Holiday Inns owner InterContinental Hotels (IHG) hit the headlines late last month after a probe by the Office of Fair Trading investigation raised concerns about the group's relations with two online travel agents.
Tuesday's interim results from IHG should bring happier news, with broker Jefferies expecting a 4% rise in sales to $881m, a 5% hike in earnings before interest and tax (EBIT) to $282m and a 7% rise in earnings per share (EPS) to 62 cents. The interim dividend is tipped to rise by one-tenth to 17.6 cents.
Revenue per available room - or revPAR in the industry jargon - is the key metric for hotels, and Jefferies reckons a 65 rise in revPAR is on the cards in the Americas and Greater China but, not surprisingly, the picture may be less rosy in Europe; Jefferies is going for a 2% year-on-year increase in revPAR in Europe. The Asia, Middle East and Africa region is seen delivering 3% revPAR growth.
"Recent numbers from Starwood and Marriott would indicate that this [revPAR growth] should be at least achievable, and could be slightly better. We estimate that every 1% on group RevPAR adds about 3% to EBIT," the broker said.
The shares have been in demand since activist investor Trian took a stake of around 4%. Jefferies thinks expectations of a capital return are high and if there is no reference to this in the interim results then the shares could see a spot of profit-taking.
Next week is a fairly big week for mining company results, with Xstrata, Rio Tinto, Randgold Resource and Aquarius Platinum all set to report.
Results statements from the latter have been getting increasingly grumpy about the hassles of operating in South Africa and so Stuart Murray, Aquarius's Chief Executive Officer, is likely to be especially scathing about recent events, which saw disgruntled former workers attack the production unit at Kroondal, near to Rustenburg in the North West Province.
The "serious security incident" saw at least three people killed and at least 20 injured, and forced the suspension of production at the Kwezi shaft.
On the economic front, the big release of the week is the Bank of England's inflation report on Wednesday.
Monday August 06
Catlin Group Ltd., Morgan Sindall Group, PostNL NV, Puricore, Share Plc, Telecity Group
Datafeed and UK data supplied by NETbuilder and Interactive Data.
While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk!
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.