Accor reports strong Q1 results following business split
The company, which split its business as a hotel operator and brand franchisor (HotelServices) and hotel owner and investor (HotelInvest) at the end of 2013, said both businesses have performed well so far this year.
HotelServices saw gross revenue leap 3.5 per cent to €2.5 billion on the back of RevPAR growth and expansion.
Like-for-like revenue rose by 4.7 per cent year-on-year, with Northern, Central and Eastern Europe (NCEE) revenues up an impressive 6.8 per cent after ‘strong gains’ in the UK and all other countries in the region, with the exception of France.
Globally, revenue growth was primarily driven by economy (8.2 per cent), although midscale and luxury businesses also recorded growth of 4.7 per cent and 5.8 per cent respectively.
Investment improvement
HotelInvest, meanwhile, reported a 1.2 per cent increase in like-for-like revenues.
NCEE accounted for 44 per cent of revenues and achieved a 4 per cent like-for-like which Accor said was driven by ‘sustained strong demand’ in the UK and Germany.
“Accor’s performance continued to improve in first-quarter 2014, despite a tough French market,” said Accor chairman and chief executive Sébastien Bazin.
“HotelServices confirmed its high potential and is expanding quickly in fast growing geographies, while HotelInvest consolidated its position as the leading hotel investor in Europe, benefiting in particular from strong dynamics in the United Kingdom and Germany.”
Growth strategy
Total Q1 2014 revenue was €1.135 billion, up 2.1 per cent like-for-like but down 5.5 per cent in reported terms as the result of ‘a decline in the Australian dollar and Brazilian real against the euro’
Accor continues to pursue an aggressive expansion strategy and has opened 32 new hotels with a total of 4,449 new rooms globally so far this year, adding €8 million in revenue.
Looking forward, the group said it expected revenues to continue rising as a result of the ‘solid trading environment’ in the UK and almost every other country, with the exception of France, which is suffering from an increase in VAT and poor weather conditions.
“These trends should continue in the coming months. At the same time, the Group is pursuing deployment of its new strategy at a fast pace,” said Bazin.
