InterContinental Hotels Group (IHG), the London-listed hotel chain known for its Crowne Plaza and Holiday Inn brands, has announced its earnings for the first half of the year. The results reveal impressive growth for the company:
Net Profit Soars
IHG reported a net profit of $459 million for the first half of the year, a significant increase compared to $216 million in the same period of 2022.
Revenue Growth
The hotel chain also experienced a notable increase in revenue, which reached $2.23 billion, up from $1.79 billion in the previous year. Analyst Jarrod Castle from UBS confirms that this surpasses the consensus estimate of $2.2 billion.
Strong Underlying Earnings
IHG’s underlying earnings before interest and taxes (EBIT) saw impressive growth as well. The company reported underlying earnings of $566 million, compared to $380 million in the previous year and exceeding the consensus estimate of $470 million.
Key Highlights
Net Unit Growth Beats Expectations
One important aspect of IHG’s performance is its net unit growth (NUG). For the first half of the year, NUG reached 4.8%, outperforming the consensus estimate of 4.3%.
Impressive RevPar Growth
Revenue per available room (RevPar), a key metric in the hospitality industry, experienced significant growth. Year-on-year, RevPar rose by 24%, with the Americas region seeing an increase of 11%, Europe, Middle East, Africa and Asia region witnessing a surge of 42%, and greater China recording an impressive 94% growth. These numbers highlight the varying levels of travel restrictions that were still in place during this period. Furthermore, IHG reported that since July 2022, group RevPar has consistently exceeded pre-pandemic levels seen in 2019.
Launching a New Brand
IHG’s growth strategy includes the introduction of a new brand targeting midscale conversion. The company sees this segment as a major growth opportunity, as it accounted for approximately 40% of global hotel openings and signings during the first half of the year. IHG also mentions that more than 100 hotels have already expressed interest in this new brand.
These positive earnings confirm IHG’s strong performance and indicate a promising outlook for the future.
