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‘Discordant’ performance at UK hotels continues

30 December 2019 by
‘Discordant’ performance at UK hotels continues

Revenue growth hasn’t been an issue for UK hoteliers this year, but driving profit has been a frustration, according to hotel market analysis service HotStats.

Revenue per available room (revpar) grew slightly 0.3% year-on-year in November, while gross operating profit per available room (goppar) was down 1.8% year-on-year, illustrating the sometimes incongruous relationship between revenue and profit.

Yearly numbers note the trend: revpar is up 1.9% for the year to date, while goppar is down 0.9%. While 2019 has seen eight months of year-on-year total revenue per available room (trevpar) increases, it has also seen eight months of year-on-year goppar declines.

The divergent revenue and profit picture across the UK held true for the month in Birmingham (pictured), where both revpar and trevpar were up year-on-year 3.6% and 1.1%, respectively, against a year-on-year decrease in goppar of 1.5%.

London hotels checked in with similar results. Revpar in the month was up 0.7% year-on-year on a 2.6% increase in average room rate. Occupancy was down 1.5 percentage points to 82.3%. Total revenue was down 0.4% year-on-year, as total food and beverage revpar decreased 2.4%.

For year-to-date, hotels in London have recorded a 2.6% increase in trevpar and a 1% increase in goppar, signs of a still strong, if not more restrained in growth, market. Profit margin for the month of November was recorded at 44.7%, one percentage point less than the same time last year.

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