IHG shares fall as Q3 results miss expectations amid regional weakness By Investing.com
Investing.com — InterContinental Hotels Group (LON:) reported a 1.5% increase in revenue per available room (RevPAR) in the third quarter, driven largely by strong demand across the EMEA region.
However, the results were influenced by weak conditions in the US market and ongoing challenges in China, the company said in a statement.
The EMEA region emerged as a bright spot, posting a 4.9% increase in RevPAR during the quarter. This growth reflects an increase in business travel and group bookings, which remain strong across the region.
Key contributors include Continental Europe and the East Asia & Pacific sub-region, where RevPAR growth reached 7.1% and 6.5% respectively.
In contrast, operations in the Middle East fell slightly by 3.2%, reflecting regional variation in demand.
In the Americas, IHG’s performance fell sharply, with RevPAR up 1.7%. The US market—where the company’s Holiday Inn and Crowne Plaza brands are staples—showed weak momentum, reporting only a 1.2% increase.
Group bookings remain a source of strength, with group-related room revenue growing 7%, but leisure travel saw a slight decline of 1%, reflecting weak consumer sentiment.
While there was some growth across the Americas in terms of new openings, growth remained modest compared to other regions.
China remains a challenging market for IHG, with RevPAR down 10.3% year-on-year, hampered by a negative comparison to the same period last year, when domestic travel is booming.
The region also experienced disruptions from hurricanes and public holiday disruptions, which exacerbated the economic downturn.
Despite this quarter’s setbacks, IHG remains optimistic about long-term prospects, noting that 2024 is poised to be one of the company’s biggest years for new hotel openings and signings in China.
