InterContinental Hotels 2004 first Hotels 2004 first - - PowerPoint PPT Presentation

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InterContinental Hotels 2004 first Hotels 2004 first - - PowerPoint PPT Presentation

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InterContinental Hotels 2004 first Hotels 2004 first InterContinental half results half results Richard North Richard North Chief Executive Richard Solomons Solomons Richard Finance Director Finance Director Summary Summary Hotel

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SLIDE 1

InterContinental InterContinental Hotels 2004 first Hotels 2004 first half results half results Richard North Richard North

Chief Executive

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SLIDE 2

Richard Richard Solomons Solomons

Finance Director Finance Director

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SLIDE 3

Summary Summary

Hotel results remain strong Soft drinks continues to grow turnover Interim dividend raised to 4.30p per share £1bn return of funds since separation Special one-off contribution to pension fund of

approximately £50m

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SLIDE 4

6 6 mths mths to to 30 June 04* 30 June 04* Proforma Proforma 6 6 mths mths to to 30 June 03* 30 June 03* Change Change % %

IHG Group IHG Group Profit & Loss Account Profit & Loss Account

Turnover 1,101 1,043 5.6 EBITDA 254 213 19.2 Operating Profit 153 114 34.2 Interest (10) (22) 54.5 Profit before Tax 143 92 55.4 Tax rate 18% 25% Earnings per share 14.2p 7.6p 86.8 Dividend 4.30p 4.05p+ 6.2 £m £m * * Excludes exceptional items

Excludes exceptional items

+ + Interim 2003; 9 months to June 2003

Interim 2003; 9 months to June 2003

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SLIDE 5

Results Results 6 months to 30 June 2004 6 months to 30 June 2004 Hotels Hotels

Turnover Turnover 735 735 708 708 3.8 3.8 Operating Profit Operating Profit 113 113 75 75 50.7 50.7

Soft Drinks Soft Drinks

Turnover Turnover 366 366 335 335 9.3 9.3 Operating Profit Operating Profit 40 40 39 39 2.6 2.6

6 6 mths mths to to 30 Jun 04 30 Jun 04 Proforma Proforma 6 6 mths mths to to 30 Jun 03 30 Jun 03 Change Change % %

£m £m

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SLIDE 6

Hotels Operating Profit Hotels Operating Profit 6 months to 30 June 2004 6 months to 30 June 2004

6 6 mths mths to to 30 Jun 04 30 Jun 04 Proforma Proforma 6 6 mths mths to to 30 Jun 03 30 Jun 03 % %

$m $m

Americas Americas 145 145 131 131 10.7 10.7 EMEA EMEA 91 91 51 51 78.4 78.4 Asia Pacific Asia Pacific 17 17 3 3 466.7 466.7 Central Overheads Central Overheads (47) (47) (63) (63) 25.4 25.4 Total Operating Profit $m Total Operating Profit $m 206 206 122 122 68.9 68.9 Total Operating Profit £m Total Operating Profit £m 113 113 75 75 50.7 50.7 Total EBITDA £m Total EBITDA £m 190 190 152 152 25.0 25.0

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SLIDE 7

Hotels Operating Profit Hotels Operating Profit 3 months to 30 June 2004 3 months to 30 June 2004

Americas Americas 86 86 81 81 6.2 6.2 EMEA EMEA 62 62 31 31 100.0 100.0 Asia Pacific Asia Pacific 7 7 (4) (4)

  • Central Overheads

Central Overheads (30) (30) (32) (32) 6.3 6.3 Total Operating Profit $m Total Operating Profit $m 125 125 76 76 64.5 64.5 Total Operating Profit £m Total Operating Profit £m 69 69 46 46 50.0 50.0 Total EBITDA £m Total EBITDA £m 107 107 84 84 27.4 27.4

3 3 mths mths to to 30 Jun 04 30 Jun 04 Proforma Proforma 3 3 mths mths to to 30 Jun 03 30 Jun 03 % %

$m $m

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SLIDE 8

Owned & Leased Estate Owned & Leased Estate Comparable Comparable RevPAR RevPAR growth for growth for 18 months to 30 June 2004 18 months to 30 June 2004

