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Rezidor Hotel Group commits to more cost-savings

16 February 2009 by
Rezidor Hotel Group commits to more cost-savings

The Rezidor Hotel Group is to step up its cost-saving programme after revenue per available room (revpar) fell sharply in the final quarter.

Revpar at the group fell 5.3% year-on-year to €72.80m (65.18m) in the three months to 31 December. Like-for-like occupancy was 63.1% compared with 67.6% in the previous three months.

It was enough to drag annual pre-tax profit down from €45.7m (£40.92m) a year ago to €26.14m (£23.41m).

Kurt Ritter, president and chief executive, said: "Industry revpar is expected to continue to decline further in 2009. In order to meet an increasingly weaker market we have extended our existing cost-cutting programme to a level of annual savings of around €30m and are constantly monitoring the need for additional reductions."

"Rezidor continues with the long-term strategy to focus its growth on fee-based managed and franchised contracts to reduce risk in the portfolio."

Ritter said the company had as of 2008 a pipeline of more than 22,000 rooms, of which 88% were managed or franchised.

Rezidor has also announced that it has added hotels in three new countries to its global portfolio, with sites in Zambia, Macedonia and Angola.

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By Gemma Sharkey

E-mail your comments to Gemma Sharkey here.

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