Driven by demand recovery in the Americas and despite a drag from China, IHG reports 34% increase in total revenue for last year as well as 37% bump in RevPAR.
InterContinental Hotels Group (IHG) missed slightly on
Street expectations for full-year 2022 results, reporting revenue of $1.84
billion as well as a 55% increase in operating profit of $828 million. The miss
was offset by news coming CEO Keith Barr, who said that the board is recommending
a 10% increase in the final 2022 dividend and announced a further share buyback
program to return an additional $750 million to shareholders in 2023.
Not unlike the other industry giants, IHG showed significant
improvement in trading for 4Q22 and the full year 2022, reporting on Tuesday
that gross revenue for 2022 reached $25.8 billion, a 33% increase over 2021 and
-8 versus 2019. Global RevPAR was up 37% versus 2021 and -3.3 versus 2019,
while 4Q22 global RevPAR was up 26% versus 2021 and +4.1% versus 2019. The strongest
recovery came in Americas with RevPAR +3.3% versus 2019 (4Q +9%); EMEAA
improving to -7.5% (4Q +8.8%); Greater China -38% (4Q -42%).
Average daily rate was up 18% versus 2021, +8% versus 2019;
and occupancy +9 percentage points versus 2021, -7 percentage points versus
IHG opened and added 49,400 rooms (269 hotels); its global
estate now sits at 912,000 rooms (6,164 hotels). IHG also signed 80,300 rooms
(467 hotels), marking a 17% increase YOY; its global pipeline now is at 281,000
rooms (1,859 hotels), +3.9% YOY. Signings mix drives pipeline to be weighted
54% across midscale segments and 46% across upscale and luxury. Conversions
have continued to grow in importance, representing around a quarter of signings
and a third of openings in 2022 (excluding Iberostar Hotels & Resort). More
than 40% of the global pipeline is under construction, broadly in line with
Announced in November 2022, the long-term commercial
agreement with Iberostar 48 hotels (18,467 rooms), IHG said it is investing in
further integration costs, the net impact of which on operating profit from
reportable segments is expected to be US$10-15 million. The Iberostar agreement
is then expected to turn to a positive contribution in 2024, before ramping up
significantly from 2025 with the final step up in the fee structure and the
expected shift in distribution channel mix that IHG is expected to deliver.
IHG’s pipeline also includes five Iberostar Beachfront
Resorts properties that are expected to be built and opened in future years.