• Accor ups profit estimates

Accor's revenues were up 6.9% on a like-for-like basis in the final quarter of last year, a result that caused the company to upgrade its operating profit before tax estimates for the full-year to slightly above Eu900m.

But despite these robust figures Accor and its peers among the big listed hotel operators are still suffering from negative investor sentiment.

Sales growth in the hotels division for the full year was 5.8%, lfl, with the only weak spot economy hotels in the US where lfl sales were up just 1.5%. Revpar was strongest in upscale and midscale with a 10.0% hike. Revpar for economy hotels in Europe was 6.1%.

The momentum is positive in Europe with the first half showing lfl sales growth of 5.4%, Q3 6.7% and Q4 7.9%. The three big territories of France, Germany and the UK were all strong with even Germany which had the challenge of beating the World Cup uplift in 2006 still showing growth.

With its services division also growing strongly, Accor forecast that profits would exceed Eu900m in 2007 against a previous range of Eu870m to Eu890m.

The Rugby World Cup in France delivered a 0.3 point increase in lfl sales across Accor's hotels. It calculated that upscale and midscale benefited by 0.5 points and economy hotels by 0.1 points.

By contrast, the absence of the soccer world cup in Germany took 1.8 points from lfl sales, hitting economy and more upscale hotels roughly equally.

The impact of these better than expected numbers on Accor's share price is unlikely to radically alter market sentiment towards the stock. From a high reached in April last year of Eu73.70, the share price has declined to yesterday's Eu51.26.

Although 75% of Accor's hotel revenue is generated in Europe, stock market investors seem to be marking down Accor alongside its peers.

Even harder hit, though, has been InterContinental. While IHG generates most of its profit in the US, about 80% comes from fee income rather than direct ownership.

This means IHG has a comparatively resilient business model when compared to hotel operators that own much more of their real estate.

It appears, however, that investors are still not discriminating between companies on this basis and appear to be giving hotel operators little credit for the massive restructurings that have taken place over the last few years.

At IHG the share price has halved since its high of 1420p on June 1, closing last night at 711p. The main fear is a consumer slowdown in the US leading to lower revenues.

But IHG is, alongside Marriott and Choice, among the least exposed of the major operators to cyclicality.

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