Donald Trump’s Turnberry resort posts losses of £2.3 million
Donald Trump’s flagship overseas property at Turnberry has posted annual losses of £2.3 million, marking the sixth year in a row it has failed to turn a profit under his ownership.
The property, the jewel in the crown in the Trump Organisation’s international property portfolio, recorded record turnover, but did not register a profit due to depreciation and amoritisation costs, as well as ongoing capital expenditure.
The new filings, posted at Companies House, cover the 12 months to 31 December 2019, and do not reflect the widespread disruption to Turnberry’s business brought about by the coronavirus pandemic.
But they show that since the outgoing US president took over the historic property in 2014, its losses now total nearly £45m.
It comes just days after accounts for Mr Trump’s inaugural Scottish resort in Aberdeenshire posted losses of £1.1m, the eighth consecutive year it has been in the red.
The latest losses for Turnberry are based on a record turnover of £19.66m. The previous year’s accounts registered losses of £10.77m on turnover of £18.41m.
The new accounts show that £4.86m in losses were registered through depreciation and amoritisation, which prevented it from registering its first profit under Mr Trump’s ownership. The depreciation charge of £3.79m was caused by the transfer of assets classed as ‘under construction’ during Turnberry’s latest refurbishment. The accounts also state that £2.68m was spent on ‘fixed asset additions’.
The property’s record losses for a single year were £17.6m, posted in 2016, during which time it was partially closed to allow for refurbishment works.
The fact Turnberry remains in the red comes in spite of significant tranches of payments it has received from the US government during Mr Trump’s single term in office.
Last autumn, Scotland on Sunday revealed how the US Secret Service spent nearly £25,000 to accommodate its agents at the resort during business trips by Mr Trump’s son, Eric, an executive vice-president of the family firm. Since Mr Trump’s election, the property has received close to £300,000 from the Secret Service, US State Department, and US Defence Department, according to an ongoing analysis of payments by The Scotsman.
The new accounts show that Turnberry’s corporate entity, Golf Recreation Scotland, owes £113.4m to its ultimate parent company, the Donald J Trump Revocable Trust, down slightly from £114.9m in 2018.
Companies House filings show that Donald Trump Jr and Allen Weisselberg, the Trump Organisation’s veteran chief financial officer, are classed as persons with “significant control” of Golf Recreation Scotland.
The cost of sales rose from £11.5m to £12.2m over the same period. Administrative expenses were unchanged at £7.1m.
In his director's report accompanying the accounts, Eric, the firm's sole director, said Turnberry had “clearly established itself as Scotland’s premier destination for luxury travel, championship golf, and special events,” and that “additional planning for further redevelopment” of the resort was ongoing.
Addressing the Covid-19 crisis, his report also notes that Turnberry was been closed for 17 weeks throughout 2020, and describes the “severe impact” on the golf, leisure, and hospitality industry as “unprecedented.”
It goes on: “The extent of the impact of Covid-19 on the company’s business and financial results will depend on the duration and spread of the outbreak and the related impact on consumer confidence and spending, all of which are highly uncertain in the current environment.
"Compounded by the uncertainty of Brexit anticipated in 2021, the hospitality sector is globally is facing unprecedented challenges.”
Mr Trump’s company has been thwarted in its attempts to expand Turnberry in recent years. As revealed by The Scotsman last summer, the Trump Organisation commissioned a detailed masterplan to develop what it described as a “world class coastal retreat” on farmland adjoining the 115 year-old resort’s celebrated golf courses.
Despite a lavish presentation outlining the expansion - which proposed as many as 225 properties, as well as leisure facilities and shops - the land in question has not been rezoned as part of South Ayrshire Council’s new local development plan, a local authority-wide planning framework.
Instead, the Trump Organisation has focused on overhauling Turnberry’s spa and pursuing a new outdoor activity centre. However, the advent of Covid-19 has significantly disrupted the business in recent months.
Trump Turnberry and the Trump Organisation have been approached for comment on the latest accounts.
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