99.1
|
Final Results | ||||
|
|
||||
Financial summary1
|
2013
|
20122
|
% Change YoY
|
||
Actual
|
CER4
|
Underlying5
|
|||
Revenue
|
$1,903m
|
$1,835m
|
4%
|
4%
|
4%
|
Fee revenue
|
$1,176m
|
$1,135m
|
4%
|
4%
|
-
|
Operating profit
|
$668m
|
$605m
|
10%
|
10%
|
8%
|
Adjusted basic EPS
|
158.3¢
|
139.0¢
|
14%
|
-
|
-
|
Basic EPS3
|
140.9¢
|
187.1¢
|
(25)%
|
-
|
-
|
Total dividend per share
|
70.0¢
|
64.0¢
|
9%
|
-
|
-
|
Net debt
|
$1,153m
|
$1,074m
|
-
|
-
|
-
|
Richard Solomons, Chief Executive of InterContinental Hotels Group PLC, said:
|
||||||||
"2013 marked IHG’s tenth anniversary as a standalone company, and was another year of strong performance. We delivered good underlying growth in revenues and profits, further reduced the capital intensity of the business and continued to generate high returns.
Over the last 12 months we entered into agreements to dispose of three owned InterContinental hotels, with total gross proceeds of almost $830m. This includes InterContinental Mark Hopkins, San Francisco which we have announced today. At the same time we are continuing to invest behind our award-winning brands and technology platforms to meet changing consumer behaviours and sustain our industry-leading position.
We opened 237 hotels and signed a further 444 hotels into our pipeline, the highest number for five years, thereby reinforcing our already strong brand distribution platform and with it the promise of further high quality growth.
Our decision to increase our ordinary dividend by 9% reflects our confidence in our proven strategy to deliver high quality growth. Our preferred portfolio of brands, brought to life by talented people and best in class delivery systems, will enable us to continue to drive out-performance in an industry which has compelling long term prospects. Looking into 2014, although economic conditions in some markets remain uncertain, forward bookings data is encouraging and we are confident that we will deliver another year of growth.”
|
||||||||
Delivering high quality, sustainable growth
|
||||||||
•
|
$21.6bn of total gross revenue from hotels in IHG’s system, up 2% (3% CER)
|
|||||||
•
|
Global comparable RevPAR growth of 3.8%, with rate up 1.8% and occupancy up 1.3%pts
|
|||||||
-
|
Americas 4.3% (US 4.2%); Europe 1.7%; AMEA 6.1%; Greater China 1.0%.
|
|||||||
-
|
Q4 global comparable RevPAR growth of 4.4%: Americas 4.0%; Europe 4.9%; AMEA 6.4%; Greater China 2.4%.
|
|||||||
•
|
System size of 687k rooms (4,697 hotels)
|
|||||||
-
|
Net growth of 1.6%, 2.3% excluding 17 hotel removals for which significant liquidated damages totalling $46m were received.
|
|||||||
-
-
|
35k rooms (237 hotels) opened6, 25k rooms removed (142 hotels). 20k room openings and 18k room removals for the Holiday Inn brand family reflects our continued commitment to improving the quality of our largest brand.
65k rooms (444 hotels) signed6, up 22% year on year.
|
|||||||
-
-
|
Pipeline of 180k rooms (1,120 hotels) with over 45% under construction.
5% global industry supply, 12% active industry pipeline; well positioned to deliver sustainable high quality growth.
|
|||||||
•
|
Building preferred brands
|
|||||||
-
-
|
Clear focus on the needs of target guests has driven increased guest satisfaction across each brand globally.
Good momentum for our new brands with 21 HUALUXE Hotels & Resorts and 5 EVEN Hotels in the pipeline. |
|||||||
-
|
IHG Rewards Club relaunch, including free internet for all members (an industry first), has driven a 10%pt increase in awareness of IHG as a brand family.
|
|||||||
•
|
Growing margins
|
|||||||
-
|
Group fee margin of 43.2%, up 1.3%pts2, with scale benefits and cost efficiencies more than offsetting increased investment for future growth. Continued focus on sustainable fee margin progression over the medium term.
|
|||||||
Capital Expenditure
|
||||||||
•
•
|
Growth capital expenditure of $129m includes our first three owned EVEN Hotels, and was more than funded by $444m net cash proceeds from disposals. Maintenance capital expenditure of $140m.
In 2014 we expect to remain at the top end of our previously guided $250m-350m capital expenditure range due to increased investment in brands and technology platforms. IHG’s 20% share of InterContinental New York Barclay’s c.$175m refurbishment cost will be in addition to this.
|
|||||||
Progress on asset disposals
|
||||||||
•
|
InterContinental London Park Lane disposal completed on 1 May with up to 60 year management contract.
|
|||||||
•
|
Disposal of 80% interest in InterContinental New York Barclay agreed with a c.$175m refurbishment, repositioning and extension of the hotel and up to 50 year management contract. Deal completion expected in Q1’14.
|
|||||||
•
|
InterContinental Mark Hopkins, San Francisco disposal announced today for gross cash proceeds of $120m.
|
|||||||
1 All figures are before exceptional items unless otherwise noted. 2 2012 restated for adoption of IAS 19R.
|
3 After exceptional items.
|
|||||||
4 CER =constant exchange rates.
|
5 At CER & excluding owned asset disposals, results from managed lease hotels & significant liquidated damages
|
|||||||
|
6 Openings & signings include 4k rooms on US Army bases in H1 2013
|
|||||||
See appendix 3 for financial headlines and appendix 5 for definitions
|
Americas – Good performance driven by solid RevPAR growth
|
Comparable RevPAR increased 4.3%, with 2.6% rate growth; fourth quarter RevPAR increased 4.0%. US RevPAR was up 4.2%, with 3.0% growth in the fourth quarter, despite weaker trading conditions in October during the US government shut down.
Reported revenue increased 9% (10% at CER) to $916m and operating profit increased 13% (13% at CER) to $550m. On an underlying5 basis, revenue and operating profit were both up 7%. This was driven predominantly by the franchise business where royalties were up 5% and fees associated with the initial franchising, relicensing and termination of hotels increased $6m. This was partly offset by an $8m decrease in fees received due to the hotels that exited in Q1 for which $31m of liquidated damages were received. Owned profits increased 25%, driven by RevPAR growth of 10.0% and 9.0% respectively at our InterContinental hotels in Boston and San Francisco.
We opened 20k6 rooms (173 hotels), including 12k rooms for the Holiday Inn brand family. Removals of 18k rooms (112 hotels) resulted from our on-going focus on high quality growth and included 2.5k rooms (8 hotels) related to the significant liquidated damages receipt in Q1. We signed 34k6 rooms (305 hotels) up 33% year on year. Signings included four hotels for the new EVEN Hotels brand, with the first of these due to open H1 2014, and 21k rooms for the Holiday Inn brand family.
2014:
In the first half of 2014 we expect to receive one $4m significant liquidated damages payment in our Americas franchise business. In 2013 the owned operating profit from the InterContinental New York Barclay was $14m and was $6m from InterContinental Mark Hopkins, San Francisco. The refurbishment of InterContinental New York Barclay is expected to have a $5m negative impact on Americas managed operating profit in 2014.
|
Europe – Solid growth led by priority markets
|
Comparable RevPAR increased 1.7% led by a 1.5%pt increase in occupancy. In the first nine months RevPAR grew 0.7%, then accelerated sharply in the fourth quarter to 4.9%. RevPAR growth was resilient in our priority markets, despite tough comparatives, with an increase of 3.0% in the UK and 0.8% in Germany. In France RevPAR grew 2.6%, with 5.3% growth at our owned InterContinental hotel in Paris.
Reported revenue decreased 8% (10% at CER) to $400m and operating profit decreased 6% (8% at CER) to $105m. On an underlying5 basis, revenue increased 3% and operating profit increased 10%, driven by a 7% increase in franchise royalty fees and a $3m property tax recovery at InterContinental Paris Le Grand.
Openings of 4k rooms (21 hotels) included two iconic InterContinental hotels, one in Marseille, France and the other in Davos, Switzerland. We also opened three new properties for the Hotel Indigo brand, in prime locations in Tel Aviv, Barcelona and Dusseldorf. We signed 8k rooms (50 hotels) of which seven hotels were in London, including InterContinental London The O2, our third hotel for the InterContinental brand in the city. We also signed seven hotels under multiple development agreements in Germany and Russia, covering several of our brands.
2014:
Our flagship owned InterContinental Paris Le Grand will commence an $8m refurbishment programme to enhance the historic Salon Opera ballroom and c.15% of the guest rooms; this is expected to have a $5m negative profit impact in 2014.
|
AMEA – Strong trading in key markets with increasing developing markets contribution
|
Comparable RevPAR increased 6.1%, with 6.4% growth in the fourth quarter. Strong trading in South East Asia and Japan led the performance with RevPAR up 9.9% and 9.6% respectively. Trading was solid in Australasia, up 4.5% and the Middle East, up 2.9%, despite geopolitical unrest continuing to impact our business in Egypt and Lebanon. An increasing mix of new rooms opening in developing markets means that total RevPAR grew 2.8%.
Reported revenue increased 6% (12% CER) to $230m and operating profit decreased 2% (increased 1% at CER) to $86m, including one $6m significant liquidated damages receipt in the second half. On an underlying5 basis, revenue was down 3% and operating profit down 8%. This reflects good underlying growth in our continuing managed business offset by a $10m fee reduction; $6m from long standing contracts renewed onto standard market terms, as previously disclosed, and $4m from some older hotels that we have removed from the system.
We opened 4k rooms (20 hotels) including five hotels in India and two hotels in Indonesia as well as our first InterContinental hotels in Osaka, Japan and Lagos, Nigeria, both flagships for the brand in those countries. We signed 9k rooms (36 hotels) in the region, 75% of which were for the Holiday Inn brand family and included a 1.2k room Holiday Inn in Makkah. We also signed an iconic InterContinental hotel in Sydney which is expected to open in the second half of 2014 following a comprehensive refurbishment.
