Revenue slump for Abu Dhabi hotels

Abu Dhabi hotel profits per room dropped 6.9% year on year in May, according to the latest figures by HotStats. 

Abu Dhabi cityline
Abu Dhabi cityline

Efforts by properties across the emirate to reduce overheads were not enough to offset the slump, said the hospitality industry analyst.

HotStat’s May survey results revealed a 3.7% drop in revenue per available room (RevPAR), a decrease in food and beverage revenue (-11.1%) as well as drop in conference and banqueting (-25.4%) revenue on a per available room basis.

This contributed to a 7.8% decline in total revenue per available room (TrevPAR) in May.

While savings were made in terms of labour (-8.5%) and overhead (-4.8%) 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) fell 11.5% to US $83.61, but a respectable 33.4% profit conversion was achieved.

The survey also stated that hotels in Jeddah recorded a 47.6% 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% uplift in occupancy as well as a 24.5% increase in achieved average room rate, which contributed to a 42.9% increase in RevPAR.

Photo caption: Abu Dhabi hotel revenues slumped in May

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