Market Report U.K.

Profits Momentum for UK Provinces and North West, but London Declines Again During July 2014

UK Chain Hotels Market Review - July 2014

HotStats Although London profitability dropped for a third consecutive month in July, the UK Provinces continued to gain momentum with gross operating profit per available room (GOPPAR) surging and North West hoteliers experienced a 22.2% growth in this metric, according to the latest HotStats.

North West hotels managed to increase average room rate (ARR) by 11.5% as well as occupancy (+3.1 percentage points to 80.8%) in July resulting in rooms’ revenue per available room (RevPAR) climbing by 15.9%. With revenue per available room derived from food (+5.1%), beverage (+4.8%) and meeting room hire (+11.2) also climbing, total revenue per available room (TRevPAR) grew by 10.4%.

Despite overheads per available room going up by 6.2%, astute operating cost control coupled with payroll declining (-1.6 percentage points) led to the GOPPAR growth of 22.2% representing a gross profit conversion of 32.2%.

Tour de profit for York

The city which hosted in July the departure of the second Tour de France stage registered increases in TRevPAR and GOPPAR by 9.5% and 8.4% respectively, according to the latest HotStats.

Despite a 0.3 percentage point drop in occupancy, hoteliers in York experienced a double digit increase in RevPAR thanks to a 12.7% surge in ARR. Positive performances were recorded in non-rooms departments, in particular with meeting room hire per available room (+41.4%) leading to a TRevPAR surge of 9.5%. Departmental operating profit per available room (DOPPAR) also rose by 8.2% thanks to efficient operating cost control and payroll going down by -0.3 percentage points. Despite overheads per available room increasing by 8.0%, GOPPAR hiked by 8.4% for the 10th consecutive month.

Swindon on the up-and-up

Hoteliers in Swindon experienced year-on-year growth across all key performance indicators with TRevPAR and GOPPAR increasing by 14.7% and 38.9% respectively, according to the latest HotStats.

A combined surge in occupancy (+5.2 percentage points) and in ARR (+12.0%) contributed to a RevPAR growth of 19.0%. With 44.9% of the demand in July derived from the corporate sector, this segment rate surged by 9.1%. However the highest rate increase (+16.4%) was generated by from the residential conference segment which accounted for 8.8% of the total demand. Positive results were also registered in ancillary departments and TRevPAR rose by 14.7%.

With DOPPAR rising by 18.2%, hoteliers also managed to reduce payroll and overheads per available room by 4.4 percentage points and by 3.6% respectively. As a result GOPPAR increased by a stunning 38.9%, further fuelling calendar year to date and the rolling 12 months to July performances.

Graph - UK Chain Hotels Market Review - July 2014

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HotStats provides two reporting tools to hoteliers:

Our unique profit and loss benchmarking service which enables monthly comparison of hotels’ performance against their competitors. It is distinguished by the fact that it provides in excess of 100 performance metric comparisons covering 70 areas of hotel revenue, cost, profit and statistics providing far deeper insight into the hotel operation than any other tool.

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Tony Oliveira
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tony.oliveira@hotstats.com




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