A FROTHY increase in turnover failed to keep publican brothers Liam and Des O’Dwyer out of the red last year.

Accounts just filed for Toji Holdings Ltd, the holding company of their Capital Bars chain, show that turnover rose to €60.3 million in the year to the end of September 23rd, 2007. This was up from €40.3 million a year earlier.

Most of this jump was the result of a gain of €18.9 million on the sale of a “developed property”.

Sales from its bars, hotels and restaurants – which include the super pubs Cafe en Seine and Zanzibar, and the Trinity Capital Hotel – amounted to just shy of €39 million, compared with €37.6 million in 2006. Income from its waste management operations declined slightly to €2.6 million.

The improved revenue performance didn’t prevent the company from slipping into the red.

Toji reported an after-tax loss of €2.5 million last year, almost twice the deficit in 2006. The loss came after it paid rents of €6.1 million, including €2.6 million to the O’Dwyer brothers.

Toji also incurred a loss of €836,000 on the temporary closure of a unit and had to pay €4.6 million in interest costs.

The company balance sheets shows a deficit on shareholder funds of €3 million relating to almost €6 million in write offs in 2005 and 2007. Its net debt at the year end was a hefty €120.7 million.

The O’Dwyers have continued to refocus the business over the past year. The Bobs and Dandelion venues were offloaded, while the group expanded the Trinity Capital Hotel and gained planning permission to proceed with a €100 million, 309-bed hotel at Abbey Street in central Dublin.

The move away from super pubs to three-star hotels appears to have been justified. Sales in its bars in the 42 weeks to the end of July 15th 2008 were described as “flat”, while its hotel businesses are up 11 per cent over the same period, helped by the extension of the Trinity Capital.