Three-star hotel profits shoot up by 71% in 2014

Three-star hotels reported a massive 71.4% profit increase in 2014 when compared with 2013. A hotel survey carried out by  the Malta Hotels and Restaurants Association shows that three-star hotels reported a gross operating profit per available room (GOPAR) of €4,552 in 2014, compared with €2,638 in 2013.

The GOPAR also increased by 17.4% to €15,045 for five-star hotels and by 19.8% to €8,871 for four-star hotels. 

The survey results also show that tourist arrivals in 2014 increased by 6.8% when compared with 2013. Collective accomodation visits increased by 6%, while private accomodation visits increased by 9.1%. 

Overall guest nights increased by 4.9%, with nights in private accomodation increasing by 9.2% and nights in collective accomodation increasing by 2.8%. 

All hotel sectors reported increased occupancy rates, with the average occupancy of five-star hotels standing at 74.2%, of four-star hotels at 77.7% and of three-star hotels at 67.5%.

Occupancy and profit improvements were also recorded during the fourth quarter of 2014, when compared with the corresponding period the previous year. 

MHRA President Tony Zahra warned hoteliers not to consider these results as an end game but as a beginning, and urged them not to decrease their rates. 

While he welcomed the upcoming 25% reduction in electricity bills for businesses, he insisted that the reduction should be closer to 50%.

"The upcoming reduction will be based on last year's circumstances and circumstances have changed," Zahra said. "Low electricity bills are crucial to the economy, and if we don't become more competitive we'll remain stuck as also-rans.

He also lamented the state of Enemalta's power grid that leads to frequent power cuts, as well as the "rubbish" state of Maltese roads.