Accor SA (EPA:AC)

Earnings Call: H2 2018

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Feb 21, 2019

Okay, we're going to try to start not on time, a bit late, 6 minutes late. I apologize for those of you who have been waiting on the webcast for the last 6 minutes. But we're starting. Good morning for those of you who came here. Another big day for Accor. You probably have seen this morning, a lot of announcement, very surprising announcement when it comes to partnership. We will modify a bit the presentation that you're accustomed to have for the year-end results. Don't be surprised, be happy. We're going to be putting less slides on numbers, on the year-end 2018 numbers, which by the way, are just exceptional. They're actually super good. Since it is behind us, and I'm always looking forward in front of us, we're going to be spending much more time, half of this session this morning, on distribution, loyalty, guest experience, something which is deep in our stomach, deep in our ambition, and clearly on which we're going to be succeeding superbly. Part of the announcement of this morning, which is absolutely not anecdotal, is that new signage to my right, which is a new logo of Accor. None of you should be surprised, even though it was my decision 3 and a half years ago to add hotels to Accor name, well, we're actually making the exact reverse decision. Not because I regret what we decided 3 and a half years ago. Because it was meant at the time to put enormous emphasis, notoriety, on Accor is a hotel group. Or maybe I should say Accor was a hotel group. Now we're dropping hotels because we've been doing so much more than hotels. Of course, hotels is still going to be the core activities of Accor for the next few years, for the next 50 years, but we added so much in terms of ecosystem. We're getting slowly but deeply into augmented hospitality. Before I talk too much about it, let's see what is a new film on who we are. Here is a story that you don't usually hear until it's over. But the point it starts, no one can see. Right at this moment, it's just coming to be. It's not fiction. It's not make-believe. It's a true story, pre-told. You see, some people tell you that's just the way things are. That's where our story begins. We won't stand for that. We are visionaries. We are re-imagining hospitality, and it's not confined by the walls of a hotel. It's a whole new way to live. The way we see it's not an evolution, it's a revolution, a leap into the future. This is a story of tomorrow, our story, because the future belongs to those who design it. We're going to bring you there first. What you see here, and what you probably heard here is the story belongs to those who design it. This is exactly what 290,000 people of Accor are doing. We're just designing our future voluntarily with no pressure, no calendar, just a true will that Accor is moving into a new dimension. On this topic, let's go back on what we have done over the last 12 months. Again, it's going to go fairly quickly. We're going to go quickly because we talked about it at length only 2 and a half months ago through the Capital Market Day. No reason at all to go back on the depths of what was said at the time. But I just want you to know that whatever we told you on November 22nd, maybe it was, 2 and a half months ago, is still 100% valid. It's just a matter of executing, a matter of transparency, and a matter, basically, of describing where we're going. On the left side here, Booster, we talked so much about Booster over the last couple years. It was done happily so, and we got the EUR 4.8 billion cash proceeds, and we're still retaining 35% of that entity. They are doing also very well over the last 12 months, and I'm sure they will do also very well over the next few years. Capital allocation of Booster, we did spend, sorry, I should have said, we did invest EUR 2 billion of the EUR 4.8 billion only in the last 12 months. You know those companies, whether it is Mantra, Atton, Mövenpick, SBE, and many others. We also announced and in the process of completing EUR 850 million of share buyback. All of that is of no news to you, but it is just what has been tackled over the last 12 months. The third column here is what I want personally to spend time on this session with you, because when I was thinking about this session this morning, I was actually shifting and pushing myself from having been, for the last couple years, extremely targeted on anything which was external to Accor. Strategic, M&A, trying to get real estate sold, discussing with potential big investors on providing EUR 4.8 billion for Accor. Now is the time for me and for many others to spend 95% of our time on Accor internal. Which basically get back on three things, and on which I have to say, I did not spend probably enough time because they were not in my top five priorities. Now they are. First one, global sales distribution loyalty. It matters enormously when you happen to be a people servicer and a hotel operator and franchisor. Second priority, marketing. You're going to hear a lot about it from Steven Taylor, so would you from Maud and Ian Di Tullio on distribution and loyalty. Marketing is key because it is brand awareness. This is the way people see Accor. This is where you selling a promise that you have to fulfill. The film you just seen, it's a true revolution for Accor. Why? Maybe you did not see it. For 50 years, when Accor had a film on a brand on corporate, what did we see? We saw a cup of coffee. We saw a bed. We saw a lobby. We saw a kitchen. We saw basically a product. Nowhere in the film here do you see a cup of coffee or a shower head or a bed or a lobby. It is on purpose. We are going into from product to client-minded. I told you this for the last five years, you just have to show that we are basically going in day-to-day life, something which is fun, experiential, and something in which we are actually pushing a new ambition and new emotion. The last and not the least is people. There are 290,000 persons working for Accor. Whatever we have done for the last five years, whatever we have done for the last 12 months, and what we have done for the last 12 hours, working all night again, with probably 70 people here at this headquarters until 4:00 in the morning. Tackling on making sure that we would have signed and able to present to you all those partnerships that we wanted to display to you. I need to be extremely thankful because clearly, and I am not alone, but you do not know how good they are, whether they are at headquarters, whether they are at the hotels, country level or any different type of jobs. I am going to be spending a lot of time on those incredible talents we have at Accor. There is a slide here which is 2 seconds on Capital Market Day. Again, 12 months ago. We told you with Jean-Jacques that the four or five KPIs we are going to be looking in terms of elements of proof of whether or not Accor is able to go from a EUR 600 million last year EBITDA to EUR 1.2 billion by 2022. We said to you can actually have your own markers, which are RevPAR. We are shooting for +3% CAGR over the next four to five years. Last 12 months, thank God, it has been better than projected. It was 5.6%. So we are fine. Second KPI, we said we should have a net system growth of at least 5%. Last year it was exactly 5%, 44,000 rooms. Great achievement from the team because it happened to be on over 100 countries. It is difficult to maneuver in 100 different cultures and jurisdictions. We said we should have like for like, EBITDA growth between 10% and 12%. It was 10.7%. We also said we should have a recurring free cash flow increase per year of roughly 10%. Last year was 22%. Finally, we told you, since we wanted to be benchmark against Marriott, Hilton and many other asset-light company, that we should have a good cash flow conversion of at least 70%. It was much better than even myself expected. Great job by Pierre Boisselier and their team on basically controlling the cash. 83%, EUR 525 million, I think it is. So 12 months passing, first year, check the box, all the KPIs having basically met, so it gives me comfort that it should be met again for the next 12 months to 48 months. That slide, I need to give credit to Patrick Mendes, who is the CEO for Latin America. Every month we do what we call a deep dive. So we go with the executive committee to different regions, and we spend time with the local management team. He showed me that slide, which I have never seen before, and probably many of you haven't seen it either. That slide says on the horizontal bar, it's the number of international tourists coming to a destination. You see top of the game, which is of no surprise, France, is close to 90 million visitors a year. Close enough, Spain, who is like 80 million. On the vertical bar is the number of existing supply, which is the numbers of rooms per 1,000 inhabitants. For France, you go all the way to the left. It's roughly 12 rooms per 1,000 inhabitants. Spain is 20, probably 75% more in terms of supply compared to France. What's intriguing about that slide is it gives you a very good indication of where France should be moving. You see China here, pretty good. Over 60 million international travelers. See how low they are in terms of supply, which is roughly less than 2.5 rooms per 1,000 inhabitant, which is why Monsieur Jinjiang, Monsieur Waizu, Monsieur BTG are opening 700 hotels per year. Because there is enormous room for them to grow and to go, and I don't know how much time it's going to take them to go from 2.5 to 10 rooms per 1,000 inhabitant, but this is where they're going. They're going to be going way north vertically to basically gaining more traction. What was intriguing to me is the orange circle here. You see in that circle many countries in which Accor has been present for a number of years. You see Argentina, you see India, you see Brazil, Chile, Colombia, Egypt, Russia. In where you have not that great numbers of international travelers and not that great numbers of supply, which means those country as well are moving, but the one thing you learn from those different slides is many of those orange bars are depending on domestic traffic. Domestic traffic happens to be 70% B2B, medium, small enterprises going and basically occupying our spaces. We should be spending so much more time with you, but I guess we'll do it in a different dedicated session because you also have to pair this with GDP per capita. But it's an interesting way of looking at trends and where the industry is going. Last slide for me is people. We talk quite a lot about the 290,000 people working for Accor brands. What we don't talk enough is what it takes us to make sure those people have the skills, the gift, the envy, the passion, and obviously, the training. We train 80,000 people per year. On top here, we actually hire every year, basically 80,000 to 100,000 people because we lose every year 50,000 people. The turnover. People we have trained for the previous three or four years who are going to either a new industry or a new competitor, which is fine. We just basically gave a hand to those people when they needed it the most. Very young crowd at Accor, 35% below 35 years old, and I think it is roughly 60% female and 40% male. We have 800 people in-house, basically as trainers, looking after those people with a lot of actually different digital tools. We have huge engagement from the team. You have to understand, you can only service a client if the people servicing the client is a happy person. Has the envy to basically wake up at 4:00 in the morning, to be there at 6:00 to do the shift. 