ACRFF Accor SA Ltd (PK)

PARIS, October 16 /PRNewswire-FirstCall/ -- - Services Revenue up by a Strong 12.6% Over the First Nine Months Including 14.1% Growth in the Third Quarter - Hotels Revenue up 3.7% Over the First Nine Months Including 1.1% Growth in the Third Quarter - In Light of the Global Economic Downturn, Adjusted Full-Year Earnings Guidance: Profit Before Tax at Between EUR870m and EUR890m (vs. EUR910m and EUR930m Previously) - A Sound Financial Position Accor's consolidated revenue for the first nine months of 2008 totaled EUR5,787 million, up 4.1% like-for-like(1) over the same period of 2007 and down 5.4% on a reported basis. (in EUR millions) First 9 months First 9 % change % change 2007 months as reported like-for-like 2008 Hotels 4,389 4,329 -1.4% +3.7% Upscale and Midscale 2,442 2,569 +5.2% +4.7% Economy 1,244 1,306 +5.0% +4.5% Economy US 704 454 -35.6%* -1.2% Services 624 693 +11.0% +12.6% Other businesses 1,106 766 -30.7% +0.9% Total 6,119 5,787 -5.4% +4.1% * Including disposal of Red Roof Inn and EUR/$ currency effect (1) Like-for-like = based on a comparable scope of consolidation and at constant exchange rates The Group's revenue performance in the first nine months was shaped by the following factors: - Like-for-like growth of 4.1%. - The strategic refocusing on the Hotels and Services businesses (with the disposals of Red Roof Inn, Go Voyages and the Italian and Brazilian foodservices operations) and the continued deployment of the "asset-right" strategy, which together had a negative impact of EUR754 million or 12.3% on revenue for the period. - The expansion strategy which added EUR298 million or 4.9% to growth, including the effects of the full consolidation of Orbis in the third quarter of 2008. - A 2.1% negative currency effect resulting from the euro's appreciation against the dollar, the pound and most South American currencies. Services revenue up 12.6% like-for-like in the first nine months Revenue from the Services business in the first nine months increased by 11.0% as reported and 12.6% like-for-like. Acquisitions added 3.8% to growth. However, the currency effect was a negative 2.2%, mainly due to the weakness of Latin American currencies. Q3 2008: up 14.1% like-for-like Third quarter revenue growth was a strong 14.1% like-for-like, versus 11.8% in the first half. In Europe, revenue rose by 11.8% like-for-like, reflecting gains of 16.9% like-for-like in France, following the deployment of a special action plan to boost meal voucher sales, and 8.9% like-for-like in the United Kingdom. In Belgium, adjusted for the loss of the Onem contract, revenue was up 5.2%, compared to a decline of 23.3% like-for-like. In Latin America, like-for-like growth totalled 17.6%. Growth in Brazil accelerated to 17.5% in the third quarter, from 8.6% in the first half, while the other Latin American countries saw revenue rise an aggregate 17.6% like-for-like. This performance takes into account the 39.4% fall in revenue in Argentina in the third quarter following the withdrawal of payroll tax breaks. Excluding Argentina, revenue growth in Latin America came to 22%. Hotels revenue up 3.7% like-for-like in the first nine months Hotels revenue amounted to EUR4,329 million in the first nine months of 2008, down 1.4% as reported but up 3.7% like-for-like, including increases of 5.1% in the first half and 1.1% in the third quarter. Adjusted for the effects of the Rugby World Cup, which created a high basis of comparison in third-quarter 2007, like-for-like growth for the quarter came to 1.4%. The Hotels revenue performance in the first nine months was shaped by the following factors: - Like-for-like growth of 3.7%. - The sale of Red Roof Inn and other hotel units under the "asset-right" strategy, which