InterContinental Hotels' Americas Growth Picks Up
InterContinental Hotels Group (NYSE:IHG), the world's biggest hotelier, is enjoying higher revenue growth at its American operations, highlighting industry resilience in the face of a global economic slowdown.
"The U.S. industry experienced record levels of room night demand in the third quarter as leisure travelers remained resilient through the summer and demand from business travelers stayed strong," InterContinental said in a statement on Monday.
The company, which owns the Crowne Plaza and Holiday Inn brands, said total revenues per available room (RevPAR) at its American operations rose 9.5 percent during the third quarter.
This was up from 6.6 percent a year ago, and outperformed broader industry growth of 7.9 percent.
InterContinental Hotels' shares rose as much as 2.9 percent on Monday, making the stock one of the best performers on Britain's benchmark FTSE 100 index <.FTSE>. The stock slipped back to trade up 0.9 percent during the mid-morning session, outperforming a 0.3 percent rise in the FTSE.
"The strong third quarter performance underscores our confidence in our full year forecasts and we see scope for modest upgrades if trading continues its recent momentum," Numis Securities said in a research note, keeping a "buy" rating on InterContinental Hotels' shares.
HOTEL SECTOR'S RESILIENCE
According to Thomson Reuters I/B/E/S estimates, InterContinental Hotels is expected to post 2011 operating profits of around $520 million, up from $444 million in 2010.
"For the time being, demand from business customers remains solid and this trend should continue into 2012," said Raymond James analyst Julien Richer, who kept an "outperform" rating on InterContinental's shares.
Leading global hotel companies have so far managed to shrug off any major side-effects from the economic slowdown.
Earlier this month, rival Marriott International's <MAR.N> third-quarter profit beat market expectations and Accord put in a similarly robust performance And upbeat outlook.
In September, InterContinental Hotels Chief Executive Richard Solomons told Reuters that his group had weathered the recession following the Lehman Bros collapse in 2008 better than its competitors.
(Reporting by Sudip Kar-Gupta; Editing by Myles Neligan and Andrew Callus)