ACRFF - Accor SA's (ACRFF) Q4 2023 Earnings Call Transcript

2024-02-22 12:54:06 ET

Accor SA (ACRFF)

Q4 2023 Earnings Conference Call

February 22, 2024 02:30 am ET

Company Participants

Sebastien Bazin - Group Chairman & CEO

Martine Gerow - CFO

Jean-Jacques Morin - Group Deputy CEO and Premium, Midscale & Economy Division CEO

Conference Call Participants

Andre Juillard - Deutsche Bank

Jamie Rollo - Morgan Stanley

Richard Clarke - Bernstein

Vicki Stern - Barclays

Jarrod Castle - UBS

Jaafar Mestari - BNP Paribas Exane

Jaina Mistry - Jefferies

Estelle Weingrod - JPMorgan

Alex Brignall - Redburn Atlantic

Presentation

Sebastien Bazin

Hello. We're going to be opening the 2023 year-end number release to each of you. So sorry to be a couple of minutes late. So first, welcome everybody to this session. Welcome to those of you on the phone looking mostly at Martine, and myself. Happy to be back with you and happy to be sharing with you what we believe internally being very strong numbers and performances for the Group.

So, let me start with something which is a bit of a 20,000-feet altitude, which you know I love doing. What you have here on the left side is the numbers all of us know well, which is the 1.459 billion pre-COVID numbers of international travelers. A lot of us being -- hoping for V-shape scenario, which is clearly confirmed not only in the slide, but I guess in actual numbers. You see that, I guess at the end of 2023, we were still down 12% versus the peak of 2019, so roughly 1.284 billion.

Most of it is people not returning from China. And I'll go in more granularity probably during the session. However, United Nations WTO, which is World Tourism Organization and which comprise the airlines have been confirming that very likely at the end of this year, 2024, we'll be above the 2019 number with the 1.488 billion. That's assuming that probably 80% of the 150 million Chinese travelers, those going outside of China, will be back by the end of this year.

What you have on the right side is kind of different in the reading, but probably more interesting because you can have greater takeaways from it is the -- very much discrepancy depending on the region in terms of the international travel recovery. Middle East was already in the last 12 months far better than pre-COVID with those of you who've been going to the Middle East the last 12 months. We've never seen so many tourists, so many people, so many new openings, both in terms of restaurants, entertainment and of course hotels.

Africa, still 4% negative, but some of you have been seeing the numbers for the GDP growth in the Sub-Saharan African countries, it's very robust for the last 12 months and very robust for the next 12 months, certainly in Nigeria. Europe, still lagging minus 6% and of course Asia-Pacific, I talked to you about it, minus 35%. That will be probably the bar which should go back at par in the year ahead.

There's six different boxes and they are very different in nature in terms of what are the fundamentals helping us to assess the RevPAR growth for the next 12 months to 18 months. The first, on the GDP growth, many of you have seen the numbers, it was 2.9% for the world in 2023, looking in between 2.9% and 3.1% for 2024 and kind of confirmation of likely to be a soft landing as opposed to harsh landing in America. But what's so important for me is not only the average number, I think it's one of those times for the last two years where we've never seen so much discrepancy, not only from one continent to the other continent but within the same continent enormous discrepancy in between countries.

And many of you in a room, you understand that the pace of growth for the Northern Europe for the last 12 months and the next 12 months is very different from the pace of growth in Southern Europe in between 1% to 3%, and France just confirmed a 1% growth in 2024, revising downwards from 1.4% to 1%. But you still have Spain, Greece, Italy fetching probably well above 2%. So, it's watch out, because we're going to be navigating through a lot of different waters depending on where we sit....

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