InterContinental Hotels, the world's biggest hotelier, has seen a worldwide downturn in bookings accelerate sharply since the start of the year.

Revenues per available room, the hoteliers' preferred measure of success, fell 6.5% in the final quarter of 2008 but were down 12.2% in January. Chief executive Andy Cosslett said: "All you can do in this situation is outperform your rivals and stand by your partners in the hotel system."

IHG owns only 16 hotels but manages well over 4000 under the InterContinental, Holiday Inn, Crowne Plaza and Indigo brands. Cosslett said the recession was benefiting Holiday Inn most. "It's the luxury hotels which are suffering most as business travellers are downgrading. The leisure market is holding up slightly, and obviously people are being offered some pretty good deals in that are," he said.

One exception to the luxury market downturn has been the InterContinental on Park Lane. It reopened just under two years ago after a huge makeover and has since been rebuilding its reputation. It last year benefited from chef Theo Randall winning London's Italian Restaurant of the Year award, and from the closure for refurbishment of The Savoy and Four Seasons.

Cosslett said it was impossible to predict when the downturn would end: "January is always the smallest month, so it is not a great indicator. Things seem to have started to steady a bit in February but visibility is very low - 2009 was always going to be tough and we have taken action to prepare for it."

At the end of last year and early this, IHG cut 120 jobs, many of them at fairly senior management levels to help save costs of $30 million (£21 million) a year. Cosslett also argues that his strategy of not owning hotels, or being "asset light" as he calls it, is best suited to current conditions.

He still expects to add 400 or more hotel management contracts this year, compared with 430 in 2008, as owners who are halfway through building hotels rush to start earning cash.

Headline operating profits rose 12% to $549 million on revenues up 5% at $1.85 billion in 2008. The first-half dividend was raised by 6% but the final is unchanged, making a payout for the year of 41.4 cents.