90% of Accor recipe for being so successful as an operator and as a developer is in the hands of people on the ground. I have been saying it many, many times, and I am going to be repeating again, the main difference between Accor and many other company is one, we are the biggest hotel operator on the planet. As big as Marriott, as big as Jinjiang, as big as Hilton. They have lower number of hotel that they actually manage. We manage almost 70% of the 4,800 hotels, i.e. we have responsibility for those hundreds of people in each hotels. Hilton, Marriott, Jinjiang, InterContinental are mostly franchisor, i.e. they do not see the people on the ground. They only provide traffic, brand distribution loyalty, which is good enough and tough enough. But I just want you to understand, we happen to be different model, and we have our hands into the engine. The second thing, those people are in 100 countries, and we are just enriching ourselves from being able to deal with Chilean people, Russian people, Polish people, Nigerian people, and many other different countries. This is tough to do, but on that aspect, we just are unbeatable. Monsieur Jean-Jacques, on numbers. Good morning. Good morning, ladies and gentlemen. Very happy to be with you today to talk about a simplified version of the financial results, which you see is not so much simplified. Very happy with the result that we just produced. I think one important element in anything we do is the credibility of the number produced on the table that Sébastien, just once who shows you how we execute per our word. Moving to a kind of summary of the performance. Let me see what else. Sorry. Is it working? No, it is not working. Just a little techni-- Oh, Okay. Let me go back to the first slide of this presentation, which is an overview of the financial achievement of the year. The first thing that is very noticeable this year is the significant business momentum that we went through. We delivered a 5.6 like-for-like RevPAR, and Q4 was in fact the strongest quarter in the year. So the exit velocity in the year is also very good. The net system growth was exactly in line with the 5% target, as mentioned by Sébastien. Our pipeline grew significantly with a record level of signings. We finished, in fact, the year close to 200,000 rooms. In terms of pure financial performance, the business volume now reaches the EUR 20 billion mark. For the sake of comparison, in 2015, when we started the journey, it was EUR 13 billion. Our EBITDA was right in the middle of the EUR 700 million to EUR 720 million guidance that was provided, and we end up at EUR 712 million, and our cash conversion was a remarkable 83%. From a shareholder perspective, this performance fueled a strong recurring free cash flow at EUR 529 million. The board of directors decided to submit for approval a EUR 1.05 dividend per share to the general assembly, which I will come back on a bit later in this presentation. Starting with the beginning, which is the room addition and the hotel portfolio. A very easy number to remember, 100,000 rooms added to the portfolio, which is a combination of 44,000 organically and 56,000 coming from acquisition. We did two significant acquisition in term of network in 2018. One is Mantra, which you see accounts for 25,000 rooms, the other one being Mövenpick, which accounts for 21,000 rooms, both strengthening, in fact, our portfolio in the mid-scale and luxury segment. Consistent with previous years, half of the growth is coming from Asia Pacific. Noticeable this year, NCAC, which grew a little bit faster than the other regions from smaller numbers, granted. It's steaming from 1,000 room opening in Austin, a Fairmont, and the acquisition of SBE and 21c. Luxury was 44% of the room addition last year, which is shaped by the acquisition of Mövenpick. Just so that it is not only a presentation on numbers, I was just mentioning the Fairmont in Austin, so you can see a picture of the Fairmont in Austin popping up on the left top corner. As again, a way to explicit the kind of products that we are now putting on the market, in term of management and franchise contract, you have here what we opened in the last three months, i.e. a Fairmont in Riyadh, a Rixos in Abu Dhabi, and our brand-new Raffles in Warsaw, which is a wonderful hotel. Moving, in fact, now to the overall portfolio and not only the addition to the portfolio, 5% net system growth, that's a magical number. You've got here the traditional breakdown that we provide of the network and the pipeline per region. It grew 5% with two threshold, which are symbolic, 700,000 rooms. We've passed 700,000 rooms, and we've got more than 1,000 hotel in the pipeline. If we zoom by geography, which this table provides you some elements on it, Asia Pacific is now 30% of the portfolio, lifted by the expansion and also by the acquisition of Mantra. Middle East and Africa is now our third region, so passed over South America to become our third region. That's on the back of the acquisition of Mövenpick. Again, very dynamic and great pieces of satisfaction for us. If we now go into the trading condition and the RevPAR. Again, very good result, 5.6% over the year. You can see on the right part of the table that this 5.6% is very elegantly spread, with luxury 5.6%, mid-scale 5.5%, economy 5.3%. I could not have hoped for anything more harmonious. In a nutshell, the one thing I'd like to highlight in this slide is the fact that Q4 is the strongest quarter of the year, and that the occupancy, in fact, has been reaching a strong level of 69.3% in 2018. This is 50 basis points more than 2017 and 200 basis points more than 2016. Another remarkable point, because you were making the comments when we published the Q3 result, is the fact that in the RevPAR, 40% comes from occupancy. You can see some kind of an inversion, slight inversion here in term of occupancy versus average room rate, and this is a positive element. This is, by the way, driven by more and more visitor, which are checking in into our hotel in Europe, Middle East, and South America. It is really a very sound, I would say, trend on the constitution of what makes up our RevPAR. I think, moving to a little bit more granularity on this 5.6, you can see a very strong Europe, which ended Q4 at 7.9% RevPAR, and Asia Pacific, which has finished the year also quite nicely with 2018 RevPAR at 4.3%. Europe, in term of number, represents 50% of the network. It has been pulled by a very strong performance in France. The France RevPAR that constitutes a portion of the 7.9 ended up growing at 6.9% in FY 2018. The element into France, which is extremely remarkable from my perspective, is that we end up in Paris with a RevPAR, which is above 12%. The yellow vest and all the discussion that occurred back in December had a very marginal impact on any of our performance. France has reached, this year, a level of 90 million visitor, which is first off, the best number in the world, but also a record number for the country. We have never enjoyed such a very nice business environment. Moving to Germany, RevPAR was up 3.2%. Q4 was very strong, held by the festivities year-end period. In the U.K., RevPAR was also to the tune of 3%, and London was extremely strong because in London, you may recall a discussion around Brexit, around the difficulty of doing business in the U.K. In London, our RevPAR for 2018 is at 4.8%, and this is driven by leisure, and this is driven by sustained inbound travel from Europe, and this is also triggered, I should say, by staycation, the so-called staycation, i.e., the English people staying in England. Spain was also a good number because it is at 3.8%. We see here a recovery from the political tension in Catalonia. As a point of reference, the number of visitor that came to Spain was 86 million EUR. You could see that on the picture that Sébastien showed initially, a very strong country for tourism, so lots of potential. Moving to Asia Pacific, I said that I am very happy with the 4.3%. There has been a lot of discussion again on China and the slowing down of China. I am talking in term of GDP. You all know about the fact that the GDP growth was at the level of what it used to be 30 years ago. What we see in our number is very good figures because the RevPAR overall is at 6.8% in 2018. Australia was weaker with a RevPAR at 1.2%, and it is the same discussion than the one we had before, i.e., increased supply in key cities, Sydney, Perth, Brisbane, and so basically, putting the prices down. If we now look at how it translates into revenue, we have here a table that gives you the overall growth of the revenue at 8.8% in like-for-like year-on-year, but with the split of the value segment. You see that the 8.8% is the like-for-like, but that the reported is much higher at 16.9%. You find here what you would expect, i.e., strong effect coming from the acquisition that accounts for a gap of 13%. With an offset, which that currency were going the wrong way for us during 2018, and this accounts for 5%. This +13% minus 5% explain the variances that you see between the like-for-like and the reported number. Looking at the values segment from a helicopter view, the revenue growth that you've got on hotel service, which is our core activity, it's more than 80% of what we generate in term of financials, is well in line with the Capital Market Day guidance, with an increase of 8.4%, and it's reaching a level of EUR 2.6 billion, and it translates what I just went through, i.e., a strong RevPAR and a strong development activity. The holding and interco, this line reflects mostly the interco that existed between AccorInvest and hotel service up to the point of deconsolidation at the end of May 2018. If we now deep dive a little bit more on what makes up the revenue, the key elements that you want to focus there on is the management and franchise revenue, which includes franchise-based and incentive fees, and it amounts to a number which is now very close to the EUR 1 billion mark and is at like-for-like by 9%. Diving into that 9% growth by region, you can see that for both Europe and Asia Pacific, it's essentially the combination of the RevPAR and the development that I was explaining. It's exactly what you would expect. In term of Middle East and Africa, I was telling you that Middle East and Africa did show a positive RevPAR at 1.8%. This is a remarkable performance. The number itself is not an absolutely great number, 1.8%, but when you compare it to what the competition did, the competition, in fact, was negative. This is a good result that we've got from a positioning in Middle East and Africa. Despite that, you see that the revenue is down because the revenue is down 1.1%, and this is essentially the churn that we went through with you when we published the Q1 results. You remember that we had a couple of large properties that we lost or that we are not getting the management contract anymore in countries which had some economical difficulties. That's what explain the drop of the negative numbers in Middle East and Africa turnover. CSE was very good, 17% revenue increase. You saw the revenue is driven by a RevPAR of 4%, so a big gap. The big gap is what? It is the fact that we were very good. Since we are very good, we got very large incentives because our properties are doing extremely well for their owner, and that is what makes a large part of the difference. The other element on North America is the picture that you saw, the Fairmont in Austin, which now is added to the revenue and contributes significantly as it is a 1,000-room hotel. South America is up 13.8% like-for-like. Again, the good news about South America is that Brazil is turning around. The perspectives are positive. This is definitely a good news for the future. On a per segment basis, luxury now represents 38% of the management and franchise revenue. You have seen that our pipeline is more and more skewed to our luxury, so you should expect that number to continue to go up. If I move to new businesses, the new businesses growth was a not-so-good number of 2.4% like-for-like. When you look at it on a reported basis, it is a much nicer number because you end up at 49%, but this is on the back of the three acquisitions that we did in the year, Gekko, ResDiary and Adoria. The very good news is that those three acquisitions are positive. The very good news is that D-EDGE, which is the new name of Availpro plus Fastbooking, has turned into positive territory in term of EBITDA generation. The very good news is that the Gekko that we acquired has doubled its EBITDA year-on-year, and so very good profile and a very nice acquisition that we are very satisfied with. The reason for why the growth is only at 2.4% is, as we have told you, we are working on onefinestay and John Paul and turning them around. As part of that, we are rationalizing the portfolio and we have notably, just to give you some color, reduced the onefinestay inventory to the tune of 30% plus, by taking off the rooms that were not profitable, hence the fact that the turnover is down. But this is the way to move ahead and go towards our guidance of a Q4 of 2019 at breakeven. So that is on new businesses. Quick snapshot on hotel asset. Frankly, again, great performance. I am sorry to be a little bit repetitive, but, to have a 9% RevPAR and an 8% growth like-for-like on this hotel asset business is, in fact, much better than the guidance we provided at the CMD. This is on the back of two things. Orbis, which is Central Europe, Eastern Europe businesses, which has been very good for the last two years, double-digit RevPAR, and continues to be good in 2018. It is also Brazil, which has turned around. So these two elements explain the very good revenue growth. The numbers, if you were to look at them, not on a like-for-like basis, but on a reported basis, are 44% up, and this is due to the acquisition of Mantra and Mövenpick, which get added to the scope and are significant assets. I think, now that we've covered how the top line of the business has been behaving, I'll go into the dynamic of our profitability and our EBITDA generation. The group EBITDA grew 8% on a comparable basis. There was, on a reported number, a change of 14.5%. The difference is again, M&A. M&A, to put the numbers square, is EUR 72 million of additional EBITDA in the year. You may recall, it's 30% of our bridge from EUR 600 million to EUR 1.2 billion. The integration of this M&A is a critical part of what we will continue to do next year and the year after. Then the FX, which was negative, as I had mentioned. Negative to the tune of EUR 23 million. Pretty significant number this year. Hotel service, like-for-like, EBITDA growth of 12% to reach a number above EUR 700 million. Here, when you take hotel service and put it with the holding, you've got this number on the table. You see a like-for-like growth of 10.7%, perfectly in line with the 10%-12% guidance that we had given to you. If we move to hotel assets, the like-for-like growth is 9.5%. Again, nothing to report here, only good news. You may recall, we told you that we would expect on a normalized visit to be between 5%-7% range. New businesses, the last is at EUR 28 million, which again, is very much in the bracket of the EUR 25 million-EUR 30 million that we had guided everybody during the year towards. The EBITDA for holding and interco, that reflects, in fact, the reinforcement that we are doing on the holding teams, notably in term of skills, but also in term of systems. This is part of the transformation that we are going through, to be the best in our new asset-light world. Last but not least, just for the sake of being crystal clear, in the like-for-like computation, there is EUR 30 million impact on the