In preparation for IHG's Q3 2011 earnings release Tuesday morning, we’ve put together the recent pertinent forward looking company commentary.



IHG Shares GLobal Repositioning Strategy for Crowne Plaza Hotels & Resorts (10/25/11) 

  • "Crowne Plaza is a top priority for IHG, and the time is now to differentiate the brand from its competitors in a meaningful and relevant way."
  • 3 phases repositioning strategy:
    • Phase 1 (Freshen Up) Now - 2012:  "Focus on raising product quality and consistency, primarily in the Americas, driving revenue and performance across the portfolio, refreshing the Sleep Advantage program in the Americas and launching a new brand identity with a modern look and feel."
    • Phase 2 (Move Up) 2012-2013: "New global branded service training program, development and distribution in major gateway cities and resort markets, increasing trial and brand awareness, and delivering on key drivers of guest satisfaction."
    • Phase 3 (Shine) 2013-2015: Testing of new brand hallmarks



  • "Our reported EBIT margins are already significantly ahead of our peers, 27% last year compared to 23% for Marriott and 20% for Starwood."
  • “We are committed to maintain an investment grade credit rating through the cycle, which we consider to be 2.0 to 2.5 times net debt to EBITDA. We currently stand at a trailing last 12 months ratio of 1.4 times, giving ample headroom.”
  • "July RevPAR was up almost 6% with a further improvement in rate growth to 2.7%. U.S. RevPAR was up almost 7% with more than half of the growth driven by rate. On a total basis, our U.S. RevPAR grew over 8% once again outperforming the Smith Travel industry data."
  • "In terms of system size, we still expect modest growth this year even after the expected exit in the second-half of the almost 7,000 rooms relating to the HPT management contract. In future years, the level of removables should revert to historic norms and this in turn should mean annual net systems growth of between 3% and 5% over the medium-term."
  • "Visibility hasn’t really changed… visibility remains quite short.”
  • "We’re seeing quite good performance in the UK, particularly in London actually."
  • “We’ve now got about a quarter of our business on to dynamic pricing, which we think is much more beneficial to the hotels and to customers and, in fact, one of the key focuses there is rather than talking absolutely about rates, people tend to talk about rate and rate growth – what we are actually seeing is big market share gains.”
  • “I do think clearly with the share price down if you were to do buybacks, it’s a lot better at £10 than it was at £14. But I also think just given the uncertainty out there right now, it’s sensible just to wait and see what happens. So, that’s what we’ll do.”
  • [Pipeline reduction impact] “We're more skewed to midscale, and we’re more skewed to non-U.S. where there has been much less of an impact.”
  • “Overall our pipeline is about 40% under construction. In U.S. it’s below 25% under construction.”
  • “Our pipeline still remains at around 16% of the world’s global branded pipeline, which is still significantly ahead of any of our competitors.”
  • “The total demand for room nights in July... it’s going to be well over 100 million room nights for the industry, which will be a record ever for room nights sold in the U.S.  So it is important to put that in context and also obviously think about emerging markets where we’re seeing very strong growth, but the point is, we’re seeing it both across leisure and business travel.”
  • "60% of the pipeline is financed." 
  • "Supply growth is very low, but there is growth in midscale."
  • "Cash flow in the second half –  there will be some reversal of the outflow that we saw in the first half clearly as business ramps-up – if it continues to ramp-up, observe some working capital with effectively receivables growing. Days sales outstanding hasn’t been growing but the quantum has been growing as the business ramps up. But overall, we expect cash to be broadly neutral for the full year, barring any major disposals."
  • [Depreciation charge] “Three (million) in the second half.”

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