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Old Course Hotel reports £14m loss due to impact of pandemic

9.50am 5th October 2021 - Travel

The impact of the pandemic on revenues has been felt across the entire golf travel sector over the last 18 months, but few destinations have been affected more keenly than at the Home of Golf, St Andrews, with many businesses in the Scottish town relying almost entirely on golf tourism for their income.

While local golfers have still been able to play, and courses have been able to rely on a steady flow of membership renewals and green fee income from domestic golfers, the hotel sector has been especially hard hit, with millions of pounds worth of bookings from overseas visitors all but drying up before the most recent easing of restrictions. 

The Old Course Hotel, one of the most iconic golf hotels in the world, has been particularly hard hit, with revenues at the venue, which overlooks the Old Course, having fallen by more than £14 million in 2020, with continued losses into 2021.

According to a report published in The Courier, revenues dropped by 63% on 2019 figures, while turnover fell from £22.7 million to £8.3m for the year ending December 31, 2020. Old Course Limited, which also operates the Duke’s golf course in the Fife town, made a pre-tax loss of £7.1m for 2020, compared with a pre-tax profit of £233,000 in 2019.
The number of staff working at the venue fell from 455 in 2019 to 382, with a drop of 77 staff in hotel operations. The wage bill also fell by just over £1m from upwards of £6.7m in 2019 to £5.6m for the reporting period.

A spokesperson for the hotel said: “Our 2020 accounts reflect a difficult year through a global pandemic and where we have made a considerable investment into expanding and improving the hotel.”

The hotel is currently undergoing a multi-million pound makeover, which includes the introduction of a penthouse and new guest rooms. An additional restaurant and bar will also be formed, as well as refurbished events spaces.

Herb Kohler, CEO of Kohler Co, which owns 99.8% of Old Course Ltd, said: “Due to global uncertainty surrounding the UK’s exit from the EU, as well as Covid-19, the directors recognise potential risk in the recruitment and retention of casual staff in 2021 and beyond. The weakening pound presents a risk of increased costs to the company, but could also stimulate overseas tourist numbers visiting the UK.”

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