InterContinental beats profit forecasts

THE return of business travellers helped the world's biggest hotelier, InterContinental Hotels, beat forecasts with a 15 per cent rise in first-quarter profits.

The British group, which operates the InterContinental, Crowne Plaza and Holiday Inn brands, posted operating profits of $83 million (55m) for the first three months of 2010.

The hotelier, which has 640,000 rooms in more than 4,400 hotels worldwide, said revenue per available room (revpar), a key industry measure, rose 0.2 per cent in the first quarter and then saw a rise of 5.2 per cent in April.

Chief executive Andrew Cosslett said business travel is returning, although mainly at the luxury end of the market which was most affected by recession, and he expects a more resilient mid-market sector to benefit as the year progresses.

He said: "With this strengthening of our core business and the early signs of recovery in the market we are feeling confident about the outlook and our ability to grow market share."

The group reported its first rise in revpar for 18 months, driven by improving occupancy levels, with Asia and particularly China leading the rebound, but it said room rates remain under pressure in many markets.

Shares in InterContinental have more than doubled from a low of 434p in March 2009 on recovery hopes.