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TWST: Virginie, would you mind starting us off with a definition of the universe that you’re following please: how is it characterised?

Ms. Lannevere: I specialise in lodgings, cruises, and football stocks.

TWST: Is that a pan-European coverage?

Ms. Lannevere: Yes, pan-European.

TWST: What are the basic descriptive statistics of those segments: how large are they?

Ms. Lannevere: Lodging is by far the largest one. In my view, it’s a EUR15 billion market in Europe. Cruises is made up of one company, which is P&O Princess (LSE:PO.L) in Europe, and it’s GBP2.6 billion right now. Football is very little at the moment — it’s not even GBP1 billion market cap.

TWST: What do you take to be the important measure of growth in the lodging sector, and what growth rate do you anticipate over the next 12 months?

Ms. Lannevere: I would say for lodging the key indicator is really what we call the revpar — revenue per available room; and my view is that we are seeing decelerating growth in revpar, and I am expecting for next year in the UK 3.5% revpar growth overall. In France, it’s a little bit higher because of lack of supply, so I am at 4.5% for France. And in the other territories in continental Europe I’m at 4% growth for the year.

TWST: What’s your analysis of the reasons for the decline in revpar over the next period? What are the principal causes?

Ms. Lannevere: I think it is really macroeconomic, because most of the lodging chains I follow, except for Club Med, are really heavily dependent upon business travel. If you think that 70% to 80% of the business of very large chains in the lodging segment are related to business travellers, this is one category which is very highly correlated for the GDP outlook from one year to the other. These people don’t pre-book in advance contrary to the holiday consumption pattern and they can really postpone visits or reduce costs. HSBC’s macroeconomic outlook is quite harsh for 2001. We are expecting 0% growth in US. For the European economy, even though it is insulated, we are still expecting GDP growth to decelerate strongly over the course of this year. In such a context, it is difficult to be optimistic for lodging: it would be the first time that a macro-economic downturn has not impacted the lodging statistics.

TWST: Any risks in the stock, in your view?

Ms. Lannevere: Yes; what would be fairly negative for the stock is, for example, if they could not announce a distribution alliance, because now they have laid down their plan, they have to give evidence that it’s really happening. So I think the risk is more in terms of the corporate newsflow. As for operations, I track on a monthly basis the growth of the package holiday market in France, and over the past three months there was no sign of decline; on the contrary it was still at +12%+13% month after month. So I just don’t think the summer season for Club Med is looking bad at all.