IHG: Egypt, Bahrain weigh on Q3 hotel revenue

InterContinental Hotels Group has said that political unrest in Egypt and Bahrain continued to have an impact on its revenues in the third quarter of 2011. The company reported a systemwide revenue per available room (RevPAR) increase of 6.4 percent but this dropped to 3.6 percent for the Europe, Middle East and Africa region. Egypt, where IHG has 10 hotels, and Bahrain, where the company has two hotels, dragged that number down because “political unrest continues to result in significant declines,” CEO Richard Solomons said in a statement. Elsewhere in the Middle East, RevPAR grew more impressively, such as 10.9 percent growth in Saudi Arabia and 9.7 percent growth in the UAE, the company added. Globally, IHG improved systemwide in the third quarter in all metrics when compared to the same time period last year. Revenue was up 11 percent from $421m to $467m; operating profit was up 33 percent from $115m to $153m; and net debt was cut from $801m to $644m. Last month IHG said it was likely to announce the introduction of its boutique brand Hotel Indigo to the Middle East within a year. IHG has 38 Hotel Indigo-branded properties globally, with 60 in the worldwide pipeline. While 10 of these pipeline properties are earmarked for the group’s Europe, Middle East and Africa market segment, no Hotel Indigo properties have yet been announced in the Middle East. However, expansion of the brand into the Middle East is “firmly on the agenda”, with a new property expected to be announced in the UAE or Saudi Arabia within the next 12 months, said Karin Sheppard, IHG’s senior vice president for sales and marketing – Asia, Middle East & Africa.