U.S. Hotel Profitability Dipped in August
HENDERSONVILLE, Tennessee - With the end of the summer travel surge, estimated gross operating profit for U.S. hotels came in lower than the previous month, according to STR‘s August 2021 monthly P&L data release.
- GOPPAR: US$49.31
- TRevPAR: US$146.22
- EBITDA PAR: US$32.13
- LPAR (Labor Costs): US$47.99
“Lower profitability levels were not surprising given the lower top-line performance we reported for the month,” said Raquel Ortiz, STR’s assistant director of financial performance. “There was a decline in the percentage of U.S. hotels to break even on both a GOP and net income basis, and labor costs were up even with weakened demand. An encouraging sign came in the major markets, with improved TrevPAR and GOPPAR indices because of higher realized occupancies, but obviously those markets have the longest way to go."
“July was likely the profitability peak for this part of the recovery cycle, but September P&L data will be quite interesting given the gains we’ve seen in group demand over the last few weeks. F&B revenues, specifically in the catering departments, have been incredibly low because of the low volume of events in hotels.”
Key profitability metrics:
- TRevPAR – Total revenue per available room
- GOPPAR – Gross operating profit per available room
- EBITDA – Earnings before interest, income tax, depreciation, and amortization
- LPAR – Total labor costs per available room
STR provides premium data benchmarking, analytics and marketplace insights for the global hospitality industry. Founded in 1985, STR maintains a presence in 15 countries with a corporate North American headquarters in Hendersonville, Tennessee, an international headquarters in London, and an Asia Pacific headquarters in Singapore. STR was acquired in October 2019 by CoStar Group, Inc. (NASDAQ: CSGP), the leading provider of commercial real estate information, analytics and online marketplaces. For more information, please visit str.com and costargroup.com.