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Intrinsic Value is all-important and is the only logical way to evaluate the relative attractiveness of investments and businesses.
Bonjour, and good morning, everyone. Thank you for being connected with us. Jean-Jacques Morin is on my right.And we're going to be spending the next 90 minutes until 10 o'clock Paris time on announcing and sharing with you great results for 2022, extremely solid. Very happy to go through it. Happy probably, and I'll do it now to tell you that, yes, we are enjoying a nice month of January in terms of activities and likely looking forward for 2023, which is going to be an even better year of 2022.So I'm going to start with the first slide, which is a bit 20,000 feet altitude. I wanted to show you in between the kind of bearish environment, which was the case in October 2022. When it comes to inflation, the same person probably as economist in the world, what they have said in January 2023, which is 3 months, 90-days lag. Clearly, when it comes to inflation, inflation is still there, but no longer rising and the fear was probably to go much higher than where we are now. You see it for the U.S.A., it's still 50 basis points from 3.5% to 4%, but it is stabilizing in Europe at 5.7% and in the world between 6.5% and 6.6%. You've seen over the last 20 days a lot of raw materials, steel, copper being sharply down for the last 45 days, and some of them being looking to be lower than 2019.And on the GDP growth, which you have on the right side, it is a more bullish environment in terms of outlook with the U.S.A. gaining 40 basis points from 1% to 1.4%, Eurozone coming out from stagnation from 0.5% to 0.7%, and the world enjoying 2.7% to 2.9%. And you know I'm traveling quite a bit. And when you go to Singapore today, when you go to the Middle East and many other places, I must say they have a very robust environment.Go a bit deeper on hospitality at large. There's two things which are very different in nature, which is of no surprise, but we need to pay attention to this. On the left side is the domestic travel. Many of you know that, I guess, 2022 have enjoyed a very nice V-shape rebound with the numbers at the end of the year, which is actually higher than the performances of 2019. Most of it being leisure and you've seen the numbers in America, you've seen the numbers in Southern Europe for Accor and France, which is clearly higher than 2019, and I'm probably looking forward to be record number in terms of domestic travel for the years ahead. That is not the case for international travel.It is still 37% down versus 2019. You know that number of [ 1.5 million ] travelers at the end of 2019. I just want to remind any of you that part of that 1.5 million travelers -- 1.5 billion, sorry, you have two large population. The two largest emitting market in terms of numbers of travelers happens to be America and China. You have roughly 150 million Americans traveling outside of America. And you have the same 150 million Chinese traveling outside of China in 2019.Guess what, many of the Americans are back. Almost 80% of that 150 million have been traveling in the 2022 environment. Zero Chinese travelers have been traveling over the last couple of years. That is the news of the last 45 days. It's very likely we're going to see and it's probably going to go sequentially, a lot of that 150 million people from China are traveling again.It's being starting and we've been acknowledging it in Southeast Asia in the hotels of Accor. Remember, 80% of the Chinese, when they do travel, they stay in Asia. They go to Hong Kong. They go to Korea. They go to Australia. They go to Southeast Asia. Still we've been missing them for the last few years and we're very happy to see them back, which is why that minus 37% maybe a very different number moving forward at the end of this year.That's what it is in terms of GDP, hospitality. I give the floor to Jean-Jacques on the Accor numbers, and then I'll get back to you on the conclusion.
Thank you, Sebastien. Good morning, ladies and gentlemen. Very happy to be with you for these results, which are, as you will see, nice results. As we did for all the 2022 presentation, we're going to provide RevPAR variation versus 2019 to ease the performance and avoid base effect. This is the last time we'll do that.And without further ado, let's go to the highlights of the financial year. I mean it's a momentous milestone because we ended up with an activity in 2022, which is above 2019. The RevPAR is basically 2% above 2019, and we ended the year very strongly with a Q4 RevPAR, which is, in fact, ahead, slightly ahead of the Q3 RevPAR, which we all knew was on the back of a great summer, notably in Europe.Moving to the second item here, which is the net unit growth. The last 12 months net unit growth finishes at 3.2%. The Zero-COVID policy in China did affect the domestic market, but it also affected globally the supply chain with the collateral effect on other regions. Nevertheless, our pipeline -- Accor pipeline continued to grow. We ended up at 216,000 rooms from 214,000 last year. And there is a sustained interest from hotel investors. The conversion, which is a nice weapon when capital maybe scarce, continue to be extremely high at 47% for the full year. The recovery translated into a global business volume of EUR23 billion, which is 5% above pre-pandemic levels. So the business volume includes the room, but also includes the [ family ].Moving to the high part of the table where you see, in fact, the detail of the result. Revenue is at EUR4,224 million, which is 80% increase versus financial year 2021, and 4% plus versus 2019. The EBITDA reaches a level of EUR675 million, well, basically at 0 last year and so it's a nice jump. And we are, in fact, beating the consensus by about 5%, the high-end of the consensus, which we provided at being somewhere between EUR610 million and EUR640 million back in October. And the reason for that is Q4, as I said, ended up being extremely strong. And so the dynamic into which we enter into 2023 is an extremely good momentum.All these profit falls nicely into cash. We've got a recurring free cash flow, which ended up at EUR373 million. And this brings us to conversion level between EBITDA to cash, which is very much what we had in the years pre-COVID. We are at about 55%, which is very much the norm on the business results and very much what we used to do in '18, '17, 2019. So nice drop-through of profit into cash. If we move to some more details of the top line by geography, what you see here and you see that very well with the orange bar is that the pricing power has remained extremely strong over the last quarters. We end up Q4 at prices, which are 25% above 2019 like-for-like.Going into each of the region, South Europe Q4 is 12% above 2019. It's a slight improvement versus Q3, as you can see. What is nice now is we had the recovery in South Europe that came from the Provence, but nowadays Paris and the Provence are at the same level and that translate, in fact, the return of international and European travelers to Paris.Northern Europe -- Northern Europe -- I'm not responding to phone calls. Northern Europe Q4 was 5% above 2019. There was a slight slowdown in Northern Europe, and this is due to Germany. The Germany RevPAR is slightly below 2019 level, and this is due to less events and low attendance. You know that the business in