InterContinental Hotels Group PLC (IHG) 2005 Q1 法說會逐字稿

Thank you for standing by and welcome to the InterContinental Hotels Group Q1 results conference call. [OPERATOR INSTRUCTIONS]. I would now like to hand the conference over to your speaker today, Andy Cosslett. Please go ahead, sir.

Thank you. Well, good morning everybody. This is Andy Cosslett, Chief Executive of the InterContinental Hotels Group. I'm joined today by our Finance Director, Richard Solomons. Now, we realize this is only a first quarter update, so we will try not to keep you too long.

I'll hand over to Richard now, to go through the financial highlights, and I will then come back and focus on the business performance, after which we'll be happy to take any questions you may have. So over to Richard.

Thanks, Andy, and good morning everybody. As you can see, this is the first set of results that we've reported under the new International Financial Reporting Standards.

Hotels operating profit is up from £46m to £65m. Even allowing for no depreciation charged on assets held for sale under IFRS, Hotels operating profit is up 9%. Our managed and fee based income, also up 9%, was led by a strong performance in the U.S. This is an increasingly important figure, as we move to focus even further onto the management and franchise business model.

Our Americas region continued to show strong growth, with RevPAR up 7.6%, driven principally by rate. InterContinental is outperforming, while the Holiday Inn brand family maintained a significant RevPAR premium to their market segment in the period. Within this key Americas market, we also signed an encouraging 93 new franchise deals in the quarter, compared to 57 in the same period last year.

The U.K. hotels have delivered a strong performance, showing the progress the Holiday Inn brand is making in this market, with RevPAR up 6.4% in London and 4.9% in the regions, well ahead of the market. The U.K. is an important market for Holiday Inn, so this out-performance is encouraging, as it has been achieved through an increased focus on the business customer.

And finally, including our announcement yesterday of the sale of the Crowne Plaza United Nations in New York for $34m, we've now sold 123 hotels for proceeds of £1.78b, with 22 hotels remaining on the market with a net book value of £420m. Thank you. I'll now hand you back to Andy.

Thanks, Richard. Well, in the quarter we saw RevPAR growth in all three of our regions, with Americas and the Asia Pacific region showing the strongest growth, which was mainly rate driven. As with the rest of the industry, we found trading in Continental Europe something of a mixed bag.

We've seen strong performances right across our brand portfolio, and in particular in the Holiday Inn brand in the U.K. And in the U.S.A., as Richard said, the InterContinental brand, but also Staybridge and Candlewood brands in our extended stay segment.

Looking at China, which as you know, is a major focus for InterContinental Hotels Group, this has now reached a total of 48 hotels which are open in this market, and we have 29 in the pipeline. During the quarter, we saw solid growth in performance, driven again by rates, and good performance across our range of brands, particularly InterContinental, Holiday Inn and Crowne Plaza.

In the quarter, we opened 8,500 new rooms and added a further 12,000 rooms to our pipeline. So our total pipeline now stands at over 85,000 rooms, which is an all-time high for this Company. Membership of our loyalty scheme, Priority Club Rewards, now stands at over 24m worldwide. And separately, bookings through our own branded website continues to grow healthily, up 7 percentage points year-on-year.

These are important developments, as they enhance our business offer to hotel owners and our franchisee community, and obviously we're going to continue to try and work hard in these areas on their behalf.

Our asset disposal program is progressing well. We're now actually able to increase more of our time and focus on looking at how best to position this Company against our future profile, which is in managed and franchised hotels.

Overall, we conclude that we've had a positive start to the year, and believe that we have many further opportunities to build this business on what has clearly been a very solid platform in quarter 1.

That's all we wish to say at this point. Richard and I are very happy to take any questions that you may have. Leah, if you'd like to ask for any?

[OPERATOR INSTRUCTIONS]. Your first question comes from Smedes Rose. Please go ahead.

Hi. This is Smedes Rose at Calyon. Of your 85,000-room pipeline, how much of that is for North America?

Hello, Smedes, this is Andy Cosslett. We are reporting 58,600 rooms in the pipeline in America, so clearly the majority of rooms. So 58,600 out of 85,200.

Thank you.

Pleasure.

[OPERATOR INSTRUCTIONS]. The next question comes from David Richter. Please go ahead.

It's Dave Richter from ABP, just actually a follow up on the pipeline question. How do you define rooms in your pipeline? Are they under contract or do you assign some sort of probability to them getting done?

Yes, they are signed under contract rooms. There's a lot more we are talking to people about, or we sign letters of intent, but those would not be included in the pipeline.

Okay, great. Thank you.

Pleasure.

[OPERATOR INSTRUCTIONS]. There are no further questions at this time. Please continue.

Okay. Well, thanks very much everybody and thanks for your time and interest in the Company. Hopefully speak to you again in September. Thank you.

Thanks.

That does conclude our conference for today. Thank you for participating. You may all disconnect.