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99.1
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Third
Quarter Trading Update
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Highlights
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Global Q3 comparable
RevPAR1
up 2.3%, and up
2.2% Q3 YTD
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Enhanced global scale: 11k
rooms opened, increasing net system size 4.1% YoY to 786k
rooms
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Building future growth: 20k
rooms (137 hotels) signed; pipeline of 235k
rooms
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Keith Barr, Chief Executive of InterContinental Hotels Group PLC,
said:
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"We
have delivered a good third quarter performance; RevPAR increased
by 2.3% and net rooms growth of 4.1% was our strongest since
20102. We
also signed hotels into our pipeline at the fastest third quarter
rate since 2008, and have made an excellent start with our plans to
accelerate the growth of our brands around the
world.
Our new
US midscale brand, avid hotels, is generating strong traction with
our owner community. With over 150 written expressions of
interest and more than 50 applications in the first four weeks of
franchise sales, demand from owners has exceeded our original
expectations.
The
international expansion of our newest brands is gathering pace.
This week we continued the global roll out of Kimpton Hotels &
Restaurants, with a landmark signing in Bali and two signings in
key Chinese urban and resort locations, Shanghai and Sanya Bay.
We have several further deals in progress which will secure
our presence for the brand in ten major markets around the world.
We have also expanded the global footprint of EVEN Hotels, with
signings in Shanghai, Sanya Bay and Auckland, New
Zealand.
"Franchise
Plus", our franchising solution for Holiday Inn Express in China,
is gaining momentum with 6 hotels now open and a further 58 in the
pipeline, including 19 signings in the quarter. We expect a
further ramp up in activity over the next 12 months.
Looking
ahead, despite macro-economic and geopolitical uncertainties around
the world, we remain confident in the outlook for the remainder of
the year."
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Third Quarter RevPAR performance
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Americas
RevPAR
was up 0.8% in Q3, and 1.1% Q3 YTD. In the US, RevPAR was up
0.4% in Q3 and 0.6% Q3 YTD with performance in the quarter impacted
by several events. Hurricanes Harvey and Irma had a mixed impact;
displacement activity together with the relief and reconstruction
efforts benefitted our franchise business; but performance across
the managed estate was negatively impacted by the cancellation of
group bookings at some hotels. Meanwhile the negative impact of
calendar shifts was partially offset by incremental demand from the
solar eclipse. Excluding the effect of the hurricanes and
these one-off events, we estimate that underlying US RevPAR was
marginally positive in the quarter. Elsewhere in the region, Canada
and Latin America continued to grow well, up 7% and 8%
respectively, whilst in Mexico RevPAR was flat due to the
earthquake in Mexico City.
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Europe
RevPAR
was up 7.1% in Q3, and 6.6% Q3 YTD. The UK delivered Q3
RevPAR growth of 4.0% with our brands driving outperformance in
both London, up 3%, and the provinces, up 5%. RevPAR growth
in Germany of 3% reflected a more moderate trade fair calendar as
expected, and continued strong corporate and leisure demand drove
mid-single digit RevPAR growth in Russia. Markets previously
impacted by terrorist attacks grew strongly, including RevPAR
growth of 6% in France, and double digit growth in Belgium and
Turkey. Performance across several markets in Southern Europe
was also strong due to increased demand over the summer
months.
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Asia, Middle East & Africa
RevPAR was up 0.6% in Q3, and 1.2% Q3 YTD. Outside the Middle
East, RevPAR grew 4%. India RevPAR growth of almost 10%
continued to be driven by tourism, whilst Australasia and Southeast
Asia were both up mid-single digits. In Japan, flat RevPAR
reflects weak transient demand and disruption from a typhoon in
September. In the Middle East, RevPAR declined 6% due to the
timing of Ramadan, and the ongoing impact of low oil prices, high
supply growth and government austerity measures.
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Greater China
RevPAR was up 7.8% in the quarter and 5.4% Q3 YTD. Q3 growth
of 9% in mainland China was helped by weak comparables driven by
one-off events in tier 2-3 cities in the quarter last year. Tier
1-3 cities all delivered high single digit RevPAR growth
benefitting from strong corporate and meetings demand. Hong
Kong RevPAR was down 1%, impacted by renovations at one property,
whilst 15% RevPAR growth in Macau reflects improving leisure demand
and the ongoing ramp up of one new hotel.
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Strategic progress
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Strengthening our portfolio of preferred brands
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Launched avid hotels, our new build
brand targeting a $20 billion underserved segment in the US. This
will become another brand of scale for IHG and we are already
gaining strong traction with owners with over 150 written
expressions of interest since launch, and over 50 applications in
the first 4 weeks of franchise sales.
