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FEBRUARY 2018 — Nº.

24

2017 ANNUAL RESULTS & STRATEGIC REVIEW


WITH SÉBASTIEN BAZIN

RESULTS THAT PAVE THE WAY FOR THE FUTURE!

Wednesday, February 21, 2018. With unprecedented growth in revenue of 17.7% and strong results,
AccorHotels can look back at another year of solid growth. Sébastien Bazin believes that the record
performance is proof that the strategic decisions first implemented in four years ago are taking
the Group in the right direction. Deeply transformed and championing a vision for augmented
hospitality, the Group is perfectly positioned to best exploit the growth in spending expected in
global tourism and travel industry.

2017 REALLY WAS AN EXCEPTIONAL YEAR Furthermore, we have succeeded in placing the client
FOR THE GROUP. WHAT ARE YOUR experience and innovation at the heart of our business.
Thanks to our global client database, ACDC, we are
THOUGHTS AT THE MOMENT?
increasingly able to personalize our relationship with our
Sébastien Bazin. AccorHotels has never been stronger. guests, and we have started to take our first steps into the
We have considerably enriched our hotel network and world of artificial intelligence to further improve this
brand portfolio. The bar of 600,000 rooms was crossed this relationship. Finally, some of our brands, such as Ibis,
year, and with organic growth of 41,000 new rooms across Novotel and Swissôtel, unveiled new bedroom concepts in
all segments and regions, we have strengthened our 2017, demonstrating that even our most well-established
leadership position in our target markets in Europe, Asia- brands know how to innovate
Pacific, the Middle East and Africa, and South America.
Our portfolio has doubled over the last four years and we
have become a major player in the Luxury segment, with
iconic brands such as Raffles, Fairmont and those that
joined the Group in 2017, like Rixos, Banyan Tree and 51,400
Orient Express. We have expanded our sphere into the
upscale private rental market with onefinestay, into the rooms opened Of which
in 2017
41,000
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hotel digital services market, with Gekko and Availpro,


into concierge services with John Paul and into catering
and events with Noctis and Potel & Chabot.
from organic
growth (excl.
acquisitions)

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ACCORHOTELS Highlights I ANNUAL RESULTS & STRATEGIC REVIEW I FEBRUARY 2018 — Nº. 24

REVENUE AND EBIT GREW SIGNIFICANTLY in all key regions, with revenue on the rise, especially in
IN 2017. WHAT DROVE THIS RECORD Asia-Pacific (up 7.7%) and Europe (up 7.2%), as well as in
North America (up 5.2%), the Middle East/Africa region (up
PERFORMANCE?
2.7%), France and Switzerland (up 2.5%). Only South
America recorded a decline, but business levels stabilized
Sébastien Bazin. Several factors were behind these
in the fourth quarter of 2017.
impressive figures. Revenue was up 17.7% (7.9% at
constant scope and exchange rates) and EBIT increased by Momentum is strong, and more than anything, it is
23.9% (10.1% like for like). In France, demand was high, balanced. In Central Europe, performance continued to be
which enabled us to increase prices. High occupancy rates very satisfying for Orbis. Our new operations are now
across the entire network also boosted performance, in focused on revenue growth more than anything, and are
particular in the final quarter of 2017. Business was strong forecast to reach break-even point in 2019.

«We have a very solid base and are lucky to be operating in a global tourism and
travel industry that is enjoying strong levels of growth»

IN 2013, YOU SET OUT YOUR AMBITION THE GROUP HAS INVESTED IN A LARGE
FOR ACCORHOTELS TO BECOME THE TOP NUMBER OF ACQUISITIONS. HOW DO YOU
PERFORMING, HIGHEST VALUED HOTELS VIEW THE RESULTS OF THIS STRATEGY?
GROUP IN THE WORLD. HAS THIS GOAL
BEEN ACHIEVED? Sébastien Bazin. We have invested €6.3 billion over the
last four years and it is important to understand that the
Sébastien Bazin. We have worked very hard, and yes, the majority of this money has been invested into the heart of
results are there for all to see. The first thing to note is our business. Another major satisfaction is that we have
that the rebalancing of our profile has been a success. The exceeded our expectations in terms of performance. The
Luxury segment, which accounted for only 22% of fees in €65 million in synergies that we were anticipating after
2014, now generates 41% of this revenue. We are marking the takeover of FRHI will be achieved earlier than
rapid progress in high-growth segments and regions in expected. And the partnership with Huazhu has proved to
which we are leaders. The share held by emerging markets have been the right decision. Huazhu’s market
– the highest growth markets over the coming years – has capitalization has multiplied by 5.5 since our initial
shot up by 7 points since 2013. The second thing I wanted investment.
to mention was that our expertise as a hotel operator and
our digital tools are well-known for being highly effective.
Our tools for retaining customers, distribution and even
BtoB sales currently account for over 60% of hotel
revenue. The third cause for celebration is that the
restructuring of AccorInvest’s portfolio has created
considerable value. The Group’s financial profile has
finally improved and we are in the process of successfully
transitioning toward an asset light model. I’ll say it again,
AccorHotels has never been stronger!

