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IHG has acquired Ruby Hotels for initial purchase consideration of €110.5m (£91.77m) as it recorded a 10% increase in operating profits to $1.12bn (£888.1m) for the year ended 31 December 2024.
The group, which has 355 hotels in the UK, also reported a 7% increase in revenues to $2.31bn (£1.83bn).
Meanwhile, its global revenue per available room also increased 3% during the period. EMEAA recorded the strongest RevPAR growth, rising 6.6% for the full year and 6.9% in Q4, outpacing the Americas (+2.5%, Q4 +4.6%) and Greater China (-4.8%, Q4 -2.8%).
Additionally, average daily rate was up 2.1% and occupancy was up 0.6%pts.
The group stated that strong demand globally from hotel owners and developers for its brands drove the opening of 371 hotels and the signing of 714 properties into its pipeline, equivalent to almost two a day. IHG’s global estate now stands at over 6,600 hotels.
Premium urban lifestyle hotel brand Ruby was established in 2013 and currently operates 20 hotels (3,483 rooms) in major cities across Europe and has another 10 pipeline hotels (2,235 rooms).
The pipeline hotels are set to open over the next three years across more European cities including Edinburgh, Marseille, Rome and Stockholm.
The seller of the brand anticipates growing the portfolio of Ruby-branded hotels substantially further, and IHG expects to grow the brand with other hotel owners in Europe and globally.
IHG is targeting the Ruby brand to grow to more than 120 hotels over the next 10 years and accelerate to more than 250 over 20 years.
Elie Maalouf, chief executive officer, IHG Hotels and Resorts, said: “Thanks to the hard work and dedication of our teams around the world, 2024 was an excellent year of financial performance, strong growth and important progress against a clear strategy that is unlocking the full potential of our business for all stakeholders.
“RevPAR growth accelerated in Q4, reflecting the breadth of our global footprint and improvements in all three regions. Together with strong system growth, notable margin expansion and the benefit of returning surplus capital through buybacks, we’re pleased to report adjusted EPS growth for the year of +15%.”
Maalouf added: “We are delighted with the acquisition of Ruby, which further enriches our portfolio with an exciting, distinct and high- quality offer for both guests and owners in popular city destinations. This acquisition demonstrates our focus on building our presence in large, attractive industry segments and using our experience of integrating and growing brands and hotel portfolios. The urban micro space is a franchise-friendly model with attractive owner economics, and we see excellent opportunities to not only expand Ruby’s strong European base but also rapidly take this exciting brand to the Americas and across Asia, as we have successfully done with previous brand acquisitions.”
Michael Struck, founder and CEO of The Ruby Group, said: “We have carefully selected IHG as the right partner to take the Ruby brand and our international expansion to the next level. IHG’s distribution powerhouse, the fact that Ruby perfectly complements IHG’s portfolio, and its proven track record of successfully preserving identity and culture when integrating brands gives us great confidence as we embark on this next chapter together.
“Combining the global reach and resources of IHG with the efficiency advantages of our operational and construction model will drive superior returns for our investors and real-estate partners, alike. Also, the timing could not be better. Our unique solutions for efficient adaptive re-use of office space are in high demand, positioning us for strong growth.”
