Hotel chains report mixed May performance

By Sophie Witts contact

- Last updated on GMT

Hotel chains report mixed May performance

Related tags: Cent, Hotel

Regional hotel chains continued to experience mixed year-on-year profit growth across the UK in May, as London sites registered a decline.

Third parties profit in West Midlands

According to the latest HotStats report, West Midlands hotels registered one of the strongest performances with a 4.7 per cent increase in gross operating profit per available room (GOPPAR).

The region recorded a surge in occupancy of one per cent to 69.5 per cent, and average room rate (ARR) rose 2.5 per cent to £72.03.

Travel agency commission per available room rose 19.2 per cent to £5.03, compared to the same period last year.

This meant that while Room revenue per available room (RevPAR) grew by £1.95 to £50.09, 41.5 per cent of the increase was paid to third party intermediaries.

Total revenue per available room (TRevPAR) levels were softened to a rise of 2.8 per cent to £102.05.

At the same time, hoteliers managed to reduce payroll to 31.8 per cent from 32.5 per cent. Despite overheads per available room increasing by one per cent, GOPPAR rose 4.7 per cent to £31.07.

Brighton hotels decline

Brighton hotels experienced a 6.4 per cent decline in GOPPAR to £46.05, driven by decreases in revenue from meeting room hire (-26.2 per cent), food (-5.8 per cent) and beverage (-2.3 per cent).

As a result TRevPAR levels rose by just 0.9 per cent to £123.11.

There was some positive news, as a 3.7 per cent surge in demand and 1.5 per cent increase in ARR saw RevPAR rise 6.5 per cent year-on-year.

Brighton hoteliers’ payroll costs increased by 0.9 percentage points, and a 12.8 per cent surge in overheads per available room further impacted the GOPPAR decline - representing a gross operating profit conversion of 37.4 per cent for the month.

Profits stagnate in Nottingham

Nottingham hoteliers experienced an uplift in revenues with both RevPAR and TRevPAR rising by 2.8 per cent and 2.6 per cent respectively. 

However, this increase failed to translate to bottom-line performance during May, as GOPPAR remained stable at £23.00.

Hotels in the city recorded a growth in ARR of 4.4 per cent, while occupancy fell one per cent, resulting in RevPAR jumping to £43.25.

Mixed performances in ancillary departments contributed to a TRevPAR rise of 2.6 per cent to £77.89 compared to the same period last year.

Payroll costs grew by 1.0 per cent and negated the revenue increases, and a 2.2 per cent surge in overheads per available room further impacted profitability levels resulting in GOPPAR stagnating for the month.

Related topics: Hotels, Trends & Reports, Business

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