Accor: 2008 Revenue Up 2.8% - Like-for-Like
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Accor: 2008 Revenue Up 2.8% - Like-for-Like
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Catégorie : Monde - Économie du secteur -
Chiffres et études
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· Strong growth in Prepaid Services: up 12.9%
of which 13.6% in the fourth quarter
· Resilience in Economy Hotels (excluding Motel 6): up 3.2%
of which a negative 0.5% in the fourth quarter
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2008 profit before tax target confirmed at
€870-890 million, up 12% like-for-like, excluding the impact of the
return to shareholders
2008 revenue performance was shaped by the following factors:
· 2.8% like-for-like growth.
· The strategic refocusing on the Hotels and Prepaid Services businesses (with the disposals of
Red Roof Inn, Go Voyages and the Italian and Brazilian foodservices operations) and the
continued deployment of the asset-right strategy, which together reduced revenue for the year
by €865 million or 10.6%.
· The expansion strategy, which increased revenue by €422 million or 5.2%, including the
consolidation of Orbis in the third quarter.
· The negative 2.1% currency effect resulting from the weakness of the dollar, the British pound
and most South American currencies against the euro.
Revenue for the fourth quarter alone came to €1,952 million, down a reported 2.5% over the year-earlier
period. Like-for-like, revenue was down 1.1% for the quarter, as softening demand in the Hotels business,
particularly in the upscale and midscale segments, offset sustained growth in Prepaid Services.
Prepaid Services
Revenue up 12.9% like-for-like for the year
Revenue from the Prepaid Services business amounted to €978 million in 2008, an increase of 10.5% as
reported and of 12.9% like-for-like. Revenue growth tracked the increase in issue volume, which rose
11.0% to €12,696 million from €11,436 million in 2007.
Acquisitions added 3.7% to growth for the year. However, the currency effect was a negative 2.8%, mainly
due to the weakness of the British pound and Latin American currencies.
Prepaid Services revenue for the fourth quarter alone stood at €285 million, up 9.3% as reported and
13.6% like-for-like.
In Europe, revenue rose by 7.7% like-for-like in the fourth quarter.
Revenue in France was up 9.6% like-for-like and 16.8% excluding an adjustment, with increases of
12.2% in meal vouchers and 14.2%* in gift vouchers.
Revenue rose 6.9% like-for-like in the United Kingdom, led by a 16.0% increase in childcare and
luncheon voucher products. On the other hand, gift voucher revenue was down 9.2% like-for-like for
the period.
Adjusted for the loss of the Onem contract in October 2007, revenue in Belgium was up 5.4%.
In Latin America, revenue climbed 22.2% like-for-like over the quarter. In Brazil, like-for-like revenue
remained on the strong upward trend that began early in the year, rising 27.7% during the quarter, while the
other Latin American countries enjoyed an aggregate 15.9% increase like-for-like. This performance takes
into account the 50.5% fall in revenue in Argentina during the quarter following the withdrawal of local payroll
tax breaks. Excluding Argentina, revenue growth in Latin America came to 29.7% for the period.
Hotels
Revenue up 2.1% like-for-like for the year
Hotels revenue for the year amounted to €5,767 million, up 2.1% like-for-like and down 1.0% as
reported, reflecting the following factors:
· The 5.1% like-for-like increase in the first six months of the year, when the economy was still
favorable, was followed in the third quarter by the first signs of a slowdown, with growth easing
to just 1.1% like-for-like on a decline in demand, notably in the United States and Southern
Europe. Business conditions further deteriorated in the final quarter, when Hotels revenue
contracted by 2.8%.
· The sale of Red Roof Inn and other hotel units as part of the asset-right strategy had a negative
impact of €316 million or 5.4% on revenue for the year.
· The expansion strategy added €267 million or 4.6% to annual revenue, of which €108 million
from the consolidation of Orbis (€93 million in the Upscale and Midscale Hotels segment and €15
million in the Economy Hotels in Europe segment). In all, 28,000 rooms were opened over the
period.
· The currency effect was a negative 2.3%, stemming mainly from the increased strength of the
euro against the dollar and the British pound.
Revenue for the fourth quarter alone came to €1,438 million, unchanged from the year-earlier period as
reported and down 2.8% like-for-like, due primarily to the Upscale and Midscale Hotels segment and the
Economy Hotels US business.