2014:
Given the favourable long-term outlook in several of our markets in AMEA, there are a number of significant refurbishment programmes scheduled to take place in 2014 which we expect to have a $4m negative impact on IHG’s fee income in the year.
|
5 At CER and excluding: owned asset disposals, results from managed lease hotels and significant liquidated damages
|
6 Openings and signings both include 4k rooms on US Army bases in H1 2013.
|
Greater China – scale and premium position drove resilient performance despite challenging conditions
|
Comparable RevPAR increased 1.0% with 2.4% growth in the fourth quarter. IHG’s scale and strength in the region drove significant outperformance compared to the industry throughout 2013. This reflects the resilience of our business despite the ongoing industry-wide challenges, including the impact of the China-Japan territorial island dispute, natural disasters in some regions and the slower macroeconomic conditions. An increasing mix of new rooms openings in developing markets means that total RevPAR was down 1.3% in 2013.
Reported revenue increased 3% (3% CER) to $236m and operating profit was up 1% (2% CER) to $82m. Managed profit was flat at $51m, reflecting 12% net room growth offset by the challenging trading conditions and our increased investment to drive future growth. Operating profit at our owned InterContinental hotel in Hong Kong increased by 4% with strong profit conversion and an 11% increase in food & beverage profits, despite flat RevPAR growth principally due to reduced Japanese business.
We opened 8k rooms in the year in Greater China, taking our system size in the region up 11% to 69k rooms (208 hotels), our 8th consecutive year of double digit room growth. Almost 90% of our signings in the year were outside primary cities, reflecting the alignment of our development strategy to future industry growth drivers. Openings included six hotels each for our InterContinental and Crowne Plaza brands, and two for Hotel Indigo, including the first for the brand in Hong Kong. Almost half of our 15k room signings were for the Holiday Inn brand family. 2k rooms signed for HUALUXE Hotels & Resorts in the year taking the pipeline for this brand to 21 hotels (7k rooms).
|
Sources and uses of cash – strong free cash flow generation
|
||
•
|
Cash generation: Free cash flow of $502m up 11% year on year (2012: $454m). $444m net cash inflow from asset disposals.
|
|
•
|
Ordinary dividend: up 9% to 70 cents, 11% compound annual growth since 2003.
|
|
•
|
Good progress with return of funds to shareholders: $355m special dividend without share consolidation paid in October 2013. The $500m share buyback programme is 78% complete with 13.9m shares repurchased to date for $390m, with 9.8m shares repurchased during 2013 for $283m.
|
|
Interest, debt, tax, pension and exceptional items
|
||
•
|
Interest: 2013 charge of $73m (2012: $54m) reflects the increase in average net debt year on year, and the issuance of a £400m bond in November 2012.
|
|
•
|
Net debt: $1,153m at the end of the period (including the $215m finance lease on the InterContinental Boston). This is up $79m on the 2012 position of $1,074m as a result of the return of funds to shareholders in the year partly offset by the cash inflow from the disposal of the InterContinental London Park Lane.
|
|
•
|
Tax: Effective rate for 2013 is 29% (2012: 27%). 2014 tax rate expected to be in low 30s, as previously guided.
|
|
•
|
Pension: In August 2013 the trustees of IHG’s UK pension plan completed a buy-in of the Group’s UK funded defined benefit obligations with the insurer Rothesay Life as an initial step towards the full buy-out of the liabilities. As part of IHG’s wider strategy to de-risk the balance sheet, this move removes the need for any further cash contributions by IHG in respect of these obligations.
|
|
•
|
Exceptional operating items: Net exceptional credit before tax of $5m (2012: $4m net charge). This includes an exceptional accounting charge of $147m related to the UK pension plan buy-in and a net credit of $166m related to the gain on disposal of the InterContinental London Park Lane.
|
|
•
|
Adoption of IAS 19 (Revised) Employee Benefits: adoption of this new accounting policy from 1 January 2013 has resulted in an additional $9m charge to operating profit for 2012, as reflected in the restated 2012 accounts.
|
|
Appendix 1: RevPAR Movement Summary
|
||||||
Full Year 2013
|
Q4 2013
|
|||||
RevPAR
|
Rate
|
Occ.
|
RevPAR
|
Rate
|
Occ.
|
|
Group
|
3.8%
|
1.8%
|
1.3pts
|
4.4%
|
1.8%
|
1.6pts
|
Americas
|
4.3%
|
2.6%
|
1.1pts
|
4.0%
|
2.1%
|
1.1pts
|
Europe
|
1.7%
|
(0.4)%
|
1.5pts
|
4.9%
|
1.1%
|
2.5pts
|
AMEA
|
6.1%
|
3.0%
|
2.1pts
|
6.4%
|
3.9%
|
1.8pts
|
G. China
|
1.0%
|
(1.7)%
|
1.6pts
|
2.4%
|
(2.4)%
|
3.0pts
|
Appendix 2: Full Year System & Pipeline Summary (rooms)
|
|||||||
System
|
Pipeline
|
||||||
Openings
|
Removals
|
Net
|
Total
|
YoY%
|
Signings
|
Total
|
|
Group
|
35,467
|
(24,576)
|
10,891
|
686,873
|
1.6%
|
65,461
|
180,461
|
Americas
|
19,775
|
(17,968)
|
1,807
|
451,424
|
0.4%
|
33,884
|
76,018
|
Europe
|
3,528
|
(3,489)
|
39
|
102,066
|
0.0%
|
7,542
|
17,779
|
AMEA
|
4,495
|
(2,394)
|
2,101
|
64,838
|
3.3%
|
8,687
|
32,074
|
G. China
|
7,669
|
(725)
|
6,944
|
68,545
|
11.3%
|
15,348
|
54,590
|
Appendix 3: Full Year financial headlines
|
||||||||||||
Operating Profit $m
|
Total
|
Americas
|
Europe
|
AMEA
|
G. China
|
Central
|
||||||
2013
|
20121
|
2013
|
2012
|
2013
|
20121
|
2013
|
2012
|
2013
|
2012
|
2013
|
2012
|
|
Franchised
|
595
|
547
|
499
|
466
|
79
|
65
|
12
|
12
|
5
|
4
|
-
|
-
|
Managed
|
247
|
221
|
74
|
48
|
30
|
32
|
92
|
90
|
51
|
51
|
-
|
-
|
Owned & leased
|
111
|
125
|
30
|
24
|
30
|
50
|
4
|
6
|
47
|
45
|
-
|
-
|
Regional overheads
|
(130)
|
(126)
|
(53)
|
(52)
|
(34)
|
(35)
|
(22)
|
(20)
|
(21)
|
(19)
|
-
|
-
|
Profit pre central overheads
|
823
|
767
|
550
|
486
|
105
|
112
|
86
|
88
|
82
|
81
|
-
|
-
|
Central overheads
|
(155)
|
(162)
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
(155)
|
(162)
|
Group Operating profit
|
668
|
605
|
550
|
486
|
105
|
112
|
86
|
88
|
82
|
81
|
(155)
|
(162)
|
1 2012 restated for the adoption on IAS 19R
|
||||||||||||
Total***
|
Americas
|
Europe
|
AMEA
|
G. China
|
|||||||
Reported
|
Actual*
|
CER**
|
Actual*
|
CER**
|
Actual*
|
CER**
|
Actual*
|
CER**
|
Actual*
|
CER**
|
|
Growth/ (decline)
|
10%
|
10%
|
13%
|
13%
|
(6)%
|
(8)%
|
(2)%
|
1%
|
1%
|
2%
|
|
Underlying****
Growth/ (decline)
|
Total***
|
Americas
|
Europe
|
AMEA
|
G. China
|
||||||
8%
|
7%
|
10%
|
(8)%
|
2%
|
|||||||
Exchange rates:
|
GBP:USD
|
EUR:USD
|
* US dollar actual currency
|
||||||||
2013
|
0.64
|
0.75
|
** Translated at constant 2012 exchange rates
|
||||||||
2012
|
0.63
|
0.78
|
*** After central overheads
|
||||||||
**** At CER and excluding: owned asset disposals, results from managed lease hotels and significant liquidated damages (see below for definitions)
|
Appendix 5: Definitions
|
Total gross revenue: total room revenue from franchised hotels and total hotel revenue from managed, owned and leased hotels. It is not revenue attributable to IHG, as it is derived mainly from hotels owned by third parties. The metric is highlighted as an indicator of the scale and reach of IHG’s brands.
Owned asset disposals: InterContinental London was sold on 1 May 2013. It accounted for $89m revenue and $33m profit in 2012 and $22m revenue and $8m profit in 2013 as an owned hotel.
Significant liquidated damages: total $46m in 2013 ($31m Americas managed in Q1, $9m Europe franchised in Q2, $6m AMEA managed in Q4) and $3m 2012 (Americas managed in Q4).
Comparable RevPAR: Revenue per available room for hotels that have traded for a full 12 months in both years, reported at CER.
Total RevPAR: Revenue per available room including results from hotels that have opened or exited in either year, reported at CER.
Fee revenue: Group revenue excluding owned & leased hotels, managed leases and significant liquidated damages.
Fee margin: adjusted for owned and leased hotels, managed leases and significant liquidated damages receipts.
Managed lease hotels: properties structured for legal reasons as operating leases but with the same characteristics as management contracts
Americas: Revenue 2013 $34m; 2012 $34m; EBIT 2013 nil, 2012 nil. Europe: Revenue 2013 $89m; 2012 $80m; EBIT 2013 $2m, 2012 $2m. AMEA: Revenue 2013 $21m; 2012 nil; EBIT 2013 $1m, 2012 nil.
|
Appendix 6: Investor Information for 2013 final dividend
|
|||
Ex-dividend date:
|
19 March 2014
|
Record date:
|
21 March 2014
|
Payment date:
|
9 May 2014
|
Dividend payment:
|
Ordinary shares = 28.1 pence per share
|
ADRs = 47.0 cents per ADR
|
For further information, please contact:
|
|||
Investor Relations (Catherine Dolton; Isabel Green):
|
+44 (0)1895 512176
|
||
Media Relations (Yasmin Diamond; Zoe Bird):
|
+44 (0)1895 512008
|
||
Presentation for Analysts and Shareholders:
A presentation with Richard Solomons, Chief Executive Officer and Paul Edgecliffe-Johnson, Chief Financial Officer will commence at 9:30am UK time on 18 February at Bank of America Merrill Lynch Financial Centre, 2 King Edward Street, London, EC1A 1HQ. There will be an opportunity to ask questions. The presentation will conclude at approx. 10.30am.