fee structure signed with AccorInvest, i.e., you may recall that when we did the publication back in February, we did tell you that in the negotiation with AccorInvest, we exchanged fee against duration. This is a number that we want to highlight because it is EUR 20 million this year and it is EUR 10 million next year. No news here, but just to be absolutely clear that everybody has got the right number in their modeling. M&F. Same focus that we did on revenue, looking now at the crux of what makes our business, i.e. the M&F EBITDA growth. Globally, you find here numbers which are very much again in line with what you would expect following the revenue growth that I covered. I'll go relatively fast here. In Europe, you are doing better in term of EBITDA than you do in term of revenue, because we've launched that Make Europe Again Great program under the leadership of Franck Gervais. As part of that, we've been making sure that we control the level of hiring. You have some benefit already coming from that cost-price sizing that we alluded to when we did the CMD. You may recall, and I will recall to you that in the EUR 600 million bridge that we provided, there is EUR 65 million that comes from high sizing. As part of the high sizing, this is a first element of it that you see in Europe. In Asia-Pacific, it's a timing. It's the fact that last year you've got a very positive receivable recovery, so you compare your numbers on numbers that were one-off last year and very profitable or very positive because of that one-off. The comparison is just on the back of a very good number. In MEA, you've got the reverse, i.e., we are very good at recovery from old receivable. We've got a new management team in place which is really focused on receivable in Middle East and Africa, and this is paying off. In CAC, in fact, this is some accrual that we took for litigation, and so that's why you've got this differential between revenue growth and EBITDA growth. In South America, great numbers, 23% like-for-like growth, and this is coming from us being very good and getting incentives, just like I was alluding to when I talked about the revenue in North America. A KPI that we decided now to show you systematically, and you can see why we want to do that, which is the adjusted EBITDA. If our number, our IFRS number, our EBITDA is EUR 712 million, the adjusted EBITDA is close to EUR 1 billion. The adjusted EBITDA is when you take all the equity consolidated stakes and reconstitute what their contribution at the EBITDA would have been. The reason why it is so significantly different is because of AccorInvest. AccorInvest is now a 35% owned joint venture, if you want to call it like that, or equity investment, I should call it better. This is significant, and that contributes to EUR 146 million for only, by the way, seven months. Huazhu, because Huazhu, which is our partner in China, was the right partner because they're having a great ride. In fact, because of that partnership and that work that we did with them, we were able to grow this contribution by EUR 42 million. So the strategy by which we found a partner in China was the right one, and it is paying off. The other line gathers all the other investment, because as you know, we've got series of other investment. You've got the names here, and these account to EUR 78 million. So not a neglectable number. I move now to the line, the dark side of the P&L, which is the line below the EBITDA, so the one that people understand less or don't want to really understand well, I don't know. In all cases, you will see that in our case, it is always an ordeal to go and explain the variances, but I'll try to do that for you. First off, we start with a EUR 2.2 billion net profit attributable to a shareholder. So there is the explanation. The EUR 2.2 billion is driven by the accounting gain that we did on Booster. No news here. This is the numbers that we have been publishing in H1, but that's the first, I should say, very significant number. The other thing that you see here is the non-recurring item to the tune of EUR 400 million. This is made of one thing that you know, which is the impairment charge that was taken against new business intangible at the end of H1 to the tune of EUR 246 million. Something that you don't know, which is that restructuring that we have been discussing and cost-price sizing this 10% bucket that I alluded to earlier on when I was talking about Europe and the Make program notably, accounts for EUR 90 million of this EUR 120 million restructuring cost. That's the cost that we pay in order to transform our organization. The payback that you will have around that restructuring is a very good one because it's to the tune of 2 years. The other line, which is not quotable here is the finance expense. The finance expense, there is a mix here between one-off for foreign exchange impact from the Booster entity, very significant entity restructuring that we did, with as an offset the fact that we did some refinancing of the bonds in 2017. What you need to remember here is for modeling purposes or to understand the company on a normalized level, the normalized level of interest is EUR 50 million. That's I think what you need to remember. Share of profit is up. This is coming from AccorInvest. Income tax, very complex story, because last year, in fact, we had a credit for EUR 43 million, and this year we've got a debit for EUR 119 million. Last year was a very special year because the E.U. did some harmonization in term of dividend law. The U.S. tax reform significantly changed the tax rate. We had on top of that, all the boosting tax restructuring. That provided very significant one-off. We went through all of that last year. This year, what you see in the number is, or in the rate I should say, the effective tax rate, is the fact that some charges are non-deductible, and notably the impairment of goodwill on the new businesses. I am happy to go into more details for those of you who are interested. I'm not sure of how many I will have, but I am happy to do so. Moving to cash. Cash, cash. Very strong cash conversion, 83%. Now why is that? First off, we had a great EBITDA ride. We had EUR 100 million EBITDA, and you see that at the recurring free cash flow, we also more or less had EUR 100 million of EBITDA. This is coming from the fact that we've controlled the lines that could fluctuate, like working capital, good performance on working capital. The recurring investment is the one that helped, in the sense that EUR 124 million is the number of recurring investment, and it is lower. It is less of an expenditure that what we would typically expect on that line. You may recall we said EUR 200 million to EUR 250 million, and it's essentially the timing of some negotiation and timelines. You should not take the EUR 124 million as the base for modeling and for understanding our business in the long run. The EUR 200 million to EUR 250 million is the high target, and this has been driving part of the great result on cash conversion. Proposed dividend. We have a very clear formula to compute dividend, which is we take 50% of the recurring free cash flow. If you were to do that computation, you would arrive to a proposal for ordinary dividend, which is EUR 0.94. What the board has decided is to propose EUR 1.05. Why? First off, you may recall that we have been distributing EUR 1.05 for the last two years. The level of confidence that the management and the board has of the company, is that we felt that this was kind of a transitory year. As we are very confident on our capability to drive the numbers, the board decided to propose a EUR 1.05 dividend per share. Mechanically, over the next years, as we ride that curve of growth of EBITDA to the EUR 1.2 billion, the number would adjust itself anyway to those kind of numbers. This is a proof of the confidence that we have got in our path to the EUR 1.2 billion. Small numbers, but numbers that matter. Now cash. We provided that bridge back in H1. We updated it for you. The net level of debt is at EUR 1.1 billion from EUR 1.9 billion. You see very well on this scheme, the EUR 4.8 of the cash proceeds. You know about the EUR 2 billion orange bucket of the M&A, because we discussed that before. The two things that are to be highlighted here is Orbis. We have this EUR 339 million of the Orbis tender offer that we completed in January 2019, which is showing up as a liability into our balance sheet at the end of December. You have got in the same vein, EUR 850 million, which is the share buyback. This is IFRS, I think 36 or 32, can not remember, which means that you have got to accrue what you know that you will be dispersed. All in all, I think this is a very readable table in term of what we did with our cash, which is very much in line with what we said that we would do, i.e. M&A, share buyback, and pursue the transformation of the company toward the asset-light, i.e. the Orbis strategy. I am moving now to the balance sheet. You saw that in January we did a refinancing exercise to the tune of EUR 1.1 billion. I would like to pause here a minute to tell you that at the end of December, we have a great balance sheet. This is an extremely comfortable element for us to drive our strategy, because we can weather a lot of, I would say, market conditions and favorable situations. So we have a strong balance sheet, and this is a most definite great asset for the corporation going forward. What we have done, because we are never satisfied, we did even better. We further improved that balance sheet through that transaction in January. You can see the effect of it was in fact to reduce the cost of funding at 1.8% from 1.9% at the end of December. This is mostly fixed rate, by the way. We increased the duration from 3.6 to 4.8 years. Very strong balance sheet, and I would like to take also this opportunity to emphasize our commitment to investment grade rating. Last slide for me. I think what you have seen throughout the various slides I went through is the very solid performance of 2018, and that gives us comfort on how we are going to go through the ride of going to our 2022 EUR 1.2 billion EBITDA target. We opened a record number of rooms in 2018. That strong momentum is what gives us confidence about the 5% system growth target. We will continue to integrate this acquisition, and you have emphasized how critical those acquisitions are at the strengthening of the model and the delivery of value. We are definitely on track to our EBITDA 1.2 target. We have also demonstrated that we can convert that EBITDA into cash. So very much happy with the asset-light model, and we will execute what it takes, whether it is the cost rightsizing, whether it is the evolution of marketing forces, sales forces, strategy around all of that, to make sure that we deliver to you this 2022 target. Just cherry on the cake, IFRS 16 will come into force in the account of 2019. We provided you a slide on that in the appendix of the presentation so that you have the reference. It is about EUR 1 billion of additional debt on the balance sheet and EUR 100 million of additional EBITDA in the P&L. Thanks very much for your attention, and I will pass the floor back to Sébastien. Merci, Jean-Jacques. Okay, so let us go still quickly. I got a lot of, actually, messages from friends. They actually even awake in São Paulo watching us and our friend in Singapore, Monsieur Graham, Monsieur Goh Have, Monsieur Michael Issenberg. Thanks for being with us and all the crowd in Singapore. We are going into what I told you at the beginning, which is away from numbers. Now we go deep into what we do day-to-day, which is servicing guests and being at the service and helping our own clients and obviously our own employees. Four or five slides, that is about it. Then I will come back to you at the end of the session. First slide here is, again, what I told you 20 minutes ago, but I do not want you to forget about it, and I do not want me to forget about it. Talent culture is probably 20% of my time and priority for the next 12 months. Why? Because I want my employees of Accor to shine, to be less humble, to show muscles, to be happy with what they do, and basically to be even better at what they do every day. I want also to retain all those key people, and some of them leave the firm because we have not listened to them properly, because they are leaving of bitterness, because they wanted more and greater mobility or better career enhancement. We have to listen to them. We have to keep them. There is too much of a cost of losing 50,000 people every year, and too much of a cost of hiring 80,000 people every year. So better job on retaining those exceptional people. There is also a greater effort to be made on training, getting them savoir faire, and basically giving them additional educational baggage. On top of it, you know it, I said it so many times over the last few years. We went from real estate heavy to asset light. We went from very European-focused to today global. We went from having probably dozens of different missions on behalf of the hotels done by 6,000 superb headquarters staffs in different headquarters, whether they are in São Paulo or in Zurich or in Melbourne or in Munich or in Paris or in Warsaw. It is time to revisit the numbers of missions, the cost of those missions that we render on behalf of our hotels. We have been able to hide it a bit until we had 900 hotels ownership part of Booster. Now that I guess we are 94% asset light, we just have to accept that some missions we have done for the last 50 years should probably end. Maybe they would be better done, handled, cheaper cost, better technology elsewhere. So there