Upscale and Midscale Hotels
2008 revenue up 2.6% like-for-like
Revenue from upscale and midscale hotels amounted to €3,448 million in 2008, an increase of 2.6% likefor-
like (2.9% excluding the impact of the Rugby World Cup) and of 3.7% as reported.
Fourth-quarter revenue down 3.3% like-for-like
In a challenging economy, Upscale and Midscale Hotels revenue declined by 3.3% like-for-like in the fourth
quarter, compared with a 6.2% increase in the first-half and a 1.8% gain in the third quarter.
The revenue impact varied by region:
· A first set of countries (including the United Kingdom, Spain, Italy and Portugal), which
contribute 31% of segment revenue, are experiencing a deep recession, with a more than 8%
decline in like-for-like revenue.
· Operations in Germany and France, which account for 54% of segment revenue, are being less
impacted by recession, with like-of-like revenue declines of 2 to 4% for the period.
· Lastly, a third set of countries (in Africa, Asia and Latin America), which reported an
aggregate €132 million or 15% of quarterly segment revenue, are withstanding the economic
situation and maintaining their growth momentum.
In France, like-for-like fourth-quarter revenue was down 3.6%, or 2.0% excluding the impact of the Rugby
World Cup. The midscale segment is proving more resilient (down 2.7%) than the upper upscale and upscale
(down 8.2%).
Revenue was down 2.6% like-for-like in Germany, with again, firmer resistance in the midscale (down 2.1%)
than in the upper upscale and upscale (down 4.4%).
In the United Kingdom, revenue fell 8.8% like-for-like, with stronger resistance in London (Novotel RevPAR
down 2.8%) than in the regions (Novotel RevPAR down 10.1%).
Economy Hotels (excluding Motel 6)
2008 revenue up 3.2% like-for-like
Revenue from economy hotels outside the US totalled €1,719 million in 2008, an increase of 3.2% like-forlike
and of 3.4% as reported.
Fourth-quarter revenue down 0.5% like-for-like
Revenue eased back 0.5% like-for-like in the fourth quarter after expanding 6.1% in the first half and 1.7% in
the third quarter. It is worth noting that excluding operations in Spain, Portugal and Italy, Economy Hotel
revenue outside the US rose by 0.7% during the quarter.
Revenue in France was up 1.2% like-for-like, led by the Ibis brand, which reported 2.5% like-for-like growth
and a 5.0% increase in RevPAR for its Paris units.
In Germany, revenue was down just 0.6% like-for-like, while in the United Kingdom, it declined by 1.1%,
with a better performance in London (Ibis RevPAR down 1.1%) than in the regions (Ibis RevPAR down
5.2%).
Economy Hotels in the United States
2008 revenue down 2.1% like-for-like
Revenue from economy hotels in the United States stood at €600 million for the year, a decline of 28.7%
as reported (due to the disposal of Red Roof Inn) and of 2.1% like-for-like.
Fourth-quarter revenue down 6.5% like-for-like
On a like-for-like basis, revenue contracted by 6.5% in the fourth quarter, after dipping 0.4% in the first half
and declining 2.7% in the third quarter. Motel 6 outperformed the competition during the period.
Franchise fees were up 23.4%.
Other businesses
Like-for-like revenue from the other businesses (Casinos, Lenôtre, Onboard Train Services and Others)
came to €995 million in 2008, down 0.6% with a 5.9% decline in the final quarter.
Reported revenue for the fourth quarter was down 24.4% to €229 million, primarily due to the disposal of
the Brazilian foodservices business (deconsolidated as of March 31, 2008), which offset the positive €18
million impact over the quarter from the consolidation of Orbis Travel and Orbis Transport since July 1, 2008.
Casinos revenue contracted 10.3% like-for-like, reflecting the decline in traffic caused in part by France’s
new anti-smoking legislation.
The Restaurant business (mainly Lenôtre) saw a 4.7% like-for-like decline in revenue.
Revenue from Onboard Train Services rose 3% like-for-like, led by the increasing passenger numbers on
the TGV Est high-speed train line.
2008 earnings guidance
Accor confirms its target, announced last October, of full-year 2008 profit before tax and non-recurring items
of between €870 million and €890 million. This guidance takes into account the clear slowdown in business
in the fourth quarter and the resilience of the Prepaid Services division.
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