Accor's second-quarter revenue per available room fell 88.2 percent year over year on a like-for-like basis to €8, the company announced in an earnings release Tuesday. This figure, nonetheless, is higher than the monthly low points of 92 percent and 90 percent year-over-year RevPAR declines in April and May, respectively. On average, RevPAR for the first half of 2020 was down 59.3 percent year over year to €25, reflecting a sharp decline in occupancy.
Occupancy for the quarter ending June 30 was down 56.7 percentage points year over year to 14.7 percent. For the half year, it was down 36.6 percentage points to 31 percent. Average daily rate dropped 36.9 percent to €54 for the quarter, and 10.7 percent to €80 for the half year.
The results were not unexpected, given that the effects of the Covid-19 pandemic and governments' travel restrictions across the globe.
"The shock that our industry is experiencing is both violent and unprecedented," said Accor chairman and CEO Sébastien Bazin. "The peak of the crisis is undoubtedly behind us, but the recovery will be gradual."
China was the company's first market to restart, and Europe since June has seen a similar trend, with the gradual end to the lockdown in a number of countries and the reopening of some borders.
Accor continues to reopen its properties across the world, after the April 30 low point of 38 percent open worldwide. By June 30, 68 percent of the company's properties had opened, a number that increased to 81 percent by Aug. 3. As of Monday, 86 percent of the company's Asia-Pacific hotels were open; 82 percent of those in Europe; 76 percent in North America, Central America and the Caribbean; 70 percent in the Middle East and Africa; and 65 percent in South America.
To mitigate the negative financial effects, Accor has implemented a €60 million general and administrative annual cost savings program that was 60 percent achieved by the end of June, sharply reduced other operating costs and suspended any share buybacks or dividends until further notice.
In addition, Accor is going to "shift from its new asset-light business model to an asset-light company," according to a company statement. "This will lead to the implementation of a €200 million recurring cost-saving plan," which includes simplifying and realigning operating structures in different regions and automating tasks for repetitive processes. On an annualized basis, two-thirds of these cost savings will be generated by the end of 2021 and 100 percent by the end of 2022, the company estimates.
During the quarter, Accor launched its new All Stay Well cleanliness program and label for compliant hotels, as well as its All Meet Well program for group business in North and Central America.
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