ACCOR (EPA:AC) - First-quarter 2019 revenue of €987 million up 34.2% as reported and 8.8% like-for-like
Directive transparence : information réglementée Information financière du premier trimestre
18/04/2019 17:51
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Press Release
PARIS, APRIL 18, 2019
First-quarter 2019 revenue of EUR987 million up 34.2% as reported and
8.8% like-for-like
SUSTAINED ORGANIC GROWTH IN THE PORTFOLIO, WITH 8,300 ROOMS OPENED
Sébastien Bazin, Chairman and Chief Executive Officer, said:
"In a turbulent macroeconomic environment, the Group's first-quarter revenue
performance highlights the effectiveness of our transformation and the
soundness of our strategy. Europe remained strong, while South America
continued its robust recovery. We achieved sustained business development over
the period, in line with our medium-term objectives, and continued to
strengthen our pipeline, with an ever-increasing share of luxury hotels, which
generate higher fees per room. Performing well and growing steadily stronger,
the Group can tackle the rest of the year with confidence."
Consolidated first-quarter 2019 revenue totaled EUR987 million, up 34.2% as
reported and 8.8% like-for-like (LFL).
The Group's RevPAR increased by 1.6%, with mixed performances depending on the
region: Europe was resilient (+3.3%), while Asia-Pacific was down slightly
(-0.6%). Accor anticipates an improvement of the momentum across the year. The
Group confirms a RevPAR growth of around 3% for FY19.
Changes in the scope of consolidation (acquisitions and disposals) had a
positive impact of EUR176 million (+23.9%), thanks in particular to the
contributions of Mantra and Mövenpick.
Currency effects had a positive impact of EUR11 million, attributable chiefly
to the depreciation the euro against the US dollar (8%).
During the first quarter, Accor opened 71 hotels, representing 8,300 rooms. At
the end of March 2019, the Group's pipeline amounted to 1,135 hotels and
200,000 rooms.
Strong growth in revenue
In the first quarter of 2019, the Group posted a robust 8.8% increase in
revenue at constant scope and exchange rates (like-for-like), driven by strong
growth in HotelServices (+7.3%) and Hotel Assets (+8.9%). Revenue from New
Businesses was up 10.0% like-for-like.
Change Change
In EUR millions Q1 2018(1) Q1 2019 (as reported) (LFL)(2)
HotelServices 569 645 +13.5% +7.3%
New Businesses 31 37 +22.0% +10.0%
Hotel Assets & Other 157 323 +106.0% +8.9%
Holding & Intercos (23) (19) N/A N/A
Total 735 987 +34.2% +8.8%
(1) Proforma figures: adjusted for the deconsolidation of AccorInvest as of
January 1, 2018.
(2) Like-for-like: at constant scope of consolidation and exchange rates.
Highly positive momentum for HotelServices
HotelServices, which operated 4,835 hotels (709,945 rooms) under franchise
agreements and management contracts at the end of March 2019, reported a 7.3%
like-for-like increase in revenue to EUR645 million. This rise demonstrates the
resilience of our business model despite moderate RevPAR growth.
The Management & Franchise (M&F) business posted revenue growth of 7.0%,
reflecting contrasting RevPAR performances in the various regions and the
Group's sustained development:
Change
In EUR millions Q1 2018(1) Q1 2019 (LFL)(2)
Europe 101 102 +7.6%
Asia-Pacific 50 56 +4.2%
Middle East & Africa 19 24 (0.6%)
North America, Central
America & the Caribbean 30 31 +13.0%
South America 10 11 +13.0%
Total 211 225 +7.0%
(1) Proforma figures: adjusted for the deconsolidation of AccorInvest as of
January 1, 2018.
(2) Like-for-like: at constant scope of consolidation and exchange rates.
Consolidated RevPAR was up 1.6% overall in the quarter.
Europe posted a strong increase in M&F revenue (+7.6% LFL), driven by RevPAR
growth of 3.3%, all segments combined.
