IHG RevPAR growth slows in Q3, but China back to pre-Covid levels

(Sharecast News) - International hotels group IHG reported a big slowdown in RevPAR - a key performance measure used in the hospitality industry - in the third quarter as growth softened across all regions, but said it still expects a "very strong financial performance" this year. Group RevPAR (or revenue per available room) was up 10.5% year-on-year in the third quarter, with Americas growing 4.1%, EMEAA increasing 15.9% and Greater China rising 43.2% In the first half, overall RevPAR growth came in at 24%, with Americas up 11%, EMEAA up 42% and Greater China up 94%.

Nevertheless, the company pointed out that RevPAR in the Greater China region is now back above pre-Covid levels in 2019 - something that the Americas achieved in the second quarter of last year and Europe, Middle East, Africa & Asia in the fourth quarter.

Group RevPAR was 12.8% ahead of the corresponding quarter in 2019.

Chief executive Elie Maalouf said the demand for travel "remained very health during the quarter".

"Group-wide occupancy was 72%, just one percentage point behind 2019 which further confirms the near-complete return to pre‑Covid levels of demand. Pricing remained very robust. As well as year‑on‑year RevPAR growth in each of our three regions, it was also pleasing to see rooms revenue growth for each of leisure, business and group travel."

During the third quarter, the net number of rooms under its portfolio of brands increased 4.7% year-on-year to 930,000 across 6,261 hotels.

Looking forward, Maalouf said: "As IHG powers forward to provide industry-leading advantages for our guests and hotels owners across our brand portfolio, loyalty programme and entire enterprise platform, we expect to close-out 2023 with very strong financial performance."