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SLIDE 9

Americas Operating Profit Americas Operating Profit 6 months to 30 June 2004 6 months to 30 June 2004

Americas

  • Owned & Leased

22 17 29.4

  • Managed

4 5 (20.0)

  • Franchised

148 136 8.8 Total 174 158 10.1 Regional Overheads (29) (27) (7.4) Total Americas Operating profit $m 145 131 10.7 Total Americas Operating profit £m 80 82 (2.4)

6 6 mths mths to to 30 Jun 04 30 Jun 04 Proforma Proforma 6 6 mths mths to to 30 Jun 03 30 Jun 03 % %

$m $m

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SLIDE 10

3 3 mths mths to to 6 6 mths mths to to

RevPAR RevPAR Movement Movement

30 Jun 04 30 Jun 04 30 Jun 04 30 Jun 04

Holiday Inn Holiday Inn 5.3% 5.3% 5.0% 5.0% Express Express 6.3% 6.3% 6.8% 6.8%

6 months to 30 Jun 04 Holiday Inn Holiday Inn Express Express

Change in royalty rate Change in royalty rate (0.02)% pts (0.02)% pts (0.02)% pts (0.02)% pts Change in number of Change in number of (1.0%) (1.0%) 6.2% 6.2% rooms available rooms available

Americas Americas -

  • Franchised Hotels

Franchised Hotels RevPAR RevPAR Movement Movement Operating profit up $12m to $148m Operating profit up $12m to $148m

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SLIDE 11

EMEA Operating Profit EMEA Operating Profit 6 months to 30 June 2004 6 months to 30 June 2004

EMEA

  • Owned & Leased

38 30 26.7

  • Managed

15 8 87.5

  • Franchised

9 8 12.5 Total 62 46 34.8 Regional Overheads (12) (14) 14.3 Total EMEA 50 32 56.3 Total EMEA $m 91 51 78.4

6 6 mths mths to to 30 Jun 04 30 Jun 04 Proforma Proforma 6 6 mths mths to to 30 Jun 03 30 Jun 03 % %

£m £m

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SLIDE 12

3 3 mths mths to to 6 6 mths mths to to

RevPAR RevPAR Movement Movement

30 Jun 04 30 Jun 04 30 Jun 04 30 Jun 04

InterContinental InterContinental 8.5% 8.5% 4.0% 4.0% Crowne Crowne Plaza Plaza 9.8% 9.8% 7.5% 7.5% Holiday Inn Holiday Inn 9.3% 9.3% 8.6% 8.6% HIUK London HIUK London 27.7% 27.7% 22.3% 22.3% HIUK Regions HIUK Regions 5.3% 5.3% 6.7% 6.7%

EMEA EMEA -

  • Owned & Leased

Owned & Leased Comparable Comparable RevPAR RevPAR Movement Movement O&L Operating profit up £8m to £38m O&L Operating profit up £8m to £38m

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SLIDE 13

Asia Pacific Operating Profit Asia Pacific Operating Profit 6 months to 30 June 2004 6 months to 30 June 2004

Asia Pacific

  • Owned & Leased

13 6 14 (7.1)

  • Managed

12 4 9 33.3

  • Franchised

2 2 3 (33.3) Total 27 12 26 3.8 Regional Overheads (10) (9) (9) (11.1) Total Asia Pacific 17 3 17

  • Total Asia Pacific £m

9 1 11 (18.2)

6 6 mths mths to to 30 Jun 04 30 Jun 04 6 6 mths mths to to 30 Jun 03 30 Jun 03 6 6 mths mths to to 30 Jun 02 30 Jun 02

$m $m

% (04 v 02) % (04 v 02)

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SLIDE 14

Capital Expenditure Capital Expenditure continues to be controlled continues to be controlled

Spend continues to

trend downwards

Forecast for 2004

reduced to £250m

Britvic expected spend

remains at £80m

Hotels Capex Spend, £m, 2001 - 2004F 100 200 300 400 500 600 700 2001A 2002A 2003A 2004F (old) 2004F (new)

