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Published on Thursday, February 26, 2009

Economy hotels boost Accor’s bottom line


PARIS – The Accor hotel group has released its 2008 results, indicating it has so far withstood the economic downturn.

Operating profit before tax and non-recurring items was €875 million, on target, and up 13.0 percent like-for-like excluding the impact of the return to shareholders

Operating margin was up 1.0 point to 29.6 percent.

Consolidated revenue totaled €7.73 million in 2008, representing a 2.8 percent increase at comparable scope of consolidation and exchange rates (like-for-like) and a 4.7 percent decline as reported.

Reported revenue was negatively impacted by the large number of asset disposals during the year and the unfavourable currency
effect, notably from the US dollar and the British pound against the euro.

The 2.8 percent like-for-like growth was led by sustained gains in Prepaid Services and the firm resistance of economy hotels outside the United States.

Depending on global demand, Accor said it would focus its expansion of capital expenditure on the economy hotels outside the US segment and asset-light operating structures in the upscale and mid-scale segment.

In addition, the group may shift to acquiring hotel properties rather than driving organic growth.

Accor opened 28,000 new rooms during the year, 89 percent in the economy and mid-scale segments.

Of the total, 79 percent are being operated under low capital-intensive structures, such as variable-rent leases, management contracts and franchise agreements.

Sustained expansion remains a priority, with 101,000 rooms in the pipeline.

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