ACRFF - Earnings call transcript Q2 2021

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Operator

Hello and welcome to the Accor 2021 Half Year Results Call. My name is Jess [ph] and I'll be your coordinator for today's event. [Operator Instructions] I will now hand you over to your host, Sébastien Bazin, Chairman and CEO of Accor to begin today's call. Thank you.

Sébastien Bazin

Thank you very much. everyone. morning, Good

for I'm are next semi-annual numbers reporting me. Here to the be Accor. right. my happy is is with for He we on HX you. to Jean-Jacques

factual. good start let's and be on context says to X, a is on What So, positive three have you things have of conversation course which recovery page super this page.

countries last XX% of certainly partially number better to we wished It our of stood the XX%. It's of or on where than is that below XX left. year case actually as the course June closed. The is yet. first, I on closed today number were all would not way where That be XX%. have

muddy different navigating water in So still we're terms countries different a through rules. in a of and of bit

of have However, very and certainly what you the interesting in page very, positive. is that middle

haven't We April. should the February months here January, of we shown you have and

minus You at do see April here XX%.

prior the If you number. really was months exact for were two to to the that looking XX%, XX% this,

and the noticeable we've for row, last even months to the three sure probably XXX the for for August. point that a likely be case is by better and improving in basis month RevPAR been of it exactly maybe So

to in many a vaccine data question of recovery due we presents months rollout momentum no opening of So, of countries and progressive borders it positive the in four operate terms undoubtedly, and, terms is the rebound, in for many last in. the

Again, XX% to sign out. vaccines and next light the of weeks in certainly think being the is positive correlated a ahead. months next there light of efficiencies rolled very and So the few few I

people a the going have have it and right and you is we on are Delta you messy. through certainly still Northern depending be you vaccination there it But helps page not still clearly the South could America, side you countries what in in whether of of the is should is Whether it call variants Gamma addressing. do Europe, homogeneous certainly on numbers hospital. However,

shouldn't which of activities. What an on day, to of is it obviously there be coming last morning still, the So with have we every unfortunately, European year know a and impairing of did different being quarantine exception why the lot that eliminating to to as notable on that UK have quite England is. for really you from again, France, is, us depending for announcement customers, our markets. we was Union I But to see have domestic on the members this which conduct bit still that faced we a don't and rules adapt why we explain a are

activities. for months. the and domestic due being three the months vertical market. now the here pace three the on to happen been Page you still still The upper largest recovering mid-August. The X third The from China, but being is, stronger depending with horizontal of you've of and two rebounding and last of it huge domestic seen closed both the hope is is in province, on the rebound market quite certainly is But us now have last market Australia see quite clearly a just because is page was one will you recovery. and for terms matter and back. bit being Clearly, sector the I no a US size a not as on travel which and they them quite of matters, reopening China the that resilient event impacted which pretty on page XX% performances in sea weeks different US markets, as point question, before of it's fast is one and of is benefiting the closing the in No The X. two axis. see we on too be the weight USA give down also surprise, by you would Sydney board clientele. but had come helpful, hospitality that helpful rebound have to is right.

ago, fast like You that the and on the UK, to if season is we've the countries have matter. learn Thailand, to certainly from And in of Europe, of any and in Germany and through [ph]. That's where it middle mid-sure and is Asia, seen whether Vietnam, benefiting France, the is better rolling for rebound a from we America, for surprise. for those from a for page than see certainly market. it in clearly weeks expected let's certainly ready went you actually market. difficult the for we've international be eclectic and rebound surprise, summer we weeks delayed Bad Brazil in big a for which we Brazil certainly rebound market to It no the and net have Argentina. dose. helpful rollout from in still only the in very see from are. Vaccine very seven the news, out China, is of all every we rebound depending vaccination last from very, terms hospitality first Australia, Very, South plus XX% XX%, domestic travelers in learn very Southeast certainly, fight patient XX% Korea, Cambodia, some but we places in

So now, to Jean-Jacques, you.

Jean-Jacques Morin

Okay.

avoids i.e. just clarity, to afternoon with you provide everybody. of word it and to sake XXXX, versus am So, we be to will makes very Sébastien. as continued good comparison do we much the to easier valuation base morning, introduction, in RevPAR thank that today. I Good we've And the you you, as of a happy QX, for effects. did

presentation XXXX valuation when As provide per will it revenue and we EBITDA and figures, in the is XXXX versus relevant. the

ratio the when So sense. makes

move the delay, got you've first where without six highlights left X to further the on So page part. the months let's of

XX% of X% The versus environment is months million, organic heterogeneous micro a lot and I'll of i.e. translate did as X.X% the semester of Sébastien versus introduced. on that last RevPAR versus XX XX% tune here net decrease was down see like-for-like geography of at system of into challenging you €X.XX a that the was basis. detail So performances XXXX. of growth group more later that effects 'XX to on. across revenue figure HX 'XX but HX underlying The the other

to to per control On million the we both cost target achieve guided strong that towards. trend the guidance on given add you plus to in an and million. we we will cash cash very the €XX the sensitivity burn and plan Fixed monthly i.e. on line. for we full the you context, year, had are back below by an million do had below you confirm high keep average monthly And in we comforted business. -- in part of on EBITDA result sensitivity €XX we see the as did numbers actual that Well and that the and February, burn well EBITDA a RevPAR operational EBITDA €XX

the to we we are refresh page, back next move RESET. put what to slide that RESET everybody is you If and on where

with EBITDA staff, The at non-staff. XX% on and and of will No part by done effect of the level. line So XXXX €XXX will the change bottom is we the left it. the the we million to be EBITDA RESET, nature XX% here, exit you the see effect saving

deals legal fundamentally of are. is little to with the one staff, Just the in was jurisdiction reason and a the bit staff is plans the process -- the All departure which through, that QX. to the which it what when you go you completed July is The for what largest it. by latest start France, time give differences depending in will is got XXXX you've and on non-European

amount you Europe. would the you over formal plan structure, we've but the The work to So end-to-end bit eliminated things that if in does reorganization That's done got table see management process. easier a you the on of do little diminished. has are Asia lean and XXXX. And to which it's analyze as all make it less out have also possible we've months downwards of task Pacific, what with we as plus six a that the sure XXXX in reflects that been now reflects much layers, or more significant tasks here a who when

here the of to just more competencies. plan of a than internal expensive cloud, all and the IT time the dependency of towards give you elements XX% application, reduction color. employees which over are The commissioning cleared migration see You contractor, term in of

that also have marketing of a to some We of bit. optimized everybody. life to so is the one effort simplifies management that's significant get That's [indiscernible] unified business why that reset and contract there

since with acceleration of explained start which and Now, Europe, April translation an star of we of to I as very if vaccination. and what we other of we high improvements, classical as which relaxation part is XX% by that the the quarter, the and restriction it see of the Overall, am review is XX% second we also July When the of which is we just the is the more marked importantly see evolution on numbers page Sébastien and very X. higher about move rate clearly confirming. do, down

part on of now very a are double-vaccination XX% We in Europe. large above

The South So, but lockdown France XX obviously improved RevPAR minus didn't in with XX%. in Europe starting April help points.

