2012 Third Quarter Air Arrivals Increase By 2%

Good Afternoon!

We in the Ministry of Business Development and Tourism have been working extremely hard to reinvent and reinvigorate our tourism product and a few key milestones from this year should be noted:

• In April we passed legislation to create a Tourism Board with authority to promote and market Bermuda.
• In June we appointed the Youth Tourism Board.
• We rolled out our National Tourism Plan at the end of June.
• And in August we announced our new brand, Bermuda ….so much more.

All the parts have come together, the plan is in place, and the strategy is being implemented. I understand the time of the season, and there will be those who will attempt to discredit the Ministry and the work that it is doing. Let me make it very clear that I am standing Strong for Bermudians.

It is for them that I am working hard to turn tourism around, so that opportunity and jobs can be generated.

The Shadow for Tourism said and I quote “We understand from sources that August and September may be the worst on record”.

This Ministry has a plan and working hard to implement it. Will we get everything right, no. But I promise the people of Bermuda this; I will give everything I have, my time, my sweat and yes sometimes my tears.

During this road to success we will have some bumps in the road, and yes we will have some valleys to go through. My focus, however, is not on the bumps or the valleys but squarely fixed on our goals and objectives.

• We are expected to increase jobs from 3,600 to 6,157 by 2022
• We are expected to increase GDP from $300 M to $513 M by 2022
• We are expected to increase air arrivals from 236,000 to 481,715 by 2022

I am happy to be able to share the preliminary results for Air Arrivals for the Third Quarter, July to September 2012.

Total air visitor arrivals to Bermuda in the third quarter of 2012 increased during the period by 2%. The quarter ended with a total of 81,083visitors to the island, up from 79,917 visitors in the third quarter of 2011. July achieved 32,714 arrivals and was down 2%; August proved to be a stellar month and achieved 30,995 arrivals and up 9%; September was 17,374 arrivals and slipped 3%.

Performance results of the ten largest hotels that make up 75% of all room inventory on the island also somewhat mirrored the positive trends for the quarter. Occupancy percentages realized were 86% in July 2012 compared to 88% in July 2011; 82% in August compared to 84% in 2011, and 56% in September compared to 54% in the previous year. It should be noted that these occupancy levels still significantly exceed the levels of the corresponding period of 2010, which negates the assertion that this is indeed the worst summer period. Recent positive statements from many hoteliers also indicate that they have been pleased with gradual, steady growth during the period.

As we look into the pacing, or forward projections of this particular group of hotels, we note that there has been some encouraging pick up of business that strongly suggests better results for the next six months. With the exception of December, which is currently pacing 20 points behind, ALL other months are trending positively. As at September 30, 2012 the month of October was already 3% ahead of the corresponding period of the previous year; November is flat; January is up 13%; February is up 21% and March is up 9%. The cumulative amount of rooms booked for the period until March 2013 are up 2%.

Expedia Inc, which is by far the largest producer of leisure visitors to the island sending over 30,000 room nights annually, is predicting its fourth positive year in a row and their bookings to the island are up by 19%. Tour operator room sales for the next six months are up 10%.

As you will recall the biggest challenge for the larger hotels has been the falloff in meeting and incentive (MICE) business, and I have mentioned many times that this, along with Sports Tourism, is clearly a major focus of the new Tourism Board. The largest contributor to the lag in air arrivals is group business, and you will recall that I reported a 62% decline in Quarter 2.

I am pleased to report that group rooms on the books for the next six months continue to grow and are now up 26% over the corresponding period a year ago. I recently met with all of the hotels who cater to group business and have committed additional funds and resources to further improve this sector. I am also expecting to receive the Sports Tourism strategic plan for 2013 on my desk by October 19.

I remain confident that we are seeing the results of tremendous effort from our entire tourism team, and some early positive results of our new So Much More brand campaign.

I continue to be convinced that we are on the right path to positive growth and it does require all partners working together to achieve this goal.

Thank You!

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