Full Year 2024 InterContinental Hotels Group PLC Earnings Call Transcript
Key Points
- InterContinental Hotels Group PLC (IHG) reported a 3% growth in RevPAR, with momentum improving across all regions in Q4.
- The company achieved gross system growth of 6.2% and net system growth of 4.3%, marking the third consecutive year of accelerating system growth.
- IHG signed 106,000 rooms across 714 hotels, a 34% increase in signings over 2023.
- The company expanded its fee margin by 190 basis points, driven by operating leverage and new ancillary fee agreements.
- IHG completed an $800 million share buyback program and announced a new $900 million buyback program, returning over $1.1 billion to shareholders in 2025.
- In the Americas, fee growth was only up 1% in the second half, despite a 3% increase in RevPAR, due to certain one-time costs.
- In China, while there was a strong year of signings, openings and signings were down in Q4, raising concerns about the development picture.
- The company faces increased competition and costs in the industry, particularly regarding key money, which is expected to remain elevated.
- There is uncertainty regarding the impact of potential US policy changes on employment costs and hotel operations.
- Disruptions from climate change, such as natural disasters, pose ongoing risks to IHG's operations and future signings.
-- take your first question. I will summarize our strong performance.
Our rev bar grew by 3%, with momentum improving across all regions in Q4. We delivered gross system growth of 6.2% and net system growth of 4.3%, representing the third consecutive year of accelerating system growth.
We signed 106,000 rooms across 714 hotels, delivering a 34% increase in signings over 2023. We expanded our fee margin by 190 basis points, driven by 130 basis points of uplift from operating leverage and 60 basis points of uplift from new ancillary fee agreements. EBIT grew 10% and adjusted EPS grew 15%.
We completed our $800 million share buyback program, which together with ordinary dividends, returned over $1 billion to shareholders. And today, we announced the launch of a new $900 million share buyback program, which together with dividend payments, is expected to return over $1.1 billion to shareholders in 2025. And we announced the acquisition of the Ruby brand for $116 million, a premium urban lifestyle brand.
In summary
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