Inverness arts venue Eden Court has posted significant losses following rising costs and reduced donations.
Newly filed accounts show losses of £889,271 for the 2022-23 financial year, compared to profits of £41,878 in 2021-22.
The Bishops Road charity said a “significant reduction” in funding and utility costs tripling are contributing factors.
Ticket sales have not covered the increased costs.
The accounts show income fell by £73,563 to £6,620,271 despite it having its most financially successful pantomime on record.
Meanwhile expenditure rose by more than £850,000 in the year March 31 2023.
Eden Court plans to limit financial damage
Eden Court said it will use reserve funds to run the facilities after ticket sales failed to return to pre-pandemic figures as quickly as hoped.
It closed its restaurant last year in a bid to reduce the financial black hole.
Chief executive Rebecca Holt said: “At the time we were responding to a financial deficit of around £1 million.
“Through the actions taken we were able to significantly reduce this shortfall. However trading conditions do continue to be challenging.”
Ms Holt said the charity is continuing to look for ways to cover its increasing cost base whilst keeping tickets affordable.
Eden Court has an agreement with Creative Scotland until 2025 receiving £500,000 a year. In the 2022-23 financial year it received additional funding of £242,000.
It also receives £300,000 a year from Highland Council which is expected to remain the same this financial year.
Drop in income and donations
While donations dropped £68,189 to £472,617 from £485,806, the chief executive said donations remain above pre-pandemic levels.
However, the cost-of-living crisis has had a negative impact in the past 18 months.
Ms Holt said: “We know that many people were inclined to donate to local causes including Eden Court during the pandemic, which is reflected in the 21/22 results.
“The subsequent cost-of-living crisis has not made this as possible for people over the last 18 months.
“Donations still remain above pre-pandemic levels illustrating the value that people place on Eden Court even when times are financially tough.”
The arts venue retains 20% of ticket sales income with the rest shared between visiting companies.
All of Eden Court costs have risen, says chief executive officer
Ms Holt said the increase of utility and wage costs were the most significant of all rises at the firm. The company’s total expenditure rose to £7.5m from £6.7m the previous year.
She said since March 2022 gas prices have risen by 232% as well as a 107% increase in electricity costs.
Ms Holt said: “All of our costs have increased. The most significant are utility costs and wage costs.
“Gas and electricity prices have risen – the annual impact of which increased costs of £215,000.”
Eden Court, which employs 140 staff, expects salaries will increase by another 10.1% this year.
Ms Holt added: “We are proud to commit to paying staff fairly. However the impact of this is an increase to the wage bill of over £300,000 within two years.
“We are lucky and grateful to receive public funding but this has remained at a standstill while these prices have increased.”
The shows will go on
Ms Holt said Eden Court will continue to be ambitious as it looks to welcoming more visitors.
She said: “In 2022-23 we welcomed 150,000 visits for live performances, 45,000 visits to our cinema and 8,000 visits to our creative studio classes.
“In 2023-24 we are seeing audiences continue to grow for our ambitious programme.
“We are currently mid-way through our annual Inverness Film Festival and ticket sales have already surpassed last year’s total sales.
“Likewise live performance audience numbers are growing and in fundraising we’ve been successful with grants to expand our activity in key areas.”
Ms Holt said large-scale musicals and performances from Scotland’s national companies will appear in its live programme.