is an enormous effort, which is tough, by the way, to implement at the same time we are showing EUR 500 million of recurring free cash flow, but we are in a process of downsizing, rightsizing numbers of mission and numbers of people in different headquarters, which is why you have seen in the P&L a EUR 92 million cost for transformation, which is basically the way we can honor different promises and be transparent with those people who are no longer going to be with us in the next few months or few years. Second column, again, distribution loyalty. I am talking about those two, and those are very different elements, by the way. Distribution is global sales. Markus Keller is a hell of a guy. He is in charge of it, but we have to go much deeper and being a better, more agile traffic provider to the 4,800 hotels of Accor. So do we have to be better and with more seamless, more facility, more transparency, more visibility, more notoriety on the Le Club AccorHotels, who is dying to basically be reinvented with a new program that Maud will reveal to you in a few minutes. Better frequency, better usage, better interaction, more emotional. The last are the brands. You know we have two different kind of brands. One is that logo here, the employer, corporate brand, the one you buy in or sell stocks, which is AccorHotels becoming Accor. Incredible, powerful brand in many different jurisdictions because this is the brand owners talk to first. Then within the Accor portfolio, they see the Sofitel, Pullman, and Raffles and ibis and Novotel of the world. But we are spending much more time on Accor. We are not spending more money on Accor. We are just spending the time to understand this is not a B2C brand. It is a B2B, so it is addressed to owners, but employers are very happy to work for Accor. When you go to many places on the planet, which I do four times a week, when you meet with somebody, whether it is in South America or in Russia or in Korea or in Nigeria, he will tell you he works for Accor. He will not tell you, "I work for ibis," or, "I work for Novotel," or, "I work for Pullman." Why? It's because in many of those people, they are grateful that they will move from different countries. They will move from different brands, and they basically look at themselves as being an Accor proud employee. There's a different set of brands, which are commercial brands, those where people pay you a fee to manage, a fee to provide traffic, and those are the 33 brands of Accor, where we had 12 some years ago. Within that portfolio of brands, and Steven will tell you as well, there's some very good global brands and there's some very good regional local brands. The effort is not the same on the global brands and the regional brands. That will be a topic demonstrated by Steven. This is just to remind each of you, and we only put four, and we probably could have put 33, but not enough space on the table here. Every year passing, which is a great KPI, we are increasing guest satisfaction. Thank God. Clients are year after year happier and more satisfied staying with us. On the right side, it's a number of loyalty members. Those numbers are extraordinary in terms of additional members per year. 50 million today, 25 million only four years ago, and that program started in 2008. Programs on loyalty from American Fellows started in 1983, 1987, i.e., more than 30 years ago. Ours is only 10 years ago. So good news, we're catching up. You're going to be looking at a slide with Ian on comparison between American Fellows and us. There's a but here. We have many more numbers of loyalty members every year, which is satisfactory. While it's only a good thing if you transform it. It's only a good thing if they become active. It's only a good thing if they increase the numbers of booking going through loyalty members into a system. It is not increasing enough. So there is an enormous diagnostic, which is being put together by Maud and Ian and new talents, which Ian is one of the new talent. Steven is one of the new talent in which we just have to face reality. Having a greater number of loyalty members means absolutely nothing if you don't engage with them in a more frequent manner. But I was looking by preparing this presentation on what is it that we have done over the last five and a half years I was here. I'll tell it as harsh as I told it internally, which is not on the slide. I've been in my position for the last five and a half years, and we're spending roughly EUR 150 million in marketing every year. You do the math. Put only five years, five times 150. You end up with EUR 750 million spent over the last five years as me being a CEO here. I've been asking everybody around me, owners, clients, you, people of Accor, give me three or four things that you retain as being super powerful that you remember on what we have done in putting a footprint on marketing. Give me the three. I was waiting and waiting. The one common thing who came back almost every cases was this, AccorHotels Arena. People say, "Oh, yeah, we've done AccorHotels Arena." Well, thank God we did, we've done it, because it's probably one of the best investment we'd have made over the last 3 and a half years, is the youngsters, those who actually did not know of Bercy, POPB, as we say in France, now 37% of them, the only thing they know is AccorHotels Arena. Plus, I'm going to make their job easier if we can actually get the permission, then I guess we're going to be dropping hotels. So it's going to be Accor Arena, which is even stronger. Great notoriety, 1.5 million, and probably 60%-70% of that 1.5 million never entered a hotel of Accor. All of a sudden, they see Accor, they have a great experience, they remember where they were, and you see all the media, all the ticketing only talks about AccorHotels Arena. That was a damn good initiative. All the rest was, I'm sure, Monsieur Graham, you in Singapore and other commercial officers in many countries, I'm sure the money was invested wisely. No doubt about it. We're doing blackboard, we're doing TV advertising, we're doing social network. It's just that I guess I don't remember it. If I don't, many other people don't even. Which explain to you what's going to be said in more details by Ian and Maud, we have to go and making a footprint. We have to be bold. We have to be audacious. We have to show muscles. We have to shout to the entire world that the days of Accor not being present are just over. Why not being daring and having our name as big as you could see Danone, Total, Coca-Cola, McDonald's of the world. We are the biggest hotel operator on the planet. We basically service 265 million clients on the planet every year. It's almost one million people a day. Why can't we just admit it, talk about it, invest basically in what matters the most and basically show who we are? Because that's going to have huge implications on transforming, basically, loyalty members into active members. It's going to have also impact on RevPAR, on awareness, and mini drop-through, which we're going to talk about in a minute. So decision made this morning is a very wise, well-studied, interesting use of capital with an exceptional return on the money. Yes, there is some short-term effect. Well, that's what it takes when you're moving a company, is you have to dare to make those initiative, not basically to be left behind. This is what I want to overcome and to fix because it has to be fixed, which is first, we need to transform. We need the 30% of booking coming from loyalty members to be in the north of 40%. Americans are in between the 45%-55%. Why can't we be at the same level? They just have to know that program exists. They have to be able to use it, and it has to be better displayed, and it has to be one common universe between the digital platform, the loyalty platform, the service platform, and obviously all the different non-hotel agencies as co-working as John Paul, as onefinestay. We have to put our brand out. It has to be visible. You only get partnership. Again, that's going a topic you're going to see in a minute. We are very, very bad in the revenues from partnership. You'll see the numbers, and I've talked about this in the CMD, those days are over. I want to have tens of millions coming from partnership. Partners only come if they see your brand. No partners from credit card, from car rental, from aviation, will connect with you with Le Club AccorHotels because you never see Le Club AccorHotels, only those who have the card. It's not in the ads, it's not in the minds, it's not in emotional, it's nowhere. So spend the money, be visible. I guarantee you, those guys will be there to connect with you because they will need you as much as you need them. Doable, feasible, and calendar is short, and you're going to be very much surprised by what's cooking. The last is let's stop being transactional. What we have talked about with our customers for the last 50 years is points. I'm going to give you a cocktail. I'm going to give you a suite. I'm going to give you miles. Yeah, that's wonderful. Those are indispensable. The people don't remember the cocktail they actually never drink, or they don't remember the bottle of wine or the chocolate or the flower because they're not going to be carrying the book because the book is too big to put in luggage. So stop giving a book that people don't carry just to make you look good and feel good because the clients doesn't basically appreciate it. So give them something they cannot buy. Give them access to a Paris Saint-Germain players lounge. Give them access to a concert backstage. Give them access to many things that they will talk among them, and they will be very happy to use their miles, to be one of the few. That's all the direction we're going. Funny enough, you saw yesterday morning, and I actually got a kick out of it, and I smiled when I saw yesterday Manchester United signing some kind of a partnership with Marriott the exact 12 hours before we announced this morning something much deeper, much stronger with our friend Paris Saint-Germain. Plus, for those of you who wants to smile, good news is, we're going to have a match on March the 6th because this is a return game between Paris Saint-Germain and Manchester United. So it's going to be ALL against Bonvoy, and it's going to be Accor against Marriott. So on social networks, we're going to make something fun out of it. I hope Arne won't mind, but it's going to be kind of actually European competition here. Transformation is engagement, which is stop being transactional, get into people's life, be emotional, give them an experience. Nobody is a number. They are a person, whether you are an employee of Accor or whether you're a guest of Accor. This is all the bricks, all the things that we built over the last four years. None of them are anecdotal. You see the first circle, ResDiary, and onefinestay, and John Paul, and Gekko, and Paris Society. All those bricks are different in natures. They are either in restaurants or in nightclub or in co-working or in sharing economy, apartment. Those are extraordinarily additive to the new loyalty program. Then you see the 33 brands, then you see the partners, which is what was announced this morning, whether it is AEG, whether it is IMG, whether it is our friends from Paris Saint-Germain. That is the piece I want to go from today, a minuscule number to tens of million over the last 2 to 3 years. Now that is the time. Time to wake up, time to show muscle, time to dare. But again, what we are announcing this morning has been well prepared over the last at least 9 months. It did not come overnight. It is just time to talk about it. Maud, floor is yours. Thank you, Sébastien. Good morning, everyone, ladies, gentlemen, and a special hi to all the fantastic Accor teams all around the world. I am going to present you with Ian Di Tullio and Steven Taylor, the new guest promise. It is all about loyalty and partnerships in one purpose. Reinvent our engagement strategy to better acquire, retain, inspire our guests, and completely rethink the way we are interacting with them. We want to create something new. It is time to dare, and we are going to dare. Because loyalty is at the heart of everything. It is a massive driver, a massive driver of our group's performance, especially in the hospitality industry. A massive driver of our direct revenue. It is also a massive driver of growth. The higher tier is a tier is, the more our customers, our members, are spending. They are clearly driving the business. Loyalty is also an amazingly powerful lever to support our international footprint with a double-digit growth everywhere. It is good, but it is not enough, because our guests have clearly told us they are expecting a new approach of loyalty according to their new expectations. I hope you remember that we already discussed that at the former Capital Market Day last November. People want more. They want, first of all, especially in digital era, simplicity and immediacy. Simplicity of rules. Let us use it in an easy way. Simplicity with clearly understandable commercial and loyalty terms. Simplicity also about having everything immediately, right now. We do not want to wait to get benefits because we are loyal. We want instant gratifications. The second major expectation is about seamlessness. Digital is simple and it is fluid. People want intuitive, easy-to-use interfaces with, for sure, more and more mobile device as a key interaction point in their daily life. They also want the beginning of the switch to conversational era with already voice search being here. Third expectation is our core know-how, personalization. Our guests want and love to be known