There will be a live audio webcast of the results presentation on the web address www.ihg.com/prelims14. The archived webcast of the presentation is expected to be on this website later on the day of the results and will remain on it for the foreseeable future. There will also be a live dial-in facility:
|
|||
UK toll:
UK toll free:
US toll:
Passcode
|
+44 (0)20 3003 2666
0808 109 0700
+1 212 999 6659
Hotel
|
||
A replay of the conference call will also be available following the event – details are below.
|
|||
Replay
Pin
|
+44 (0)20 8196 1998
8855942
|
||
US conference call and Q&A:
There will also be a conference call, primarily for US investors and analysts, at 9.00am Eastern Standard Time on 18 February with Richard Solomons, Chief Executive Officer and Paul Edgecliffe-Johnson, Chief Financial Officer. There will be an opportunity to ask questions.
|
|||
UK toll:
US toll:
US toll free:
Passcode
|
+44 (0)20 3003 2666
+1 212 999 6659
+1 866 966 5335
Hotel
|
||
A replay of the conference call will also be available following the event – details are below.
|
|||
Replay
Pin
|
+44 (0)20 8196 1998
5245113
|
||
Website:
The full release and supplementary data will be available on our website from 7.00 am (London time) on 18 February. The web address is www.ihg.com/prelims14.
|
|||
Notes to Editors:
IHG (InterContinental Hotels Group) [LON:IHG, NYSE:IHG (ADRs)] is a global organisation with a broad portfolio of nine hotel brands, including InterContinental® Hotels & Resorts, Hotel Indigo®, Crowne Plaza® Hotels & Resorts, Holiday Inn® Hotels and Resorts, Holiday Inn Express®, Staybridge Suites®, Candlewood Suites®, EVEN™ Hotels and HUALUXE™ Hotels & Resorts.
IHG manages IHG® Rewards Club, the world’s first and largest hotel loyalty programme with over 77 million members worldwide. The programme was relaunched in July 2013, offering enhanced benefits for members including free internet across all hotels, globally.
IHG franchises, leases, manages or owns 4,700 hotels and 687,000 guest rooms in nearly 100 countries and territories. With more than 1,100 hotels in its development pipeline, IHG expects to recruit around 90,000 people into additional roles across its estate over the next few years.
InterContinental Hotels Group PLC is the Group’s holding company and is incorporated in Great Britain and registered in England and Wales.
Visit www.ihg.com for hotel information and reservations and www.ihgrewardsclub.com for more on IHG Rewards Club. For our latest news, visit: www.ihg.com/media, www.twitter.com/ihg, www.facebook.com/ihg or www.youtube.com/ihgplc.
|
|||
Cautionary note regarding forward-looking statements:
This announcement contains certain forward-looking statements as defined under US law (Section 21E of the Securities Exchange Act of 1934). These forward-looking statements can be identified by the fact that they do not relate to historical or current facts. Forward-looking statements often use words such as ‘anticipate’, ‘target’, ‘expect’, ‘estimate’, ‘intend’, ‘plan’, ‘goal’, ‘believe’ or other words of similar meaning. By their nature, forward-looking statements are inherently predictive, speculative and involve risk and uncertainty. There are a number of factors that could cause actual results and developments to differ materially from those expressed in or implied by, such forward-looking statements. Factors that could affect the business and the financial results are described in ‘Risk Factors’ in the InterContinental Hotels Group PLC Annual report on Form 20-F filed with the United States Securities and Exchange Commission.
|
12 months ended 31 December
|
||||
Group results
|
2013
|
20121
|
%
|
|
$m
|
$m
|
change
|
||
Revenue
|
||||
Americas
|
916
|
837
|
9.4
|
|
Europe
|
400
|
436
|
(8.3)
|
|
AMEA
|
230
|
218
|
5.5
|
|
Greater China
|
236
|
230
|
2.6
|
|
Central
|
121
|
114
|
6.1
|
|
____
|
____
|
_____
|
||
1,903
|
1,835
|
3.7
|
||
____
|
____
|
____
|
||
Operating profit
|
||||
Americas
|
550
|
486
|
13.2
|
|
Europe
|
105
|
112
|
(6.3)
|
|
AMEA
|
86
|
88
|
(2.3)
|
|
Greater China
|
82
|
81
|
1.2
|
|
Central
|
(155)
|
(162)
|
4.3
|
|
____
|
____
|
_____
|
||
Operating profit before exceptional items
|
668
|
605
|
10.4
|
|
Exceptional operating items
|
5
|
(4)
|
225.0
|
|
___
|
___
|
___
|
||
673
|
601
|
12.0
|
||
Net financial expenses
|
(73)
|
(54)
|
(35.2)
|
|
___
|
___
|
___
|
||
Profit before tax
|
600
|
547
|
9.7
|
|
___
|
___
|
___
|
||
Earnings per ordinary share
|
||||
Basic
|
140.9¢
|
187.1¢
|
(24.7)
|
|
Adjusted
|
158.3¢
|
139.0¢
|
13.9
|
|
Average US dollar to sterling exchange rate
|
$1 : £0.64
|
$1 : £0.63
|
1.6
|
12 months ended 31 December
|
|||
2013
|
2012
|
%
|
|
Global total gross revenue
|
$bn
|
$bn
|
change
|
InterContinental
|
4.5
|
4.5
|
-
|
Crowne Plaza
|
4.0
|
4.0
|
-
|
Holiday Inn
|
6.2
|
6.3
|
(1.6)
|
Holiday Inn Express
|
5.2
|
4.8
|
8.3
|
Staybridge Suites
|
0.6
|
0.6
|
-
|
Candlewood Suites
|
0.6
|
0.5
|
20.0
|
Hotel Indigo
|
0.2
|
0.2
|
-
|
Other brands
|
0.3
|
0.3
|
-
|
____
|
____
|
____
|
|
Total
|
21.6
|
21.2
|
1.9
|
____
|
____
|
____
|
Hotels
|
Rooms
|
||||
Global hotel and room count
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
178
|
8
|
60,103
|
2,789
|
|
Crowne Plaza
|
391
|
(1)
|
108,891
|
584
|
|
Holiday Inn*
|
1,216
|
(31)
|
224,577
|
(6,911)
|
|
Holiday Inn Express
|
2,258
|
66
|
214,597
|
8,966
|
|
Staybridge Suites
|
196
|
7
|
21,518
|
822
|
|
Candlewood Suites
|
312
|
13
|
29,778
|
1,103
|
|
Hotel Indigo
|
55
|
5
|
6,199
|
538
|
|
Other
|
91
|
28
|
21,210
|
3,000
|
|
____
|
____
|
______
|
_____
|
||
Total
|
4,697
|
95
|
686,873
|
10,891
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
3,977
|
43
|
502,187
|
1,395
|
|
Managed
|
711
|
53
|
180,724
|
9,726
|
|
Owned and leased
|
9
|
(1)
|
3,962
|
(230)
|
|
____
|
____
|
______
|
_____
|
||
Total
|
4,697
|
95
|
686,873
|
10,891
|
|
____
|
____
|
______
|
_____
|
|
* Includes 10 Holiday Inn Club Vacations (3,701 rooms) and 38 Holiday Inn Resort properties (8,818 rooms) (2012: 10 Holiday Inn Club Vacations (3,701 rooms) and 37 Holiday Inn Resort properties (8,806 rooms)).
|
Hotels
|
Rooms
|
||||
Global pipeline
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
51
|
3
|
16,860
|
1,147
|
|
Crowne Plaza
|
94
|
(4)
|
28,369
|
(2,814)
|
|
Holiday Inn*
|
264
|
21
|
50,241
|
5,253
|
|
Holiday Inn Express
|
473
|
21
|
54,744
|
2,984
|
|
Staybridge Suites
|
80
|
9
|
8,728
|
1,184
|
|
Candlewood Suites
|
80
|
2
|
6,914
|
172
|
|
Hotel Indigo
|
51
|
4
|
6,807
|
938
|
|
EVEN Hotels
|
5
|
4
|
880
|
650
|
|
HUALUXE
|
21
|
6
|
6,804
|
1,900
|
|
Other
|
1
|
1
|
114
|
17
|
|
____
|
____
|
______
|
_____
|
||
Total
|
1,120
|
67
|
180,461
|
11,431
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
778
|
34
|
86,785
|
3,884
|
|
Managed
|
339
|
30
|
93,176
|
7,047
|
|
Owned and Leased
|
3
|
3
|
500
|
500
|
|
____
|
____
|
______
|
_____
|
||
Total
|
1,120
|
67
|
180,461
|
11,431
|
|
____
|
____
|
______
|
_____
|
Hotels
|
Rooms
|
||||
Global pipeline signings
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Total
|
444
|
88
|
65,461
|
11,649
|
|
____
|
____
|
______
|
_____
|
|
* Includes 1 Holiday Inn Club Vacations (120 rooms) and 14 Holiday Inn Resort properties (3,163 rooms) (2012: nil Holiday Inn Club Vacations (nil rooms) and 12 Holiday Inn Resort properties (2,390 rooms)).