Germany is very much driven by fair and convention, and the German economy is one of the economy that suffered the most in Europe. However, the UK, did very well and remain extremely strong and with very good performance between Provence and London, and this despite the rail strikes, which at one point in time, could have been an issue.If you move to Asia Pacific, nice recovery. Q4 RevPAR remains negative, but you can see the curve and the speed at which things are progressing. Pacific, which is Australia, remains resilient. It has been resilient for many quarters. Greater China saw a deceleration. So, you don't see an improvement in the number Q4 versus Q3 in Greater China. We all know that the Zero-COVID policy is now over, and you will see the effect of that change in the numbers of 2023. And notably, in fact, because you know that the easing of the restrictions on the Chinese traveler has only really started in 2023, and we see that in the numbers of January and February.The one thing which is remarkable that I would quote, is that the domestic business in China in the Chinese New Year period, which was in January is at 90% of what it used to be in 2019. So, you see there that the domestic has recovered and is recovering, and that the next phase is the one that Sebastien mentioned, which is those 150 million of Chinese basically flooding into Asia as they would do as restaurants, they constitute about 50% of the business of any of their agent counterpart as the Chinese travel largely first start with Asia to the tune of about 90%.Southeast Asia is also recovering. I mean, we saw that already in the Q4 results -- in the Q3 results, sorry, with Singapore and Thailand, and this is continuing. I mean, again, Japan is now open. And so all of that is going in the right direction. That means that Asia Pacific ends up negative in Q4, but will be a springboard for upside in 2023.IMEAT, which is Middle East, Africa, Turkey, you see the numbers. They are amazing. RevPAR 73% in Q4. There is clearly here an effect, which is the Qatar Soccer World Cup. This has, obviously, boosted the Qatar number, but this is wider as some of the travelers, in fact, were staying in UAE, were staying in Saudi. So between the Dubai World Conference at the beginning of the year, the Expo, and at the end of the year on the soccer, Qatar game, you can see how wonderful the performance of IMEAT has been with a very strong pricing power.America has been very much recovering, as we all know from our peers. South America is doing extremely well. In the Americas, you've got North America and South America. South America for us is a significant amount of hotels, more than 400. And here, again, you see a very strong pricing power. And so all of that translates nicely.If you move to the next page, which, how it translate into revenue. Fundamentally, what's remarkable here is that both HotelServices and Hotel Assets ended up with a growth of the revenue versus 2019. So, it's spread across. Accor revenue at EUR4,224 million is, in fact, in reality an 80% number on like-for-like basis, but a 92% on reported numbers because it's boosted by the US dollar strength versus other currency. You've got the details in appendix.If you look at the HotelServices, you see the 5% increase versus 2019. HotelServices, in fact, made of 2 segments, as you know, M&F, which I will detail after and Services to Owner. And Services to Owner did benefit from the activity in Qatar. So it's showing a very nice increase of 8% versus 2019. As for Hotel Assets, you know that this is predominantly Australia, and it includes the Mantra business and to a smaller extent Brazil. And so Mantra continued to benefit, as I was mentioning before. Quarter after quarter, they have been doing good. They basically stopped the Zero COVID policy long time ago. And since then, they are having a nice ride, and it continued to be driven by the leisure demand in coastal area. And the Australian cities are recovering, but are still impacted by the lack of international and corporate guests. So again here, with the opening of China, with more airlines going into Asia, i.e., the capacity being basically recreated, those numbers will continue to improve.If you move to the next slide, which is giving you the detail of M&F. So that's the Management & Franchise, M&F. You've got it by geography versus 2019. You see that it is still a little bit behind, 1%, but the explanation remains the same over time. It's the residual lack of the incentive that we get from our owners for managing the properties. You've got 2 places where you are behind 2019, which is Asia Pacific and Northern Europe. So, you would expect that. The other regions are very much in line in terms of volume growth versus the RevPAR.And globally, which is in the end what matters because there is disparities, there is chunk of data, high [ inlet ] because of the geography that is ours. But overall we have incentive at 32% of the M&F revenue. Just as a reference, 34% was the number in 2019. So, we are basically back and this leverage is now back helping us in revenue generation. And you see the numbers versus 2021, which is a 93% increase.If I move to the EBITDA, so overall the group EBITDA. So it's moving from EUR22 million last year to EUR675 million this year. M&F, which is moving from EUR93 million to -- sorry, HotelServices moving from EUR93 million to EUR661 million. Out of that, M&F is moving from EUR274 million to EUR737 million. This is in the appendix, and it reflects the disruption that I just was mentioning on incentive. If you want to look at the details of this by regions, again, all of that is provided in the appendix.As for Service to Owners, this was a big discussion back in the H1 results. You may recall, we showed a loss of EUR89 million. We did tell you back in the Q3 publication that we would be returning to breakeven and we are at [ EUR14 ] million plus. So we did do what we said, which by the way also explains the EUR675 million of EBITDA for the group. And if you were to look at the H1 versus H2 EBITDA generation, you can see that H2 2022 EBITDA is in advance versus H2 2019 EBITDA. So, that was really an investment that was done in H1 to rebound from the minus 25% RevPAR that we faced with Omicron in order to ensure that the year will end up properly, and this is exactly what you see in those numbers. It did end up properly. Very well.So regarding Hotel Assets, EBITDA recovered to EUR137 million in financial year 2022. As I mentioned, this is largely Australia. These are the Mantra properties. And the number is, in fact, behind the number of 2019. But for, I would say, a very some reason that over time, we've reduced our lease exposure in Australia by renegotiating those leases and getting out of them as much as we could. So the gap in EBITDA is, in fact, something voluntarily in order to exit from an asset-heavy component of the business, which is the Mantra leases. Just as an illustration, the debt on the balance sheet from 2019 to 2022 has been reduced by 40% on those leases. And by the way, for the record, the new business EBITDA is positive.Moving to the EBITDA to net profit bridge, very straightforward bridge. We end up with a net profit of EUR402 million coming from an EBITDA of EUR675 million, not a lot of exceptional item. You see on the share of profit coming from associates and joint venture, the turnaround of AccorInvest. And this line is mostly the 