- In France, RevPAR was up 2.7% like-for-like, despite a demanding comparison
base. Paris and regional cities posted similar like-for- like growth of 2.7%
and 2.5%, respectively. The upcoming Air Show in June will support corporate
demand over the second quarter. The Yellow Vests movement had only a marginal
impact on the Group's business.
- RevPAR growth was limited in the United Kingdom (+0.9%). The highly
contrasted situation between London and the regional cities continued. The
increase in RevPAR in London (+5.8%), driven by persistently strong inbound
tourism, offset the decline in business in regional markets (-4.0%)
attributable to a weak corporate demand amid Brexit uncertainties.
- In Germany, RevPAR grew by a solid 3.4%, driven by a favorable trade fair
calendar.
- In Eastern Europe, RevPAR growth remained strong at +5.4% driven by a dynamic
pricing policy especially in Poland and strong leisure demand in Budapest.
- The Iberian Peninsula continued its strong recovery, with RevPAR up 8.8%,
following political tensions in Catalonia in 2017 and thanks to the ramp-up
of Pullman and Fairmont in Barcelona after renovation works.
The slight contraction in business in Asia-Pacific (RevPAR down 0.6%) is driven
by Australia, where oversupply in major cities and the upcoming general
elections affected prices and occupancy rates, resulting in a 1.6% decrease in
RevPAR.
Besides, the first quarter showed some weakness in Chinese outbound travel to
countries such as Thailand, Vietnam, Malaysia and Australia. RevPAR in China
was down 3.0% over the quarter.
RevPAR was also down a slight 0.7% in the Middle East & Africa region.
Oversupply continued to impact prices, which declined by 2.9% during the
period.
North America, Central America & the Caribbean posted a 2.1% decrease in
RevPAR, impacted by a special event in the US in 2018 and major renovations in
Canada in 2019.
Lastly, business continued to recover steadily in South America, and
particularly in Brazil, where Rio de Janeiro grew strongly, in line with the
rest of the country. As a result, RevPAR rose by 11.2%, mainly driven by
prices.
The Group's development continues at a rapid pace. During the first quarter,
Accor opened 71 hotels, representing nearly 8,300 rooms. At the end of March
2019, the Group's pipeline comprised 1,135 hotels and 200,000 rooms, of which
78% in emerging markets and 50% in the Asia-Pacific region.
Sustained growth in New Businesses
New Businesses (concierge services, luxury home rentals, private sales of
luxury hotel stays, and digital services for hotels) generated revenue of EUR37
million, up 10.0% like-for-like from EUR31 million in 2018. The 22.0% increase
as reported reflects the acquisitions of ResDiary and Adoria.
Strong growth in Hotel Assets revenue
Revenue derived from the "Hotel Assets & Other" segment grew by 8.9% like-for-
like, reflecting a solid RevPAR growth in Eastern Europe and the strong
recovery observed in Brazil. On a reported basis, the 106.0% increase in
revenue is attributable to the acquisitions of Mantra and Mövenpick.
At the end of March 2019, this division, which includes owned and leased
hotels, represented 245 hotels and 46,038 rooms.
2019 perspectives
The trends observed over the first quarter confirm the robustness of the Group.
In 2019, Accor expects notably a record organic system growth and a progressive
improvement in RevPAR, which should reach around 3% for the full-year.
Meanwhile, the group pursues its transformation.
Share buyback program
A second EUR500 million tranche of the share buyback program was completed
between December 20, 2018 and March 26, 2019, covering 13.4 million shares.
Since the program's launch in July 2018, the Group has bought back 21.8 million
shares, or 7.5% of its capital, for a total of EUR850 million, or an average
price of EUR39.0 per share.
The Board of Directors will soon decide the next steps to complete the
execution of the program.
