AccorHotels remains committed to its new businesses, despite a "disappointing" performances from its luxury home rental brand onefinestay and concierge service JohnPaul.
The top-line financials for the six months to end-June18 are generally strong across the many and various metrics used by a hospitality chain which operates “more than 4,500 hotels and 650,000 rooms around the world.”
- Business volumes of €8.9 billion, up 10.3% at constant exchange rates
- Revenue of €1,459 million, up 8.0% like for like
- EBITDA of €291 million, up 4.2% like for like
Digital details
The role of technology and distribution within the business is discussed at various stages within its 2018 Interim Financial Report. The section is headed up “Disciplined investments to create an efficient digital sales and loyalty ecosystem, and to enrich its services offering” and introduced with:
“In an environment shaped by the accelerating pace of change in both technologies and usage, the arrival of new digital disruptors and the need to refresh the codes of the conventional hotel market, the Group has meticulously crafted a new ecosystem in a comprehensive approach to digital challenges, with a view to enhancing the exclusive nature of the experiences offered to guests.”
It believes that the combination of traditional hospitality service, backed up and informed by tech which can help give guests a personalized experience, is key. It talked about the Accor Customer Digital Card (ACDC) which “gathers customer data with a view to facilitating predictive analysis of individual preferences and delivering the highest level of personalization during peoples' stays.”
This has been in place at all group hotels since June 2018.
It also mentioned the AccorHotels reservation system (TARS), which is registering an annual business volume of €7.7 billion. It responds to “280 availability requests every second, adjusting 9 million prices every day and logging 1.7 bookings per second”
AccorHotels.com is getting 12 million visits a month, significantly more than its app which is receiving 2.9 million visits a month.
Elsewhere, it said that it sends out 1.2 billion “increasingly personalized” marketing emails to customers every year. And that it has 25 million fans across social networks.
The section on its loyalty schemes – LeClub AccorHotels – has some impressive volume stats but also references actual earnings. In the first half of 2018, “30% of the group’s total revenue was captured directly through group loyalty programs” and there were 45 million members.
New businesses
Elsewhere, the Interim Financial Report also devotes a section to “new businesses”, which now is reported separately. This unit comprises hotel tech businesses FastBooking and Availpro, luxury homes rental brands onefinestay and Travel Keys, private sales brand VeryChic and concierge service John Paul.
More recent acquisition Gekko – “a hotel booking platform for business and leisure travel with a network of 300 corporate customers, 14,000 travel agencies in seven countries, and 600,000 hotels and private rentals spread around the world” is also part of new businesses.
Overall, the unit generated €70 million of revenue and an EBITDA loss of €14 million. Availpro, Fastbooking and VeryChic were credited with helping the revenue growth, but the unit was “weighed down by disappointing results from onefinestay.”
It explained:
“The division's negative results are primarily linked to onefinestay and John Paul, whose revenue growth is closely correlated with development plans and synergies with AccorHotels’ that have not yet been implemented as planned. This, combined with growing development costs, has led to a negative scissor effect weighing on their current performance.”
The disappointment is made real in a €246 million impairment charge.
Nonetheless, “despite these difficulties, the Group firmly believes in the strong potential for the luxury home rentals and concierge services offers in its ecosystem.”
AF-KLM deal doesn’t fly
Elsewhere, AccorHotels said that it was no longer
in talks with Air France-KLM about a “strategic alliance”. However, it “remains convinced that a strengthened partnership between hotel companies and airlines offers significant value creation potential.”
Click here to access the investor relations holding page where all the various 2018 H1 releases, reports and presentations can be accessed.