HotStats UK Chain Hotels Market Review – December 2013
UK hotel profits up in 8 out of 12 regions
Out of the 12 UK regions, the North West is one of eight regions to achieve a year-on-year increase in gross operating profit per available room (GOPPAR) for 2013. Those posting negative year-on-year movements in GOPPAR are Greater London, the East of England, the North East and the West Midlands, according to the latest HotStats.
In December, hotels recorded positive results across all key performance indicators with TRevPAR and GOPPAR figures contributing to enhance the overall performance.
Birmingham behind the pace
In line with the West Midlands region results, Birmingham saw increases in RevPAR and TRevPAR by 2.3% and 1.1% respectively, but hotels were not able to convert these gains into profits, recording a 1.6% drop in GOPPAR during 2013, according to HotStats.
The rise in RevPAR performance was due to a 1.6 percentage point increase in occupancy offsetting a minor decline in ARR. Mixed results were recorded in other departments leading to a 1.1% increase in TRevPAR. Efficient operating cost control improved departmental operating profit per available room (DOPPAR) by 1.4% to 54.49. However, overheads per available room increased significantly by 5.7%, led most notably by 7.1% and 6.9% uplifts in utilities and administration and general costs. With payroll going up by 0.4%, GOPPAR declined by 1.6% to £31.30.
In the month of December, despite a RevPAR surge of 5.1% GOPPAR went down by a staggering 21.4% due to overheads per available room and payroll increasing by 37.9% and 2.0% respectively.
Nottingham nudges forward
In 2013, Nottingham hoteliers managed to increase occupancy by 4.9 percentage points to 68.7% at the expense of the ARR, which declined by 1.0%. As a result RevPAR grew 6.6% to £37.46. With growth in food sales (5.4%), beverage revenue (4.4%) and meeting room hire (2.5%), TRevPAR rose by 5.9% to £69.67 which combined with cost reductions to deliver a 7.8% increase in DOPPAR. Payroll decreased by 2.0% and despite an unavoidable rise in overheads per available room common to most UK markets, GOPPAR grew by an impressive 11.4%.
In December, RevPAR significantly increased by 10.0% but GOPPAR declined by 8.5% demonstrating once again the importance of looking beyond rooms key performance indicators when assessing hotel performance.
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