|
12 months ended 31 December
|
|||||
2013
|
2012
|
%
|
|||
Americas results
|
$m
|
$m
|
change
|
||
Revenue
|
|||||
Franchised
|
576
|
541
|
6.5
|
||
Managed
|
128
|
97
|
32.0
|
||
Owned and leased
|
212
|
199
|
6.5
|
||
____
|
____
|
____
|
|||
Total
|
916
|
837
|
9.4
|
||
____
|
____
|
____
|
|||
Operating profit before exceptional items
|
|||||
Franchised
|
499
|
466
|
7.1
|
||
Managed
|
74
|
48
|
54.2
|
||
Owned and leased
|
30
|
24
|
25.0
|
||
____
|
____
|
_____
|
|||
603
|
538
|
12.1
|
|||
Regional overheads
|
(53)
|
(52)
|
(1.9)
|
||
____
|
____
|
____
|
|||
Total
|
550
|
486
|
13.2
|
||
____
|
____
|
____
|
Americas Comparable RevPAR movement on previous year
|
12 months ended
31 December
2013
|
|
Franchised
|
||
Crowne Plaza
|
4.8%
|
|
Holiday Inn
|
2.6%
|
|
Holiday Inn Express
|
3.4%
|
|
All brands
|
3.2%
|
|
Managed
|
||
InterContinental
|
12.6%
|
|
Crowne Plaza
|
13.9%
|
|
Holiday Inn
|
10.6%
|
|
Staybridge Suites
|
19.8%
|
|
Candlewood Suites
|
19.3%
|
|
All brands
|
13.9%
|
|
Owned and leased
|
||
All brands
|
6.0%
|
Hotels
|
Rooms
|
||||
Americas hotel and room count
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
51
|
(2)
|
17,453
|
(303)
|
|
Crowne Plaza
|
176
|
(7)
|
47,057
|
(1,673)
|
|
Holiday Inn*
|
786
|
(34)
|
138,830
|
(7,831)
|
|
Holiday Inn Express
|
1,985
|
54
|
174,431
|
6,033
|
|
Staybridge Suites
|
188
|
5
|
20,309
|
522
|
|
Candlewood Suites
|
312
|
13
|
29,778
|
1,103
|
|
Hotel Indigo
|
37
|
-
|
4,344
|
37
|
|
Other
|
81
|
32
|
19,222
|
3,919
|
|
____
|
____
|
______
|
_____
|
||
Total
|
3,616
|
61
|
451,424
|
1,807
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
3,394
|
40
|
408,875
|
1,026
|
|
Managed
|
217
|
21
|
40,147
|
564
|
|
Owned and leased
|
5
|
-
|
2,402
|
217
|
|
____
|
____
|
______
|
_____
|
||
Total
|
3,616
|
61
|
451,424
|
1,807
|
|
____
|
____
|
______
|
_____
|
|
* Includes 10 Holiday Inn Club Vacations (3,701 rooms) and 18 Holiday Inn Resort properties (4,438 rooms) (2012: 10 Holiday Inn Club Vacations (3,701 rooms) and 17 Holiday Inn Resort properties (4,240 rooms)).
|
Hotels
|
Rooms
|
||||
Americas pipeline
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
6
|
2
|
1,437
|
512
|
|
Crowne Plaza
|
16
|
-
|
3,228
|
(509)
|
|
Holiday Inn*
|
139
|
-
|
19,344
|
517
|
|
Holiday Inn Express
|
358
|
13
|
33,488
|
1,100
|
|
Staybridge Suites
|
71
|
7
|
7,495
|
847
|
|
Candlewood Suites
|
80
|
2
|
6,914
|
172
|
|
Hotel Indigo
|
23
|
-
|
3,118
|
42
|
|
EVEN Hotels
|
5
|
4
|
880
|
650
|
|
Other
|
1
|
1
|
114
|
114
|
|
____
|
____
|
______
|
_____
|
||
Total
|
699
|
29
|
76,018
|
3,445
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
678
|
19
|
72,019
|
1,729
|
|
Managed
|
18
|
7
|
3,499
|
1,216
|
|
Owned and leased
|
3
|
3
|
500
|
500
|
|
____
|
____
|
______
|
_____
|
||
Total
|
699
|
29
|
76,018
|
3,445
|
|
____
|
____
|
______
|
_____
|
|
* Includes 1 Holiday Inn Club Vacations (120 rooms) and 5 Holiday Inn Resort properties (694 rooms) (2012: nil Holiday Inn Club Vacations (nil rooms) and 5 Holiday Inn Resort properties (640 rooms)).
|
12 months ended 31 December
|
|||||
2013
|
2012
|
%
|
|||
Europe results
|
$m
|
$m
|
change
|
||
Revenue
|
|||||
Franchised
|
104
|
91
|
14.3
|
||
Managed
|
156
|
147
|
6.1
|
||
Owned and leased
|
140
|
198
|
(29.3)
|
||
____
|
____
|
||||
Total
|
400
|
436
|
(8.3)
|
||
____
|
____
|
____
|
|||
Operating profit before exceptional items
|
|||||
Franchised
|
79
|
65
|
21.5
|
||
Managed
|
30
|
32
|
(6.3)
|
||
Owned and leased
|
30
|
50
|
(40.0)
|
||
____
|
____
|
_____
|
|||
139
|
147
|
(5.4)
|
|||
Regional overheads
|
(34)
|
(35)
|
2.9
|
||
____
|
____
|
____
|
|||
Total
|
105
|
112
|
(6.3)
|
||
____
|
____
|
____
|
Europe comparable RevPAR movement on previous year
|
12 months ended
31 December
2013
|
|||
Franchised
|
||||
All brands
|
1.5%
|
|||
Managed
|
||||
All brands
|
2.0%
|
|||
Owned and leased
|
||||
InterContinental
|
5.3%
|
|||
Hotels
|
Rooms
|
||||
Europe hotel and room count
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
31
|
1
|
9,525
|
131
|
|
Crowne Plaza
|
83
|
(1)
|
19,522
|
(44)
|
|
Holiday Inn*
|
282
|
(6)
|
45,621
|
(989)
|
|
Holiday Inn Express
|
215
|
3
|
25,371
|
468
|
|
Staybridge Suites
|
5
|
1
|
784
|
179
|
|
Hotel Indigo
|
13
|
3
|
1,243
|
294
|
|
____
|
____
|
______
|
_____
|
||
Total
|
629
|
1
|
102,066
|
39
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
528
|
-
|
79,517
|
(382)
|
|
Managed
|
100
|
2
|
22,079
|
868
|
|
Owned and leased
|
1
|
(1)
|
470
|
(447)
|
|
____
|
____
|
______
|
_____
|
||
Total
|
629
|
1
|
102,066
|
39
|
|
____
|
____
|
______
|
_____
|
|
* Includes 2 Holiday Inn Resort properties (212 rooms) (2012: 3 Holiday Inn Resort properties (362 rooms)).
|
Hotels
|
Rooms
|
||||
Europe pipeline
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
2
|
-
|
653
|
249
|
|
Crowne Plaza
|
12
|
-
|
2,624
|
(145)
|
|
Holiday Inn
|
35
|
15
|
6,612
|
2,345
|
|
Holiday Inn Express
|
43
|
-
|
6,016
|
(268)
|
|
Staybridge Suites
|
3
|
2
|
298
|
130
|
|
Hotel Indigo
|
15
|
2
|
1,576
|
284
|
|
____
|
____
|
______
|
_____
|
||
Total
|
110
|
19
|
17,779
|
2,595
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
97
|
14
|
14,119
|
1,933
|
|
Managed
|
13
|
5
|
3,660
|
662
|
|
____
|
____
|
______
|
_____
|
||
Total
|
110
|
19
|
17,779
|
2,595
|
|
____
|
____
|
______
|
_____
|
12 months ended 31 December
|
|||||
2013
|
2012
|
%
|
|||
AMEA results
|
$m
|
$m
|
change
|
||
Revenue
|
|||||
Franchised
|
16
|
18
|
(11.1)
|
||
Managed
|
170
|
152
|
11.8
|
||
Owned and leased
|
44
|
48
|
(8.3)
|
||
____
|
____
|
_____
|
|||
Total
|
230
|
218
|
5.5
|
||
____
|
____
|
____
|
|||
Operating profit before exceptional items
|
|||||
Franchised
|
12
|
12
|
-
|
||
Managed
|
92
|
90
|
2.2
|
||
Owned and leased
|
4
|
6
|
(33.3)
|
||
____
|
____
|
_____
|
|||
108
|
108
|
-
|
|||
Regional overheads
|
(22)
|
(20)
|
(10.0)
|
||
____
|
____
|
____
|
|||
Total
|
86
|
88
|
(2.3)
|
||
____
|
____
|
_____
|
AMEA comparable RevPAR movement on previous year
|
12 months ended
31 December
2013
|
|
Franchised
|
||
All brands
|
9.6%
|
|
Managed
|
||
All bands
|
5.6%
|
Hotels
|
Rooms
|
||||
AMEA hotel and room count
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
67
|
2
|
21,383
|
592
|
|
Crowne Plaza
|
67
|
2
|
19,078
|
519
|
|
Holiday Inn*
|
81
|
6
|
18,464
|
1,024
|
|
Holiday Inn Express
|
16
|
4
|
3,500
|
623
|
|
Staybridge Suites
|
3
|
1
|
425
|
121
|
|
Other
|
10
|
(3)
|
1,988
|
(778)
|
|
____
|
____
|
______
|
_____
|
||
Total
|
244
|
12
|
64,838
|
2,101
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
51
|
3
|
11,611
|
751
|
|
Managed
|
191
|
9
|
52,640
|
1,350
|
|
Owned and leased
|
2
|
-
|
587
|
-
|
|
____
|
____
|
______
|
_____
|
||
Total
|
244
|
12
|
64,838
|
2,101
|
|
____
|
____
|
______
|
_____
|
|
* Includes 14 Holiday Inn Resort properties (2,965 rooms) (2012: 14 Holiday Inn Resort properties (3,311 rooms)).
