April profit stays steady amid global pressures

Travel intent is yet to be dampened by higher cost of goods, the latest HotStats report has revealed. Despite record prices of gas, surging airfares and inflation, hotel performance stayed strong in April with increases in top and bottom line.

April GOPPAR in the U.S. touched US$96.08, achieving 92% of the pre-pandemic level. This was driven by a robust top line that featured both growth in occupancy and ADR, with ADR outdoing its April 2019 comparable, US$5 higher on a nominal basis. TRevPAR hit US$226, US$40 off where it was in April 2019.

Despite strong profits, expense pressure remains a concern. Total payroll continues to increase as labor shortages continue to impact hotels as the summer season approaches. Payroll stood at US$66.5 per available room in April, US$46 higher than in April 2020 but still about US$20 less than where it was before the pandemic.

Recovery in Europe

While Europe lagged behind the U.S. with regard to performance on a pure currency basis, performance continues to rise, showing a V-shaped recovery with most revenue and profit metrics after a dip from October 2021 to January 2022.

TRevPAR touched €142 (US$152.39) in April 2022, which was below the April 2019 comparable but still up 390% YOY, a result of the spike in RevPAR and ancillary revenue delivered by food and beverage.

GOPPAR was up to €40 (US$42.92) this April. While this is an improvement, it is still around €11 (US$11.80) off its pre-COVID comparable and a far cry from its April 2021 comparable when GOPPAR turned negative.

Impact of Expo 2020

After a promising performance in March in the Middle East, it dropped in April but was still delivering a strong month-over-month performance. Dubai saw performance climb new highs, on the back of the Expo 2020. But with the end of the six-month-long event, the Middle East will look for more ways to prolong its performance.

Across the region, occupancy fell 20 percentage points over the month prior, but ADR stayed high at US$245, the highest it has been in over four years and US$71 higher than April 2019.

ADR-led RevPAR totaled US$133, which was US$20 off March but US$2 higher than in April 2019.

Dubai RevPAR fell to its lowest since the start of the Expo 2020 and US$20 lower than in April 2019, with GOPPAR falling to US$106, US$22 lower than in April 2019.

A still strong top line led to solid bottom-line resulted in solid bottom-line numbers across the region, with GOPPAR of US$85 only US$2 less than its April 2019 comparable.

Lockdown in China

With parts of China still under lockdown, performance across the Asia Pacific took a hit. China GOPPAR was in a negative territory at (US$4.31) for the second consecutive month. However, after a two-month lockdown in Shanghai, the city is gradually moving to end it as of June 1.

After occupancy hit 65% in July 2021, it was recorded at 33% in April 2022, the lowest it has been since February 2021.