04/25/2024 | Press release | Distributed by Public on 04/25/2024 09:45
Sébastien Bazin, Chairman and CEO of Accor, said:
"In this first quarter, marked by the Group's return in CAC 40, Accor once again delivered a solid performance, increasing revenue in all regions, notably in the Middle East and Asia-Pacific. Our network growth also accelerated, reflecting the attractiveness of our brands and the trust of our owners. By continuing to combine high standards with operational flexibility, quality of execution and financial discipline, we are confident in our ability to pursue a growth path that is in line with the objectives we have set for ourselves."
The first quarter of 2024 once again demonstrates the strength of hotel demand in all Accor Group regions and segments. Operating performance indicators (RevPAR and portfolio growth) are all trending positively, and the Group has continued to manage its balance sheet in line with its commitments.
In the first quarter of 2024, Accor opened 53 hotels corresponding to over more than 8,000 rooms, representing a net unit growth of 3.1% over the last12 months. At the end of March 2024, the Group had a hotel network of 825,313 rooms (5,613 hotels) and a pipeline of 224,000 rooms (1,297 hotels).
First-quarter 2024 RevPAR
The Premium, Midscale & Economy (PM&E) division posted an 8% increase in RevPAR compared with the first quarter of 2023, still more driven by rates than by occupancy rates.
The Luxury & Lifestyle (L&L) division reported a 7% increase in RevPAR compared with the first quarter of 2023, mainly driven by higher occupancy.
Group revenue
For the first quarter of 2024, the Group reported revenue of
€1,236 million, up 8% on a like-for-like basis (LFL) compared with the first quarter 2023. This increase breaks down into a 6% growth for the Premium, Midscale and Economy division and a 12% growth for the Luxury & Lifestyle division.
Scope effects, mainly linked to the acquisition of Potel & Chabot (in October 2023) in the Luxury & Lifestyle division (Hotel Assets and Other segment), positively contributed for €38 million.
Currency effects had a negative impact of €37 million, mainly due to the Australian dollar (-5%) and the Turkish lira (-40%).
Premium, Midscale & Economy revenue
Premium, Midscale & Economy, which includes fees from Management & Franchise (M&F), Services to Owner and Hotel Assets & Other of the Group's Premium, Midscale & Economy brands, generated revenue of €690 million, up 6% LFL compared with the first quarter of 2023. This increase reflects the sustained activity reported over the period, mitigated by a base effect in Services to Owner.
The Management & Franchise (M&F) revenue totaled €192 million, up 14% LFL compared with the first quarter of 2023. This increase, which was higher than the 8% rise in RevPAR over the period, reflects the strong growth in incentive fees provided for in management contracts, particularly in Asia-Pacific region. Management & Franchise performance by region is detailed on the following page.
Services to Owners revenue, which includes Sales, Marketing, Distribution and Loyalty activities, as well as shared services and the reimbursement of hotel costs, totaled €252 million, down (1)% LFL compared with the first quarter of 2023. This decline reflects a base effect on the same period last year, which included the final rebilling of costs incurred by Accor as part of its reception services for supporters during the soccer World Cup in Qatar.
Hotel Assets and Other revenue was up 9% LFL compared with the first quarter of 2023. This segment, which is strongly linked to activity in Australia and Brazil, reflects the level of activity recorded in these regions.
Luxury & Lifestyle revenue
Luxury & Lifestyle, which includes fees from Management & Franchise (M&F), Services to Owner and Hotel Assets & Other of the Group's Luxury & Lifestyle brands, generated revenue of €566 million, up 12% LFL compared with the first quarter of 2023. This increase also reflects the good activity performance over the period, as well as the opening of new venues at Paris Society.
Management & Franchise (M&F) revenuetotaled €102 million, up 11% like-for-like compared with the first quarter of 2023, driven by a 7% increase in RevPAR and strong growth in incentive fees from management contracts. The performance of the Management & Franchise business by segment is detailed on the following page.
Services to Owners, which includes Sales, Marketing, Distribution and Loyalty activities, as well as shared services and the reimbursement of hotel costs, totaled €347 million, up 12% LFL compared with the first quarter of 2023.
Hotel Assets and Other revenue wasup 13% LFL compared with the first quarter of 2023. This change on a like-for-like basis reflects the opening of the Abbaye des Vaux de Cernay hotel and new restaurant venues at Paris Society, while the reported change of +77% includes a significant scope effect linked to the acquisition of Potel & Chabot in October 2023.
Management & Franchise revenue
Management & Franchise (M&F) posted revenueof €294 million, up 13% LFL compared with the first quarter 2023. This change reflects RevPAR growth of 8% LFL vs. the first quarter of 2023 amplified by:
Outlook
The Group confirmed its medium-term growth perspectives as disclosed during the Investor Day on June 27, 2023:
In the first quarter of 2024, Accor completed a €400 million share buyback program, with an accretive effect for shareholders through the cancellation of 3.9% of its shares.
Events in 2024
Disposal of Accor Vacation Club
On January 30, 2024, Accor entered into an agreement with Travel + Leisure to sell Accor Vacation Club, its timeshare business in Australia, New Zealand and Indonesia on the basis of an enterprise value of AUD78 million (€48 million). The agreement also includes an exclusive franchise agreement for Travel + Leisure's future new timeshares under the Accor brands in Asia Pacific, the Middle East, Africa and Turkey. This transaction is part of the Group's ongoing asset-light strategy and was closed at the end of Q1 2024.
Bond issue
On March 4, 2024, Accor successfully placed a €600 million 7-year bond with a coupon of 3.875%. The transaction was more than 4 times oversubscribed, reflecting Accor's strong credit quality and investor confidence in its business model, growth potential and financial structure. This transaction enables the Group to take advantage of attractive market conditions and significantly extend the average maturity of its debt.
Share buyback
On April 5, 2024, Accor announced the completion of its €400 million share buyback program announced on February 22, 2024.
A first tranche of share buybacks totalling €275 million was completed through a share purchase agreement signed with Jinjiang International on March 11, 2024. The transaction accounted for 7 million shares at a price per Accor share of €39.22.
The remaining €125 million of the share buyback program, launched on March 20, 2024,
was completed on April 4, 2024, with the acquisition of 2,923,228 shares at a average price of €42.93.
At completion, the Group acquired 9,923,228 shares at an average price of €40.31. These shares have been cancelled.
Next event in 2024
May 31: Annual Shareholders' Meeting