H EU Report Europe APRIL 2016
ANALYSIS OF HOTEL RULTS APRIL 2016 Europe's hotel industry improves overall, despite a deepening gap Across the continent, the month of April allowed hoteliers to post the best results since the beginning of the year. However, this glimmer of hope should not overshadow the significant gap between markets experiencing full growth such as Germany and Central Europe and destinations that are suffering from worsened security conditions, with Belgium and France in the lead. In pursuit of the positive results produced in recent months and driven by the renewed dynamism of several major markets, Europe's hotel activity continued its climb last month, producing a Revenue per available room (RevPAR) up by 4.8% in April 2016 compared to the previous year. While renewed arrivals have been satisfactory on a continental scale, with growth by 0.9 point in occupancy rate, it is above all daily rates that allowed hoteliers to benefit from this Spring renewal. Up significantly across all categories, rates have progressed by 3.4% over April 2015. The 2* hotels benefited the most from this uptrend ( daily rates +5.1%), also enabling the category's properties to report the strongest growth in results (RevPAR +8.0%) last month. April stands out for the powerful contrasts between the different markets. The major Central markets drove business last month: Germany produced its traditional biannual improvement (which will be made up for by a drop next month), with a RevPAR up significantly (+27.5%) driven at once by an increase in daily rates and a much higher occupancy rate than 2015. Neighboring Poland also ranks among the leaders on Europe's markets, with growth in its properties' RevPARs by 23.2%. In keeping with good results produced since the beginning of the year, the country has confirmed its ability to drive hotel results up. In other contexts, Spain (+11.7% RevPAR), Hungary (+11.9%) and Luxembourg (+13.4%) all continue to be sure values in terms of hotel performances. Not very surprisingly, French, and above all Belgian, markets have not benefited from the overall improvement of hotel results in Europe, a drop that is explained by the terrorist attacks that hit the two countries in recent months. With a RevPAR down by 9.4% compared with the month of April 2015, French hotels recorded their worst results since the tragic events of last November. Also shaken by attacks that caused 32 deaths and nearly 350 wounded in Brussels last March 22, Belgium's hotels sadly experienced their share of the human shock experienced in the Netherlands. The RevPAR at Belgian properties is down 16% with respect to April 2015, despite a slight increase in daily rates that could not offset the disinterest of clientele, which brought a 14.6 point drop in occupancy rate with respect to last year. Since the beginning of the year, Belgian and French hoteliers are unsurprisingly the only ones to produce durably negative results. In Belgium, the RevPAR for hotels is down by 7.5% between January and April 2016, in France it was -4%. These results make a clean break with those obtained elsewhere on the continent, particularly in Central Europe. As far as concerns the gains in terms of RevPAR, the Visegrad Group, including Poland (+10.8% since the beginning of the year), the Czech Republic (+12.5%) and Hungary (+10%), continue excellent growth begun in 2015 - these levels nonetheless remain lower at properties in Western Europe in terms of absolute value. Spanish and Dutch hotels also do well, with particularly positive growth in their RevPAR since the beginning of the year 2016, with a 16% increase in Spain and 11.6% growth in the Netherlands in the first four months of the year. Produced by 2
