Accor has announced solid first-half results for 2014 reflecting strong momentum in international markets and the early effects of the Group’s transformation:
- Revenue up 2.8% like-for-like1 to €2,593 million
- A significant improvement in EBIT, up 17.6% like-for-like to €219 million
- Operating profit before tax and non-recurring items up 38.6% like-for-like to €192 million
- Net profit of €60 million
- Full year EBIT target of €575-595 million
Sébastien Bazin, Chairman and Chief Executive Officer, commented:
“In the first-half of 2014, our planned reorganisation ensured the Group’s transformation is now well underway. The strong results for the period, with an increase in margins, reflect good momentum and the work of highly committed teams to deploy our new strategy. Each business now has the means to respond effectively to its specific challenges. We have significantly increased resources and completed major acquisitions/restructuring for HotelInvest in the first half, followed by the agreement signed with Tritax in the United Kingdom. In the second half we will focus in particular on deploying the HotelServices strategy built around innovation, digital solutions and brands.”
First-half 2014 highlights
- The reorganisation of Accor around its HotelServices and HotelInvest business lines is now effective. The Group’s financial reporting system is now fully aligned with this new structure.
- Accor’s financial position was strengthened through debt issues at record low interest rates, including €900 million worth of perpetual subordinated notes issued in June, and a new €1.8 billion syndicated credit line.
- €900 million worth of acquisitions were completed (97 hotels in Germany, the Netherlands and Switzerland).
- The improvement of the Group’s digital eco-system for our guests was introduced by the launch of the Welcome project and the implementation of new advantages for our 16 million Le Club Accorhotels members.
- The first valuation of the gross asset value of HotelInvest’s portfolio came up to an indicative range of between €5.0 and 5.5 billion
Accor acquires 13 properties, 1194 rooms in the UK
Accor announces that HotelInvest, the Group’s hotel owner and investor business, has purchased a portfolio of 13 hotels from Tritax for a total consideration of €89 million (£71 million) in line with its stated strategy to consolidate the owned hotel base whilst strengthening its economy and midscale segments.
The portfolio, which includes 12 ibis and 1 ibis budget, represents 1,194 rooms located across the UK in key regional locations: Coventry, Coventry South, Birmingham Holloway Circus, Birmingham Bordesley, Leicester City, Plymouth, Sheffield City Shude, Liverpool, Manchester Princess Street, as well as London Stratford, London Thurrock and London Barking.
As a result of the purchase 3 Accor owned F1 hotels adjacent to the properties in Liverpool, London Barking and London Thurrock will be restructured as extensions of the newly acquired ibis budget and ibis hotels to aid rationalisation of the HotelInvest asset portfolio.
The properties have been operated under variable-rent leases by Accor since 2001, and since 2005 for Tritax, a real estate investor, on behalf of individual and private owners.
The acquisition will be financed at 100% through debt. It will be immediately accretive to Accor’s EBIT and will also reduce off balance sheet debt by c.€39m (£33m) attached to minimum lease commitments. It will also increase the contribution of owned hotels to HotelInvest’s Net Operating Income* by around 0.5 point, in line with the target of raising this figure from 54% in 2013 to more than 75% over the medium term.
Fairview Hotels
This acquisition for HotelInvest, follows an active period for the team in the UK who have also sold and franchised back two properties, Novotel Stevenage and Novotel Nottingham, to Fairview Hotels. Fairview, a key partner in the UK since 2008 now own and operate five Accor brand hotels in the country: Mercure London Bloomsbury, Mercure Letchworth Hall, ibis Stevenage and now Novotel Nottingham & Stevenage Novotel Stevenage. Fairview will be investing significantly in both the properties to ensure the consistency and quality of the Novotel Brand is maintained.
For more information click here
Follow us on Twitter @accor