LONDON (Reuters) - World No 1 hotelier InterContinental Hotels Group Plc (IHG.L) said its trading momentum was good in August and September and it had not seen any significant impact from global recession fears and mounting debt concerns in the United States and Europe.
New Chief Executive Richard Solomons said his British group, home to the Crowne Plaza as well as Holiday Inn and InterContinental brands, had yet to see any real effect from any dip in external economic activity.
“We are not saying there will be no impact, but right now we don’t really see any impact from (any downturn in) external economic activity,” he told Reuters in an interview on Friday.
Solomons said his group had weathered the recession following the Lehman Bros collapse in 2008 better than its competitors, and was confident but not complacent on prospects as the group has low debt and an investment-grade rating.
“We don’t see anything in our numbers today that tells me that there is any difference in our momentum,” he added, noting the group had reasonable visibility for hotel bookings for the rest of this year, but a big test could come in 2012.
Investors worry that the uncertain macroeconomic environment and fears over the sovereign debt crisis will start to have a effect, as slower economic growth will eventually feed through into lower growth for hotel groups.
Solomons said the U.S. hotels industry, which accounts for a quarter of worldwide hotel rooms, had seen a record August month in terms of rooms booked, and added his group had always beaten the industry.
In early August, the group beat half-year profit forecasts and said it was looking forward with confidence despite an uncertain economic outlook, though there was a slowdown in growth with revenue per available room (RevPAR), a key industry measure, rising 6.9 percent in the first quarter, 6.5 in the second and 5.6 in July.
Some other hoteliers were upbeat recently, with France’s Accor (ACCP.PA) reporting in late August that it had seen no impact on its September bookings from global recession fears, while U.S. chains Marriott MAR.N and Starwood HOT.N have not reported since stock markets tumbled in early August.
Solomons said the hit to group 2011 profits from political unrest and earthquakes was likely to be towards the bottom of its previous $15-20 million (9.5 million-12.6 million pound) forecast range, as while Egypt was still a problem market, Japan had recovered quickly.
He reported good interest for the Barclay New York InterContinental hotel and was well placed to sell it by the end of the year, with analysts putting a value of $300-350 million on one of the group’s few remaining fully-owned hotels.
InterContinental shares ended down 2.3 percent at 10.11 pounds, in line with a lower London stock market as the FTSE 100 index .FTSE closed down 2.4 percent.
Editing by Paul Sandle and David Holmes