and recognized, and we know how to do it because hospitality is about people, it is about care. People want to be known and recognized. They want to have a more personalized experience in the hotel according to their personal preferences. They want to even have the possibility to choose the benefits they are going to have through the loyalty program. Fourth expectation is the all-in-one ecosystem. The augmented hospitality that Sébastien Bazin has been building so far for the past five years. Look at all the other loyalty worldwide famous loyalty programs. It is not only about the core initial business, it is about a bunch of enriched services to offer more and more experiences to the loyalty members to better retain them because people are going to interact more and more with them by diversifying, multiplying the touch points, getting into their daily life as a true life companion. All of it to create inspiration. The pride to belong to a unique community, to experience unique and wow moments, and to, more than anything, feel recognized. This is clearly in the digital era what our guests want, and they are right to expect it from us. You know what? They want it all. Today at Accor, we decided all together to give them all. Imagine a lifestyle loyalty program on a single platform where you can live, work, and play seamlessly personalized to you. You, your style, your way. Discover a world of experiences and extraordinary partnerships, and be rewarded for all that you do every day on the move in one place. Welcome to ALL - Accor Live Limitless. ALL for one, ALL for you. This is ALL - Accor Live Limitless. Now I am going to introduce to you the Senior Vice President in charge in my teams of the guest experience and the whole guest department, Ian DiTullio, to get more in details into this new whole guest promise. Ian DiTullio has an amazing expertise on digital marketing, personalization, and loyalty. He has been working for big companies like Air Canada or Qatar Airways, and I feel blessed and we are super happy to welcome him on stage to better know about ALL promise. Thank you, Ian. Thank you, Maud. Thank you very much. All is all about being bold. It's all about being brave. It's all about being ALL. And ALL really is, it says what it is. It's ALL. It's an ecosystem. It's about connecting all the touch points. It's about frequency. It's about making our way into people's everyday lives. It's not a marketing concept. It's not a digital concept. It's not a loyalty concept. It's a customer experience concept. It's a concept that connects with customers, takes them beyond the transactional, to the frequency, to the experiential. It goes from a structural loyalty program, to a relational program, to an emotional program. It connects the dots of augmented hospitality. If you want to find out more about ALL, of course, I invite you to visit all.accor.com. This is where we'll be continuously updating you and our members on the full content of ALL. As you can see, it will be, of course, omni-channel. The program will touch every single platform, whether it's our website, our app, everything will be harmonized to deliver the experience our customers want and deserve. ALL, of course, comes with a new creative identity. You cannot go from a program which is largely transactional, like Le Club, and has worked for years, of course, to a program called ALL, which touches the emotions, the hearts and minds of our customers, without a new identity. You can see the identity here really calls out the depth of our bench. We are proud to announce the depth of our bench. We're going to be announcing it in really iconic locations, like Piccadilly Circus and a whole bunch of other locations yet to be, which will iterate as effectively on all social platforms as it will in traditional media. Of course, you'll see it at places that are travel-based locations, like airport, but you'll also see it in your everyday life. You'll also see it as you actually walk from home to work, in the tube or elsewhere. You can see here that it's a beautiful rendering. We're using the alphabet because we know that the number of experiences, the number of touch points we'll be offering to customers, will be as infinite as the alphabet. Of course, I talked about ALL being all these components, customer experience, digital, brands, all of it coming together. But there are, of course, structural elements. Let's not forget that loyalty has a purpose, to drive frequency, and some of that frequency is driven structurally by program design. We know that today, many of our customers are peaking, and I'm using that word purposely, at our platinum levels, where we have nothing else to offer. We will be introducing new premium status levels that will structurally incentivize our customers to spend and consolidate more, to drive more frequency in an augmented ecosystem in a way that makes sense to them and creates incentives that are aligned. In a second time, of course, or at the same time, I should say, we will be enriching the benefits. You cannot say new status levels without new benefits. But we will also be introducing incremental brands to the program, incremental services to the program. I am going to leave my teaser there because I want to have more to say and more to excite you with as we go. Through our research, and we have spent hours in focus groups, hours poring through the data, our customers have said, "You know what? The transactional piece, that is cool. I expect it. Points are all right. But what I am really missing in my life is a capacity to use those points to extend myself in everyday life into experiences. How do you wow me?" An expression I often use is, there is a loyalty currency and then there is experience as a currency. We are getting into the game of experiences as a currency. When you talk to our younger demographics, and frankly, that is bleeding into our older demographics on a daily basis, experiences are increasingly becoming the new currency of choice. Your capacity to tell how you engage with a brand and how that is changed you, to be able to share it with your friends and family through word of mouth or through social media, that has value. That is the currency we are pooling into. I already unveiled some of the cool stuff around the identity and the branding, and my friend and colleague here, Steven Taylor, will wow you with all that beautiful stuff a bit later. We are not just here to talk about experiences. We are also here to talk about money. The magic usually happens when you can actually marry profit and guest engagement. When you actually invest money behind a concept which has a proven return and will actually directly connect with our capacity to drive frequency, retention, and satisfaction of our member base. That is why we are specifically talking about memberships being at the heart of what we consider to be the next generation of guest engagement and group profit generation. It really is a really accelerating loop, and it will touch things as varied as payment to get into the everyday lives of our customers. It will touch points where they are traveling on the move, such as airlines, rideshare. It will touch local activities. Or if you are home, we will actually give you a reason to actually experience ALL. We will offer you unique experiences because, of course, the transactional needs align with the experiential. Here is the money slide. Of course, Sébastien, it is great to come after Sébastien because, of course, he is a great presenter and he engages you, but then he takes all your thunder. I think he said a lot of the great stuff I was going to say. Clearly, what you can see here is that we have a young program. We have 50 million members. That is nothing to sneeze at. It is still about half of what our larger competitors have in terms of a customer base. Our customers today have not achieved a level of contribution that is similar to our competitors. Our competitors are, frankly, we should be in the range of 45%, as Sébastien mentioned. That should be a natural point for us. We are strong in our markets. We actually have a new program ambition, which will create attachment, engagement, frequency, retention, and direct connectivity to more direct channels. It will give people more reason to choose us. When people have more reasons to choose us, it creates an accelerating effect. ALL is an accelerator as it pertains to our member base, as it pertains to our contribution, and as it pertains to our capacity to attract partners. Why is that important? Because today we are generating $6 million in partnerships. That is just not acceptable when our competitors are generating anywhere from $250 million to $600 million in top-line revenues for partnerships. Of course, the bulk of that will be in the payment space. We all know this. We've actually brought in some significant talent, and I'm not talking about myself, but we brought in some significant talent that has deep expertise in this space from companies like American Express and American Airlines, where frankly, they've done damn well in driving some of these metrics up. Now let's talk about specifically how we're going beyond this stage, how we will be engaging people in a higher frequency, multiplied touchpoints kind of manner, how we're going to be increasing conversion through some of these relationships. It comes down to 3 engagement types. There's the everyday engagement type. We're talking about payment, co-branded credit cards, conversion programs. We're talking about home entertainment relationships, retail and food delivery. We're talking about engaging with people when they're on the move, whether it's actually in a local mode or whether it's through an international mode with airlines or car rental. Of course, we're going to engage with them everywhere, where they're actually situated at home on their couch or whether they're actually situated in one of the wonderful locations where we have so many of our hotels. Of course, engaging with them through partnerships is one thing. We need to make sure that we actually engage with them on the right passions. We haven't invented these passions. These are the passions our customers told us they wanted us to pursue. These passions are passions we all experience in this room. Our customers have told us they disproportionately want to explore passions that are related to dining and culinary, to entertainment, and to sport. These passions are going to be delivered to us through a number of amazing global partners. As you know, IMG is a global organization. They operate in 30 countries worldwide, and they are leaders in events, sports, and media. They also happen to operate an amazing platform, which is called Taste Festivals. What better platform than to use Taste Festivals to engage with food? We will actually be partners with IMG in locations such as Toronto, São Paulo, Paris, London, and of course, Hong Kong. You can see at this point, we are actually starting to have reach in the experiential space, as Sébastien mentioned earlier, that extends beyond the AccorHotels Arena and starts touching the hearts and minds of our members in core locations where we have our properties. These experiences will include things like master classes with chefs, culinary encounters, fast-track to these events. For those of you who have been to Taste events, they're absolutely extremely engaging, and they're multi-day events. They're not one time. They actually persist, and they actually drive quite a crowd. The second partnership I'm proud to announce is AEG. For those of you who know AEG, they're based out of L.A. AEG has about 100 million guests attending its venues on a yearly basis throughout the world. AEG is an expert in sports and live entertainment. With AEG, we've actually secured 60,000 tickets and private events, suites, VIP-type experiences worldwide in South America, Europe, and Asia. For those of you who don't know, of course, our first relationship with AEG was with the AccorHotels Arena. This is an extension of our relationship, and we actually start counting the number of interactions we'll have with customers through experiences. We're talking about north of 65,000 additional experiential contact points that go beyond the transactions into people's passions on a yearly basis. If you don't tell me that that's not going to drive earned and owned media in a space where people are incredibly passionate, I don't know what will. The third area, of course, is sport. Announcing this to you after the press release is not as exciting or after Sébastien is not as exciting, but of course, our third passion area is sport. As a Canadian, most people would think that I'm mainly a hockey fan or a hockey player. But there is no sport which is more engaging at a worldwide scale than football. Paris Saint-Germain is a leader. I'm actually passionate about this club for many reasons. I'm passionate, of course, about this club because of what they demonstrate on the pitch, but also what they're demonstrating off the pitch. Their incredible rich ecosystem of digital experience, their depth on social media, and frankly, their innovation as it pertains to how they're engaging with their customers. Our engagement with Paris Saint-Germain, as you know, is to be, of course, their primary sponsor, their jersey sponsor, but we would consider ourselves to be their primary experience sponsor because we believe that we will introduce Paris Saint-Germain, just like we've done with AEG and IMG, into the everyday life of customers. PSG gives us an amazing trampoline. It allows us to gain massive exposure for the upcoming relaunch of ALL. It allows us to introduce and capitalize on