November HotStats Data Reveals Further Profit Strain in the United States and Abroad

coronavirus economic impact

LONDON — HotStats recently released its global hotel performance data for November, revealing that the hotel industry is still reeling from the effects of the pandemic.

United States Backtracks

After multiple months of negative GOPPAR, the United States pulled into positive profit territory in October only to relapse in November, falling back into negative numbers at -$3.05—a 103.4 percent decrease compared to the same time last year.

November occupancy was down 4 percentage points over October to 24.2 percent, and—coupled with an average rate at $143.74—produced RevPAR of $34.76, down more than 78 percent year-over-year (YOY) and 15 percent over the month prior. October is historically a stronger month for U.S. hotel performance than November. November TRevPAR was down 79 percent YOY to $54.07.

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Ancillary revenue continued to suffer. Total F&B revenue on a per-available-room basis remained below $10—a nearly 90 percent decrease YOY. HotStats noted in its report that many cities—including New York, Washington, D.C., Philadelphia, and areas across California—implemented indoor-dining bans in December, which is expected to further worsen F&B revenue. However, carry-out and delivery, though not making up for the shortfall, are thriving. UBS Evidence Lab found that dine-in restaurant sales plunged 69 percent in the week ended November 29; however, in that same week, carry-out and delivery sales rose 59 percent.

Labor costs remained around the $30 level on a per-available-room basis in November—68.5 percent less than at the same time a year ago. Overhead costs jumped $6 in November over October, but was still down more than 55 percent YOY.

Profit margin clocked in at -5.7 percent, illustrating how much revenue has been lost and despite cost savings.

Profit & Loss Performance Indicators — Total U.S.

Key Performance Indicator (KPI) 

Nov. 2020 vs. Nov. 2019

YTD 2020 vs. YTD 2019

RevPAR

-78.4% to $34.75

-67.9% to $54.97

TRevPAR

-79.2% to $54.07

-67.7% to $86.93

Labor PAR

-68.5% to $30.29

-51.0% to $46.85

GOPPAR

-103.4% to -$3.05

-93.3% to $6.67

Europe Regresses

After pushing out two months of positive profit in August and September, October dipped below zero with the trend continuing in November, at an even deeper cut. November GOPPAR was -€12.51, a regression of 151 percent over October and 120.2 percent YOY.

After demand crept higher in the previous three months, November occupancy clocked in at 15.4 percent, almost 10 percentage points lower than October and 60.5 percentage points lower than at the same time last year. The decrease in occupancy—coupled with rate dropping below triple digits for the first time since June—resulted in RevPAR diminishing to €14.03, an 87.9 percent YOY decrease. As a result of the drop in rooms revenue, total revenue took a hit as well, dropping to €23.95, an 86.8 percent decrease over the same time a year ago and 47 percent less than October.

Labor costs dropped in step with November’s decrease in revenue, down to €19.38, a 66 percent decrease YOY. All undistributed expenses remained well lower than the year prior, highlighted by a 42.5 percent drop in utility costs.

Profit margin was down to -52.2 percent, the worst it’s been since June when it was recorded at -84.3 percent.

Profit & Loss Performance Indicators — Total Europe (in EUR)

KPI

Nov. 2020 vs. Nov. 2019

YTD 2020 vs. YTD 2019

RevPAR

-87.9% to €14.03

-71.8% to €34.30

TRevPAR

-86.8% to €23.95

-69.1% to €55.50

Labor PAR

-66.0% to €19.38

-47.8% to €28.58

GOPPAR

-120.2% to -€12.51

-100.2% to -€0.15

Asia Pacific Steady

Compared to the rest of the world, the Asia Pacific hotel industry remains the lodestar everyone is starting up at, according to HotStats. Though revenue and profit still remain well off historical comps, the region has only recorded three months of negative GOPPAR, which occurred at the outset of the pandemic. Since June, APAC has recorded six consecutive months of positive profit.

November was no exception. Though it didn’t reach October heights, November GOPPAR of $23.87 was the second-highest amount since operational performance foundered from COVID. It’s still a 62.9 percent YOY decrease.

Occupancy continued its steadiness, holding around 50 percent. A room rate north of $100 led to RevPAR of $50.58, which was still down 47.9 percent YOY. Though business travel has suffered enormously since the pandemic, APAC bucked the trend in November, recording an actual uptick in volume, increasing 3.7 percentage points over the same time last year to 20.7 percent.

Enervated ancillary revenue kept TRevPAR below triple digits and 44.7 percent off versus the same time last year.

Expenses were down across the board YOY; however, total labor costs have risen steadily since June, though are still well down over the prior year.

Profit margin was 24.7 percent, 12.1 percentage points lower than at the same time a year ago.

Profit & Loss Performance Indicators — Total APAC (in USD)

KPI

Nov. 2020 vs. Nov. 2019

YTD 2020 vs. YTD 2019

RevPAR

-47.9% to $50.58

-56.5% to $40.86

TRevPAR

-44.7% to $96.77

-53.9% to $75.00

Labor PAR

-34.4% to $31.01

-36.4% to $29.79

GOPPAR

-62.9% to $23.87

-80.1% to $11.08

Middle East Above Water

The hotel industry in the Middle East region stayed afloat in November, recording its highest RevPAR and TRevPAR since the pandemic debilitated the region, at $55.11 and $97.49, respectively. Both are still off more than 50 percent versus the same time last year.

The escalating performance on the revenue side led to a high in GOPPAR, which hit $18.52, the highest the data point has reached since February, when GOPPAR was $73.24. Ensuing months of negativity followed, with profit only pulling back into the black as of August.

Like APAC, the Middle East got a boost in corporate travel, which was up 2.5 percentage points in occupancy in the month versus the same time last year. Leisure volume mix was down 2.3 percentage points YOY.

Profit margin for the month was up to 19 percent, its highest since February and 3.1 percentage points higher than October, signifying both revenue gains and expense containment.

Profit & Loss Performance Indicators — Total Middle East (in USD)

KPI

Nov. 2020 vs. Nov. 2019

YTD 2020 vs. YTD 2019

RevPAR

-55.6% to $55.11

-54.2% to $51.88

TRevPAR

-55.0% to $97.49

-54.2% to $89.17

Labor PAR

-36.0% to $35.96

-34.9% to $36.33

GOPPAR

-78.8% to $18.52

-80.3% to $13.62

 

 


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