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The first quarter of 2022 holds good prospects for the hospitality sector

After two years deeply marked by the health crisis, the hospitality sector seems to be recovering, as shown by the first quarter results of the world's major hospitality groups. All the signals seem to have turned green, both in terms of occupancy rates and RevPAR, indicating a clear recovery in tourism throughout the world.

Expedia recently released its review of the tourism trends it has seen in the first quarter of 2022. During this period, global search volume increased by 25% compared to the previous quarter, driven by double-digit growth in North America (NORAM) at 30% and Europe, Middle East and Africa (EMEA) at 25%. Compared to Q1 2021, global search volume is up 75%.

Global bookings for hotels and holiday rentals combined were up 35% from the previous quarter, with all regions experiencing at least double-digit growth in the first quarter. In the first quarter, 15 of the top 25 global destinations experienced double-digit growth in hotel bookings compared to the previous quarter. The length of stay for accommodations worldwide remained stable between Q4 2021 and Q1 2022, at 2 days for hotel stays and 5.5 days for holiday rental stays.

This recovery in bookings has enabled the major actors in the hospitality sector to become profitable again. This is particularly the case for TUI, whose underlying loss before interest and tax (Ebit) has been reduced to €330 million, almost half the loss recorded in the same period last year. The group's current turnover is €2.13 billion and the group's chief executive expects TUI's capacity to be almost at pre-pandemic levels this year.

Accor has announced revenues of €701 million for the first quarter of 2022, up 85% like-for-like compared to the first quarter of 2021. By activity, this growth breaks down into a 105% increase in hotel services and a 52% increase in hotel and other assets. The changes in the scope of consolidation (acquisitions and disposals) made a positive contribution of €13 million, largely due to the integration of the companies that are now part of Ennismore over 2021. Accor's business has rebounded sequentially each quarter since Q2 2021. In the first quarter of 2022, Accor opened 26 hotels, representing approximately 3,700 rooms, representing net network growth of 2.5% year-over-year.

IHG's RevPAR increased by 61% compared to the same period in 2021, reaching 82% of the level recorded in 2019. Average price increased by 27% compared to the same period in 2021, reaching the 2019 level. The Americas and EMEAA saw sequential improvement in February and March after a difficult January, while Greater China's activity was affected in March by tighter local travel restrictions. Net network growth was +3.4% with 120 hotels signed during the quarter, representing 16,600 new keys.

Wyndham Hotels & Resorts reports strong first quarter 2022 results with net income of $106 million, or $1.14 per diluted share, and an increase of $82 million, or $0.88 per diluted share, reflecting higher adjusted EBITDA. Adjusted EBITDA increased by $62 million, or 64%, to $159 million compared to 2021. Group RevPAR is up 39% compared to the first quarter of 2021, including 38% growth in the US and 46% growth internationally. As at 31 March 2022, the group's global development pipeline comprised approximately 1,600 hotels and approximately 204,000 rooms, of which approximately 80% were in the mid-market and upper segments. The pipeline increased by 9% between 2021 and 2022, of which 12% was domestic and 7% was international.

Marriott's reported operating income was $558 million in the first quarter of 2022, compared to a reported operating income of $84 million in the first quarter of 2021. While reported net income was $377 million in Q1 2022, compared to a reported net loss of $11 million in Q1 2021. Global RevPAR in Q1 2022 increased 96.5% compared to Q1 2021. RevPAR in the US and Canada increased by 99.1%, and RevPAR in international markets increased by 88.5%. The group added 75 properties, or 11,799 rooms, to its global lodging portfolio during the first quarter of 2022, including more than 2,500 rooms converted from competing brands and approximately 5,300 rooms in international markets. At the end of the quarter, the company's global development pipeline totaled 2,878 properties with more than 489,000 rooms, including 998 properties under construction and 127 properties that have been approved for development but are not yet under contract.

Net loss attributable to Hyatt was $73 million in the first quarter of 2022, compared to a net loss attributable to Hyatt of $304 million in the first quarter of 2021. International RevPAR increased 107% and t U.S. hotel RevPAR increased 126% in Q1 2022. Owned and leased hotel RevPAR increased 217% and owned and leased hotel operating margin improved to 26.9%. RevPAR grew significantly in the first four months of the year, January was 37% below 2019 and improved to 9% below 2019 in April. Net room growth was 18.6% over the period. The pipeline of executed management/franchise agreements increased by 13% to around 113,000 rooms.

Choice Hotels' revenue increased 41% over the same period in 2021 to $257.7 million in Q1 2022. Net income increased by $45.1 million to $67.4 million in the first quarter of 2022, an increase of 200% over the first quarter of 2021. Adjusted EBITDA margin for the first quarter of 2022 was 74%, an increase of 470 basis points compared to the same period in 2021. Nationwide RevPAR increased 10.4% for the first quarter of 2022, compared to the same period of 2019, and outpaced the industry as a whole by 13 percentage points. National RevPAR growth exceeded 2019 levels for ten consecutive months through March 31, 2022, a trend that continued into the second quarter of 2022 with April RevPAR increasing by approximately 16%, compared to April 2019. RevPAR for the full year 2022 is expected to increase between 10% and 13%, compared to the full year 2019. The Group's total national pipeline of hotels awaiting conversion, under construction or approved for development, as of 31 March 2022, reached 864 hotels, representing nearly 78,000 rooms, a 3.5% increase in rooms compared to 31 December 2021.

NH Hotel Group recorded revenues of €233.7 million in the first quarter of the year, almost four times higher than the first quarter of 2021 but still 33.7% below pre-Covid levels. The group expects to close this gap in the coming months. So far this year, occupancy has reached 40% in the first quarter, rising from 53% in March to 63% in April. ADR (Average Price) is also up and this upward trend continues in May, which would imply approaching the 2019 comparable RevPAR level. In the first quarter of the year, the group reduced its recurring net loss by 38%, currently standing at -€76.9 million compared to a loss of -€124.4 million in the same period in 2021.

Meliá Hotels recorded revenues of 271.4 million euros, "only" -30.9% of those recorded in 2019. EBITDA is also consolidating, with an increase of €73.9 million compared to the first quarter of 2021. RevPAR follows the same upward trend, showing an increase of 167.5 compared to the same period in 2021. The group says that this was the last quarter in which it recorded a negative net result, being more than confident for the months to come in view of the current recovery of tourism in the world. Between October 2021 and March 2022, the group signed 45 hotels, including 15 in Vietnam, representing 4,400 keys.

The observation on the side of the cruiseline is more heterogeneous because even if the reservations take again and that the large groups launch new lines, the vacationers anticipate their departures much less. The reason for this is the health uncertainties that are still hanging overhead, to which geopolitical uncertainties are added. Two phenomena which continue to impact this sector already hard hit by the two years of the pandemic. And the rebound in bookings observed over the last few months could be considerably slowed down by the soaring costs linked to fuel, which could be passed on to the price of cruises and therefore ultimately slow down demand.

Norwegion Cruise Line has shared its results for the first quarter of this year and the figures are encouraging overall. The group's revenue stands at $521.9 million, an increase of 16,736.8% compared to the same period in 2021 when the group's operations were almost at a standstill. They are still down 62.8% compared to the first quarter of 2019. Of the revenue in the first quarter of this year 342.4 million came from cruise sales and 179.5 million from shipboard sales. In the first quarter of 2022, the group's fleet of 28 ships welcomed 191,000 passengers, compared to 645,000 in the same period in 2019.

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