3. What:
• World’s leading hotel operator
• Market leader in Europe
Where:
• 92 countries
Who:
• Sofitel, Pullman, MGallery, Grand Mercure, Novotel,
Suite Novotel, Mercure, Adagio, ibis, ibis Styles, ibis
budget and hotelF1
From luxury to economy
4. Milestones
1967
SIEH (Société d’Investissment et d’Exploitation Hotelier)
70’s-80’s Hotel operations in Brazil, Mexico, USA
90’s World’s leading hotel group
Market leader in the Asia-Pacific region
2000’s
• Launch of accorhotels.com
• Chinese hotel market
• New property managment strategy
• Governance system from a Supervisory Board and
Management Board to a Board of Directors
5. Vision and mission
• Innovation is our trademark
• Performance is the key to our continued
success
• Respect is basis of all our relationships
• Trust is the foundation of our
management
6.
7.
8.
9. Ongoing Projects
Accor is currently implementing 4 major projects aiming to improve results
1) IBIS Megabrand
2) TARS System (booking platform)
3) Expansion
• 38.085 new rooms in 2012
• 70% in Emerging Markets
• 50% are IBIS
• 85% asset-light
4) Asset Management Program
10. Asset management
strategy
• Management of owned hotels
• 200 hotels sold - € 1.3 billion positive impact on consolidated
adjusted net debt as of 2016.
• Management of leased hotels: 600 hotels
• Will improve consolidated operating margin.
11.
12. Accor income
statement 2010-2012
amounts in € millions
CONSOLIDATED INCOME STATEMENT ACCOR 2010 2011 2012
1 Total Revenues 5,948 6,100 5,649
2 Operating expenses* -4,134 -4,177 -3,861
3 Contribution Margin (1-2) 1,814 1,923 1,788
4 Rental Expenses -934 -995 -938
5 EBITDA (3-4) 880 928 850
6 Amortization and depreciation -434 -398 -324
7 EBIT (5-6) 446 530 526
8 Total net financial expenses -112 -92 -58
9 Income before tax and extraordinary items (7-8) 334 438 468
10 +/- Non recurring items -346 -112 -229
11 Income before tax (9-10) -12 326 239
12 Income tax expenses -392 -274 -143
13 Net Income for continuing operations (11-12) -404 52 95
14 Profit or loss for descontinued operations 4,014 -2 -679
15 Net Income (13-14) 3,610 50 -584
* Operating expenses include variable and fixed costs
13. Revenue Trends
5.948
6.100
5.649
5.000
5.500
6.000
6.500
2010 2011 2012
in€million
Accor
Total Revenues
2010 2011 2012
Revenues
+7.1
+5.2
+2.7%
•IS shows relatively stable revenues over the period 2010 to 2012
•Excluding the effects of disposals, asset-right strategy and currency exchange the
Revenues have increased by 15% over the period
•Expansion:
•2010 - €76 mi (1.4% ) – opening of 214 hotels / 25.000 rooms
•2011 - €108 mi (1.8% ) – opening of 318 hotels / 38.700 rooms
•2012 - € 154 mi (2.8% ) - 266 hotels / 38.085 rooms
14. Cost structure
-
500
1.000
1.500
2.000
2.500
3.000
3.500
4.000
4.500
2010 2011 2012
Accor Cost Structure
Other operating expenses
Taxes, insurance and
service charges
Energy, maintanance and
repairs
Employees benefits
expense
Cost of Goods Sold
•Salaries are the main component of the cost structure
•Structure has not changed over the period
•Energy, maintenance and repairs are low mainly due to the very efficient Accor
policy on sustainability (Planet 21)
15. Role of operating
activity on Net Income
•Operating expenses take up to about 85% of the revenues
• Impact of operating expenses on Net Profit is very high, in line with the
industry
•Accor doing a great job in managing these costs
•25% franchising
•Cutting energy costs (Planet 21)
•Efficient management
-
1.000
2.000
3.000
4.000
5.000
6.000
7.000
2010 2011 2012
Impact of operating expenses on Net Income
Revenues allocated to
other costs
Revenues allocated to
cover operating
expenses
16. EBIT Trend
0
200
400
600
800
1.000
2010 2011 2012
in€million
Accor
EBIT
•EBIT increased by 18% over the period 2010 to 2012,
mainly in 2011 due to increase in revenues and decrease in
amortization and depreciation
•Consequences of the asset-right structure
17. Role of non-operating
activities on Net Income
-1.000
0
1.000
2.000
3.000
4.000
5.000
6.000
7.000
8.000
2010 2011 2012
Accor
Revenues distribution Net Income
Net Income for continuing
operations
Income before tax
Income before tax and
extraordinary items
EBIT
EBITDA
Contribution Margin
•Non-operating activities are not relevant for the Net Income
•In 2010, an extraordinary fact added € 4 billion to Net Income.
This was the result of the demerge of Edenred (Prepaid Services).
