Leisure demand continued to boost IHG Hotels & Resorts' recovery during the first half of 2021, but "we are now seeing more group activity and corporate bookings start to come back," said IHG CEO Keith Barr in a statement on the company's first-half results, released Tuesday. "These trends and the momentum in the business have continued in recent weeks."
The recovery was most advanced in Greater China, with second-quarter revenue per available room down 16 percent compared with the same period in 2019. The United States showed continued improvement, though RevPAR still was off 26 percent versus 2019. The Europe, Middle East, Asia and Africa region struggled most, with a second-quarter decline in RevPAR of 65 percent. The company cited disparities in both vaccine rollout progress and travel restrictions for the regional performance variations.
Systemwide Q2 RevPAR was down 36 percent compared with 2019, with its occupancy level of 53 percent, down 19 percentage points in the same period but improving throughout the quarter, according to the company. Second-quarter occupancy was 69 percent in the United States, 54 percent in Greater China and 40 percent for EMEAA. Average daily rate for the quarter was $102.31, down about 13.5 percent from 2019 levels.
"With occupancy and rate continuing to improve, nearly 50 percent of our hotels achieved RevPAR above 2019 levels in July," Barr said.
IHG opened 132 hotels in the first half of 2021 and signed 203, increases on last year's numbers of 47 and 77, respectively. As of June 30, the company's total system size was 5,994 hotels with 884,484 rooms. IHG's pipeline included 1,805 hotels with 274,184 rooms. More than 40 percent were under construction at the end of the half.
The company reported an operating profit of $188 million in the first half of 2021, compared with $410 million for the first half of 2019, but an improvement over $52 million in 2020.
Luxury Collection Brand Planned
IHG also announced it soon would launch a new luxury and lifestyle collection brand "to capture the increasing opportunities of conversions and further strengthen our position in Luxury & Lifestyle." That would bring the company's number of brands to 17. IHG already counts five brands in its Luxury & Lifestyle group: Six Senses, Regent, InterContinental Hotels & Resorts, Kimpton Hotels & Restaurants and Hotel Indigo.
"There are around 1.5 million independently run rooms in the market segments we are targeting, and we expect the collection to attract more than 100 hotels within 10 years," Barr said.
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