30% ownership that we've got in AccorInvest. AccorInvest has been having a great year because they are in Europe and Europe has done well, as you saw in our numbers and they got the leverage of being an asset-heavy business. And so that's why you see this jump from minus EUR273 million to plus EUR33 million.The other line that is significant in term of delta is the non-recurring item, the EUR554 million that you see here last year, it was coming from the Huazhu share that we sold, and the gain recognition that was done in 2021, which you don't have that in 2022 and hence, the gap. And as far as the discontinued profit, you've got here another reversal coming from the disposal -- sorry, the contingency, sorry, that we took on the AccorInvest when we did the deal back in 2018. And as the risk did not materialize, we were able to reverse those provisions gradually.So moving to the recurring free cash flow. So from EBITDA to recurring free cash flow. Here again, a very clean and straightforward EBITDA to recurring free cash flow bridge. You see on the cost of net debt, slight improvement because our interest is decreasing. I'll get to that later on. You see that the recurring investment at EUR159 million is very much in the guidance. We had told you somewhere between EUR150 million to EUR200 million. We are at the lower end of that bucket.What will happen in 2023 is that -- reason why we are at the lower end is that some of the key money got postponed on some properties, and so you should expect 2023 to be slightly above EUR200 million. So over the 2 years, we will be within the guidance we provide, but with 1 year being at the low end and the other one being at the high end. The other remarkable point here is the working capital is super nominal, close to 0, which is exactly what we have always been targeting.The net debt, you see a reduction of EUR200 million on the net debt. Obviously, the activity helps and you generate EUR373 million of cash. Also we completed the full disposal of Huazhu in 2023. Part of it got executed in 2022 to the tune of EUR154 million. And hence, there is that element in the bridge. The third thing is that we sold 10.8% of Ennismore. You recall that in Q4 for EUR185 million. And this came -- and the offset to that is a debt increase related to the constitution of Ennismore into which you recall we bought some of the shares that we were not owning in Mama Shelter, 25hours and more importantly in Paris Society. And the net of all of that is this EUR200 million improvement on the net debt.Moving to balance sheet, some more on the balance sheet. You see that we fully benefit from the active balance sheet management that we've done over those years. I mean, we've been always actively managing the asset and liability of the company and you see a debt profile, which is a very sound liquidity at EUR2.8 billion. EUR1.6 billion is cash. EUR1.2 billion is a credit line.Our cost of financing is slightly down versus 2021 at 2.1%. And last but not least, we reiterate our commitment, as we've always done, to restore our investment grade rating that we lost with the COVID like everybody in the industry. And with this full-year result, we are basically now at the level of that grade rating, i.e. the ratio, notably, the debt coverage ratio is investment grade level. So, I think this is a very good piece of news. And again, we'll continue to further improve all of this situation.On the right side, you've got the debt profile that we put every year. One thing that I'd like -- 2 things, I'd like to say. First off, there is no significant maturity before 2026 and this is the IFRS debt schedule. So it does not include the hybrid debt, which you recall is to the tune of EUR1 billion in 2024-2025.Moving to something, which is important and that we have not highlighting enough in history, which is the extra financial reporting. So not only the numbers, but also what we do in matters of social and environment. I mean, we did set up ourselves a target. I mean, some of them, I mean, in the bonuses of the top management and Sebastien bonuses, and we've been meeting all of those targets.First off, carbon emission. There is a decrease of the so-called Scope 1 and 2 versus 2019. And this is in line with what we -- sorry, the SLB financing that we issued 1 year ago. And obviously, energy sovereignty measures and all of that is helping. The other one, which was a significant push because it impacted everybody was the single-use plastic. We've been able to remove [ 300 ] tonnes of plastic this year coming from single-use plastic, amenities notably and we are basically at a ratio of 84% of the hotel having removed those. So for those of you who travel, you clearly should see that, and this is something that we really want to continue to push.ESG training, I mean a lot of it is making sure that the head of the people is cleared up. And so there is here a school for change training that we've been having 97% of our employees complete. And last but not least, diversity and inclusion. One ratio here which is that 39% of our management committees are composed of women and this is an improvement versus 2021, which was an improvement versus 2020. So little by little, we're going exactly where we should be getting.Next slide is back to shareholder and what we do from those nice financials. We're going to resume dividend. Our dividend policy, as we all know, is that 50% of the recurring free cash flow is the yearly ordinary dividend. If you do that mechanical computation, it would give EUR0.71 per share, which is what you've got on the slide. Considering the disposal that we did this year with Ennismore and Huazhu, we -- the Board of Director decided to propose an additional exceptional dividend at the next General Assembly. And when you add up the 2, you would be at EUR1.05 per share, which for those who recall is exactly the level of dividend that was paid between 2017, 2018, 2019. And that translate into an absolute amount of EUR276 million.With this, I leave the floor to Sebastien for some concluding remarks.
Thanks a lot, Jean-Jacques.You being over time by 1 and 20 seconds, which, actually, it's a good transition. To talk about Jean-Jacques Morin, it's part of what you have on your slide here, which is the reorg. This is the last time Mr. Morin will be in front of view as Chief Financial Officer of this company, which is a bad thing because he is very, very good and....
I'm over time?
Yes, you being overtime by a minute and 20 seconds. And it's extraordinary time because you will be even better as a CEO of an enormous organization, which is 90% of the numbers of hotels of this group and roughly 2/3 of the cash flow, which is the Accor Midscale and Premium. It's a new life. It' a new adventure. It's a perfect timing for Jean-Jacques to go deeper into the organization.He is super excited about it. He probably doesn't show, but I can tell you he's just eager to start, which he did on 1st of January, which means that, I guess, we have been selecting a new Chief Financial Officer, who will be coming here early May. So until now and early May, we're going to be continuing as he does now to do kind of actually dual role looking at leading Accor Midscale & Premium, but of course, still looking after the numbers, but slowly transitioning to a full-time job. But again, you don't know how privileged and happy I was when we found you some 6 years ago, 7 years ago.
7 years. Yes.
