The impact of COVID-19 on InterContinental Hotels Group: Case Study

The impact of COVID-19 on InterContinental Hotels Group: Case Study



Summary



Recent months have been unprecedented in the tourism sector. Travel restrictions, flight suspensions, falling consumer confidence and a slew of negative press are just some of the issues lodging operators are having to contend with. As one of the resorts industry’s largest players, IHG has been severely impacted.



Key Highlights



– The hotel industry has been hit catastrophically with hotels being closed and global travel coming to a halt, upending global travel. Despite IHG only having approximately 15% of its estate closed at the end of April, the financial results showed the impact this had. Q1 showed global RevPAR was down 24.9% with March being the worst month as RevPAR plunged 55%. April was worse with RevPAR down around 80%.

– IHG has a greater exposure to China compared to competitors such as Hilton and felt the impact of the pandemic earlier. The hotel group stated that it could only survive 18 months with no capacity in its hotels. In China, only 12 of IHG’s hotels are closed out of the 470 hotels, showing the situation is improving.

– IHG has secured new financing arrangements, which include amending its syndicated revolving credit facility to include a waiver of existing covenants until 31 December 2021. Additionally, the Bank of England confirmed IHG as an eligible issuer for the UK Government’s CCFF and IHG has issued $600m (US$745.2m) in commercial paper under this facility.



Scope



– This case study looks at how the COVID-19 pandemic is impacting IHG and assesses the company’s response.



Reasons to Buy



– Gain an overview of the current global COVID-19 situation

– Understand the impact that COVID-19 is having on the lodging industry

– Assess the impact on IHG

– Understand what the future may hold for the company



Companies Mentioned:

InterContinental Hotels Group (IHG)

Hilton

Wyndham Hotels & Resorts

Hyatt

Ritesh Tiwari is the Founder of Research By Markets. He has more than 7 years experience in the Market Research industry and a total experience spanning 18+ years. His core experience is in Sales and International Recruitments. Ritesh is a big foodie and a huge football fan, supporting Manchester United (EPL) and FC Barcelona (La Liga). He hardly misses watching any matches when these teams are playing. Get in touch with Ritesh via: enquiry@researchbymarkets.com *Industry Press Release is a part of Research By Markets.