April driven XX% between So and June.

limited. significant way, is July fourth the very increase the very here. of the by effect today, So wave

a any don't we can of significance, So is question see any you which yourself. ask cancellation

no that Europe, minus XX%. importantly, all Two so province and very picture and good UK is driven travel mid-July similar got the situation XX% In the and the and residents, part the for vaccinated there June here. by is North If in is is very here globally and is improvement you've different relaxation you know Germany. free to to of April business. large event a got restriction business move since The They there delayed of France news quarantine Germany, helps you as between three the British different. business that

XX%. Asia-Pacific, shows to here picture. But while marked minus a RevPAR to a heterogeneous you improvement very again If move the down

and which test are can XX% got get the players bar Pacific and You've respectively minus good they are of China [ph] XX%.

been are regions that to the there to performance compared XX,XXX the Europe well But enough few would significant has and Melbourne, in day. when about cases, i.e. So, QX. Both and and XXX sanitary controlled that France, about cases in the Sydney above for talk to pattern, they To what quoted see I have will market we affect this say improvement. basically Australia fact situations. we is were domestic decide per very got cases Pacific, for shutdown talk large cases be same we in

XX%, to Moving here from RevPAR is the is lagging and international is at business Asia XX% in vaccination Asia, of coming and Southeast minus Southeast clearly travel.

good, just Middle in numbers effect export and So When quarter QX. further move XXXX has RevPAR business the India, for with the it you you've and should Dubai doing border here. been like is got and be direct XX%. to opened last a Africa to a the catalyst has been down good doing East, restaurant

is If will other start pilgrimage you What is were will teaming June that to and what be to on and to the the which that our [ph] is which has go of hand, is mid-August. been they pilgrimage Saudi, and stopped where didn't able so to communicated order move they in there in help staffed plan. need the business large cities so the be part you permits, holy permits the

a that's positive. again So

move to different picture. a very you Again, If here, America.

borders been very a plagued, The US, by news the Canadian, again Canada Rockies, the months on got from do good our Canada You've on hand, US is the and between mid-August, of -- the after very, has other that Americans sorry, improving notably over we months being business, reopen HX. spending real the lot and and restriction results. is in should very very, here a in stringent fact, steadily time -- which

for RevPAR. much so Now, the

over rooms the than growth growth; about Moving less QX 'XX opened and here is system We than months. last our which by sorry, HX, year picture XX,XXX of see -- system X.X% the the XX%, which last net is to XX%. of overall of XX our HX net you at better

Again, more is The where cost not this we here. in are pace on surprise there So to like cautiously the than Overall, but monitoring is than subdued as real owners Southeast of be. and more is the see we places used somewhat HX, the seen opening, of pandemic than are is true extremely HX saw to which recovered have but XX% opening Asia. activity a openings the overall no we again situation. -- rebound being over bit of historically, we postponed tune the is and we less we which translation historically what the what 'XX

us guidance drive to probably X% we Some to had this -- February. growth you back range of be to under that control. in The will remain in given net low the X% the system

development. very couple been far There with China no as [indiscernible] more words are opened of performance. is doing se which on good. care of XX% we consistent a about is change. Just five much consolation very 'XX, in of as mean of again consistent openings, year's historical at conversions. I per Again, HX And level. no home conversion, spike The the with last

in what with We before are now is performance. in the I'm revenue. line foreseen moving had next with which history to we as dealing page,

and I on am You've XX. got the by page revenue segment

effect, I've here, variance the at [ph] revenue see got of and preferred nothing between significance. million, You the like-for-like currency €XXX the but here

growth XX% hotel revenue we down to is again the mentioned. service, RevPAR If with fully which XX%, had you is line in that move

and is reflect a that Asia XX% the the you've no we've more, again only little far by in is business is growth down the a on places [indiscernible] bit are as US the group which like owner sharper I'll US but concerned, go Pacific, you in surprise late Pacific lesser which compared here, it as and the got salaries the doing good at where down to to revenue Again, and M&F stronger average. activity Asia got XX%. the If and detail Australia. declines

and last If service Other. is is, the like-for-like you fact, hotel which This move than Hotel to to XX% thanks better Asset doing on Australia. and a in basis minus segment segment is this

QX over HX, just holiday and itself goal essential did at destination head leisure in confirm cost. i.e. what the saw and we demand So like

more as we businesses, travel business, part and services report, could upon and in been was as new expect So country close in is see anticipated. much digital the essentially our than, services current in far territory taking which a have related that Other, within in we Australia travel much digital in services, the Asset better. would people line as in fact, And what Hotel that have than vacation of related are you with a the