unique experiences here and in their tours abroad. Lastly, of course, it drives massive brand awareness at a time where we need to boost the awareness of ALL and at a time where we're increasing the value proposition to further consolidate the share, the frequency, and the value of our customer base. Of course, a lot more details will be unveiled on this relationship tomorrow at the Parc des Princes. So stay tuned for that. This is where my clicker freezes. On that note, I think as you gentlemen sort out what's happening in the back, I will pause and hand over to my friend, my colleague, Steven Taylor, and my partner in crime to make all this good stuff happen. Thank you, sir. Good morning, ladies and gentlemen. I don't know about you. As a Scotsman, I'm certainly looking forward to supporting a winning football team for once. I think 1998 was the last time that Scotland actually qualified for a World Cup. Looking forward to supporting Paris Saint-Germain moving forward. Thank you, Ian. Thank you, Maud and Sébastien. It's a real pleasure to get the opportunity to talk to you all about how brands and how our brand strategy is going to drive consumer engagement and ultimately drive business impact. To start off, it is important to reinforce that brands drive value, right? Brands drive business impact in many different ways, right? They drive competitive differentiation. They drive consumer engagement and preference, which then drives business impact. They drive owner satisfaction. I've spoken about this brand strategy that I'm sharing with you all for many months with our franchisees in Southern Europe and across the world, our owner community worldwide, and they're incredibly excited by this plan. It drives pipeline growth and ultimately even drives employee satisfaction and retention. Brands drive value in many different ways. The way we depict this, the way we describe it is our brand equity and growth, virtual or virtuous circle. The idea is pretty straightforward, whereby if you spend money on your brands and you do so wisely, you increase the brand equity of the brand. That in turn then increases business performance, which then allows us to approach new owners to increase the satisfaction of existing owners, which then drives the pipeline, which drives fees, and then ultimately gives us more money to spend on the brands. It's a virtuous circle of equity and growth. What we're announcing today, and I've worked in the industry, I'm dating myself a little bit. I've worked in the industry for 20 years. What we're announcing today is probably one of the most significant and meaningful investments in brand marketing strategy for the last 20 years. It's a huge driver of our asset-light business model. It's a big moment. The two key words that I would reinforce is that we are going to be very balanced and very focused about how we spend this fund. You can see that from the numbers on the screen. We have over 30 brands in our portfolio. It's the most comprehensive brand portfolio on the planet. It allows us to engage with every different type of consumer need and lifestyle. With this investment, we are very focused on driving a return to the business. We're focusing on seven global well-established brands that represent 88% of our fee income. We're focusing the investment on seven brands only. We're also focusing, but in a balanced way, in nine major countries, representing around about 75% of our customers worldwide. Nine markets when you look at the paid advertising, but reaching customers worldwide. A truly global benefit. We're doing this over a two-year time frame. A real support in the short term to our asset-light strategy driving business impact. This gives you a little bit more details. Again, I'll use that term balanced and focused again. If you look on the left, what you would see is we're investing over 50% in what you would say are our legacy mid-scale and economy brands, ibis, Novotel, and Mercure. They drive over 50% of our fee income. They remain a core part of our business. We are going to invest in those brands moving forward. However, what you'll also see is we're investing in our luxury and premium brands. That's where we see the growth in our portfolio. So brands like Raffles, a North American icon like Fairmont, a renowned European brand like Sofitel, and then a brand with incredible growth trajectory in Asia, Pullman. So a real well-balanced investment across the brand portfolio, going from our most luxury brand, Raffles, down to our best-known and loved economy brand, ibis. On the right-hand side, what you'll see is the country split. I'm not going to talk through every single country, but what again, you will see is a balanced approach. We're focusing on our core key feeder markets to make sure that we drive a return on investment in the short term, so focusing over 50% of the fund in Europe, but then also focusing on the future, on high growth markets, targeting affluent, high-net-worth individuals in Singapore, in the U.S., in China, in the Middle East to make sure that we drive our luxury and premium brands forward. What you'll also see is that we are planning a real series of not just brand campaigns. One of the key things I really want to reinforce here is this is not just an advertising spend. What we're talking about here are fundamental brand relaunches that are going to transform how these brands are perceived and how they perform in the future. We're going to start relaunching. In fact, we already have started relaunching these brands this year. ibis, we announced the relaunch of the brand in January 31st in this very room. We're announcing a relaunch for Sofitel at the end of February in just one week's time. So we're going to be relaunching our core global brands over the coming year and a half, which should have a huge incremental effect on our performance and again, support our asset-light strategy. Now, I wanted to talk just briefly about ibis because again, it gives you an example of really the breadth and depth of what we're doing and reinforces that this is a holistic relaunch of our brands rather than just a paid advertising campaign. So this is an important slide, and not to dive into too much detail, but ibis is one of the best-known brands on the planet. It's an economy category killer. There is no global competitor like ibis, but it needs rejuvenation. So what we have done is we've developed a new position that positions the brand as a vibrant lighthouse, trying to position it as a social hub for the local community and travelers alike. But we're not doing that just through a brand advertising campaign. I will show you the film that we're launching in April. We are also doing this through a new design philosophy, creating blended living spaces to connect to locals and travelers alike. We are doing this by focusing on brand activation through our people. The heart is a talent that we have in our hotels, creating a warm opening culture for our guests. Then we are also shifting, and Sébastien talked about this a lot. We are shifting from a functional positioning to an experiential platform using music as a way of forging a deeper emotional connection with our customers. So all of this works together to reposition the brand, and then we will activate it in non-conventional ways. Yes, we will have paid advertising through TV, through print, through video online, but we are also working with non-conventional channels like partnerships with Spotify and Sony, sponsorships with Sziget Festival, influencer engagement, PR, social media. So a really holistic 360-degree approach to brand management, brand rejuvenation. It is indicative, it is reflective of what we are going to do across our other brands. So I will share with you the campaign now, but just to give you a little bit of context, and it reinforces again what Sébastien said and the shift that we are making from talking to people around the function and the elements of our property, the hardware, and really trying to connect with them on a deeper, more emotional level around shared passions and shared values. The value that we have chosen, which we think we have great credibility in ibis, is openness. So openness is a very important value at this moment in time in the world. It is a value which at times feels under threat. There is so much emphasis on diversity, on equality, on inclusiveness, that brands and iconic brands like ibis have to stand up for what they believe in. That is why we think we find a really interesting territory to connect with people on a deeper level, and that ibis say that we are open. So enjoy this film. It is a mood film, but the real film is launching in April this year. Play video. Hello. Hello to those who say hello, rather than goodbye. Hola, then adios. Those who keep an open mind and trust what their eyes might find. Those for whom cages are made to be escaped. Those for whom rules do not apply. Those who do not qualify. To those who love an unexpected endeavor, those who see nothing strange in being a stranger. Those who do not use labels. Hello to those who see no trouble to travel. Those who think curiosity does not bite. Those who can fall in love at first or second sight. Hello to those who welcome friends and fight cliches. Hello to those who make an adventure out of every day. When the night comes, it is their time to play. Hello to you, to her, to him, who know that the world, like life, has never been flat. And even when there's rain, live again and again and again. Thank you, Sébastien. He's the biggest fan. Thank you. Listen, that gives you an idea as to the fundamental shift, right? And you've heard it from Sébastien, you heard it from Maud, you heard it from Ian. Hopefully, you're hearing it from myself as well. There is a fundamental shift at Accor, how we are looking to build deeper relationships with customers. We're moving from the traditional hospitality way of bombarding customers with promotions and tactical aspects of our properties, and really seeking to forge a deeper emotional connection through shared moments, shared passions, shared experiences. As I said, I've been in the industry for 20 years. I've actually lived and worked across four continents. I've worked for some major multinationals based out of the U.S., in the U.K., in China, and in the Middle East. Really what we've announced today and what we're planning to bring to life over the coming year is, I think, one of the most audacious, ambitious shifts in consumer engagement strategy, certainly in the last 10 or 20 years. So we have a huge ambition. We're going to create this holistic ecosystem of value around our customers, consisting of world-class brands, consisting of experiences, services, partnership, and create this walled garden around our customers, which will then not just drive consumer engagement, but it'll also support our asset-light business model and ultimately drive incremental revenue and fees for years to come. So thank you very much for your attention. I'm now going to invite Jean-Jacques, I think, back on stage to talk a little bit about how all the economics behind this works. There you go, sir. Thank you. So I have the privilege of summarizing what my, I like your term, partners in time have been developing. I think on a more serious note, when we're entering a new phase of this corporation life, this Accor asset-light strategy, and put in place a new way of working for the corporation. We had EUR 4.8 billion of cash that came from the monetization of the AccorInvest or Booster assets, if you will. As part of that, we've looked at how do we create most value. We've explained to you what we do in share buyback. We've explained to you what we do in term of merger and acquisition and reinforcing values line of businesses. As part of the reflection that we went through, we thought that one way to further strengthen the $1.2 billion EBITDA guidance that we provided back at the CMD and make it a number which is both stronger and bigger, was to go through that marketing and sales and loyalty investment that was presented to you. I think that by now you must have understood, sorry, the benefit of doing all of that, and I'm going to just put together some of the rational and numbers of the investment. What we talk of is a $225 million investment, which would deliver $75 million incremental EBITDA at run rate. What are those $225 million investment? Part of it is in the loyalty program, part of it is in partnership, part of it is in brand marketing. I think we went through that, and that's in fact one way to summarize what we go and are going to invest the money into. How do we benefit from that? I think you saw it very well in the chart of Ian. You saw it on some of the KPIs that we've been assessing our performance against and determining that we really needed to move up the ladder. One of it is the loyalty contribution. You have that picture that says that we are in the ballpark of 30% of contribution of our turnover, which is provided by card owners. Our ambition here is to be north of 40%. Back to where the best of breeds are on that KPI. The other thing that was very clear in that same table was that we have a very limited number of partnership. We talk about today, EUR 6 million. This is dismal compared to what some of the other guys have been able to do as they also focused on those initiatives much earlier than we did. Our ambition here is to basically say that this EUR 6 million will be north of EUR 100 million of partnership when we are at cruise speed. The last but not the least, and probably the most obvious one, is that the circle that was so well depicted was on the virtuous way this business work, is that when you are