Holiday Inn owner IHG boosted by World Cup after Iran war hit bookings

InterContinental Hotels Group has drawn on a surge in World Cup-related travel to offset a sharp deterioration in its Middle Eastern business - (PA Archive)

Increased booking demand linked to the World Cup has helped Holiday Inn owner InterContinental Hotels Group (IHG) counter downturns caused by the war in Iran across its Middle Eastern operations.

The group stated that revenue per available room (RevPAR)—a key performance metric for the hotel industry—grew 4.8 per cent in the Americas during the first half, with growth reaching 5.4 per cent in the second quarter.

This was driven by strong performance in locations hosting World Cup football matches, which contributed approximately 1 per cent to overall growth.

The boost assisted the company in navigating the impact of the Middle East conflict. Half-year revenues and earnings rose overall, even as the war impacted trading across the region and disrupted some broader international travel following its onset on 28 February.

Underlying revenues rose 6 per cent to $1.26 billion (£930 million) for the six months to 30 June, while operating profits increased 10 per cent to $665 million (£492.4 million).

On a statutory basis, however, pre-tax profits fell 9 per cent to $578 million (£428 million).

The group stated that revenue per available room (RevPAR)—a key performance metric for the hotel industry—grew 4.8 per cent in the Americas during the first half, with growth reaching 5.4 per cent in the second quarter (IHG Hotels & Resorts)

Across global markets, RevPAR increased 4.1 per cent over the first six months, though second-quarter growth slowed to 3.5per cent from 4.4 per cent in the first quarter as conflict in the Middle East weighed on trading.

RevPAR across the Middle East, accounting for 5 per cent of IHG’s system size globally, slumped by nearly a fifth, down 19 per cent in the second quarter, following a 2 per cent drop in the previous three months.

Elie Maalouf, chief executive of IHG Hotels & Resorts said: “While there are ongoing impacts from the Middle East conflict, including some wider disruption to international travel flows, we continue to expect these to be fully offset by growth in demand elsewhere.”

In the UK, its third largest market with 378 hotels, the firm said RevPAR rose 3.1 per cent in the second quarter, and there was 2.3 per cent growth in Continental Europe and 6 per cent in Asia Pacific.

Greater China saw first half growth of 3.1 per cent, with the first quarter boosted by Chinese New Year celebration bookings.