HOTEL RULTS BY SEGMENT MONTHLY RULTS Occupancy Rate Average Daily Rate ( V excl) RevPAR ( V excl) (pts) (%) (%) 2* 2,0 5,1% 8,0% 3* 0,5 2,6% 3,3% 4* 1,3 4,9% 6,8% 5* -1,7 0,7% -1,9% Global 0,9 3,4% 4,8% YTD RULTS Occupancy Rate Average Daily Rate ( V excl) RevPAR ( V excl) (pts) (%) (%) 2* 0,7 2,1% 3,2% 3* 0,9 0,6% 2,0% 4* 0,5 2,1% 3,0% 5* -1,2 2,0% 0,1% Global 0,5 1,5% 2,3% Note : The indicators are compared to the same period of previous year, i.e. APRIL 2015 vs APRIL 2014 OR, ADR and RevPAR change - Last 24 months 15% 13% 11% 9% 7% 5% 3% 1% -1% -3% -5% 05/14 06/14 07/14 08/14 09/14 10/14 11/14 12/14 01/15 02/15 03/15 04/15 05/15 06/15 07/15 08/15 09/15 10/15 11/15 12/15 01/16 02/16 03/16 04/16 Changes ADR Changes OR Changes RevPAR Produced by 3
Monthly Results - RevPAR change by country APRIL 2016 vs APRIL 2015 +4.8% +5.6% -9.4% NL +7.5% -16.0% +13.4% +27.5% +3.0% +0.0% +23.2% +11.9% +11.2% Sup. to 10% +5.9% Between 5% and 10% Between 0% and 5% +3.0% +11.7% +7.4% -23.4% Inf. to 0% +7.1% Produced by 4
Monthly Results Occupancy Rate change by country APRIL 2016 vs APRIL 2015 +2.0 pts NL -0.8 pt +8.8 pts +0.9 pt -3.4 pts -14.6 pts +3.4 pts +7.2 pts -2.1 pts +3.5 pts +0.8 pt +4.9 pts Sup. to 5 pts +2.9 pts Between 2,5 and 5 pts Between 0 and 2,5 pts -0.5 pt +3.4 pts +6.6 pts -12.7 pts Inf. to 0 pt -1.1 pt Produced by 5
Monthly Results - ADR change by country APRIL 2016 vs APRIL 2015 +3.4% +2.9% NL +8.6% +3.8% +8.3% +15.3% +6.2% +8.8% -5.0% -4.5% +10.8% +3.2% Sup. to 10% +1.7% Between 5% and 10% Between 0% and 5% +3.6% +6.5% -3.6% -7.2% Inf. to 0% +8.7% Produced by 6
YTD Results - RevPAR change by country YTD APRIL 2016 vs YTD APRIL 2015 +0.7% NL +11.6% +10.8% +2.3% -4.0% -7.5% +6.3% -1.7% +7.6% +12.5% +3.9% +10.0% Sup. to 10% Between 5% and 10% Between 0% and 5% +6.6% +16.1% +2.8% +0.1% -15.9% Inf. to 0% +13.5% Produced by 7
YTD Results Occupancy Rate change by country YTD APRIL 2016 vs YTD APRIL 2015 +0.1 pt NL +2.1 pts +3.1 pts +1.7 pt +0.5 pt -6.0 pts +1.8 pt +1.5 pt +2.4 pts +1.8 pt -1.2 pt -0.2 pt Sup. to 5 pts +2.0 pts Between 2,5 and 5 pts Between 0 and 2,5 pts +1.1 pt +4.4 pts +0.6 pt -7.6 pts Inf. to 0 pt +0.6 pt Produced by 8
YTD Results - ADR change by country YTD APRIL 2016 vs YTD APRIL 2015 +0.6% NL +8.1% +4.9% +5.2% +1.5% -2.6% +1.5% +3.5% -1.4% +9.4% -0.1% +6.8% Sup. to 10% Between 5% and 10% Between 0% and 5% +4.7% +8.5% -0.5% -1.0% -4.9% Inf. to 0% +12.4% Produced by 9
1 Conventions METHODOLOGY The report presents the results of corporate brand hotels in Europe. The sample consists of a total of more than 6,500 hotels, representing more than 800,000 rooms. The breakdown by segment is as follows: 30% for Budget and Economic hotels, 30% for midscale hotels and 40% for upscale hotels. Hotels are classified according to the hotel star system: from 1* to 5*. The category of corporate chain hotels are allocated individually according to MKG Hospitality s market expertise and reflect the marketing classification in complement to the official rating system(s) of the country (if any). The category breakdowns for global supply are taken from MKG Hospitality s database and from information provided by statistical and/or hotel industry institutions (e.g. associations, unions). 2 Glossary ooccupancy rate: Number of sold rooms divided by number of available rooms o Average daily rate: Room revenue divided by number of sold rooms orevpar: Occupancy rate x daily price or room revenue divided by available rooms oavailable rooms: Capacity x number of operating days (within a month) osold rooms: Capacity x number of operating days x occupancy rate oroom revenue: Room revenue expressed net of V (excluding other types of revenue such as food and beverage, etc.) Produced by 10