Aug 6, 2019

InterContinental Hotels hit by stagnating US growth

InterContinental Hotels, the owner of Holiday Inn and Kimpton Hotels, said that growth had stagnated in the US, its biggest market, driven by tough comparables from hurricane-related demand for hotel rooms last year. Revenues for the six months to the end of June increased 7.9 per cent to $2.3bn. Profit before tax increased almost 25 per cent from $301m to $375m. The company said it had a stronger half in Europe, where revenue per available room - revpar, the industry's favoured performance metric - increased 3 per cent, boosted by trade fairs in Germany and Cricket World cup fans in the UK. Industry watchers have long voiced concern that the US market is slowing down. "In a slower revpar growth environment, we've made significant progress, opening a record number of rooms in the first half which have delivered a 5.7% increase in net system size growth, our best performance in over a decade, with future growth underpinned by our highest level of signings over the same period." The group proposed a 10 per cent increase in its interim dividend to 39.9 cents per share.

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