Accor returns to CAC 40 with 8% revenue growth

As it returned to the CAC 40 during 1Q24, Accor reported earnings that delivered increased revenue in all regions – 8% year over year – and performed exceptionally well in the Middle East and Asia Pacific. RevPAR also increased 8% YOY and portfolio growth accelerated by 3.1%.

"By continuing to combine high standards with operational flexibility, quality of execution and financial discipline, we are confident in our ability to pursue a growth path that is in line with the objectives we have set for ourselves,” said Accor Chairman and CEO Sébastien Bazin.

In the first quarter of 2024, Accor opened 53 hotels (>8,000 rooms). At the end of March, the group had 825,313 rooms (5,613 hotels) and a pipeline of 224,000 rooms (1,297 hotels).

1Q24 RevPAR results

The Premium, Midscale & Economy division posted an 8% increase in RevPAR compared with the first quarter of 2023, still more driven by rates than by occupancy rates.

The Europe North Africa (ENA) region reported a 5% increase in RevPAR compared with the first quarter of 2023.The Middle East, Africa and Asia Pacific region reported a 12% increase in RevPAR compared with the first quarter of 2023. In China, 18% of hotel room revenue in the region, business continued to recover, albeit at a measured pace.

The Americas region, which mainly reflects the performance of Brazil (65% of room revenue for the region), posted a 4% increase in RevPAR compared with the first quarter of 2023. The activity, which had exceeded the occupancy recorded prior to COVID, posted a slight decline in demand. Nevertheless, this slight decline in occupancy was more than offset by higher average rates.

The Luxury & Lifestyle division reported a 7% increase in RevPAR compared with the first quarter of 2023, mainly driven by higher occupancy.

The Luxury segment, 77% of the division's room revenue, posted a 6% increase in RevPAR compared with the first quarter of 2023. Being more exposed to North America than the other segments, luxury RevPAR growth is slightly more modest, reflecting a more mature market.

The Lifestyle segment reported solid RevPAR growth of 10% compared with the first quarter of 2023. This was driven by improved occupancy at resorts in Turkey, Egypt and the United Arab Emirates.

Outlook

The group confirmed its medium-term growth perspectives as disclosed during the Investor Day on June 27, 2023:

• Annualized RevPAR growth between 3% and 4% (CAGR 2023-27)
• Annualized net unit growth between 3% and 5% (CAGR 2023-27)
• M&F revenue growth between 6% and 10% (CAGR 2023-27)
• A marginally positive EBITDA contribution from Services to Owners
• EBITDA growth between 9% and 12% (CAGR 2023-27)
• Recurring free cash flow conversion in excess of 55%
• A return to shareholders of around €3 billion over the 2023-2027 period

In the first quarter of 2024, Accor completed a €400 million share buyback program, with an accretive effect for shareholders through the cancellation of 3.9% of its shares.

A first tranche of share buybacks totalling €275 million was completed through a share purchase agreement signed with Jinjiang International on March 11, 2024. The transaction accounted for 7 million shares at a price per Accor share of €39.22.

The remaining €125 million of the share buyback program, launched on March 20, 2024, was completed on April 4, 2024, with the acquisition of 2,923,228 shares at a average price of €42.93.