Trust to keep up donations

The Invercargill Licensing Trust plans to shell out $10 million in community grants during the next two financial years and press on with a massive works programme despite the deepening global recession.

Trust general manager Greg Mulvey said the economic downturn was already being seen in a drop in forward bookings for accommodation and conferences but donations for 2008-09 would still be on par with the record amounts given out during the past three years.

While off-premise liquor sales were down by $151,000 for the five-week period to January 4 and $17,000 for the three week period to January 25, total sales for the nine months to the end of December were $1.2 million higher than in the previous year.

Mr Mulvey said the recent drop in sales was because of a decline in off-premise liquor sales that had been partially offset by a small increase in other areas.

The trust aimed to end the financial year in a similar position to 2007-08 when it posted a consolidated post-tax profit of $11.7 million despite a weakening fourth quarter, but this was not expected to continue through to 2009-10.

The expected drop in profitability would not be significant enough to impact on the trust's plans to give out $10 million in the 2009-10 year, Mr Mulvey said.

"I believe we will still be in a position to pay out $10 million," he said.

The trust board had reviewed a work programme estimated to be $12 million in light of the changing economic climate but had elected to move ahead.

The investment was long-term and would meet demand in the future and the money spent on the projects would help stimulate the economy during the downturn, he said.

The projects include construction of between 20 and 25 luxury apartment-styled rooms to complement the existing hotel and motel rooms at the Ascot Park Hotel; a new inner-city entertainment bar aimed at the under-30s; a revamp of the Northern Tavern, with an emphasis on dining, and the demolition of the Southland Tavern for a new bar to be built.

- © Fairfax NZ News