Investors are checking into
mid-scale business model, sending shares of the company rising. Despite tumbling revenue per available room and reduced spending, the stock was up 5% to $10.36 in morning trading.
With the relaunch of Holiday Inn during the quarter, InterContinental is boosting its value message, which CFO Richard Solomons says makes the company more resilient during difficult times.
During the quarter profit dropped to $27 million from $62 million the year prior.
Revenue per available room, a key gauge of the hotel sector, tumbled 14%. This number is slightly better than the industry average and the company did say that is saw some signs of occupancy levels stabilizing during the quarter, but the window of visibility for future bookings is small, Solomons said.
InterContinental previously forecast a $30 million cut in costs, but said actual savings will be around $70 million.
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