7 years ago. The quality of the number, the quality of the reporting, the accuracy of the numbers, permits the group to be where it is. I and we owe a lot to you. So seriously, Jean-Jacques, I wish the next guy is going to be even better. I'm not sure, but it's going to be probably certainly as good, but [Foreign Language]So go on this new organization, we refer you to Turbo. Turbo was kind of a code name for accepting to reorganize the group in two autonomous independent division implemented 45 days ago on the 1st of January of this year, which resulted into luxury and lifestyle. I insist brand-led organization. Brand-led means you will have, and you have today, Raffles & Orient Express, New York headquartered with a new CEO by the name of Omer Acar.Fairmont transitioning over from Toronto headquarter to Dubai headquarter, Sofitel, MGallery. Emblems with Maud Bailly headquartered in Paris. Fairmont with Mark Willis. And then you have Ennismore, which is the lifestyle organization that we headquartered in London under the name of Ennismore a year and a half ago with Sharan and Gaurav. And I will take the leadership of that division. It's going very smoothly. People are extremely excited and the sense of ownership belongings is already there. So, we're going to have some very happy surprise on probably firming up brand promise social content, and of course, growth and margin.Same principles applies on Premium, Midscale, Economy, except it's not brand-led, it's geographic-led. And you have one Chief for Americas, Thomas Dubaere, headquartered in Sao Paulo, but covering the entirety of the Americas. You have Europe under the leadership of Patrick Mendes, the entire Europe, which includes Northern Africa. You have Asia Pacific, Middle East, India, headquartered in Singapore under the leadership of Duncan O'Rourke, and then you have Greater China, which is a single led organization with Gary Rosen.Again, leadership of that organization with Jean-Jacques. Jean-Jacques have met with them many times, so did I last time. I need to insist on how those organizations have been put in place. We kind of started mid-November because the numbers were solid for 2022, so permitted to gain some time. It is probably 10x better than I expected in terms of firmness, in terms of strength, in terms of possession. They know where they're going. And I think they want to surprise us and you on getting to better results and certainly greater focus, which was why we've done it, which is get people with the right expertise at the right time in front of client, owners.And which result in point number 4 here, which is, as you expected and as we should, the first semester numbers of 2023 will be reported accordingly. So, you will see by the end of July that each of the numbers that you show, that you've seen being represented to you very differently by Jean-Jacques 5 minutes ago, that will no longer be the case. You'll have 2 columns. You'll have a column for Luxury & Lifestyle and you have a column for Premium, Midscale and Economy. And that is perfect. It's going to give you better clarity.What we're likely to do, and please be indulgent. We're going to get back to you soon. We probably won't give you those numbers at the end of July without being properly prepared because otherwise, you won't be able to model and understand. So very likely by the end of June, we need to organize the date, and we need to define whether it's a Capital Market Day, whether it's just a rendezvous.Pierre-Loup Etienne, Jean-Jacques, myself, the new Chief Financial Officer, we will sit down. We'll sit down in some proper format to make sure we can actually give you kind of a lead of the way we have been reorganized. So, I guess, when the numbers are released at the end of July, you have been at the benefit of -- months, sorry, to understand the way this group is functioning. So, we'll get back to you, but very likely we're going to have a deep dive. Let's call it that way now, a deep dive into the new organization by the end of June with the proper CEOs and executives, probably on the stage with you representing what they do.On the last slide, it's simple and I just -- you don't know how much time we spend on putting the words next to one another on a simple phrase. And the first one, which is why I said is simple, start with reap the benefit. If we do a reorganization, it's because we believe we can even achieve greater, better results in the years ahead. Simplified, this is what your boy is all about, is more focused model and organization.Number 2, sustained activity for 2023. We are today telling you that we are looking forward for a RevPAR expectation. We never do actually, by the way. We've never done it over the last few years. We usually wait until first semester to be behind us, end of July to give you some kind of guidance. But decided that I guess, we feel strong enough that we could even though the bracket is large, that we could have said that 2023 will be a better caliber with a better revenue top line and RevPAR, which is as we assess today and we'll fine tune that bracket 5% to 9% looking forward for 2023.Number 3, Accor has been for 50 years, certainly one of the best leaders when it comes to CSR, ESG industry practices. You know and we said it all the different executives at -- in hospitality, Marriott, Hilton, Intercontinental whomever, that you need to do it in terms of carbon reduction, in terms of food waste, in terms of energy reduction, in terms of diversity inclusion. But we also need to do it together. So, we don't want Accor to be the leader and the best. We just want to make sure what we do well is very rapidly shared with the entire hospitality industry and they wish exactly the same thing on the other side of the Atlantic. So if anything we have, which is maybe of a differentiating factor is when it comes to diversity, inclusion and what we do for a lot of the colleagues of Accor, you know what we have done with the Heartist Fund with 120,000 people benefiting from EUR36 million investment.We're going to be continuing putting even a greater sense into the caring attitude of being in the hospitality industry. It's extremely important, even more so when you have staff shortage. But it's where we should be in front of our clients, in front of the owners, and of course, with our own colleagues and employees. And we're spending a lot of time on it and we're very proud of what has been achieved over the last 50 years and certainly over the last 3 years.And the last point is, I told you many times that I guess we spent the last 3 years caring about our employees, caring about our owners, of course, looking at clients being back. It is certainly a time to care more and to think deeper about the shareholders of company. We need to go back to larger return of capital to the shareholders, but there is a but, which you've seen in the pages of Jean-Jacques is as long as we fulfill the commitment to restore investment-grade rating. I hope on your question of time and we'll spend the time with Jean-Jacques, myself Pierre-Loup with the rating agencies, but we need to be in a greater more solid position to go back to investment grade rating before we can be even more generous as we should be with the shareholders. Well, that's where we are.I did go overtime by 45 seconds. So now we have the next 45 minutes, 50 minutes on the Q&A. And the line is probably going to be working. So, I don't know who is going to want to go first. But let's launch the Q&A session.Thank you so much for attending so far. Richard Clarke, we have the benefit of having a few, not that many. So, we're not exactly alone, Jean-Jacques and I here on the desk. But Richard Clarke has nothing to do except being in Paris today. So he is kind of actually by surprise, showed up this morning. Happy to see you, Richard, live here. So since you here and you have your hand raised, why don't you go first?
Yes, Richard Clarke from Bernstein. 3, as per normal. I guess, just starting on the RevPAR guidance. You gave some pretty positive commentary on how January started. It looks like if Q1 matched Q4, that would give you 10% year-on-year RevPAR growth, so you'd be in negative territory for the rest of the year. So just wondering, are you expecting some slowdown through the year? What's the sort of cadence of that RevPAR growth? Why is there such a slowdown from what you did in the second half of 2022?Second one around, I guess, you're not going to give EBITDA guidance, but just thinking about how we can think about some of the building blocks from the EUR675 million this year into next year, how should we think about RevPAR sensitivity? How we can think about incremental cost savings, unit growth into next year? And how we might get to build that up?And then the third one. I guess, anything you can give us on the timing of that, the rating agency's changes? And then how much excess cash do you believe you have? You've got EUR1.6 billion of cash on the balance sheet. So once that changes, anything you can say around the sort of scope or size of potential buybacks, you could do?
Just on the rating agency because, this is obviously not in our hands, Richard. I know you know that. And we have, obviously, a very close relationship with the agency in the sense that we really try to make them aware of all they need to be aware in order to assess what is really the situation of the company. One of the difficulty that as being the fact that Europe as a continent as being having a delayed recovery versus the US.And so if you look how the rating has been working is they have been rating the companies that benefited from the first wave of improvement coming from the RevPAR, which has been North America fundamentally. And we think that we now have reached a point where this is the turn of Europe and this is also the turn of Asia. So, I think there is just a timing here in the way all of that get assessed.I cannot, obviously, talk for the rating agency, but I would think that during this year with the kind of perspective that we see and the fact that we, under the current 2022 fiscal year with a leverage from an S&P computation, which is at the level, which is required in order to be investment grade, there should be some positive movement. Again, it's my hope. It's what I think is logical, but it is something that we need to talk to them about.
