K Club expects to incur further losses and has submitted business plan

THE MICHAEL Smurfit-backed K Club expects to lose money this year and has submitted a business plan, according to its latest accounts.

Accounts for Bishopscourt Investments, the company that owns the golf and country club in Straffan, Co Kildare, which hosted the Ryder Cup in 2006, show that it lost €6.5 million in 2009.

While the latest accounts filed by the company only cover 2009, the notes accompanying them say that it continued to lose money through to the end of October 2010.

The notes state that, based on further projections, it expects to incur further losses this year.

Nama took over its €55 million bank loan last year. The accounts state that the debt is repayable on demand as Bishopscourt failed to meet interest and capital repayments that were due on it.

The company submitted a business plan to Nama last year. The plan assumes that the loan will remain in place and the directors, including Mr Smurfit, say that they have prepared the accounts on the basis that the State agency will not call in the loan.

The accounts show that its total debts come to €80 million. This figure includes a €5.4 million shareholders’ loan, which is repayable on demand and carries interest. Mr Smurfit and property developer Gerry Gannon are its ultimate shareholders.

According to recent reports, Mr Smurfit has told Nama that he was willing to buy Mr Gannon’s 49 per cent stake in the club.

The pair bought it from the Smurfit Group – now part of Smurfit Kappa – for €115 million in 2005.

In 2009 the club had revenues of €14 million and its operations made a €4.6 million loss. Interest charges of €1.9 million boosted this to €6.5 million.

The golf course hosted the Ryder Cup in 2006, and has regularly hosted the European Open.