and Country for 9 Months Ending September 2005
Paris, October 26, 2005-
Accor’s consolidated revenues rose by 7.2% to Euros 5,629 million in the nine months that ended September 30, 2005. At constant scope of consolidation and exchange rates, the increase was 4.9%.
Expansion accounted for 4.4% of revenue growth for the period, led by the Economy Hotel segment (whose contribution to revenues was +5.2%) and Upscale and Midscale Hotels (+2.7%).
Asset disposals had a negative 2.4% impact on growth. As part of the strategy of selling non-performing Hotel assets, 31 hotels were sold, reducing segment revenues by Euros 71 million for the period.
The appreciation of mainly Brazilian real against the euro resulted in a positive 0.3% currency effect for the period.
In the third quarter alone, revenues totaled Euros 1,986 million up 7.9% on a reported basis. Revenues in the third quarter rose by 4.6% like-for-like in line with the first half’s 5.0% rise. Like-for-like third-quarter revenues were up 3.9% for Hotels, compared with 3.4% in the first half, and 13.9% for Services, versus a 12.6% rise in the first six months.
Upscale and Midscale Hotels
Upscale and Midscale Hotel revenues rose a like-for-like 3.5% in the third quarter, slightly faster than the first half’s 2.5% increase.
The 2.9% increase in segment revenues for the first nine months was led by sharp growth in the United States, Asia and South America.
In the United Kingdom, revenues were up 4.7% for the 9 month period, despite the impact of terrorist attacks on third-quarter tourist traffic in London.
In France, the strategic marketing focus on business travelers drove an average 4.0% increase in room rates for the nine-month period.
Growth remained moderate in Germany and the Benelux countries.
Economy Hotels (outside the United States)
The Economy Hotel segment continued to make solid gains, with like-for-like revenues rising 4.0% in the third quarter alone and 4.2% for the nine-month period.
In France, the rate increase strategy led to a 4.0% rise in like-for-like revenues for the first nine months. Elsewhere in Europe, revenues increased by 3.2% like-for-like. As in the Upscale and Midscale segment, the United Kingdom experienced a temporary decline in tourist traffic to London during the summer.
Economy Hotels in the US
Like-for-like revenues in the US Economy Hotel segment rose by 4.6% in the third quarter alone and 4.7% over the first nine months.
Implementation of the Red Roof Inn renovation program continued, with 86 hotels renovated as of September 30 and 19 currently in renovation.
Hurricane Katrina had no impact on revenues for the period.
Revenues from the Services business rose by 13.9% like-for-like and 22.8% on a reported basis in the third quarter. For the full nine months, they were up a strong 13.0% like-for-like and 17.1% as reported, led particularly by favorable changes in legislation in Belgium (up 20.8% like-for-like), the United Kingdom (up 19.5%) and Venezuela (up 56.4%).
Thanks to the appreciation of the Brazilian real against the euro, the currency effect had a positive 2.8% impact on nine-month revenue growth.
Travel agency revenues increased 2.9% like-for-like in the third quarter alone, lower than the first half’s 8.7% rise. The decline reflected a stabilization in the positive impact of synergies from recent acquisitions, as well as comparison base less favorable than in first half 2005.
For the full nine-month period, travel agency revenues were up 6.5% like-for-like.
Nine-month revenues for the Casinos business rose 2.0% like-for-like, but were up a reported 47.1% due to the creation of Groupe Lucien Barrière in December 2004.
The 5.3% increase in like-for-like revenues during the third quarter resulted mainly from non-recurring sales on traditional games. Excluding these items, revenue growth is trending upwards at 1 to 2%.
Like-for-like revenues from the restaurant business were up 6.6% for the first nine months of the year.
Revenues generated by onboard train services increased 8.1% like-for-like.
Business in the third quarter confirmed first-half trends.
The rise in nine-month revenues was sustained in Economy Hotels outside the US (up 4.2%), US Economy Hotels (up 4.7%), Upscale and Midscale Hotels in the United States, Latin America, Asia and the United Kingdom (up 6.7%), Services (up 13.0%) and other businesses (up 6.4%). Together, these segments account for 75% of the Accor business portfolio.
The increase in revenues in the Upscale and Midscale Hotel segment was more moderate in Continental Europe, where the marketing strategy in France is producing results.
With third quarter revenues in line with forecast, Accor is maintaining its full-year target of Euros 590-610 million in profit before tax (an increase of 15 to 20%) and around Euros 300 million in net income (up 30%) as released at first-half results.
|Also See:||The 10 largest Hotel Groups and the 10 Largest Hotel Brands in the European Union; The MKG 2005 Ranking Shows the Incontestable Predominance of Accor / February 2005|
|Accor: 2004 Hotel Revenues Up 4.1% Like-for-Like, Strong Hotel Performances in the United States and United Kingdom / January 2005|