making your brands more knowledgeable to the end user, you're obviously getting a premium, and this is bringing you additional RevPAR. The quantification that we've done is that we should be able to get a step function over time, an increase, I should say, of 3 points, which is a step function that you would then maintain of 3 points of RevPAR. You will gradually be able to increase your RevPAR to a level which is 3% and then sustain. That would come from all the exercise that we do on the capability of people to better recognize the brands and, hence, create that equity, which is so critical at the premium that you get by going into Accor hotel, and hence, the value that you deliver to the asset owner. That's how we've been modeling, in fact, the effect of what we see as being an investment. If you try to put it in numbers with time, this time, we wanted to be absolutely clear on what our modeling is so that we provide you, in fact, the best understanding of why we do it and how it is going to ramp up. The critical point here is what I started with, i.e., this is EUR 60 million that will be in 2022 coming on top of the EUR 1.2 billion target. If you can look at it as something that we invest into in order to be at a number which is better at the rendezvous that we've got with you in 2022, and even better the years after, because the exit run rate of EBITDA creation is EUR 75 million. There will be a gradual ramp up. As usual, the first two years are the years where you put in place your program, and so you've got costs and the revenue ramp ups takes, as in every project, a little bit of time. If you are to do a simple math, you say that you created an investment that generates EUR 75 million of EBITDA. You take a multiple, which is the multiple of our industry, and you find that 75 times 12 divided by 225 provides you a 4x return on the investment. A point also that we wanted to be crisp on is that we would provide you, in fact, on this one, a separate visibility, i.e., we will give you what we do and how we progress towards the number that I'm depicting today. In order to really give you the visibility of what we are launching and how it is delivering, that would be something that we would name non-recurring. Just for the sake of assessing what is our performance and assessing what is the dividend, because we define the dividend policy, and we stick to the dividend policy on the basis which is the numbers excluding, in fact, this MIP program. Obviously this is not accounting, this is management information, but we will provide you that visibility. Again, I hope that at this stage of the discussion, you are all fully convinced, like I am, that this is the right thing because this company in the future is about brands, it's about marketing, it's about names, it's about what people feel, it's about experience. This is a much different world than managing hard asset like we've been doing for many years. So that's on the numbers. Two very simplistic slides, and I'll turn to my boss. Okay, we have one last slide and then the floor is going to be yours on questioning what we told you and critiquing in good and bad ways. That slide is the one you might remember. You do not have it on your deck because I was asking people to put back my last slide of the Capital Market Day. Because nothing has changed. Because what I told you 2 and a half months ago is still entirely valid. Because we do not change our mind within 2 and a half months. So what you see here is a repeat of November, which I think went well with many of you to say that we have to focus on brands. This is exactly what we have announced this morning. We have to focus on geography. This is what Steven has told you on the 9 main countries, which matter the most, representing 75% of the fee stream. Pipeline, we did not talk much about it. I think we did at length with Gohar and his team in November, and we are going bigger and bigger, stronger and stronger, and indeed, it is only going to be a matter of months where Accor will be opening one hotel per day. Today is one hotel every 30 hours. Partners, Ian just talked to you about it with AEG, IMG, and obviously Paris Saint-Germain and Sony and Spotify Technology. We are combining everything under one common appellation called ALL. Make it easier, seamless. The teams, I started and I am finishing with them. So for those of you who feel that again, Accor has changed course. Accor has changed their mind. Accor is not doing what we said. You cannot, because what I said 12 months ago, it is exactly what we demonstrated this morning. Voilà. Who wants to be bold? Who wants to be the first one? Oh, I am not surprised it is you. Sébastien, I am going to need backup with me, huh? Monsieur Valenta. Please come back. You know what? What I will do, if you do not mind, Jean-Jacques, Maud, Steven, Ian, if you can come back on stage, because question is going to be probably for many of us, and I want to make sure that we can actually answer. Take my seat here. It is always not my seat. Take a seat. Yes, pardon. Yes. Hello. Good morning, Richard Huff from Bernstein. 3 questions, if I may, as is normal. Obviously, you say nothing has changed since the CMD, but there is another EUR 225 million of investment you are putting in. Jean-Jacques, you pointed out that results were very good this year. So just wondering, what weakness are you trying to really address with that? Historically, you have said that the lower loyalty contribution is more that Accor is a leisure-focused brand, leisure where you want to grow. So are you trying to make the loyalty program relevant to leisure customers, or are you going back to more of a business focus? Secondly, on the brand investments, clearly you are focusing on its core brands. If I think about the other 22 brands you have got, you make about, if I take the 88% off, you make about EUR 5 million per brand in fee revenue. Can those brands be profitable at 5 million per brand, and is there need for any reconciliation? The last one may be slightly cheeky, but press reports said that Emirates pulled out of the PSG shirt sponsorship because they were asking for EUR 80 million per year. Is that ballpark what you are paying for the shirt sponsorship? Thanks. You want to start with leisure versus B2B guest on. I will certainly. Do not know if this is on anymore. Yeah, it was on. If you think about the brand, the second question you asked, I think our brands are absolutely sustainable. We have over 30 brands. I think our consumers are looking for choice. It is a critical part of a large hospitality multinational to be able to deliver a wide range of brands for our owners and potential owners, to drive pipeline growth as well as to appeal to a range of consumers. I think to that point, though, it is very important to have an overarching and very strong and engaging loyalty program to then sustain all of those individual brands, because you cannot obviously afford to invest in 33 brands to the level that you perhaps would want. You can sustain that many brands, but you need to have a very strong loyalty program to sustain them and to nourish them and to drive cross-sell. That's why, of course, we've just launched ALL. I would probably also add to that the brand piece is absolutely complemented by the incremental frequency that we will drive through partnerships. We actually demonstrated the On The Move every day, everywhere piece. We are working on actually driving frequency at a state that is non-leisure, at home. These transactions, which historically would've only been in leisure destinations, now have a capacity to extend in your local area, which actually really extends our brand and our loyalty program beyond what it was originally designed to do. I guess, Richard, because maybe it was confusing. What he showed to you, Steven, on the nine geographies and the several brands is the additional investment to be made on those specific brands over the next two years calendar. We still have the 150, couple hundred million marketing spent every year going across the 33 brands, which is enough for those brands to be visible. Mantra, for example, is super well-known, super powerful in Australia and New Zealand. You don't really need Mantra to be known in Warsaw and in São Paulo. Same thing for SBE. Then I know SLS Mondrian are very well backed and supported by SBE marketing social network budgets, so we don't have to overspend on them. Just a matter of rigorous and basically going after those where we feel we can increase notoriety, awareness in countries which matters the most. For the last question, you should come tomorrow afternoon, 6:00 P.M., in the Parc des Princes. You will be disappointed, so don't come because we will not disclose the number tomorrow at 6:00 P.M. We, Accor, never disclosed any numbers that we sign off with different partners. Partners do not disclose either what they sign off with a big corporate. The only thing I can say is we paid the price we felt was the right price for us to give the return we gave you here. The one number is for you to probably have in mind, which was in the CP today, is what we are getting into, and the dimension of what it is far bigger than common thoughts. Paris Saint-Germain as a club, Paris Saint-Germain players are today followed in the world by 395 million fans. Think of what we can do in terms of reach for those fans, many of them probably never being accustomed to Accor. Seeing what we can do, and we provide different gifts. They print 1 million jersey a year, where you are going to have our logo, our name on it. We can also probably print hundreds of thousands of jersey to the benefit of premium customers when they can get to their hotel room and have their name in a jersey, bring it back home. You do not bring a book back. You do not bring a bottle of wine back. Would you bring a jersey back, even if it is not your team? You are never going to throw it away. You are going to keep it, you are going to be coming back with it, and you are going to be sharing it. That is what it is. Okay. Bonjour, Mathilde Visseyrias, Le Figaro. In English, I guess. You spent a lot of money in acquisitions those last months. Invested is better than spent. Yeah. Invested. What is the budget you may have for the coming year or years in new acquisitions, and do you have any new targets in mind? Other question regarding the OTAs. Can you give me the amount of, well, the part of OTAs in your global distribution now? Last question, regarding the loyalty program, I understand the revolution with PSG and new things arriving. But in the past, your competitors insisted on giving free nights for customers, and they appreciate that. Are you less generous in that point? Is it still important, free nights? Thank you. Okay. On the first one, I will be quick, as I was on November, whatever that date was, for the CMD. We are not working on any M&A project. We are not engaging with any investment banker on any M&A project. I told you, and I stay firm, the years of 2019, and I did say at least until end of the summer, is where we basically fulfill promises. We finish what was started. We have invested EUR 2 billion last year. We are launching this new program. I am myself focusing 99.9% of my time on what matters the most to this company, team, brands, loyalty, and obviously, guests. On loyalty? To answer the loyalty question, I think we mentioned in the presentation that there were multiple aspects. There is, of course, a more transactional aspect to loyalty, which has to do with free nights. I would say we are quite comfortable with the dividend our program provides our members and the liquidity that is actually connected to that dividend. So the capacity for our members to earn and burn at a rapid pace, combined with the type of redemptions that are available, I would say we are confident with our current proposition. The second piece I would say is that you cannot only look at the transactional component. There is a structural component, of course, such as status, which we have addressed today partly, but we will be addressing more thoroughly in the coming months, which will obviously create additional incentives for customers to consolidate. Of course, the relational and emotional pieces are components that are also key, particularly as we start moving into this experiential space, which will obviously be materially important as it pertains to long-term engagement. Maud, on OTAs? I am not going to disclose the number of the OTAs, but I can tell you that we resist pretty well now with a double-digit growth on our direct web performance channels. This is a purpose. If I may create a link with your loyalty question with generosity, it is a kind of virtuous circle, i.e., the more relevant the offer I am going to create within the new loyalty promise are going to be, the more powerful we are going to be in order to leverage the direct performance of our channels. So yes, there is for sure going to be a lot of generosity. We are going to go back to some key offers, key expectations of the guests towards loyalty, and we cannot say more, but we are going to be saying more very soon. Back to making loyalty more liquid, more tangible. And for sure, we expect those new benefits, those enriched benefits, which are fully part of the new guest promise of ALL, to directly promote our direct web performance. This is really the circle we want to create. Merci. Oui, madame. Je ne sais pas qui. Le micro va arriver. It's coming. We do madam first, and then it's going to be back to you. Good morning. Sabrina Blanc, Société Générale. I come back once again on the dividend distribution policy. I understood that the EUR 225 million are out of the