Press Release: Club Mediterranee
Announcement of Transformation Plan for 2001-2002
January 11, 2001
PARIS -- Club Mediterranee has announced operating profit of 103 million Euros for the financial year ended on
31st October 2000 and Group net profit of 59 million Euros, an increase of 51% compared to the previous year.
These results have been achieved thanks to work undertaken over the past three years: today, the recovery of Club
Mediterranee has been accomplished.
Having laid the foundations for its redeployment, the Group is now embarking upon a new phase, setting up a transformation
plan which will enable it to become a global leader in all aspects of leisure.
2000 Results
Consolidated revenues rose to 1,889 million Euros against 1,477 million Euros, an increase of 27.9%. On the basis
of like-for-like accounting and constant exchange rates, the increase was 11.2%. This strong revenue growth confirms
the dynamism of Club Mediterranee in the context of a mixed environment in the tourism sector.
Villages: revenues by issuing region for the Europe / Africa zone increased significantly by 13.3% to reach 1,021
million Euros, representing 68% of consolidated revenues on a like-for-like basis for this area of activity.
Revenues for North America -- 248 million Euros -- increased by 2%, reflecting the first signs of recovery in this
zone.
At 232 million Euros, revenues for the Asia zone have increased considerably, by +17.5%.
Tour Operating: revenues for Jet Tours amounted to 281 million Euros over 12 months. Revenues were up 7.9% over
the whole financial year, the rise stemming predominantly from the first half up +11.7%, with activities for the
second half rising by + 4.6%.
New activities: the commercial success of Club Med World is reflected by revenues of 4 million Euros from July
to October, increasing on a weekly basis throughout the period.
Occupancy rate: this was 73.7% against 69.6% in 1999.
Operating income, at 103 million Euros, has increased by 45%. Following a change in reporting presentations, this
result includes approximately 8 million Euros of credit card commission costs, which were accounted for as operating
costs and will be included in the financial result from now on.
This amount represents the highest operating profit in the history of Club Mediterranee.
Other elements of the statement of income are as follows:
The financial result was (13) million Euros against (17) million Euros the previous year.
Net income from equity companies stands at 2 million Euros against (2) million Euros last year.
There was an exceptional result of (14) million Euros against (2) million Euros the previous year.
Goodwill amortisation amounted to (8) million Euros against (6) million Euros in 1999. Group net income was 59
million Euros against 39 million Euros in 1999, representing an increase of 51%.
A dividend payment will be submitted for approval to the company's Annual General Meeting, which will be called,
March 13th, to review the figures for financial year 2000. The Group intends to double the dividend paid last year
(0.5 Euro per share), thereby increasing the amount to 1 Euro (1.5 Euro including tax credit).
The strategy which will rapidly make Club Mediterranee into one of the global leaders in leisure
Having reformed its activities, Club Mediterranee is embarking upon a new phase and setting up its transformation
plan in order to ensure continued growth.
During the past three years, the company has staged a financial recovery and has developed its activities significantly.
Above all, this period has shown that the Club Med model is effective and will have a considerable influence on
the future of the company.
The brand redeployment policy, first implemented 18 months ago, has been crystallised by the successful launch
of a new leisure concept, Club Med World, the broadening of the Club Med product range (active wear, body care
and sun creams, sunglasses, watches, water sports, etc.) and by the launch of Club Med.com which already accounts
for 2% of Group revenues in France and 5% in the US.
With its transformation plan, Club Mediterranee intends to radicalise its activities and to achieve strong growth
in all aspects of leisure, relaxation and holidays, using the three strategic assets which are its employees (the
GO), its members (the GM) and its brand (a Club).
In so doing, the company is achieving the target which it set in 1998: to progress from being a hotel company to
a service company based on the concept of a club and on the strong sense of belonging which its members enjoy,
enabling it to embody a lifestyle.
The transformation plan will also enable Club Mediterranee:
-- To pursue improved profitability in its villages by radicalising the
initiatives undertaken in the past 3 years,
-- To intensify the redeployment of its brand and to broaden the scope of
activities complying with the Club Med strategy (such as fitness/
well-being or music). This will be achieved through internal growth
and focused acquisitions, facilitating the company's rapid progress
towards becoming a global player in the leisure and relaxation arenas.
Club Mediterranee is not seeking to become a mass-market tour operator, even though this area of activity forms
an important part of its transformation plan, enabling the company to improve its competitiveness, particularly
in transport and incoming activities.
In this area, Club Mediterranee will have a solid base provided by the significantly reorganised Jet Tours and
will pursue a policy of forming alliances in strategic markets, as it had already done in France (Havas Voyages)
and in Germany (Rewe) during financial year 2000.
This plan is articulated around four main axes:
-- To rethink our structures and areas of activity;
-- To accelerate development (villages and other activities);
-- To invent and innovate;
-- To deploy and intensify new activities to improve our productivity.
The transformation plan announced today gives Club Mediterranee the capacity to improve its core activities
and also to intensify its development around strong and innovative concepts and to create sources of profitable
growth for the future.
Commenting on these results and the announcement of the strategy of Club Mediterranee, Philippe Bourguignon, Chairman
and CEO, said:
``Following the recovery of Club Mediterranee and the re-establishment of its economic base, we are now focusing
on the far-reaching transformation of its activities, with the aim of becoming a club which is active in all aspects
of leisure, relaxation and holidays, enabling it to develop rapidly and to create profitable leverages of growth.
In so doing, we are achieving our greatest ambition: to provide Club Mediterranee with a great future based on
the values which have always been at the roots of our success.``
Key figures
2000 1999
Number of clients 2 020 500 1 768 000
Of which G.M. 1 710 500 1 570 000
Hotel days sold 11 730 000 10 700 000
In millions of euros
Year 2000 1999
Consolidated revenues 1 889 1 477
Operating income 103 71
Net financial result (13) (17)
Net income from equity company 2 (2)
Exceptional expense (14) (2)
Income tax (10) (5)
Amortization of goodwill (8) (6)
Minority interests (1) (0)
Group net income 59 39
Cash flow 116 113
Capital expenditures 318 265
Net debt 423 392
Equity 884 551
SOURCE: Club Mediterranee