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1. Whitbread Posts Record Return on Capital, But Announces 1,500 Job Cuts
Whitbread PLC, parent company of the United Kingdom’s largest hotel brand by room and hotel counts, Premier Inn, said its full-year 2023 results saw a record performance of return on capital of 15.5%, up from 12.9% the year before. Company executives also said, however, that a transformation of 112 of its owned, on-site restaurants into additional hotel rooms would be partially responsible for cuts of approximately 1,500 positions.
CEO Dominic Paul said the firm has initiated a cost-efficiency program to deliver £150 million ($187.9 million) of savings over the next three years and that its German business is due to break even in the next calendar year.
2. Nigeria’s Transcorp Hotels Returns $1.5 Million to Shareholders
Nigeria’s Transcorp Hotel Group, part of conglomerate Transnational Corp. PLC, announced at its annual general meeting on April 29 that it is returning 2 billion Nigerian naira ($1.5 million) to shareholders following the recent release of its full-year 2023 earnings results. Company executives said this underlines the hotel brand’s continued growth and appeal to an emerging domestic market focused on high-end and luxury hotel stays.
The company also noted plans to further invest in its Transcorp Hilton Abuja.
"We are continuing this investment, with our 5,000-capacity event centre purpose-built to host local and international entertainment, conference, and exhibition events," said Dupe Olusola, managing director and CEO of Transcorp Hotels. This new world-class facility located within the premises of Transcorp Hilton Abuja is scheduled to open in the second half of 2024.
3. Chinese Hotels Push Back on Facial-Recognition Biometrics
The hotel industry in China, in response to customer concern over privacy, has in part discontinued the use of biometric facial scanning of guests, according to website Biometric Update. The website reports hotel firms such as “Hilton, Marriott and H World are some of the hotel chains in Shanghai that have already discontinued the practice of scanning their guests’ face biometrics during check-in.”
Consumer complaints have been targeted at multiple industries, which prompted further legislation on the matter beyond the country’s Personal Information Protection Law act.
The news outlet reports that in March, China Tourism Academy President Dai Bin said that the hotel sector's use of this technology went beyond legal boundaries for purposeful use.
4. European GDP Creeps Up
Economic growth in Southern Europe, notably Portugal, Italy and Spain, helped drive gross domestic product in the first quarter of 2024 to increase in both the Eurozone and European Union by 0.3% from the previous quarter, according to Eurostat, the statistical office of the European Union.
It's a notable turnaround by the group of countries branded the PIGS nations — economies in dire straits during the Great Recession. The latest numbers show both Spain and Portugal posting first quarter 2024 GDP increases of 0.7%, while Germany, long the powerhouse of Europe, coming in at an increase of only 0.2%.
5. Ashford Provides More Details on Deleveraging Plan
Dallas-based hotel real estate investment trust Ashford Hospitality Trust shared more details in its deleveraging strategy. The REIT said it has transferred possession and control of 14 hotels — the assets equally split into two pools — to a court-appointed receiver. Keys A Loan Pool is valued at $180.7 million, while Keys B Loan Pool is valued at $174.4 million.
"The Company has been fully cooperating with the servicer for a consensual foreclosure or deed in lieu of foreclosure on these properties since July 2023," the news release states. "As a result of the transfer, the company has no further economic interest in the operations of these hotels."
Ashford Trust also closed on the sale of the 85-key Hampton Inn in Lawrenceville, Georgia, for $8.1 million.