Overnight Hotel Stays Rose By 12.4% In February

28 March 2016 – Expansión

Hotel establishments recorded a total of 16.3 million overnight stays last month, up by 12.4% compared to February 2015.

During the first two months of 2016, overnight hotel stays grew by 10.4% with respect to the same period last year, according to figures released on Wednesday by the National Institute of Statistics (INE).

The increase in February was due to a 13.3% increase in overnight stays by non-resident visitors to Spain and a 11.2% increase in stays by residents. In addition, the average duration of stays in February amounted to 2.9 nights per user.

On the other hand, during the second month of 2016, 49.1% of all available places were occupied, which represented a YoY increase of 7.6%. Specifically, the occupancy rate on the weekend grew by 6.4%, to reach 57.2%. By region, occupancy rates in the Canary Islands were the highest, with an average of 77.9%, followed by Madrid (53.4%) and the Balearic Islands (48.9%).

The average daily rate (ADR) per occupied room amounted to €76.60, up by 7.9% compared with February 2015 and the revenue per available room (RevPar) amounted to €43.10, up by 16.5%.

By category, the average rate was €171.20 for five-star hotels, €80.70 for four-star hotels and €57.90 for three-star hotels.

Original story: Expansión

Translation: Carmel Drake

Meliá’s Profits Up By 18% Despite One-Off Impacts

26 February 2016 – Expansión

Meliá ended 2015 with a net attributable profit of €36 million, which represents a 18% increase compared with the previous year. The hotel chain said, however, that the two periods are not comparable, given that last year’s figures were affected by a higher tax rate, following the results of tax inspections launched in 2014 regarding corporation tax settlements made between 2009 and 2012.

In this regard, and in order to reflect the possible impact of these actions, Meliá made a provision amounting to €33 million. The hotel chain also clarified that having analysed the possible consequences in the years open to inspection, it does not expect any significant additional impact on the consolidated accounts in the future. “The company is cooperating with the authorities and hopes to reach a satisfactory agreement”, added the company in a document that it submitted to Spain’s National Securities Market Commission (CNMV).

Puerto Rico

Excluding extraordinary effects, such as a €29 million impairment on the Group’s hotel in Puerto Rico, and the provisions required for the aforementioned tax adjustment, Meliá’s net profit before tax amounted to €67 million, up by 200%.

In 2015, the company generated revenues of €1,738 million, which represents a 16% increase (compared with 2014).

The chain highlighted the strong performance of all its divisions in the hotel business, which allowed it to increase its revenues per available room (RevPAR) by 15.1%, thanks to the improvement in the general environment and economies in its key markets, as well as its strategy for branding and repositioning its products.

According to the financial plan, Meliá’s net debt amounted to €768.8 million at the end of the year, which represented a reduction of €216 million with respect to 2014.

Original story: Expansión (by Rebeca Arroyo)

Translation: Carmel Drake

Tinsa Heralds A New Era For The Hotel Sector

24 February 2015 – Expansión

More specialisation will be required to combat the maturity of the market.

According to Tinsa, the number of hotels has grown by 13.7% over the last seven years. By the end of 2014, there were 7,840 establishments and 1.26 million rooms in Spain.

In its Hotel Market 2014 study, prepared on the basis of the assessment of 2,700 establishments – 35% of the total market in Spain – the appraisal company states that the construction of a five star hotel requires an average investment of €262,000 per room, compared with €135,000 per room for a four star hotel, even though the number of rooms is typically similar in both cases – around 140. For three star accommodation, the investment required is around €89,000 per room. The report shows that profitability increases in line with the category. A five star hotel generates €29,600 per room per year, compared with €14,800 for a four star establishment. Revenue per available room (RevPar) is €117 for five star hotels and €60 for four star properties.

Tinsa indicates that, over the coming years, differentiation will become increasingly important. The hotel industry will undergo a similar transformation to that experienced by the airlines with the arrival of low cost competitors; some chains are already beginning to distinguish themselves with services such as mobile check-in.

Original story: Expansión (by Y. Blanco)

Translation: Carmel Drake