French hotel giant Accor plunges into red as virus hits

French hotel giant Accor said Wednesday it plunged into the red last year as the coronavirus pandemic devastated the hotel and hospitality business worldwide.

Ranked number six globally, Accor reported sales down some 60 percent at 1.6 billion euros ($1.95 billion), producing a net loss of just under 2.0 billion euros. Analysts surveyed by Factset and Bloomberg had expected revenues of 1.85 billion euros and a net loss of 1.26 billion euros.

The company, which runs chains such as Ibis, Sofitel, Novotel, Mercure and Pullman, has seen its business devastated by the pandemic which has brought international travel and the hospitality and tourism sectors to a virtual halt.

Revenue per room collapsed by 62 percent for full year 2020 and was down more than 88 percent in the second quarter at the height of the first wave.

“This unprecedented fall reflects the global deterioration in the business environment caused by lockdowns and the closing of international borders in an effort to curb the pandemic,” Accor said in a statement.

Accor noted that after the pandemic battered results in the second quarter of the year, there was a noticeable pick-up in the third quarter in all regions as economies re-opened over the summer holidays.

This recovery however then came to a halt as governments re-introduced restrictions to cope with a fresh upsurge of coronavirus cases.

Accor said it hoped for better times this year as vaccination programmes allow an easing of restrictions, although caution “unfortunately remains the watchword” given uncertainties about how the pandemic will develop.