Sustained revenue and profit growth for Scottish hotels

A simultaneous surge in occupancy of 3 percentage points and in average room rate (ARR) of 1.3 per cent helped hotels in Scotland to increase revenue per available room (RevPAR) by 5.5 per cent to £57.65.

Additional revenue growth per available room in beverage (14.7 per cent to £11.52), food (8.1 per cent to £22.68) and meeting room hire (2.6 per cent to £4.30) as well as leisure (4.8 per cent to £4.80) contributed to a TrevPAR uplift of 6.3 per cent to £104.05, compared to £97.92 for the same period last year. 

Efficient operational cost control enhanced departmental operating profit per available room (DOPPAR) by 6.8 per cent to £54.62 and this, coupled with a significant drop in overheads per available room by 7.0 per cent and a minor increase 0.3 percentage point in payroll, produced a GOPPAR surge of 6.5 per cent to £27.30. 

Leeds' occupancy surge​

Meanwhile, hotels in Leeds achieved the highest performance growth recorded in absolute figures over the last four years, with double-digit increases in TrevPAR and GOPPAR by 11 per cent and 22.1 per cent respectively.

Both occupancy and ARR surged by 6.1 percentage points to 83.4 per cent and 6.4 per cent to £71.17 leading to a 14.9 per cent increase in RevPAR to £59.32. Segment mix changed with rises in the volume of Best Available Rate (B.A.R.), residential conferences as well as tours & groups, which cancelled out a slight decline in corporate and leisure sectors - the two biggest segments.

Non-rooms revenues growth per available room derived from food (7.9 per cent), beverage (9.9 per cent), meeting room hire (18 per cent) and leisure (2.6 per cent) led to a TrevPAR rise of 11 per cent to £113.04 in Leeds. Astute operational cost control helped to convert revenue gains into a 16.8 per cent increase in DOPPAR to £63.23.

Although overheads per available room rose notably by 10 per cent, payroll decreased by 1.8 percentage points and GOPPAR consequently increased by a stunning 22.1 per cent to £36.95. 

Southampton's profits drop ​

Down in the south, hotels in the coastal destination of Southampton showed the importance of looking beyond RevPAR. Demand levels increased, as occupancy rose by 3.5 percentage points to 72.1 per cent, albeit at the expense of average room rate (1.9 per cent). As a result, RevPAR grew  by 3.0 per cent to £42.99.

However, mixed performances were recorded in Southampton's other non-rooms departments and TrevPAR went up only by 0.9 per cent to £81.15. But with cost of sales increasing - especially with a 26.2 per cent rise in travel agents commission per room let and with overheads per available room rising by 3.8 per cent - payroll efficiency was not enough to offset a 5.2 per cent decline in GOPPAR.

On a calendar year basis, the picture is still positive with hoteliers in Southampton experiencing increases in TrevPAR and GOPPAR by 3.0 per cent and 2.2 per cent respectively, but GOP conversion deteriorated slightly to 25.5 per cent from 25.7 per cent compared to the same period last year.

The HotStats profit and loss benchmarking service enables monthly comparison of hotels’ performance against their competitors. It provides in excess of 100 performance metric comparisons, covering 70 areas of hotel revenue, cost, profit and statistics.