had a negative impact of EUR291 million or 6.6% on revenue for the period. - The expansion strategy, added EUR182 million or 4.1% to growth, with the consolidation of Orbis in the third quarter adding EUR59 million (of which EUR51 million in the Upscale & Midscale Hotels segment and EUR8million in the Economy Hotels in Europe segment). - The currency effect, mainly due to the weakness of the dollar (1.7% unfavorable effect) and the pound (1.1% un favorable effect), which was a negative 2.6%. Upscale and Midscale Hotels 2008 YTD: up 4.7% like-for-like In Upscale and Midscale Hotels, revenue rose by 4.7% like-for-like in the first nine months of 2008. Q3 2008: up 1.8% like-for-like Third quarter growth was 1.8% like-for-like, compared with 6.2% in the first half, reflecting a more difficult economic environment. Adjusted for the effects of the Rugby World Cup, the growth rate was 2.4%. Revenue in France rose 1.0% excluding the effects of the Rugby World Cup. In Germany, revenue was up 2.2% like-for-like, with RevPAR climbing 4.8% in the third quarter. In the United Kingdom, revenue expanded by a strong 4.1% like-for-like, reflecting high activity levels in London where RevPAR rose 7.6% compared with a 0.2% increase in the regions. Economy Hotels (outside the United States) 2008 YTD: up 4.5% like-for-like In the Economy Hotels segment, revenue for the first nine months of 2008 rose 4.5% like-for-like. Q3 2008: up 1.7% like-for-like Business growth slowed in the third quarter, with revenue gaining 1.7% like-for-like compared with 6.1% in the first half. In France, revenue was up 1.8% like-for-like, led by the Ibis brand which reported 3.7% like-for-like revenue growth and a 7.0% increase in RevPAR for its Paris units. F1 revenues were adversely affected by the hotel renovation program, but nevertheless remained stable compared with the third quarter of 2007 despite the fact that 30 units are currently being renovated. In Germany, the performance of the Economy Hotels segment was dampened by renovation work at 13 hotels. Adjusted for these effects, revenues were up 1.3% like-for-like in the third quarter, versus an unadjusted decline of 0.2%. In the United Kingdom, revenue expanded 5.1%, helped by strong demand in London where Ibis hotels' RevPAR was 10% higher, compared with a 1.7% increase in the regions. Economy Hotels in the United States 2008 YTD: down 1.2% like-for-like Like-for-like Motel 6 revenue contracted by 1.2% in the first nine months of 2008, reflecting a challenging economic environment as well as higher gas prices. Q3 2008: down 2.7% like-for-like On a like-for-like basis, revenue contracted by 2.7% in the third quarter, after dipping 0.4% in the first half. The downturn stemmed from the unfavorable economic environment and extreme weather conditions, including the hurricanes that hit Texas and Ohio during the quarter. Franchise revenues were up 13.1%. Significant transactions and events of the period Accor has confirmed its commitment to expanding in Poland by raising its stake in the Orbis hotel group to 50% As part of its hotel development strategy in Central Europe, a market with very strong growth potential, Accor announced in early September that it had raised to 50.01% its holding in the Orbis group, which is listed on the Warsaw Stock Exchange. Accor, which had held 45.48% of the company since August 2007, recently acquired an additional 4.53% stake at a price of PLN 55.4 per share, representing an investment of approximately EUR35 million. Orbis, which earned net profit of EUR41 million on revenue of EUR307 million in 2007, has been fully consolidated with effect from July 1, 2008. In addition to hotels, the company also has operations in travel services, car rental, intercity