An Irish subsidiary of the Compass Group, the world's biggest catering company, reported a pre-tax loss of €1.54 million last year, just 12 months after recording profits of €4.6 million, according to newly filed accounts.

The reversal came despite a 10 per cent rise in turnover at Compass Catering Services Ireland to €94.35 million in the 12 months to September 2014.

Administration expenses more than doubled from €5 million to €11.1 million over the year. The single largest element of the increase in costs was payment of group franchise fees of €4.8 million which, it is understood, cover a number of prior years.

The group also wound up its defined benefit pension scheme in July 2014. As a result, it recorded a curtailment gain of €3.52 million but an actuarial loss of €1.35 million.

Compass said it remained optimistic about its future prospects, despite difficult trading conditions.

The directors, which include managing director Fiacra Nagle and finance director Paul Galvin, did not recommend the payment of a dividend to its multinational parent.