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But business deteriorates in fourth quarter
InterContinental Hotels Group (IHG) reported a total operating profit for 2008 of $549m in its preliminary figures released today (February 17).
The figures show a 12% rise in its operating profit for 2007 of $491m.
The group, whose brands include InterContinental, Crowne Plaza and Holiday Inn, said its revenue for the 12 months to December 31 was $1,854m, compared to $1,771m in2007, an increase of 5%.
During the year IHG said its room count had increased by 34,757 to a total of 619,851 rooms (4,186 hotels), a rise of 6%.
A further 98,886 rooms were signed for during 2008, including 25,058 in the last quarter.
In the 12 months, IHG said revPAR (revenue per available room) had risen by 0.9%.
But the group said there was a "sharp deterioration" in the fourth quarter with revPAR falling by 6.5% across the globe.
IHG said forward bookings for 2009 show "no sign of improvement in levels of demand."
IHG said the EMEA region had returned a 28% increase in operating profit from $134m in 2007 to $171m last year.
RevPAR increased in the region by 3.6%, driven by a strong performance in the Middle East where it rose by 20.2%.
But the drop in trade in the last quarter saw revPAR in the EMEA region drop by 5.6%.
Andrew Cosslett, IHG's ceo, described the 2008 preliminary results as "good" with the target of adding up to 60,000 rooms in the three years to the end of 2008 exceeded with 82,000 rooms being added.
He said the $1bn re-launch of Holiday Inn was also "progressing well."
But he added: "The trading environment is very tough. The sharp deterioration that we reported on last November has continued into 2009 and we see no signs of improvement at this stage.
"It has been clear for some time that 2009 will be a challenging year and we have taken action to prepare the business, including strict management of cash and a significant reduction in costs."