6 MARCH 2002

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Across the board decline in hotel revenues, occupancy rates

- weak winter expected, summer indications ‘encouraging’

The Malta Hotels and Restaurants Association yesterday confirmed that the events of 11 September had taken their toll on the local tourism industry over last year’s fourth quarter, with the five-star category being the hardest hit through a marked drop in the lucrative conference and incentive business.

At the presentation of its quarterly Hotel Survey, the MRHA explained that five-star room occupancy rates over the period were some nine per cent lower than last year’s. As a result, five-star revenue for the last three months of 2001 was down by 13 per cent.

Nick Captur, a partner from Deloitte & Touche, said of the development, "This tarnished the relatively good results achieved by Malta’s five-star hotels earlier this year so that although revenue for the year as a whole still improved over the previous year, the momentum was obviously not sustained." Five-star revenue growth for the year stood at 2.5 per cent.

Speaking on the industry as a whole, MHRA President Tony Chircop commented, "It is expected that the first few months of 2002 will not show a significant improvement and the hotels are resigned to a fairly weak winter season.

"Our efforts are directed at ensuring, through the appropriate marketing and promotion strategies that the interest for Malta is further stimulated, and thus the forthcoming summer season turns out to be a positive one, and first indications are encouraging."

Meanwhile, the four-star sector of the industry had witnessed a relatively weak 2001, following the restructuring of the German market and the impact of 11 September. In fact, over last year’s fourth quarter, four-star occupancy levels were down by four per cent, while room rates were three per cent lower. The combined factors had led to a seven per cent decline in revenue. For the year as a whole four-star occupancy levels had declined by four per cent, but hotels held out for higher room rates than last year, so that for the 12 month period as a whole, revenues fell by around two per cent.

Likewise, the three-star industry also saw a decrease in both rates and occupancy levels over the fourth quarter, combining to reduce revenues by 23 per cent over the period. However for the year as a whole the results of this sector were fairly stable.

The quarterly Hotels Survey is conducted by Deloitte & Touche on behalf of the MHRA.

The Business Times, Network House, Vjal ir-Rihan San Gwann SGN 07
Tel: (356) 382741-3, 382745-6 | Fax: (356) 385075 | e-mail: editorial@networkpublications.com.mt