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SLIDE 15

Soft Drinks Soft Drinks 6 months to June 30 2004 6 months to June 30 2004

Volume up 7.7% as all major brands

perform strongly and gain share

Turnover up 9.3% to £366m Operating Profit up 2.6% to £40m

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SLIDE 16

IHG Group IHG Group Cash Flow Cash Flow

6 6 mths mths to to 30 Jun 04 30 Jun 04

Operating Profit 153 114 Depreciation/Amortisation 101 99 Working capital/other (20) 25 Capital expenditure (109) (158) Cash flow before disposals 125 80 Disposals 88 18 Operating cash flow 213 98 £m £m

Proforma Proforma 6 6 mths mths to to 30 Jun 03 30 Jun 03

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SLIDE 17

Exceptional Items Exceptional Items 6 months to 30 June 2004 6 months to 30 June 2004

£m FelCor carrying value adjustment 6 Profit on disposal of assets 18 Exceptional interest 6 Tax on exceptional items (3) Exceptional tax credit 138

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SLIDE 18

IHG Group Balance Sheet IHG Group Balance Sheet

£ £m m

30 Jun 04 30 Jun 04 30 Jun 03 30 Jun 03

Tangible assets Tangible assets 3,892 3,892 4,456 4,456 Intangible assets Intangible assets 147 147 157 157 Working capital Working capital 9 9 (54) (54) Long Long-

  • term liabilities

term liabilities (160) (160) (216) (216) Net operating assets Net operating assets 3,888 3,888 4,343 4,343 Net debt Net debt (520) (520) (942) (942) Other non Other non-

  • operating liabilities
  • perating liabilities

(731) (731) (870) (870) Net assets Net assets 2,637 2,637 2,531 2,531

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SLIDE 19

Return of Funds Return of Funds

£213m of initial share buyback programme

complete, £37m remaining

Special Dividend of £500m with associated

share consolidation to be paid in December 2004

Further Buyback of £250m once existing

programme completes £1bn Return of Funds £1bn Return of Funds

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SLIDE 20

Summary Summary

Hotel results remain strong Soft drinks continues to grow turnover and profit Interim dividend raised to 4.30p per share £1bn return of funds since separation Special one-off contribution to pension fund of £50m

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SLIDE 21

Richard North Richard North

Chief Executive

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SLIDE 22

The highlights of today The highlights of today’ ’s s announcement . . . announcement . . .

Brand performance and system delivery continue to grow strongly Focused strategy based on key strengths: Grow brands Develop managed & franchised business Additional asset disposals Further £750m return as part of ongoing programme;

£1bn announced to date

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SLIDE 23

At Separation we laid out a clear At Separation we laid out a clear strategy strategy

Develop high quality, strongly differentiated brands Extend network of hotels through largely capital free

franchise and management contracts and only very selectively through ownership where returns are high

Significantly reduce capital intensity to drive up returns Leverage global system scale economies to drive RevPAR

and reduce operating cost

Continue to develop our people

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SLIDE 24

This strategy was supported by This strategy was supported by an initial set of key actions an initial set of key actions

Redesign organisation Strengthen management Significantly reduce costs Reduce capital expenditure Reduce asset intensity Begin returning funds to shareholders

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SLIDE 25

We have made significant We have made significant progress against these actions progress against these actions

Redesigned organisation Strengthened management Costs significantly reduced Capital Expenditure in 2003 half of that of 2001 Assets sales programme commenced Capital return programme commenced

and

New Pepsi bottling agreement and intent to IPO Britvic

We see this as Phase 1 in the transformation of IHG We see this as Phase 1 in the transformation of IHG

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SLIDE 26

We are aiming to exploit We are aiming to exploit

  • ur competitive advantages
  • ur competitive advantages

still more still more

Brand portfolio management and creation Franchising excellence Hotel management skills Reservation system delivery and loyalty scheme operation Scale where it matters in top hotel markets

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SLIDE 27

As a result, we have been able to As a result, we have been able to add further detail to our strategy add further detail to our strategy