bus services and casinos. It has a total of some 4,600 employees. Financial position and results Changes in scope of consolidation - Expansion In Services, acquisitions accounted for 3.8% of revenue growth for the first nine months of 2008, in line with the Group's medium-term objectives. In Hotels, expansion initiatives - including the opening of 19,450 rooms, of which 8,450 during the third quarter - boosted revenue for the nine-month period by 4.1%. - Acquisitions The consolidation of Orbis from July 1, 2008 added EUR109 million to consolidated revenue for the period. Currency effect The currency effect reduced revenue for the first nine months by 2.1%, or EUR126 million. The 8.6% fall in the dollar against the euro since the start of the year had a EUR64 million negative impact, while the euro's appreciation against the pound trimmed revenue by EUR50 million or 14.2%. Share buybacks Under the 22.5-million share buyback program approved by the Annual Shareholders' Meeting of May 13, 2008, a total of 812,699 shares were bought back during the first nine months of 2008, representing an investment of EUR33.6 million. Financing Accor has a sound financial position with a 24.2% FFO(1) / Adjusted net debt ratio as of June 30, 2008. The Group had EUR1.4 billion in unused confirmed credit lines as of end-September 2008. No major refinancing transactions are planned in the period to 2012. (1) FFO = Adjusted Fund From Ordinary Activities 2008 earnings objective The third quarter 2008 figures reflect the first signs of a real economic downturn. Given the unusual lack of visibility for the coming months, Accor is revising slightly its 2008 earnings guidance. The Group now expects profit before tax and non-recurring items to stand at between EUR870 million and EUR890 million (vs. EUR910 million to EUR930 million previously). This guidance of EUR870 million to EUR890 million would represent around 12% growth in profit before tax like-for-like1 for the year, of which 25% growth for the first half and a 3% growth for the second. In the current economic slowdown, Accor benefits from a sound financial position. By anticipation, the Group has already launched a EUR75 million cost savings plan, of which EUR50 million in 2009. The Group relies on its two-low cyclical businesses, Services and Economy hotels in Europe, which represent 67% of consolidated EBIT. The targeted second half profit before tax and non recurring items of around 3% like-for-like(1) reflects this resilience. Financial calendar - January 20, 2009: Fourth-quarter revenue release (1) excluding the impact of the return to shareholders Accor, a major global group and the European leader in hotels, as well as the global leader in services to corporate clients and public institutions, operates in nearly 100 countries with 150,000 employees. It offers to its clients over 40 years of expertise in two core businesses: - Hotels, with the Sofitel, Pullman, MGallery, Novotel, Mercure, Suitehotel, Ibis, all seasons, Etap Hotel, Formule 1 and Motel 6 brands, representing 4,000 hotels and nearly 500,000 rooms in 90 countries, as well as strategically related activities, such as Lenotre; - Services, with 30 million people in 40 countries benefiting from Accor Services products in employee and public benefits, rewards and loyalty, and expense management. Revenue Quarter 1 Quarter 2 Semester 1 in EUR 2007 2,008 2007 2,008 2007 2,008 thousand adjusted adjusted adjusted (1) (1) (1) HOTELS Up & 742,364 761,765 853,963 919,504 1,596,326 1,681,269 Midscale Economy 364,770 387,196 427,857 455,013 792,627 842,209 Economy US 215,940 137,255 245,286 149,573 461,227 286,827 Total HOTELS 1,323,074 1,286,216 1,527,106 1,524,089 2,850,180 2,810,305 SERVICES 206,984 226,635 210,783 