|
Hotels
|
Rooms
|
||||
AMEA pipeline
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
21
|
1
|
5,378
|
12
|
|
Crowne Plaza
|
14
|
(4)
|
4,048
|
(1,297)
|
|
Holiday Inn*
|
49
|
2
|
12,341
|
1,446
|
|
Holiday Inn Express
|
39
|
4
|
7,980
|
889
|
|
Staybridge Suites
|
6
|
-
|
935
|
207
|
|
Hotel Indigo
|
8
|
2
|
1,392
|
460
|
|
____
|
____
|
______
|
_____
|
||
Total
|
137
|
5
|
32,074
|
1,717
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
3
|
1
|
647
|
222
|
|
Managed
|
134
|
4
|
31,427
|
1,495
|
|
____
|
____
|
______
|
_____
|
||
Total
|
137
|
5
|
32,074
|
1,717
|
|
____
|
____
|
______
|
_____
|
|
* Includes 6 Holiday Inn Resort properties (1,579 rooms) (2012: 4 Holiday Inn Resort properties (900 rooms)).
|
12 months ended 31 December
|
|||||
2013
|
2012
|
%
|
|||
Greater China results
|
$m
|
$m
|
change
|
||
Revenue
|
|||||
Franchised
|
3
|
3
|
-
|
||
Managed
|
92
|
89
|
3.4
|
||
Owned and leased
|
141
|
138
|
2.2
|
||
____
|
____
|
_____
|
|||
Total
|
236
|
230
|
2.6
|
||
____
|
____
|
____
|
|||
Operating profit before exceptional items
|
|||||
Franchised
|
5
|
4
|
25.0
|
||
Managed
|
51
|
51
|
-
|
||
Owned and leased
|
47
|
45
|
4.4
|
||
____
|
____
|
_____
|
|||
103
|
100
|
3.0
|
|||
Regional overheads
|
(21)
|
(19)
|
(10.5)
|
||
____
|
____
|
____
|
|||
Total
|
82
|
81
|
1.2
|
||
____
|
____
|
_____
|
Greater China comparable RevPAR movement on previous year
|
12 months ended
31 December
2013
|
|
Managed
|
||
All brands
|
0.6%
|
|
Owned and leased
|
||
InterContinental
|
(0.1)%
|
Hotels
|
Rooms
|
||||
Greater China hotel and room count
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
29
|
7
|
11,742
|
2,369
|
|
Crowne Plaza
|
65
|
5
|
23,234
|
1,782
|
|
Holiday Inn*
|
67
|
3
|
21,662
|
885
|
|
Holiday Inn Express
|
42
|
5
|
11,295
|
1,842
|
|
Hotel Indigo
|
5
|
2
|
612
|
207
|
|
Other
|
-
|
(1)
|
-
|
(141)
|
|
____
|
____
|
______
|
_____
|
||
Total
|
208
|
21
|
68,545
|
6,944
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Franchised
|
4
|
-
|
2,184
|
-
|
|
Managed
|
203
|
21
|
65,858
|
6,944
|
|
Owned and leased
|
1
|
-
|
503
|
-
|
|
____
|
____
|
______
|
_____
|
||
Total
|
208
|
21
|
68,545
|
6,944
|
|
____
|
____
|
______
|
_____
|
|
* Includes 4 Holiday Inn Resort properties (1,203 rooms) (2012: 3 Holiday Inn Resort properties (893 rooms)).
|
Hotels
|
Rooms
|
||||
Greater China pipeline
at 31 December
|
2013
|
Change
over 2012
|
2013
|
Change
over 2012
|
|
Analysed by brand
|
|||||
InterContinental
|
22
|
-
|
9,392
|
374
|
|
Crowne Plaza
|
52
|
-
|
18,469
|
(863)
|
|
Holiday Inn*
|
41
|
4
|
11,944
|
945
|
|
Holiday Inn Express
|
33
|
4
|
7,260
|
1,263
|
|
Hotel Indigo
|
5
|
-
|
721
|
152
|
|
HUALUXE
|
21
|
6
|
6,804
|
1,900
|
|
Other
|
-
|
-
|
-
|
(97)
|
|
____
|
____
|
______
|
_____
|
||
Total
|
174
|
14
|
54,590
|
3,674
|
|
____
|
____
|
______
|
_____
|
||
Analysed by ownership type
|
|||||
Managed
|
174
|
14
|
54,590
|
3,674
|
|
____
|
____
|
______
|
_____
|
||
Total
|
174
|
14
|
54,590
|
3,674
|
|
____
|
____
|
______
|
_____
|
|
* Includes 3 Holiday Inn Resort properties (890 rooms) (2012: 3 Holiday Inn Resort properties (850 rooms)).
|
12 months ended 31 December
|
||||
2013
|
2012
|
%
|
||
Central results
|
$m
|
$m
|
change
|
|
Revenue
|
121
|
114
|
6.1
|
|
Gross central costs
|
(276)
|
(276)
|
-
|
|
____
|
____
|
_____
|
||
Net central costs
|
(155)
|
(162)
|
4.3
|
|
_____
|
_____
|
_____
|
12 months ended 31 December
|
||||
2013
|
2012
|
%
|
||
System Fund results
|
$m
|
$m
|
change
|
|
Assessment fees and contributions received from hotels
|
1,154
|
1,106
|
4.3
|
|
Proceeds from sale of IHG Rewards Club points
|
153
|
144
|
6.3
|
|
____
|
____
|
_____
|
||
Total
|
1,307
|
1,250
|
4.6
|
|
_____
|
____
|
_____
|
2013
|
2012
|
||
Net debt* at 31 December
|
$m
|
$m
|
|
Borrowings:
|
|||
Sterling
|
654
|
638
|
|
US Dollar
|
629
|
626
|
|
Other
|
4
|
5
|
|
Cash and cash equivalents
|
(134)
|
(195)
|
|
____
|
____
|
||
Net debt
|
1,153
|
1,074
|
|
____
|
____
|
||
Average debt levels
|
985
|
651
|
|
____
|
____
|
||
2013
|
2012
|
|
Facilities at 31 December
|
$m
|
$m
|
Committed
|
1,074
|
1,075
|
Uncommitted
|
80
|
96
|
____
|
____
|
|
Total
|
1,154
|
1,171
|
____
|
____
|
Interest risk profile of gross debt for major currencies
at 31 December
|
2013
%
|
2012
%
|
At fixed rates
|
100
|
100
|
Year ended 31 December 2013
|
Year ended 31 December 2012 (restated*)
|
||||||
Before
exceptional
items
|
Exceptional
items
(note 4)
|
Total
|
Before
exceptional
items
|
Exceptional
items
(note 4)
|
Total
|
||
$m
|
$m
|
$m
|
$m
|
$m
|
$m
|
||
Continuing operations
|
|||||||
Revenue (note 3)
|
1,903
|
-
|
1,903
|
1,835
|
-
|
1,835
|
|
Cost of sales
|
(784)
|
-
|
(784)
|
(772)
|
-
|
(772)
|
|
Administrative expenses
|
(374)
|
(167)
|
(541)
|
(372)
|
(16)
|
(388)
|
|
Share of profits of associates and joint ventures
|
2
|
6
|
8
|
3
|
-
|
3
|
|
Other operating income and expenses
|
6
|
166
|
172
|
5
|
(11)
|
(6)
|
|
_____
|
____
|
____
|
_____
|
____
|
____
|
||
753
|
5
|
758
|
699
|
(27)
|
672
|
||
Depreciation and amortisation
|
(85)
|
-
|
(85)
|
(94)
|
-
|
(94)
|
|
Impairment
|
-
|
-
|
-
|
-
|
23
|
23
|
|
_____
|
____
|
____
|
_____
|
____
|
____
|
||
Operating profit (note 3)
|
668
|
5
|
673
|
605
|
(4)
|
601
|
|
Financial income
|
5
|
-
|
5
|
3
|
-
|
3
|
|
Financial expenses
|
(78)
|
-
|
(78)
|
(57)
|
-
|
(57)
|
|
_____
|
____
|
____
|
_____
|
____
|
____
|
||
Profit before tax
|
595
|
5
|
600
|
551
|
(4)
|
547
|
|
Tax (note 5)
|
(175)
|
(51)
|
(226)
|
(151)
|
142
|
(9)
|
|
_____
|
____
|
____
|
_____
|
____
|
____
|
||
Profit for the year from continuing operations
|
420
|
(46)
|
374
|
400
|
138
|
538
|
|
====
|
====
|
====
|
====
|
====
|
====
|
||
Attributable to:
|
|||||||
Equity holders of the parent
|
418
|
(46)
|
372
|
399
|
138
|
537
|
|
Non-controlling interest
|
2
|
-
|
2
|
1
|
-
|
1
|
|
____
|
____
|
____
|
____
|
____
|
____
|
||
420
|
(46)
|
374
|
400
|
138
|
538
|
||
====
|
====
|
====
|
====
|
====
|
====
|
||
Earnings per ordinary share
(note 6)
|
|||||||
Continuing and total operations:
|
|||||||
Basic
|
140.9¢
|
187.1¢
|
|||||
Diluted
|
139.3¢
|
183.9¢
|
|||||
Adjusted
|
158.3¢
|
139.0¢
|
|||||
Adjusted diluted
|
156.6¢
|
136.6¢
|
|||||
====
|
====
|
====
|
====
|
||||
*
|
Restated for the adoption of IAS 19R ‘Employee Benefits’ (see note 1)
|
2013
Year ended
31 December
$m
|
2012
Year ended
31 December
(restated*)
$m
|
||
Profit for the year
|
374
|
538
|
|
Other comprehensive income
|
|||
Items that may be subsequently reclassified to profit or loss:
|
|||
Gains on valuation of available-for-sale financial assets
|
28
|
1
|
|
Losses relating to cash flow hedges reclassified to financial expenses
|
-
|
1
|
|
Exchange (losses)/gains on retranslation of foreign operations, net of related tax credit of $2m (2012 $3m)
|
(35)
|
24
|
|
Exchange losses reclassified to profit on hotel disposal
|
46
|
-
|
|
____
|
____
|
||
39
|
26
|
||
Items that will not be reclassified to profit or loss:
|
|||
Re-measurement gains/(losses) on defined benefit plans, net of related tax charge of $20m (2012 credit of $5m)
|
20
|
(10)
|
|
Tax related to pension contributions
|
-
|
18
|
|
____
|
____
|
||
20
|
8
|
||
____
|
____
|
||
Total other comprehensive income for the year
|
59
|
34
|
|
____
|
____
|
||
Total comprehensive income for the year
|
433
|
572
|
|
====
|
====
|
||
Attributable to:
|
|||
Equity holders of the parent
|
433
|
571
|
|
