Accor Sales Boosted by World Cup

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. October 14, 2008

PARIS, France, July 21, 2006. Accor's first-half sales rose 8.4 percent t 3.690 billion euros ($4.65 billion). This was helped by an ongoing recovery in its core hotels business.

Sales also got an added boost from the World Cup soccer championships in Germany, the company said. Business expansion accounted for 3.6% of growth while asset disposals had a negative impact of 3.4%.

The increase in like-for-like revenue over the first half reflects a good performance across all businesses and regions. The Hotels business benefited from a solid recovery in Northern Europe (Germany, Benelux and the United Kingdom), led by Germany. Although growth was more moderate in Southern Europe (France, Spain and Italy), signs of an upturn were apparent in the second quarter especially in France. Revenue from Economy hotels in the US continued to deliver sustained growth in the first half. The Services business again reported excellent revenue growth.

Hotels

Growth accelerated in the second quarter compared to the first. Adjusted for the positive impact of the soccer World Cup and Easter vacation, revenue rose 5.6% in the second quarter and 4.6% in the first three months of the year.

Upscale and Midscale Hotels

First-half revenue in the Upscale and Midscale segment increased 5.2% as reported and 5.7% like-for-like.

In Germany, like-for-like revenue growth came to 10.4%. Excluding the impact of the World Cup, the increase was 7.3%, reflecting a more favorable economic environment. Business conditions were also more favorable in Benelux, where revenue rose 6.0% like-for-like. In the United Kingdom, particularly strong business in London lifted like-for-like revenue by 7.5%.

Activity in France picked up speed over the period, with like-for-like revenue up 0.9% in the first quarter and 3.0% in the second, for a total gain of 2.1%.

Economy Hotels (outside the United States)

In the Economy segment (excluding the US), revenue rose 8.7% as reported and 4.7% like-for-like.

The World Cup fueled the 7.7% like-for-like increase in Germany. Factoring out this event, first-half revenue was up 4.3% thanks to the good business environment. In Benelux, like-for-like revenue growth came to 9.3%.

In France, stronger demand led to a 3.1% gain over the period, with like-for-like revenue up 1.8% in the first quarter and 4.1% in the second.

Economy Hotels in the US

Growth continued in this segment, with revenue up 6.0% like-for-like. The upward trend tapered off slightly at the end of the period, in an environment shaped by higher oil prices. The positive currency effect accounted for 4.8 points of the 9.9% rise in reported revenue.

Services

The Services business again turned in an excellent performance, with revenue up 25.6% as reported and 16.3% like-for-like.

Product range extensions made a significant contribution to growth. Examples include the Ticket Emploi Service in Belgium (like-for-like revenue up 22.5%), the Childcare voucher in the UK (up 21.1%) and the Ticket Car in Mexico (up 21.1%).

Increase of penetration rates also made a contribution to revenue growth. For instance in Venezuela, revenue rose 40.7% like-for-like.

Business expansion accounted for 4.7% of reported growth, mainly through four recent acquisitions: Hungastro in Romania (meal vouchers), Delicard in Sweden (gift vouchers), Stimula in France (gift vouchers) and Commuter Check in the United States (transportation vouchers).

The currency effect added 5.9 points to revenue growth and primarily reflected the appreciation of the Brazilian real against the euro.

Accor, European leader in hotels and tourism, global leader in corporate services, operates in nearly 100 countries with 160,000 employees. It offers to its individual and corporate clients nearly 40 years of expertise in its two core businesses:

• Hotels, with the Sofitel, Novotel, Mercure, Suitehotel, Ibis, Red Roof Inn, Etap Hotel, Formule 1 and Motel 6 brands: over 4,000 hotels and 475,000 rooms in 90 countries, as well as strategically related activities, such as Lenotre;

• Services to corporate clients and public institutions: 21 million people in 35 countries benefit from Accor Services products - meal and food vouchers, people care, incentive and loyalty programs.