Accor, Europe’s largest hotel operator, said 2013 profit rose 1.9 per cent on cost cuts and a hotel-industry recovery.
Earnings before interest and taxes rose to €536 million from €526m a year earlier, the Paris-based owner of the Sofitel and Ibis brands said in a statement on Thursday. That beat the average estimate of €528.3m from 18 analysts surveyed by Bloomberg and the company’s target of €530m.
“While the economic environment remains uncertain in a few regions, overall we are benefiting from the global recovery,” chief executive Sebastien Bazin said in the statement.
Accor in November scrapped a plan to sell properties and expand through operating more hotels, focusing instead on owning the hotels it runs. The strategic change was Accor’s first since Bazin took office in August after the company fired his predecessor.
The company in January said its 2013 earnings would be at the top of its target, at about €530m.
Accor reported annual net income of €126m compared with a year-earlier loss of €599m that was caused by the sale of its Motel 6 chain. Accor plans to raise its dividend to 80 cents a share from 76 cents.
The company sold hotels valued at about €336m in 2013, Bazin said by phone. Accor has about €2 billion of cash to make acquisitions, although some of the funds may be used to pay back €2.3bn of debt that expires between 2017 and 2021, he said.
This year’s earnings will be boosted by the company’s new strategy of running its hotel operations and hotel investment businesses as separate units, Mr Bazin said.
“The strategy will take time to be implemented, certainly at HotelInvest, because of the size of the portfolio,” he said.
Accor said in November it plans to make most of its acquisitions in Europe, where there is high demand for budget and mid-scale properties.
The company opened 22,637 rooms in 2013, bringing the total number of rooms it operates to 461,719, the company said in January.
