ATLANTA—InterContinental Hotels Group (IHG) in the first half of this year achieved an increase of 3.7% in global RevPAR. During the same timeframe, total gross revenue hit $13.3 billion, up 9%. Additionally, IHG also added Regent Hotels & Resorts and Voco Hotels to its portfolio.
“We’ve had a strong first half, delivering our best signings performance for a decade,” said Keith Barr, CEO at IHG. “RevPAR grew at 3.7%, which together with 4.1% net system size growth, drove underlying operating profit up 8% and underlying EPS up 25%. This underpins our decision to raise the interim dividend by 10%.”
U.S. RevPAR was up 2.7% in the first half, with 2.9% growth in the second quarter driven by corporate and group bookings and, as expected, some benefit from the earlier timing of Easter. Canada was up 7.5% in the first half with continued strength in urban markets, while Mexico was down 0.2% impacted by strong prior year comparables.
Continental Europe RevPAR was up 5.9% in the first half, with continued recovery in terror impacted markets. Germany was down 1% due to a weak trade fair calendar, and the U.K. was down 0.2% (London down 1.4%, provinces up 0.6%) impacted by strong prior year comparables. Elsewhere, the Middle East was down 7% due to high supply growth, while Japan and Australia were both up 3.5%.
Comparable RevPAR increased 10.1% (Q2: up 9.3%), significantly outperforming the market. In mainland China RevPAR was up 9.1% for the half, with tier 1 cities up 10% and tier 2-4 cities up 8.4%, driven by continued strength in corporate and meeting demand. RevPAR in Hong Kong SAR and Macau SAR was up 13.1% and 19.5%, respectively.
With regard to signings, the following are a couple of highlights:
- In the Americas region, IHG opened 91 hotels (9,000 rooms), with more than two-thirds driven by the Holiday Inn brand family.
- IHG also signed 195 hotels (20,000 rooms) in the Americas; the momentum behind Avid Hotels brand continues ahead of expectations, with 130 signings since launch across U.S., Canada & Mexico; 82 signings in the half. (The first Avid property in Oklahoma City is due to open in Q3).
“The fundamentals for our industry are strong, we are confident in the outlook for the balance of the year and in our ability to deliver industry leading net rooms growth over the medium term,” he said.