French hotel giant Accor slumped to a big loss in 2020 even after setting aside interest, tax, depreciation and amortization costs. The company's EBITDA fell by more than €1.2 billion last year. Earnings before interest, tax, depreciation and amortization were €825 million in 2019. In 2020, the number was -€391 million.
The net loss for the year was just under €2 billion against net profit in 2019 of €485 million. The loss per share was €7.71 against earnings per share last time of €1.55. There is no dividend.
Accor has more than 750,000 rooms in its system at more than 5,000 hotels and other residences. Around 46 percent of the rooms and 59 percent of the hotels are in Europe.
Overall, revenue per available room fell 66 percent in the fourth quarter, slightly worse than the 62 percent decline for the full year. In Europe, RevPAR was down 73 percent in the last three months of 2020 and down 63 percent in the 12 months.
The company said it saw “signs of significant recovery in all regions in the third quarter, with a strong summer season in Europe, after the low point seen in the second quarter.” But it added: “The new restrictions implemented by European governments in response to the resurgence of the epidemic in the last quarter halted the summer recovery.”
At the end of 2020, the company said it had a development pipeline of 212,000 rooms—equivalent to around 28 percent of its current total. It said that three-quarters of the pipeline was in emerging markets.
Sébastien Bazin, chairman and CEO, said: “In 2021, while the vaccine is ensuring a gradual rebound in tourism—largely driven by leisure guests—Accor is ideally positioned to benefit from the recovery and press ahead.”
Short term, Bazin said leisure travel will reignite stronger than anyone believes. “Don’t be late for the rebound,” he advised. Bazin also expressed firm confidence in the industry’s long-term prospects. He said hospitality is “blessed” despite the recent downturn.
Net debt was more or less unchanged at €1.3 billion.
Speculation has circulated in recent months about a possible merger between Accor and IHG Hotels & Resorts. Without mentioning IHG, Jean-Jacques Morin, the deputy CEO, said: “There is plenty of scope for consolidation over time. The question is, how much time? At the moment it is not the right time.”
A version of this story originally appeared on Hotel Management's sister site Hospitality Insights.