(Reuters) -Holiday Inn-owner IHG Plc reported higher full-year profit on Tuesday, helped by strong occupancy demand during the holidays and higher room prices, and said it would buyback shares worth an additional $750 million in 2023.
Hotel operators have benefited as people are now spending more on travel and booking longer hotel stays after pandemic restrictions were lifted, raising occupancy rates and prices, but they face a risk from stubborn inflation and cost-of-living woes worldwide.
The London-listed company said operating profit from reportable segments for the full-year ended Dec. 31 rose 55% to $828 million, while revenue per available room (RevPAR) in the second half of the year – a key measure for a hotel’s top-line performance – exceeded pre-pandemic levels of 2019.
“Looking to 2023, while there are economic uncertainties, we expect continued strong leisure demand in many markets, alongside further return of business and group travel and the ongoing reopening of China,” IHG Chief Executive Officer Keith Barr said in a statement.
The Crowne Plaza, Regent and Hualuxe owner said the Americas market saw the strongest recovery, with RevPAR in the year up 3.3% from 2019, while Greater China was down 38% as travel restrictions were still in place.
Hotel chains were affected by uneven recovery in China as a rise in COVID-19 infections led to indefinite lockdowns.
The latest additional buyback comes after the company said in August it would back shares worth $500 million.
(Reporting by Radhika Anilkumar in Bengaluru; Editing by Rashmi Aich)
