‘Volatile and fragile’ hospitality sector warned of poor summer

Occupancy and revenues among Scottish hotels fell for the second month in a row during April, with Edinburgh leading the downward trend, according to figures from accountancy firm PKF.

Across the UK, only Wales fared worse than the sector north of the Border.

Though hotel trade in Aberdeen boomed on the back of strong oil prices, it did not offset substantial declines elsewhere.

As a whole, Scottish hoteliers posted a 2.2 per cent decline in occupancy to 72 per cent, and a 0.7 per cent dip in room yields – the industry measure of revenue – to £44.99.

Alastair Rae, partner in hospitality at PKF, said the figures out of Edinburgh could indicate that a particularly tough summer season is on the horizon.

The capital’s hoteliers suffered a 4.2 per cent drop in occupancy despite price-cutting which pushed room yields 4.1 per cent lower to £48.13.

“Whilst this dip may be simply down to extremely poor weather during April, the strengthening pound may account for a loss of European and North American tourists which are essential for the tourist market in the capital,” Rae said.

“The coming months will indicate whether there is a deep-rooted problem in Edinburgh or whether this is a temporary blip.”

Declines in Glasgow – where occupancy and room yields were down by 3.5 and 1.7 per cent respectively – might have been linked to the “fluctuating fortunes” of the city’s key conference and concert markets, Rae added.

In contrast, Aberdeen saw a near-17 per cent surge in revenues on the back of a 4.3 per cent rise in occupancy, while Inverness benefited from early Easter “staycationing” which led to a 2.4 per cent rise in revenues.

Across the UK as a whole, occupancy remained steady at 69.9 per cent while room yields rose 3.2 per cent to £39.77.