Become world’s leading hotel brand owner Become mostly franchised and managed Exploit our US scale and geographic presence to build national

scale in world’s major markets

Grow InterContinental brand by exploiting national scale

economies

Sustain lower operating costs through focused operations

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SLIDE 28

Phase II: 5 key priorities for Phase II: 5 key priorities for 2004 onwards 2004 onwards

Driving ROCE is the key metric by which we will measure success Driving ROCE is the key metric by which we will measure success

Strengthen core business Grow managed and franchised fee income Develop people and organisation Continue to execute asset disposal programme Return funds to shareholders Become the world’s leading hospitality brand owner

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SLIDE 29

Build strong, differentiated brands Increase system delivery to strengthen franchisee offer Strengthen hotel management skills Selective new brand innovation: Candlewood, Indigo,

brand extensions

Strengthen Core Business Strengthen Core Business

Key actions to Strengthen our core business

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SLIDE 30

1309 1525 300 500 700 900 1100 1300 1500 1700 2003 2004E 1636 2067 300 500 700 900 1100 1300 1500 1700 1900 2100 2300 2003 2004

Strengthen Core Business

System delivery strengthens, System delivery strengthens, supporting our pipeline growth supporting our pipeline growth

PCR total revenue, $m, H1 2003 – 2004 Reservation channel revenue, $m, H1 2003 – 2004 26.3% growth versus US market growth of 8.2% 16.5% growth versus US market growth of 8.2%

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SLIDE 31

Strengthen Core Business

We continue to make progress We continue to make progress with new brands: Indigo with new brands: Indigo

Indigo Guest Bedroom and Lobby mock up

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SLIDE 32

Strengthen Core Business

We continue to make progress with We continue to make progress with acquired new brands: Candlewood acquired new brands: Candlewood

Candlewood:

Top performer in

JD Power survey

Pipeline of almost

2,500 rooms

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SLIDE 33

Grow Managed and Franchise Income

Key actions to Grow managed and franchised fee income

Significant potential to grow upscale worldwide Potential to grow midscale to build depth positions in a

small number of key markets

Leverage leading market positions in US, UK, China

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SLIDE 34

Grow Managed and Franchise Income

We are growing our pipeline and system additions

Pipeline size by key country Gross system additions of

almost 13,000 rooms

Net 2,589 rooms due to

planned Holiday Inn terminations and O&L disposals

Pipeline growth of 8% year

  • n year

75% of pipeline in key focus

countries:

Grown at 10% since start of

year

10,000 20,000 30,000 40,000

All other UK Mexico US Upscale China US Midscale

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SLIDE 35

Complete delivery of target overhead savings Contain or reduce costs through actions such as:

simplification of structure due to focus reduce costs of asset ownership processing improvement

Focus on strengthening our people’s skills

Develop our people and organisation Develop our people and organisation

Key actions to Develop our people and organisation

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SLIDE 36

Continue the execution of asset disposal programme

Capital reduction continues with Capital reduction continues with £ £2.2bn 2.2bn

  • f assets sold or announced for disposal
  • f assets sold or announced for disposal

Started at Separation with £3.9bn of hotels Currently more than £900m on market or disposed Announce today a further tranche with net book value of

£1.3bn, predominantly in the UK plus InterContinental Paris

Moving through disposal programme as assets and

markets are ready Sales prices slightly ahead of net book value achieved Sales prices slightly ahead of net book value achieved

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SLIDE 37

Current Progress and Highlights:

£213m of the £250m buyback completed at an average price

  • f 534p per share

Announce today:

Special dividend of £500m to be paid in December 2004

with associated share consolidation

Further share buyback of £250m once existing £250m

completes

Return funds to shareholders

Announce today a further Announce today a further £ £750m return to shareholders 750m return to shareholders

£1bn of returns completed or announced to date £1bn of returns completed or announced to date as part of our ongoing programme as part of our ongoing programme

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SLIDE 38

World World’ ’s Leading Hospitality s Leading Hospitality Brand Owner Brand Owner

Predominantly hotel franchising and management business with

high quality (low-cyclicality) earnings and cash generation

World class brands Brand innovator Scale presence in limited number of key markets Much reduced capital invested, versus £3.6 billion today Attractive workplace for talented people

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SLIDE 39

In summary, the highlights of In summary, the highlights of today today’ ’s announcement . . . s announcement . . .

