PARIS, April 16 /PRNewswire-FirstCall/ -- In the midst of an
unprecedented recession, - Strong performance in Prepaid Services,
with an 8.3% increase. - Worsening business conditions in Hotels,
with an 8.7% decline despite resistance in Economy Hotels in France
(down 3.2%). - New cost-saving initiatives: - A EUR175 million
annual reduction in renovation capital expenditure in 2009 and
2010, compared with 2008. - A larger cost-saving plan, in addition
to the already announced EUR100 million program. Consolidated
revenue for the first three months of 2009 totaled EUR1,616
million, down 5.8% like-for-like over the same period of 2008 and
down 9.6% on a reported basis. (in EUR millions) 2008 2009 % change
% change as reported like-for-like (1) Hotels 1,282 1,182 -7.8%
-8.7% Upscale and 757 687 -9.2% -9.2% Midscale Economy 388 358
-7.7% -6.8% Economy US 137 137 0.0% -11.5% Prepaid Services 227 231
+2.0% +8.3% Other businesses 278 203 -27.2% -3.8% Total 1,787 (2)
1,616 -9.6% -5.8% (1) At constant scope of consolidation and
exchange rates. (2) Adjustment related to loyalty program: impact
of the IFRIC 13 application, retroactive to January 1st, 2008.
First-quarter 2009 revenue performance reflects the impact of: -
The strategic refocusing on the Hotels and Prepaid Services
businesses (with the disposal of the Brazilian foodservices
operations) and the continued deployment of the "asset-right"
strategy, which had a negative 6.4% impact on revenue for the
period. - The expansion strategy, which added 4.1% to growth for
the quarter (of which EUR45 million from the full consolidation of
Orbis). - The negative 1.5% currency effect, resulting from the
appreciation of the euro against the British pound, the Australian
dollar and the Brazilian real. On the upside, the dollar impact was
a positive 1.1%. - On the like-for-like basis, the revenue declined
by 5.8% for the quarter. Strong performance in Prepaid Services,
with an 8.3% increase in the midst of an unprecedented recession
Revenue from the Prepaid Services business stood at EUR231 million,
up 2.0% as reported, reflecting in particular the following
factors: - A negative 4.6% currency effect, mainly due to the
weakness of the British pound and Latin American currencies against
the euro. - A like-for-like increase of 8.3%, in line with the
medium-term target. Adjusted for the impact of the gradual
elimination of tax breaks in Argentina, Prepaid Services revenue
was up 11.1% for the quarter. Prepaid Services in Europe: up 5.8%
like-for-like In France, revenue grew by 7.1% like-for-like,
despite a 5.3% decline in financial revenue. Excluding gift
vouchers, whose revenue rose 0.4% and accounted for 25% of the
business' revenue in France, the increase was 10.0% for the
quarter. In the United Kingdom, revenue was up 7.0% like-for-like,
despite a 6.1% decline in financial revenue. Childcare Voucher
revenue rose 12.0% during the period, while gift card revenue,
which accounts for just 15% of total prepaid service revenue in the
UK, declined by 16.3%. Prepaid Services in Latin America: up 11.6%
like-for-like Revenue rose a like-for-like 16.3% in Brazil over the
quarter, led by gains of 10.3% for Ticket Restaurante, 27.5% for
Ticket Alimentacao and 20.1% for Ticket Car. In the rest of Latin
America, like-for-like growth totaled 24.3% excluding Brazil and
the impact of the gradual elimination of tax breaks in Argentina.
