InterContinental Hotels Group reports increase in profits

InterContinental Hotels Group reports increase in profits

InterContinental Hotels Group has seen second-quarter net profit increase to $121 million from $87 million on revenue of $469 million, up from $454 million.

Operating profit before exceptional items in the six months to June 30th rose 6.3 per cent to $286 million, in line with market expectations.

Richard Solomons, chief executive of InterContinental Hotels Group, said: “We have delivered good results in the first half with RevPAR growth from all regions through gains in both occupancy and rate.

“Our brands continue to perform well and we have achieved solid underlying margin growth, resulting in increased profits and strong cash flows.

IGH confirmed it would increase the interim dividend by 31 per cent to reflect the positive results.

IHG largely operates a franchise model in partnership with hotel owners rather than owning them directly, and is the largest hotel group in the world by rooms offered.

Solomons went on to add: “Consistent with our asset light strategy and our strong track record of returning funds to shareholders, we today announce a $1bn return of capital.

“This recognises the expected proceeds from the ongoing disposal of InterContinental New York Barclay and our commitment to maintaining an investment grade credit rating.”

IGH said it planned to continue to invest for growth, strengthening both it existing and new brands, including EVEN Hotels and HUALUXE Hotels & Resorts.

“While the global economic environment remains uncertain, IHG continues to trade well and we are confident that our strategy will deliver high quality growth into the future,” concluded Solomons.