InterContinental Hotels, the world's biggest hotelier, beat forecasts with a 38 per cent dip in first-half profit and moved to cut costs deeper as it expected tough trading to continue through 2009.
The British group, which operates the InterContinental, Crowne Plaza and Holiday Inn brands, said forward booking data showed no further deterioration in demand with July benefiting from stronger leisure demand from holidaymakers.
“Trading was very challenging throughout the first half of the year and we expect the remainder of 2009 to be tough,” chief executive Andrew Cosslett said in a statement on Tuesday.
InterContinental, which runs almost 630,000 rooms in over 4,300 worldwide hotels, reported adjusted operating profit of $179 million for the first half of 2009, while its half-year dividend was unchanged at 12.2 cents.
Continuing operating profit dipped to $174 million, above a consensus of $162 million and a range of $152-$173 million in a survey of eight analysts by Reuters.
The group raised its cost savings target for 2009 to $80 million from $70 million. The new figure comprises at least $40 million of sustainable savings, $20 million of currency benefits and $20 million of non-sustainable savings.
First-half revenue per available room (RevPAR) - a key industry measure - fell 16.2 per cent with a second-quarter decline of 18.6 per cent, while the group said its brands outperformed the industry across all its regions.
The group which also runs Staybridge Suites and Hotel Indigo said it was still on track to add 400 hotels this year and on target with its $1 billion relaunch of its Holiday Inn brand with 1,040 hotels operating under its new standards.
Reuters