Worsening business conditions in Hotels, with an 8.7% decline
like-for-like Hotels revenue amounted to EUR1,182 million in the
first quarter, a year-on-year decline of 7.8% as reported. This
figure takes into account the impact of: - The sale of hotel
properties as part of the "asset-right" strategy, which reduced
growth for the quarter by 2.4%. - The expansion strategy, which
added 4.2% to growth thanks to the opening of 5,110 rooms and the
EUR32 million impact from the full consolidation of Orbis. - The
currency effect, which was a negative 0.9% for the period. - At
constant scope of consolidation and exchange rates, Hotels revenue
was down 8.7%. The shift in the Easter vacation calendar, to April
2009 from March in 2008, in most European countries (mainly
Germany, Spain and Belgium) had a positive 0.9-point impact on
revenue. This was offset, however, by the 1.0-point negative impact
from the fact that 2009 had one less day than 2008, which was a
leap year. Upscale and Midscale Hotels: down 9.2% like-for-like In
the Upscale and Midscale segment, revenue was down 9.2% as reported
for the period. In general, the Midscale segment was relatively
less affected than the Upscale segment. This was the case in
France, where RevPAR declined 10.1% in the Midscale and 13.4% in
the Upscale. Moreover, business in Paris was more affected than in
the rest of the country, with RevPAR down 14.7% in the capital
versus 6.6% elsewhere. In Germany, revenue declined by 1.9%
like-for-like over the period, or by 8.1% adjusted for the shift in
the Easter vacation period. In the United Kingdom, business was
harder hit outside London, with RevPAR down 16.5%, than in London,
down 7.0%. Economy Hotels outside the US: down 6.8% like-for-like
RevPAR volatility in this segment is typically around twice the
change in GDP, which is notably lower than in the Up and Midscale
segments (where elasticity is 4 to 6). Given the unprecedented drop
in GDP in most European countries, Economy Hotels revenue declined
by 7.7% as reported and 6.8% like-for-like during the first
quarter. In France, revenue was down 3.2% like-for-like, or just
2.7% adjusted for the impact of the F1 hotels renovation program.
As was the case in the Upscale and Midscale segment, business
outside Paris fared better than in the capital, with RevPAR down
5.1% in Paris but up 0.9% in the rest of the country. Revenue in
Germany was down 5.0% like-for-like, of which 4.6% for Ibis as well
as for Etap Hotel. In the United Kingdom, business in London was
more affected than in the rest of the country, with RevPAR down
15.1% and RevPAR down 11.5% elsewhere. Revenue was more severely
affected in certain other European countries, such as Spain (down
29.3% like-for-like), Italy (down 17.5%), the Netherlands (down
10.9%) and Belgium (down 10.5%). Economy Hotels in the US: down
11.5% like-for-like The Economy segment experienced an 11.5%
decline like-for-like, but remained less affected than the Upscale
and Midscale segments in the United States. Furthermore, Motel 6
outperformed its competitive-set, in a segment that saw a decline
in business for the second year in a row. The opening of
approximately 50 hotels in 2008 drove a 19.4% increase in fees from
franchised hotels during the first quarter on 2009. New cost-saving
initiatives in the midst of an unprecedented recession In a
first-quarter business environment shaped by a faster decline in
revenue compared with fourth-quarter 2008, particularly in Europe,
Accor has decided to reduce its 2009 and 2010 annual renovation
budget to EUR315 million, or EUR175 million less than in 2008. In
addition to the already announced program to reduce support costs
by EUR75 million in 2009 and a further EUR25 million in 2010, Accor
is already planning to increase its cost-saving program. Quarterly
Information Significant transactions and events of the period
Creation of a leading joint venture with MasterCard Europe in the
European prepaid market In mid February, Accor Services and
MasterCard Europe announced a strategic alliance resulting in the
creation of PrePay Solutions, which is owned 67% by Accor Services
and 33% by MasterCard Europe. PrePay Solutions will provide
services to Accor Services and MasterCard, enabling each firm to
offer its respective customers - corporates, local authorities and
government agencies for Accor Services, banks and other financial
institutions for MasterCard - solutions leveraging the partners'
closely related expertise in prepaid services and electronic
payments. These customers will therefore be able to take advantage
of the strong growth in the European prepaid market, which is
estimated at EUR130 billion. At the same time, PrePay Solutions
will market prepaid solutions directly to its own customers, such
as retailers. Financial position and results Successful bond issue
in January 2009 On January 28, 2009, Accor successfully placed a
EUR600 million issue of fixed-rate, five-year bonds, maturing
February 4, 2014 and paying 7.50% interest. The bonds were placed
with more than 200 European institutional investors. The
transaction enabled the Group to diversify its financing sources
and increase the average maturity of its debt. CIWLT dispute On
December 12, 2008, the Cergy Pontoise Administrative Court handed
down a ruling against CIWLT, which was immediately enforceable even
in the event of an appeal, thereby lifting the suspension
previously applied to claims for the years from 1998 to 2002. As a
result, Accor settled the claims and late interest on February 27,
2009, in a total amount of EUR242.5 million. Stake in Groupe Lucien
Barriere raised to 49% Under the January 2004 agreements signed by
Colony Capital, the Desseigne Barriere family and Accor, Colony
Capital held a put option to sell its 15% stake in Groupe Lucien
Barriere SAS to Accor for a price to be determined by five
independent banks. In November 2008, Colony Capital informed Accor
that it intended to initiate the valuation process. The process
resulted in a price of EUR153 million, corresponding to the average
valuation of the independent experts, excluding both the highest
and the lowest valuation in accordance with the 2004 agreements.
