Half Year 2024 InterContinental Hotels Group PLC Earnings Call Transcript
Key Points
- InterContinental Hotels Group PLC (IHG) reported a strong financial performance in the first half of 2024, with operating profit up 12% and EPS growth of 12%.
- The company achieved record-breaking signings of over 57,000 rooms, a 67% increase from the previous year, driven by strong momentum across its brand portfolio.
- IHG's fee margin expanded by 180 basis points, contributing to a robust operating profit of over $0.5 billion.
- The company declared an interim dividend of $0.532, consistent with a 10% growth rate over the past two years, and expects to return over $1 billion to shareholders in 2024.
- IHG's global RevPAR improved by 3.2% in Q2, with strong performance in the Americas and EMEAA regions, indicating a positive rebound in key markets.
- RevPAR in Greater China decreased by 7% in Q2, reflecting tougher year-over-year comparisons and challenges in the domestic market.
- The company's free cash flow conversion is expected to be lower than the typical 100% due to the spending down of the system fund surplus.
- IHG's interest costs have increased due to higher net debt levels and refinancing activities, impacting overall financial expenses.
- The effective tax rate increased to 27%, up from 25% in the first half of 2023, due to the absence of a non-recurring deferred tax credit.
- US signings showed a mix shift to smaller key counts, and some brands like Holiday Inn Express experienced a decline in signings compared to the previous year.
Hello, and welcome to IHG's 2024 half-year results presentation. I'm Stuart Ford, Senior Vice President and Head of Investor Relations at IHG Hotels & Resorts. After a short video reel, I will pass over to Ellie Maalouf, our Chief Executive Officer.
Before we proceed, I'm obliged to remind the audience that the company may make certain forward-looking statements as defined under US law. Please refer to the accompanying half-year results announcement and the company's SEC filings for factors that could lead actual results to differ materially from those expressed in or implied by any such forward-looking statements.
The results release, together with the usual supplementary data pack as well as the presentation slides accompanying the results can all be downloaded from the results and presentations section under the investors tab on ihgplc.com.
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