HotStats European Chain Hotels Market Review – November 2013
Barcelona, Prague and Frankfurt: RevPAR flat, GOPPAR up and down
Of the five European city markets featured, Barcelona, Frankfurt and Prague registered similarly flat revenue per available room (RevPAR) performance in November compared to the same period last year, according to the latest HotStats survey. However, gross operating profit per available room (GOPPAR) performance varied emphasising how misleading RevPAR can be as a KPI.
In November, Barcelona hotels increased occupancy by 2.6 percentage points to 66.0% but at the expense of average room rate (ARR) leading to a flat RevPAR (year-on-year change of 0.1%) to €92.01. Mixed performances were registered in other departments so total revenues per available room (TrevPAR) remained nearly unchanged (-0.2%) to €142.45. However, operating cost control helped to improve departmental operating profit per available room (DOPPAR) by 3.4% to €82.75 and, combined with overheads per available room and payroll decreasing respectively by 4.1% and by 1.3 percentage points, hoteliers made the most of the situation with a notable GOPPAR rise of 8.5% to €51.83.
Hotels in the Czech capital also managed to convert a nearly flat RevPAR movement (0.3%) to €51.46 into a staggering profit enhancement with a rise of 13.0% in GOPPAR to €33.54. Although a general decrease in ancillary revenues led to a 2.5% drop in TrevPAR, hoteliers in Prague adapted to adjust cost of sales and department operating expenses accordingly and improved DOPPAR by 6.2% to €58.23. Overheads per available room diminished and payroll decreasing by 1.6 percentage points contributed to the profit growth.
Frankfurt hoteliers saw RevPAR virtually flat (0.1%) at €100.94 and TrevPAR (0.3%) at €163.50 in November. But unlike Barcelona and Prague hotels, results impacted the profit line with a 3.8% fall in GOPPAR. Despite payroll decreasing by 0.5 percentage points, operating costs slightly increased as well as per available room increases in sales and marketing (+13.5%), property & maintenance (+7.8%) and utilities costs (-8.8%) causing the profit decline.
Berlin and St Petersburg grow revenues and profits
In November, Berlin experienced a 0.8% decline in RevPAR to €93.42 driven by a 1.1 drop in ARR despite a 0.3 percentage point increase in occupancy to 77.8% (1 percentage point above the calendar year performance). However a strong non-rooms revenue growth per available room led most notably by food (+20.4%) and meeting room hire (36.5%) resulted in a 7.2% rise in TrevPAR to €181.81. Food and beverage conversion improved by 4.7 percentage points to 39.5% and DOPPAR by 9.7% to €104.57. Cost control and payroll management helped to achieve an astounding 22.0% increase in GOPPAR to €71.34.
Hoteliers in St Petersburg reported positive year-on-year comparisons across all key performance indicators. Both occupancy and ARR went up and led to a 10.9% increase in RevPAR to €47.43. A general increase in other sources of revenue contributed to an 8.5% uplift in TrevPAR to €80.74. Notwithstanding a 0.4 percentage surge in payroll and an increase in operating costs, overheads per available remained stable and GOPPAR went up by 2.9% to €20.29.
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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