'XX, HX If increase. you by see M&F the effect you see overall distraction. an in the typically the revenue 'XX It's interesting XX%, is, M&F RevPAR is by you HX that drill look would the down contract. now management the versus decreased we XX%. when like you at note It's do, on of What incentive it,

former Pacific, incentives in to they that 'XX are You significantly are triggered in translates where in see HX Australia, XX% Dubai. increase and situation the triggered, drop they HX are again, fact to back notably and Asia that in in 'XX, coming up back notably

that's you've M&F the of HX that like-for-like 'XX so got And basis increase 'XX. why, and on in fact, HX between

back. that flow So comes things a when good sign obviously, very incentives back,

number that about the XX%. improved Now, minus by be the €XXX that see sort million, of you EBITDA look about same all reflects revenue, in you if which been €XXX so go EBITDA the all, if to EBITDA debt into the but response, operational net precise. you upgrade about million, talking I I've is mean, before. The

resulted is that in of sensitivity, slightly a €XX so million point RevPAR. EBITDA per which And below good

success had So you is the below the to guidance right provided we the one. on fact the guidance that come that

been like that a the EBITDA that Now, we people Australia. behave anticipated an There that? how and Australian that's shows so good would not behaving, is has do had up been explain and is have effect clearly they in surprise which We sensitivity. the

those good is good are The there Middle here, in some incentive. in notably Australia. other incentives East notably the and thing Africa, are Again, and incentives

debt in again year. debt was, semester that's versus to no this last so positive bad call and fact, And there --

it. what you and last you RevPAR which find the add we've So, -- but add my when that's one RESET. if where that's for to find important the most talking, improve you been you the up absolute when sensitivity keep where point value, All you up that's EBITDA I improved in resetting that's is up add what the last one, that

improvement all our right? to few incentives of things adaptation of which The variable go. to ready top the longed said, do to And on there I the nevertheless base we've So, valuable that, are an the cost EBITDA RESET. in but revenue on It's base. non-permanent, other Australia good the are cost, improvement in that is, costs, things

M&F not to Moving cost On remains about slide. services; are talk the as fully case to base. to flexing negative of Service I'll has for EBITDA revenue like quarter next the last hotel we it Owner, base here just the been the

but in because some is governmental reduced. there to detail is we off Like now I It's just would from There I you by going one-time is being furlough hotel benefited like lesser for a also despite we that recall, M&F at is extent. law an in XX; so it. -- to move The page who. the Australia, in highlight why the upcoming one-off good fixed HX. detail scheme; you Australia, better disappearing furlough If a of mentioned which performance coming same EBITDA. move M&F subsidies and thing I'll which was being scheme aimed and one now. for is down. slide. business is one more reason the assets, so a new I've the may Germany to that least as in business also better hide I did here example, fact be EBITDA costs or that fundamentally the the of would to payment the won't reason once furlough and there over also a that from significantly no get

-- hand, nice a in have one-off did On we one-off the Germany. other a

they happen necessarily again that's do to one-offs. do in again, like HX; highlight thing would I because, one-off why not that's one are not So these

to it quick. Australia. is is is And mean, businesses. new that's The XX% bit, Asset then I this and relatively Europe a on If XX% variable the we've that you leases two-third assets; go little hotel got is Then in which Hotel Europe. one, is and America, Brazil. there I'll other the move in

of profit, translate back said So into I EBITDA got and when willing and because variable were Brazil The the Australia. reason really to is you've EBITDA the the are year. largest of businesses get then for better And from you last improvement the basically Australia to the very leases. that protected so all of good these was people life than the new coming part

on variance no So there is this.

have you So that's transition can the that profitability. hotel on asset

you If XX. to page move

to to below we -- EBITDA net Now the the profit. lines move

that a that. of of share generated Europe. profit joint is share we of XX%. The remaining or good. and to variation share is AccorInvest went can of we Europe now AccorInvest venture million. fundamentally see net through positive You which losses €XX not large joint Very was is associate venture here. see you of Again, net where invest

performance then It's included since as the year impacted was slightly than AccorInvest but year overall performance mentioning And seen, was last time, it nevertheless, that So because by Europe of negatives. last better worse. worth working that has of end business owned lifestyle we part are on since the the asset-light -- that platform creating we've XXX% been and XXXX. and the a out deal asset-light platform of now been

So, line essentially [indiscernible]. that been has

may part our situation. clean heavy -- than in state we element it recall an of was that format, asset-light was You asset sorry, [ph] SB days, those and to

that. see of Huazhu; it great through We So the went and so mainly is Huazhu that story. we a to numbers. in the did item Non-recurring is effect related you

on sales, we return You times that X the round times sale. round first of second on of sort the got of X kind on

in RevPAR financial the So we are the Financial cash investments of value. but following of you've venture X.X% as to of at sale, effect fair the that stake joint and have what that a recorded generate not million as of investment. a sale got is, you've here the €XXX accounting got adjusted February additional

when did on of So remaining upside the value, to we the of February we at the we -- -- -- sale amount, X.X%. full in fair stake the to when we sorry, the captured recording the of the fact stake

that's accounting. the So

X.X capital the the stake to residual So for recognition €XXX is gain recognition. more than tune million net-net, of

cash in If burn. a you HX of highlights here that as you last there year, see what again couple Still move improvement negative to it but a here. was on cash; significant the was

of HX. and controlling On this a that the because very did context, know investment, recurring put over of situation strict the you we difficult

Angeles to we're the a number key is that will see cash in because And first there some figure so double-digit some not is the notably, number what is figure significantly one. It a in have money and is not up go Fairmont will just hotels open HX. non-recurring give HX. outlay. That be would Los number €XX one going you you the higher I'll will you In million investment. and a HX, in

one So €XXX that's had confirm be just to that and the one. to other things I We can Nevertheless, provided the €XXX to you tell how move million period we can before. from to million. chunky you -- do guidance said,

I think low will end the the be in million bucket. of €XXX we

mentioning working capital, The second element is very worth which here is negative year. last

way, it You the business may the a crisis, fees the it's and working here. collect you managed. normalized if the tough And negative, but -- that would the had is of well if and back XX a it's that the COVID the much We than first has is you you recall may half of a It say the more recall is good effect. level, been level. do number we negative -- the significantly to got by as you've capital because year, what I negative of negative

at that we from so that when rating not that are we've year in we least, So not back unknown from it's all agencies point working in BBB management. time. all, again one good the but plus, debt capital just the BB to but credit moved highlight downgrade add of the minus The Last that's a cost step-up to very want it. covered reflects I and here, ago

the that's on on, burn. that's So cash

the cover, are the crisis slide sheet the to that COVID. like Obviously, balance the the one last to move slow of is stages liquidity. the that you living just which we will I position is with If important very

over between provided capital and at December are HX the The the is €XX stake disposal. items, to also part the Two any of a X.X% platform did repayment -- there is know million, million position that which -- shelter the of. here creation you we The of June. comments bridge in amount and know small Most and through. occur the burn, billion €XXX increase you of, liquidity X.X is €X.X Our AccorInvest of the that for that's this which February. things I'd like we minority debt in lifestyle to back the just you what buyout cash The complement went with.

