ACCOR HOTELS 2024 has been an Accor year

By Foylan Rhodes

Accor S.A., a French multinational hospitality giant, has reported a notable increase in revenue for the first half of 2024, reflecting the company’s robust performance and strategic advancements. With group revenue reaching €2,677 million, Accor has demonstrated an impressive 11% growth compared to the same period in 2023. This performance is attributed to several factors, including a rise in room revenue and strategic acquisitions that have strengthened the Group’s market position. Very different from only two years ago with the company, like many others in the hospitality industry, was still in recovery mode after ‘20 and ‘21.

A Solid Start To 2024

Sébastien Bazin, Chairman and CEO of Accor, expressed confidence in the company’s performance, highlighting that the results for the first half of 2024 align with the medium-term outlook presented to investors last year. Bazin noted that the Group’s success in the second quarter was marked by strong activity across all regions and brands. He emphasized that the Group’s accelerated development pace and enhanced luxury and lifestyle offerings were pivotal to these results.

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“Accor’s involvement in the Paris 2024 Olympic and Paralympic Games, where we provided hospitality services to the Athletes’ Village, Media Village, and other visitors,” he said, “Allowed us to elevate our profile globally on a completely different level. Bolstering our position as an internationally relevant company.”

Regional Performance And Revpar Growth

Accor’s diverse geographic and segmental portfolio continues to be a major asset. During the first half of 2024, the company opened 146 hotels, adding 24,000 rooms to its portfolio, which now totals 838,722 rooms across 5,682 hotels. The pipeline remains strong with 218,000 rooms under development in 1,297 hotels.

In terms of revenue per available room (RevPAR), different regions showed varying performances. The Premium, Midscale, and Economy (PM&E) division experienced a 4% increase in RevPAR for the second quarter of 2024 compared to the previous year, driven more by price increases than by occupancy rates. The Europe North Africa (ENA) region saw a modest 1% increase in RevPAR. Within ENA, France experienced mixed results; while the provinces posted positive RevPAR growth, the Paris region saw a decline due to a high comparison base from June 2023, notably impacted by the Paris Air Show.

Germany outperformed other European markets with stronger RevPAR growth, bolstered by the European Football Championship in June. In contrast, the Middle East, Africa & Asia-Pacific region posted a 7% increase in RevPAR, with substantial contributions from the Middle East and SouthEast Asia. The Middle East, particularly the UAE and Saudi Arabia, benefited from events such as the Hajj pilgrimage, while South-East Asia saw double-digit growth driven by a recovery in Chinese tourist flows.

Conversely, the Pacific region struggled with weak leisure demand, leading to negative RevPAR growth despite improved occupancy rates. In China, RevPAR growth was also negative, reflecting a shift in domestic tourism towards South-East Asia.

The Americas region, significantly influenced by Brazil, recorded a 12% increase in RevPAR, attributed to a vibrant event calendar in São Paulo and Rio de Janeiro.

Performance By Division

Accor’s Luxury & Lifestyle (L&L) division delivered an 8% increase in RevPAR, driven predominantly by higher occupancy rates. The

Luxury segment, which constitutes 76% of the L&L division’s room revenue, saw a 6% increase in RevPAR, driven by improved performance across all luxury brands. The Lifestyle segment experienced a 14% increase in RevPAR, fuelled by price hikes, particularly in resorts located in Turkey, Egypt, and the UAE.

The Group’s revenue growth was split between its two primary divisions. The Premium, Midscale, and Economy division saw a 4% increase, while the Luxury & Lifestyle division grew by 22%. Notably, scope effects from the acquisition of Potel & Chabot contributed €117 million to the revenue. However, currency fluctuations, particularly from the Turkish lira, Australian dollar, Egyptian pound, and Argentine peso, negatively impacted revenue by €63 million.

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Strategic Developments And Future Outlook

Accor’s growth trajectory is underpinned by its strategic focus on diversification and brand expansion. The Group’s “asset-light” model, which emphasizes brand and product management over property ownership, has allowed it to invest in highgrowth areas, particularly in luxury and lifestyle segments.

The Group’s history of expansion and strategic realignment has positioned it as a leader in the global hospitality industry. Founded in 1967, Accor has evolved from its origins with Novotel and Ibis hotels to become the largest hospitality company in Europe and the sixth largest globally. The company’s acquisitions, including those of Potel & Chabot and Orient Express, and its innovative approaches, such as launching new brands and embracing digital transformation, underscore its commitment to growth and adaptability.

Accor’s future looks promising with continued investments in expanding its portfolio and enhancing its luxury and lifestyle offerings. The upcoming Paris 2024 Olympics will further boost its global presence, highlighting the company’s expertise in high-profile events. As Accor continues to navigate the complexities of the global hospitality market, its strategic focus on diversification and premium segments will likely sustain its growth and leadership in the industry.

Bazin indicates that Accor’s strong performance in the first half of 2024 reflects the effectiveness of its strategic initiatives and its ability to adapt to market dynamics, adding, “With robust growth in revenue and RevPAR across various regions and segments, the Group is well-positioned to achieve its targets and further strengthen its position as a leading global hospitality provider.”

All images courtesy of Accor.com www.accor.com