America Top Line Growth of +5.2% - Ski sales growth of +34% in North America
“Club Med North America is pleased to announce yet another great year in 2013, with a new record in profit driven by a significant 5.2% growth of our topline at constant capacity in the region and new achievements in sales towards our ski resorts in Europe and the MICE market. Our sales increased across all channels, both direct and indirect, as well as groups and individuals, within all our targets including families, couples and single travelers. Our new guest recruitment and brand loyalty have also risen, which is a great indicator of sustainable growth for our upscale all-inclusive business model. Trends for winter 2014 are on track to continue yielding success with strong early bookings, high occupancy levels for the holiday season and very strong Black Friday/Cyber Monday sales results.
“This performance is also a result of our latest innovations, most notably in the active wellness sector, with our all-inclusive Sandpiper Bay resort in Florida boasting professional Academies in Tennis, Golf, Fitness and now Volleyball, as well as kite-surfing and expanding golf programs in Punta Cana, Dominican Republic. Club Med will also see business growth this summer from the extension and renovation of our highly successful property in Cancun.”
Commenting at the annual results, Henri Giscard d’Estaing, Chairman and Chief Executive Officer of Club Méditerranée, noted that:
"In 2013, the deterioration of European tourist markets continued and intensified over the summer, particularly in France, under the impact of a double crisis that affected outbound countries and Egypt and Tunisia destinations.
"In this context, Club Med recorded stable activity and was able to sustain its operating profitability, thanks to the strength of its new business model and its presence in the fast developing markets.
"This is why the Group, while strengthening its position in mature countries, must accelerate its internationalization with a more upscale offer based on opening new villages combined with numerous innovations."
1. Stable business in a mixed environment. Operating profitability:
Key data for fiscal 2013 (November 1, 2012 – October 31, 2013)
-- Stable business:
-- In France, the Group continued to win market shares in declining markets, particularly during last summer. With a market down 9.5% in summer 13 (SETO1 data at the end of October), the business volume of Club Med on the Individual segment was stable, confirming the strength of its unique positioning.
-- The number of 4 and 5 Trident customers continued to grow with 29,000 additional customers, an increase of 3.3%. They now represent nearly 73% of customers, versus 68.3% in 2012, an increase of +4.4 points.
New satisfaction records were also hit this year.
-- Village portofolio continued to move upscale. In 2013. The 4&5 Trident villages represented 71% of total capacity at October 31, 2013, a 5.1-point increase over one year.
In 2013, the Group successfully opened three new villages: Pragelato Vialattea in Italy, Belek in Turkey, and Guilin in China. These three 4 Trident villages, which are permanent or bi-seasonal, with optimum capacity, are operated under a leasing or management structure.
3. Winter 2014 outlook
-- Bookings as at Novembre 30 2013
1 Syndicat des Entreprises du Tour Operating (SETO)
Winter 2014 bookings at November 30, 2013 (business volume at constant exchange rates), were up 5.4% over Winter 2013, with capacity growth of 2.4%, due to Guilin opening in China. At the same time last year, slightly more than two thirds of the winter bookings had been recorded. These bookings were up in all geographic regions.
Bookings in Europe-Africa region were up 4.7%. In France, supported by a proactive early booking policy, bookings were up slightly by 1%, in a market (individuals) still down 6% at the end of October (SETO figures).
Excluding France, there was a positive momentum driven by certain markets like Israel, Switzerland and South Africa.
The 7.2% increase in the Americas and Asia was based primarily on the dynamic activity in the United States and the sales recovery recorded in Japan and Australia.
4. Accelerate internationalization
-- Take advantage of Club Med's global positioning to win new customers in fast developing markets2.
With a 4-point growth since 2011, the 354,000 customers coming from these markets now represent 29% of Club Med’s worldwide customer base.
The Group has the objective of having one third of its customers coming from these markets at the end of 2015, particularly in three target countries:
-- Develop an upscale offer to accelerate the internationalization of its customer base.
To meet its objectives, Club Med continues to expand with seven projects of new 4&5 Trident villages over three years: Val Thorens, a ski resort in North America, Buzios in Brazil, Oman, and three villages in China.
-- A competitive advantage - the mountain destination: "Club Med: the world leader in ski vacations."
Club Med operates 21 ski resorts in the most prestigious ski areas. The unique and practical nature of its all-inclusive ski packages for families are key factors for attracting international customers, who represented 53% of total customers in 2013.
Club Med continues to strengthen its world leadership in all-inclusive ski vacations with the planned opening of the new 4-Trident Val Thorens village in December 2014, which will create 250 jobs, in a ski area that has just been ranked the "Best ski area in the world" by the World Travel Awards 2013.
5. Public Tender Offer
As a reminder, on May 27, 2013, AXA Private Equity and Fosun, the two main shareholders of Club Méditerranée, announced in a press statement their intention to file together with the Club Méditerranée management a voluntary public tender offer for the Company's securities through a Holding company, Gaillon Invest. This proposed offer was filed with the French Autorité des Marchés Financiers on May 30, 2013, at a unit price recorded on June 24, 2013 as €17.50 per share, and €19.79 per bond with option for conversion and/or exchange for new or existing shares ("OCEANE") (coupon attached) (the "Public Tender Offer").
On June 24, 2013, the Board of Directors of Club Méditerranée unanimously approved the option of choice offered to shareholders by the Public Tender Offer and recommended to the shareholders who would like to benefit from liquidity to tender their securities in the offer.
On July 15, 2013, the Autorité des Marchés Financiers ("AMF") approved the Public Tender Offer from Gaillon Invest, targeting the shares and bonds with an option for conversion and/or exchange for new existing shares (OCEANEs) in Club Méditerranée. The Public Tender Offer opened on July 17, 2013.
Following the appeals filed with the Paris Court of Appeals on July 24 and 26, 2013 seeking cancellation of the AMF decision regarding the compliance of the tender offer, the AMF announced on August 6, 2013, the extension of the tender offer which was initially scheduled to close on August 30, 2013. In practice, the closing of the Public Tender Offer is postponed to at least eight days after the Court ruling on the motions for cancellation. The date for pleadings has been set for February 27, 2014 by the Paris Court of Appeals.
Given the payment of the coupon for €1 per OCEANE made on November 1, 2013, the price offered to OCEANE holders in the Public Tender Offer was adjusted and reduced accordingly; it is therefore €18.79.
The company underlines that official information relating to the Public Tender Offer is provided in the note en réponse referred to by the AMF, and in the Club Méditerannée press releases. In addition, the company states that the financial data contained in this release is consistent with the information provided as part of the ongoing public offering, specifically in the note en réponse (stamp no. 13-363 of 15 July 2013)".
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