Accor has announced that due to the COVID-19 pandemic more than half itshotels worldwide are closed, and likely more than two thirds will shutter in the coming weeks.The abrupt deterioration in the situation has prompted the group to take drastic actions across its global operations. These actions are indispensable to limit the impact on earnings and cash, and necessary to prepare for the post-crisis recovery, the company said in a news release.
As part of its mitigation measures, Accor has implemented a company travel ban and hiring freeze, reduced schedules and/or furloughed 75 percent of global head office teams for the second quarter, and reviewed its recurring investment plan for 2020. The group is further streamlining all other costs (sales, marketing, and IT, for example), in line with lower systemwide revenues.
Accor will also withdraw its proposal for a 2019 dividend payment. After consulting with the main shareholders, JinJiang International, Qatar Investment Authority, Kingdom Holding Company, and Harris Associates, Accor has decided to allocate 25 percent of the planned dividend to the launch of the ALL Heartist Fund, a COVID-19 special purpose vehicle. This fund will typically assist: the group’s 300,000 employees, pledging to pay for their COVID-19-related hospital expenses for those who do not have social security or medical insurance, on a case by case basis; furloughed employees suffering great financial distress, on a case by case basis; and individual partners facing financial difficulty. In addition, Accor will further deploy its solidarity initiatives to support frontline healthcare professionals and nonprofit organizations.
Photo: Courtesy of Accor