AccorHotels had a strong first quarter 2016 with revenue totalling €1,161 million, a 1.9% like-for-like increase year-on-year (-5.2% as reported).
The company attributed the positive results to strong demand in the majority of the group’s key markets particularly in the Mediterranean, Middle East, Africa region and, to a lesser extent, in central, northern and eastern Europe where demand stabilised in the United Kingdom and Germany, as expected.
“The environment remained challenging in France where overall revenue dropped 1.6%, despite the occupancy rate holding up well (-0.5 pts). In line with trends observed since the terrorist attacks of November 2015 demand remained mixed, with Paris still experiencing difficulties and other regions seeing improvements in RevPAR, especially in February and March,” said the company in a statement.
Sébastien Bazin: Good start in a majority of our regions for 2016.
Revenue in the Americas climbed 2.8% like-for-like, despite the decline in Brazil (-3.7%). North America and the Caribbean continued to perform well (+10.2%) as did the rest of Latin America (+1.6%), in an environment shaped by high inflation.
“Overall, we got off to a good start in a majority of our regions in 2016. Only France and Brazil remain complicated, but the operational teams have been working for the past few months to implement the measures necessary to overcome these difficulties and are steadfastly focused on achieving growth and profits,” said Sébastien Bazin, chairman and chief executive officer of AccorHotels.
The group is also carrying out more value-creating initiatives and is moving ahead with its transformation project, he added.
“The recent acquisition of onefinestay, the accelerated recruitment of independent hoteliers for our AccorHotels platform and the announced acquisition of FRHI demonstrate our agility and our determination.”
Below is a summary of AccorHotels results for Q1.
Highlights
- Favorable trends in the vast majority of the group’s markets
- France continued to be impacted by the terrorist attacks in November 2015 with Paris the worst affected, while other regions showed a clear improvement
- Buoyant business in Europe, with the exception of Belgium and Germany
- HotelInvest: stable like-for-like revenue (+0.2%) despite its heavy exposure to France
- HotelServices: solid comparable revenue growth (+5.6%) particularly thanks to rapid development with the record opening of 8,961 new rooms (46 hotels) in the first quarter.
Key markets review
- Germany: first-quarter demand remained robust despite an unfavourable trade fair and exhibitions calendar and the renovation of the group’s main flagship hotel, the Sofitel Bayerpost in Munich. Against this backdrop, like-for-like revenue dipped by 1.2% for HotelInvest and by 0.6% for HotelServices. The events calendar will be more favorable for the rest of the year.
- United Kingdom: Business trends were mixed with RevPAR down 3% in London, and sustained growth in other regions (RevPAR +5%). Like-for-like revenue for HotelInvest and HotelServices climbed 3.2% and 18.5% respectively, with the latter greatly benefiting from rapid development in 2015. The increases were driven by high, stable demand with a 71.1% occupancy rate in the quarter, facilitating the optimisation of average prices (+1.3%) and RevPAR (+0.7%).
- Belgium: Suffered from the effects of the terrorist attacks in Brussels with revenue significantly weighed down towards the end of the quarter, resulting in a 5.8% decline like-for-like.
- Americas: The 2.8% like-for-like growth in revenue in the region reflects both the still difficult situation in Brazil (-3.7%), and a strong performance in the North America and Caribbean markets (+10.2%).
- MMEA: The region delivered a satisfactory performance (LFL revenue: +5.3%), led by countries in Southern Europe, and more particularly in the Iberian Peninsula (+14.4%).
Favourable outlook maintained
- Performance was sound in first-quarter 2016, and remained in line with the trends observed at the end of 2015.
- AccorHotels continued to benefit from good overall momentum, with growth in RevPAR in a number of markets, such as the United Kingdom, southern Europe, central Europe, the Middle East and the majority of markets in the Asia-Pacific region.
- Demand in France was hampered by a drop in the country’s appeal as a destination in the wake of the November terrorist attacks. Trends are encouraging in other areas of the country, and reveal a slow but sure improvement in the Paris region. A favourable calendar in May, and the start of the Euro 2016 football tournament in June should put growth back in positive territory in the second quarter.
- Germany, the group’s second biggest market, should also see a clear upward shift in the second quarter of 2016, after a stable first quarter in line with expectations.
- The development of the hotel portfolio is continuing apace with a record first quarter and a development pipeline of more than 158,000 rooms. Similar momentum has been generated by the AccorHotels marketplace, with more than 1,100 independent hotels joining the group’s booking systems since the initiative was launched in autumn 2015.
Openings
Hotel des Arts Saigon MGallery Collection
AccorHotels opened 8,961 rooms (46 hotels) to the group. They included Sofitel Sanya Leeman Resort in China, Pullman Zamzam Madina in Saudi Arabia, Novotel Phu Quoc Resort in Vietnam, Mercure Ribeirao Preto in Brazil, ibis Chennai City Centre in Indiam and ibis Styles Osaka in Japan.
Material transactions and events
- January 27: 1) Finalised a strategic alliance with Huazhu leading to a newly-formed joint distribution system and the combination of two loyalty programmes with over 75 million members worldwide. 2) Entered into exclusive negotiations for the sale of a portfolio of 85 hotels in Europe to a new franchisee hotel operator, 70% owned by Eurazeo.
- February 18: Acquired stakes in SquareBreak (30%) and Oasis Collection (49%), two digital platforms specialised in serviced property rentals.
- April 5: Acquired onefinestay, a high-end hospitality pioneer specialising in luxury serviced home rental in key worldwide gateways, for €148 million (£117 million).
- March 31: Jin Jiang International Holdings held, through three wholly owned subsidiaries, 35,250,000 Accor shares representing 14.98% of the share capital and 13.07% of the voting rights.
• Images credit: AccorHotels
