InterContinental profits slide as USA consumers reign in spending

12 August 2008 by
InterContinental profits slide as USA consumers reign in spending

Holiday Inn owner InterContinental Hotels Group (IHG) has seen its first-half pre tax profits fall 9.7% to $232m (£122m) as the US downturn hits.

Although the company's global revenue per available room (revpar) was 4% higher than a year ago, revpar growth in the USA was a more modest 1.6%.

Despite this IHG's total turnover for the half year increased 14.4% to $952m (£500m), as a booming market in the Middle East, Europe and Africa region offset slowing spend in the USA.

IHG also benefited from speedy expansion, which has seen it add 60,000 new rooms since June 2005, ahead of its three-year goal.

Chief executive Andrew Cosslett said: "IHG had a good first half, seeing growth in both revpar and in the number of hotels we operate round the world. Growth looks set to continue as we have been signing two hotels a day into our development pipeline.

Generally revpar growth slowed through the second quarter and market conditions have become more challenging particularly in the USA. However the long term trends for the travel industry remain positive and our broad portfolio of brands and fee-based business models positions us well to take full advantage of this."

InterContinetal Hotels to keep new global HQ in UK >>

London Crowne Plaza hotel bought for £85m >>

IHG reveals design plans for first green hotel >>

Tough second half of the year ahead for hoteliers >>

By Gemma Sharkey

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TagsFinance and Hotels
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