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Hotel brands cut losses drastically in Q1 2021
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Posted by Hoteliersweb . - Filed in News - 4,599 views
Hotel groups cut losses drastically in Q1 2021
Hilton, IHG, Accor, Wyndham, Marriott and Hyatt have all claimed a strong start to the year.
The world's largest hotel groups, namely Hilton, IHG, Accor, Wyndham, Marriott and Hyatt, have all revealed their first quarter results for the year. Some fared better than others, with a handful seeing costs creep up and others managing to close the gap.
While the figures were a farcry from early 2020 and 2019 results, they still tended to be going in the right direction, with all the hotel bosses agreeing they had seen a strong start to 2021.
Read on for the financial results and outlooks for the industry's largest companies.
Accor
Revenues: €361 million (US$439 million)
RevPAR drop: 52.38 percent YOY
Accor's quarter one report shows the French hotel group made €361 million in the first three months of the year, a 48 percent drop in revenue compared to the same period in 2020.
During the first quarter, RevPAR fell by 64.3 percent versus Q1 2019 and 52.38 percent YOY, reflecting an environment that remains hard hit by the Covid-19 pandemic. There were, however, significant year-on-year improvements in South Europe, Australia, the Middle East and North America.
Sébastien Bazin, chairman and CEO of Accor, said: “There were no surprises in our first-quarter performance. Global business trends are improving slightly and the ramp-up of the vaccine roll outs bode well for a particularly strong rebound. As it did in 2020, the group continues to keep a close eye on protecting its cash and cutting costs. Today, all our efforts are focused on the strong recovery expected this summer.”
Hyatt
Net loss: $304 million
RevPAR drop: 48.9 percent YOY
Despite a net loss of $304 million in the quarter, Hyatt’s CEO and president Mark Hoplamazain said the results were better than expected.
He said: "First quarter results exceeded expectations as demand improved meaningfully over the course of the quarter. The expansion of vaccine distribution and the easing of travel restrictions in certain markets fuelled improved confidence in travel in many of the markets in which we operate.”
Adjusted EBITDA decreased 123.3 percent YOY in Q1 2021 to a loss of $20 million, RevPAR meanwhile fell 48.9 percent compared to Q1 2020 and 65.4 percent compared to Q1 2019.
Wyndham
Net income: $24 million
RevPAR drop: 11 percent YOY
Wyndham’s results were up over Q4 2020 figures but revenue was still down against the first quarter of last year.
Revenues in Q1 2021 hit $303 million for the US franchising giant, down from the $410 million seen in Q1 2020. However, it is a slight improvement over the $296 million collected in Q4 2020.
Global RevPAR dropped 11 percent YOY and 31 percent against Q1 2019, while adjusted EBITDA clocked in at $97 million.
Net income actually increased from $22 million in 2020’s first quarter to $24 million this quarter, attributed to the company’s cost mitigating throughout the pandemic.
“We were very pleased to see our development pipelines grow sequentially, both domestically and internationally, and our room openings and deletions improve year-over-year. We were also encouraged to see conversion room openings increase year-over-year, representing over 70 percent of total openings this quarter," Geoffrey A. Ballotti, president and chief executive officer.
Hilton
Net loss: $109 million
RevPAR drop: 38.4 percent YOY
Net loss in the quarter stood at $109 million, well below the net income of $18 million in Q1 2020, but above the $225 million loss in the final quarter of the pandemic-struck 2020. Hilton also outperformed fellow US hotel group Hyatt, which saw losses amount to $304 million in Q1 2021.
System-wide comparable RevPAR shows a similar story, decreased 38.4 percent YOY, though still up from the 59.2 percent drop seen by the end of December last year. ADR and occupancy rates fell 23 and 11 percent respectively in Q1 2021, clocking in at $105.38 and $43.9. Adjusted EBITDA was $198 million for the first quarter
Looking at the MEA region specifically, it outperformed Europe across the board, with occupancies hitting 42.6 percent compared to 19.3 percent in Europe; ADR hitting $124.56 compared to $81.59; and RevPAR hitting $53.12 compared to $15.74.
One interesting result is that the Waldorf Astoria brand was the only one across the entire group to see positive ADR growth in 2021, managing to reach $573.77, an improvement of 26 percent.
IHG
Net loss / revenues: N/A
RevPAR drop: 33.7 percent YOY
IHG Hotels and Resorts revealed decreases across all KPIs as the pandemic lingers on.
Group RevPAR was down 50.6 percent compared to Q1 2019 and 33.7 percent compared to Q1 2020. Across a network of 5,398 hotels, RevPAR averaged at $35.55. ADR and occupancy fared slightly better, with ADR down 22.1 percent compared to 2019 and 20.4 percent compared to 2020, hitting $88.79. Occupancies were down 23.3 percent compared to 2019 and eight percent compared to 2020, hitting 40 percent.
The group’s CEO Keith Barr said: “Trading continued to improve during the first quarter of 2021, with IHG maintaining its outperformance of the industry in key markets and seeing strong performance in openings and signings as we expand our brands around the world. There was a notable pick-up in demand in March, particularly in the US and China, which continued into April. While the risk of volatility remains for the balance of the year, there is clear evidence from forward bookings data of further improvement as we look to the months ahead.
“As the rollout of vaccines becomes more established, travel restrictions lift, and economic activity rebuilds, traveller demand will continue to grow and generate further momentum in an industry recovery over the course of the year. Coupled with our resilience as a business and the important work we’re doing to support our owners, develop our brands and expand our pipeline, we’re confident that IHG is well positioned for sustained growth.”
Marriott
Net loss: $11 million
RevPAR drop: 46.3 percent YOY
Marriott reported operating income totalled $84 million in the 2021 first quarter, compared to 2020 first quarter reported operating income of $114 million. Reported net loss totalled $11 million in the 2021 first quarter, compared to 2020 first quarter reported net income of $31 million.
While figures are down YOY, they are still a significant improvement over the last quarter, where net losses hit $164 million. First quarter 2021 adjusted net income totalled $34 million, compared to 2020 first quarter adjusted net income of $160 million.
Worldwide RevPAR declined 46.3 percent compared to the 2020 first quarter.
Source: Hoteliermiddleeast.com, Marriott, Hyatt, Wyndham, Accor, Hilton & IHG News release
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