~ KPMG releases survey results ~
PHILIPSBURG--KPMG's 2011 Caribbean Hotel Benchmarking Survey showed clearly that the Caribbean hotel industry continues to operate in difficult times with challenges of lower daily rates, falling visitor spending and higher operational cost leading to reduced profitability in 2010. Most properties do not foresee real growth for another two years.
KPMG in St. Maarten, together with KPMG member firms in the Caribbean, released the results of the 2011 Caribbean Hotel Benchmarking Survey this week. The survey analyses 2009 and 2010 financial and operating statistics for hotel properties across the Caribbean, Dutch Caribbean included.
The year 2010 generally showed mixed results when compared to 2009, with increased occupancy levels, but lower profitability. Approximately two-thirds of participating hotels reported that 2010's performance did not meet budget. Profitability was also affected due to a decrease in guest expenditure on discretionary/incidental items and increases in expenses related to other operated departments, utilities, management fees and fixed cost.
Most hotels in the survey believed 2011 would be better than 2010, but that meaningful growth would not return until possibly as late as 2013. Less than 10 per cent surveyed was not very optimistic about 2011's prospects, while more than 60 per cent was moderately optimistic.
According to the survey, in an effort to maintain rates and occupancies, nearly 45 per cent of hotels are using revenue enhancement (up-selling, cross-selling, improving reservation systems, etc.) as their primary performance improvement tool for 2011, followed by cost-cutting measures at just over 20 per cent.
The survey also indicated that slow economic recovery, particularly in the main source markets for visitors, was seen as the primary hindrance to a rebound in the Caribbean tourism industry. Nearly half of the hotels surveyed believed a turnaround in the economy would be the main indicator of a return to growth.
"Given the difficult operating climate over the last few years, an overwhelming majority of reporting hotels do not believe there is enough regional government leadership to make the changes they think are needed within the tourism industry. Specific concerns noted include the lack of investment in the industry by some jurisdictions and the general cost and availability of airlift," KPMG noted.
The survey also referred to a number of relevant quotes from managements of the hotel properties surveyed. These quotes included: "Until governments fully appreciate the importance of the sector, not just in direct employment and construction, but the ancillary services such as accounting and insurance, their policies will never address the core problems in the sector."
The survey results will be available for download at
www.kpmg.com/dutchcaribbean . For questions or to arrange participation in future surveys, contact KPMG Managing Director Corporate Finance Henk de Zeeuw at
dezeeuw.henk@kpmg.an .
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