In a landmark achievement, InterContinental Hotel Group (IHG) reported a profit exceeding $1 billion for 2023.
- A 23% increase in operating profit driven by strong performances from Holiday Inn, Crowne Plaza, and Iberostar.
- Significant post-pandemic growth with a 16% rise in revenue per available room (revpar).
- A robust expansion with the opening of 275 hotels and a strategic pipeline of 556 new properties.
- A new $800 million share buyback scheme, boosting shareholder returns to over $1 billion.
In 2023, InterContinental Hotel Group (IHG) achieved a milestone with its profits surpassing $1 billion for the first time, marking a significant 23% increase driven by the strong performances of Holiday Inn, Crowne Plaza, and Iberostar. This remarkable growth is attributed to the post-pandemic recovery, with the key metric of revenue per available room (revpar) witnessing a 16% year-on-year increase. The lifting of COVID-19 travel restrictions played a crucial role in this upsurge, contributing to an elevated average daily rate, which rose by 5% from the previous year and 13% compared to 2019, alongside a 6% rise in occupancy.
The company’s expansion strategy saw the opening of 275 new hotels, adding nearly 48,000 rooms, culminating in a total of 6,363 properties worldwide. Furthermore, IHG’s strategic foresight is evident in its ambitious pipeline of 556 signed hotels, accounting for an additional 297,000 rooms across 2,016 global locations.
In a significant move for investors, IHG unveiled a new $800 million share buyback programme. Combined with ordinary dividends, this initiative is set to return over $1 billion to shareholders in 2024. Highlighting the broad recovery post-pandemic, IHG reported that by the fourth quarter of 2023, global revenue performance had surpassed 2019 levels across all types of stays—leisure, business, and group, with leisure leading at a 33% increase over 2019.
Technology and innovation continue to be at the forefront of IHG’s strategy, with mobile bookings now comprising 58% of all digital reservations. IHG CEO Elie Maalouf stated, “I was honoured to take over as IHG’s group CEO in July and would like to thank our teams for delivering an excellent set of results. Travel demand was strong across all markets, with revpar up 16% on last year and 11% ahead of the 2019 pre-pandemic peak.”
These developments underscore IHG’s commitment to growth and adaptation. The addition of 275 hotels in 2023 alone, with a record number of signings, illustrates the company’s capacity for expansion and resilience. Law firm Gowling WLG’s Philip Baker remarked on the sector’s resilience, highlighting the importance of consumer demand despite economic challenges.
Looking ahead, IHG’s strategic priorities aim to solidify its position as a preferred choice for guests and owners. Elie Maalouf emphasised the favourable long-term demand drivers within the travel industry and affirmed the strength of IHG’s brand portfolio in boosting revpar and system size growth.
IHG’s financial triumph in 2023 reflects strategic growth and innovation that set a robust foundation for future advancements.
