Regions outperform London in January

By Carina Perkins contact

- Last updated on GMT

Regional hotels enjoyed double digit profit growth in January
Regional hotels enjoyed double digit profit growth in January

Related tags: Percentage point

Regional hotels outperformed London properties in January 2015, achieving double-digit profit growth compared to bottom line declines in the capital.

According to the latest HotStats UK Chain Hotels Market Review, the East Midlands was one of the leading UK regions in January, recording a 4.6 percentage point increase in occupancy to 55.3 per cent and average room rate growth of 5.5 per cent to £63.97.

Rooms revenue per available room (RevPAR) rose 15.4 per cent to £35.36 on the back of this growth, and a ‘positive performance’ from ancillary departments drove total revenue per available room (TRevPAR) up by 10.1 per cent.

Payroll reductions delivered improved profits, helping hoteliers in the region offset rising overheads and achieve gross operating profit per available room (GOPPAR) growth of 51.3 per cent.

Liverpool hoteliers also enjoyed strong January growth, with a 4.2 percentage point growth in occupancy helping offset 3.8 per cent ARR decline, delivering RevPAR growth of 4.4 per cent to £37.02.

Ancillary revenues showed ‘substantial improvements’ in the city, said Hotstats, driving TRevPAR up 4.9 per cent to £59.72. This, combined with efficient operating cost control and a reduction in payroll helped drive GOPPAR in the city up 20.2per cent to £8.85.

Aberdeen

In contrast, hotels in Aberdeen recorded negative year-on-year comparisons across all key performance indicators in January, with the exception of a 2.1 per cent uplift in room rates.

Occupancy fell 3 percentage points in the Scottish city, driving RevPAR down 2.7 per cent to £63.74, and mixed performance in non-rooms revenue led to a TRevPAR decrease of 1.8 per cent.

Increases in overheads and payroll further eroded profits, with GOPPAR falling 12 per cent to £29.80 during the month.

A report published by LJ Research earlier this month​ also noted decline in Aberdeen in January, and concluded that hotels in the city are continuing to feel the negative knock-on effects of a troubled North Sea oil and gas sector.

The report said Edinburgh and Glasgow delivered a ‘muted performance’ in January, resulting in a 5.6 per cent RevPAR decline across Scotland.

Related topics: Business, Hotels, Trends & Reports

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