2018 COMBINED SHAREHOLDERS MEETING Friday, April 20, 2018 Sbastien - PowerPoint PPT Presentation

2018 COMBINED SHAREHOLDERS’ MEETING Friday, April 20, 2018

Sébastien Bazin Chairman & CEO SO/ Bangkok, Thaïlande

François Pinon Group General Counsel & Board Secretary Pullman Park Lane, Hong Kong

Jean-Jacques Morin CFO Ibis Styles Singapore On Macpherson, Singapour

2017: Another year of record results Gross Volume EBIT Rec. FCF Revenue EBITDA € 435m € 18bn € 1,937m € 626m € 492m x2 +10.1% +19% +7.9% +8.1% Excl. Forex L/L L/L L/L ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 6

Strong revenue growth in all segments 2016 Variation HotelServices 2017 In € m In € m Reported L/L Gross volume at € 18bn, up 19% excluding currency effect HotelServices 1,524 1,746 +14.6% +5.1% 44 100 N/A +6.9% New Businesses AccorHotels Revenue Hotel Assets 599 616 +2.9% +7.0% Variance between L/L and reported Holding & Intercos (520) (525) N/A N/A driven by FRHI and New Businesses AccorHotels 1,646 1,937 +17.7% +7.9% ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 7

A record opening level in 2017 with more than 300 hotels Openings by segment Openings by region (in % of rooms) (in % of rooms) 16% 20% Rixos South 6% Luxury & Upscale 16 hotels America France & Switzerland 7k rooms 1% BHG NCAC >1/3 21 hotels 23% Luxe & 3k rooms Haut de Europe 31% Gamme Midscale Organic 264 hotels 38% 16% 41k rooms ASPAC MEA 49% Economy ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 8

Continuing consolidation of our market shares (At December 31, 2017 – in rooms) 169k Network 152k 4,283 28k Hotels 24k 3k 616k 8k Europe 168k Rooms NCAC France & Switz. 99 75k Countries 52k 48k 33k Pipeline 19k ASPAC 874 Hotels MEA South America 161k Rooms ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 9

MGallery London Leicester Square United Kingdom

Novotel Singapore On Stevens Singapore

Pullman Zhouzhuang Resort & Spa China

ibis Bangkok impact Thailand

Jo&Joe Hossegor France

Rixos Premium Dubai United Arab Emirates

Fairmont Royal Palm Morocco

Solid increase in operational results HOTEL NEW HOTEL HOLDING & (in € m) SERVICES BUSINESSES ASSETS INTERCOS Revenue 1,746 100 616 (525) 1,937 EBITDA 656 (25) 96 (101) 626 EBITDA margin 38% N/A 16% N/A 32% 2017 EBIT 576 (33) 50 (100) 492 EBIT margin 33% N/A 8% N/A 25% Revenue 1,524 44 599 (520) 1,646 EBITDA 524 (23) 78 (72) 506 EBITDA margin 34% N/A 13% N/A 31% 2016 EBIT 467 (25) 36 (81) 397 EBIT margin 31% N/A 6% N/A 24% ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 17

New Businesses crossed the € 100m in Revenue 100M € Revenue 10% Underlying L/L growth (rebased 12 months) Stable EBITDA Breakeven by 2019 confirmed Gekko acquisition closed in January ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 18

(In € m) 2016 2017 Stable revenue reflecting: - Asset management strategy including Revenue 3,986 3,985 HotelF1 and renovation programs - Offset by sound operating momentum EBITDA 533 522 in Europe EBIT 300 522 Depreciation stopped as per IFRS 5 Income before tax 188 410 Income tax and minority (84) (342) € 195m tax impact from the creation of AccorInvest Net income 104 67 ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 19

An improving debt profile 4.6 5 6.51% 4.5 4.2 4.5 5.37% 3.5 3.6 4 AccorHotels is 3.5 committed to 2.9 2.8 4.28% 3 Investment Grade 3.11% 2.5 2.89% 2.85% 2 2.04% S&P & Fitch 1.5 ratings both 1 at BBB- 0.5 0 2011 2012 2013 2014 2015 2016 2017 Rate Maturity (in years) ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 20

2017 Proposed Dividend 2016 2017 Profit before non-recurring items, 469 538 net of tax (1) (in € m) Profit before non-recurring items, 1.81 1.87 net of tax per share (in € ) Ordinary Dividend per share (2) 1.05 1.05 (in € ) Ordinary Dividend 299 302 (in m € ) Payment in cash (1) Operating profit before tax and non-recurring items, less operating tax, less minority interests (2) DPS is defined as Net Profit attributable to shareholders divided by the number of fully diluted weighted number of shares, i.e. 288m in 2017 vs 260m in 2016 ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 21

