InterContinental Hotels Shares Gain On 1Q Results

"Occupancy showed signs of stabilization in the quarter, but room rates, which held up well during 2008, declined under the pressure of a very competitive market," said Chief Executive Andrew Cosslett in a statement.

InterContinental noted that it remains committed to completing its revamp of its Holiday Inn brand by the end of 2010. The company said conversions — which include redesigned lobbies and guest rooms — have been slower than planned due to tough market conditions, but that 700 hotels have already relaunched.

The company also noted that hotels that have completed the relaunch process are seeing better revenue per available room results than properties that have not gone through the renovations.

"It is taking longer. It is tougher," Cosslett said. "We expect to lose a few more on the way than we originally planned. But in the context of our overall pipeline ... we believe we can absorb that. And the key thing for us is to get the job finished."