Brand performance and system delivery continue to grow strongly Focused strategy based on key strengths:

Grow brands Develop managed & franchised business

Additional asset disposals Further £750m return as part of ongoing programme;

£1bn announced to date

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SLIDE 40

Current Trading Current Trading

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SLIDE 41

Current Trading Current Trading and Outlook and Outlook

Trading remains strong in our key profit regions Strong occupancy growth across all brands Room-rate growth has begun in key urban locations European market remains weak, with Paris in

particular very depressed and hard to predict

Booking lead times remain short

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SLIDE 42

Supplementary Information

30th June 2004

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SLIDE 43

Index

1. RevPAR - 3 months to 30 June 2004

  • 1. Owned/Leased Comparable & Managed
  • 2. Franchised & Total System
  • RevPAR - 6 months to 30 June 2004

Owned/Leased Comparable & Total Franchised & Total System

  • Current Trading

RevPAR Occupancy Average Daily Rate

  • System Size

Total System Size at 30 June 2004 Total System Size Change from 31 December 2003

  • Pipeline

Total Pipeline at 30 June 2004 Total Pipeline Change from 31 December 2003

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SLIDE 44

Explanatory Notes

  • We have disclosed Owned and Leased RevPAR on a

comparable basis.

  • Owned and Leased comparable RevPAR reflects performance

this year compared to the same period last year for Owned and leased hotels that have traded in both years, but excludes new builds, brand changes, properties under major refurbishment and disposals.

  • All RevPAR data is quoted at a constant US$ conversion rate to

avoid distortions created by fluctuations in the year on year exchange rate.

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SLIDE 45

RevPAR – 3 Months to 30 June 2004 Owned/Leased Comparable & Managed

1.1 RevPAR 3 months

Owned & Leased Managed

Occ % ADR RevPAR Occ % ADR RevPAR

2004 Pts 2004 Growth 2004 Growth 2004 Pts 2004 Growth 2004 Growth InterContinental 74.1% 5.4% 169.24 6.0% 125.38 14.3% 55.7% 9.4% 124.57 4.7% 69.39 25.8% Crowne Plaza 79.7% 4.4% 109.76 5.1% 87.46 11.2% 69.6% 9.0% 108.11 6.5% 75.20 22.4% Holiday Inn 73.7% 4.7% 76.34 2.8% 56.29 9.8% 67.7% 2.2% 78.00 2.1% 52.84 5.6% Express

  • 71.7%

12.7% 90.39 5.2% 64.85 27.7% Staybridge Suites 75.8% 1.9% 90.12 4.8% 68.31 7.5% 77.2% 7.9% 87.26 29.4% 67.33 44.0% Candlewood Suites

  • 70.3%
  • 57.72
  • 40.58
  • Total Americas

75.4%

4.8%

126.14

5.5%

95.17

12.6%

67.6%

6.7%

90.38

4.4%

61.14

15.9%

InterContinental 68.6% 5.9% 222.10 (0.9%) 152.43 8.5% 59.7% 8.4% 124.51 (6.5%) 74.35 8.8% Crowne Plaza 75.3% 5.4% 124.50 1.9% 93.74 9.8% 72.7% 9.7% 113.17 5.1% 82.29 21.2% Holiday Inn 70.6% 2.4% 113.12 5.6% 79.85 9.3% 61.1% 10.7% 66.69 (7.1%) 40.73 12.6% Express 62.8% (0.2%) 78.05 10.0% 49.04 9.6% 52.2% (8.4%) 79.48 10.7% 41.51 (4.6%)

Total EMEA

70.6%

3.3%

132.20

4.0%

93.34

9.1%

62.6%

9.2%

106.82

(4.9%)

66.87

11.4%

InterContinental 72.1% 45.2% 190.93 38.1% 137.70 270.4% 69.7% 23.8% 133.75 (5.8%) 93.17 43.0% Crowne Plaza 83.1% 7.6% 106.01 3.4% 88.06 13.8% 70.4% 22.4% 73.37 3.1% 51.62 51.1% Holiday Inn 80.6% 3.8% 85.78 3.0% 69.16 8.0% 72.9% 29.3% 60.51 11.0% 44.10 85.8% Express

