Hotels group Hilton said it had pegged back capital expenditure for next year after little sign of an upturn in trading conditions.

The company intends to spend £130 million on projects in its hotels division next year compared to £200 million this year.

Hilton, which has a hotel at Gatwick and the West Pier and Metropole hotels in Brighton, said the quality of its estate meant the figure would still be sufficient to ensure its portfolio stayed in good shape.

The budget would also be enough to cover the £46 million being spent on the redevelopment of the Hilton Sydney.

The company's budget review comes after figures for the four months to October 31 showed profits were nine per cent lower than a year ago.

That compares with a ten per cent fall in half-year profits reported in August.

Hilton said political and economic uncertainties had resulted in widely varying performances in different parts of the world, with hotels in key European cities among those affected.

It said: "The timing of a sustained recovery in the hotels business remains difficult to predict."

The trading figures for September and October showed Hilton's UK hotels division improved its revenues per average room figure by 4.6 per cent, although the figure benefits from weaker comparisons last year because of September 11.

In the company's five-star London hotels, the increase was 10.5 per cent after a 12.9 per cent decline in July and August, while four-star properties rose 6.5 per cent after a dip of 7.5 per cent in the previous period.

A Hilton spokesman said its London hotels had benefited from aggressive marketing to attract customers on weekend and leisure-based breaks.