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Accor's soft outlook offsets revenue jump, shares sink 9%

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·2-min read
FILE PHOTO: The logo of French hotel operator AccorHotels is seen on top of the company's headquarters near Paris
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By Charlotte Lavin and Diana Mandia

(Reuters) -Europe's biggest hotel group Accor's shares sank more than 9% on Thursday after giving a disappointing 2022 profit outlook that overshadowed a big jump in half-year revenue.

The company said it expected to report full-year core earnings (EBITDA) of more than 550 million euros ($561 million), compared with 22 million last year, after its second-quarter revenue per available room (RevPAR) exceeded pre-COVID levels for the first time.

"We had expected more than 600 million euros given the strong recent data, so the guidance is either conservative on RevPAR (implied negative in H2) or factors in further cost or marketing pressure," analysts at Morgan Stanley said.

Bernstein analyst Richard Clark also deemed the EBITDA target "soft", saying he had believed 700 million euros would be possible, while Alpha Value analyst Yi Zhong pointed to rising labour costs driven by the increase in minimum pay and labour shortages.

Barclays and Stifel said core profit of 205 million euros in the first half of the year was "disappointing".

Accor's shares were down 9.3% at 26.01 euros in afternoon trading.

Accor has tried to mitigate the severe staff shortages plaguing the hospitality sector by hiring employees with no experience, after thousands of workers left the sector during the coronavirus pandemic.

"Filling a hotel means having the staff to actually serve that hotel. But today, we don't have the staff," Chief Financial Officer Jean-Jacques Morin told reporters.

The company, which runs high-end chains Sofitel and Pullman and budget brands such as Ibis, also flagged a continued impact from the strict enforcement of China's "zero-COVID" policy, as the Southeast Asia region is highly dependent on Chinese visitors.

A rebound in all regions and for all its brands drove Accor's revenue to 1.73 billion euros in the first six months of the year, up from 545 million a year earlier.

Accor still expects to increase the number of hotels in its network by 3.5% this year, it said.

($1 = 0.9805 euros)

(Reporting by Diana Mandiá and Charlotte Lavin; editing by Milla Nissi and Bernadette Baum)

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