You want to go on RevPAR, the dicey question?
Yes. On RevPAR, listen, here is the thing. You do something you get hit. You don't do something you get hit. So, I don't know what to do anymore. We never give the RevPAR, right? We never give the RevPAR at this time of the year. We decided with Sebastien that as we are coming from a period which has been relatively volatile, to say the least, we are going to make sure that we provide a positive signal that the 2023 numbers will be better than the 2022 numbers. You know some people were doubting of that. I mean I'm talking investment base because of all the reason we know in the world, inflation, I mean, Russia crisis, supply chain and all of that. We do not believe this is going to be the case in 2023.And I think another element that I can jump on here is that there is no slowdown of the pricing power. There is a better utilization of the hotel. The occupancy has been improving quarter after quarter. And there is now coming onboard China, Asia more generally and with some potential, which is still significant on the other regions in term of occupancy rate. So, we wanted to pass sign that we would be showing growth next year is 5% to 9% the best number. These numbers are given on the 1st of January. So on the 1st of Jan, I'm not going to put myself totally naked and so wanted to give a signal. It's a positive signal and the numbers for January and February is much above that number.
I guess, I'll say it a bit differently and I hope I'm not wrong. Since I alluded to Jean-Jacques being there for the last 7 years, and of course, he will be accepting this. With the exception of 2020 and 2021, clearly, we were a bit outside of control, our own control on the activities. I don't know of any year since Jean-Jacques has been here, and thank god, me before, where Accor did not perform better, that any guidance we provided to anybody outside, never ever we have been under what we've been estimating. I'll leave it as such.When it comes to the EBITDA sensitivities, Richard, we've moved away purposely from whether it is EUR13 million for a point of RevPAR, EUR15 million, EUR12 million, because, of course, as you know, it's very different on the upside as opposed to what is on the downside. And it's a metric that people internally did not really assess and understand. But that was the only one which could be provided to the Street for the last 24 months. So, we've been shying away from it, because it was not understandable and it was not clear enough for people to be motivated.What we can tell you and we discussed it, of course, Jean-Jacques and I a couple of days ago is since we believe it's going to be a good year for 2023, the EBITDA will go up by more than a double-digit percentage. That's what I can tell you.What do we have? Sorry, we need to get people on the phone because otherwise, there's not enough people in this room besides Richard and ourselves. Are we connected with the outside world?
[Operator Instruction] We will now take our first question from Jamie Rollo at Morgan Stanley.
3 quick ones, I hope, for me. First of all, just thinking about Services to Owners this year, are you still expecting a broadly breakeven performance?Secondly, could you give us a feeling for why you think net unit growth might come out this year? I mean, fairly good end to the year. And sort of what you're seeing in terms of conversions, particularly large conversions like some of your competitors have done?And thirdly, where were you on incentive fees last year? And do you see those fully recovering back to the sort of 35% of M&F revenues this year?
I'll take the easy one. Yes, on STO, we're really positive. We committed on that. This is what the business calls -- that is what the model calls for, and so we will be positive. That's one of the building block. In fact, the chart that you are asking on the bridge from 2022 to 2023 as we ended up being negative in 2022 net-net of H1 and H2, there is here one element of bridge between the 2022 actuals and the 2023 outlook as we see it.In terms of incentives, I think the 34%, 35% is a good number. If you look at it with more historical data, Jamie, it's a number that we've more or less done over years. It has always been fidgeting around 1/3 of the revenue being incentive.The only thing, as usual, we need to be cognizant is that it's an average. And even the 32% that we've got this year is, in fact, an average between some very good numbers like Middle East and Africa, as you would expect it from the RevPAR that I showed earlier is well above the historical level of incentive.On the other hand, Greater China, which has got a nice set of properties and service of Fairmont and Sofitel is way behind the level of incentive that we had in history. So, I think the number, in average, is a good number. And then after that, there are chunks which are moving one way or the other depending on how business evolves.
And, Jamie, I'll take the net unit growth and I'll tell you things you might know and probably get a greater clarity. It is 3.2% for 2022. It was 5.5% in 2019. And as you well know, 50% of our growth when it comes to new openings has been for the last 5 years to 7 years in Asia Pacific. Oddly enough, which is what I've been insisting with you for the last couple of years, I don't want to shy away from percentage. But I just want to remind you that even though it looks that 3.2% is, of course, lower than 5.5% 2 years ago, guess what, the volume of fees of 2022 with the 3.2% net unit growth is of a higher magnitude than the volume of fees in 2019 when we had 5.5%. Why? It's a question of mix.Why are we going fast in Luxury & Lifestyle? Because they contribute EUR4,000 fees per room compared to EUR800 fees per room for an Ibis. So, you're going to have to be patient with me. You're going to have to wait until the end of June when I told you, we're going to do a deep dive because it makes no sense whatsoever to continue showing you a combined net unit growth unless we disclose to you what it is per division. And then you will see that what matters is contribution. So, that will be in -- so I'm not shy, I'm not even resisting. We're going to be looking for even greater fees per room in 2023. But I'm insisting -- and I am nosy. I am the only one here that what matters is volume drop-through margin, not percentage.
Jean-Jacques, on the incentive fees -- and apologies, I didn't see the statements, is there a pickup for 2022? And also Sebastien, just on the unit growth here -- okay, scrap the unit growth question. Are you expecting a similar revenue contribution from new openings in '23 as to '22? Or do we need to wait till June for that as well?
I just want to make sure I get your question, right. Are you asking whether the incentive fee percentage will be the same in 2023 versus 2022?
It was really what the actual 2022 number was. I think your 34%, 35% was what you expected '23 to be. But I guess, if we have the 2022 actual number?
Okay. Okay. I mean, it's not difficult because I gave you the 32%, you've got the M&F fees. So, you do 32% of the M&F fees and you will find that it is around EUR330 million. EUR330 million compares to an absolute number in 2019, which was to the tune of EUR360 million. So, you are a little bit behind because, in fact, the percentage is a little bit behind.Is that answering your question, Jamie?
Yes. Apologies. I must admit. Sorry.