So, the €XX paper. were HX. million to more in paper times commercial X and able commercial the million €XXX We issue

I it you've being because think asked other, non-investment outstanding on the to it's got a [indiscernible] hybrid €XXX cost. of coupon we're in the appetite commercial the grade, you credibility and the paper things of and restructuring cash market that's why the the economy. for program of besides able a few fact million translates like In have XXX still also the

give to detail, would which floor back like give I you closing to Sébastien remarks. with we will that all -- some the So

Sébastien Bazin

Jean-Jacques. much, so you Thank

on here, are two page we here. So or back XX three things

easier and bit part, be with everybody last sustainable quite the things XX to only partnering been quality. gender for generous, a been the with inclusion Expedia years. the of based United reaffirming with to vulnerable. who staged been on On been we be doing we've XXXX development forward sure over different just its going trying we partnering make not -- for but trying actions people. make We've We've measures, which exists handicap by we've diversity all also protective being Nations to to Accor with almost years on which the helping ago make acting to sure something with enlarge program, the the UN for all planet heard different is teams XX left and We've is undertaken

is know, fund or not access food €XX to get number have numbers and very, because together closed. also disarray people Heartist of in You it, below. months we be being not the hospital we hotels to We that the huge a and have ALL of get who did XX to which to initiative, put million would ago. being access or furlough did put proud probably of collectively very help or aside The

of distributed have individual. our asking million roughly per last Accor for and years XX in over is being not been is which we've That been people it the night, $XXX of over. XX,XXX last granting XX that's As help

our build be core to XX to there for what years the continue in built. distress, helping was will being those last for been We who've

XXXX. We protocol do footprint also in be XX% back. made the Commitment the set of hotel. of and that important all even to displayed the the we to on year been a course our corporate had of business being strengthen of of the leisure network Extremely further. have displaying is And core. for us and by all And carbon more we to

course gender in bodies We we plastic, have will rid of will And parity and by XXXX. committed to the different of and we execute we getting on achieve Accor. and of all the governments unique guest-related item

I are -- exact five story. seven reason priorities XXXX; to get three have So her we exact have to probably it will have why, for is last going date; of page that's months five, to We you. we at back ago, is her The you ago. weeks you two XX. the and months a months the and who it there to general Brune might optional team. know don't time same the comes Those when few and not change the you end half and joined Poirson starting, us It's seen But it's and a actually and XXXX. of commitment be page, we CSR been how, the be ESG of dedicated but assembly no day with full has being could collect, undertaken, could driven a early what page very which when. there is to the or seven or explain fall action

in to have again it's it one, months we but July, we super so first in agile. the was in rebound great wherever good we and great of is, be benefit it told from are the summer in June not to be you The ready going to September. Australia, I be as it's and have to

be be when We ready Southeast Asia. going in have is to reopening to

to We to rebound. America South have help

We welcome. have to be in Dubai to

Mexico. Istanbul of We exists, the in of do the to in team Mexico XX% to Group. the tell extent have have room open question. it no hotels you or ground Whatever we be Number -- on and to -- or being to XX% we board two, I have can

to We the sustainable, is actually to moving there. the can Jean-Jacques Loyalty would forward. have Those improve talked the as. going They we with in you We've they're BNP €XXX be deliver put reinvented. being bank. to Limitless us saving. very Number VISA and on launching card be margins million branded you Live RESET been XXX% that powerful have be plus Accor helping It to It costs Programs. new that about, and three, will a

it. six over with continue people good four, And less of upon as a in do speak. different success great X% we the touched is many signing worth for bit other you As to and months, is pricing. the I fees signing We weeks displayed is it of car people It ago all get to it access use is of million they been a about with brands than lot we've XX a months. better is three it think and program probably developing last of it time of it. and of have to the Lifestyle We've value the Jean-Jacques going into we major talk our been being have partnership we and markets. to lifestyle. We're Accor a signing actually of entertainment, that have to members. Number rental It XX% industry. last XX% six over a years, XX course more than to last the

and been government is And, launched and is ALL Accor. we've about present existing the This very capital And why So pipeline of which to field all of it's luxury, key. owners the brands XX we've it is on Heartist. with strong; there which Human XX% far is falling is side, vis-à-vis more talent well progressing is the finally, being why is Accor network really in is the so entities. this the Accor the the not than pipeline all, more. is the and the at

and to Accor the We that from by to we over ground. to have we And local the compensating ground, team We countries also on being do in all positively the do having reverse. on to exactly to because you contribute there of be show are you are run help all community. do and going of the Hotel we it are activities Accor XXX have really to team what through we're being able need

where years with company take on you Happy is operating the or with Thank being that's listening handicap. really we XX those of course, because existence, each questions of people the us, a XX minutes phone. which of And local that's shift is really a are anything this great it of training it all Floor management have minutes. be we and education, So procurement; to is XXX-degree help who food to employees, advantage for to for a now on you. around are. XX we make last you back year

Operator

line the Jamie And from go question Morgan Rollo Please the from Instructions] Stanley. [Operator first ahead. comes of

Jamie Rollo

questions, morning, got Thanks. everyone. Good I've please. three

sort data you on you the slows any RevPAR perhaps with of travel other Are July. to and into could the summer after us some given encouraging improvement of weaken corporate indications you've demand leisure that sort please. expecting of as early First, share momentum

I sounds is some first €XX.X million of sort guidance sort million the Secondly, the to RevPAR if to EBITDA. this half like but year. €XX the of half, the a implies still of on the there one-offs in second full-year like of like in million sensitivity of appreciate you'd sensitivity something €XX guidance

So, the why be you more the than worse a slowdown sort Where signings more It in little a a talk that? bit guidance. of sort are could I then, finally, sounds bit And the note original cautious drop Asia would you're And wondering updates. pipeline. seeing seeing. of it about Pacific I'm of the just you last sort in

So is the that most of of Thank the slowdown? area you.