Following the valuation process, Colony Capital decided to exercise
its put for EUR153 million, which was paid on April 15, 2009. The
transaction is expected to increase Accor's consolidated net debt
by EUR270 million, following the proportional consolidation of 49%
of Groupe Lucien Barriere's debt in the second half. Financial
resources The cash position is solid with EUR1.5 billion in unused
committed credit lines as of mid-April 2009, after taking into
account the above items. During the period, Fitch has confirmed its
BBB long-term rating with stable outlook, and Standard & Poor's
its BBB long-term rating with negative outlook. Accor, a major
global group and the European leader in hotels, as well as the
global leader in services to corporate clients and public
institutions, operates in nearly 100 countries with 150,000
employees. It offers to its clients over 40 years of expertise in
two core businesses: - Hotels, with the Sofitel, Pullman, MGallery,
Novotel, Mercure, Suitehotel, Ibis, all seasons, Etap Hotel,
Formule 1 and Motel 6 brands, representing 4,000 hotels and nearly
500,000 rooms in 90 countries, as well as strategically related
activities, such as Lenotre. - Services, with 32 million people in
40 countries benefiting from Accor Services products in employee
and public benefits, rewards and loyalty, and expense management.
Quarter 1 Quarter 1 In EUR thousand 2,008 2,009 Change Change
Reported % L/L % (1) HOTELS Up & Midscale 756.767 687.18 -9.2%
-9.2% Economy 388.094 358.017 -7.7% -6.8% Economy US 137.254
137.235 0.0% -11.5% TOTAL HOTELS 1,282,115 1,182,432 -7.8% -8.7%
SERVICES 226.637 231.163 2.0% 8.3% Other Businesses Casinos 86.253
82.994 -3.8% -6.3% Restaurants (3) 100.937 22.161 -78.0% -7.3%
On-board train Services 69.461 66.802 -3.8% 4.7% Holding &
Other (4) 21.918 30.816 40.6% -4.7% TOTAL OTHER BUSINESSES 278.569
202.773 -27.2% -3.8% TOTAL 1,787,321 1,616,368 -9.6% -5.8% (1) at
constant scope of consolidation and exchange rates HOTELS : RevPAR
by segment T1 Occupancy Rate Subsidiaries (in %) (chg in pts (chg
in pts L/L reported) (1)) Upscale and Midscale Europe (in EUR) 51.8
-7.7 -5.8 Economy Europe (in EUR) 59.3 -7.0 -7.1 Economy US (in $)
57.2 -4.7 -5.0 - TABLE CONTINUED - Average room rate Subsidiaries
(chg in % (chg in % L/L (1)) reported) Upscale and Midscale Europe
(in EUR) 99 -5.5% -0.9% Economy Europe (in EUR) 57 +1.3% +3.4%
Economy US (in $) 43 -3.4% -3.8% - TABLE CONTINUED - RevPAR
Subsidiaries Subsidiaries Subsidiaries (chg in % (like-for-like(1))
& managed Upscale and Midscale reported) (reported) Europe (in
EUR) 52 -17.7% -10.5% -17.9% Economy Europe (in EUR) 34 -9.4% -7.6%
-9.3% Economy US (in $) 24 -10.8% -11.6% -10.8% (1) at comparable
scope of consolidation and exchange rates. UPSCALE AND MIDSCALE
