InterContinental Hotels (IHG) (IHG) said its net profit jumped to 162 million pounds ($310 million) from 50 million pounds a year ago. The profit included a net gain of 115 million pounds on the sale of several hotels.
Profit from continuing operations rose 13% to 53 million pounds, broadly in line with analyst expectations.
Revenue dropped 47.8% to 237 million pounds due to the sale of several hotels and the company's stake in soft-drinks maker Britvic (BVIC) over the last year.
Shares in the firm rose 1.9% in London.
Over the last several years, InterContinental, which operates hotels under the InterContinental, Holiday Inn and Crowne Plaza brands has undergone a major restructuring, selling off assets and becoming mainly a hotel manager.
Chief Executive Andrew Cosslett said the outlook for the firm remains positive, with continued growth in its new hotels pipeline, and added it remains on track to add 10,000 new rooms in the year.
InterContinental is planning to add 50,000 to 60,000 net room additions by the end of 2008 -- a target that Cosslett said in August will require the firm to open one hotel every day until the end of 2008.
The firm, which has returned around 2.75 billion pounds to shareholders since April 2003, reiterated that it will announce a further share buyback by February at the latest.
Cosslett said the next cash return to shareholders will be the last major step following InterContinental's restructure and it wants to take its time and analyze all the data on growth and costs before making a final decision.
"There's just a huge amount of data in the business at the moment that's being assimilated and absorbed," Cosslett said on a conference call with analysts. "It would be wrong of us to predict that too early and go off half-cocked," he added.
Anna Barnfather, an analyst at Jefferies International, said the next buyback could be for as much as 800 million pounds.
InterContinental said revenue per available room increased across all its divisions, particularly in Europe, the Middle East and Asia, where it grew 11.6%.
Barnfather said the firm has shown a good recovery in London, where trading was hurt a year ago by the terrorist bomb attacks.
On the downside, however, a delay in reopening all the rooms in the recently refurbished InterContinental London Park Lane means the hotel's profitability will likely fall by around 18 million pounds from 2004, compared to a previous forecast of a 15 million pound drop.
The standout region was the Middle East, where revenue per available room rose 30%.
Cosslett told analyst this growth was driven by the performance of its top-end InterContinental hotels, with strong inter-regional, tourist and business traffic all contributing.
"We've got more InterContinentals per head there than anywhere else in the world," he noted.
In the U.S., where InterContinental Hotels derives the majority of its profit, revenue per available room rose 7.5%, driven by an increase in the rates the firm charges.
Operating profit for the region rose 17% to $108 million due to strong growth from its hotel management unit, which benefited from retaining management contracts on hotels that the company has sold.