Asset-light shift drives Accor revenue

Accor credits the addition of Mövenpick for some of its gains in 2019. Pictured is the Mövenpick Nabatean Castle Hotel in Jordan. Photo credit: Accor (Mohd Shahaltough renovates rooms of Petra’s fortress-style Mövenpick Nabatean Castle Hotel.)

As he began Accor’s full-year 2019 earnings presentation, Chairman/CEO Sébastien Bazin announced that the company’s “transformation” into an asset-light company was essentially complete, having sold off 50 years’ worth of real estate. 

“We are 96 percent asset-light,” Bazin told the crowd, and emphasized the company would be “tackling” that remainder. “Accor is, today, a pure asset-light company.” 

The efforts appear to have paid off well, with the company achieving its targets despite what Bazin called a difficult macroeconomic background, including the trade war between the U.S. and China, which affected global gross domestic product. A number of other events affected revenue per available room at properties around the world, such as conflicts in Hong Kong, bushfires in Australia, the U.K.’s departure from the European Union, strikes in Paris and “turmoil” in Chile, Argentina and Peru.

By the Numbers

In spite of these challenges, Accor’s consolidated full-year 2019 revenue reached €4.05 billion, up 16 percent compared with full-year 2018. Changes in the scope of consolidation (acquisitions and disposals) had a positive impact of €380 million (up 10.9 percent), which the company credits to the contributions of Mantra and Mövenpick, both of which joined the company in 2018.

Related Article: Accor ‘to keep pedalling’

Consolidated RevPAR increased 1.7 percent overall during the period. Hotel assets and other revenue was up 2.9 percent like for like to €1.077 billion. Consolidated EBITDA stood at €825 million as of the end of the year, up 14.8 percent as reported compared with full-year 2018. This is in line with the target range of €820 million to €840 million announced by the group in October.

Unit Growth

The company broke development records in 2019, with net organic growth up 5.1 percent year over year. After opening a record 45,108 rooms in 327 hotels on an organic basis during the period—including 12,954 rooms in 65 hotels in the luxury segment alone—Accor had a portfolio of 739,537 rooms in 5,036 hotels. 

The company also signed 510 hotels with 76,000 guestrooms during 2019 (another record), building its pipeline to 208,000 rooms in 1,206 hotels as of the end of the year. More than three quarters of this pipeline is in emerging markets, and Bazin said that more than 50 percent of Accor’s portfolio will be in the luxury segment, up from 41 percent today. “The only way you can continue to get through difficult RevPAR times is to keep signing rooms,” he added, noting the company signed more than 18,000 rooms in Q4 alone.