Non-controlling interest
|
-
|
1
|
|
_____
|
_____
|
||
433
|
572
|
||
=====
|
=====
|
*
|
Restated for the adoption of IAS 19R ‘Employee Benefits’ (see note 1)
|
Year ended 31 December 2013
|
|||||
Equity share capital
|
Other reserves*
|
Retained earnings
|
Non-controlling interest
|
Total equity
|
|
$m
|
$m
|
$m
|
$m
|
$m
|
|
At beginning of the year
|
179
|
(2,652)
|
2,781
|
9
|
317
|
Total comprehensive income for the year
|
-
|
41
|
392
|
-
|
433
|
Issue of ordinary shares
|
5
|
-
|
-
|
-
|
5
|
Repurchase of shares
|
-
|
-
|
(283)
|
-
|
(283)
|
Movement in shares in employee share trusts
|
-
|
11
|
(61)
|
-
|
(50)
|
Equity-settled share-based cost
|
-
|
-
|
27
|
-
|
27
|
Tax related to share schemes
|
-
|
-
|
11
|
-
|
11
|
Equity dividends paid
|
-
|
-
|
(533)
|
(1)
|
(534)
|
Exchange adjustments
|
5
|
(5)
|
-
|
-
|
-
|
_____
|
_____
|
____
|
____
|
____
|
|
At end of the year
|
189
|
(2,605)
|
2,334
|
8
|
(74)
|
=====
|
=====
|
====
|
====
|
====
|
Year ended 31 December 2012
|
|||||
Equity share capital
|
Other reserves*
|
Retained earnings
|
Non-controlling interest
|
Total equity
|
|
$m
|
$m
|
$m
|
$m
|
$m
|
|
At beginning of the year
|
162
|
(2,650)
|
3,035
|
8
|
555
|
Total comprehensive income for the year
|
-
|
26
|
545
|
1
|
572
|
Issue of ordinary shares
|
10
|
-
|
-
|
-
|
10
|
Repurchase of shares
|
(1)
|
-
|
(106)
|
-
|
(107)
|
Transfer to capital redemption reserve
|
-
|
1
|
(1)
|
-
|
-
|
Transaction costs relating to shareholder returns
|
-
|
-
|
(2)
|
-
|
(2)
|
Movement in shares in employee share trusts
|
-
|
(21)
|
(63)
|
-
|
(84)
|
Equity-settled share-based cost
|
-
|
-
|
27
|
-
|
27
|
Tax related to share schemes
|
-
|
-
|
20
|
-
|
20
|
Equity dividends paid
|
-
|
-
|
(679)
|
-
|
(679)
|
Share of reserve in equity accounted investment
|
-
|
-
|
5
|
-
|
5
|
Exchange adjustments
|
8
|
(8)
|
-
|
-
|
-
|
_____
|
_____
|
____
|
____
|
____
|
|
At end of the year
|
179
|
(2,652)
|
2,781
|
9
|
317
|
=====
|
=====
|
====
|
====
|
====
|
*
|
Other reserves comprise the capital redemption reserve, shares held by employee share trusts, other reserves, unrealised gains and losses reserve and currency translation reserve.
|
All items above are shown net of tax.
|
2013
31 December
|
2012
31 December
|
|
$m
|
$m
|
|
ASSETS
|
||
Property, plant and equipment
|
1,169
|
1,056
|
Goodwill
|
80
|
93
|
Intangible assets
|
438
|
354
|
Investment in associates and joint ventures
|
85
|
84
|
Retirement benefit assets
|
7
|
99
|
Other financial assets
|
236
|
155
|
Non-current tax receivable
|
16
|
24
|
Deferred tax assets
|
108
|
204
|
_____
|
_____
|
|
Total non-current assets
|
2,139
|
2,069
|
_____
|
_____
|
|
Inventories
|
4
|
4
|
Trade and other receivables
|
423
|
422
|
Current tax receivable
|
12
|
31
|
Derivative financial instruments
|
1
|
2
|
Other financial assets
|
12
|
6
|
Cash and cash equivalents
|
134
|
195
|
_____
|
_____
|
|
Total current assets
|
586
|
660
|
Non-current assets classified as held for sale
|
228
|
534
|
______
|
______
|
|
Total assets (note 3)
|
2,953
|
3,263
|
=====
|
=====
|
|
LIABILITIES
|
||
Loans and other borrowings
|
(16)
|
(16)
|
Trade and other payables
|
(748)
|
(709)
|
Provisions
|
(3)
|
(1)
|
Current tax payable
|
(47)
|
(54)
|
_____
|
_____
|
|
Total current liabilities
|
(814)
|
(780)
|
_____
|
_____
|
|
Loans and other borrowings
|
(1,269)
|
(1,242)
|
Derivative financial instruments
|
(11)
|
(19)
|
Retirement benefit obligations
|
(184)
|
(187)
|
Trade and other payables
|
(574)
|
(563)
|
Provisions
|
-
|
(1)
|
Deferred tax liabilities
|
(175)
|
(93)
|
_____
|
_____
|
|
Total non-current liabilities
|
(2,213)
|
(2,105)
|
Liabilities classified as held for sale
|
-
|
(61)
|
_____
|
_____
|
|
Total liabilities
|
(3,027)
|
(2,946)
|
=====
|
=====
|
|
Net (liabilities)/assets
|
(74)
|
317
|
=====
|
=====
|
|
EQUITY
|
||
Equity share capital
|
189
|
179
|
Capital redemption reserve
|
12
|
11
|
Shares held by employee share trusts
|
(38)
|
(48)
|
Other reserves
|
(2,906)
|
(2,901)
|
Unrealised gains and losses reserve
|
100
|
72
|
Currency translation reserve
|
227
|
214
|
Retained earnings
|
2,334
|
2,781
|
______
|
______
|
|
IHG shareholders’ equity
|
(82)
|
308
|
Non-controlling interest
|
8
|
9
|
______
|
______
|
|
Total equity
|
(74)
|
317
|
=====
|
=====
|
2013
Year ended
31 December
|
2012
Year ended
31 December
(restated*)
|
||
$m
|
$m
|
||
Profit for the year
|
374
|
538
|
|
Adjustments for:
|
|||
Net financial expenses
|
73
|
54
|
|
Income tax charge
|
226
|
9
|
|
Depreciation and amortisation
|
85
|
94
|
|
Impairment
|
-
|
(23)
|
|
Other exceptional operating items
|
(5)
|
27
|
|
Equity-settled share-based cost
|
22
|
22
|
|
Dividends from associates and joint ventures
|
5
|
1
|
|
Other items
|
2
|
(3)
|
|
_____
|
_____
|
||
Operating cash flow before movements in working capital
|
782
|
719
|
|
Net change in loyalty programme liability and System Fund surplus
|
61
|
57
|
|
Other changes in net working capital
|
(1)
|
(24)
|
|
Utilisation of provisions
|
(3)
|
(12)
|
|
Retirement benefit contributions, net of cost
|
(18)
|
(95)
|
|
Cash flows relating to exceptional operating items
|
(33)
|
(6)
|
|
_____
|
_____
|
||
Cash flow from operations
|
788
|
639
|
|
Interest paid
|
(74)
|
(50)
|
|
Interest received
|
2
|
2
|
|
Tax paid on operating activities
|
(92)
|
(119)
|
|
_____
|
_____
|
||
Net cash from operating activities
|
624
|
472
|
|
_____
|
_____
|
||
Cash flow from investing activities
|
|||
Purchase of property, plant and equipment
|
(159)
|
(44)
|
|
Purchase of intangible assets
|
(86)
|
(84)
|
|
Investment in other financial assets
|
(154)
|
(2)
|
|
Investment in associates and joint ventures
|
(10)
|
(3)
|
|
Disposal of hotel assets, net of costs
|
460
|
4
|
|
Proceeds from other financial assets
|
109
|
4
|
|
Distribution from associate on sale of hotel
|
17
|
-
|
|
Proceeds from other associates and joint ventures
|
3
|
-
|
|
Tax paid on disposals
|
(5)
|
(3)
|
|
_____
|
_____
|
||
Net cash from investing activities
|
175
|
(128)
|
|
_____
|
_____
|
||
Cash flow from financing activities
|
|||
Proceeds from the issue of share capital
|
5
|
10
|
|
Purchase of own shares
|
(283)
|
(107)
|
|
Purchase of own shares by employee share trusts
|
(44)
|
(84)
|
|
Dividends paid to shareholders
|
(533)
|
(679)
|
|
Dividends paid to non-controlling interests
|
(1)
|
-
|
|
Transaction costs relating to shareholder returns
|
-
|
(2)
|
|
Issue of long-term bonds
|
-
|
632
|
|
Decrease in other borrowings
|
(1)
|
(99)
|
|
_____
|
_____
|
||
Net cash from financing activities
|
(857)
|
(329)
|
|
_____
|
_____
|
||
Net movement in cash and cash equivalents in the year
|
(58)
|
15
|
|
Cash and cash equivalents at beginning of the year
|
195
|
182
|
|
Exchange rate effects
|
(3)
|
(2)
|
|
_____
|
_____
|
||
Cash and cash equivalents at end of the year
|
134
|
195
|
|
=====
|
=====
|
* Restated for the adoption of IAS 19R ‘Employee Benefits’ (see note 1)
|
1.
|
Basis of preparation
|
The audited consolidated financial statements of InterContinental Hotels Group PLC (the Group or IHG) for the year ended 31 December 2013 have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006. Other than the changes listed below, they have been prepared on a consistent basis using the accounting policies set out in the InterContinental Hotels Group PLC (the Group or IHG) Annual Report and Financial Statements for the year ended 31 December 2012.