  • 53.3%

(0.7%) 71.82 7.8% 38.31 6.5% Other

  • 64.4%

7.4% 66.92 (4.7%) 43.08 7.7%

Total Asia Pacific

79.0%

15.5%

115.95

22.0%

91.64

51.8%

71.2%

25.4%

79.46

0.7%

56.61

56.7%

Note: Americas total line does not include Candlewood as no prior year comparable numbers

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SLIDE 46

RevPAR – 3 Months to 30 June 2004 Franchised & Total

1.2 RevPAR 3 months

Franchised Total

Occ % ADR RevPAR Occ % ADR RevPAR

2004 Pts 2004 Growth 2004 Growth 2004 Pts 2004 Growth 2004 Growth InterContinental 56.9% 4.6% 101.10 (1.7%) 57.55 7.0% 61.3% 6.4% 132.67 2.8% 81.38 14.7% Crowne Plaza 64.1% 2.8% 89.70 (1.3%) 57.48 3.2% 66.3% 4.2% 95.41 0.7% 63.28 7.5% Holiday Inn 63.4% 1.9% 81.01 2.2% 51.34 5.3% 63.9% 1.9% 80.66 2.2% 51.51 5.4% Express 67.9% 1.9% 75.37 3.4% 51.19 6.3% 67.9% 1.9% 75.44 3.4% 51.26 6.4% Staybridge Suites 73.2% 6.9% 86.52 3.0% 63.31 13.7% 75.3% 6.4% 87.11 4.0% 65.63 13.6% Candlewood Suites 71.1%

  • 63.85
  • 45.40
  • 70.5%
  • 59.44
  • 41.93
  • Total Americas

64.9%

2.1%

80.04

2.3%

51.96

5.7%

65.4%

2.6%

82.45

2.7%

53.95

6.8%

InterContinental 48.4% (13.0%) 136.24 19.0% 65.93 (6.1%) 60.7% 7.0% 156.24 (1.4%) 94.87 11.4% Crowne Plaza 62.7% 2.7% 127.13 0.9% 79.74 5.6% 68.3% 4.6% 121.96 1.7% 83.28 9.1% Holiday Inn 66.4% 3.9% 94.73 4.6% 62.89 11.1% 67.0% 4.4% 97.29 3.5% 65.17 10.8% Express 71.7% 9.4% 89.73 (0.9%) 64.34 14.0% 69.6% 7.3% 88.77 0.4% 61.80 12.0%

Total EMEA

66.7%

4.6%

97.94

2.8%

65.32

10.3%

66.4%

5.4%

109.62

1.2%

72.78

10.1%

InterContinental 62.1% 1.6% 120.59 (9.2%) 74.93 (6.7%) 68.0% 18.7% 135.74 (1.6%) 92.36 35.6% Crowne Plaza 75.6% 7.0% 93.81 (3.5%) 70.94 6.3% 72.1% 18.1% 79.60 (1.6%) 57.41 31.3% Holiday Inn 70.9% 12.5% 60.65 4.2% 42.98 26.5% 72.7% 22.9% 62.71 5.6% 45.62 54.0% Express 61.1% 0.2% 57.23 (3.5%) 34.96 (3.2%) 57.9% (0.7%) 62.70 1.8% 36.32 0.7% Other 77.1% 11.7% 58.49 2.1% 45.08 20.4% 62.3% 2.8% 64.39 (5.2%) 40.09 (0.8%)

Total Asia Pacific

69.6%

8.5%

82.35

(9.6%)

57.31

2.9%

71.2%

20.0%

82.84

(1.3%)

58.97

37.2%

Note: Americas total line does not include Candlewood as no prior year comparable numbers