Jean-Jacques Morin

morning, is This Jamie, this is -- first. Jean-Jacques. good

The a very not important the thing is, I'm HX saying it's me that I'm be €XX below the will I'm question competition. be saying question. Let €XX will saying your in sensitivity sensitivity take million. million. That's because that sensitivity the

and mean, €XX to €XX million was second good is of additional mentioning will that saw of encouraged RESET in a I see in HX. and I'm will coming the that of of in goal. drive out that because we in the first the the fact, continue than a second on you on I the take right RESET year. of in savings sitting on been And a the the line €XX of in part work here. reflection year what very million done larger and, the that's of the program part So has part million the practical for by example trans now that action and as fact that part of very first The the management just savings, cost year the will

So your way here. I'm going

I their think computation. own looks the million like €XX

planned the the to stopped fact, part On jurisdictions hard, that just countries also most year. the schemes other you just hand, the if to I'd scheme. what second of is most pursued has like that furlough furlough be in say are in of go in the Today,

So that's on part just the contrast said I cost. people what of

We knows. talk stringent target. being on a we honing that You I of of I today but July. the zero is lot what company part sure as monetize anticipated. kind extremely, God All in being about say, being cases COVID making their along down guess saw not cases, HX. at significantly in nice we did also seen totally But that last this higher see Australia although would is we don't

of a got that news the you've of moving effect and the that I is incentive. good just another piece it went So in HX. to Then target. explained was incentive

if Now kick in well that doesn't Australia you Australia. incentives as as HX, go won't the for incentive get

moving is element, another wrong the way. that's which in So

be about in the HX. the much On mean, volume hand, I than we're other talking should just HX in better improvement. RevPAR

at I have And so level issue we one we've that term QX and much in the fact disclosing, the business in sensitivity should the in by and what disclosing of volume. should as is first have topline RevPAR that the be of QX the got we've mean, end, the the in been sorry, affected fact numbers enough stronger is we we got. have don't be

the way. that or it is because to all with I question trying opposite good about thinking little the bit I'm answer. want thing asking that same go very that and sure that's month just know make I to of And a question. comprehensive you going the into so And get they

extremely and in doing what it one. of fact will we is you better, be line But line have on mean, focus doing explained, plan the right moving still just I in visible. bottom we the that is another started Australia Sébastien topline direction. is So launching well. the been I in What UK we've one. been All that is with the another

So, year. I'm €XX million full be confident below that very we'll the for

Sébastien Bazin

Yes.

Sébastien On things, two Jamie, the -- here.

On to the it the good business, September visibility have -- Certainly, come. expected. to than strong August leisure and comes we stronger is it's pretty when question, eight a first and for and we next weeks which the

we're probably the might large XX groups still people months people, to regional probably It's end I groups before. XXXs no low clearly being of less it whether signing, XX event the last year. We activities There fear lot of question comes small have of But corporates gathering mark. a guess signs, loss have better to seminars we people is of I those large signed XX,XXX going had at very for November, When to December. being happen across XX,XXX which have than of were for It all. good domestic XXX There regional. the those XX,XXX the have December. rooms November, were HX. a buffer of by September. MICE There to for We We September. and visibility between we'll I for confirmed but reservation still know rebounding, you don't months could corporate to of know the XX small XXX, October, really believe October, asking is in for XX year

could happen nothing all do you be of our lack of or all know And brand. signings why know developers attractiveness with the the travel. the happen just XX% You Asia-Pacific, more Pacific. for that in in to for is of lack years XX% pace last of to has not It's that five activities as Asia of

away move from cannot You Singapore.

You Cambodia. cannot enter

You cannot leave China.

cannot You enter Malaysia.

So, they it's cannot not go inside.

documents where The plus you being terms front when be of has there. are course, physical sit. years, attendance to for But have owner are also the for that we basically you something the of many question that commitment need in XX on to XXX So and of million negotiated. context in sign owners

reopen of being a getting hesitation. vaccination frontiers only getting it's So, that and out, matter rolled

a the few matter pre-pandemic pace to see signing next coming You'll the in the ahead. level only of back of months of

as frankly related. So it's

Jamie Rollo

you. Thank

Jean-Jacques, so, off it was the guidance the it. And I I'm below if where just does just randomizing come Sorry can on slightly I back, going million. €XX EBITDA say sensitivity?

remove So I guess towards we you're saying just slightly. should

Jean-Jacques Morin

I the I that today, will deal stop Okay. go close food that. with for you would

Jamie Rollo

you. Okay, thank

Jean-Jacques Morin

do that. Let's

Operator

question from Your from Jaafar Please go Exane comes next the ahead. Mestari BNP line of Paribas.

Jaafar Mestari

I have the if and drivers of management in possible franchise. come improvement I question to EBITDA everyone. one back morning, Good wanted just the on really. Hi.

as that fee?. better. much I year-on-year you of it cost at the important How you looking incentive most are, M&F is and million how RESET better is I'm M&F of the which that was is EBITDA if mentioned, revenue, M&F think So €XX €XX much did, revenue factor, is savings million Jean-Jacques,

of regions that in quality HX. perhaps already play that but already like Middle East suggested very like lower lower comments would already Your that material, And is stuff Is flagged at be elsewhere. provisions. you've then that much material the not in how

If €XX helpful. would you be down that million could break that

Jean-Jacques Morin

Yes.

merge There what it Let's it, last is said. make and a the There net sort year go of which go sort into thinking make because the tough, grant crisis the take all it is again a we a I debt numbers. the RESET, is knew is it that which buckets is fact is of simple, okay? more you which nobody of you a sort is it in into incentive. which would this because there Without going which significant that is three the granularity. would of To that can marginally else, did call bad say the sort to account of is after everything There

today. was which what year got than stronger furlough you've the last got You

element, things. and the the is cost, furlough which of those bucket, bonuses last variable bucket RESET encompasses the like just call So home and RESET some of other kinds

it one So sort. one simple, make sort, one sort,

Jaafar Mestari

thanks. Okay,

far you itself, third less lot is a one if said a and third [ph]. part it's HX RESET, as in So so cost is RESET of than the

Jean-Jacques Morin

No. last bucket of No, the many a that net was Because, I because no. said things.

fact want -- I because once to correct confuse matter. I you, and besides a so debt confuse the And just everything everybody. is of don't just sure to that the clear want that It is that is complex and incentive Is don't else make I ones so Jaafar. want the reduced. net because to

Jaafar Mestari

you. Thank

Jean-Jacques Morin

Jaafar. you, Thank

Operator

from line next comes LeChipre Your of from Simon go Please Stifel. the ahead. question

