| Journal: TWUK | Section: |
| Title: | Issue Date: 04/09/00 |
| Author: | Page Number: 28 |
| Copyright: Other |
UKtrends 2000
Survey urges industry to act on profits slide
London: the city’s occupancy levels are 10 percentage points higher than the rest of the countryReport by LEE WINTER
THEUK hotel industry needs to take steps now to avoid a slide in profits next year, analysts claim in a survey published this week.The UK Trends 2000 survey, by Pannell Kerr Forster, studied the performance and profitability of a select 350 hotels over the past 12 months.
Director of hotel, leisure and tourism for the company Melvin Gold said: “We have had four or five years of constant growth and now we are seeing a slowdown. It is perfectly normal and while the strong pound has probably had a slight effect on occupancy and room rates, it is really a cyclical thing.
“Predictions of the underlying strength of the British economy mean that the hotel sector is likely to pick up as early as 2002.”
He said hoteliers would need to work harder after years of growth if they wanted to buck the current downward trend present in the market.
“Hoteliers will need to look at their pricing and the way they market themselves. That will push their business forward.”
Gold said that if hoteliers kept their eye on the ball, room occupancy would only slip by an average 1% and 2% next year.
The survey found that, while the hotel industry had recovered from the recession of the early 1990s, room occupancy and profits were starting to drop away following a peak in 1997.
Average occupancy levels in the the UK hotels reached a 19-year high in 1997/98 of 77.7%. By last year, this had fallen to finish the financial year at 75.8%, the report states.
In 1999/2000, London has remained the favourite UK destination with average occupancy levels 10 percentage points ahead of the rest of the country at 82.6% together with a higher room yield of £94.11.
Wales, in comparison, had the largest drop in occupancy falling 3.4% to 70.7% in the same period but saw prices for a room increase 2.9% to £54.33.