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IHG to slash jobs as it posts US$275M loss

InterContinental Hotels will cut staff by 10% at the corporate level, after revenue dropped more than 50% and profit dropped 82% in the first half of 2020.

“The impact of COVID-19 on our business has been substantial,” company CEO Keith Barr said in a statement Tuesday.

Overall, global RevPAR declined by 52% in the first half and was down 75% in the second quarter, when occupancy at comparable hotels fell to 25%. In line with other major hotel companies, IHG’s revenue fell 52% to US$488 million and adjusted operating profit was US$74 million, down from US$410 million the year before.

Small but steady improvements in occupancy and RevPAR through the second quarter continued into July, with an expected RevPAR decline of 58% and occupancy rising to around 45%. Read the results here

Job cuts for IHG, whose other brands include the Crowne Plaza, Regent and Hualuxe hotel chains, will affect 650 individuals at its main offices, with more expected at its hotels around the world, according to reporting from FR24 News.

That reporting also showed IHG said 95% of its hotels are now open and some of its resorts in China sold out this month. Its 3,500 economy hotels in the U.S. operate with occupancy rates above 50%, higher than the current industry average.

Despite the job cuts and revenue loss, IHG said it did observe “small but steady” improvements in RevPAR, with July RevPAR only down 58% after an almost 75% decline in the second quarter.

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