HotStats European Chain Hotels Market Review – June 2013
Dublin enjoys a touch of the green while Brussels sprouts, but downwards
Dublin’s hoteliers recorded a 12.0% increase in profits per room in June, according to the latest HotStats survey bringing the calendar year-to-date GOP per available room increase to 25.7% and the rolling 12 months growth figure to 31.0%.
In the first half of this year, this profit boost in the Irish capital was due, in part, to an increase in RevPar of 11.3% to €116.44 which was mainly rate driven (+7.6%). Drilling deeper into the numbers reveals that a 2.7% rise in the residential conference segment contributed to growth in meeting room hire revenues and in food and beverage income; leisure departmental revenue also posted growth. Even though rooms direct expenses per room let (+3.9%), in particular travel agents commission (+6%), TrevPar gains were successfully converted to profit growth thanks to payroll efficiencies.
The Belgian capital recorded an increase of 1.8% in RevPar in June, mainly driven by rising occupancy (+1.1 percentage points). But hoteliers in Brussels simultaneously saw their total revenue and profitability deteriorating. A decline in the residential conference segment meant meeting room revenues dropped by 30.3% per available room in June. Decreasing income from food (-8.9%) and beverage sales (-13.0%) were among the contributors to a TrevPar decline of 1.1%. As cost levels remained stable, the total revenues decrease led to a decline of 1.7% in profits per available room (GOPPAR) to €48.42. Once again RevPar gains flatter to deceive as the true picture of the health of Brussels’ hotel sector in June is revealed by the profit benchmark.
In the context of the rolling 12 months RevPar remained flat at €84.47 whilst rising payroll costs in conjunction with declines in food and meeting room revenues led to a decline in GOPPAR of 2.5%.
The hotel market in Istanbul has been impacted by the recent anti-government protests in and around Taksim Square with regards to both average room rate (-5.7%) and occupancy (-20.5 percentage points). As all other key performance indicators fell in June as a result of the political unrest so, too, did profits per available room recording a decline of 42.0%.
Hoteliers in Warsaw experienced the year-on-year effects of the boost caused by last year’s European Football Championship with a 60.5% decrease in ARR in June. However, occupancy increased by 9.2 percentage points to 86.2% resulting in a 55.7% decline in RevPar compared to last year. As food revenues per available room rose by 13.4% thanks to a change in market segmentation compared to June 2012, the year-on-year drop in rooms revenues was partly mitigtated. Rising overhead costs, however, impacted profitability resulting in a decline in profits per room of 62.3% year-on-year.
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.
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- 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.
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