Simon LeChipre

morning. questions, please. Three good Yes,

And moment. dynamic at HX? we would you least you you that that August should for on expectation more you First give share you. the of of on minus speak for you through. summer could QX share range compared with update in us also where what the terms sort just see RevPAR could you trading pricing Thank the XX% for the have detail positive or But us have working that at of rest of the July And all, the season. the for perhaps capital with of lastly,

Jean-Jacques Morin

Okay.

working take I'll capital the one. So,

did -- working sensitivity got. The had for net back what for good RevPAR. capital. happy I what the we that we burn a guidance net but zero of to like for the like February is said is from number still to you year Just in answering cash on comments, the and very with with I'm your in working old I'm numbers in school, just part change coming sensitivity for given question, capital. we i.e. it full that working capital happy

positive you that that number. always is whereas and negative is we is here number granularity why reason a give our a know time can't HX say for to HX So I the

the anticipated will but be being could holds. say the I number has So so number, positive what capital full positive working that than HX been target of year for the been a negative HX the you and and negative has better would the

So, the cap. question working your on to that think is answer I

Sébastien Bazin

better months alluded three enough, come. in be the next the cannot it weight -- I fall, X% for the in almost information. four for leisure Funny might the give RevPAR versus that the then I had to because that that I you won't will well I hope on thing to told to true have one, we be the benefit we last because of simply don't for last know I am The that which improvement. my August. then have symmetrical still months be but but don't case you you I enough come. Simon, case, the Certainly hopeful to the other only two coming it the for months we the business. slide, months. next would the of September prolonged corporate X% business first

a soon for too So guidance to you next us even give on the quarter.

places because way, that XX% on as pricing The XX% you Mediterranean Europe second go thing had better In you shore, when a you XX% what on you're is you pricing, a below your told have you XXXX occupancy above have seen so course which non-homogeneous. in in get way price In in I you in it cities you to full still XXXX. occupancy, places reach pent-up urban demand. is the of other and could

not I a of It's timing matter you only can't So so because give it is homogeneous, act. you where which you. and sit

Jaafar Mestari

you. Thank

Sébastien Bazin

welcome. You're

Operator

UBS. of Please form next Your line ahead. Aziz comes question Bilal from go the

Bilal Aziz

and for everyone Two morning, Good please. me, thanks my for questions. taking

fees. incentive Just a quick the on point

did in now then secondly, to you're you expect with point you next have US reappear the in book for windows Europe disclose time you. given you from see what to to seeing to do perhaps quarter, or peers increased starting year what that. portfolio. of in the booking could started of now Europe the so part Firstly, talk in occupancy tied Thank there second exact that bookings. to booking with now far some and trigger Are the you third just to perhaps And your occur right your quarter the number about advanced extending,

Jean-Jacques Morin

Okay.

because you I at it. financial guess will precise incentive, statements, probably you you if the look number So our on can the give

Last we basis the year, X%. be what said is of XX% mentioned the that had at would revenue. you we M&F as So still recall, I percentage a incentive run may total of rate

So as was of was revenue booked was HX, XX%. and X% M&F of XXXX in the what incentive total

is as to that just you it So is how improving. a percent and give

absolute don't XXXX million €XX in €XXX XXXX, the to you the do million computation, value that XXXX. €XX so Now, about in million and in have

the booking On numbers window; it course two of I'll week. you varies also give per and

days' the notice. For less than group bookings XX% at have our of level, Accor, three

And Europe, to a in Europe, and very understand it. I have are the learned so of third the booking that's less waiting Northern People the of Northern for yesterday, has by have to -- way, -- hours. XX a which than traveling. you Europe last So rules understand third minute

and three facing. if But that's Of you you're going then hours course, that number what can we're okay. by [indiscernible] probably away that's car,

So, we're I to going enlarging guess yet. have hope the not a and three we're probably to days that better But probably I week. notice a there

Sébastien Bazin

also cancellations is in and And then, level. stuff when cancellation following huge but the just saw changed. states, the were mean, a that as a you complement this rules of lot one. on you What in window matters I also booking, increase but bookings saw

don't happening in today -- we cancellation. the of and France and I cancellation increased was can need the based COVID actuals, you see made I really wave on tell have about and also on monitor of hence happening, comment when you what's been so I that first level has that you to talking what And

Bilal Aziz

much. Thank very you

Operator

Sure.

Clarke Your line comes of question Bernstein. next ahead. from from Please the Richard go

Richard Clarke

-- thanks questions. taking and may. for for morning Good my I if thanks Three, Hi.

that of your of one X% the half. last hotels Maybe second obviously lockdowns based point, of performance on opposite directions. sort a else first month million, second the the And maybe is; the that of where closed, revenues discounts your of you declined timeframe bright revenues improved in bit on sort in has moving how that what news some in million. And expectations those SMDL are in And by to there. on those. for the just there? anything could what €XX just half is the happens question, €XX and your reopen still your trended of Is put are then, by news third of unpack believe spot some reopening. now? there Just sort the Lots question Sydney, first as regional was you the through a a Australia, of cities details just why Is fees in just are or to is M&F being and incentive -- your coming is in do commentary that or those other some

Jean-Jacques Morin

should something I'll take -- It's the because question. it's it's one have quoted. that a I very very last It's catch. good good

In fact, points. It's there is important very no renegotiation whatsoever. a

the which the the of in booking you counter. that this seeing going that counter business discussion when they The So because people be done go right? that there that today room occurring and because consequence thing that are it history. what attached get is fact to directly, COVID of has in when of visit into been hotel we've which Quantifying scheme. on extremely is is they crisis, distribution out history. than fees the the and is the will and crisis SMDL about basically of directly that close hotel, the to XX% hotel in So book go go fees of is go book no guide much are to the the to the that doing of more any is the than changing didn't the fee all of we that way is used the to there less is the What summon positive no one directly hotel been XX% that

you've should because one MDL channel, of the channel. non-stable that mix everything element. why in this That's indirect that's versus direct of I is revenue equal the stable down so of And say got versus being

business. the people enter the into fees quarantine for COVID meaning In much Quarantine we've hotel is is the Singapore, government of themselves. The of to linked want go which other it the again got which who to into crisis to one, that In they've pay that is quarantine. the XX% XX% got significant that business, quarantine our probably business. country very Southeast business Asia, and forces is a to

So, that. again distribution there marketing the of business no that the attached fees sales loyalty is consequence to quarantine is

on In very Australia, the that's picture. I Australia, two different of So answer in think SMDL. you've got term

end at which of You've you one, the And is Coast that extremely the got doing up see are well. this XX%. the on June, the versus year Gold coast, RevPAR last

very negative We're significant So talking increase number. always in.

it's Here, a it's a and number very positive significant...