With effect from 1 January 2013, the Group has adopted IAS 19 (Revised) ‘Employee Benefits’ which introduces a number of changes to accounting for defined benefit plans, including the removal of expected returns on plan assets from the income statement. Instead, there is a requirement to recognise interest on the net defined benefit asset/liability (after any asset restrictions), calculated using the discount rate used to measure the defined benefit obligation. This change in accounting policy has required restatements of the Group income statement, Group statement of comprehensive income and Group statement of cash flows for the year ended 31 December 2012, resulting in an additional charge to operating profit of $9m with an equivalent reduction in actuarial losses in other comprehensive income. The tax impacts of the adjustments are a $2m credit to the income statement with an equivalent charge against the reduced actuarial losses in other comprehensive income. Basic, diluted, adjusted and adjusted diluted earnings per share are reduced by 2.4, 2.4, 2.5 and 2.4 cents respectively. There has been no change to previously reported retained earnings or balance sheet amounts.
The Group has also adopted IAS 1 (Amendment) ‘Presentation of Items of Other Comprehensive Income’, which changes the grouping of items presented in the Group’s statement of comprehensive income so that items which may be reclassified to profit or loss in the future are presented separately from items that will never be reclassified. The amendment affects presentation only and has had no impact on the Group’s financial position or performance.
In addition, with effect from 1 January 2013, the Group has implemented IAS 28 (Amendment) ‘Investments in Associates and Joint Ventures’, IFRS 10 ‘Consolidated Financial Statements’, IFRS 11 ‘Joint Arrangements’, IFRS 12 ‘Disclosure of Interests in Other Entities’ and IFRS 13 ‘Fair Value Measurement’. The adoption of these standards has had no material impact on the Group’s financial performance or position and there has been no requirement to restate prior year comparatives.
|
2.
|
Exchange rates
|
The results of operations have been translated into US dollars at the average rates of exchange for the year. In the case of sterling, the translation rate is $1= £0.64 (2012 $1=£0.63). In the case of the euro, the translation rate is $1 = €0.75 (2012 $1 = €0.78).
Assets and liabilities have been translated into US dollars at the rates of exchange on the last day of the year. In the case of sterling, the translation rate is $1=£0.60 (2012 $1 = £0.62). In the case of the euro, the translation rate is $1 = €0.73 (2012 $1 = €0.76).
|
3.
|
Segmental information
|
||
Revenue
|
|||
2013
|
2012
|
||
$m
|
$m
|
||
Americas
|
916
|
837
|
|
Europe
|
400
|
436
|
|
AMEA
|
230
|
218
|
|
Greater China
|
236
|
230
|
|
Central
|
121
|
114
|
|
____
|
____
|
||
Total revenue
|
1,903
|
1,835
|
|
====
|
====
|
||
All results relate to continuing operations.
|
Profit
|
2013
$m
|
2012
(restated*)
$m
|
|
Americas
|
550
|
486
|
|
Europe
|
105
|
112
|
|
AMEA
|
86
|
88
|
|
Greater China
|
82
|
81
|
|
Central
|
(155)
|
(162)
|
|
____
|
____
|
||
Reportable segments’ operating profit
|
668
|
605
|
|
Exceptional operating items (note 4)
|
5
|
(4)
|
|
____
|
____
|
||
Operating profit
|
673
|
601
|
|
Net finance costs
|
(73)
|
(54)
|
|
____
|
____
|
||
Profit before tax
|
600
|
547
|
|
====
|
====
|
||
All results relate to continuing operations.
|
|||
* Restated for the adoption of IAS 19R ‘Employee Benefits’ (see note 1)
|
Assets
|
2013
$m
|
2012
$m
|
|
Americas
|
1,079
|
957
|
|
Europe
|
654
|
928
|
|
AMEA
|
253
|
282
|
|
Greater China
|
392
|
390
|
|
Central
|
304
|
250
|
|
____
|
____
|
||
Segment assets
|
2,682
|
2,807
|
|
Unallocated assets:
|
|||
Non-current tax receivable
|
16
|
24
|
|
Deferred tax assets
|
108
|
204
|
|
Current tax receivable
|
12
|
31
|
|
Derivative financial instruments
|
1
|
2
|
|
Cash and cash equivalents
|
134
|
195
|
|
____
|
____
|
||
Total assets
|
2,953
|
3,263
|
|
====
|
====
|
4.
|
Exceptional items
|
|||||
2013
$m
|
2012
$m
|
|||||
Continuing operations:
|
||||||
Exceptional operating items
|
||||||
Administrative expenses:
|
||||||
Litigation (a)
|
(10)
|
-
|
||||
Loyalty programme rebranding costs (b)
|
(10)
|
-
|
||||
Pension settlement loss (c)
|
(147)
|
-
|
||||
Reorganisation costs (d)
|
-
|
(16)
|
||||
____
|
____
|
|||||
(167)
|
(16)
|
|||||
Share of profits of associates and joint ventures:
|
||||||
Share of gain on disposal of a hotel (e)
|
6
|
-
|
||||
Other operating income and expenses:
|
||||||
Gain/(loss) on disposal of hotels (f)
|
166
|
(2)
|
||||
Write-off of software (g)
|
-
|
(18)
|
||||
Demerger liability released (h)
|
-
|
9
|
||||
____
|
____
|
|||||
166
|
(11)
|
|||||
Impairment:
|
||||||
Reversals of previously recorded impairment:
|
||||||
Property, plant and equipment (i)
|
-
|
23
|
||||
____
|
____
|
|||||
5
|
(4)
|
|||||
====
|
====
|
|||||
Tax
|
||||||
Tax on exceptional operating items
|
(6)
|
1
|
||||
Exceptional tax (j)
|
(45)
|
141
|
||||
____
|
____
|
|||||
(51)
|
142
|
|||||
====
|
====
|
These items are treated as exceptional by reason of their size or nature.
|
||
a)
|
Relates to an agreed settlement.
|
|
b)
|
Relates to costs incurred in support of the worldwide rebranding of IHG Rewards Club that was announced 1 July 2013.
|
|
c)
|
Arises from a buy-in of the Group’s UK funded defined benefit obligations with the insurer, Rothesay Life, on 15 August 2013.
|
|
d)
|
Arose from a reorganisation of the Group’s support functions together with a restructuring within the AMEA region.
|
|
e)
|
Relates to the sale of a hotel owned by an associate in the Americas region.
|
|
f)
|
Relates to the sale of the InterContinental London Park Lane on 1 May 2013 and, in 2012, related to the sale of an interest in a hotel in the Europe region.
|
|
g)
|
Resulted from a reassessment of the ongoing value of elements of the technology infrastructure.
|
|
h)
|
Resulted from a release of a liability no longer required which arose on the demerger of the Group from Six Continents PLC.
|
|
i)
|
Related to the reversal of a previously recorded impairment charge on a North American hotel.
|
|
j)
|
In 2013, comprises a deferred tax charge of $63m consequent upon the disposal of the InterContinental London Park Lane hotel, together with charges and credits of $38m and $19m respectively from associated restructurings (including intra-group dividends) and refinancings, offset by the recognition of $37m of previously unrecognised tax credits. In 2012, represented the recognition of $104m of deferred tax assets, principally relating to pre-existing overseas tax losses, whose value had become more certain as a result of a change in law and the resolution of prior period tax matters, together with the associated release of $37m of provisions.
|
5.
|
Tax
|
The tax charge on profit from continuing operations, excluding the impact of exceptional items (note 4), has been calculated using a tax rate of 29% (2012 27%) analysed as follows.
|
2013
|
2013
|
2013
|
2012
(restated*)
|
2012
(restated*)
|
2012
(restated*)
|
|||
Year ended 31 December
|
Profit
$m
|
Tax
$m
|
Tax
rate
|
Profit
$m
|
Tax
$m
|
Tax
rate
|
||
Before exceptional items
|
595
|
(175)
|
29%
|
551
|
(151)
|
27%
|
||
Exceptional items
|
5
|
(51)
|
(4)
|
142
|
||||
____
|
____
|
____
|
____
|
|||||
600
|
(226)
|
547
|
(9)
|
|||||
====
|
====
|
====
|
====
|
|||||
Analysed as:
|
||||||||
UK tax
|
(1)
|
16
|
||||||
Foreign tax
|
(225)
|
(25)
|
||||||
____
|
____
|
|||||||
(226)
|
(9)
|
|||||||
====
|
====
|
* Restated for the adoption of IAS 19R ‘Employee Benefits’ (see note 1)
|
6.
|
Earnings per ordinary share
|
Basic earnings per ordinary share is calculated by dividing the profit for the year available for IHG equity holders by the weighted average number of ordinary shares, excluding investment in own shares, in issue during the year.
Diluted earnings per ordinary share is calculated by adjusting basic earnings per ordinary share to reflect the notional exercise of the weighted average number of dilutive ordinary share options outstanding during the year.
