Return of domestic holiday demand boosts InterContinental Hotels

A return of domestic holiday travel in the summer helped push InterContinental Hotels Group revenue closer to pre-pandemic levels.

The Holiday Inn and Crowne Plaza parent reported a “significant improvement” in trading in the three months to September

Group revenue per available room (revpar) was still down by 21% over the same period in 2019 by up 66% over last year.

The average daily rate achieved was in line with 2019 levels with occupancy levels of around 60%.

However, IHG reported a “broad spread” of performance within the Europe, Middle East, Asia and Australia region “reflecting the differing levels of market restrictions, particularly on international travel”.

Revpar was down 22% in the UK over the equivalent third quarter in 2019, 48% in continental Europe, 39% in the Middle East, 57% in Japan, and 68% in both South East Asia and Korea and Australia.

Occupancy across the region rose to 49% from 34% in the previous three months.

Chief executive Keith Barr said: “Trading continued to improve significantly in the third quarter.

“Revpar recovered closer towards pre-pandemic levels as more and more guests returned to our hotels around the world.

“Domestic leisure demand was particularly strong in a number of markets over the summer, where occupancy and rate climbed back to 2019 levels.

“Discretionary business travel, group bookings and international trips have also shown increasingly encouraging signs, on top of continuing good levels of essential business demand.”

He added: “We continue to grow rapidly, opening 79 hotels in the quarter and signing another 91 in to our pipeline of 1,800 properties, and we expect development activity to pick up further over the remainder of the year.

“Across our portfolio of 17 brands, owner interest is strong both for those brands recently launched or acquired, in addition to our well‑established and industry-leading brands.

“The rapid progress we are making with the review of the Holiday Inn and Crowne Plaza portfolios is also ensuring that we are well positioned for future growth.

“While we remain vigilant to fluctuating Covid restrictions in different markets, the pace of returning demand is very encouraging as travel increasingly re-opens in every region.

“The strength of our brands, platforms and scale gives us confidence in IHG’s future prospects and of both exceeding prior levels of profitability and delivering industry-leading net system size growth in the coming years.”

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