InterContinental Earnings Decline on Lower Revenue
Published on Aug 5 2014 9:50 AM in Hotel
InterContinental Hotels Group Plc, Europe’s second-largest publicly traded hotel operator, said first-half profit declined 8 per cent as the company generated less revenue.
Operating profit before exceptional items and tax fell to $310 million from $338 million a year earlier, the England-based company said in a statement today. Revenue declined by 3 per cent to $908 million.
“Whilst several of our key markets continue to experience some political or economic uncertainty, we are encouraged by current trading trends,” chief executive officer Richard Solomons said in the statement.
Marcato Capital Management LP, a hedge fund that owns about 4 per cent of InterContinental, yesterday said it hired Houlihan Lokey to conduct a strategic review of the company to find ways to increase shareholder value. The announcement followed a May report by Sky News that the company had spurned a takeover bid that valued it at about £6 billion. InterContinental declined to comment on the bid speculation or the strategic review.
Revenue per available room, an industry measure of occupancy and rates, increased 5.8 per cent globally and 6.7 per cent in the Americas. Revenue in the Americas, which accounts for about half of the total, dropped 5 per cent to $435 million.
InterContinental has a market value of £5.58 billion. Accor SA, its biggest European competitor, is valued at €8.18 billion.
Bloomberg News, edited by Hospitality Ireland