European hotel giant reports sales plunge

(Ronald Sumners)

Europe's biggest hotel group Accor on Thursday reported sales dropped 8.4 percent in the third quarter to 1.85 billion euros (2.76 billion dollars) amid a decline in travel during the economic crisis.

Accor's hotel revenue plunged 10.4 percent in the third quarter.

Accor senior executive vice president Jacques Stern told reporters that the group "does not expect a rebound in its activity at the beginning of 2010."

Stern said there had been more demand for organising conferences and seminars in the third quarter but added that this had not led to more bookings.

The French group said it was sticking to its target operating profit for 2009 of between 400 million and 450 million euros but said would also increase its cost-cutting plan from 120 million euros to 150 million euros.

Over the first nine months of the year, Accor's turnover fell 8.9 percent compared to the same period last year to 5.29 billion euros. Hotel revenue dropped 10.7 percent in that period, with upmarket hotels particularly hard hit.