No, no. That's okay.
We will now take our next question from Jarrod Castle at UBS.
Congrats, J.J. 3 for me as well.
Thank you so much for me, Jarrod. That's super nice of you.
I still have to do our breakfast. Just coming back to couple of things. Firstly, I mean, any views on the valuation of AccorInvest and also kind of the lease reorg of Mantra and what that could mean for cash flows?Secondly, just didn't really speak that much better, if at all, but just wanted to get an update in terms of the loyalty program and partnership deals. How is that going? Any big signings there, credit cards, other third parties?And then just lastly. I mean, is a time now maybe to think about another 3-year or 5-year target to communicate to the market during the course of this year like you did in the last decade?
Do you want to take the 5-year, 3-year target or should I hedge it?
No, I -- Jarrod, it's a very big debate as we -- there was a debate of the Board yesterday. The Board had to acknowledge the numbers before being released to you and, of course, we had a session at the Board level on timing of a deep dive or Capital Market Day with the outside world. Is it too soon? When to have it? And of course, the content of it, to which I said that we will spend appropriate time internally with executives, and of course, we will have the Board as being devil advocate before showing anything to you. But part of that discussion has been, of course, whether we should be daring and go into a 3-year level on 4-year, 5-year target. And question was, was in between having a photo or having a dynamic photo. And I'm in the camp of showing something to you, which is dynamic which is really what matters.The difficulty with this, and again, we haven't made a decision is, are we really prepared with only 5 months of actual results and 5 months of ownership with the new CEO for them to project themselves only 5 months after into a 3-year target, which we're going to have to live and die from. We haven't come up with a decision, but I understand the remark because I have the same thinking in terms of what we should do or not. And we may not be of the same comfort, Jean-Jacques and I, which is why in tandem has been working so well over the last 7 years.
Yes. I mean, we will do what makes sense on this one, but we understand the need to provide visibility on where the business is heading obviously. Jarrod, on your question on Mantra, I was alluding in my talking points that we've been intelligently, as we could, as part of the renewal of the properties, as part of the negotiation that we could do over the last 4 years -- 3 years, 4 years since we acquired Mantra to reduce that lease exposure. If you look at our accounts, this liability used to be to the tune of EUR300 million plus in 2018, EUR350 million and it's today probably to the tune of EUR200 million. So we've reduced it by close to 40%.And so we're going to continue as much as we can to do it as a dribbling, if you will, and continue to take off the balance sheet that asset-heaviness, if you will. The money that we are going to get coming from the lease, if we have to sell a block of is not what is significant. What is significant is the reduction in the debt that we're carrying on the balance sheet, still EUR200 million of debt on the balance sheet, which is about 10% of what Mantra net debt is. So that's really what we're focused on Mantra. And by the way, just as a side comment, holding Mantra as being the right strategy because we took the loss as things dropped and they dropped, as it is a lease business, quite significantly in 2020, 2021 with the COVID, but they've been also recovering quite nicely. In fact, the level of performance of the Mantra properties, which are leased property is more or less at the level of performance of 2019. The difference in absolute EBITDA is coming from the reduction in number of properties. So, that's also an element for why, I think, this strategy is being the right one.In term of AccorInvest, I mean, there is an answer, which is on the account, the valuation of AccorInvest is to the tune today of EUR600 million, which is the accounting view because we took the losses that AccorInvest have been generating on account as we should do per IFRS. The reality of it is that when we did the transaction of the sale in 2018 and then when we did the complement of sale of the ownership that we've got, the valuation was more to the tune of EUR1.1 billion from the top my head, EUR1.1 billion, a bit more than EUR1.1 billion.So, there is a big difference between the accounting and the market valuation because of what happened in COVID. So, I think EUR1 billion is much more between good high type of valuation. And if you look at how AccorInvest has been performing, they are not fully back to the level of net income or profit that was the one of 2018, 2019, but they are not far off. The same way that we are not fully at the level of 2019 EBITDA, but not far off either.So, there is also a benefit here at getting one more year of good result, couple more year of good result in order to firm up valuation and thinking that people may have about the ownership of this stake and this is what we're going to do. I think, today, the focus is getting out of that crisis and ensuring that you continue the pruning of the portfolio, which is what was started many years ago in Accor, was then pushed to AccorInvest, but this strategy has not changed. As usual, rotation of the asset is the name of the game and so that's what we're working on.I hope this answered your question, Jarrod, on AccorInvest and Mantra.
And on the partnership, Jarrod, it's very imbalanced in terms of signing and credit card. It's doing actually very well in the Middle East. It's doing well in Australia. It's not doing as good as we expected in Europe, and we need to tackle it better in terms of attractiveness, in terms of population, in terms of the right bank network, issuer, emitting sort of relationship is very good with BNP and VISA, which are 2 main partners. But we need to make a bit of push and a greater push and there we have a new leadership under Alix Boulnois, still with [ Medi ]. But that's one of the thing where I know we should get to a better result. We're not there where we want it to be.
We've got Accor in Abu Dhabi. We've got Accor, which is going to be set up in [ Korea ]. We've got Accor in Indonesia, so all have been moving. I think the fundamental issue that we've got versus some of the other countries, in the US, everybody is using credit card and everybody owns 5 credit cards. In France, if you have a credit card, you are not -- there are people who don't even have credit card today. So I mean, that's also what we need to go and better against, but the products that we are proposing to the market in terms of the advantages that we provide, for example, in terms of insurance, in terms of the FX treatment of the fees, all of that is top notch. And so we have the right product, we just need to change the head of the people.
We will move on to our next question from Jaina Mistry at Jefferies.
I've got 3. Just on the guidance range again. The 5% to 9%, I just wondered what are you assuming in terms of the macro environment within your guidance range? And what would we need to see to reach the low-end and high-end as guided?And my second question is around the reorganization. I mean, it obviously sounds like it's going well. But obviously, it's quite a big reorganization internally and I wondered what your thoughts are on the cost and the savings needed perhaps to offset any costs associated with it?My third question is around pricing. I mean, pricing has been really strong in 2022. I know you said you've seen no slowdown so far. But what's your outlook for 2023 in terms of rates?
