Abu Dhabi hotels see further dent in revenues in May

Latest HotStats data also shows profit per room in UAE capital has slumped nearly 7% year-on-year
Abu Dhabi hotels see further dent in revenues in May
By Staff writer
Sat 09 Jul 2016 12:25 AM

Hotels in Abu Dhabi were unable to offset the decline in revenue across the major operating departments in May despite significantly reducing both overhead and labour costs, according to latest data from HotStats.

As a result, year-on-year profit per room for hotels in the UAE emirate dropped by 6.9 percent, figures showed.

The HotStats survey showed that in addition to a 3.7 percent drop in revenue per available room (RevPAR), a decrease in food and beverage (-11.1 percent) as well as conference and banqueting (-25.4 percent) revenue on a per available room basis, contributed to a 7.8 percent decline in total revenue per available room (TrevPAR) in May.

It added that while savings were made in labour (-8.5 percent) and overhead (-4.8 percent) costs, hotels in Abu Dhabi suffered further year-on-year declines in profit per room in 2016 and year-to-date.

Gross operating profit per available room (GOPPAR) has now fallen by 11.5 percent to $83.61. Despite this, hoteliers are still maintaining a respectable 33.4 percent profit conversion, HotStats said.

The survey also said that hotels in Jeddah recorded a 47.6 percent year-on-year uplift in profit per room in May as high volume levels as a result of key events enabled hoteliers to leverage top line performance.

Events such as the FM Expo, Outdoor Design & Build Show and The Hotel Show enabled hoteliers in the Saudi capital to record a 10.8 percent uplift in occupancy as well as a 24.5 percent increase in achieved average room rate, which contributed to a 42.9 percent increase in RevPAR. 

It was a welcome uplift in performance for hotels in Jeddah, which have suffered consecutive months of profit decline since September 2015, contributing to a 12.7 percent drop to $148.21 in the 12 months to April 2016. 

Despite year-on-year growth in May, year-to-date GOPPAR at hotels in Jeddah remains 9.8 percent behind 2015 performance at $132.84.

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