Manchester-based Hydes' Brewery has sunk into the red with a £1.3m pre-tax loss for 2009 after profits were dragged down by more bad debts.
The company, which brews Hydes' Original and Manchester's Finest, as well as operating an estate of around 80 pubs, first highlighted "accounting irregularities" in its tenanted estate last year.
The discovery forced Hydes' to write off £675,000 in bad debt provision in 2008, and it has written off a further £369,000 for the year to 29 March 2009.
Hydes' said the problems had had a "major adverse effect" on its tenanted pubs business, where it sought substantial debt repayments from certain tenants, who were unable to pay and handed back the keys.
That had a knock-on effect on its managed estate, where profit decreased 14% overall, after eight pubs needed to be brought into the division following the sudden departure of tenants.
The company's woes were compounded by having to write down the value of its pub estate by £1m due to falling property prices for 2009.
Annual turnover was up slightly to £22.8m from £21.4m in the previous year, despite a wet summer, the economic slowdown and an 18% hike in beer duty.
And there were more positive signs at the firm's new venture, the Joshua Bradley, on the site of a Victorian mansion formerly known as Bamford Hall. The pub-restaurant and wedding venue saw sales hit £1m for the year, £224,000 above budget.
Meanwhile, its 36-bedroom budget hotel, the Lodge in Wilmslow, returned returned profits of £127,000 with mid-week occupancy of 81%.
Directors and senior management did not take a bonus after the firm missed its financial targets for the year.
By Neil Gerrard
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