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AccorHotels eyes recovery in France as revenue jumps
The logo of French hotel operator AccorHotels is seen on top of the company's headquarters in Issy-les-Moulineaux near Paris, France April 22, 2016. REUTERS/Gonzalo Fuentes

AccorHotels eyes recovery in France as revenue jumps

PARIS: AccorHotels, Europe’s biggest hotel group, flagged signs of a turnaround in its French home market with a jump in first-quarter occupancy rates while brisk business in Germany and Britain also helped to lift revenue.

The French company, which operates high-end chains such as Raffles and Sofitel as well as budget brands such as Ibis, has been restructuring, partly in an effort to see off competition from flat-sharing websites such as Airbnb.

AccorHotels said first-quarter revenue rose 35 percent year on year to 425 million euros ($456.8 million). That represented a 7.4 percent like-for-like increase, stripping out acquisitions and currency effects, against a 3.1 percent rise in the previous three months.

Robust growth in Europe and Asia helped to counter a tough quarter in Brazil, where the economy is still reeling from recession and hotel chains are grappling with an overcapacity problem now last year’s Olympic Games in Rio is a fading memory.

Like-for-like revenue was still down slightly in France and Switzerland.

The tourism industry in AccorHotel’s home market, one of its biggest earnings drivers, slowed after a series of deadly attacks, but CFO Jean-Jacques Morin told a conference call that there are signs of an “inflection point” in France as hotel occupancy begins to improve again, particularly in Paris.

AccorHotels, which runs more than 4,000 hotels worldwide, has been cutting costs, expanding in the luxury end of the market and investing in new areas such as concierge services.

It also plans to sell a majority stake in its AccorInvest property unit, which has assets worth 6.6 billion euros, with Morin saying that talks are already under way with French and international investors.

Shares in AccorHotels closed slightly higher on Thursday before the results were released, up 0.8 percent at 39.50 euros.