North West Chain Hotels Market Review – April 2010

Cumbria comes out on top

In April, hotels in Cumbria experienced a 5.5 percentage point increase in room occupancy levels
according to the latest HotStats figures commissioned by my-hospitality from industry experts TRI Hospitality Consulting.

Merseyside and Greater Manchester also experienced increases in room occupancy levels of 2.1
percentage points and 0.8 percentage points respectively.

However, in terms of average room rate, Cumbria, Merseyside and Greater Manchester
experienced declines relative to last April. Lancashire was the only county in the region to
experience an increase, with an average room rate of £59.51, 6.0% above the performance last
April (£56.16). The decline in average room rates in five out of the six markets surveyed reflects
the ongoing challenging trading conditions and economic uncertainty. This uncertainty was
intensified in April as the country prepared itself for a General Election and successive
commentators highlighted the risk of a hung parliament to the country’s economic recovery.

Driven by the increase in room occupancy, Cumbria achieved an increase of 6.0% in Rooms
Revenue per Available Room (RevPAR) and Total Revenue per Available Room (TrevPAR)
increased 5.9% to £113.16. Due to the gearing effect of the substantial fixed hotel operating
costs, the 5.9% increase in TrevPAR resulted in a 12% increase in Gross Operating Profit per
Available Room (GOPPAR) to £35.84, making the county the most profitable in the region in
April 2010.

With the exception of Cumbria, all counties in the North West experienced a decline in
GOPPAR, with Merseyside experiencing the steepest decline of 8.6% to £31.04. Lancashire was
the least profitable county in the region in April with local hotels generating GOPPAR of £21.12,
down 3.6% from April 2009. In overall terms, GOPPAR in the North West declined 3.7%, from
£27.32 in April 2009 to £26.30 in April 2010.

According to Charles Scudamore, director, TRI Hospitality Consulting: “The growth in room
occupancy levels in Cumbria over a traditional holiday period reflects that the ‘Staycation’
phenomenon that started in the UK during 2009 has continued into 2010 due to the relative
weakness of sterling over the first four months of the year. However, there has been a softening
in the value of the euro in recent weeks brought about by the economic instability in some
Eurozone countries and visitor numbers could be affected if this trend continues.

With the UK and several European countries now set to enter a prolonged period of austerity, it is difficult to
predict whether or not the increase in leisure demand experienced by hoteliers in 2009 will be
sustained over the course of 2010.”