InterContinental Hotels Group PLC (LON:IHG) hiked its dividend 10% as profits improved last year even though revenue per room worsened each quarter.
The Holiday Inn and Crown Plaza owner revealed full-year revenue per available room (revpar) was down 0.3%, with the US down 0.2% and Greater China down 4.5%, while Europe Middle East Africa and the rest of Asia progressed 0.3%.
Led by a 10.5% decline across Greater China, global revpar dropped 1.8% in the fourth quarter, having fallen 0.8% in the third and 0.2% in the second, after a heady 0.3% gain in the first.
Of the declining revpar, IHG said: “Performance was impacted by macro and geopolitical factors, increased supply growth ahead of demand in some markets, and ongoing unrest in Hong Kong”.
But total revenue rose 8% to US$2.08bn, with operating profit up 4% to US$865mln. Net debt was up 36% to US$2.7bn.
The board increased the dividend to 125.8 US cents from 114.4 a year ago, with chief executive Keith Barr saying it remained “committed to returning surplus cash to our shareholders”.
He said investments in the business, including 5.6% growth of the room system as around 65,000 rooms were added and 18,000 removed, were being funded by an efficiency programme that was on track to deliver US$125m of annual savings, “with the majority already realised and being reinvested across the business”.
On the market's current big worry, he added: "Given the ongoing impact of coronavirus following the outbreak in China, our top priority remains the health and safety of our colleagues, guests and our partners on the ground".
Analysts at Peel Hunt noted: "As is usual for IHG, there is little forward-looking in the statement."
IHG shares fell 2% in early trading but by mid-morning were almost back to parity for the day at 4,824p.