Q1 2018 Revenue Q1 2017 Change Q1 2018 HotelServices Reported L/L In € m In € m Gross volume at € 4.1bn, up 9% excluding currency effect HotelServices 563 553 -1.8% +7.7% New Businesses 13 31 N/A +14.5% Hotel Assets & Other 164 157 -4.2% +7.5% AccorHotels Revenue Holding & Intercos (111) (108) N/A N/A Variance between +9.5% L/L and AccorHotels 629 633 +0.6% +9.5% +0.6% reported driven by strong depreciation of USD & AUD 745 745 Future Financials ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 22

AccorHotels share performance vs. CAC 40 125% 115% 45.00 € AccorHotels +14% depuis 1 an 5,077 pts 105% CAC 40 +6% depuis 1 an 5,392 pts 39.55 € 95% April 2017 October 2017 April 2018 ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 23

Sébastien Bazin Chairman & CEO Sofitel Luang Prabang, Laos

Ready to seize a new growth phase Strong value Financial Digital Segment Asset-light AccorHotels M&A creation at profile initiatives positionning model Stronger successful AccorInvest improved recognized revamped than ever transition ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 25

Strong profitability improvement (including AccorInvest) +8% CAGR 765 696 665 602 526 521 515 449 12.9% 12.4% 11.9% 11.0% 9.6% 9.3% 9.3% 8.4% 2010 2011 2012 2013 2014 2015 2016 2017 EBIT ( € m) EBIT margin (%) ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 26

An optimized portfolio Luxury : +19 pts in 4 years Emerging : +7 pts in 4 years 8% 41% 5% South America Luxury & NCAC Upscale 25% 27% France & Economy Switzerland 27% ASPAC 27% 32% 8% Europe Midscale MEA 2017 Fees by segment 2017 Room Portfolio by region ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 27

Solid infrastructures to support high growth CLIENTS 41m 9m A SINGLE APP +70% Loyalty members Price updates per day X2 vs 2014 vs 5m in 2014 Revenue vs 2016 HOTELS 968 X4.5 1.7 Sollicitations Ratio “Look -to- book”* Booking/Second per booking in 2017 since 2014 ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 28

Acquisitions: € 6.3bn in 4 years mainly in hospitality 2014-17 Non-recurring Capex ( € bn) & % of total Investments since 2014 HOTEL 3.7bn 60% SERVICES HOTEL 2.0bn 30% € 2bn hotels assets acquired ASSETS NEW 0.6bn 10% BUSINESSES ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 29

Disciplined investment policy • Extend and secure our existing leadership • Accelerate our development in specific markets and/or segments • Complement service offering to guests and partners HOTELSERVICES • Favor mid-size targets • Respect strict financial criterias • Multiply touchpoints • Client retention NEW BUSINESSES • Acquire data driven know-how • Protect Corporate Travel ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 30

AccorHotels is stronger than ever Powerful brands Pipeline Gross volume In K rooms +50% In € bn X2 X2 18 25 161 112 9 13 2012 2017 2012 2017 2012 2017 System growth Yearly openings Market Cap. In K rooms In K rooms In € bn +37% +35% X2 13 616 41 450 30 6 2012 2017 2012 2017 2012 2017 ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 31

AccorInvest CREATE ACCORINVEST OPEN ACCORINVEST AN INDEPENDENT LEGAL ENTITY TO INVESTORS 55% 45% Long term institutional investors ACCORINVEST HotelServices MAJORITY OF Management Brands owner, hotel HOTELINVEST ASSETS agreements operator & Owned & Leased digital player Asset owner ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 32

Key transaction parameters CA PIF GIC Assurances CLNS Amundi Autres 45% 55% € 6.25bn € 4.4bn Q2 2018 Enterprise value Cash for AccorHotels Expected closing ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 33

Long term relationship with AccorInvest Dividends Management Agreements Fully funded vehicle 5% dividend yield based on € 3.6bn debt financing secured 30 to 50 years duration including undrawn lines to transaction NAV execute 2017-2021 Plan AccorHotels representation Fees Liquidity rights Voting rights capped at 30%  Ability to sell down to New fee structure for a better alignment 30% ownership  5-year lock-up on 30% ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 34

€ 4.4bn of cash available 1 2 3 € Return to shareholders Preserve Tactical M&A strategy investment grade status Objective to buy-back & up to € 1.350bn Increase balance sheet of share capital flexibility (c.10% of current market Cap.) ACCORHOTELS / COMBINED SHAREHOLDERS' MEETING April 20, 2018 / 35