Irish catering and hospitality service provider Kylemore Services Group (KSG) saw profits slump to €112,000 last year from €778,000 a year previously, as its cost of sales almost tripled.
KSG Dining, the holding company for the group that operates commercial catering and restaurant and hospitality services in Ireland and the UK, saw turnover increase by 115 per cent in its latest financial year, to €70.2 million.
Financial accounts for the financial year to March 31st, 2023, show that some €65.6 million of the company’s turnover was in Ireland, while €4.56 million was in the UK.
KSG Dining is owned by DCC Group, chief executive Michael Gleeson and the Hogan family that originally founded the company in 1920.
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It provides catering services to employers such as Microsoft, KPMG, Accenture, MSD, Pfizer, Deloitte and William Fry Solicitors, as well as operating restaurants, cafes and bars in locations such as Dublin and Cork Airports, UCD and UCC, Liffey Valley Shopping Centre and Swords Pavilions Shopping Centre.
In a report accompanying the accounts, directors said the increase in turnover last year was due to the full reopening of trading activities following Covid-19 restrictions, as well as the commencement of a small number of new client contracts.
However, the company’s profit after tax last year was €112,000, down from €778,000 in 2022.
The cost of sales for the company was €57.37 million in 2023, almost triple a sales cost of €20.91 million a year previously.
KSG Dining directors said that the company “performed satisfactorily” during the year as operational activity ramped up, and managed the impacts of labour resourcing ability and food inflation.
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“The directors remain optimistic with regard to the trading outlook and the further development of profitable growth and expansion opportunities,” they said.
Inflation was among the principal risks to the business listed by directors, but they said that the KSG group works with its supply partners and procurement team to manage supply chain and food inflation.
In 2022, “due to prevailing economic conditions”, KSG Dining made provision of €1.12 million for losses on onerous leases relating to retail sites of one of its subsidiary companies, which were due to expire within five years. The company utilised €405,000 of this in the latest financial year, leaving it with provision of €715,000 by March 31st, 2023, for expiration of retail leases.
The company saw staff numbers rise from 1,090 in 2022 to 1,279 in 2023. Its total wage and salaries bill was €30.32 million last year, 1 per cent of which was funded by Government wage supports. In 2022, the company’s total wage bill was €10.93 million, with 45 per cent funded by Government supports.
KSG Dining paid no dividend in the financial year to March 31st, 2023, but its directors have approved an interim dividend of 28.5 cent per ordinary share in the current financial year.
KSG was contacted for comment.
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