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COVID-19 Webinar Summary: Five key points on Monthly P&L

STR recently launched Monthly P&L reporting, providing hotel operators an in-depth and timely look at profitability, which is especially valuable during the COVID-19 crisis. A summary of key points from the program’s introductory webinar is below.

Monthly P&L reporting based on four primary KPIs

While March 2019 KPIs provide a picture of profitability performance in a “normal” month, March 2020 KPIs demonstrate how COVID-19 has impacted hotel profitability, with EBITDA per available room down 116.8% year-over-year.

Monthly P&L - The KPIs

Vanishing group demand wipes out Other F&B Revenue

Other F&B Revenue, which includes meeting space rental, AV equipment rental, and service charges from the F&B department, declined 92.2% in March 2020.

Lack of groups dissolve Other F&B revenues

Full-service hotels struggle

Full-service hotel TrevPAR declined worse than 10 percentage points more than select-service hotel TrevPAR. This is reflected in class data, with the Luxury and Upper Upscale classes experiencing the largest profitability declines.

Limited-service holding up better than Full-service

Markets with early shutdowns, virus hotspots most impacted in March

New York and Chicago stand out from a profitability perspective. These union-heavy markets typically run high occupancies and have less flexibility in terms of staffing, leading to smaller profit margins and steeper profitability declines.

Markets impacted earliest by CV-19, most impact to revenues

Nearly 100% decline in profit margin in harder-hit markets

In New York and Seattle, every dollar earned in revenue corresponds to over $0.90 lost in profit.

Profit margins show greatest impact