Intercontinental buoyed by strong demand

Holiday Inn operator InterContinental Hotels today said strong demand was driving up room rates as it posted a 17% rise in underlying profits.

The Windsor-based group said revenues per available room had increased by 7% in the first half of of 2007 and described the outlook for the rest of the year as “positive”.

Chief executive Andrew Cosslett said: “Strong demand with relatively low levels of new supply is driving up room rates and our brands continue to outperform the market in most of our major regions and geographies.”

Underlying operating profits rose 17% to £111m (€164m) on a constant currency basis, although the company suffered from the weaker US dollar.

The company has set a target of adding between 50,000 and 60,000 new rooms by the end of 2008 and is confident of exceeding the goal after adding nearly 55,000 rooms to its development pipeline in the first half.