HotStats European Chain Hotels Market Review – October 2013
Revenue and profit growth for Brussels, Dublin and Paris hotels
Of the five European city markets featured, Brussels, Dublin and Paris registered a growth in total revenue per available room (TrevPAR) and gross operating profit per available room (GOPPAR) for the month of October, according to the latest HotStats survey.
Brussels registered a 2.6% increase in revenue per available room (RevPAR) thanks to a 1.7 percentage points rise in occupancy to 78.9% and a small increase (0.5%) in average room rate to €133.53. Additional revenues per available room from food (+9.1%), beverage (9.3%) and meeting room hire (+15.9%) contributed to a total revenue per available room (TrevPAR) surge of 5.1% to €152.03.
Food and beverage conversion rose by 5 percentage points and helped to enhance the departmental operating profit per available room (DOPPAR) of €86.22, representing a 7% increase. Despite a 1.3% uplift in overheads per available room, Brussels hoteliers controlled their payroll as a percentage of total revenue, decreasing it by 3.9 percentage points, which led to an 11% rise in GOPPAR.
Hotels in Dublin and Paris also showed positive year-on-year performance in October across all key performance indicators with increases in TrevPAR by 0.8% and 3.1% and GOPPAR by 8.7% and 4.4% respectively.
Moscow and Istanbul experienced challenging conditions
In the Russian capital, hotels managed to increase occupancy in October by 1.0 percentage point but average room rate (ARR) declined by 2.3% leading to a RevPAR decline of 1.1% to €125.36. Mixed performances were also recorded in other departments with revenue per available room from food and leisure decreasing by 2.8% and 24.6% respectively, whilst revenue per available room rose from beverage (2.7%) and meeting room hire (4.7%). As a result, TrevPAR dropped by 1.0% to €198.90.
A general rise in operational costs impacted departmental operating profit per available room (DOPPAR) by 5.4%. Payroll also rose by 2.0 percentage points and with admin and general and utilities expenses also increasing, hotels’ profitability in Moscow diminished by 9.3%. However, the picture is much more positive when looking at the calendar year performances with increases in TrevPAR and GOPPAR of 5.0% and 7.2% respectively.
Istanbul reported negative year-on-year comparisons in most key performance indicators, with ARR being the only exception. Occupancy dropped significantly to 59.5% compared to 66.9% last year and consequently RevPAR and TrevPAR decreased by 10.7% and 8.5% respectively. Despite overheads per available room slightly dropping by 1.9%, rising payroll contributed to an 18.8% decline in GOPPAR. But unlike Moscow, these October results confirmed trends observed throughout 2013.
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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