UPDATE 2-Accor eyes 2010 core profit rise, shares up

* Taps into recovery in business travel

* H1 EBIT 154 mln eur vs 69 mln eur yr-ago

* Eyes 2010 EBIT between 370 mln eur and 390 mln eur

* Sets new debt reduction goal for 2010

* Shares up over 6 pct as debt, EBIT guidance please

(Adds CEO comments, share reaction, analyst comments)

By Dominique Vidalon

PARIS, Aug 26 (BestGrowthStock) – French hotel group Accor (ACCP.PA: )
tapped into recovering global demand for rooms and business
travel with a doubling of core profit in the first half and
forecast significant earnings growth for the full year.

Although the economic climate was uncertain, the world’s
fourth-largest hotel chain forecast earnings before interest and
taxes (EBIT) would rise to between 370 million and 390 million
euros in 2010 from 236 million ($299 million) in 2009.

The guidance was above analyst expectations and, coupled
with news Accor was ahead on plans to sell assets to cut debt
and on cost savings, drove up its shares over 6 percent.

Earlier this month InterContinental Hotels, the world’s
biggest hotelier, was upbeat after room occupancy levels rose
through the first half and room rates turned positive in July,
echoing strong results from rivals Marriott (MAR.N: ) and Starwood
(HOT.N: ) in the United Sates. [ID:nLDE6790MX]

Accor Chief Executive Gilles Pelisson told a conference call
that the hotel business trend for September was “rather good”,
notably from core business clients in Europe.

“We have less visibility over the end of the year and thus
remain cautious,” he added.

First-half EBIT rose 120 percent to 154 million euros on a
pro-forma basis, under which on-board catering unit Wagons-Lits
and casino group Lucien Barriere have been reclassified as
assets for sale, the company said.

Last month Accor, with hotels in 90 countries ranging from
the luxury Sofitel chain to budget Ibis and Motel 6 operations,
posted a 6.1 percent rise in first-half sales as a recovery at
its midscale and upscale hotels gathered pace. [ID:LDE66JOR7]


By 0714 GMT, Accor shares gained 6.38 percent at 25.05
euros, outperforming a 1.22 percent in the European travel and
leisure sector (.SXTP: )

“Very strong first-half results and guidance 15-20 percent
above consensus,” said Credit Suisse analysts in a note.

CM-CIC analyst Kim-Anh Bassot said that a prediction of a
sharp reduction in 2010 net debt was also “good news”.

Accor was reporting its first set of earnings since the
spin-off of its Edenred (EDEN.PA: ) vouchers business on July 2.

Accor has split into separately listed hotel and service
voucher businesses to boost growth and expand abroad, and its
management believes the group’s activities will be better
valued. [ID:nLDE65S09C]

Accor took on 1.2 billion euros of the group’s 1.6 billion
euros of debt following the Edenred spin-off and plans to shed
further assets to cut debt.

Earlier this month, Accor sold a 60 percent stake in

It is also planning to dispose of its 49 percent stake in
casino group Lucien Barriere. A decision on whether to list the
company on the stock exchange will be taken soon, Accor said.

Accor, which earlier this week said it was ahead on its 2010
plan to sell assets to cut debt, unveiled a new goal on Thursday
to reduce adjusted net debt by 600 million to 650 million euros
this year.

Accor has also now already achieved over 50 percent of its
45 milllion euros goal in cost savings for 2010.
($1=.7901 Euro)
(Editing by David Cowell)

UPDATE 2-Accor eyes 2010 core profit rise, shares up