Events from January 1, 2019 to April 18, 2019
Financing
In January 2019, Accor successfully completed two liability management
operations:
. On January 24, Accor placed two bonds, for EUR1.1 billion:
- a EUR500 million perpetual hybrid bond with a 4.375% coupon;
- a EUR600 million 7-year senior bond with a 1.75% coupon.
Both transactions were oversubscribed by about six times, reflecting strong
investor confidence in the Group's new business model, growth potential and
attractive risk profile.
. On January 31, Accor successfully closed two tender offers and partially
redeemed two bonds, including a perpetual hybrid bond (4.125% coupon) and a
senior bond maturing in 2021 (2.625% coupon), for a total amount of EUR736
million:
- EUR386 million on the perpetual hybrid bonds (EUR900 million bond issue in
June 2014);
- EUR350 million on the 2021 bonds.
On February 25, Accor established a EUR500 million Negotiable European
Commercial Paper (NEU CP) program. With this program, Accor diversified its
source of funding while optimizing its cost of debt.
Orbis
On January 23, Accor confirmed the acquisition of 33.15% of Orbis for around
EUR339 million. Accor now owns, directly and indirectly, 85.84% of Orbis' share
capital. As a result, Accor has strengthened its control of Orbis and
consolidated its leadership in the region. Accor has signed a cooperation
agreement under which the Group and Orbis are working on structuring options.
Hotel activities
On February 21, Accor announces the launch of a new customer promise embodied
by the "ALL-Accor Live Limitless" program that will combine our distribution
platform and a new experiential loyalty program. In this context, the Group
announces a signing of several global partnerships notably with AEG, IMG and
the Paris Saint- Germain football club, as ALL will notably become the main
partner and shirt sponsor as of the next season
On March 4, Accor continued to expand its brand portfolio with its new midscale
lifestyle brand, Tribe.
On March 5, sbe launched a new global lifestyle brand, The House of
Originals.
On April 4, Accor announced the opening of two majestic hotels in India,
Raffles Jaipur and Raffles Udaipur. The move signals a new direction for Accor
in India, with a stronger focus on luxury and premium brands.
Upcoming events in 2019
April 30, 2019: Annual Shareholders' Meeting
July 31, 2019: First-half 2019 results (after market close)
ABOUT ACCOR
Accor is a world-leading augmented hospitality group offering unique and
meaningful experiences in 4,800 hotels, resorts, and residences across more
than 100 countries. With an unrivalled portfolio of brands from luxury to
economy, Accor has been providing hospitality savoir-faire for more than 50
years.
Beyond accommodations, Accor enables new ways to live, work, and play with Food
& Beverage, nightlife, wellbeing, and co-working brands. To drive business
performance, Accor's portfolio of business accelerators amplifies hospitality
distribution, operations, and experiences. Guests have access to one of the
world's most attractive hotel loyalty programs.
Accor is deeply committed to sustainable value creation, and plays an active
role in giving back to planet and community. Planet 21 - Acting Here endeavors
to act for "positive hospitality", while Accor Solidarity, the endowment fund,
empowers disadvantaged people through professional training and access to
employment.
Accor SA is publicly listed on the Euronext Paris Stock Exchange (ISIN code:
FR0000120404) and on the OTC Market (Ticker: ACRFY) in the United States.
For more information visit accor.com. Or become a fan and follow us on Twitter
and Facebook.
