GOPPAR Grows Slightly at UK Hotels in August

Home Hotel & Lodging GOPPAR Grows Slightly at UK Hotels in August
GOPPAR Grows Slightly at UK Hotels in August

Profit per room at UK hotels increased year-over-year for only the second time this year, but hoteliers will take it. GOPPAR in August increased 0.6% YOY, the first positive growth since it grew 11% YOY in June. The rest of 2019 had been a GOPPAR dud. Hoteliers now hope it’s the start of a winning streak.

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Growth in August was led by a strong top line, as room occupancy levels hit 83.9% and average room rate increased by 2.9% YOY to £123.70. This contributed to a 2.1% uplift in RevPAR in the month to £103.77.

Positive RevPAR performance was fuelled by the leisure sector, which dominated the market mix in August, accounting for 41.5% of total roomnights sold, with a 0.2% YOY increase in rate.

Furthermore, growth in profit came despite a 5.0% YOY increase in payroll per available room, which grew to £41.63, equivalent to 28.4% of total revenue.

Despite the positive performance this month, profit per room for YTD 2019 remains 0.3% behind the same period in 2018 at £51.04.

Profit & Loss Key Performance Indicators – Total UK (in GBP)

“August is consistently one of the stronger trading months in the UK each year, and hoteliers will be keen to keep the momentum going after a year of broad negative GOPPAR growth,” said Michael Grove, Managing Director, EMEA, HotStats. In order to do so, expense control will be an utmost priority, especially as payroll continues to rise. In fact, August was the highest month of payroll expense growth so far this year.”

Hotels in Edinburgh recorded typical annual peak performance in August, a result of high demand brought on by the Edinburgh Fringe Festival, the largest arts festival in the world.

And whilst hotels in the city only recorded a 0.4% YOY increase in profit per room in the month, GOPPAR was almost £75 above the YTD figure at £65.79.

Revenue levels were driven by a spike in room occupancy, which was recorded at 94.6% for the month, and coupled with an average rate of £211.51, a high for the year and almost 50% above the YTD rate performance at £141.18.

Despite only recording a 0.1% YOY increase in RevPAR, a 6.0% increase in ancillary revenues contributed to a 1.4% increase in TRevPAR, which hit £249.08 for the month.

Profit conversion in Edinburgh was recorded at 56.4% of total revenue in August.

Profit & Loss Key Performance Indicators – Edinburgh (in GBP)

It was an equally positive month for hotels in Brighton, where the summer sun fuelled demand in the coastal city, driving a 2.7-percentage-point increase in room occupancy to 91.3%. This was coupled with a 3.4% YOY increase in average room rate, which grew to £122.54.

Growth this month punctuated a purple patch of revenue performance for hotels in Brighton, which saw TRevPAR for the month increase by 5.6% and grow by almost £14 over the last two years due to consistent monthly growth.

GOPPAR was up 1.2% YOY in the month, but was impacted by an uplift in payroll, which increased 2.6% YOY.

Profit & Loss Key Performance Indicators – Brighton (in GBP)

About HotStats

HotStats provides a unique profit-and-loss benchmarking service to hoteliers from across the globe that enables monthly comparison of hotels’ performance against competitors. It is distinguished by the fact that it maintains in excess of 500 key performance metrics covering 70 areas of hotel revenue, cost, profit and statistics, providing far deeper insight into the hotel operation than any other tool. The HotStats database totals millions of hotel rooms worldwide. For more information, visit www.hotstats.com.