HOTELS giant InterContinental Hotels Group is cutting costs after seeing revenues and profits fall 19% and 33%, respectively, in the third quarter of trading.

The chain, which includes Liverpool’s two Crowne Plaza hotels, a Holiday Inn, Holiday Inn Express, business-oriented Staybridge Suites and plans for a new ‘cool’ £14m 151-room Indigo hotel in Chapel Street for 2011, said that trading remains “challenging” in its update today.

Revenues fell to £240m and pre-tax profits, after exceptional costs, dropped from £120m to £80m in the three months to September 30.

Chief executive Andrew Cosslett said current trading is difficult but added that there are signs of hotel occupancy stabilising.

Last month the group’s European, Middle East and Africa president Kirk Kinsell said he had seen signs of stability in the corporate travel sector at the Staybridge site on Kings Dock.

However, the group warned today that there is still scarcity of finance for hotel developments.

And while the relaunch of the core Holiday Inn brand continues, with 1,378 hotels now operating under the new standards, the group says cost controls are still vital.

Today’s update confirmed the group is on target for cost savings of around £48m by the end of the current financial year, of which at least £24m will be “sustainable savings.”

By the end of 2011 it hopes to make up to £42m of sustainable savings.