232,372 417,767 459,007 Other Businesses Casinos 78,172 86,252 80,619 83,471 158,791 169,723 Restaurants(3) 151,766 100,937 164,521 32,605 316,287 133,543 On-board 59,704 69,461 70,568 78,795 130,272 148,256 train services Holding & 67,737 21,919 73,507 22,887 141,245 44,805 Other (4) TOTAL OTHER 357,380 278,569 389,216 217,758 746,595 496,327 BUSINESSES TOTAL 1,887,437 1,791,420 2,127,105 1,974,219 4,014,542 3,765,639 Quarter 1 Quarter 2 Semester 1 in EUR Change Change Change Change Change Change thousand reported L/L(2) reported L/L(2) reported L/L(2) HOTELS Up & 2.6% 3.9% 7.7% 8.2% 5.3% 6.2% Midscale Economy 6.1% 5.3% 6.3% 6.8% 6.3% 6.1% Economy US -36.4% 0.1% -39.0% -0.8% -37.8% -0.4% Total HOTELS -2.8% 3.7% -0.2% 6.3% -1.4% 5.1% SERVICES 9.5% 10.4% 10.2% 13.3% 9.9% 11.8% Other Businesses Casinos 10.3% 6.1% 3.5% -1.7% 6.9% 2.1% Restaurants(3) -33.5% 8.7% -80.2% -2.5% -57.8% 2.9% On-board 16.3% 8.5% 11.7% 1.0% 13.8% 4.4% train services Holding & -67.6% -4.3% -68.9% -0.7% -68.3% -2.4% Other (4) TOTAL OTHER -22.1% 5.6% -44.1% -1.4% -33.5% 2.0% BUSINESSES TOTAL -5.1% 4.8% -7.2% 5.6% -6.2% 5.2% Revenue Continued.... Quarter 3 September end (YTD) in EUR thousand 2007 adjusted 2,008 2007 2,008 (1) adjusted (1) HOTELS Up & Midscale 845,286 887,929 2,441,613 2,569,198 Economy 451,014 463,792 1,243,641 1,306,001 Economy US 242,971 166,729 704,198 453,557 Total HOTELS 1,539,272 1,518,451 4,389,452 4,328,757 SERVICES 206,261 233,571 624,028 692,578 Other Businesses Casinos 91,942 87,513 250,733 257,236 Restaurants (3) 147,666 24,792 463,954 158,334 On-board train services 75,109 82,804 205,381 231,059 Holding & Other (4) 44,401 74,383 185,646 119,189 TOTAL OTHER BUSINESSES 359,118 269,492 1,105,713 765,818 TOTAL 2,104,650 2,021,514 6,119,193 5,787,153 Quarter 3 September end (YTD) in EUR thousand Change Change Change Change reported L/L(2) reported L/L(2) HOTELS Up & Midscale 5.0% 1.8% 5.2% 4.7% Economy 2.8% 1.7% 5.0% 4.5% Economy US -31.4% -2.7% -35.6% -1.2% Total HOTELS -1.4% 1.1% -1.4% 3.7% SERVICES 13.2% 14.1% 11.0% 12.6% Other Businesses Casinos -4.8% -9.3% 2.6% -2.1% Restaurants (3) -83.2% 1.1% -65.9% 2.3% On-board train services 10.2% 1.6% 12.5% 3.4% Holding & Other (4) 67.5% 0.8% -35.8% -1.6% TOTAL OTHER BUSINESSES -25.0% -1.5% -30.7% 0.9% TOTAL -4.0% 1.9% -5.4% 4.1% (1) after reclassification of Timeshares in Asia from "Upscale and Midscale Hotels" to "Holding and Other" (2) at constant scope of consolidation and exchange rates (3) including the Italian and Brazilian food services businesses (4) including Go Voyages and Scapa Italia RevPAR by segment (Q3 2008) HOTELS : RevPAR by segment Q3 Occupancy Average room RevPAR Rate rate Sub- Sub- Sub- Sub- Sub- sidiaries sidiaries sidiaries sidiaries sidiaries (reported) (reported) (reported) (like-for- & managed (in %) (chg (chg (chg like(1)) (reported) in in %) in %) pts) Upscale 67.8 -3.8 101 +0.3% 68 -5.1% +0.1% -4.4% and Midscale Europe (in EUR) Economy 76.5 -3.7 57 +4.5% 44 -0.3% +1.0% -0.4% Europe (in EUR) Economy 69.8 -2.8 47 +0.0% 33 -3.8% -4.4% -3.8% US (in $) (1) at comparable scope of consolidation and exchange rates. RevPAR by segment (September YTD 2008) HOTELS : RevPAR by segment Q3 Occupancy Average room RevPAR Rate rate Sub- Sub- Sub- Sub- Sub- sidiaries sidiaries sidiaries sidiaries sidiaries (reported) (reported) (reported) (like-for- & managed (in %) (chg (chg (chg like(1)) (reported) in in %) in %) pts) Upscale 66.2 -1.1 105 +3.3% 70 +1.6% +3.8% +0.9% and Midscale Europe (in EUR) Economy 73.2 -1.4 57 +4.8% 42 +2.8% +3.7% +2.7% Europe (in EUR) Economy 66.3 -2.1 46 +0.9% 30 -2.2% -2.6% -2.2% US (in $) (1) at comparable scope of consolidation and exchange rates. RevPAR by country (Q3 2008) UPSCALE Number Occupancy Average room RevPAR AND of Rate