Millennium & Copthorne's hotels in Birmingham and Merry Hill contributed to a seven-per-cent increase in revenues from UK regional operations in the three months to September 30.
The increase more than offset a five-per-cent fall in revenues at the group's London hotels after the July 7 terrorist attacks on the capital that killed 52 people.
Overall, the M&C was able to report a 27-per-cent rise in third-quarter earnings yesterday as demand in the US and Asia offset a drop in tourism to London.
The firm said revenue per available room (RevPAR), a key industry measure, grew by 4.6 per cent in the quarter.
M&C said: "Our regional UK portfolio continued to perform well with a 7.2 per cent increase in RevPAR."
Chief executive Tony Potter said: "The general weekend leisure business in London as an isolated segment of our business is not yet back to normal, but it is returning."
He added that the firm's London hotels had seen a strong pick-up in corporate sales.
M&C, which operates more than 90 hotels in 17 countries, said RevPAR rose by 3.4 per cent in the four weeks to October 28.
"Given uncertainty in the global economic and travel environment, the outlook for growth in 2006 is unclear," it said in a statement.
Pretax profit surged 52 per cent to £20 million on revenues eight per cent up at £146.6 million.
The profit figure excludes a one-off gain of £3.3 million from the sale of the company's Bayswater Tower hotel in Sydney.
M&C, which is just over 50-per-cent owned by Singapore's City Developments, said strong RevPAR growth in its three New York hotels was held back by a weaker performance elsewhere in the United States.
RevPAR in Asia was up 7.5 per cent in the third quarter.
"There is further room for price increases across Asia and in New York. The booking pace on conventions and meetings is very strong and in Asia we see price opportunities continuing particularly in Singapore," Mr Potter said.
Chairman Kwek Leng Beng said of the figures: "In the third quarter, the US, New York in particular, and Asia continued to achieve strong growth, benefiting from an improved trading environment.
"An otherwise solid UK performance was tempered by weakness in London following the incidents in July. Looking forward, we continue to be encouraged by the on-going performance of our New York and Asian properties.
"Our management team continues to focus on making
further operational improvements to drive the performance of our hotels.
"With our group's geographically diversified portfolio and focus on prudent cost management, we are well positioned for the final quarter. However, given uncertainty in the global economic and travel environment, the outlook is less clear."
M&C also announced yesterday that two of its hotels, in California and Singapore are to be converted into residential apartments.
Shares closed up 8.25p at 378.25p.