IHG, Whitbread (WTB) & PPHE: Should you hold these hospitality stocks?

December 01, 2021 08:26 AM GMT | By Nidhi Gupta
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Highlights 

  • For Q3 2021, InterContinental Hotels Group achieved an average daily rate in line with 2019 levels and occupancy of approximately 60%.
  • In H1 FY22, Whitbread benefitted from £141.6 million received from the government in the form of COVID-19 support schemes.
  • In November, PPHE Hotel Group, through its wholly owned subsidiary Londra Cargill Parent S.r.l, completed the takeover of the 4-star Londra & Cargill Hotel in Rome. 

Top executives from the UK’s hospitality sector have warned a huge impact on the hospitality business after messages from health officials started coming to limit socialising amid the growing spread of the Omicron Covid-19 variant. The Head of the Health Security Agency requested people to avoid socialising to curb the spread of the new strain.

UKHospitality has already reported booking cancellations and plan changes by customers on the back of growing concerns related to the spread of the new Omicron variant. The new health warning is expected to be a huge blow for hospitality sector players ahead of the key Christmas period. Below is the review of investment opportunities in 3 hospitality sector stocks - InterContinental Hotels Group, Whitbread and PPHE Hotel Group Limited amid the changing circumstances.

IHG, Whitbread (WTB) & PPHE: Market cap details

(Data source: Refinitiv)

InterContinental Hotels Group Plc (LON: IHG)

InterContinental Hotels Group is an FTSE 100 listed international hospitality firm. Recently, the company announced the launch of the Holiday Inn Express brand in Japan at the Osaka City Centre Midosuji in December 2021. It reported the opening of 79 hotels in Q3 and adding another 91 to the company’s pipeline of 1,800 properties.

For Q3 2021, InterContinental Hotels Group achieved an average daily rate in line with 2019 levels and occupancy of approximately 60%. The company’s gross system growth stood at 5.2% year-on-year, along with the opening of 12.3k rooms (across 79 hotels) in Q3.

The shares of Intercontinental Hotels Group closed at GBX 4,449.00, down by 3.28% on 30 November 2021. The market cap of the company stands at £8,427.95 million.

Whitbread Plc (LON: WTB)

Whitbread is a hospitality and restaurant business based in the UK. The company owns the Premier Inn, one of the UK's largest hotel brands. The company’s statutory revenues for H1 FY22 were down by 39.0% compared to H1 FY20 (pre-pandemic) due to COVID-19 restrictions.

Whitbread’s adjusted loss before tax stood at £56.6 million in H1 FY22 that benefitted from £141.6 million received from the government in the form of COVID-19 support schemes. Its statutory loss before tax was £19.3 million during the period. Its statutory revenue stood at £661.6 million in H1 FY22 compared to £1,084.0 million in H1 FY20.

The shares of Whitbread closed at GBX 2,803.00, down by 2.50% on 30 November 2021. The market cap of the company stands at £5,807.43 million.

PPHE Hotel Group Limited (LON: PPH)

PPHE Hotel Group is an international hospitality real estate company that owns, develops and operates resorts and hotels. In November, PPHE Hotel Group, through its wholly-owned subsidiary Londra Cargill Parent S.r.l, completed the takeover of the 4-star Londra & Cargill Hotel in Rome. 

For the quarter ended 30 September 2021, PPHE Hotel Group’s total revenue stood at £75.7 million, representing an increase of 142.2% year-on-year, propelled by high leisure demand and increasing average room rates. Its occupancy rate stood at 54.3% for the three months ended 30 September 2021 compared to 29.8% in the previous year’s comparable period.

The shares of PPHE Hotel Group Limited closed at GBX 1,380.00, up by 2.07% on 30 November 2021. The market cap of the company stands at £575.13 million.


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