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UK Provinces and East Midlands grow profits, but London loses again.
Thursday, 24th July 2014
Source : HotStats
Whilst London's hotel profitability fell for the second consecutive month in June, the UK Provinces continued to show year-on-year positive movement for gross operating profit per available room (GOPPAR) and in particular, East Midlands’ hoteliers experienced a 3.3% growth in this metric.

East Midlands hotels recorded a combined surge in occupancy of 1.1 percentage points and growth in average room rate (ARR) of 1.6% resulting in an increase in rooms revenue per available room (RevPAR) of 3.1% to £45.92.

With non-rooms departments also pushing ahead, total revenue per available room (TRevPAR) went up by 1.4% to £88.94, representing the 17th consecutive year-on-year growth for this metric.

Departmental operating profit per available room (DOPPAR) rose by 2.5% and despite payroll and overheads per available room increasing by 0.5 percentage points and by 1.5% respectively, GOPPAR surged by 3.3% to £27.07.

Liverpool looms large

Liverpool hoteliers have experienced improving trading conditions with increases in GOPPAR of 5.1% for the rolling 12 months to June, 9.0% for the first semester and 13.2% for the month of June, according to the latest data from HotStats.

In June, this profit performance was supported by a 10.5% uplift in RevPAR thanks to a coupled rise in occupancy of 4.3 percentage points and in ARR of 4.4%. Positive movements were recorded in ancillary departments and TRevPAR levels increased by 8.3% to £93.68.

Efficient operating cost control helped to deliver an 8.0% surge in DOPPAR, while payroll also declined by 0.9 percentage points. Despite a slight increase in overheads per available room (+0.7%), hoteliers managed to increase their gross profit conversion from 34.7% to 36.2% this month.

RevPAR rises, profits plummet in Coventry
Coventry hotels demonstrated once again that RevPAR alone can be a misleading indicator of hotel health with a rise of 4.7% this June, as TRevPAR and GOPPAR levels went down by 1.2% and 18.5% respectively, according to the latest data from HotStats.

A rise in demand of 2.5 percentage points with a 0.9% increase in ARR delivered the RevPAR growth. However, a general decrease in non-rooms revenue per available room from food (-4.1%), beverage (-3.4%) and C&B room hire (-15.5%) led to a TRevPAR drop of 1.2% to £90.20.

Simultaneously, operating cost control deteriorated leading to a DOPPAR decrease of 2.1%, while hoteliers also suffered from a 3.2 increase in payroll. A 15.6% increase in overheads per available room further impacted the GOPPAR decline of 18.5% to £19.85, representing a gross profit conversion of 22.0%.

However, taking the first six months of the year, the picture is more upbeat for hotels in Coventry with TRevPAR and GOPPAR rising by 4.6% and 10.3% respectively.
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