Intercontinental Hotels' profits up as China sales rise

InterContinental Hotels Group

Last Updated at 01 Sep 2014, 11:36 ET *Chart shows local time InterContinental Hotels Group intraday chart
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Intercontinental Hotels (IHG), the world's biggest hotelier, has reported a sharp jump in profits, thanks in part to increased sales in China.

Pre-tax profit for the three months to the end of June was $178m (£114m), up 60% on the $111m the company made a year ago. Revenue was up 3% at $469m.

The owner of the Holiday Inn and Crowne Plaza brands also announced a $1bn return of capital to shareholders.

Dividends would increase by 31% as a result, it said.

"We have delivered good results in the first half with revenue per room growth from all regions, through gains in both occupancy and rate," said chief executive Richard Solomons.

"Our brands continue to perform well and we have achieved solid underlying margin growth, resulting in increased profits and strong cashflows."

Overall revenue rose by 17% in China and by 6% in Europe, but fell slightly in the US.

Mr Solomons said he expected the company to continue to "trade well" despite global economic uncertainty.

Shares in IHG were up 7.5% at midday.

Last week, the UK's Office of Fair Trading said IHG, together with online travel agencies Booking.com and Expedia, had agreed to fix prices, according to an initial investigation.

The three companies deny any wrongdoing and have three months to respond to the accusations.

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