Supermac’s goes large as profits double
Founder Pat McDonagh completes windfall by selling property worth €27m to company
Supermac’s on O’Connell Street, Dublin: After-tax profits at the group doubled to €14 million last year.
Profits have spike have spiked at the group owned by Galway entrepreneur Pat McDonagh and his wife Una that comprises the Supermac’s fast food chain, hotels and property investments.
After-tax profits doubled to €14 million last year at Supermac’s Holdings, according to accounts recently filed, while revenues rose by 24 per cent to €116 million as it expanded its hotel operations and consumer spending rose.
Mr McDonagh says he expects the fast food chain’s revenues to grow by a further 4.5 per cent this year, although growth tailed off in the second half of 2016 after an “excellent” first six months.
The accounts confirm Mr McDonagh and his wife last year netted a major windfall by selling to the business 18 Supermac’s outlets they personally owned for €27 million.
The company borrowed to pay them about €17 million for the properties over the year, with a further €10 million still owed at year end, the accounts reveal. The McDonaghs retained ownership of a further 12 outlets but could yet sell those to the company.
Mr McDonagh’s empire includes 107 Supermac’s outlets – 34 of them operated by the company with the rest franchised – as well as the Killeshin hotel in Laois, Castletroy Park hotel in Limerick, the Charleville Park in Cork and Lough Rea hotel in Galway.
Having built his hotel empire in the recovery, he says he now “has a feel” for the sector and is interested in making further acquisitions.
He also runs motorway service stations and owns the Irish master franchise for Papa John’s US fast food brand, as well as a chain of 10 pubs in the midwestern US called Claddagh Irish Pubs.
The revenues and profits from the pubs, however, are not included in the financial statements. Mr McDonagh said it was a “poor year” in the pub and restaurant business in the US, which he attributed to the presidential election.
Mr McDonagh and his wife, who own the business on a 50/50 basis, now employ more than 1,300 staff, not including the employees of Supermac’s franchises. The balance sheet for the group suggests shareholder equity of about €72 million.
The businessman is attempting to expand his portfolio of motorway service stations, with a renewed bid to obtain planning permission for a major complex off the M18 near Ennis in Co Clare.
His first attempt in Ennis was rejected by An Bórd Pleanálá earlier this year. Clare planners have in recent weeks sought further information on a second application, submitted in September.
Mr McDonagh already operates a service station off the M6 in Galway, as well as the “Obama Plaza” off the M9 in Offaly . He joked last night he might open a “Trump Plaza” in Ennis, if he gets planning permission.
“It’d make a nice stop on the way to Doonbeg,” he said.