Annual Report

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Summary of our

Annual Report and Form 20-F 2019

Annual Report
and Form 20-F 2019

Summary of our Annual
Report and Form 20-F 2019

An overview of 2019

Our business and achievements for the year.

From the Chair

Patrick Cescau, Chair

Over the past two years, our transformation has sparked the change needed to take IHG to the next level in terms of our capability and growth aspirations."

Patrick Cescau
Chair

Chair’s statementPDF 74KB

From the CEO

Keith Barr, Chief Executive Officer

In 2019, we have taken more important steps to be the best long-term partner for owners, a great place to work for employees, and a brand of choice for guests ."

Keith Barr
Chief Executive Officer

CEO’s reviewPDF 92KB

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Financial highlights

Total revenue

$4,627m

2018: $4,337m (+6.7%)

Revenue from reportable segmentsb

$2,083m

2018: $1,933m (+7.8%)

Operating profit

$630m

2018: $582ma (+8.2%)

Operating profit from reportable segmentsb

$865m

2018: $832ma (+4.0%)

Total gross revenue in IHG's Systemb

$27.9bn

2018: $27.4bn (+1.8%)

Basic EPSc

210.4¢

2018: 183.7¢a (+15%)

Global RevPAR

-0.3%

2018: +2.5%

Dividend per share

125.8¢

2018: 114.4¢ (+10%)

a Restated to reflect the adoption of IFRS 16 (see pages 146 to 149) in the Group Financial Statements.

b Use of Non-GAAP measures:
In addition to performance measures directly observable in the Group Financial Statements (IFRS measures), additional financial measures (described as Non-GAAP) are presented that are used internally by management as key measures to assess performance. Non-GAAP measures are either not defined under IFRS or are adjusted IFRS figures. Further explanation in relation to these measures can be found on pages 55 to 59 and reconciliations to IFRS figures, where they have been adjusted, are on pages 214, and 218.

cAdjusted EPSb 303.3¢ (+3%); 2018: 293.2¢a

Where we operate

We operate in more than 100 countries globally.

b Use of Non-GAAP measures:
In addition to performance measures directly observable in the Group Financial Statements (IFRS measures), additional financial measures (described as Non-GAAP) are presented that are used internally by management as key measures to assess performance. Non-GAAP measures are either not defined under IFRS or are adjusted IFRS figures. Further explanation in relation to these measures can be found on pages 55 to 59 and reconciliations to IFRS figures, where they have been adjusted, are on pages 214, and 218.
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Our brands

Overview

Mainstream

Global segment

$115bn

Growth potential to 2025

$65bn

Upscale

Global segment

$40bn

Growth potential to 2025

$20bn

Luxury

Global segment

$60bn

Growth potential to 2025

$35bn

Our business model

Through our business model, we predominantly franchise our brands and manage hotels on behalf of third-party hotel owners. As an asset-light business, we focus on growing our fee revenues and fee margins, with limited requirements for capital.

4,870

Franchised hotels

(614,974 rooms)

1,007

Managed hotels

(262,253 rooms)

26

Owned and leased hotels

(6,336 rooms)

Our strategy for high-quality growth

Our clearly defined strategy is designed to deliver industry leading net rooms growth over the medium term. We grow our brands in high value markets where we can tap into deep pools of consumer demand to create scale positions and develop a differentiated guest and owner offer.

Our focus is on delivering high-quality growth, which means consistent, sustained growth in cash flows and profits over the long-term. The execution of our strategy is underpinned by a clear commitment to operate a responsible business.

Our culture, key stakeholders and doing business responsibly

Our focus on doing business responsibly and the way we interact with our stakeholders, helps create a diverse, healthy and inclusive culture. IHG’s purpose and strategy go beyond a simple hotel stay and shareholder returns; it also includes the impact we have on the environment and the communities we work in.

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