Accor's First Half of 2024 Showcases Solid Performance

The first half of 2024 confirms Accor's growth outlook, as presented at the Capital Markets Day and reiterated in recent earnings and revenue releases. The Group’s diversification, both in terms of geographies and segments, plays a key role for each of the two divisions. Demand remains generally robust and Accor has the required exposure to capture it. During the first half of 2024, Accor opened 146 hotels, representing 24,000 rooms, i.e. net unit growth of 4.1% over the last 12 months. At the end of June 2024, the Group had a hotel portfolio of 838,722 rooms (5,682 hotels) and a pipeline of 218,000 rooms (1,297 hotels).

Second quarter 2024 RevPAR

The Premium, Midscale, and Economy (PM&E) division posted a 4% increase in RevPAR compared to the second quarter of 2023, still mostly driven by prices rather than by occupancy rates.

• The Europe North Africa (ENA) region posted a 1% increase in RevPAR compared to the second quarter of 2023.
• In France, which represents 43% of the region’s room revenue, RevPAR growth was negative compared to the second quarter of 2023, solely due to the Paris region, while the provinces continued to record positive RevPAR growth. This change was anticipated and mainly reflects a high comparison base (due in particular to the presence of the Paris Air Show in June 2023).
• The United Kingdom, representing 13% of the region’s room revenue, posted slightly positive RevPAR growth, in line with the first quarter. The provinces slightly outperformed London.
• In Germany, representing 14% of the region’s room revenue, RevPAR growth was stronger than in France and the UK, particularly in June thanks to the European Football Championship.
• The Middle East, Africa & Asia-Pacific region posted a 7% increase in RevPAR compared to the second quarter of 2023, with a particularly solid performance in the Middle East and South-East Asia.
• The Middle East Africa region, representing 27% of the region’s room revenue, continued to post double-digit RevPAR growth, particularly in the United Arab Emirates and Saudi Arabia. This latter country’s performance was boosted by the Hajj religious pilgrimage in June.
• South-East Asia, representing 30% of the region’s room revenue, also posted double-digit RevPAR growth. Countries such as Thailand benefited from the gradual recovery of Chinese tourist flows.
• The Pacific, representing 25% of the region’s room revenue, recorded an improvement in the occupancy rate compared to the second quarter of 2023, but RevPAR growth was negative due to weak leisure demand.
• In China, representing 19% of the region’s room revenue, RevPAR growth was negative. Tourism has recovered as expected, but is not benefiting the domestic market, as Chinese customers are travelling more to South-East Asian countries.
• The Americas region, which mainly reflects the performance of Brazil (64% of the region’s room revenue), recorded RevPAR growth of 12% compared to the second quarter of 2023. Brazil benefited from a strong event calendar, particularly in Sao Paulo and Rio de Janeiro.

The Luxury & Lifestyle (L&L) division posted an 8% increase in RevPAR compared to the second quarter of 2023, mainly driven by higher occupancy rate.

• The Luxury segment, representing 76% of the division’s room revenue, posted a 6% increase in RevPAR compared to the second quarter of 2023. This performance was driven by all brands. Growth in the occupancy rate was the main factor behind this improvement.
• Lifestyle RevPAR increased by 14% compared to the second quarter of 2023, driven by prices, particularly at resorts in Turkey, Egypt and the United Arab Emirates.

Group revenue

For the first half of 2024, the Group recorded revenue of €2,677 million, up 11% compared to the first half of 2023. This growth breaks down as a 4% increase for the Premium, Midscale and Economy division and a 22% increase for the Luxury & Lifestyle division. Scope effects, mainly related to the takeover of Potel & Chabot (in October 2023) in the Luxury & Lifestyle division (Hotel Assets & Other segment), contributed by €117 million. Currency effects had a negative impact of €63 million, mainly related to the Turkish lira (-39%), the Australian dollar (-4%), the Egyptian pound (-18%) and the Argentine peso (-77%).

Premium, Midscale and Economy revenue 

Premium, Midscale and Economy, which includes fees from Management & Franchise (M&F), Services to Owners and Hotel Assets & Other of the Group’s Premium, Midscale and Economy brands, generated revenue of €1,473 million, up 4% compared to the first half of 2023. This increase is broadly in line with the level of activity in the first half. The Management & Franchise (M&F) business posted revenue of €431 million, up 7% compared to the first half of 2023 and slightly exceeding RevPAR growth during the period (+6%). Services to Owners revenue, which includes Sales, Marketing, Distribution and Loyalty activities, as well as shared services and the reimbursement of hotel costs, amounted to €538 million, up 3% compared to the first half of 2023. This increase, which was more moderate than the change in RevPAR, reflects a base effect from the previous year, mentioned in the first quarter revenue release, which included the re-invoicing of costs incurred by Accor in providing supporter reception services during the soccer World Cup in Qatar. Hotel Assets & Other revenue was up 2% compared to the first half of 2023. This segment, which is closely tied to activity in Australia, is affected by the current weakness of leisure demand.

Luxury & Lifestyle revenue 

Luxury & Lifestyle, which includes fees from Management & Franchise (M&F), Services to Owners and Hotel Assets and Other of the Group’s Luxury & Lifestyle brands, generated revenue of €1,243 million, up 22% compared to the first half of 2023. This increase reflects the excellent performance of this business, the increase of the fees  linked to the residential activity and a scope effect linked to the takeover of Potel & Chabot. The Management & Franchise (M&F) business posted revenue of €242 million, up 15% compared to the first half of 2023, driven by RevPAR growth (+7%) and the favourable timing of fees related to the residential activity in the Lifestyle segment. Services to Owners revenue, which includes Sales, Marketing, Distribution and Loyalty activities, as well as shared services and the reimbursement of hotel costs, amounted to €716 million, up 9% compared to the first half of 2023. This increase is linked to business growth in terms of RevPAR and the number of rooms. Hotel Assets & Other revenue was up 84% compared to the first half of 2023. This activity includes a significant scope effect linked to the takeover of Potel & Chabot in October 2023.

Statement

Sébastien Bazin, chairman and CEO of Accor, said: “Once again in this first half-year, Accor posted solid performances, in line with the medium-term outlook we presented to our investors last year. This demonstrates the strength of our model, the operational and financial discipline of our teams, and the strong momentum of the Group and its brands. Activity in the second quarter remained strong in all regions and for all our brands, our pace of development accelerated and our leading position in luxury and lifestyle was further strengthened by major partnerships. These performances enable us to raise our RevPAR target for 2024 and to reaffirm our confidence in the Group’s strength and ambition. The coming weeks will also be marked by the Paris 2024 Olympic and Paralympic Games, of which Accor is one of the partners. For this unique event, our teams, who have been mobilised for months, will be putting their expertise, their passion for hospitality and their generosity at the service of the Athletes' Village, the Media Village and all visitors to our hotels, thereby helping to raise the profile of France throughout the world.”