Underlying operating profit rises to $301 million
The world’s biggest hotelier has posted a 6% increase in profits for the first half of 2014. Underlying operating profit rose to $301 million (€225 million), slightly below an average forecast of $305 million.
Around 200 new properties joined InterContinental Hotels Group during the period, raising the total to approximately 4,700 hotels. The company said it was encouraged by trading trends but added that there were political or economic problems in certain markets.
IHG, a British-based multinational that operates brands such as InterContinental, Holiday Inn and Crowne Plaza, saw underlying revenue rise 4% to $788 million, with global revenue per available room (RevPAR), up 5.8%. This was kept high by improving business and leisure travel in the United States where the group makes almost two-thirds of its operating profit.
Interviewed by the BBC this morning, IHG CEO Richard Solomons commented that “things are going quite well” and stressed that two new brands had launched in the last two years – Hualuxe Hotels & Resorts in China and Even Hotels in the USA.
But he rejected rumours of a 6 billion pound (€7.54 billion) takeover offer by an unnamed suitor in the US, and he also denied rejecting such an offer.
Yesterday it was reported that Marcato Capital Management, which owns a 4% stake in IHG, had hired an investment bank to advise it on strategy to “significantly enhance IHG shareholder value”.
BBC / Reuters
[image courtesy IHG]