Revenue and pre-tax profits both up for InterContinental Hotels Group but company makes no mention of the rumours about a possible merger with Starwood.

InterContinental Hotels Group (IHG) has reported a rise in revenue and pre-tax profits in a week in which rumours have reignited about a merger with US company Starwood.
The British hotelier made no reference to Starwood in its half-year results on Thursday morning, but speculation about the tie-up continued, with IHG’s stock rising 1.4pc to £26.23 on Wednesday.
Hopes of a deal have been circling for months, with Starwood chairman Bruce Duncan saying in April that “no option is off the table” in its strategic review.
But IHG chief executive Richard Solomons refused to comment on the rumours.
Mr Solomons told the Telegraph: “We never comment on speculation. There’s been speculation around us, around the industry for many years and we never speculate on it.”
IHG, which owns the Holiday Inn brand, has moved to an asset-light model, selling InterContinental Paris – Le Grand in May for €330m, and recently announcing an agreement to sell InterContinental Hong Kong for $938m.
Mr Solomon said that the asset disposal programme, which “realised gross proceeds of $8bn”, would not affect prospects of a merger.
“I don’t think that has any bearing on it. I think it’s the way the industry is going. We have been ahead of the game.”
The FTSE 100 company announced revenue up 1pc to $915m and operating profit up 9pc to $337m.
Pre-tax profits stood at $458m for the six months ending June 30, up 21.5pc from the same point last year. Dividends are set to rise 10pc.

IHG has recently acquired boutique hotels business Kimpton and expects 2015 to be the best year for openings and signings in the brand’s history. The first-half has already seen the best signings figures, a key indicator of performance, since 2008.
“Boutique hotels are the fastest growing segment in the industry right now,” Mr Solomons said.
He said Kimpton, a luxury brand, would not compete directly with IHG’s other boutique offering, Hotel Indigo.
The British-based company now owns more than 4,900 hotels and 724,000 guest rooms in nearly 100 countries.
Mr Solomons said the company was “confident in the outlook for the rest of the year”.
“Our preferred brands demonstrated their continued momentum as we signed the highest number of Holiday Inn rooms ever in the first-half, including the two largest properties for the brand, and strengthened our leadership position in the fast-growing boutique segment,” he added.
“Alongside this we continue to make great progress delivering against our technology objectives, introducing a number of new digital initiatives that have helped drive almost 50pc growth in mobile revenue.”
IHG is working with Amadeus to develop the industry’s first cloud-based booking system.
Mr Solomons said digital developments could help make the “guest journey better” by “enabling you to interact with a company the way you want to do it”.
“Amadeus are the world leaders in reservation technology. They work with over 100 airlines and they have been talking for some time about moving into hospitality.”
IHG will be developing technology such as mobile check-in to improve guest experience.
“For a guest checking into one of our resorts in Bali or the Maldives or Phuket they want to be met and greeted, but if you’re spending six hours at a Holiday Inn Express in an airport, they may want mobile check-in,” Mr Solomons said.
Analyst Anna Barnfather of Panmure Gordon said it was a “strong set of interim results”.
She said: “Recent announcements on asset sales provide scope for $1bn cash return to shareholders in 2016. In the meantime pipeline is building and company is stepping up IT/digital spend.”

Source: http://www.telegraph.co.uk/finance/newsbysector/epic/ihg/11772842/Intercontinental-Hotels-ignores-Starwood-merger-rumours-as-profits-rise.html