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Hotelier IHG revenue per room growth hit by timing of Easter holiday
BUCKINGHAMSHIRE,UK]InterContinental Hotels Group (IHG) on Tuesday reported slower global growth in revenue per room in the second quarter, hurt by a decline in US growth due to a later Easter this year.
The company, which runs hotels under brands such as Crowne Plaza, Holiday Inn and InterContinental, said revenue per available room (RevPAR) grew 1.5 per cent in the three months to June 30, down from 2.7 per cent in the first quarter and 2.5 per cent a year earlier.
The Easter holiday, when there are fewer business travellers, was in the second quarter this year, having been in the first quarter last year.
The company, which runs more than 5,000 hotels in about 100 countries, had in May reported a strong first quarter, resulting in the group on Tuesday reporting an 8 percent rise in operating profit for the first six months of the year to US$370 million.
Hoteliers face rising competition from online holiday rental operators such as Airbnb, prompting a wave of consolidation including Marriott's purchase of Starwood Hotels & Resorts Worldwide.
IHG, however, has indicated it plans to go it alone and has instead reduced its ownership of hotels to expand via a cheaper fee model, under which it franchises and manages hotels. It has also focused on business customers to head off the challenge from the likes of Airbnb.
In May, the company said Chief Commercial Officer Keith Barr would succeed Richard Solomons as chief executive, indicating a greater focus on the Chinese market as well as on marketing to help retain customers.
Mr Barr said IHG would focus on increasing efficiency to generate funds to help with his focus on driving an acceleration in IHG's growth, by strengthening its brand portfolio and spending more resources in the highest-opportunity markets.
"While we will always face macro-economic and geopolitical uncertainties, we remain confident in the outlook for 2017," Mr Barr said in a statement.