August profitability down at non-London hotels

Latest report from TRI Hospitality shows regional falls

TRI's David Bailey
TRI's David Bailey

Profitability at provincial UK chain hotels dropped during August, while London properties achieved modest growth according to the latest HotStats survey from TRI Hospitality Consulting.

Daily income before fixed charges (IBFC) - or gross operating profit - declined by 3.7% to an average annualised figure of £28.42 per available room compared to the same month a year earlier. Lower profit was caused by a drop in demand and weak average rate growth of 0.5% to £69.55, resulting in total sales down by 2.4% according to the study.

"Even in August, business demand remains crucial for branded chain hotels, which reported a significant year-on-year reduction in corporate and conference room lets. With British families taking fewer short breaks too, leisure demand was never going to compensate for the revenue shortfall," said TRI Hospitality Consulting deputy managing director David Bailey.

There were some regional bright spots, however, with average occupancy increasing by 7.2% to 73.1% in Liverpool, which TRI puts down to the city's Capital of Culture events. Average occupancy edged up in Newcastle by 1% to 80.1%, but in other major UK cities the occupancy trend was generally negative.

Meanwhile after the boost provided by the Farnborough Air show in July, the London market returned to the more moderate year-on-year growth levels reported in May and June. Daily IBFC increased by 2.1% to £49.69 per available room, driven by a 5.2% increase in achieved average room rate to £105.89.

"Changes in global financial markets are becoming increasingly volatile and dramatic. Given London's maximum exposure to such events, hotel performance has remained remarkably steady over recent months. Although down on last year, average rate growth is still ahead of 2005 and 2006 levels," said Bailey.

Have you registered with us yet?

Register now to enjoy more articles
and free email bulletins.

Register now
Already registered?
Sign in
5 ways to bounce back from travel sickness

5 ways to bounce back from travel sickness

Wellness expert John Ayo shares his health tips to make sure you and your event don't have to suffer.

What's the biggest challenge for corporate event planners?

What's the biggest challenge for corporate event planners?

Panel of experts at Cvent Connect examine what will affect in-house event professionals most during the next three years.

Marketing budgets cut for the first time in seven years, says Bellwether Report

Marketing budgets cut for the first time in seven years, says Bellwether Report

Total marketing budgets fell in the third-quarter amid economic and political uncertainty, but outlook for 2020 is positive.

Event agency wins Best Business award

Event agency wins Best Business award

Sleek Events hailed as 'outstanding with year-on-year growth' by Best Business Women Awards.

Case study: Unbound's festival of innovation

Case study: Unbound's festival of innovation

Light Fantastic produced the two-day showcase featuring immersive experiences, hackathons and talks.

The Creative Engagement Group hires three senior creative directors

The Creative Engagement Group hires three senior creative directors

Agency brings in new staff to strengthen its creative team for live experiences, communications, interactive and immersive content.

Why flexible working is vital for parents in events

Why flexible working is vital for parents in events

Modern approaches to work are good for staff wellbeing and business goals, says The Creative Engagement Group's Russ Lidstone.

What are the pros and cons of helicopter travel?

What are the pros and cons of helicopter travel?

A helicopter can help to solve many logistical issues and clients often love them - but keep an eye on the weather.

World Congress of Optometry 2021 set for Melbourne

World Congress of Optometry 2021 set for Melbourne

Eye health professionals bound for Australia to share global knowledge, experience and practices.

Planners reveal the types of food most wasted at events

Planners reveal the types of food most wasted at events

Almost a third of industry professionals admit to wasting a significant amount of food at events, new research reveals.

LATEST JOBS