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Drop in hotel earnings as Ryder Cup effect wears off; ROOMS RATES FALL AFTER TOP PRICES FOR EVENT.

Byline: SION BARRY

DESPITE occupancy levels holding up, Welsh hoteliers experienced a significant fall in room yields in September compared to last year, shows latest research by PKF Hotel Consultancy Services.

While the 78% occupancy level in September 2010 was maintained, the average room rate in Welsh hotels fell 12.3% from pounds 63.74 to pounds 55.92 this year.

This large fall impacted upon room yield which saw a 12.3% fall from pounds 49.74 in September 2010 to pounds 43.62 this year."

The situation was particularly challenging for Cardiff hoteliers in September, with a drop in occupancy of 4.1% from 83.2% in 2010 to 79.8% in September.

Coupled with a significant 10.1% reduction in room rate from pounds 76.63 to pounds 68.88 year on year, Cardiff hotels also suffered from an overall decrease of 13.8% in their rooms yield from pounds 63.78 to pounds 54.97.

Swansea hotels also experienced a tough month during September - despite occupancy levels being up 3.4% from 76.8% in 2010 to 79.4% in September this year. Hoteliers in the city saw room rates fell 5.2% from pounds 60.68 to pounds 57.55. Overall, this saw the rooms yield fall by 1.9% from pounds 46.60 pounds 45.69 in September this year.

Tim Smith, partner in charge at the Cardiff office of PKF accountants and business advisers said: "The latest results are disappointing and suggest that Welsh hoteliers are being forced to slash their rates in order to attract visitors who are increasingly on the look-out for last minute deals and discounted rates. However, we should bear in mind that the latest statistics are being compared with figures from September last year when hotels in Wales were beginning to see the halo effect of the Ryder Cup Golf Tournament. The tournament, held in Newport at the beginning of October, allowed hotels in South Wales to command increased room rates.

"The industry will need to assess how best to respond to growing concerns about the health of the economy, the uncertain future of the eurozone, and declining consumer and business confidence."

For the UK as a whole occupancy went up from 78.1% in September 2010 to 79.8%, while room rates fell less than 0.1% from pounds 65.61 to pounds 65.58. This resulted in a boost to rooms yield, of 2.1% from pounds 51.28 to pounds 52.35.

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* Welsh hotels saw a fall in room yields in September compared with last year when top prices were asked close to the Ryder Cup
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Title Annotation:Business
Publication:Western Mail (Cardiff, Wales)
Geographic Code:4EUUK
Date:Dec 14, 2011
Words:443
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