By Anthony O. Goriainoff
InterContinental Hotels Group is scheduled to report results for the first half on Tuesday. Here’s what you need to know:
NET PROFIT FORECAST: Net profit consensus for the London-listed hotel chain stands at $292 million, UBS analyst Jarrod Castle says in a note. The company reported net profit of $216 million in the year-prior period.
REVENUE FORECAST: The company is expected to report revenue of $2.1 billion for the period, compared with revenue consensus of $2.2 billion, Castle says, and reported revenue for the first half of 2022 of $1.79 billion.
UNDERLYING EARNINGS FORECAST: Underlying earnings before interest and taxes–which strips out exceptional and other one-off items–consensus for the period stands at $470 million, compared with Jefferies’ estimate of $466 million, Jefferies analysts say in a note.
WHAT TO WATCH:
-NET UNIT GROWTH: Given the supply challenges in the U.S. the risk to NUG in 2023 is low, Jefferies says. NUG consensus for IHG has stayed set at over 4.1% growth and in line with Jefferies’ estimates. Analysts at Jefferies also see its NUG for 2023 as more resilient than that of peer Hilton as InterContinental benefits from onboarding Iberostar, which shouldn’t be hurt by construction and lending conditions and because of its lower U.S. exposure, 36% of its pipeline, as opposed to Hilton’s 42%.
-REVPAR: Revenue per available room–a key metric for the industry–growth consensus for the second quarter is over 15.6% year on year, versus Jefferies estimates of over 15.5%. “We believe 2Q momentum in the Americas and China has remained in-line with 1Q, while EMEAA [Europe, Middle East, Africa and Asia] has improved,” Jefferies says.
-STRATEGY: As these will be the first results under new CEO Elie Maalouf an update on strategy will likely be provided, Castle says.
Write to Anthony O. Goriainoff at anthony.orunagoriainoff@dowjones.com
