The company behind one of Norfolk's best known boutique inns has reported a rise in sales boosted by continued investment in its properties.

Hoste Arms Limited, which operates the 35-bed Hoste Arms inn at Burnham Market and a string of other premises in the village, saw turnover increase by about �600,000 last year to �4.7m.

In addition to the Hoste Arms, the company runs the nearby Vine House Boutique Hotel, the Railway Inn, based in a converted train station in the village, and Burnham Market Holiday Cottages, made up of three luxury self-catering properties.

The accounts for the year ending May 2 2010 also showed an increase in gross profit from �1.8m the previous year to �2.04m.

Profit before tax fell by about �60,000 to �624,183 partly as a result of a �407,000 increase in operating charges.

The company said the uplift in trade reflected the investment in its premises.

The improvement comes at a time of mixed fortunes for the region's hoteliers, many of whom have seen rising numbers of holidaymakers in recent years but a squeeze on profits, partly a result of tourists' lower secondary spend, the VAT increase and higher utilities bills.

A number of hotel firms have also gone into administration in recent months, including Laccone, the company behind the luxury Broad House Hotel in Wroxham, and Maypole Group, which operates six hotels and inns, five of which are in Norfolk and Suffolk.

Administrator Baker Tilly is in talks with potential buyers for both businesses.

A report of the directors in the Hoste Arms Limited accounts said: 'The increase in turnover and gross profit was reflective of the investment in infrastructure in recent years to increase the level and quality of accommodation.

'The company continues to invest in its infrastructure and in particular the quality of its bedrooms.

'The directors see continuous refurbishment of the bedrooms as key to maintaining the company's quality and standards at the forefront of the hotel market.'

It added: 'The company is looking to build on the improvements seen this period, with particular emphasis being put on continuing to increase turnover and controlling costs to generate enhanced operating margins and higher profits.

'The directors continue to carry out periodic reviews of the furnishings in the hotel accommodation and maintain the cyclical refurbishment plans.

'The directors are always aware of the need to implement changes to all aspects to ensure that the market position is maintained.'

The company, which employs about 80, declined to comment on trading in its current financial year.