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Strengthened our position in the
boutique segment with two openings and three signings for Kimpton
in the US and, in October, the launch of the brand in our Greater
China and AMEA regions. 10 signings and two openings for
Hotel Indigo takes this brand to 163 open and pipeline
properties.
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Expanded our global presence for EVEN
hotels, with two Q3 signings in Greater China and one in New
Zealand.
- Signed
13k rooms into the Holiday Inn Brand Family pipeline, including a
record third quarter for Holiday Inn Express, and opened almost 7k
rooms.
Increasing our pace of net system growth
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Net system size up 4.1% year on year
to 786k rooms (5,272 hotels), our fastest pace of growth since
20102,
led by AMEA (14%) and Greater China (10%).
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11k rooms (70 hotels) opened in the
quarter, our best Q3 for six years, and 3k rooms (19 hotels)
removed.
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20k rooms (137 hotels) were signed;
our highest Q3 signings since 2008.
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Continued to expand our China
franchising solution "Franchise Plus" with 19 new Holiday Inn
Express deals signed in the quarter bringing the total to 63
signings after just 17 months.
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235k pipeline rooms with ~45% under
construction.
Driving revenue delivery through technology and
loyalty
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Our innovative cloud-based Guest
Reservations System remains on track for roll-out starting by the
end of 2017 with full deployment expected by late 2018 / early
2019.
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In September, the IHG App for mobile
passed the milestone of $1 billion of gross room revenues booked
through the platform, up fourfold over the past 3 years. Having
been downloaded over 9 million times since its launch, it is one of
the highest rated hotel mobile apps on the iOS app
store.
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In early 2018, Kimpton Karma Rewards,
the loyalty program of Kimpton Hotels & Restaurants, will
become a part of IHG®
Rewards Club and offer all members one
program with a single reward point system.
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Financial position and capital allocation
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The financial position of the group remains robust, with an
on-going commitment to an efficient balance sheet and an investment
grade credit rating.
As previously announced, on 6 October we paid an interim ordinary
dividend to shareholders of 33¢ per share. This takes
the total returned to shareholders, including from ordinary
dividends, to $12.9bn since demerger in 2003.
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Foreign exchange
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The weakening of the US Dollar against many major currencies
globally increased group RevPAR to 2.7% in the quarter, when
reported at actual exchange rates. A breakdown of constant
vs. actual currency RevPAR by region is set out in Appendix
2.
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Q3 2017
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YTD 2017
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RevPAR
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Rate
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Occ.
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RevPAR
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Rate
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Occ.
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Group
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2.3%
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0.8%
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1.1%pts
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2.2%
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0.8%
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1.0%pts
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Americas
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0.8%
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0.7%
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0.1%pts
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1.1%
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0.9%
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0.1%pts
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Europe
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7.1%
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4.0%
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2.3%pts
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6.6%
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3.5%
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2.2%pts
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AMEA
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0.6%
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(1.0)%
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1.1%pts
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1.2%
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(1.1)%
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1.6%pts
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G.
China
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7.8%
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0.9%
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4.5%pts
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5.4%
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(0.4)%
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3.6%pts
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Q3 2017
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YTD 2017
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CER
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AER
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Difference
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CER
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AER
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Difference
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Group
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2.3%
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2.7%
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(0.4)%pts
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2.2%
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1.4%
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0.8%pts
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Americas
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0.8%
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1.3%
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(0.5)%pts
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1.1%
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1.1%
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-
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Europe
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7.1%
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9.8%
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(2.7)%pts
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6.6%
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3.4%
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3.2%pts
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AMEA
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0.6%
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(1.8)%
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2.4%pts
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1.2%
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(0.3)%
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1.5%pts
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G.
China
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7.8%
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7.6%
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0.2%pts
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5.4%
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2.6%
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2.8%pts
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System
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Pipeline
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Openings
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Removals
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Net
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Total
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Signings
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Total
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Group
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10,699
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(2,830)
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7,869
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785,544
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19,789
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234,700
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Americas
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4,751
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(2,651)
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2,100
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492,049
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8,544
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104,172
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Europe
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1,512
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(407)
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1,105
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111,467
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1,539
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23,382
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AMEA
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1,502
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275
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1,777
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83,709
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2,242
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35,287
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G.
