ΔΙΕΘΝΗΣ ΕΛΛΗΝΙΚΗ ΗΛΕΚΤΡΟΝΙΚΗ ΕΦΗΜΕΡΙΔΑ ΠΟΙΚΙΛΗΣ ΥΛΗΣ - ΕΔΡΑ: ΑΘΗΝΑ

Ει βούλει καλώς ακούειν, μάθε καλώς λέγειν, μαθών δε καλώς λέγειν, πειρώ καλώς πράττειν, και ούτω καρπώση το καλώς ακούειν. (Επίκτητος)

(Αν θέλεις να σε επαινούν, μάθε πρώτα να λες καλά λόγια, και αφού μάθεις να λες καλά λόγια, να κάνεις καλές πράξεις, και τότε θα ακούς καλά λόγια για εσένα).

Τετάρτη 30 Δεκεμβρίου 2020

Profit plunge has hotel industry looking to brighter 2021, says HotStats

 

As a fresh round of stricter COVID-related guidelines grip many parts of the world heading into the new year, the hotel industry is still feeling and reeling from the sting of the pandemic, through breakthrough vaccines could be the antidote to spur devitalized demand.

Still, like George Harrison once sang, “It's gonna take time… A whole lot of precious time... It's gonna take patience and time…” For many hoteliers, patience has run out.

U.S. Backtracks
After pulling into positive profit territory in October, on the heels of multiple months of negative GOPPAR, the U.S. relapsed in November, falling back into negative numbers at $-3.05, a 103.4% decrease over the same time a year ago.

Occupancy was down 4 percentage points over October to 24.2% and coupled with an average rate at $143.74 produced RevPAR of $34.76, which was down more than 78% year-over-year and 15% over the month prior. October is historically a stronger month for U.S. hotel performance than November. TRevPAR in the month was down 79% YOY to $54.07.

Ancillary revenue continued to suffer. Total F&B revenue on a per-available-room basis remained below $10, a nearly 90% decrease YOY. It’s only to get worse after many cities, including New York, Washington, D.C., Philadelphia and areas across California, implemented indoor-dining bans in December as a measure to contain COVID-19 surge. Meanwhile, as in-person dining continues to suffer, carry-out and delivery, though not making up for the shortfall, are thriving. UBS Evidence Lab found that dine-in restaurant sales plunged 69% in the week ended Nov. 29; however, in that same week, carry-out and delivery sales rose 59%. Hotel restaurants are typically positioned different than regular, stand-alone restaurants and do not capture as much takeout and delivery revenue.

If not for cost control, hoteliers would be in an even more precarious position. Labor costs remained around the $30 level on a per-available-room basis, 68.5% less than at the same time a year ago. Overhead costs jumped $6 in November over October, but still down more than 55% YOY.

Profit margin clocked in at -5.7%, illustrating how much revenue has been lost and despite cost savings.

Europe Regresses
After pushing out two months of positive profit in August and September, October dipped below zero with the trend continuing in November, at an even deeper cut. GOPPAR in the month was -12.51 euros, a regression of 151% over October and 120.2% YOY. After demand crept higher in the previous three months, November crashed down to Earth with occupancy clocking in at 15.4%, almost 10 percentage points lower than October and 60.5 percentage points lower than at the same time last year. The decrease in occupancy, coupled with rate dropping below triple digits for the first time since June, resulted in RevPAR diminishing to 14.03 euros, an 87.9% YOY decrease. As a result of the drop in rooms revenue, total revenue took a hit as well, dropping to 23.95 euros, an 86.8% decrease over the same time a year ago and 47% less than October.

Labor costs dropped in step with the decrease in revenue, down to 19.38 euros, a 66% decrease YOY. All undistributed expenses remained well lower than the year prior, highlighted by a 42.5% drop in utility costs.

Profit margin was down to an extraordinary -52.2%, the worst it’s been since June when it was recorded at -84.3%.

It’s likely not to get much better for much of Europe, as a new strain coronavirus has resulted in many countries adding new restrictions. In the UK, much of the region, including London, is under Tier 4 restrictions, resulting in the closure of gyms, cinemas, hairdressers and most shops.

APAC Steady
Compared to the rest of the world, Asia-Pacific remains the lodestar everyone is starting up at. Though revenue and profit still remain well off historical comps, the region has only recorded three months of negative GOPPAR, which occurred at the outset of the pandemic. Since June, APAC has recorded six consecutive months of positive profit.

November was no exception. Though it didn’t reach October heights, November GOPPAR of $23.87 was the second-highest amount since operational performance foundered from COVID. It’s still a 62.9% YOY decrease.

Occupancy continued its steadiness, holding around 50%. A room rate north of $100 led to RevPAR of $50.58, which was still down 47.9% YOY. Though business travel has suffered enormously since the pandemic, APAC bucked the trend in November, recording an actual uptick in volume, increasing 3.7 percentage points over the same time last year to 20.7%.

Enervated ancillary revenue kept TRevPAR below triple digits and 44.7% off versus the same time last year.

Expenses were down across the board YOY; however, total labor costs have risen steadily since June, though are still well down over the prior year.

Profit margin was 24.7%, 12.1 percentage points lower than at the same time a year ago.

Middle East Above Water
The Middle East region stayed afloat in November, recording its highest RevPAR and TRevPAR since the pandemic debilitated the region, at $55.11 and $97.49, respectively. Both are still off more than 50% versus the same time last year.

The escalating performance on the revenue side led to a high in GOPPAR, which hit $18.52, the highest the data point has reached since February, when GOPPAR was $73.24. Ensuing months of negativity followed, with profit only pulling back into the black as of August.

Like APAC, the Middle East got a boost in corporate travel, which was up 2.5 percentage points in occupancy in the month versus the same time last year. Leisure volume mix was down 2.3 percentage points YOY.

Profit margin for the month was up to 19%, its highest since February and 3.1 percentage points higher than October, signifying both revenue gains and expense containment.


Tags: HotStats