David Jones London

InterContinental Hotels is looking to emerging markets and especially China to drive future growth after a recovery in the US and a string of new Chinese hotel openings helped push 2011 profit up 26 percent.

The hotelier, home to the Crowne Plaza and Holiday Inn chains, as well as the InterContinental brand, said yesterday business was improving in the US, led by a healthier economy and job creation in a region that provided about two-thirds of the group’s profit.

Greater China, which was reporting numbers as a separate region for the first time, saw the group’s highest growth rate as it opened more than 8 000 new rooms in the year, while more than a quarter of its new global hotel pipeline is in China.

Chief executive Richard Solomons said that despite the euro zone crisis he was upbeat about the future as people still wanted to travel and emerging markets were growing strongly.

“We go where the travellers are. We see good momentum in the US economy with economic data there quite positive while China is our fastest-growing region and our business there has doubled in the last two years,” Solomons said.

Growth in global revenue per available room, a key hotel industry measure, grew at 6.2 percent last year, with the US and China ahead 7.9 percent and 10.7 percent, respectively. While there was a fourth-quarter slowdown worldwide to 4.6 percent, the January growth recovered to 6 percent.

“We expect that a continuing strong performance in the US and Asia will likely lead to 5 percent-plus upgrades to consensus 2012 forecasts,” said analyst Ian Rennardson at brokers Jefferies.

The group lifted operating profit 26 percent to $559 million (R4.3 billion), beating a ThomsonReuters consensus estimate of $543m. – Reuters