China
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2,934
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(47)
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2,887
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98,319
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7,464
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71,859
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System
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Pipeline
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Openings
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Removals
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Net
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Total
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YOY%
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Signings
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Total
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Group
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33,556
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(15,147)
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18,409
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785,544
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4.1%
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51,562
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234,700
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Americas
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15,369
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(11,313)
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4,056
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492,049
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1.7%
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24,358
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104,172
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Europe
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2,955
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(1,557)
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1,398
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111,467
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3.8%
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4,667
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23,382
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AMEA
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8,412
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(754)
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7,658
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83,709
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13.5%
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5,245
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35,287
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G.
China
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6,820
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(1,523)
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5,297
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98,319
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10.1%
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17,292
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71,859
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AER: Actual exchange rates used for each respective
period.
CER: Constant exchange rates.
RevPAR: Revenue per available room.
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For further information, please contact:
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Investor
Relations (Catherine Dolton; Tom Yates; Kavita Tatla):
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+44 (0)1895 512176
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+44
(0)7808 098724
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Media
Relations (Yasmin Diamond; Mark Debenham):
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+44
(0)1895 512097
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+44
(0)7527 424046
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Conference call for Analysts and Shareholders:
A conference call with Paul Edgecliffe-Johnson (Chief Financial
Officer) will commence at 9.00am London time on 20 October and can
be accessed on https://www.ihgplc.com/investors/2017-third-quarter-trading-update
There will be an opportunity to ask
questions.
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International
dial-in
Standard
US dial-in
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+44 (0)
20 3059 8125
+1 7249
289 460
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Passcode
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IHG
Investor
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A
replay of the 9.00am conference call will be available following
the event - details are below:
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International
dial-in
Standard
US dial-in
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+44 (0)
121 260 4861
+1 844
2308 058
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Replay
pin
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7171574#
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US conference call and Q&A:
There
will also be a conference call, primarily for US investors and
analysts, at 9.00am New York Time on 20 October with Paul
Edgecliffe-Johnson (Chief Financial Officer). There will be an
opportunity to ask questions.
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International
dial-in
Standard
US dial-in
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+44 (0)
20 3059 8125
+1 7249
289 460
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Passcode
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IHG
Investor
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A
replay of the 9.00am US conference call will be available following
the event - details are below:
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International
dial-in
Standard
US dial-in
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+44 (0)
121 260 4861
+1 844
2308 058
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Replay
pin
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7172527#
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Website:
The full release and supplementary data will be available on our
website from 7.00am (London time) on 20 October. The web address
is www.ihgplc.com/investors/results-and-presentations
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IHG® (InterContinental Hotels Group) [LON:IHG, NYSE:IHG (ADRs)] is a global
organisation with a broad portfolio of hotel brands,
including InterContinental® Hotels
& Resorts,
Kimpton® Hotels
& Restaurants,
Hotel
Indigo®,
EVEN®
Hotels, HUALUXE® Hotels and
Resorts, Crowne Plaza® Hotels &
Resorts, Holiday
Inn®, Holiday Inn
Express®,
Holiday Inn Club
Vacations®,
Holiday Inn
Resort®,
avid™
hotels, Staybridge Suites®
and Candlewood
Suites®.
IHG franchises, leases, manages or owns nearly 5,300 hotels and
more than 785,000 guest rooms in almost 100 countries, with more
than 1,500 hotels in its development pipeline. IHG also
manages IHG® Rewards
Club, our global loyalty
programme, which has more than 100 million enrolled
members.
InterContinental Hotels Group PLC is the Group's holding company and is
incorporated in Great Britain and registered in England and Wales.
More than 350,000 people work across IHG's hotels and corporate
offices globally.
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.ihgplc.com/media
and follow us on social media
at: www.twitter.com/ihg,
www.facebook.com/ihg
and www.youtube.com/ihgplc.
Cautionary note regarding forward-looking statements:
This
announcement contains certain forward-looking statements as defined
under United States law (Section 21E of the Securities Exchange Act
of 1934) and otherwise. These forward-looking statements can
be identified by the fact that they do not relate only 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. These statements are based on assumptions and
assessments made by InterContinental Hotels Group PLC's management
in light of their experience and their perception of historical
trends, current conditions, expected future developments and other
factors they believe to be appropriate. 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. The main factors that could
affect the business and the financial results are described in the
'Risk Factors' section in the current InterContinental Hotels Group
PLC's Annual report and Form 20-F filed with the United States
Securities and Exchange Commission.
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InterContinental Hotels Group PLC
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(Registrant)
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By:
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/s/ F. Cuttell
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Name:
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F.
CUTTELL
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Title:
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ASSISTANT
COMPANY SECRETARY
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Date:
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20 October 2017
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