Accor has revealed further details of its restructure, which it plans to have in place in early October.
Reporting its financial results for the second quarter of 2022, Sebastien Bazin, chairman and CEO of the France-based hotel company, says the reorganization - dubbed “turbo” - will create two units within the group.
The first group is for economy, midscale and premium hotels, comprising 4,800 properties, which is about 90% of the total portfolio.
Bazin shares that those hotels account for 85% of the group’s fees but two-thirds of its cashflow.
He also says 15 out of the group’s 43 brands would sit in this unit.
The second group will be the luxury and lifestyle unit, including brands within Ennismore as well as Fairmont and Raffles.
He adds that the focus for the restructure is on simplicity and stressed the “leanest ever structure” at holding level with each unit “empowered and autonomous” to make decisions.
Jean-Jacques Morin, Accor's deputy CEO and CFO, will lead the economy, midscale and premium unit and according to Bazin, the focus will be on making it leaner and more efficient.
The luxury and lifestyle unit will be led by a CEO based in New York.
Bazin describes the restructure as a “must” and says: “It’s necessary, indispensable and the right timing because we have scalability today we did not have before.”
He was speaking as the group reported half-year revenue of €1.72 billion, a 97% increase year-on-year.
Hotel services unit revenue increased 119% and hotel assets increased 57%.
The company says the RevPAR comparison to the same period in 2019 represents a 10% decline in revenue.