HOTELS Occupancy Rate RevPAR by country T1 Subsidiaries (in local
currency) Nb of (in %) (chg in pts (chg in pts L/L rooms reported)
(1)) France 29,691 53.2 -7.7 -7.5 Germany 19,664 56.2 -1.7 -2.0
Netherlands 3,907 53.7 -4.8 -4.8 Belgium 1,801 57.4 -6.0 -6.0 Spain
2,281 43.9 -14.0 -13.6 Italy 3,429 46.6 -4.7 -3.3 UK ( in GBP)
5,432 69.1 -4.6 -4.7 - TABLE CONTINUED - Average Room Rate
Subsidiaries (in local currency) Nb of (chg in % (chg in % L/L
rooms reported) (1)) France 116 +1.6% +1.6% Germany 95 +1.5% +1.0%
Netherlands 97 -9.9% -9.9% Belgium 110 -1.6% -1.6% Spain 93 -15.2%
-15.1% Italy 96 -11.2% -10.1% UK ( in GBP) 84 -4.6% -5.5% - TABLE
CONTINUED - RevPAR Subsidiaries Subsidiaries Subsidiaries &
managed (chg in % (like-for-like(1)) (reported) (in local currency)
reported) France 62 -11.2% -10.8% -11.8% Germany 54 -1.4% -2.5%
-1.5% Netherlands 52 -17.3% -17.3% -18.5% Belgium 63 -10.9% -10.9%
-8.2% Spain 41 -35.6% -35.1% -35.6% Italy 45 -19.4% -15.8% -18.9%
UK ( in GBP) 58 -10.5% -11.4% -11.0% (1) at comparable scope of
consolidation and exchange rates. ECONOMY HOTELS Nb of Occupancy
Rate RevPAR by country T1 rooms Subsidiaries (in %) (chg in pts
(chg in pts L/L (in local currency) reported) (1)) France 41,911
61.7 -5.1 -5.9 Germany 15,076 58.8 -4.6 -4.6 Netherlands 2,211 56.7
-11.4 -11.4 Belgium 2,562 61.0 -8.3 -8.3 Spain 4,595 52.5 -16.9
-17.6 Italy 1,550 47.7 -4.7 -4.7 UK ( in GBP) 8,813 61.9 -9.4 -8.3
USA (in $) 78,033 57.2 -4.7 -5.0 - TABLE CONTINUED - ECONOMY HOTELS
Average room rate RevPAR by country T1 Subsidiaries (chg in % (chg
in % L/L (1)) (in local currency) reported) France 54 +8.5% +7.5%
Germany 62 +3.7% +3.4% Netherlands 75 -2.5% -2.5% Belgium 70 +1.6%
+1.6% Spain 55 -3.6% -4.0% Italy 74 -7.7% -7.7% UK ( in GBP) 52
-4.7% -1.7% USA (in $) 43 -3.4% -3.8% - TABLE CONTINUED - ECONOMY
HOTELS RevPAR RevPAR by country T1 Subsidiaries Subsidiaries
Subsidiaries & managed (chg in % (like-for-like(1)) reported)
(reported) (in local currency) France 33 +0.2% -1.9% +0.2% Germany
36 +3.8% -4.2% -1.3% Netherlands 43 -18.8% -18.8% -18.8% Belgium 43
-10.5% -10.5% -10.5% Spain 29 -27.2% -28.4% -27.2% Italy 35 -15.9%
-15.9% -15.9% UK ( in GBP) 32 -17.3% -13.1% -17.1% USA (in $) 24
-10.8% -11.6% -10.8% (1) at comparable scope of consolidation and
exchange rates. DATASOURCE: Accor CONTACT: Media Contacts: Alain
Delrieu, Senior Media Relations Officer, Phone: +33-1-45-38-84-85;
Aurelie Langevin, Press Officer, Phone: +33-1-45-38-84-76;
Investors Contacts: Eliane Rouyer-Chevalier, Senior Vice President,
Investor Relations and Financial Communication, Phone:
+33-1-45-38-86-26; Olivia Testas, Investor Relations, Phone:
+33-1-45-38-86-33
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