The Porterhouse Group has returned to profitability despite a notable dip in overall earnings following the strategic divestment of its brewing operations. New consolidated accounts for Wavecrest Inn Ltd—the entity operating the Lost Lane site near Dublin’s Grafton Street—reveal a pre-tax profit of €511,244 for the 12 months ending February of last year.
The return to the black comes as the company navigates a transition in its business model. Total revenues fell by 6%, sliding from €28.63m to €26.77m. This decline is directly linked to the fact that the Porterhouse takes revenue hit after sale of brewery to Conor McGregor, a deal finalized in 2023 that removed a significant consistent income stream from the group’s books.
Elliot Hughes, a director at the Porterhouse Group, clarified that the brewery typically contributed between €3m and €4m in annual revenue, though that figure had seen some fluctuation prior to the acquisition by the former UFC champion. By offloading the production side of the business, the group has shifted its focus more heavily toward its hospitality and retail footprint.
Balancing the Books: Revenue Shifts and Profitability
While the top-line revenue decreased, the group managed to optimize its operational costs and leverage growth in its core hospitality offerings. The consolidated accounts, which cover a portfolio including Tapped, Hartys, and the Porterhouse Temple Bar in Dublin, as well as a London-based pub, show a diversifying revenue stream where food sales are beginning to offset some of the losses in beverage volume.
Specifically, “drink sales” saw a decrease from €26.04m to €23.99m. Conversely, food sales grew from €2.58m to €2.78m, suggesting a stronger push toward a full-service dining experience to attract patrons. Mr. Hughes noted that overall business has remained strong, with continued growth across both food and drink sectors within the bars over recent months.
| Metric | Previous Period | Current Period |
|---|---|---|
| Total Revenue | €28.63m | €26.77m |
| Drink Sales | €26.04m | €23.99m |
| Food Sales | €2.58m | €2.78m |
| Staff Costs | €5.82m | €5.58m |
| Pre-tax Profit | N/A | €511,244 |
The group’s bottom line was further influenced by non-cash depreciation costs totaling €702,932. After accounting for a corporation tax charge of €208,594, the group recorded a post-tax profit of €302,650. As of February 2025, the group maintained shareholder funds of €19.54m, which includes accumulated profits of €15.8m, though cash reserves dipped from €3.49m to €2.49m.
Consumer Trends and the ‘Late-Night’ Recovery
The group’s current success is anchored in a mix of global staples and local favorites. According to Mr. Hughes, the most popular products continue to be Guinness, the group’s own branded beers, and Dingle gin and vodka. The demand for these products has risen in tandem with a recovery in late-night trade, which has provided a necessary boost to the bars’ margins.
Interestingly, the group is also seeing a slow but steady rise in the “sober curious” movement. Non-alcoholic drink sales now account for approximately 2-3% of total drinks sales. While a small fraction of the rest of the portfolio, this segment is described as continuing to grow, reflecting a broader shift in European drinking habits toward moderation.
Our bestselling products have generally been Guinness as well as our own beers, and Dingle gin and vodka
Operational Headwinds: Labor and Energy Costs
Despite the return to profit, the Porterhouse Group is operating within a challenging macroeconomic environment. The hospitality sector in Ireland and the UK is currently grappling with a “perfect storm” of rising fixed costs that are becoming increasingly difficult to pass on to the consumer through price hikes.
Mr. Hughes identified three primary pressures on the business: the rising cost of staffing—specifically citing minimum wage increases, sick pay, and mandatory pension enrolment—as well as volatile energy costs. These factors have put significant pressure on the group and its peers across the industry.
To mitigate these costs, the group has managed to slightly reduce overall staff expenditures, which fell from €5.82m to €5.58m over the last year. However, the ability to maintain this lean operation while ensuring quality service remains a central challenge for the management team.
The Broader Impact of the Brewery Sale
The decision to sell the brewery to Conor McGregor represents more than just a financial transaction; it is a strategic pivot. By removing the capital-intensive burden of production, the Porterhouse Group has effectively lowered its risk profile and freed up management focus to optimize the “front of house” experience. While this resulted in the Porterhouse takes revenue hit after sale of brewery to Conor McGregor in the short term, the resulting pre-tax profit suggests that the remaining business is more efficient.
The group’s geographic footprint also provides a hedge against localized economic downturns, with €21.26m in revenue generated in Ireland and €5.5m coming from other European operations, primarily its London presence.
Disclaimer: This article is provided for informational purposes only and does not constitute financial or investment advice.
The company’s next major financial checkpoint will be the filing of its next set of consolidated accounts, which will reveal whether the growth in food sales and late-night beverage trade can fully compensate for the loss of brewery revenue in the long term.
We invite readers to share their thoughts on the evolving landscape of the Dublin hospitality scene in the comments below.
