IHG reports 34% increase in revenue for 2022

Holiday Inn owner IHG Hotels & Resorts has continued its pandemic recovery, reporting a 34% increase in total revenue for last year to $3.89b (£3.24b), driven by strong recovery in the Americas.

This included a 37% increase in global revenue per available room (revpar) for the year compared to 2021, although still 3.3% lower than 2019, and a nearly 50% increase in pre-tax profit to £540m (£449m).

Average daily rate (ADR) was 18% up on 2021, 8% on 2019, and adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) was $896m (£745m), up 42% against 2021.

The group’s Europe, Middle East, Africa and Asia (EMEAA) business saw an 82.2% improvement in revenue to £552m (£459m). Revenue per available room (revpar) improved by 93.2% and average daily rate (ADR) by 28.2% on 2021. Against 2019 levels, ADR was 8.7% higher while revpar still lagged 7.5%.

As Covid-related travel restrictions have lifted, IHG said demand “swiftly recovered”, with group revpar exceeding 2019 levels each month from July onwards. By the fourth quarter of the year, group revpar was 4% ahead of 2019 levels, with the Americas and EMEAA both 9% ahead, offsetting Greater China, which was still 42% down due to restrictions.

The business's agreement with Iberostar Beachfront Resorts in November 2022 saw 12,400 rooms added to IHG's system in December. In total, the group opened and added 49,443 rooms to its portfolio during the year, taking its global estate to 912,000 rooms. It also signed 80,300 rooms, taking its global pipeline to 281,468, weighted 54% across midscale segments and 46% across upscale and luxury. Nearly 30% of signings are in the EMEAA region.

Conversions have continued to grow in importance, representing around a quarter of signings and a third of openings in 2022, excluding the Iberostar signing.

“In 2022 we saw demand return strongly in most of our markets, pushing group revpar back close to 2019 levels and fee margin ahead. It's particularly pleasing that in the second half of the year we exceeded 2019 levels for both revpar and profitability. 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,” said chief executive Keith Barr.

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