Club Méditerranée : Revenue for the third quarter of fiscal 2010
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Club Méditerranée : Revenue for the third quarter of fiscal 2010
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Category: Europe - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2010-09-14
Consolidated revenue up 4.5% as reported to €329m, from €315m in Q3 2009
Villages revenue up 0.6% at constant exchange rates
vs. declines of 10.3% in Q1 and 4.5% in Q2 2010
Total summer bookings at 11 September up 1.6% (down 0.9% at 5 June when first-half figures
were released)
- Summer bookings up 9.7% over the last eight weeks
- Ongoing trend in last-minute bookings
Net gain in customers in the third quarter:
An additional 13,000 customers, net, of which 16,000 for 4 and 5-Trident villages
Acquisition of an equity stake by China’s Fosun
- A forefront partner to speed growth in China
Winter sales off to a very encouraging start
I. BUSINESS PERFORMANCE
· Consolidated revenue for third-quarter 2010 (1 May – 31 July) rose by 4.5% as reported to
€329 million, from €315 million in the prior-year period.
· Villages revenue (excluding villa sales) rose by 0.6% in the third quarter at constant exchange
rates, compared with declines of 10.3% in the first quarter and 4.5% in the second. This improvement
reflects a gradually recovery in the upmarket, all-inclusive tourist market.
· Capacity was up 2.7% in the third quarter with the renovated section of Calypso at Djerba la
Douce open for the full season and a return to normal capacity at Cancun (impact of the influenza A
epidemic in 2009) and La Caravelle (closed because of social unrest in 2009).
· A net gain in customers of 4.2% was recorded for the period compared with third-quarter
2009, representing an additional 13,000 customers, net. The number of new 4 and 5-Trident
customers totaled 16,000, a 10.6% increase for the most upmarket villages.
Consolidated revenue for the first nine months of fiscal 2010 (1 November 2009 – 31 July 2010)
totaled €1,008 million, compared with €1,034 million in the prior-year period, a decline of 2.5% as
reported. At constant exchange rates, revenue was down 4.7%
II. THIRD-QUARTER HIGHLIGHTS
Strategic partnership including capital ties with China’s Fosun Group
On 13 June 2010, Club Méditerranée and Fosun Group, China’s largest private conglomerate,
announced the signature of a strategic agreement to develop upmarket resorts and to forge
synergies in China, mainly in the areas of business tourism and media. As part of the agreement,
Fosun announced it was acquiring a 7.1% stake in Club Méditerranée.
In line with Fosun’s current strategy, the Group is investing in Club Méditerranée with the goal of
becoming one of its long-term core shareholders. However, Fosun is not planning to increase its
stake above 10% during the 24 months following the signing of the agreement provided that no other
shareholder acquires (or expresses the intention to acquire) more than 10% of Club Méditerranée’s
capital.
This strategic agreement will enable Club Méditerranée to:
- Step up the pace of growth in China and reach its goal of five villages and 200,000
customers in China by 2015, making the country its second-largest market.
- Expand and strengthen the international scope of the Board of Directors. At its meeting on
Tuesday, 29 June 2010, the Board co-opted Jiannong Qian, General Manager, Business Investment
of the Fosun Group, as a new director.
Increase in air transport costs for the period
Air transport costs rose significantly during the third quarter. Jet fuel prices, which were particularly
low last year, spiked during the summer on higher oil prices and the stronger dollar, negatively
impacting transportation margins.
Partnership with Transavia
On 21 May 2010, a three-year partnership agreement was signed with Transavia, an Air France KLM
subsidiary, to carry Club Méditerranée customers on medium-haul flights operated by Transavia
France. With the agreement, which takes effect next November 2010, Transavia France will become
Club Med’s leading supplier of chartered flights, accounting for 35% of such flights for France. The
terms of the contract will improve customer service quality while optimizing Club Med’s costs.
Partnership with Thomas Cook France
On 26 May 2010, Club Méditerranée and Thomas Cook SAS announced they had strengthened their
partnership and signed a new three-year strategic agreement. The pact calls for a sales and
marketing action plan intended to showcase the Club Med offering throughout the Thomas Cook
network, which has been the Group’s leading distributor since 1966.
Cornerstone laid at Valmorel
On 2 July, the cornerstone was laid for the future Valmorel village in the French Alps. The ceremony
was attended by Hervé Gaymard, Chairman of the Savoie General Council, Michel Bouvard,
Chairman of the Caisse des Dépôts Supervisory Board, and Henri Giscard d’Estaing. Flagship of the
upmarket snow village offering, this 4-Trident village with a 5-Trident area is the first Club Med facility
to obtain France’s HQE1 environmental certification. The 418-room village will also be the first to offer
a program for children that extends from Baby Club Med to Passworld, as well as 80 chalet
apartments for sale.
III. OUTLOOK
Summer bookings to date, by outbound market
Year-to-date summer reservations are up 1.6% compared with summer 2009, lifted by late bookings.
By region, Asia and the Americas have seen significant increases of 10% and 11.1% respectively,
while bookings in Europe made up ground in the third quarter, reducing the 4.4% shortfall recorded
at 5 June to 0.6%.
Bookings over the last eight weeks continued to improve, reflecting the ongoing trend toward lastminute
bookings.
Winter 2011 sales are off to a very encouraging start, with a double-digit increase in bookings.
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