THE chief executive of family-run Crieff Hydro has underlined the importance for tourism businesses to invest in staff training, facilities and guest experiences as the Perthshire hotel booked a 3% rise in pre-tax profits.

The resort, which offers a range of accommodation and outdoor activities in its extensive grounds, has seen earnings before tax increase to £633,145 for the year ended February 28, 2013.

With profits after tax and available for distribution coming in at £466,344, up from £352,551 in 2012, the directors have proposed a dividend of 6p for 2013. This will amount to a payout of £312,265, up from £297,777 in 2012.

The profits rise came amid a 4.4% increase in turnover to £17.7 million, which chief executive Stephen Leckie said had allowed the company to re-invest in people, product and improving the hotel's service levels.

Mr Leckie, who chairs the Scottish Tourism Alliance, said: "The key for us is revenue. If revenue does not grow we are in trouble. We have to invest to get the best customer satisfaction. That enables us to spend the money wisely back into a whole variety of things which all equal the success.

"One is the fabric of the building, keeping it to a five-star quality, two is the people - the staff, training, team, bonuses, uniforms, names badges - to help them feel good about their jobs."

The last financial year saw the Hydro, which employed 384 staff over the period, invest £1.4m in capital expenditure projects. These included the roll-out of wifi and refurbishments to bedrooms, self-catering accommodation and leisure changing areas. Investment was also made in roofs, roads and in the hotel's fire alarm system and in-house laundry.

Mr Leckie noted the Hydro is continuing to expand its range of outdoor activities, which currently number 62 and range from quad biking and horse riding to archery and golf. One of its most recent additions is Aloft, a treetop adventure experience which involved the laying of 800 metres of cabling.

Mr Leckie, who is part of the fifth generation to have run the hotel, said outdoor pursuits were growing in importance to Scottish tourism. He said: "Adventure tourism, mountain biking, Sail Scotland, marine tourism, heritage sites, archaeology - all of these things are good news for things to do around in Scotland, and Crieff Hydro plays a small part in that."

The hotel, which did not extend its accommodation capacity over the period, reported a 5.8% improvement in average room rates, which drove a 6.1% increase in room yield.

Its performance was said to have compared favourably with trends observed in the sector in Scotland and provincial parts of the UK, with the directors having set similar growth targets for the current financial year.

Although the directors noted a weak outlook for the sector and economic uncertainty in the accounts, Mr Leckie said there were grounds for optimism in the wake of key economic indicators.

He noted the Hydro had enjoyed a strong summer season this year, with trading in the current year currently running 6% ahead of 2012. But he insisted growth can be achieved by hotels through continual investment.

Mr Leckie said: "Those who address quality will be fine. I think the new growth is slow growth.

"Those who have not invested in quality are not doing too well. Frankly [they] are now going to struggle - the banks will not lend to reinvest because they have not got the business plan because the business is not doing well.

"I do feel for these people. But those who have invested, and are investing in quality, people, staff, management, [and] leadership skills, will do well."

In his wider role in the tourism industry, Mr Leckie has campaigned for hotels in rural areas to be equipped with wi-fi and high-speed broadband, a call he said had been heeded by providers. He has now turned his attention to 3G mobile phone coverage.

Mr Leckie said: "My next beef, and it always has been, is mobile phone signal, network coverage, especially as we move into Ryder Cup year.

"We must have 3G signal around Scotland - it is just not good enough to have 2G in far too many areas. The big push now is, "come on mobile phone providers, stop just taking the cash". A big part of Scotland's success is what happens out in rural areas, the counties, the villages and towns.

"They must have both wi-fi and broadband and mobile phone signals and not just 2G, but 3G. If we do not, we will fall behind, we will be in the back-water."