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Weak Asia weighs on Accor Q1 hotel room revenue growth
[PARIS] Accor, Europe's biggest hotel group, said on Thursday weakness in Asia and in North America held back growth in revenue per available room (RevPAR), a key gauge of performance for the hotel industry, to 1.6 per cent in the first quarter.
The French company, with more than 4,000 hotels ranging from luxury Sofitels to the budget Ibis brand, however said it was confident RevPAR would progressively improve to around 3 per cent for the full year 2019 as it expected Asia to recover.
Accor said first quarter revenue rose 8.8 per cent on a like-for-like basis to 987 million euros (S$1.51 billion) as Europe remained strong while South America confirmed its recovery.
RevPAR in the Asia Pacific region contracted 0.6 per cent in the quarter, led by a 1.6 per cent fall in Australia, where oversupply in major cities and upcoming general elections affected prices and occupancy rates.
There was also weakness in Chinese outbound travel to Thailand, Vietnam, Malaysia and Australia. RevPAR in China alone fell three per cent in the quarter.
The revenue per available room in North America suffered from unfavourable comparisons with the first quarter 2018 in the United States while renovations hurt activity in Canada in the first quarter of 2019.
Accor has been cutting costs, expanding in the luxury end of the market and investing in new areas such as concierge services to boost growth and fight the rising challenges posed by companies such as Airbnb and online travel agents.
In February it said it would invest 225 million euros over the coming years to support new initiatives to boost its presence in hospitality and entertainment services.