InterContinental Hotels Group reported tepid growth in both
average daily rate and occupancy in the Americas during the third quarter.
The Americas saw ADR increase 0.7 percent to $121.66 and
occupancy remain almost flat with a 0.1-percentage-point increase to 74.9
percent. "The slow pace of growth in the third quarter was consistent with
the wider U.S. industry, which continues to operate at record levels of
demand," IHG CFO Paul Edgecliffe-Johnson said during the company's
earnings call. "U.S. industry demand growth has accelerated in 2017 and
continues to outpace GDP growth, as it has since 2010, something that was not
common in previous cycles."
He said U.S. supply growth is on pace to exceed the
long-term average but limiting factors like the availability of financing
"give us confidence that this pace of growth shouldn't take a significant
step up. Hurricanes Harvey, Irma and Maria, which struck the U.S. and the
Caribbean, had a "mixed impact" on results, Edgecliffe-Johnson said.
"Our franchise business benefited from increased demand
relating to the displacement of residents and accommodating of those associated
with the relief and reconstruction efforts," he said. "In contrast,
our managed business was negatively impacted by group cancellations in our
full-service hotels."
RELATED: IHG Q2 earnings
IHG's systemwide ADR rose 0.8 percent year over year in the third quarter to
$115.94, while occupancy increased 1.1 percentage points to 75.2 percent.
Europe reported a 4 percent gain in ADR to $111.47 and a 2.3 percentage point rise
in occupancy to 81.1 percent. The Asia, Middle East and Africa region posted a
1 percent decline in ADR to $129.69 and a 1.1-percentage-point rise in occupancy
to 72.9 percent. Greater China had the third-quarter's greatest occupancy gain,
4.5 percentage points to 71.1 percent, while ADR grew 0.8 percent to $115.94.
The company's total pipeline as of Sept. 30 was
234,700 rooms across 1,553 properties. The Americas and Greater China claim the
largest shares of that pipeline, 44 percent and 31 percent, respectively.