Hospitality-focused advisory firm Quantaco has released the first of its 2023 quarterly reports which highlights opportunities and challenges for the industry, and which will form part of a larger annual report later in the year.
This first report covers the January to March 2023 quarter and compares a number of key metrics including sales, earnings, food, beverage and gaming turnover to the same period in 2022.
Looking at the quarter, Quantaco said: “Thanks to limited COVID-related impacts, increased consumer confidence, and renewed tourism, the Australian hospitality sector has demonstrated remarkable resilience and a promising path forward. As a result, hospitality has experienced a 13 per cent increase in weekly sales in the quarter compared to the prior year.
“This marks a significant milestone in the journey towards recovery for the Australian hospitality industry.”
Quantaco did highlight the importance of context in this first quarter comparison of 2023 versus 2022, noting that “while January to March 2022 was free from most COVID-19-related restrictions, the virus was still having a significant impact, with daily case numbers in the tens of thousands”.
The report added: “High sickness was impacting the hospitality industry in various ways, from staff availability to supply chain issues to low consumer confidence. With that context, it’s fair to say that the numbers for 2023 can be considered inflated, however they provide an interesting insight into the industry’s performance so far this calendar year.”
Food sales in the first quarter of 2023 are up by 34 per cent on 2022, outperforming beverage sales which experienced 18 per cent growth which is promising, nonetheless.
Unfortunately the Quantaco data found that this growth has not transferred to the bottom line with overall profitability remaining flat with no growth as measured by EBITDAR. The increase in operating costs seen over the last few months may have negated the benefits of revenue growth the advisory firm suggested.
Quantaco also pointed to the increase in promotions this year compared to last, which will contribute to a reduction in profit, with marketing and entertainment significantly higher, representative of the return to full trading and the need to attract and entertain patrons.
One possibly surprised statistic is that gaming turnover decreased by four per cent in the first quarter of 2023 compared with last year, which Quantaco said could be attributed to the surge in gaming seen early last year following weeks of lockdowns and the subsequent pent-up demand.
Looking overall Quantaco said: “The Australian hospitality industry’s performance in the first three months of 2023 has been positive, particularly when compared against the backdrop of inflation and economic uncertainty.
“However, the comparative period has positively influenced some of the metrics, which means operators should continue to focus on maximising operational efficiency and taking a data-driven approach to business decisions.”
The full industry report is available through the Quantaco website.
