IHG reports flat hotels profit for third quarter

InterContinental Hotels Group (IHG) has reported flat operating profit of £76m for its hotels in its latest trading statement to 30 September.

In Europe, a strong performance by its London hotels was negated by its struggling Paris, Frankfurt and Cannes properties.

Overall, the group, which also owns the majority stake in soft drinks firm Britvic, reported a 4.3% year-on-year increase in pre-tax profit to £97m for its third quarter, towards the lower end of analysts' expectations. Group turnover slipped 1.1% to £563m.

IHG finance director Richard Solomons said October trading was strong and the outlook for the full trading year was positive. While growth in revenue per available room was still occupancy-led, the company has seen some growth in room rates, aided by increased business traffic.

IHG expects to raise £1.1b through a sell-off of 75 of its 81 UK hotels as it moves from owner to operator, with the sale of a further 32 properties worldwide expected to raise £800m. Solomons confirmed that IHG would sell some of the remaining 50 properties it owns at the right price.