18. Net Income Trend
-600
-400
-200
0
200
2010 2011 2012
in€million
Accor
Net Income
(excluding discontinued business)
-1.000
0
1.000
2.000
3.000
4.000
2010 2011 2012
in€million
Accor
Net Income
•Looking at the real Net Income (excluding the descontinued business), there was
an improvement
•Increase in revenues
•Decrease in operating expenses
•Decrease in depreciation and amortization
19. Accor Balance Sheet
2010 - 2012
amounts in € millions
CONSOLIDATED BALANCE SHEET ACCOR 2010 2011 2012
1a Quick assets 1,143 1,370 1,878
1b Inventory 41 41 47
1c Current assets 1,367 1,312 1,151
1 Total Current Assets 2,551 2,723 3,076
2 Tangible fixed assets 3,682 3,257 2,592
3 Intangible fixed assets 1,152 1,085 1,104
4 Financial fixed assets 480 549 632
Assets held for sale 813 386 156
5 Total fixed assets 6,127 5,277 4,484
6 Total net assets 8,678 8,000 7,560
7 Current Liabilities (financial and non-financial) 2,336 2,293 2,736
8 Long-term Liabilities (financial and non-financial) 2,393 1,939 1,835
9 Total liabilities 4,729 4,232 4,571
10 Shareholders' equity 3,949 3,768 2,989
11 Total liabilities & Shareholders' equity 8,678 8,000 7,560
20. Assets Structure
•Majority of the assets composed by tangible fixed assets (common in this
sector) – land, property and equipment
•Fast and steady increase in quick assets
•Financial assets are not so relevant
13,17% 17,13%
24,84%
15,75%
16,40%
15,22%
42,41%
40,71%
34,29%
13,27%
13,56% 14,60%
5,53%
6,86% 8,36%9,40% 4,83% 2,06%
2010 2011 2012
Structure of the assets section
Assets held for sale
Financial fixed assets
Intangible fixed assets
Tangible fixed assets
Current assets
Inventory
Quick assets
21. Liabilities and Social
Equity structure
0%
20%
40%
60%
80%
100%
2010 2011 2012
Liability & Equity Structure
as % of Total
Current Liabilities
Non-Current Liabilities
Shareholders' Equity And Minority
Interests
•Well distributed – however equity is lower than total debt
•Current liability increased over the period
•Equity decrease over the period
•Mainly due to short term debt and finance lease – result of the
strategy of switching from owned to lease or management
22. Liabilities nature
•Loans (short and long terms) together account for 51% of the
liabilities
•65% the debt: long-term (mainly 2 years and 5 years)
•35% of the debt: short-term loans
•loans in several different currencies, all hedged by mainly by
swaps
•Other payables account for 25% of the liabilities and are mainly
salaries and taxes
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2010 2011 2012
Liability composition
Liabilities of assets classified as held for
sale
Long-term finance lease liabilities
Deferred tax liabilities
Provisions
Trade payables
Other payables and income tax payable
Short-term debt and fin lease plus
overdrafts
Other long-term financial debt
23. Shareholders’ Equity
Trends
35%
40%
45%
50%
2010 2011 2012
Equity in relation to Total
Liabilities & Equity
•The percentage represented by Equity in the Total Liability &
Shareholders’Equity decreased over the period
• Decrease in the Reserves
-
500
1.000
1.500
2.000
2.500
3.000
3.500
4.000
2010 2011 2012
in€million
Equity composition
Additional paid-in
capital and reserves
Share Capital
26. Accor Financial Ratios
•Current ratio shows that Accor has no liquidity issues, current assets cover
current liabilities
•Equity ratio shows that around 60% of Assets are financed by Debt and 40% by
Equity. The ratio increased over the period, following the already mentioned
decrease in Equity
•ROS remained stable over the period and is in line with sector, caused by
increase in EBIT and also in Revenues
•Reported ROE is very good in 2010 and then it deteriorates in the next 2 years.
•Reason: in 2010 Edenred was demerged, causing a very large profit.
•Excluding the effect of demerging, ROE is actually not that good, showing
that Assets are financed more by debt than by Equity
•However, when compared to main competitor, picture looks a lot better
for Accor
27. Conclusions
• Accor is a very solid group, with a balanced financial structure, good
liquidity, even if level of debt is high in absolute terms (low when
compared to market practice in this sector)
•Company strategy of shifting to light-asset structures (Asset-right
Strategy) seems to be paying off, leading to lower costs and consequently
higher income, expected to be more visable in the future, when strategy
goals are fully met
•In the period analyzed, Accor managed to achieve the objetives defined
by management, keeping in place the Investment Grade rating (BBB-)
•Focus on core business and on becoming global reference in the Hospitality
Industry
•Sustained and active deploiment of the Asset Management program
•Record expansion
•€ 150 mi in free cash flow
•Improvement in ratios and margins
•€ 526 mi in EBIT
•52.6% EBITDAR margin on management and franchise contracts
28. Suggestions
•Keep working on the asset-light strategy
•Increase investments on Planet 21 – aiming at becoming
“Reference in Sustainability”
•Since Accor is active in all segments, with too many brands,
customers find it difficult to relate to the ACCOR brand. We
suggest more investments in Institutional Marketing in order
to create aknowledgement of the institutional brand.