Hotels in the south reported an increase in occupancy levels in the last 12 months but room rates and yields have fallen, highlighting that the squeeze on consumer spending has continued to dent hotel performance, according to figures released by business advisory and accountancy firm BDO LLP.
Portsmouth hoteliers saw a 2.7% increase in daily room occupancy from 83.0% in June 2012 to 85.2% in June 2013. Despite this increase in occupancy, the price paid for hotel rooms has dropped 9.6% from £78.33 in June 2012 to £70.78 in the last 12 months, and room yields (the industry term for revenue) fell by 7.2% from £65.01 to £60.30.
Similarly, in Southampton room occupancy increased by 4.3% to 82.1% compared to 78.7% in June 2012. The average daily room rate also dropped by 1.2% to £55.85 from last year’s figures of £56.95. However rooms yield increased by 3.0% from £44.60 in the previous year to £45.93.
Chris Driver, Audit Director at BDO LLP in Southampton comments: “It is encouraging seeing operators across the South still performing well in terms of occupancy figures year-on-year, although this appears to have been achieved by having to discount rates against the backdrop of a continually competitive marketplace and the gradual recovery in the economy.
“Despite a challenging 12 months, the industry has made good progress in Q2 2013. Month-on-month, Portsmouth hotels have seen revenues and yields improve. Occupancy levels have also increased from 75.5% at the end of Q1 to 85.2% at the end of Q2.”
Chris Driver adds: “It appears that the bank holiday season and good weather has treated hoteliers kindly in the last quarter. The market remains challenging, but the sector is, as always, putting up a strong fight.”
