First-half
results for InterContinental Hotels Group showed business travel revenues making month-on-month
gains, with June showing just a 1 percent deficit compared to 2019. Rising room
rates lifted those results, as business travel volumes themselves remained approximately
10 percent behind pre-pandemic levels, with lingering weakness in the group sector,
in particular, “but rates are still up.” Confidence reigned among executives
for business travel including meetings and events, however, with IHG CEO Keith
Barr seeing “no indicators that the recovery trajectory is abating.”
Overall
performance metrics for IHG improved in the first half of 2022, compared to the
same period in 2021. Increased demand in most markets lifted
occupancy 10 percentage points higher than 2021. Increased pricing power improved
average daily rate by 24 percent and resulted in group revenue per available
room up by 51 percent for the half.
Regionally for the second quarter, which showed
significant sequential gains over the first, ADR hit $134.10 in the Americas,
up 20 percent year over year, with occupancy rising 8.5 percentage points to
69.6 percent. For Europe, Middle East, Africa and Asia (not including China) ADR
reached $127.35, up 35 percent year over year with occupancy rising nearly 29
percentage points to 64 percent. Greater China, which continued its cautious
border strategy, remained far behind other market in recovery for Q2. ADR fell
nearly 9 percent YOY to $65.75, with occupancy tumbling nearly 20 percentage
points to 39 percent.
First Half Earnings & Pipeline
IHG’s
adjusted year-on-year net system size grew 3
percent, despite exits in Russia. The company opened 15,000 rooms across nearly
100 hotels. IHG added 31,000 rooms to its pipeline across 210 hotels.
Revenue in the first half of 2022 was $840
million, an increase of 49 percent over 2021 but still down 17 percent compared
to the same period in 2019.