Richard Clarke

to versus That's 'XX?

Jean-Jacques Morin

yes. Yes, XXXX. Versus Oh, sorry, XXXX, year. you said last

Sébastien Bazin

and 'XX last XX% versus up XX% versus way its year?

Jean-Jacques Morin

our which Yes. Yes, are the a on And hand, cities, activity I depending I more negative on depending and -- international business much sorry, it's other on the much number. was. booking traveler big more fundamentally

at XX% they XX%, So versus are minus XXXX.

picture, so business very to that find you business, the And different which different you've very leisure you coupons no is got the by QX. this than is UK is what The find which way not France, in in there. anything is the going international over in recovery we're face that domestic good, what

see portion is of think recover. saying the so by the of kind and here cities talk affected portion monitor are by want I which of about you and That's limited to it over is I Sydney on And of to extended the like we they well other has be which more the it always QX Sydney in that to side very that way going how case. to that number the Australia. positive the Melbourne, And business, Perth closing by and these Melbourne. than

a McGrath to put no got is He because on in is of actually when for go They XX%. out that Australia. is of CEO you've not lot and than super it's stay positive got clientele be in the get if vaccination just difficult the of choice cannot confinement work of below is who aside with a Australia. elsewhere which we again spent domestic money Simon lot a There other Richard Sidney. which to for than They've as right time drastic. Pacific. And lot contagion really of Australia, is So, of a you that, but monitor, with to a extremely

Coast. to in December. will in October, otherwise winter So of in is It Summer November, Sidney going be February back. is January, spring is that Golden money spent be over a the months there.

is very he forward good to comes December. for when and on activity So, Mantra, November looking it

Richard Clarke

to reopen? And What's X% those the still then, for of today. hotels are closed the that timeframe

Sébastien Bazin

South of are where of Southeast lot A lot closed. frontiers Asia. are being them them A in America, are basically,

Richard Clarke

Thank sense. you makes Okay, very much.

Sébastien Bazin

welcome. You're

Operator

line from question comes Your Credit Leo ahead. from of the Please next Carrington Suisse. go

Leo Carrington

on I Good morning. please. few a some RESET, Could just have questions

will is be ask XX% you RESET [ph]. this to -- years SMDL I expecting owners is profits not once could RESET think, sort elsewhere. fantastic. of there plan expect SMDL there dynamics apologies EBITDA remaining going HX to way your over of Firstly, next. you And assuming of revenues the same any And just plan then as fully retained, The or you expect it's be difference one RESET complete just you asking Do think improve I split color improve savings kind related do see and the if who between between for will and in bottom is, do the the a is the be ALSA how just are a retained SMDL? what savings the and ManTech's you any hitting fact would then SMDL but still for in this and line point how reason if a lastly do

Jean-Jacques Morin

Yes, change the There XX%, to one. is XX% is no high. still that

XX%, not numbers, As the of the by you holding. end the the is XX%, million, has, all any fundamentally frustration the €XXX plan, time is as I progress. said, XXXX of But changed key plan €X million, the every that There means. as

back earlier SMDL said, that's a get of is the again back of of part obligations And parking, I to And a what I this to pass still here to to SMDL. of SMDL free get States on got got of needs some there no some this and so the that before the thing to something obligations So I've as be that we've that I that time are is we say part On and contractual to on our will change term many the and know positive. do we mean, very question would on the positive in that it's in competitors, contractual line negative in we other whatsoever the still through. one. profitability have I we come no SMDL, line which difference discussions.

US, right? that what we of So have on We that places the have in don't Fairmont, world. in in any the we a the on bought

things So I much you one. think business in that's And think as being will would -- so this you would from start of on to everything have on on September that HX, kick on SMDL the more the equal don't going don't I work stopping business, which or booked is or channel car to directly because the hotel what. by and know the typical counter and directly not through people to funding hotel their

you if that's improve that what should sell equal; think I one. So won't number on things SMDL being this on would

Leo Carrington

there just plan XXXX And RESET -- thank savings being now with question? just here. difference retained on Okay, the is this hitting the between with line you. sort of that, and you're on bottom any margin I'm if thinking

Jean-Jacques Morin

us XX% and business no M&F as is and -- another I the went would that end -- and of everything the through significantly will more you be that profitable is M&F course, kind much would those the margin do the we call enough equal on business. there is probably make M&F on being in No, the on the of of savings lower there one plan of at what mean, prove because difference.

the I I February I of know, I got. in that's -- to that gave, think don't question answer I think one the

and So, will €XXX the million again, at on rest you line. find the bottom

Leo Carrington

Thank Fantastic. much. you very

Operator

from Bank. the Your next Please question Deutsche of line Juillard comes ahead. go from Andre

Andre Juillard

morning, may. continue questions I If if margin. and RESET Good Two I gentlemen. the plan on

distribution. in especially million you to be purposes that some savings have of wanted if of don't part on them about thinking ask the Just expected think €XXX to reinvested will you

question. First

the all looking exit that you see you Mantra the question but and answer. groups more M&A. general what disposal see of considering of Do Second industry the could sort about about you be any consolidation is included think are window crisis, potential this are the for do consolidation Thanks. rationalization more to we generally of and in starting part for

