MercoPress. South Atlantic News Agency

InterContinental Hotels report loss: “business remains elusive”

Revenues sank by nearly 25% to 375 million dollars in the first half of 2009.

The British group which manages InterContinental Hotels, Crowne Plaza and Holiday Inn revealed that it plunged into losses in the first six months of 2009 and forecast a “tough” second half as the recession keeps business travellers at home. That compares with a net profit of 163 million dollars in the same part of 2008.

InterContinental is the world's largest hotel operator by number of rooms and said in a results statement that it faced a net loss of 29 million dollars in the six months to the end of June. Revenues sank by nearly 25% to 375 million dollars in the reporting period.

“Trading was very challenging throughout the first half of the year and we expect the remainder of 2009 to be tough,” IHG chief executive Andrew Cosslett said in comments accompanying the earnings release.

“We have made good progress on improving efficiency and reducing costs as we make more effective use of our scale. We will continue to invest behind our system to drive revenue and grow market share.”

Revenue per available room, or RevPAR -- a key performance indicator for the industry -- fell 16.2% in the first half of 2009, as a deep global recession showed no sign of abating.

“Business travellers remain elusive” Cosslett told reporters after publication of the results. “We can't see anything in our numbers at the moment to suggest we've hit the bottom”.

“It could be a couple of years before we get back to the levels we were at,” he warned.

However Cosslett sought to reassure investors by arguing that the company was in a good position to benefit from an economic turnaround.

“We will outperform the competition and be well positioned for the upturn,” he said.

IHG owns, manages, leases or franchises more than 4.300 hotels and nearly 630.000 guest rooms in about 100 countries across the world.