London's Ritz hotel nearly doubled its losses last year as the Iraq War depressed the number of wealthy tourists visiting the capital.
The five-star property recorded a pre-tax loss of more than £1m in 2003, compared with a loss of £540,000 the year before.
Operating profit tumbled to £1.7m (from £4m in 2002) while turnover dropped to £16.9m, from £17.5m in the previous year.
However, owner Ellerman Investments, the property and hotels business set up by the reclusive Barclay brothers, said that trading at the hotel had shown "a considerable improvement" since the start of 2004.
It believes the hotel's value has risen from £150m in 2001 to £175m today.
The Ritz Club Casino, which operates in the hotel's basement, also suffered a decline in profitability. Pre-tax profits slid from £7.9m to £6.3m, although gaming turnover remained unchanged at £31.69m.
Ellerman is entitled to a royalty income from the club for the use of the Ritz name. This entitlement is valued at £4.5m.
Operating profit grew by £300,000 to £500,000 while turnover was unchanged at £4.4m.
by Angela Frewin
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