Adjusted earnings per ordinary share is disclosed in order to show performance undistorted by exceptional items, to give a more meaningful comparison of the Group’s performance.
|
Continuing and total operations
|
2013
|
2012
(restated*)
|
||
Basic earnings per ordinary share
|
||||
Profit available for equity holders ($m)
|
372
|
537
|
||
Basic weighted average number of ordinary shares (millions)
|
264
|
287
|
||
Basic earnings per ordinary share (cents)
|
140.9
|
187.1
|
||
====
|
====
|
|||
Diluted earnings per ordinary share
|
||||
Profit available for equity holders ($m)
|
372
|
537
|
||
Diluted weighted average number of ordinary shares (millions)
|
267
|
292
|
||
Diluted earnings per ordinary share (cents)
|
139.3
|
183.9
|
||
====
|
====
|
|||
Adjusted earnings per ordinary share
|
||||
Profit available for equity holders ($m)
|
372
|
537
|
||
Adjusting items (note 4):
|
||||
Exceptional operating items ($m)
|
(5)
|
4
|
||
Tax on exceptional operating items ($m)
|
6
|
(1)
|
||
Exceptional tax ($m)
|
45
|
(141)
|
||
____
|
____
|
|||
Adjusted earnings ($m)
|
418
|
399
|
||
Basic weighted average number of ordinary shares (millions)
|
264
|
287
|
||
Adjusted earnings per ordinary share (cents)
|
158.3
|
139.0
|
||
====
|
====
|
|||
Diluted weighted average number of ordinary shares (millions)
|
267
|
292
|
||
Adjusted diluted earnings per ordinary share (cents)
|
156.6
|
136.6
|
||
====
|
====
|
The diluted weighted average number of ordinary shares is calculated as:
|
|||
2013
millions
|
2012
millions
|
||
Basic weighted average number of ordinary shares
|
264
|
287
|
|
Dilutive potential ordinary shares – employee share options
|
3
|
5
|
|
____
|
____
|
||
267
|
292
|
||
====
|
====
|
* Restated for the adoption of IAS 19R ‘Employee Benefits’ (see note 1)
|
7.
|
Dividends and shareholder returns
|
|||||
2013
cents per share
|
2012
cents per share
|
2013
$m
|
2012
$m
|
|||
Paid during the year:
|
||||||
Final (declared for previous year)
|
43.0
|
39.0
|
115
|
113
|
||
Interim
|
23.0
|
21.0
|
63
|
61
|
||
Special
|
133.0
|
172.0
|
355
|
505
|
||
____
|
____
|
____
|
____
|
|||
199.0
|
232.0
|
533
|
679
|
|||
====
|
====
|
====
|
====
|
|||
Proposed for approval at the Annual General Meeting
(not recognised as a liability at 31 December)
|
||||||
Final
|
47.0
|
43.0
|
121
|
115
|
||
====
|
====
|
====
|
====
|
|||
Under the $500m share buyback programme announced 7 August 2012, 9,773,912 shares were repurchased in the year to 31 December 2013 for a consideration of $283m, increasing the total amount repurchased to $390m. All of the shares repurchased in 2013 were held as Treasury shares at 31 December 2013, the cost of which has been deducted from retained earnings. There were no Treasury shares held at 31 December 2012 or earlier.
On 6 August 2013, the Group also announced a special dividend of 133.0 cents per share amounting to $355m which was paid to shareholders on 4 October 2013.
|
8.
|
Net debt
|
||
2013
|
2012
|
||
$m
|
$m
|
||
Cash and cash equivalents
|
134
|
195
|
|
Loans and other borrowings – current
|
(16)
|
(16)
|
|
Loans and other borrowings – non-current
|
(1,269)
|
(1,242)
|
|
Derivatives hedging debt values*
|
(2)
|
(11)
|
|
____
|
____
|
||
Net debt
|
(1,153)
|
(1,074)
|
|
====
|
====
|
||
Finance lease obligation included above
|
(215)
|
(212)
|
|
====
|
====
|
*
|
Net debt includes the exchange element of the fair value of currency swaps that fix the value of the Group’s £250m 6% bonds at $415m. An equal and opposite exchange adjustment on the retranslation of the £250m 6% bonds is included in non-current loans and other borrowings.
|
9.
|
Movement in net debt
|
||||
2013
|
2012
|
||||
$m
|
$m
|
||||
Net (decrease)/increase in cash and cash equivalents
|
(58)
|
15
|
|||
Add back cash flows in respect of other components of net debt:
|
|||||
Issue of long-term bonds
|
-
|
(632)
|
|||
Decrease in other borrowings
|
1
|
99
|
|||
____
|
____
|
||||
Increase in net debt arising from cash flows
|
(57)
|
(518)
|
|||
Non-cash movements:
|
|||||
Finance lease obligation
|
(3)
|
(3)
|
|||
Exchange and other adjustments
|
(19)
|
(15)
|
|||
____
|
____
|
||||
Increase in net debt
|
(79)
|
(536)
|
|||
Net debt at beginning of the year
|
(1,074)
|
(538)
|
|||
____
|
____
|
||||
Net debt at end of the year
|
(1,153)
|
(1,074)
|
|||
====
|
====
|
10.
|
Fair values
|
|||
|
The table below compares carrying amounts and fair values of the Group’s financial assets and liabilities at 31 December 2013:
|
|||
Carrying value
$m
|
Fair value
$m
|
|||
Financial assets:
|
||||
Equity securities available-for-sale
|
136
|
136
|
||
Loans and receivables
|
112
|
112
|
||
_____
|
_____
|
|||
Other financial assets
|
248
|
248
|
||
=====
|
=====
|
|||
Financial liabilities:
|
||||
£250m 6% bonds 2016
|
(412)
|
(461)
|
||
£400m 3.875% bonds 2022
|
(654)
|
(650)
|
||
Finance lease obligations
|
(215)
|
(233)
|
||
Derivatives
|
(11)
|
(11)
|
||
Other borrowings
|
(4)
|
(4)
|
||
_____
|
_____
|
|||
(1,296)
|
(1,359)
|
|||
=====
|
=====
|
|
Equity securities available-for-sale and derivatives are held in the Group statement of financial position at fair value as set out below. The fair value of loans and receivables approximates book value based on prevailing market rates. The fair value of the £250m and £400m bonds is based on their quoted market price. The fair value of finance lease obligations is calculated by discounting future cash flows at prevailing interest rates. The fair value of other borrowings approximates book value as interest rates reset to market rates on a frequent basis.
The following table provides the fair value measurement hierarchy of the above assets and liabilities, other than those with carrying amounts which are reasonable approximations of their fair values:
Level 1: quoted (unadjusted) prices in active markets for identical assets or liabilities.
Level 2: other techniques for which all inputs which have a significant effect on fair value are observable, either directly or indirectly.
Level 3: techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.
|
Level 1
$m
|
Level 2
$m
|
Level 3
$m
|
2013
31 December
Total
$m
|
||
Assets
|
|||||
Equity securities available-for-sale:
|
|||||
Quoted equity shares
|
9
|
-
|
-
|
9
|
|
Unquoted equity shares
|
-
|
-
|
127
|
127
|
|
Liabilities
|
|||||
£250m 6% bonds 2016
|
(461)
|
-
|
-
|
(461)
|
|
£400m 3.875% bonds 2022
|
(650)
|
-
|
-
|
(650)
|
|
Finance lease obligations
|
-
|
(233)
|
-
|
(233)
|
|
Derivatives
|
-
|
(11)
|
-
|
(11)
|
|
There were no transfers between Level 1 and Level 2 fair value measurements during the year and no transfers into and out of Level 3.
The Level 2 derivative financial instruments consist of currency swaps which are fair valued using data from observable swap curves, adjusted to take account of the Group’s own credit risk.
The Level 3 equity securities relate to investments in unlisted shares which are fair valued either by applying an average price-earnings (P/E) ratio for a competitor group to the earnings generated by the investment, or by reference to share of net assets. The average P/E ratio used for the year was 23.9 and a non-marketability factor of 30% is applied. A 10% increase in the average P/E ratio would result in a $5m increase in the fair value of the investments and a 10% decrease in the average P/E ratio would result in a $5m decrease in the fair value of the investments. A 10% increase in net assets would result in a $5m increase in the fair value of investments and a 10% decrease in net assets would result in a $5m decrease in the fair value of the investments.
The following table reconciles movements in instruments classified as Level 3 during the year:
|
|||||
2013
31 December
$m
|
|||||
At 1 January 2013
|
94
|
||||
Additions
|
8
|
||||
Valuation gains recognised in other comprehensive income
|
25
|
||||
____
|
|||||
At 31 December 2013
|
127
|
||||
====
|
11.
|
Commitments and contingencies
|
At 31 December 2013, the amount contracted for but not provided for in the financial statements for expenditure on property, plant and equipment and intangible assets was $83m (2012 $81m). The Group has also committed to invest up to $61m in three investments accounted for under the equity method of which $41m had been spent at 31 December 2013.
At 31 December 2013, the Group had no contingent liabilities (2012 $1m).
In limited cases, the Group may provide performance guarantees to third-party hotel owners to secure management contracts. The maximum unprovided exposure under such guarantees is $48m (2012 $50m).
From time to time, the Group is subject to legal proceedings the ultimate outcome of each being always subject to many uncertainties inherent in litigation. The Group has also given warranties in respect of the disposal of certain of its former subsidiaries. It is the view of the Directors that, other than to the extent that liabilities have been provided for in these financial statements, it is not possible to quantify any loss to which these proceedings or claims under these warranties may give rise, however, as at the date of reporting, the Group does not believe that the outcome of these matters will have a material effect on the Group’s financial position.
|
12.
|
Events after the reporting period
|
In February 2014, the Group signed an agreement to sell the InterContinental Mark Hopkins San Francisco for $120m in cash and enter into a long term management contract on the hotel. The hotel had a net book value of $90m at 31 December 2013.
|
13.
|
Group financial statements
|
The preliminary statement of results was approved by the Board on 17 February 2014. The preliminary statement of results does not represent the full Group financial statements of InterContinental Hotels Group PLC and its subsidiaries which will be delivered to the Registrar of Companies in due course. The financial information for the year ended 31 December 2012 has been extracted from the IHG Annual Report and Financial Statements for that year as filed with the Registrar of Companies.
|
|
Auditor’s review
|
|
The auditors, Ernst & Young LLP, have given an unqualified report under Chapter 3 of Part 16 of the Companies Act 2006 in respect of the full Group financial statements.
|
InterContinental Hotels Group PLC
|
||
(Registrant)
|
||
By:
|
/s/ H. Patel
|
|
Name:
|
H. PATEL
|
|
Title:
|
COMPANY SECRETARIAL OFFICER
|
|
Date:
|
18 February 2014
|
|