(Alliance News) - InterContinental Hotels Group PLC on Tuesday posted a swing to loss for 2020, a year in which the hospitality industry was hammered by coronavirus restrictions across the globe.
Total revenue for 2020 slumped 48% to USD2.39 billion from USD4.63 billion, with the Denham, England-based company swinging to a pretax loss of USD280 million from a USD542 million profit in 2019.
The results came in below market expectations. Consensus estimates for pretax profit ranged from USD4.1 million to USD129.1 million, according to forecasts compiled by Vuma.
IHG reported a USD150 million reduction in fee business costs, targeting USD75 million to be sustainable into 2021, while still investing for growth.
RevPAR - revenue per available room, a key metric in the hotels industry - fell 53%, though IHG noted the variation by region reflected local market Covid-19 restrictions and recovery pace. Greater China's recovery was most advanced, with fourth quarter RevPAR down 18%, while the Americas was down 50% and Europe, the Middle East & Africa down 71%.
This was in line with market forecasts, which expected RevPAR to fall by between 50% and 57%, according to the Vuma consensus. IHG's RevPAR came in 0.3% lower in 2019, the first decline since 2009.
The company said its global estate now consists of 886,000 rooms across 5,964 hotels, with 0.3% net system size growth year-on-year. During 2020, IHG said it opened 39,000 rooms in 285 hotels, 4.5% gross growth.
"The shape of recovery remains varied globally, but we've continued to outperform the industry in key markets thanks to the strength of our teams, business model and segments in which we compete. This includes our industry-leading position in upper midscale, where demand remains stronger," said Chief Executive Keith Barr.
IHG proposed no final dividend for 2020 and did not pay out anything at the interim stage, though the FTSE 100 constituent said it will consider future dividends "once visibility of the pace and scale of market recovery has improved". In 2019, IHG paid out 39.9 cents per share.
In a separate statement, the company said it appointed Daniela Soares and Richard Anderson as independent non-executive directors, effective from March 1.
The move follows the planned retirement of Non-Executive Director Anne Busquet, effective at IHG's 2021 annual general meeting.
The company said these changes also reflect IHG's ongoing commitment to succession planning and ensuring a diverse board composition that reflects its stakeholders and the communities in which it operates.
Soares is currently CEO of Snowball Impact Management Ltd and a designated member of Snowball Impact Investments GP LLP. She is also an independent non-executive director at FTSE 100 company Halma PLC.
Anderson is the former CEO of US passenger railway Amtrak. He also previously spent more than 25 years in the aviation industry, last holding the position of executive chair at Delta Air Lines Inc.
IHG shares were trading 4.0% higher in London on Tuesday morning at 5,524.84p each.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
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InterContinental Hotels (IHG)
Halma (HLMA)