The sale of development lands in Berlin helped to deliver profits of over €50m for FBD Holdings during 2020 and offset a serious downturn in group’s hotel revenues.

The sale of development lands in Berlin helped to deliver profits of over €50m for Farmer Business Developments during 2020 and offset a serious downturn in group’s hotel revenues.

The disposal of the Berlin development land by the group’s subsidiary, Bulberry Properties, generated €97.72m in total, with the final phased payment of €20m received in January this year.

Overall, Farmer Business Developments posted a profit of €50.69m in 2020 — well up from the €16m recorded in 2019.

However, this performance was underpinned by the Berlin land sale, as revenues from the group’s hotel businesses collapsed as a result of the Covid-19 crisis.

According to the group’s 2020 annual report, the Bulberry Properties sale delivered €21.76m for the company, repaid €14m to minority shareholders, and repaid €16.57m in external debt.

This cash injection more than compensated for the sharp fall in income from Farmer Business Developments’ hotel business.

While revenues of €13.7m were delivered in 2019, the hotel and resorts business recorded losses of €1.6m last yearas Covid-19 decimated the hospitality sector globally.

Turnover

The extent of the downturn was reflected in level of tTurnover from the group’s hotels and resorts fell from €63.7m to €24.5m between 2019 and 2020.

Farmer Business Developments owns three hotels in Ireland — The Heritage outside Portlaoise, Faithlegg in Waterford, and the Castleknock Hotel in Dublin — as well as and two resorts in southern Spain: La Cala and Sunset Beach Club.

Meanwhile, the group’s investment portfolio delivered €1.7m in profits, after recording a loss of €570,000 in 2019.

Farmer Business Developments’ chairman Padraig Walshe said the group’s “confidence and patience in Berlin” had been rewarded with “handsome returns”.

The company report pointed out that shareholders’ funds had increased by almost €10m to €228m in 2020, while bank debt had fallen from almost €70m to €57m.

Although the hospitality industry is expected to recover strongly through the second half of 2021 and into 2022, FBD holdings said it was still too early to predict the pandemic’s long-term impact on revenues.

However, the group insisted that it had a strong balance sheet and “significant headroom on its banking facilities” to deal with the difficulties.