The UK operator of Accor’s Novotel, Pullman, and Mercure brands demonstrated a strong return to profitability in 2023, with the Ibis division showing particularly notable gains according to recent financial filings.
Recently published results indicate substantial growth in both turnover and profit for Accor UK’s Business & Leisure Hotels and Economy Hotels divisions. Specifically, the filings reveal increased occupancy rates and revenue per room over the last year.
The Accor UK Business & Leisure Hotels division, which manages Novotel, Pullman, and Mercure brands, reported a significant increase in turnover, rising from £239.5 million to £282.3 million. This division also transitioned to a pre-tax profit of £12 million, a remarkable turnaround from the previous year’s pre-tax loss of £9.1 million. The average number of employees in this division increased from 1,558 to 1,778. By the end of 2023, the division operated 28 hotels in the UK, encompassing 5,587 bedrooms. The occupancy rate saw an improvement from 70.93% to 79.89%, while the net average room rate rose from £128.14 to £136.29. Furthermore, a dividend of £20 million was paid to the parent company, although no dividend was issued by the Ibis arm.
Accor’s Ibis hotel chain also posted notable increases in both sales and profits. The UK Economy Hotels division reported a rise in turnover to £251.8 million from £218.2 million, with pre-tax profits jumping from £23 million to £36.2 million. The turnover generated from room bookings grew from £195.3 million to £224.4 million, and revenue from food and beverages increased from £19.1 million to £22.7 million. The average number of employees in this division grew from 1,077 to 1,119. By the end of 2023, Accor UK Economy Hotels operated or leased 61 hotels, providing a total of 9,400 bedrooms. Occupancy rates improved from 74.15% to 77.37%, and the net average room rate increased from £76.20 to £84.37.
It is important to note the broader context within which these results were achieved. The parent company’s strategic decision to sell 18 hotels in exchange for three real estate properties previously operated, significantly influenced the financial outcomes. This deal included the transfer of Accor UK Economy’s interest in Ibis Heathrow to a subsidiary. Additionally, the wider Accor group reported a revenue of €5 billion for the same financial year, up from €4.2 billion in 2022, with an 11% increase in revenue to €2.677 billion in the first half of 2024 compared to the first half of 2023. The group’s EBITDA saw a 13% rise, amounting to €504 million.
The 2023 financial year has underscored Accor UK’s robust recovery and strategic growth, particularly within its Ibis division, amidst broader positive trends for the parent company.