While Europe’s largest hotel operator is struggling amid the global decline in travel, Accor also has $2.7 billion cash on hand. But it won’t use that money to bail out operators struggling through the coronavirus downturn.
Operations at 62 percent of Accor’s global hotel portfolio are suspended due to coronavirus. The French hotel company saw a 17 percent decline in revenue and a 25 percent drop in revenue per room, or RevPAR, in the first quarter. March was the weakest month of the quarter, but April and May are expected to be the worst months of the year due to uncertainty in when the global economy will reopen, according to Accor’s first-quarter earnings report out on Wednesday.
Consolidated RevPAR was down 25.4% overall in the quarter, including a 62.6% decline in March alone, after a 2.0% increase in January and a 10.2% decrease in February.
Accor CEO Sebastian Bazin acknowledged the company has a grim outlook for the year, but the company does not plan to divert from its asset-light shift in recent years to assist struggling operators of any Accor-flagged property.
Accor still has to account for a weak quarter and the uncertain year ahead for global travel. First-quarter revenue was down 17 percent to $831 million, and Accor expects a $184 million shortfall in earnings before interest, taxes, depreciation, and amortization — or EBITDA.
Read Original Article