UK hotel profit drops by 14 per cent
UK Chain Hotels Market Review – November 2008 | Tri Hospitality Reports
In the provinces total revenue (TrevPAR) decreased by 7.3 per cent to £101.83 per available room and profit dropped by 13.7 per cent to £33.69 per available room. Provincial average occupancy fell by 3.7 percentage points to 70 per cent and average room rate dropped by 1.5 per cent to £73.97.
Glasgow and Aberdeen grow rate and profit
The only major provincial cities to report increases in profit were both north of the border. In Glasgow, the UEFA Champions League Celtic and Manchester United match, the Scotland and Argentina friendly, a UNICEF conference and three major medical conferences had a positive impact on hotel profit. In Aberdeen, the combination of strong demand from oil and gas industries and the limited supply of branded international hotels increased occupancy, rate and profit.
The London sample of 109 full-service chain hotels reported a 10.5 per cent fall in total revenue to a daily figure of £144.33 per available room. IBFC declined by 14.6 per cent to £69.79 per available room.
“The overall picture is unfortunately of falling revenue and profit. What is encouraging, however, is that hoteliers are maintaining their efforts to promote their businesses. Our survey shows that sales & marketing, a cost that is often the first to be cut has not been reduced” said Langston.
Overseas Visits down by 4 per cent
In the three months to October, the number of overseas visits to the UK fell by 4 per cent to 8.6 million compared to the same period a year earlier. The latest available International Passenger Survey reported a 23 per cent fall in visits from North America to 970,000, but there was no yearAdvisor of the Year on-year change in the number of inbound trips from Europe at 6.3 million. Visits from the rest of the world fell by 9 per cent to 1.4 million.
“Recent media reports have highlighted how the weak pound is attracting more continental Europeans to London for Christmas shopping. If the exchange rate stays at similar levels into 2009, this may create ongoing benefits for inbound tourism,” said Langston.
In more recent data, BAA, the operator of seven UK airports including Gatwick and Heathrow, reported handling 9.8 million passengers during November, a year-on-year drop of 8.9 per cent. Year to date, BAA’s UK airport traffic showed a 2.4 per cent decline for the eleven months to November at a total of 134.6 million.
Among individual airports, BAA said that Heathrow (-4.8 per cent) was the most resilient, partly because of its greater share of long haul markets. Both Gatwick (-13.5 per cent) and Stansted (-13.2 per cent) felt the negative impact of short-haul airline service cutbacks.
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