We use a number of key performance indicators (KPIs) to measure the performance of our business and report quarterly on them. They are:
- System size – the number of hotels/rooms operating under IHG brands
- Development pipeline – the number of hotels/rooms signed up to enter the IHG system at a future date.
- RevPAR – revenue per available room
- Reservation channel revenue – the revenue delivered by our call centres, websites and GDS
- Priority Club Rewards revenue – revenue generated from PCR members booking through our reservation channels or direct with hotels.
System size
Room count, ‘000 rooms
2001 – 2008
In the twelve months to 31 December 2008, there was a net increase of 34,757 in the number of rooms operating under our brands.
- 59,353 total rooms opened
- 17,362 room additions were from Holiday Inn Express, 10,212 from Crowne Plaza and 3,974 from InterContinental.
Development pipeline
We have the largest pipeline of new rooms of any of our major competitors.
A new property only enters the pipeline once a contract has been signed and the appropriate fees paid. In rare circumstances, a hotel will not open for reasons such as the financing being withdrawn. This typically affects around 10% of the rooms in the pipeline.
Pipeline 2000 – December 2008
RevPAR
Brand RevPAR (rooms revenue per available room) is an important driver of our franchise earnings stream and allows us to judge how our brands are performing against those of our competitors. The segment data is produced by Smith Travel Research.
Americas – RevPAR declined (0.2)% in 2008 with rate growth of 3.6% offset by occupancy declines. In the fourth quarter the industry experienced a sharp deterioration in trading; IHG’s RevPAR declined 7.2% with modest rate growth offset by occupancy declines. In the year, IHG’s brand outperformed their market segments in the US. Continuing revenues grew 2% to $920m. Excluding a $13m liquidated damages receipt in the first quarter, continuing revenues grew 1%.
EMEA – RevPAR increased 3.6% in the year, driven by strong rate growth of 5.4%; in line with the industry RevPAR performance deteriorated in the fourth quarter, declining 5.3%. Throughout the year the Middle East continued to perform strongly, raising RevPAR by 20.2%. IHG hotels in the UK outperformed the market growing RevPAR by 1.2% Continuing revenues grew 5% to $518m driven by 36% growth in franchised revenues. Excluding the two liquidated damages receipts totalling $16m, continuing revenues grew 2%.
APAC – RevPAR increased 1.6%. Strong rate and occupancy growth in the first nine months of the year was partly offset by a 6.1% decline in RevPAR in the fourth quarter with most sub-regions impacted by the weaker global economy. Greater China RevPAR declined 14% in the fourth quarter due partly to the impact of supply increases in the major cities. Continuing revenues grew 12% (10% CER) to $290m driven by 10% growth in owned and leased revenues and 14% growth in managed revenues. Excluding a $4m liquidated damages receipt in the third quarter from one contract, franchised revenues were down $2m to $14m.
Comparable RevPAR 12 months to 31 December 2008
Market performance data sources: Smith Travel Research
Reservation channel revenue
The performance of our reservation channels and loyalty programme is an important measure for us to know that we are delivering value to our franchisees.
- In 2008, 48% of rooms revenue for all hotels in the system was booked through our reservations channels. This represents $7.6 billion of bookings.
- Internet bookings represented 20% of this total, up from 17% in 2007.
Reservation channel revenue, $bn
IHG channels deliver 48% of total hotel room revenue – up from 45% in 2007
Priority Club Rewards revenue, $bn
PCR members contribute 37% of rooms nights – and this is rising
Last updated 17 Feburary 2009
