Luxury, lifestyle drive Accor revenue gains

PARIS – Accor reported 3Q24 earnings and boasted a 12% year-over-year increase in revenue, led by an 18% bump in its Luxury & Lifestyle division and a 7% increase in Premium, Midscale & Economy (PM&E) segments.

Accor opened 47 hotels (8,000 rooms) in the quarter, representing net network growth of 3.2% over the past 12 months. At the end of September 2024, the group had a hotel portfolio of 838,826 rooms (5,638 hotels) and a pipeline of 231,00 rooms (1,380 hotels). Its pipeline is up 6% versus the end of 2Q24.

RevPAR was up 5.3% versus 3Q23 with the PM&E division reporting a 5% YOY increase and Luxury & Lifestyle a 7%, occupancy-driven bump.

Looking ahead, Accor said it expects RevPAR growth between 4% and 5% for the full year, net unit growth between 3% and 4%, and a positive contribution to EBITDA from Owner Services.

Accor also revised upwards its guidance for Group EBITDA, which is now expected to be between €1.100 billion and €1.125 billion.

“Once again this quarter, the group posted solid sales growth, in line with its targets,” said Accor Chairman and CEO Sébastien Bazin. “This good performance was driven in particular by the dynamism of our luxury and lifestyle brands, sustained growth in high-potential regions and the positive impact in France of the Olympic Games, for which Accor was one of the premium partners. By continuing to combine operational agility, quality of execution and financial discipline, we are convinced of our ability to consolidate the solidity of our business model over the long term and deliver significant growth in our results in 2024.”

PM&E performance

While RevPAR growth is normalizing, Accor said it continues to benefit from its geographic and segment diversification.

In its PM&E brands, Europe North Africa posted a 6% increase in RevPAR compared to the third quarter of 2023. The United Kingdom posted slightly positive RevPAR growth in line with previous quarters, with similar performances between London and the provinces. In Germany RevPAR growth was stronger than in the two countries mentioned above throughout the summer.

The Middle East, Africa & Asia-Pacific region posted a 1% increase in RevPAR compared to the third quarter of 2023, with contrasted performances by country.

Southeast Asia was the zone with the strongest RevPAR growth, driven by international demand, including from China.

The Middle East, Africa was negatively impacted by the timing of religious pilgrimages, including the Hajj, and the delayed start of the Umrah in Saudi Arabia. Added to this is the gradual reopening of five hotels in Dubai which were closed following the floods in April. Nevertheless, Accor said it saw a sequential improvement of the activity month after month.

In the Pacific, RevPAR growth was flat, penalized by weak economic growth and low consumer confidence.

In China, representing 21% of the region's room revenue, RevPAR change was negative.

The Americas region, which mainly reflects the performance of Brazil (60% of the region’s room revenue), recorded an increase in RevPAR due to strong demand, particularly from business customers and events in Sao Paulo.

Luxury & Lifestyle

The Luxury & Lifestyledivision posted a 7% increase in RevPAR compared to the third quarter of 2023, mainly driven by higher occupancy rate.

The Luxury segment, representing 73% of the division's room revenue, reported a 5% increase in RevPAR compared with the third quarter of 2023. This performance was driven by all brands and reflects the various trends observed in PM&E's markets, but with a slight premium.

The Lifestyle division reported RevPAR growth of 14% compared with the third quarter of 2023, once again driven by resort hotels, notably in Turkey and Egypt.