* The asset light model means that the hotel operator does not own
the actual building of the hotel being operated.
ACCORHOTELS Highlights I ANNUAL RESULTS & STRATEGIC REVIEW I FEBRUARY 2018 — Nº. 24

WHAT IS YOUR OUTLOOK FOR 2018 AND


BEYOND?
Sébastien Bazin. It is extremely positive. We are lucky to
be operating in a global tourism and travel industry that is
enjoying strong levels of growth. Between 2010 and 2017,
spending in this market grew by 3.5%. By 2020, that figure
is expected to double. With a very solid base, we are in an
ideal position to step up our development. We are market
leaders with a balanced geographical presence and we
currently have 874 hotels in the pipeline, 79% of which are
located in high-growth markets (including 47% in Asia-
Pacific). We have solid IT systems, a dynamic set up
geared toward innovation and an excellent loyalty
program.

«AccorHotels is seen to be an attractive


business, both for customers and
partners. »

Our expertise as a hotel operator is well renowned. Our


profession is changing and the reinvention of the
hospitality industry relies in particular on our 250,000
employees throughout the world who are making this
transformation a reality. We are going to continue to Pullman Port Douglas Sea Temple Resort & Spa - Australie
grow, to be where the travelers and consumers of
tomorrow will be – in Europe, Asia-Pacific, Africa and the
Middle East.
TOMORROW'S TOURISM, BEYONG
And we are going to achieve all that with our asset light INTERNATIONAL TOURISM
model, for the benefit of all those who travel – tourists,
nomads and neighbors – and in partnership with all those AccorHotels is operating in a high-growth market. On a
who facilitate such travel – hotel owners and managers, global scale, the tourism industry is the second fastest
distribution partners and start-ups. growing sector behind communication technologies.
Through its partners, AccorHotels creates traffic, value and Over the next 10 years, tourism alone will account for
performance. The more top quality partners the Group has, 23% of new jobs throughout the world and will generate
the more we are able to offer our customers the greatest
7% of global exports. In this quickly expanding
choice of destinations, and the better we are able to attract
environment, international movement will evolve.
and retain new customers.
Chinese travelers already spend twice as must as
American tourists. It is in Europe and Asia-Pacific that
tourism will enjoy the greatest leap forward – with
growth expected to come in at around 8% and 5%,
respectively, while North America will only see a 2% rise.
But this international travel represents only around 30%
of the global tourism industry. Over 70% of spending on
travel and tourism comes from domestic travel, which is
why it is important to strengthen our positions in
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countries where we are already market leaders. And


nowadays, leisure enjoys the lion’s share of tourist
spending, with over 75% of their budget reserved for
such activities. In this context, the Group’s acquisition
strategy in the leisure market appears highly astute.

Source : The World Travel & Tourism Council (WTTC)

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ACCORHOTELS Highlights I ANNUAL RESULTS & STRATEGIC REVIEW I FEBRUARY 2018 — Nº. 24

Key takeaways
1. PROMINENT MARKET LEADER
 AccorHotels is market leader in all its key regions, those that will experience the highest rates of growth
over the coming years.

2. A RECORD-BREAKING YEAR OF GROWTH


 Growth of over 4.7% in RevPAR and 7.9% in revenue at constant scope and exchange rates.

3. A STRONG, BALANCED PORTFOLIO OF BRANDS


 25 hospitality brands, an additional 12 brands in just four years.

4. THE BAR OF 600,000 ROOMS CROSSED


 260 hotels and 41,000 rooms opened. 2017 has been a new record breaking year.

5. A PIPELINE COMING TO FRUITION


 An additional 25,000 rooms in the project pipeline. The conversion rate sits at 110%, meaning that the
number of effective hotel openings is greater than 10% the number originally planned.

6. A COMPLETE TRANSFORMATION OF BOTH OUR PROFESSION AND OUR CULTURE


 Transformation of our profession, toward a stronger culture of service provision.
 Transformation of our culture with Heartist®, an employee commitment to our shared passion: our
customers.

7. OUR SIX STRATEGIC POLICIES TO GROW ACCORHOTELS


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ACCORHOTELS – DIRECTION DE LA COMMUNICATION – 82, rue Henri Farman CS 20077 – 92445 Issy-les-Moulineaux – France | DIRECTEUR DE
LA PUBLICATION : Virginie Sido | RÉDACTEUR EN CHEF : Cécile Brosseau | RÉDACTRICE : Françoise Moinet | CRÉDITS PHOTO / Maleika Halpin  

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