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The battered global hotel industry is starting to see the shoots of recovery, according to an update released on Tuesday by the owner of Holiday Inn.
InterContinental Hotels Group (IHG), one of the world's largest operators with nearly 6,000 sites, reported a significant improvement in trading.
The company said that in July occupancy rates had grown so much that revenue per available room – a common industry measurement – had exceeded 2019’s levels in nearly half of its hotels.
“Trading improved significantly during the first half of 2021, with travel demand returning strongly as vaccines roll out, restrictions ease and economic activity rebuilds,” said chief executive Keith Barr.
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Revenue rose 16 per cent to $565 million (€482m) and the company swung from a $275 million pre-tax loss in the first six months of 2020, to a $67 million profit in the same period this year.
Mr Barr added: “The actions we have taken during the last 18 months position us well to exceed our pre-pandemic level of growth and profitability.
“While there is a risk of trading volatility in the balance of the year, and discretionary business trips, group bookings and international travel will take time to fully recover, we are confident in the strength of IHG’s future prospects.”
The recovery still has a long way to go with China leading the way, with revenue per available room down just 16 per cent compared to 2019. In the Americas the same measurement is down 26 per cent.
The company is most challenged in Europe, Middle East, Africa and Australia, with revenue per available room is still 65 per cent lower than in 2019.
The business said it would not pay an interim dividend to shareholders in 2021.
“Trading has improved significantly during the first half of the year leading to profitability rebounding, and the board is confident that the proven highly cash generative nature of our business model will allow resumption of dividend payments in due course,” it said.– PA