HotStats European Chain Hotels Market Review – December 2013
Vienna and Warsaw profits hit by rate drop
Profits at hotels in Vienna and Warsaw were both hit by significant declines in average room rate (ARR) in 2013, according to the latest HotStats.
In 2013, hotels in the Austrian capital saw a decline in all segment rates with falls in BAR (-7.2%), Corporate (-5.5%), Residential conference (-9.8%), Leisure (-4.5%) and Tours/Group (-8.4%) leading to an overall 7.9% drop in ARR. Although occupancy went up by 0.4 percentage point to 71.6%, RevPAR diminished by 7.4% to €93.96.
With ancillary departments also posting a reduction, total revenue per available room (TRevPAR) decreased by 6.3% to €145.20. Despite overheads per available room reducing, rising payroll and operating costs contributed to a 16.8% decline in gross operating profit per available room (GOPPAR).
Unsurprisingly, Warsaw posted a negative year-on-year comparison as its 2012 results were boosted by the 2012 FIFA European Championships. Indeed, despite a 7.1 percentage points surge in Occupancy to 78.6%, hoteliers in the Polish capital recorded a 14.4% drop in ARR to €90.22 leading to a 6.0% decline in RevPAR. A general decrease in non-rooms revenues contributed to a negative year-on year TRevPAR performance (-5.2%). With operating costs also increasing, departmental operating profit per available room (DOPPAR) decreased by 8.2% to €72.64. Although overheads remained flat, payroll rose by 1 percentage point and gross operating profit per available room decreased by 10.2% to €46.65 for 2013.
Budapest and Hamburg post revenue and profit increase in 2013
Budapest hotels registered positive movements in 2013 across all key performance indicators with increases in occupancy (1.0 percentage points) and ARR (2.5%) contributing to a 3.9% rise in RevPAR. With TRevPAR growing by 3.4% and payroll decreasing by 0.4 percentage points, GOPPAR improved by 7.9% to €30.69.
But in December hoteliers in the Hungarian capital experienced a more difficult end to the year with a surge in ARR of 9.2% at the expense of the occupancy, which declined by 4.7 percentage points. Negative year-on-year performances in non-rooms departments cancelled out a 1.0% increase in RevPAR and caused TRevPAR to decline by 4.6%. Falling F&B profit conversion (8.8 percentage points) and rising payroll reduced profit conversion to 22.5% and GOPPAR fell by 7.3% to €17.16.
In 2013, hotels in Hamburg achieved positive performances with a 1.1% decline in ARR being the only exception. With occupancy reaching a high level to 81.5% (+4.2 percentage points), RevPAR and TRevPAR grew respectively by 4.3% and 3.7% whilst hoteliers managed to reduce payroll by 0.6 percentage point. As a result, GOPPAR improved by 5.7% to €54.49.
Dusseldorf: revenue up but profit down…
Dusseldorf grew RevPAR by 1.4% for the year driven by a 2.1 percentage point uplift in occupancy and despite a 1.8% fall in ARR. As beverage per available room rose by 4.4% as well as sales from food and meeting room hire, TRevPAR registered a 1.5% growth to €132.83. However, profit conversion diminished from 36.7% to 35.8% because overheads and payroll increased causing GOPPAR to fall by 0.9% to €47.59.
In December, hoteliers in the German city experienced a tough end to the year. Indeed, despite RevPAR increasing by 1.2%, TrevPAR and GOPPAR reduced by 4.5% and 6.8% respectively compared to the same month in 2012, demonstrating yet again the need to look beyond RevPAR to see the true performance picture.
The hotels profiled in this report are drawn from the HotStats database and reflect the portfolios and distribution of the hotel chains that we survey and which operate primarily in the four and five-star sectors.
Please note: The data samples are reviewed and rebased each year to reflect the changes in the HotStats survey base. As a result, performance ratios published last year may differ from those contained within this report.
Occupancy (%) is that proportion of the bedrooms available during the period which are occupied during the period.
Average Room Rate (ARR) is the total bedroom revenue for the period divided by the total bedrooms occupied during the period.
Room RevPar (RevPAR) is the total bedroom revenue for the period divided by the total available rooms during the period.
Total RevPar (TRevPAR) is the combined total of all revenues divided by the total available rooms during the period.
Payroll % is the payroll for all hotels in the sample as a percentage of total revenue.
GOPPAR is the Total Gross Operating Profit for the period divided by the total available rooms during the period.
For an inside view of a local or regional market place in the hotel sector, bespoke HotStats reports are available. Terms and conditions apply. Visit www.hotstats.com to view a sample report.
HotStats provides two reporting tools to hoteliers:
- Our unique profit and loss benchmarking service which enables monthly comparison of hotels’ performance against their competitors. It is distinguished by the fact that it provides in excess of 100 performance metric comparisons covering 70 areas of hotel revenue, cost, profit and statistics providing far deeper insight into the hotel operation than any other tool.
- Our latest innovation in daily revenue intelligence, MORSE. Amongst its reporting are daily and highly granular market segmentation metrics as well as distribution channel and source of booking analysis. It takes daily market intelligence to a whole new level.
©HotStats Limited 2014 Unless otherwise attributed, all materials in this press release is the copyright of HotStats Limited.