During the MHRA-BOV Quarterly Review meeting, Deloitte stated that Malta's hotel sector continued to report positive growth in the fourth quarter of 2015 and the overall results of the 2015 BOV MHRA survey by Deloitte are very encouraging, notwithstanding a relatively flat trend in overall collective accommodation bed nights.

All sectors reported significant rate improvements in 2015, leading to increased revenue, however, this was partially offset by increased expenditure in payroll, direct costs, property maintenance and marketing. The increase in expenditure is indicative of a general upgrade in Malta's accommodation product which is being reflected in increased room rates.

While tourism statistics for 2015 report an increase of 8% in arrivals and 5% in guest nights, the reported growth continues to be practically all going to non-licensed accommodation establishments. The number of tourists and guest nights reportedly opting for collective accommodation in 2015 was substantially in line with what was reported last year. This is also reflected in the survey results, where occupancy levels increased marginally notwithstanding temporary reductions in capacity due to a number of hotel refurbishment projects, leading to less bed capacity available.

Although overall volumes were relatively flat in 2015, the average rate increases were substantial in all sectors. Total average revenue per available room (REVPAR) increased by 12-15% across all sectors. Costs also increased in most sectors to reflect the quality improvement which resulted in the increased rates. The impact of increased expenditure was partially cushioned by significant savings in utility costs following a drop in utility rates early in the year.

Revenue growth was significantly more substantial than the reported cost increases and all sectors continued to strengthen their overall reported Gross Operating Profit. Looking ahead, although on average hoteliers are generally expecting occupancy levels to remain fairly stable, they remain fairly upbeat regarding rate improvement prospects.

Tony Zahra, MHRA president addressing the meeting made reference to the overall good results for 2015. He stated that accessibility remains the key to this success and emphasised that the seat capacity for 2016 is presently forecast to increase by just under 3% which would indicate that 2016 could see another record year of arrivals.   

Mr Zahra said that these results had come through the close co-operation of all the stakeholders and thanked Minister Zammit Lewis, MTA, Air Malta, MIA and all of the  stakeholders for a job well done and augured that this combined effort continues into the future.

Mr Zahra also made reference to the urgent need that government embarks on an aggressive campaign to address unlicensed operators, since these do not only create an unfair level playing field in the market place from a competitiveness perspective but also threatens the quality product and service standards of our tourism sector. Indeed Mr Zahra reminded all that it has been very challenging over the past years to gear our sector to the level we all enjoy today and asserted that "we have to continue to strive to the top". 

With reference to the 50 cents a night environment contribution,  Mr Zahra stated that MHRA has held innumerable meetings with government on this matter, the last of which was only last Monday and now believes that "we are near to reaching an agreement on the method of collection and the make up of the foundation which will administer the funds". Mr Zahra confirmed that the environment contribution will start to be collected later than 1 April, possibly as from 1 June.  

Mr Zahra also commented on the current political situation and stated that our politicians need to focus more their efforts on how to take our economy and our international standing to the next level. Good governance is essential in a democratic society and as "MHRA has supported the introduction of measures during this legislature like the Whistle Blower Act, we will also be supporting measures recommended in the PN's document Restoring Trust in Politics such as the need to have public hearing sessions for persons nominated to certain positions which call for the highest level of integrity". 

Mr Zahra said that there should not be any difficulty with people who have been nominated to accept to place themselves for scrutiny from a committee drawn from civil society and political parties prior to being formally approved.

Mr Zahra, however, also asserted that we should not forget that Malta is doing outstandingly well especially when one considers the distressed economic situation most of our source markets are experiencing and the political turmoil in North Africa, not least Libya.  Accordingly, Mr Zahra also reminded all, that MHRA has consistently stressed that government must be the support for the engine of the economy and not the economy itself.  He stated that "successful economies depend on policies strong in foresight but this is not enough. Policies need proper structures and institutions across the public sector and service to reap the expected outcome - that is why we believe that government matter".

Mr Zahra asserted that: "We have an excellent economic and internal security situation; we are the envy of a lot of countries. Let us keep it that way by seeking to find solutions to internal problems for if we lose our way it will be hard and expensive to get back to where we are now."