The Pierre & Vacances-Center Parcs Group Presents Its New Strategic Plan Change Up1
29 Janvier 2020 - 07:00AM
Business Wire
A strict strategic plan for 2024 aimed at delivering
sustainable profitability, based on:
- Optimisation of current operations,
- Targeted and profitable development,
- An agile and entrepreneurial organisation,
- A current operating margin target for the tourism business
lines of 5% for 2022 and 9% for 2024
Regulatory News:
The Pierre & Vacances-Center Parcs Group (Paris:VAC)
announces today its new strategic plan for 2024, Change
Up.
Piloted by Yann Caillère, the Group's CEO since September 2019,
the objective of Change Up is to accelerate the Group's
transformation by improving operating performances.
This plan aims to boost organic growth in the Group's businesses
by optimising current operations, and to implement a selective
development process based on strict profitability criteria.
On the financial front, the targets of the Change Up plan
are:
- Average annual growth in accommodation revenue of 6% (4.7%
same-structure growth):
- +2.9% organic growth,
- +1.8% generated by renovations of existing Center Parcs
Domains,
- +2.6% from new site development,
- -1.3% from a reduction in stock
- Current operating margin from the tourism business lines of 5%
in 2022 and 9% in 2024.
These results, together with a €50 million cost savings plan,
are expected to generate cash flow of around €350 million over the
duration of the plan (2020-2024).
1. Optimising current operations
Review of the tourism asset portfolio
On 30 September 2019, the Groupe operated 2852 tourism sites in
Europe. The performances of these residences and resorts have
undergone an in-depth individual performance evaluation to
establish each site's ability to reach the target profitability
level (EBIT margin of 5% of revenue). This performance evaluation
of the asset portfolio will be monitored and repeated annually. As
such, residences showing insufficient profitability or stock levels
will be transferred to maeva.com under management contracts.
Development of the tourism offer: premiumisation and
enhancement of the customer experience
Change Up aims to accelerate modernisation and premiumisation of
the tourism assets, by extending the range of premium residences
and creating new accommodation concepts (Lifestyle by P&V for
Millennials), through renovation works and by increasing the number
of activities offered to customers.
The plan will also continue the Group's digital transformation
by placing Data and Artificial Intelligence at the heart of the
innovation model.
- Property development: optimising costs
Change Up will include the implementation of strict measures to
reduce the cost of development projects by :
- Redesigning upstream processes with a focus on acceptable rent
levels, - Strengthening the implication of the Procurement
department, - Reinforcing control measures and monitoring
throughout the construction phase, - Optimising management terms
with individual and institutional investors, - Streamlining
marketing costs.
Targeted and profitable development
- Pierre & Vacances mountain resorts: opening of new
residences in Méribel and in Avoriaz (December 2020) and many other
projects (Aime 2000, Avoriaz…).
- Pierre & Vacances in Spain: 3 and 4-star hotels in
addition to residences. By 2024, 1,800 additional apartments and
rooms are planned.
- Center Parcs, with focus on Northern Europe: development
projects for two new Domains in Germany for 2024 and 2025 as well
as management contracts in the Netherlands, Belgium and new regions
(target of two management contracts a year).
- maeva.com: growth in the campsite offer (150 affiliated
campsites by 2025).
Furthermore, development opportunities for the Group will be
studied on a case-by-case basis with the introduction of
asset-light models (management contracts, franchises) in addition
to lease contracts, and new financial partnerships.
An agile and entrepreneurial organisation
To accompany the Group's transformation and address the
strategic challenges, a new more agile, entrepreneurial and
empowering organisation is to be rolled out including:
- Seven autonomous business lines incorporating their own
main support functions (sales, finance, human resources, legal) so
as to control their entire value chain;
- A slimmed down holding company focused on governance,
oversight and strategic group-wide functions, in support of each of
the business lines;
- A unified property development division, organised
around development projects;
- Efficient and simplified operating methods between the holding
company and the business lines.
Aware of the potential impacts of the Change Up project for its
employees, and in view of the organisational changes planned mainly
at the head offices in France, the maximum number of layoffs
identified, as part of a Redundancy Plan, are about 220 positions
out of a total of 12,850 employees. The Group reiterates its strong
commitment to fully support employees through all these
changes.
The total amount of savings expected for 2024 stands at €50m
(€30m from reorganisation and €20m from procurement), 70% of which
to be delivered by the end of 2021.
*****
Gérard Brémond, the Group's Chairman, stated: "with its new
strategic plan, the Pierre & Vacances – Center Parcs Group
moves its transformation up a gear and creates the right conditions
for new sustainable and profitable growth. I support the
implementation of this plan, which reflects the values and purpose
of the Group and I will be at Yann Caillère's side in accompanying
its implementation".
Yann Caillère, the Group's CEO, stated: "the strict
implementation of the Change Up strategic plan, whose principles
are based on targeted and profitable growth for Pierre &
Vacances in mountain regions, for Center Parcs in Northern Europe
and improvement of our offer along with a “business-oriented”
organisation, should enable us to restore profitability as of
2021".
Change Up - The presentation document for the strategic
plan is available on the Pierre & Vacances-Center Parcs Group
website: www.groupepvcp.com
1 Change Up: moving up a gear 2 Excluding
multi-ownership, marketing and franchise activities
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version on businesswire.com: https://www.businesswire.com/news/home/20200128005684/en/
Investor Relations and Strategic Operations Emeline Lauté
+33 (0) 1 58 21 54 76 info.fin@groupepvcp.com
Press Relations Valérie Lauthier +33 (0) 1 58 21 54 61
valerie.lauthier@groupepvcp.com
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