Just on the RevPAR to second. Two things, which really are kind of actually a question mark, but it's not question of low-end of the guidance or the upper end. China, is how fast and strong will be the comeback of the 150 million Chinese travelers, which we enjoyed in 2019 and where would they go? Are they going to go to Vietnam, Laos, Cambodia? Are they going to go to Korea? Are they going to go to Indonesia? Are they going to go to Singapore? And of course, depending on market, pricing is not the same. And of course, how many of them could go to Europe for that matter. So it's a mixed geography where -- and a quantum on where those Chinese travelers going to come.Two is what we started with is fragility or not of GDP resistance of some European countries being UK and Germany, and where we are and where there is numbers of large boxes and fair and conference and events. It's certainly going to be better than 2022, of course. But how robust would that be and which timing? That's really what guides us on having that range what it is. On the reorg, the reorg is -- thank you for saying it, it is ahead of time because I told you, they started mid-November as opposed to having started on the 1st of January. And again, greater force that expected myself from the team in terms of taking ownership of their own duties and excited about it. In terms of timing, timing, we are ahead and I have no fear.In terms of cost associated with this, we said it has to be cost neutral and that has been acknowledged and agreed by everybody within Accor. So it will be cost neutral. And cost neutral is for me in 12 months to 15 months from now, not 3 months. So, you may be having a bit of cost in the first semester, which you're going to be regaining as a result in the second semester. I don't know. I don't want to be blurry with you, but it's certainly cost neutral with 12 months to 14 months objective and no longer.
I'll add something on this one. The reason for why we feel so comfortable about it is that, yes, we put this organization in place as of January 1st, but we've been working on it for more than 1 year and we've been working on it for more than 1 year, in fact, on the desk thinking about what needs to be done in order to ensure that the concept was working and hence, that you are not, for the benefit of focusing, creating an overhang which was too significant.And so we've been planning that thing extremely in advance. And that means that some of the changes in the way we operate are also part of the way we ensure that neutrality. So for example, a reduction in the number of region, some more additional shared services, further optimization of the tools. It's nothing else than continuing what was done to reset and continuing that good discipline of forward thinking of how you do business.And as you are more focused, you get, in fact, a better definition of what you can optimize. When you ask quite a lot of the thing, I mean, it creates some kind of a gray zone in many places. Here, you reduce your scope and once you reduce your scope, you do better what you need to address. So anyway for whatever it's worth, it's something that we've been really working on upfront.
And pricing is holding in terms of rate per room. Certainly for us in hospitality, as it is in our industry, you've seen the result of airline companies where they also enjoyed a very significant uplift in pricing. So, no fear still there.
I think there if you look at some statistics and analysis done, I think what you find out is that the share of wallet of the consumer is, in fact, getting larger for anything, which has to do with travel. So it's not only hotel. It's travel in general term. Sebastien was referring to airline, and so there is a series of data that has been coming out, which explains why you get that. And in fact, people -- it's just basic thing, I mean people have been experiencing what it takes when you don't get it.So maybe not going to be as crazy as what happened in Q3, where there was a limited capacity in many places and supply-demand inequation. But I think you're going to see that continuing, the willingness of people to spend more on travel, leisure than what they used to do before the crisis on the one hand. And then the other thing, which is going to play off is that some of the traveling capabilities are gaining again in capacity, notably the flight between the world and Asia. And so you're going to see anyway also an [ operationalized ] effect on the RevPAR, hence the fact that we really, really feel comfortable about the RevPAR numbers that we've been giving as of the 1st of January.
If I could just clarify on the guidance range, are you assuming a slowdown in macro conditions or some form of recession at the lower end of the range at 5% range?
No, we're not.
No.
We will move on to our next question from Leo Carrington at Citi.
If I could start with -- I've got 2 questions. Just one briefly, just to follow up on AccorInvest I think what you've said is very clear, but conscious of the lock-up expires in May for your residual ownership. Would the intention be to start marketing this for disposal promptly? Or do you think there is more of the nuanced approach in terms of seeing 12 months of full performance before disposal for an optimal price? Just a bit of a color on your thinking there.And then second question. Obviously, the pipeline is growing a little sequentially from Q3. Can you give some more color on the moving parts in there and in terms of signings? And maybe asking the same question different way. With lifestyle and luxury is obviously at the early stages of implementation of the new structure when you've launched the new Handwritten Collection brand, so there are moving parts there. But do you have a view on how the pipeline mix ultimately will settle between the 2 new divisions, maybe in 2 years' time, say?
I'll take AccorInvest. On AccorInvest, the answer to your question is that it's going to be nuanced. You need to give them a little bit more time to just make sure that they can get to a level of result, which I think is what I said before. But I just want to reaffirm it to answer your question because anybody who is going to look at it will want to ensure what he is entering into. And hence, we'll want to wait and get a little bit more of numbers, positive numbers. Remember, you saw my numbers when I showed you that I was losing on my 30% more than EUR200 million 1 year ago. I am at 0 this year. And I think people will want to wait a bit more, so that this 0 becomes a positive number.Pipeline, Sebastien you want to do it?
No. On the pipeline, as I said to Jamie, you have to accept, I guess. I do not want to go broad on this question unless I go specific on the 2 divisions. Because having a common number for the group as it stands today makes absolute no sense. So, you'll have the clarity you need, which I want to share with you in end of June.
Okay. I look forward to it.
Do we have another question?
We'll take our next question. Sure. Yes, we do. We take our next question from Vicki Stern at Barclays.
First question is just on the -- coming back on sort of cash return leverage piece. Sort of assuming things progressed well on the S&P rating front, can we come back on sort of where you feel is the right level to be at in terms of your leverage? You obviously said that leverage range in a different world where interest rates were 0. One of your US peers has sort of perhaps there on the side of caution there in the range just because of the higher interest rate environment. But how are you thinking about putting this credit rating piece aside for a second, the right level of leverage now in this sort of world going forward?Second question is just coming back on that marketing swing comment that you talked about for -- Jean-Jacques. I think it was probably EUR75 million or so was the delta that we were talking about on marketing spend last year. Should we expect all of that to sort of come back into the EBITDA in '23? Or there any sort of additional spending points we should have in mind on that one?And then just finally, stepping back on the new organization. Obviously, lots of reasons to reorganizing the way you're doing. But just is there any sort of end game we should be thinking about in terms of structure of the group ultimately? Is the desire just to sort of present these 2 businesses as separate units, or ultimately you could consider the sort of separation of the 2?
I'll just take the easy one, which is the one on the debt and I'll give the difficult one to Sebastien. I think below 3.5% is the right level, Vicki, that we're seeing currently. I think 3.5% is what we're discussing with the rating agencies. So somewhere a little bit below 3.5% would give us the comfort we need. And it's not only S&P. It's S&P and Fitch by the way that we need to basically talk to on just for the sake of clarity.
