November 27, 2018 / 6:48 AM / 20 days ago

AccorHotels sticks to goals for future earnings growth

PARIS (Reuters) - AccorHotels (ACCP.PA), Europe’s largest hotels company, on Tuesday reaffirmed its financial targets for future earnings growth helped by acquisitions and cost controls.

FILE PHOTO - The logos of AccorHotels group is pictured during a news conference at the Pullman Bangkok King Power hotel, in Bangkok, Thailand, June 15, 2017. REUTERS/Athit Perawongmetha

The business performance of Accor, whose brands include upmarket chains such as Raffles and Sofitel as well as budget brands such as Ibis, has benefited from recent acquisitions and a general pick-up in the broader French tourism sector.

Accor stuck to its target of doubling earnings before interest, tax, depreciation and amortization (EBITDA) to the 1.2 billion euro ($1.36 billion) level by 2022.

It also said it expected cost controls and stable capital expenditure levels to boost cash-flow and future dividends.

Accor’s bullish outlook contrasts with U.S rival Marriott (MAR.O), which this month cut its fourth-quarter forecast due to weak demand in north America. Hilton (HLT.N) also hinted at signs of a slowdown.

In October, Accor made a slight increase to previous guidance regarding its 2018 profits, with events such as this year’s Ryder Cup golf tournament boosting visitor numbers to its French hotels.

Accor also said this week it would buy full control of Polish hotels company Orbis (ORBP.WA), further highlighting the company’s appetite for takeovers.

“Our targets are ambitious yet achievable. AccorHotels is more agile, more profitable, and more global, with a well-balanced brand portfolio,” said Accor Chairman and Chief Executive Sebastien Bazin.

Previous acquisitions under Bazin, who took over in 2013, include London’s Savoy Hotel, The Plaza in New York, the Raffles Hotel in Singapore and Australian hotel group Mantra.

($1 = 0.8824 euros)

Reporting by Sudip Kar-Gupta; Editing by Michel Rose and Edmund Blair

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