The bad weather impacted profits at UK hotels far more than London, says TRI

25th February 2010, 10:04am

The economy and weather impacted profits at hotels in the Provinces far more than in London, according to the latest HotStats survey from TRI Hospitality Consulting.

Gross Operating Profit per Available Room (GOPPAR) in Provincial UK was recorded at £10.86 following an 18.9% decline in profitability against the same period in 2009. This is compared to a GOPPAR of £42.48 at London hotels following a growth in profitability of 19.2%.

January is typically a challenging month for the hotel industry, with leisure visitors suffering from a spending hangover after Christmas. However, the addition of poor weather through most of the month has forced Provincial average room rates to decline further downwards than in January 2009, by approximately 6.2%, to £64.07.

Jonathan Langston, managing director, TRI Hospitality Consulting, said: "For many businesses and individuals across the UK, 2010 was expected to be a period of consolidation and it was widely anticipated that January would provide a good indication of what UK hoteliers can expect this year.

"However, it would be unjust to use January as a barometer for the rest of the year when the UK transport infrastructure frequently ground to a complete standstill and a high percentage of leisure and business travellers enjoyed an extended Christmas break."

A 1% increase in the level of payroll as a percentage of total revenue, to 39.8%, also contributed to the overall decline in profitability across the Provincial UK in January. This is compared to a 2.5% decrease in payroll as a percentage of total revenue at London hotels. As a result, in January 2010, the payroll department in provincial hotels was ten percentage points less efficient than those in London.

Related Articles:

• 02 Nov 2009 - London hoteliers lead the way
• 28 Oct 2009 - London hoteliers boost profits
• 26 Aug 2009 - London Hotel occupancy exceeds 2008 levels
• 24 Aug 2009 - TRI partners with Visit London
• 25 Jun 2009 - Recession has less impact on UK hotels
• 22 May 2009 - London occupancy stays above 80%

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