Yes. Just what and I should have answered in one of the questions before for the same topic, Vicki, which is why you're going back to it because we simply did not answer because we missed it, sorry. Totally agree with Jean-Jacques, so post shareholder buyback, we have to be lower than 3.5%, no question about it. Otherwise, we're not going to be playing yoyo with our commitment to restore investment grade. We should not and we will not.The numbers we have in mind, the minute we could be in a very comfortable situation, it's certainly meaningful in terms of do we need EUR1.6 billion cash on the balance sheet? No. Could we leave with a EUR1 billion cash on balance sheet? Yes. I.e., it's probably EUR500 million to EUR600 million. It's EUR500 million to EUR600 million. Should it be 5% of Accor market cap? Yes. 5% of Accor market cap is EUR400-ish million. So in my mind, the minute you stay well comfortable below the 3.5%, if you can afford to use a third of your cash and up to 5% of your stock, we should do it in a minute. There is no better investment than this one.In terms of separating the 2 autonomous division, number one, give us a benefit of showing growth performances and different profile because they do have, which is why I'm insisting on not providing aggregated numbers today because we've been going deep dive, Jean-Jacques and myself and many others here. You don't know how much those 2 are different in terms of growth, in terms of profile, in terms of RevPAR, in terms of net unit growth, vastly different which is not a surprise. But this is exactly why we need a greater focus. And they both fit very well on the Accor's balance sheet, Accor size, Accor network and Accor relationship with the owners.So as much as I've been blamed for not being boring enough, it is not the time to go do transformation number 6. And that's number five. We had the first one which was get light. Then we had a second one, which was get broad, go big into luxury, lifestyle and non-Europe. Then we had get fit, which was the 22% headcount reductions for COVID. Now, we have, get focus. It is not the time to go into a fifth transformation. So let's get our act together. Let's get EBITDA where it should be. Let's get great margin out of 2 businesses. And that question we'll defer it whenever it need to be, but not now.
And the last element of your question, Vicki, to make it very, very clear, STO positive plus, Services to Owners for 2023.
We'll move on to our next question from Andre Juillard at Deutsche Bank.
Congratulations for these strong results. Congratulations, Jean-Jacques, for your new role. 3 questions, if I may. First one is about the saving plan you put in place in 2020. Could you give us some more color about where you are and what you still expect to be delivered structurally and permanently from this saving plan in the future?Second question is about AccorInvest. I understand that you need time to fully recover. But could you give us some more color about the different options you're thinking about and what kind of discussions you have at the moment with the actual shareholders of AccorInvest?And last question, if I may. You've got a record number of brands at the moment. With the new organization, do you think about reducing these number of brands and merging some of them? Or is the idea to keep all of them?
On the saving plan, I think it does not change from what we've been communicating. I think we said it's EUR200 million EBITDA, and EUR20 million of it was to come after the end of 2022. So the EUR20 million remains the right number. Again, this is very natural because those EUR20 million are coming from system changes. They needed time to be implemented. And so they are being implementing -- implemented, sorry. And so you will get those EUR20 million additional in 2023. In term of...
I'll tell you a bit on AccorInvest, Andre. It's a very professional sophisticated consortium of investors, which you know. You are in the hands of former colony investors, then Amundi, then GIC, then PIF. Many of them are, of course, sovereign funds and then you have Accor, and a tiny bit of Scandinavian family offices' sovereign fund as well. So professional sophisticated expert in terms of return and in terms of risk matters. So, we've been battling all of us together very well through the mud of 2020 and 2021 facing restructuring, a EUR1 billion of necessary fund, EUR500 million state guaranteed loan and EUR500 million from investors. We're just out of the woods in terms of greater performances close enough to 2019 like Jean-Jacques just talked about. So it's a matter of projecting ourselves.We've missed 2 years. Let's not miss the next 2 years. And the next two years are all about operations and trying to reduce level of debt by basically reorganizing, reshuffling the portfolio of AccorInvest. So as Jean-Jacques said, first, you want to wait for greater result which you're going to have. Two, you have to battle together to simplify the balance sheet of this company before you're even thinking of leaving the ship. And we said to our common shareholders and partners, we will be there with them and not depart because the lockup is over. We simply won't until the job is finished.And when it comes to brand and numbers of brands, Andre, 3 years or 4 years ago, I remember everybody telling us, I guess, Accor has too many brands, and look at how many other brands they have in a different organization. So, you'll have, again as I said, be with me end of June, me being us, be with us end of June and we'll go -- probably better granularity when it comes to what is of Sofitel versus MGallery, what is Fairmont, what is TRIBE, what is Handwritten, what is Mercure. So you will have -- no, we do not have too many brands. We're not foolish. We're not naive. We have the brands we want and the brands we need.
We will now take our last question from [indiscernible] at [indiscernible].
I just have 2 questions. First is, you have [ 400 ] in Huazhu. How many hotels do you still have in Mainland China? And the second question is about the hybrid. It's just typical that you can call back your hybrid from the first call date.
Jean-Jacques is probably looking for Greater China. We have over 500. With Huazhu, we have 450 hotels with Huazhu. And to that, you need to add the hotel that Accor is having. So it could be an additional 150, I would say.
Yes. I think we have above 650 hotels in China. So the Huazhu is -- the partnership with them is of the exact same quality regardless of owning 10% of Huazhu at the time and of which we have nothing left because as you know, we sold everything In the last 4 months. So, we're going to be continuing the master franchise partnership with them and Ibis and Mercure.We entered another partnership into Huazhu with another Chinese operator, which you know called Country Garden. So we're not exclusive to Huazhu. But the relationship is extremely strong. Chairman [ Ji Qi ] and the teams of Accor, we trusted relationship, we know each other well. I'll be again with them and Jean-Jacques. I think in mid-March, we will go and sit down with Ji Qi and Huazhu. Huazhu is enjoying very significant growth. So no, it's -- the reason why we entered 6 years ago are still very much the same today. So, we should be enjoying the ride together.
And on the hybrid, this has been part of our capital structure for now, many, many years. It was there when I arrived and it's a very nice instrument. And so we plan to continue maintaining that structure.
I think we should be almost leave it as such unless there's one last question. But if it's not the case, then we need to go and sit down with the shareholders, whether current shareholders or prospective shareholders of Accor and trying to actually share the very strong story of ours. [Foreign Language]Thank you so much for having connected to this con call. Again, Jean-Jacques [Foreign Language].
Thank you, everybody. Thank you, Sebastien.
Bye-bye.
Bye-bye.