• Accor cuts profit projections

Accor said last week that it is expecting negative revpar performances for hotels in the Netherlands, Belgium, Spain and Italy. In the UK, revpar was expected to be much weaker.

Only France and Germany were expected to be more resilient as the third quarter sales figures reflected "the first signs of a real economic downturn".

The third quarter revpar figures for economy hotels showed a double digit drop in the Netherlands and significant declines in Spain, Italy and the US. Belgium was flat. The strongest performance was the UK with a rise of 5.5%.

The picture for upscale and midscale was similar and overall worse, with total like-for-like sales down 0.4% in Europe against a rise of 0.5% in Europe for economy hotels.

Accor said that the first two weeks of September had been very weak and the second two weeks better. But the lack of visibility meant the company revised down its full-year operating profit forecast from between Eu910m and Eu930m to between Eu870m and Eu890m.

This new target is based on a 3% growth in profits in the second half. But Accor's services business is delivering an 8% contribution to this growth while hotels are showing a decline of 5% in their profit contribution during the second half. The first half had delivered, across all businesses, an increase of 25% in profits.

France and Germany were likely to show more resilience in performance, said Accor's CFO Jacques Stern in a conference call with analysts, thanks to Accor's strong market share in the countries and the predominance of domestic business in those territories.

The forecasts were based on a macroeconomic view that there is going to be a downturn rather than on current booking patterns as bookings can be cancelled.

Stern added that the difference between now and what he called the last real recession between 1988 and 1992 is that there is much less supply. There was 4% to 5% annual increase back then but this time the supply increase in France has been less than 1% each year for the last three years.

The third quarter had seen Accor's casino performance badly affected (down 9.3%) but across the group revenue was up 4.1% on a like-for-like basis for the first nine months. Services were up 12.6% and hotels up 3.7%, although for the third quarter this growth was 1.1%, showing a marked deceleration.

Accor emphasised its strong financial position, with Eu1.4bn of unused and confirmed credit lines and no major refinancings (above Eu400m) before 2012.

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