the year ending April 30 2023, show turnover of £4.41m – an increase of more than 23% on 2022.
The business made a pre-tax loss of £186,886, following a £7,363 loss in 2022.
Balbirnie House Hotel on costs of trading in Scotland
Managing director Nicholas Russell previously hit out at the lack of support for hospitality businesses by the Scottish Government.
He noted the costs of operating a hospitality business in Scotland far exceeded those by similar operations south of the border.
Mr Russell said his business had to arrange refinancing after its latest loss.
He said: “Fundamentally the costs of operating in the entire Scotland hospitality sector are now more extreme and more expensive than ever before.
“They are also now more expensive than operating in hospitality in England.
“We have had the ability to arrange new financing.
“So many hospitality industry colleagues have not been successful in these endeavours.”
Wedding bookings give optimism
Though the tough economic climate continues, Mr Russell said the “astonishing” number of wedding bookings gives him optimism.
He predicts the venue will make a profit in the current financial year.
“It is an astonishing set of statistics – during the 2022 and 2023 calendar years combined, Balbirnie House took bookings for 414 future weddings,” he said.
“While none of us has a financial crystal ball, we consider the future with optimism.
“For prospective future wedding clients making bookings for dates, there has to be a belief any business will be able to keep trading.
“Our focus on this is completely resolute and not just on keeping trading, but retaining the constant ability to be able to keep on reinvesting back into the fabric of the assets as well.
“The directors are optimistic based on current projections, and with management accounts showing a record-breaking first half of the 2023-24 financial year, that financial results to the end of April 2024 may show a return to profit.
“We suggest it is conceivable our company may now finally return to profit, four financial years after the negative financial implications of the pandemic lockdowns.
“We will therefore consider fast tracking production of our next annual accounts.”
Government moves
UK chancellor Jeremy Hunt extended 75% rates relief for hospitality businesses in England and Wales in the UK Government’s autumn statement.
The Scottish budget does not include the same business rates relief for the hospitality sector.
Finance secretary Shona Robison did announce a freeze to rates for premises valued at less than £51,000.
And 100% relief was offered to hospitality businesses on Scotland’s islands, but there was no support for other hospitality firms.