2014 Registration Document and Annual Financial Report - page 162

2014 Review OF THE YEAR
Reportontheparent companyfinancial statements for theyearendedDecember31,2014
4
4.2. REPORT ON THE PARENT COMPANY FINANCIAL
STATEMENTS FOR THE YEAR ENDED
DECEMBER 31, 2014
ACTIVITIES OF ACCOR SA
Accor SA owns the Pullman, MGallery, Novotel, Suite Novotel,
Mercure, ibis, ibis Styles, ibis
budget
and HotelF1 brands, and
receives royalties from their licensing. It also owns hotel businesses
in France and holds most of the hotel management contracts and
franchise agreements in the country.
Accor SA provides other Group companies with hotel management,
purchasing, cash management, IT and advertising services, as well
as various advisory services, and assigns staff to them as required.
Billings for these services correspond either to a percentage of
the hotel’s revenue and/or profit, either as a flat fee or a fee per
service. They are determined on an arm’s length basis.
As the Group’s holding company, Accor SA manages a substantial
portfolio of equity interests, receives dividends from subsidiaries
and leads the Group’s expansion.
At December 31, 2014, 61 hotelsweremanaged by French subsidiaries
under business leases: three Sofitel, 40 Novotel, 11 Suite Novotel,
four Mercure, two ibis, one ibis Styles, and one ibis
budget
.
Review of 2014 results
Revenue
from all of the Company’s operations amounted to
€825.3 million in 2014,
versus
€807.3 million the year before. The
2.2%, or €18 million, increase reflected the €13.2 million rise in
services provided by Accor SA (corporate services, purchases,
technical support, etc.) as well as the €8.3 million increase in fees
billed to non-related parties, which offset the €7.0 million decline
in rental income and debt guarantee fees due to the ongoing
deployment of the Group’s asset-right strategy.
Revenue includes hotel royalties, rental and business-lease revenue
and service fees.
Accor SA revenue by source
(inmillions of euros)
2013
2014
% of total
Royalties from subsidiaries
359
363
44%
Services fees
(1)
250
263
32%
Rental and business-lease revenue
74
68
8%
Royalties from non-Group companies
115
123
15%
Guarantee fees
9
8
1%
TOTAL
807
825
100%
(1) Services provided by Accor SA include corporate services, purchasing, technical support, accounting fees and back-office systems.
At December 31, 2014,
provision reversals, expense transfers and
other income
amounted to €85.7 million compared to €55.2 million
in December 2013.
The €30.4 million increase primarily reflects the reversal of
€30.7 million in provisions for restructuring, as well as €16.9 million
in expense transfers relating to bond issues, which were offset in
2014 by a reduction in pension provision reversals in the amount
of €14.6 million.
Operating expenses
stood at €852.0 million at December 31, 2014
compared to €852.6 million at end-December 2013.
The €0.6 million dip was primarily due to a €28.0 million reduction
in additions to provisions, a €10.6 million reduction in payroll costs
and a €6.8 million reduction in operating expenses.These declines
were offset by increases of €16.9 million in distribution fees,
€16.9 million in bank fees relating to bond issues and €12.8 million
in project royalties.
Operating profit
stood at €58.9 million in 2014 compared to
€9.9 million in 2013, an improvement of €49.0 million.
Net financial income
came out at €169.1 million compared to
€46.4 million in 2013, up €122.7 million, mainly as a result of an
increase in dividends from subsidiaries.
Total provision movements
included in net financial expense,
corresponding mainly to write-downs of investments in subsidiaries,
represented a net expense of €44.8 million in 2014 against net
income of €14.8 million in 2013. In 2014, the most material additions
to these provisions concerned the shares of Accor Partecipazioni
Italia (€29.8 million) and Belle Rivière Hotel (€16.1 million).
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Registration Document 2014
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