non-recurring cash, but doing the maths, taking into account the potential EBITDA growth and the envelope in terms of CapEx, I would like to understand what could be the dividend policy and if the EUR 1.05 is a sort of commitment for the group. I think it works. Thank you. In term of dividend policy, nothing changes. What we've said is what we will stick to, i.e., there is a dividend, an ordinary dividend, which is going to be computed on the basis of 50% of the recurring free cash flow. So not to disturb what is called recurring free cash flow, we will exclude that one-off investment, which is the EUR 225 million related, in fact, to the program. If you do the math, and if you take what we show that the Capital Market Day, i.e., a growth on the free cash flow, on the recurring free cash flow, which is greater than 10%, you very rapidly arrive in numbers which are above EUR 1.05. So I think the answer is that you will reach the EUR 1.05 if we go and execute like what we said, very shortly, very rapidly. That is also part of the element in the discussion of why we moved to EUR 1.05, because in essence, this year was something a little bit exceptional because we are in the midst of being in two models and not fully ramped up. The M&A, for example, the EUR 2 billion only incurred in 2018 and will show profit in the coming years. The EUR 1.05, just to add up to this since we were both at the board yesterday. The numbers as per the calculation was EUR 0.94, which anybody can do. 50% of basically the recurring free cash flow. We then talked at the board and said, "I guess we have done Booster, we have done a lot of things, and it is going to end up being lower than last year." With the board's assessment, and again, discussions unanimous, we decided to show strength, confidence in the future, and not to go to the EUR 0.94, but to basically pay what was paid last year, which is kind of actually probably double digit compared to what we could have done. You are going to see probably in many years, some exceptions to the rule, but the minimum will be that 50% of free cash flow, of recurring free cash flow. Monsieur. Good morning. Julien Richer from Kepler Cheuvreux. Two questions for me, please. The first one, looking to your EUR 225 million plan, if you benchmark that to what your peers are spending, how did that compare and how confident are you that it will be only non-recurring, for the next two years and that is it. Second question, basic one on RevPAR momentum for 2019. I am curious to have your view, please. I leave Jean-Jacques on the second one. Julien, I will say it lightly. I think you guys have the numbers in mind, and I will give you the ballpark. Marriott, sales marketing loyalty are spending $4 billion per year. Hilton is spending over $2.2 billion a year. IHG is spending $1.5 billion a year. We are spending $700 million a year. We have to catch up. We have to wake up. We have to put a big push. A lot of good reasons. Network segmentations, they have, as you know, over $2,000 fee per room. We have $1,200 fee per room. We said to you in the CMD, we are going to go surely, gradually from the 1,200 room to 1,700 room because of Raffles, because of all the Swissôtel. We know we are going to be in 2022. But we are still going to be far behind what they spend. Is EUR 225 million enough? Answer is probably no. Are we going to be spending more because it is not enough? Answer is also no. But since we are adamantly a people servicer, an operator and franchisor, that was the right time to make that push in addition to what we do on a yearly basis. That push, if we say it is going to be exceptional, I am not going to come back here and tell you we are going to make another push in 2 years. But I want you to know, which I have been telling everybody in a very clear fashion, Accor has cash on the balance sheet yielding 20 basis point. Accor let go EUR 4.8 billion of equity, having sold 65% of Booster, which yielded 10% to 12% per annum. Accor's mission and management duties are to reemploy wisely that amount of money into a double-digit growth prospect, otherwise we are destroying value on behalf of shareholders. Accor is investing share buyback because I believe it is a 12% IRR buying at $40 stock. Accor is investing EUR 225 million in those marketing initiatives because I believe deeply it is well in excess of the 12% return that I need for not destroying money. So we are doing something which is very rational, being studied, right geography, right brands, right partners, and probably right time. Just on your question on RevPAR. What I would say first is that, we are in 100 countries. Because of that, we are immune, to some extent, to many of the changes that are happening in the world, because when something goes right in one place, something may go wrong the other place, and so there is a natural balancing happening here. But to be a little bit more specific, you know as I know that this is, the RevPAR is very much linked to the GDP and the economy of the world. Today, the uncertainty points that we have got on the RevPAR is how are all the discussion on world trade going, and what direction are they taking? That is a key point. The China, U.S.A., and all the ramification of it, is a key point of what may happen in our industry. If you look at the publication of the number one Chinese hotel corporation, their RevPAR in Q4 was negative. As I have been saying into our presentation, we do not see it today, and we have great result. But I would be careful at how this, I would say trade war is evolving because it has replication not only in China, but also on the rest of the Asia Pacific environment. After that, there are good news, just like the turning around of Brazil, which is the key element of our South American performance. 80% of what we do there is Brazil, and you have seen that gradually we have been able to show double-digit RevPAR in Q2 and in Q4, Q2, Q3, Q4. In fact, this is not due to change based on what the projections are. The other element that I would highlight, which is difficult again to master, is Europe. In Europe, there is this Brexit uncertainty. As I've been saying, Brexit for us is being, up to today, a blessing. Results are being great in the U.K. But the question there is, where is the U.K. going to go? How is the currency going to evolve? There is a lot of elements here, which then fragilize the rest of the Europe economy. Germany is at a GDP forecast of 1.5%, so all of that is not necessarily very good in the long run for our consumption. I would be, in summary, on the RevPAR assumption, saying that there are some positive, just like Latin America. There are some question mark, just like what's happening in China and in Asia Pacific. Clearly, Europe need to find its path towards more stability so that we know how things are going to be developing. Which today, we don't really have that visibility. That's the element. Summary of it is that despite all of that, you've seen that we've been able to weather a lot of tempests, and so we are very well-positioned because of the balancing of our 100 countries. To add a bit of joy, we're not changing the 3% RevPAR that we expect for this year. In average or as a compound? Okay. You guys want to go and have a coffee then? Sébastien Valentin, Coming from one of the financial analyst webcast. Exactly. Good morning. We've got questions from Jamie Rollo at Morgan Stanley. One question is, how will you encourage greater loyalty to get to the 10 points increase in contribution? Will you discount rate more to loyalty members? The goal today is, of course, to build a proper value proposition. The goal of loyalty is not to go into deeper discounting. Hopefully, what you've seen today is not a commitment to deeper discounts, but rather to build a much more compelling value proposition across the board. We today already have member rates, which exist within our program, are deployed on a normal way. This will continue. Of course, those member rates will be complemented by incremental incentives that will be structural in nature and much more experiential benefits that will drive a certain degree of retention. Additionally, I would also say that there is also a natural growth on contribution that we related to the frequency and multiplication of touch points that will be available through additional partners. To say that loyalty will only grow through a deeper discounting is actually flawed. As a matter of fact, Sébastien mentioned it, loyalty, distribution, digital brands must work all together to drive that specific growth in contribution. The goal is not to dilute, of course, the member rates or where members are paying today. Yeah. Just add something. You may have some discount loyalty program. We are not. We are going to ensure best price guarantee, best experience guarantee. We are going to ensure our clients benefit the best rate, and we for sure are going to keep the member rate Ian just mentioned. Our all ambition around this new guest promise is far more. It's really about generating much more revenue and then increasing the loyalty program contribution through a new value proposition, i.e., multiplying touch points through the three circles, like every day on the move, everywhere. Because we are going to multiply those touch points, then we are going to generate more and more revenue flows and then create more value. It's another philosophy of loyalty, and this is definitely the one which sticks to all. I think what I want to add for Jamie, because his question is right on. He has to accept, I have to accept, you have to accept and understand that what has worked 25 years ago, in that relationship, which was earn, burn, miles, point driven, those days have shifted enormously over the last 25 years. What people want today, and it was said, it's not really credit. They want recognition, they want to be identified, they want emotion, they want passion. So much tougher to do, which is why I'm going back to talent, which is why I'm actually saying in front of those gentlemen, and I said it again in November. In what? What they coming here, gentlemen, pardon Maud, is they are new to the game here at Accor. Both Ian and Steven are less than 12 months at Accor. They coming here with their own recipes from different industries where they have a proven track record, whether it was Shangri-La, whether it was Air Canada, whether it was Qatar Airways. It worked with them, with their recipe in some other industry, some other continent. I guarantee you, it's going to work today. Just think, compute differently and be a bit audacious, transparent and accountable. It'll fly. Couple more questions here from Jamie Rollo. Yeah. Nothing from Vicky? Jamie is very curious. Will you include the EUR 55 million, all costs in underlying EBITDA or as an exceptional? If you exclude it, will you also exclude the future profit? No. It will be in the EBITDA. It will be in the EBITDA. It will be in the reported number. We'll provide shadow reporting, if you will, so that you can insulate it. Okay, last one on Orbis. Yes. Can you execute the disposal program without full control? What is your estimate of the Orbis realistic value? Yes. We have reached now an ownership level in Orbis following what we launched in January of close to 86%. Under the Polish law, you need to be at a threshold, which is 75%, in order to go and execute what we want to do, the separation of the hotel asset and the hotel service businesses. We are exactly where we wanted to be. Then there was another question on Orbis? No. Okay. Should the processes undergoing- Yeah, listen. AccorInvest will have a first look and the right of first offer as it is contractually being set up. It is going to take probably the year to go through to find a deal with AccorInvest, if we could, or to find a deal with somebody else. But real estate should be disposed of by year-end. It seems Vicky has listened to you, so she has two questions. Vicky, I provoked her, I guess. 225 million investment. Can you break it down between three buckets? Also, is the CapEx element reflected already in CapEx guidance? What would be the phasing for that? Are we going to split the 225? Answer is no. Because if I give too much granularities, then people's going to be able to know what is a different partner's relationship, and I just don't want to do it. Marketing is something, I guess, we're spending, and I'm not going to be giving granularity in how much we spend on that brand, in which continent, for what kind of support, whether it's social media, bloggers, influencers, blackboard, ad. No. I think we're giving enormous amount of information to just make sure we are accountable for what we do. But no, thank you. We manage this company well, and we just don't have to give all the numbers to everyone. With due respect to Vicky. Absolutely. There is no CapEx element. The other element of answer is there is no CapEx element. It's all operating P&L. Okay, last question. On IFRS 16- Yes. Can you elaborate on the impact on net income? The net income impact. In fact, what I said earlier is that the impact on debt is about EUR 1 billion. The impact on EBITDA is to the tune of EUR 100 million this year, going up a little bit next year as we will have Mövenpick as a full year. The impact of the net income is, so to speak, zero. Very close to zero, because what you do is you reallocate your lease expense into interest and depreciation. So at net income level, it is close to zero. Is that bon, Monsieur Valentin? Okay. Unless there is another question, I think you all want to go back. Merci beaucoup. There is coffee outside, and we are paying for it.

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