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UPDATE 2-Holiday Inn owner points to recovery after first half slump

Tue, 11th Aug 2020 07:47

* IHG sees 'very early' signs of improving demand

* H1 profit down 82%, RevPAR down 52%

* Sees July RevPAR down 58% vs Q2 ~75% fall in Q2

* Shares up as much as 4%
(Recasts, adds shares, details)

By Yadarisa Shabong

Aug 11 (Reuters) - InterContinental Hotels said on
Tuesday it was seeing some "very early" signs of improvement in
demand after the Holiday Inn-owner's revenue more than halved
and profit slumped 82% in the first half of 2020.

IHG, whose other brands include the Crowne Plaza, Regent and
Hualuxe hotel chains, also underlined that it had limited
visibility on when the travel market would recover after six
months that have seen billions in business travel and holidays
cancelled due to the pandemic.

"The impact of this crisis on our industry cannot be
underestimated, but we are seeing some very early signs of
improvement as restrictions ease and traveller confidence
returns," Chief Executive Officer Keith Barr said.

In line with other major hotel operators, IHG's revenues in
the six months to June 30 dropped 52% to $488 million and
adjusted operating profit was $74 million, down from $410
million a year earlier, as the group strove to cut costs and get
hotels up and running again.

However, it said there were "small but steady" improvements
in hotel room revenues (RevPAR) - a key gauge of performance for
the hotel industry - with July RevPAR seen down 58% after a near
75% slump in the second quarter.

Shares in the company, which have fallen around 20% this
year, were up as much as 4% by 0722 GMT.

Some major hotel operators around the world, such as
Europe's biggest hotel group Accor, Premier-inn owner
Whitbread and Hyatt Hotels, have resorted to staff
cuts to stem a rise in costs as they battle one of the worst
downturns in the hotel industry.

IHG said it was on track to reduce costs in its fee business
by about $150 million this year.

The company did not propose an interim dividend and said it
has total available liquidity of $2 billion.
(Reporting by Yadarisa Shabong and Samantha Machado in
Bengaluru; Editing by Aditya Soni/Patrick Graham/Susan Fenton)

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