rate MIDSCALE rooms Sub- Sub- Sub- Sub- Sub- HOTELS sidiaries sidiaries sidiaries sidiaries sidiaries RevPAR by (reported) (reported) (reported) (like- & managed country Q3 (in %) (chg (chg (chg for- (reported) (in local in in %) in %) like(1)) currency) pts) France 29,884 69.2 -2.3 113 +4.5% 78 +1.1% +0.4% +2.7% Germany 20,103 65.6 -1.7 94 +7.0% 62 +4.3% +4.8% +4.1% Nether- 4,005 67.8 -3.5 99 -1.3% 67 -6.1% -6.4% -10.8% lands Belgium 1,801 72.7 -3.1 99 +6.0% 72 +1.7% -2.6% +0.8% Spain 2,259 66.6 -1.8 90 -2.9% 60 -5.4% -5.4% -5.4% Italy 3,617 61.8 -2.3 122 -2.5% 75 -5.9% -1.9% -6.0% UK (in 5,226 81.7 +0.1 87 +5.5% 71 +5.5% +3.8% +3.7% GBP) USA 480 93.7 -2.1 258.0 +5.0% 242.0 +2.7% +2.7% +1.3% (in $) (1) at comparable scope of consolidation and excahange rates. ECONOMY Number Occupancy Average room RevPAR HOTELS of Rate rate RevPAR rooms Sub- Sub- Sub- Sub- Sub- by sidiaries sidiaries sidiaries sidiaries sidiaries country (reported) (reported) (reported) (like- & managed Q3 (in %) (chg (chg (chg for- (reported) (in local in in %) in %) like(1)) currency) pts) France 42,671 76.2 -3.0 51 +8.1% 39 +3.9% +2.6% +4.0% Germany 14,994 75.0 -2.5 58 +4.6% 44 +1.2% +1.0% +0.0% Nether- 2,209 76.7 -11.4 81 +3.1% 62 -10.2% -11.8% -10.2% lands Belgium 2,560 79.3 -3.7 65 +5.1% 52 +0.4% +0.4% +0.4% Spain 4,595 75.2 -8.1 56 +2.3% 42 -7.7% -5.9% -7.7% Italy 1,550 65.6 -2.0 70 -2.8% 46 -5.7% -7.2% -5.7% UK ( in 7,923 79.3 -3.4 56 +6.4% 45 +2.0% +5.5% +2.1% GBP) USA 79,678 69.8 -2.8 47 +0.0% 33 -3.8% -4.4% -3.8% (in $) (1) at comparable scope of consolidation and exchange rates. RevPAR by country (September YTD 2008) UPSCALE Number Occupancy Average room RevPAR AND of Rate rate MIDSCALE rooms Sub- Sub- Sub- Sub- Sub- HOTELS sidiaries sidiaries sidiaries sidiaries sidiaries RevPAR by (reported) (reported) (reported) (like- & managed country (in %) (chg (chg (chg for- (reported) Sept YTD in in %) in %) like(1)) 2008 pts) (in local currency) France 29,703 67.4 +0.3 115 +5.9% 78 +6.4% +5.2% +5.5% Germany 20,222 63.7 -0.7 96 +6.4% 61 +5.2% +5.2% +5.1% Nether- 3,983 67.1 -1.9 108 +3.6% 73 +0.7% +0.7% -3.8% lands Belgium 1,802 70.9 -0.4 108 +7.8% 77 +7.2% +1.7% +6.2% Spain 2,259 65.0 -2.0 100 +0.8% 65 -2.1% -2.1% -2.1% Italy 3,454 59.1 -3.7 118 -0.2% 70 -6.1% -2.8% -5.9% UK ( in 5,229 78.6 +0.3 89 +5.9% 70 +6.3% +4.6% +1.9% GBP) USA 480 94.0 +2.2 242.0 +7.5% 228.0 +10.0% +4.2% +5.4% (in $) (1) at comparable scope of consolidation and exchange rates. ECONOMY Number Occupancy Average room RevPAR HOTELS of Rate rate RevPAR rooms Sub- Sub- Sub- Sub- Sub- by sidiaries sidiaries sidiaries sidiaries sidiaries country (reported) (reported) (reported) (like- & managed Sept YTD (in %) (chg (chg (chg for- (reported) 2008 in in %) in %) like(1)) (in local pts) currency) France 43,233 73.2 -1.2 51 +7.2% 37 +5.5% +4.2% +5.6% Germany 15,060 70.6 -1.1 59 +5.0% 42 +3.4% +3.4% +2.3% Nether- 2,171 76.2 -7.5 83 +7.0% 63 -2.6% -4.4% -2.6% lands Belgium 2,560 77.4 +0.1 69 +6.4% 53 +6.6% +6.3% +6.6% Spain 4,457 73.6 -5.4 57 +4.3% 42 -2.8% -2.6% -2.8% Italy 1,550 63.0 -1.0 74 +1.3% 47 -0.3% +0.1% -0.3% UK ( in 7,743 76.4 -0.9 56 +6.3% 43 +5.1% +6.8% +5.1% GBP) USA 79,886 66.3 -2.1 46 +0.9% 30 -2.2% -2.6% -2.2% (in $) (1) at comparable scope of consolidation and exchange rates. DATASOURCE: Accor CONTACT: Media Contacts: Emmanuelle Baumgartner, Senior Vice President Media Relations Department, Phone: +33-1-45-38-84-77; Alain Delrieu, Senior Media Relations Officer, Phone: +33-1-45-38-84-85. Investor Relations: Eliane Rouyer-Chevalier, Senior Vice President, Investor Relations and Financial Communication, Phone: +33-1-45-38-86-26; Solene Zammito, Deputy Director, Investor Relations, Phone: +33-1-45-38-8633.

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