Scotland's hotels see profits rise

In recent months, following a vote to remain part of the UK and hosting the Commonwealth Games, Scotland's hotels have seen an notable increase in profitability.

By the Numbers

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Hotel Optimization Part 3 | January 27, 2021

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Scottish hoteliers saw a 27.3 percent surge in gross operating profit per available room (the Total Gross Operating Profit for the period divided by the total available rooms during the period) according to the latest data from HotStats. With occupancy remaining virtually flat, hotels in Scotland increased average room rate (ARR) by 21.7 percent, resulting in rooms revenue per available room climbing by 21.6 percent to £98.56. 

Besides food and beverage, all non-rooms departments recorded positive performances leading to a 13.6 percent growth in total revenue per available room (TRevPAR).

"Astute payroll and operating cost control" (as HotStats phrased it) helped to enhance departmental operating profit per available room (DOPPAR) by 20.0 percent to £97.97, and while overheads per available room jumped by 7.3 percent, GOPPAR went up by 27.3 percent to £67.74.

City by City

According to the Herald Scotland, Glasgow saw a 73.3 percent boost to revenue in July thanks to the Commonwealth Games. Room yield increased year on year from £45.31 to £78.53 as tens of thousands of spectators converged on the city for the sporting spectacle.

The Glasgow 2014 host city also saw a boost to hotel occupancy of 4 percent, up to 88.5 percent, according to the figures from accountants BDO LLP.

While Glasgow's numbers were strong, other Scottish cities saw downturns:  Edinburgh fell 1.5 percent, despite remaining the top city in Scotland for room yield at £81.86. Inverness also dropped 4.6 percent from £59.24 to £56.53, while Aberdeen's business community provided a boost of 7.8 percent from £69.85 to £75.27. Edinburgh, along with Aberdeen and Inverness, saw a drop in occupancy rates, falling by 4.8, 2.1 and 6.3 percent respectively. Still, Edinburgh reported the second-highest revenue in the UK after Oxford.