Media Relations
Carina Alfonso Martin Line Crieloue
Vice President Media Relations Worldwide Relations Media Corporate
Phone: +33 (0)1 45 38 84 84 Tel: +33 (1) 45 38 18 11
Email: carina.alfonsomartin@accor.com Email: line.crieloue@accor.com
Investor and Analyst Relations
Sébastien Valentin Pierre-Loup Etienne
Chief Communications Officer Investor Relations
Phone: +33 (0)1 45 38 86 25 Phone: +33 (0)1 45 38 47 76
Email: sebastien.valentin@accor.com Email:pierre-loup.etienne@accor.com
RevPAR excluding tax by segment and market - Q1 2019
Occupancy rate Average room rate RevPAR
chg pts
Q1 2019 % LFL EUR chg % LFL EUR chg % LFL
Luxury & Upscale 63.8 +2.0 150 +2.9 96 +6.3
Midscale 62.6 +0.1 91 +2.5 57 +2.7
Economy 63.6 +0.3 62 +2.3 39 +2.8
Europe 63.2 +0.4 80 +2.6 51 +3.3
Luxury & Upscale 65.3 +0.4 119 -0.8 78 -0.2
Midscale 68.8 -0.5 84 +0.1 58 -0.6
Economy 70.5 -0.3 46 +0.0 32 -0.4
Asia-Pacific 67.9 -0.1 85 -0.4 58 -0.6
Luxury & Upscale 67.4 +3.6 138 -4.2 93 +1.1
Midscale 70.4 +1.1 74 -5.3 52 -3.8
Economy 67.1 -2.9 61 -2.6 41 -6.7
Middle East & Africa 67.4 +1.5 111 -2.9 75 -0.7
Luxury & Upscale 66.7 -0.8 230 -1.0 153 -2.2
Midscale 73.5 +1.8 128 +1.0 94 +3.5
Economy 59.7 -4.7 41 +1.8 24 -5.3
North America,
Central America &
the Caribbean 66.9 -1.0 202 -0.7 135 -2.1
Luxury & Upscale 58.3 +1.8 123 +9.4 72 +13.4
Midscale 57.8 +2.5 67 +7.1 39 +11.7
Economy 54.1 +1.9 43 +7.0 23 +10.7
South America 55.5 +2.0 59 +7.3 33 +11.2
Luxury & Upscale 65.5 +1.1 147 -0.6 96 +1.0
Midscale 64.9 +0.2 87 +1.6 56 +1.9
Economy 63.8 +0.2 56 +2.1 36 +2.5
Total 64.5 +0.4 89 +0.9 58 +1.6
Hotel base - Q1 2019
Hotel assets Managed Franchised Total
Q1 2019 Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms
Luxury & Upscale 22 6,021 102 18,988 60 11,226 184 36,235
Midscale 58 10,940 324 51,648 562 60,143 944 122,731
Economy 55 8,498 592 75,703 1,188 92,505 1,835 176,706
Europe 135 25,459 1,018 146,339 1,810 163,874 2,963 335,672
Luxury & Upscale 11 2,312 247 60,459 59 9,368 317 72,139
Midscale 26 4,173 273 63,455 104 15,724 403 83,352
Economy 2 350 193 35,217 191 23,995 386 59,562
Asia-Pacific 39 6,835 713 159,131 354 49,087 1,106 215,053
Luxury & Upscale 2 525 144 36,706 6 956 152 38,187
Midscale 2 235 51 10,411 9 2,015 62 12,661
Economy 5 826 49 8,951 3 530 57 10,307
Middle East &
Africa 9 1,586 244 56,068 18 3,501 271 61,155
Luxury & Upscale 0 0 71 26,997 10 4,718 81 31,715
Midscale 0 0 6 2,641 8 1,725 14 4,366
Economy 0 0 19 2,504 2 233 21 2,737
North America,
Central America
& the Caribbean 0 0 96 32,142 20 6,676 116 38,818
Luxury & Upscale 0 0 26 5,948 5 1,094 31 7,042
Midscale 13 2,205 80 11,339 13 1,651 106 15,195
Economy 49 9,953 81 13,538 112 13,519 242 37,010
South America 62 12,158 187 30,825 130 16,264 379 59,247
Luxury & Upscale 35 8,858 590 149,098 140 27,362 765 185,318
Midscale 99 17,553 734 139,494 696 81,258 1,529 238,305
Economy 111 19,627 934 135,913 1,496 130,782 2,541 286,322
Total 245 46,038 2,258 424,505 2,332 239,402 4,835 709,945