This rebound, says Accor, reflects both the recovery of the number of business and leisure domestic guests, and border reopenings which accelerated the return of international travellers. It was also accompanied by a sharp increase in prices, driven by demand and emphasised by inflation.
During 1H 2022, Accor opened 85 hotels, representing 11,700 rooms, a net system growth of +1.8% in the last 12 months. At the end of Jun-2022, the Group had a hotel portfolio of 777,945 rooms (5,300 hotels) and a pipeline of 212,000 rooms (1,215 hotels).
Room revenue exceeded 2019 levels in 2Q 2022
The improved performance in 2Q 2022 meant consolidated revenue per available room (RevPAR) was actually up +1% on 2Q 2019, but the Omicron influenced 1Q 2022 performance meant 1H 2022 levels were still down -11% versus the same period in 2019.
These figures reflect a month-after-month sequential improvement in business with a sharp increase in prices. "Activity reached levels close to, or even higher than 2019 levels in almost all of our regions in the second quarter," says Accor.
Regional variations, but a general positive trend
In 2Q 2022, Accor's RevPAR in South Europe was +2% above the 2Q 2019 level. In France, 2Q 2022 RevPAR was +3% above the 2Q 2019 level. The recovery of international travellers helped Paris to close the gap with province, both now above 2019 level in 2Q. Prices were higher than those of the same period in 2019, thanks to a favourable combination of public events in May (UEFA Champions League Final, Roland-Garros Tournament), says Accor.. In Spain, RevPAR was up +2% in 2Q 2022 versus 2Q 2019.
In 2Q 2022, RevPAR in North Europe was down -7% versus 2Q 2019, but business for Accor improved sequentially month after month. In the United Kingdom, the strength of the recovery was comparable to that seen in France. Both London and the province recovered to RevPAR levels above those of 2Q 2019. In Germany, which took longer to lift its health restrictions, business for Accor recovered at a slower pace. Nevertheless, in Jun-2022, the country's RevPAR performance came close to the levels recorded in neighbouring countries.
In the India, Middle East, Africa & Turkey region, Accor's rebound in RevPAR, which exceeded 2019 level (+32% in 2Q 2022), was confirmed for a third consecutive quarter. The United Arab Emirates continued to outperform after a strong 1Q boosted by the world Expo 2020. Meanwhile, in Saudi Arabia, the broader reopening of the holy cities for pilgrimages has led to a sharp rebound in activity, particularly during the Apr-2022 Ramadan period. This recovery is also expected to continue with the Hajj in Jul-2022, predicts Accor.
In the Americas, 2Q 2022 RevPAR was +5% higher than in 2Q 2019. In North/Central America and the Caribbean, RevPAR was in line with 2019 levels in 2Q 2022, driven by a sharp increase in prices. In South America, and particularly Brazil, the pick-up in business volumes was notably impressive, with occupancy rates above the 2019 level throughout 2Q 2022.
Asia Pacific rebounds, but China and South East Asia remain laggards
RevPAR has continued to improve sequentially in Asia-Pacific (+25 percentage points between 1Q 2022 and 2Q 2022). It was down -18% in 2Q 2022 versus 2Q 2019. The Pacific confirmed the recovery already seen in 1Q 2022 and ended the second quarter up +9% versus 2Q 2019. The reopening of internal and external borders since the end of 2021 accelerated this recovery.
China saw a slight month-after-month pick-up in business in 2Q 2022. However, the restrictions implemented as part of the strict enforcement of its "zero-Covid" policy adversely affected its performance and resulted in a -38% decline in RevPAR versus 2Q 2019.
In South East Asia, Accor's RevPAR was down -31% in 2Q 2022 versus 2Q 2019. Although the main travel restrictions have been lifted, the region's dependence on Chinese visitors had an adverse impact on the recovery speed, notes Accor.
Future structure to be based on two distinct business divisions
From 01-Oct-2022, Accor will leverage two business divisions comprising separate and distinctive expertise with the aim of further strengthening the excellence of each of these business lines, improving their operational and financial performance and offering their owners and guests ever more relevant products and services.
These will comprise the 'Economy, Midscale & Premium Division', comprising notably the Group's brands ibis, Novotel, Mercure, Swissôtel, Mövenpick and Pullman, covering 4,816 hotels worldwide and 948 new properties in development; and the 'Luxury & Lifestyle Division', bringing together Accor's luxury brands as well as the Group's lifestyle entity, Ennismore, and covering 488 hotels globally and 266 new properties in development.
The 'Economy, Midscale & Premium Division' will incorporate leadership positions in Europe, Latin America, Asia-Pacific and the Middle East, and will be structured around four regional headquarters based in Paris, Sao Paulo, Singapore and Shanghai. It will focus its strategy on accelerating its development through franchises, the rejuvenation of its brands and the industrialisation of its operating model.
The 'Economy, Midscale & Premium Division', focused on Luxury and Lifestyle, will be structured by brand around four pillars: Raffles & Orient Express, Fairmont, Sofitel & MGallery, and Ennismore. It will be committed to strengthening the identities of its iconic brands, investing in top talents, selecting the best locations and offering unique and innovative experiences.
Accor enters into exclusive negotiations to sell Ennismore stake
Details of the restructuring follows the recent news that Accor has entered into exclusive negotiations to sell a 10.8% stake in Ennismore for EUR185 million to a consortium of investors with financing from Qatar First Bank.
Ennismore today comprises a unique collective of world leading lifestyle brands including 21c Museum Hotel, 25hours Hotels, Delano, Gleneagles, Hyde, JO&JOE, Mama Shelter, Mondrian, Morgans Originals, SLS, SO/, The Hoxton, TRIBE and Working From_. The combined Ennismore group consists of over 130 hotels operating in nearly 40 countries, with over 275 F&B venues.