(Alliance News) - InterContinental Hotels Group PLC on Friday reported progress in a key revenue metric, boosted by the Europe, the Middle East, Asia & Africa region, and said it would benefit from changes to its system fund.

Shares in IHG fell 1.2% to 7,790.00 pence in London on Friday morning.

The Berkshire, England-based hotel operator said first quarter revenue per available room rose 2.6% on-year. It noted an 8.9% rise in the Europe, the Middle East, Asia & Africa region, and a 2.5% rise in Greater China. In the Americas, revPAR fell 0.3%.

"The Americas, having already recovered very strongly, was broadly flat due to some adverse calendar timing," IHG said.

IHG said occupancy rose 0.2 percentage points in the quarter, during which it opened around 6,300 rooms in 46 hotels.

Chief Executive Elie Maalouf highlighted an "impressive" performance in the EMEAA region and said China will "continue to benefit" from returning international inbound travel this year.

She noted global occupancy moved up to 62% and average daily rate increased by a further 2% as "pricing remained robust, reflecting the complete return of leisure, business, and group travel."

IHG also announced changes to its system fund, that hotel owners pay into. Owners pay contributions into the fund, which include a marketing and reservation assessment and a loyalty assessment," it explained.

Following a review of owner charges, IHG said it is lowering its standard loyalty assessment fee that owners pay into the fund. It also announced to owners other marketing and loyalty programme benefits.

IHG noted the fund has received a growing stream of ancillary revenues such as those from the sale of IHG One Rewards loyalty points.

Historically, IHG has allowed the full revenue generated on the sale of loyalty points to be included in the system fund.

Going forward, a portion of the revenue from the sale of certain loyalty points, together with certain other ancillary revenues, will now be recognised by IHG within its results. Initially 50% of this will be recognised by IHG in 2024, which is estimated to deliver around USD25 million incrementally to revenue and operating profit.

This will annualise in 2025 when IHG will recognise 100%, it said.

By Jeremy Cutler, Alliance News reporter

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