Jean-Jacques Morin

your to to no is, whatsoever There is obligation no. do an answer question investment. the So first

today continue in has in that. I to brands -- stuff history what company. to happen the need and in I in invest and will happen happened future will systems, think continue is happens into and and we don't like the to

any invested will kind Had there things better of for the all have obviously, the to improvements It we per marketing, that or plan, those are be we improvement done no in not a allocation which into those RESET is tools all million improvement So recognition, of been of would on here, better is I'm brand things. ABS, action. counting €XXX not different. but pursued, se

then, the -- So two, I on link would Andre. M&A not And

Sébastien Bazin

of questions. answers dispose million -- of Mantra, not it's in to with M&A, Mantra On people it plus We Why? EBITDA months. next back downturn XX two months to are and there is EBITDA leasing as because is at the your €XX above of need we Andre, the two Australian we speak We've all you losing and elastic. back On it for to commitments. the XX question market. order to it get buy for it to been back intended need so in It getting have to bank the your positive

sell it sell have any foolish and stupid today to and to would it -- be today. and reason it we don't So

ready will on should day that and tell of any at we of be But marketed. component being rolled months, that management months commercial out. sheet GM to is to activities of and team implemented, because is it finished the XX it to hotel term to for marketed the is the balance assets any all receiving to So and responding do and be something vaccine must When I disposing you I people, medium RESET customers it all time time my and XXX% to the comes be legislations day consolidation, can shouldn't new readings guess we the of simplify not long-term, it we confirm Accor XX simplify to next Accor. for

no and to consolidation. it time no will spend comes disruptions when to have we no, So, any

Andre Juillard

Thanks.

Operator

from ahead. question Your the from go Alex next Redburn. comes Brignall of Please line

Alex Brignall

morning. taking Thank Good the for just questions. I you please. two, have

changes and you year, business Could significant. a drivers us look please. between and it leisure loyalty of you a little on information second discussion question else your of Thank on might for full the like and travel about you one, detail is be what the on mentioned growth give give that the the just that higher be maybe factor. first us have that bit And system mix that you. for was the a anything that, you pre-COVID, Could The are then, just churn little of or that the bit would and making. in you

Jean-Jacques Morin

think I Yes, one the churn. the on

the for XX months FY year for churn So was to The for churn X.X%. for the X.X%. and be number, XXXX the last you XXXX X.X%. precise is The give to be and last a was churn specific X.X% churn was

said we So that's expect more kind why and around line think would I what less are before or of X%. are you I in with we

or So would more the are very level correlated the the Group being those higher Alex. last on basis, model season. that's customers, which contribution, on it few summer to leisure expect a of the much by to at than XX% is more running normalized the loyalty used course than which is less you the burnt weeks of and be And two-thirds for

the end to So corporates back reading be in when of we'll this fall. going the have are better by a year

Alex Brignall

leisure before of Could COVID terms number in say you that what was please? versus business,

Sébastien Bazin

similar. very Probably

Jean-Jacques Morin

business we no spending of numbers by so of come discussed sense. the you've that get quarantine we way quarantine HX makes in got some you've those on time the loyalty numbers You It got it loyalty don't and why you've that end Australia it's When happening The worth got on which related up too in no whatsoever, that much the back to Asia got of and to was those that one, also Southeast keys this not business. COVID you've have right? last what's Alex, business, business creates that much are may today on is part did what qualified. the All any quarantine.

Sébastien Bazin

wish we could. We

Jean-Jacques Morin

wish could. We we

COVID the our that for can numbers. wait we we So, increase loyalty next crisis so

it's we me think sentiment. we let the -- me really aside, side let not because few about having -- of fact, because really that. are -- In joke Joke numbers

go as able business normalized say, analysis. into the -- I So soon be to a back height channel natural mix, the and level more would into to will more, think I come as we

Alex Brignall

Thank you very much.

Sébastien Bazin

Sure.

Operator

line question Ali next the Please go comes HSBC. from Naqvi Your of from ahead.

Ali Naqvi

question. the for Hi, taking good Thanks morning.

-- the wanted ask to for Thanks taking Just on question. okay.

QX. it what can see much on in recovery versus occupancy do insight by region. obviously the But the any Could how going balance us RevPAR you year I wasn't occupancy, on that in rates? was rest that give Just itself to as varies the think improvement an of and you there will for and July

Jean-Jacques Morin

fluctuation gave mostly thumb on mean, that a is five -- driven kind Sébastien is occupancy is you se. I very per Yes, by rule there price month the and what points the of of little every on

X% differences XX% will job to faster Europe a kind jurisdiction. than simple And should of find go so up that is want occupancy in if by a you out be go much the that called. occupancy mean, by average should have all you will and there I

Ali Naqvi

positive. is back when of -- you on scale? Is Would just would get your or liquidity the increase what the being it look sort of of in and use you priority Great. the that And terms you cash cash? to return to

Jean-Jacques Morin

a return the expectation is model invest the the to go part I is in mean, we in we're what you model recall somebody would developments who ours. share may going And just business which XXXX, business like about -- of talking that And to shareholder company launched a into before buyback we had January a that from buyback. grades and share of one. into perspective were

at returned. look how So we remains a excessive our of think cash be basis this I could potentially or cash

the paid other analyze where we we also value created. you are which will with the hand, we know is is do what on greatest Now,

So bolt-on. share between M&A and buyback potentially

that discipline with last lot COVID. doing were the over of we a before years think I quite two

is create may this practice much us if value last about expect you And around should what very most best share the continue for computation. rationally you of recall, and the account to what the act take is would that over You do and market the you every to two, years X% market the return year, -- to three we that shareholders. into

Sébastien Bazin

another say it. It's And it way to and people understand Yes. will quickly. -- very

We the for have been last proud to XX rising months.

been we the is we Heartist Accor, we which Hotels put ALL shareholders. later, make the this protecting we've company protect us sure and sequence is why owners employees that to and course. Fund capital three post-pandemic Firstly, which go why the assisting It's of time they is protect now, Accor sequence really exist. months value to Two, of and the of That wherever is for sit. of starting for enhance human

Ali Naqvi

Thank you.

Operator

no from questions the are There currently [Operator Instructions] queue.

Sébastien Bazin

an had we guess enjoyable I time.

Jean-Jacques Morin

a that comment. That not was a question, was

Sébastien Bazin

I I team Thank believe, questions, and it will here a to further few think no the do you have pleasure introducing we Unless great investors Rebecca of days of Pierre-Louis you. do all next in the a is case, to assist everyone. talking, and and each you, you, hopefully I of Thank was and course. Bye-bye. and to shareholders come. job

Jean-Jacques Morin

Bye-bye.

Operator

today's for you call. joining Thank

may lines. disconnect your now You

Accor (ACCYY) 1 Aug 212021 Q2 Earnings call transcript