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SLIDE 47

RevPAR – 6 Months to 30 June 2004 Owned/Leased Comparable & Managed

2.1 RevPAR 6 months

Owned & Leased Managed

Occ % ADR RevPAR Occ % ADR RevPAR

2004 Pts 2004 Growth 2004 Growth 2004 Pts 2004 Growth 2004 Growth InterContinental 69.8% 3.2% 167.54 4.9% 116.87 10.0% 54.7% 8.7% 121.52 0.8% 66.44 19.9% Crowne Plaza 75.0% 4.1% 104.11 3.6% 78.11 9.6% 66.9% 8.3% 104.89 2.6% 70.19 17.2% Holiday Inn 74.8% 6.1% 80.00 3.9% 59.87 13.1% 64.9% 2.3% 76.98 0.7% 49.96 4.4% Express

  • 59.1%

2.4% 83.67 3.7% 49.41 8.1% Staybridge Suites 70.8% 0.8% 89.43 5.4% 63.33 6.5% 72.9% 21.7% 87.10 28.6% 63.49 83.0% Candlewood Suites

  • 68.0%
  • 56.50
  • 38.44
  • Total Americas

72.4%

4.1%

123.98

4.1%

89.79

10.3%

64.8%

6.1%

88.96

2.3%

57.64

13.0%

InterContinental 63.9% 3.7% 209.04 (2.1%) 133.60 4.0% 59.1% 7.2% 127.32 (3.9%) 75.20 9.4% Crowne Plaza 72.1% 5.0% 124.37 0.1% 89.68 7.5% 71.6% 8.4% 112.47 7.8% 80.48 22.1% Holiday Inn 67.8% 2.8% 111.74 4.1% 75.81 8.6% 58.7% 8.1% 67.71 (5.5%) 39.77 9.5% Express 62.6% 2.4% 77.41 2.5% 48.46 6.6% 43.1% (2.0%) 78.86 12.8% 34.00 7.8%

Total EMEA

67.6%

3.3%

128.55

1.9%

86.84

7.1%

61.2%

7.5%

108.69

(2.3%)

66.52

11.4%

InterContinental 71.1% 26.6% 193.57 8.7% 137.66 73.6% 69.0% 17.2% 130.17 (6.1%) 89.87 25.0% Crowne Plaza 84.6% 7.1% 113.17 4.1% 95.79 13.7% 67.9% 12.6% 72.78 1.8% 49.40 24.9% Holiday Inn 78.5% (0.1%) 86.86 2.9% 68.18 2.7% 72.5% 16.0% 59.67 7.6% 43.25 38.2% Express

  • 51.6%

(3.0%) 68.35 3.6% 35.27 (2.0%) Other

  • 70.0%

8.5% 69.84 (11.1%) 48.86 1.2%

Total Asia Pacific

78.1%

8.6%

119.14

11.6%

93.07

25.4%

70.3%

14.9%

78.37

1.1%

55.10

28.4%

Note: Americas total line does not include Candlewood as no prior year comparable numbers

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SLIDE 48

RevPAR – 6 Months to 30 June 2004 Franchised & Total

2.2 RevPAR 6 months

Franchised Total

Occ % ADR RevPAR Occ % ADR RevPAR

2004 Pts 2004 Growth 2004 Growth 2004 Pts 2004 Growth 2004 Growth InterContinental 58.8% 6.4% 106.46 (3.2%) 62.56 8.6% 60.4% 6.2% 132.03 0.4% 79.71 12.0% Crowne Plaza 63.3% 3.1% 90.46 (1.4%) 57.22 3.6% 64.9% 4.3% 94.79 (0.3%) 61.50 6.8% Holiday Inn 59.9% 1.8% 79.33 2.0% 47.54 5.0% 60.5% 1.8% 79.11 1.9% 47.87 5.1% Express 63.5% 2.2% 73.96 3.1% 46.97 6.8% 63.5% 2.2% 74.01 3.1% 46.99 6.8% Staybridge Suites 69.7% 3.9% 86.40 3.9% 60.25 10.0% 71.4% 3.8% 86.94 4.5% 62.08 10.4% Candlewood Suites 67.3%

  • 62.87
  • 42.33
  • 67.8%
  • 58.22
  • 39.50
  • Total Americas

61.4%

2.1%

78.83

2.0%

48.41

5.7%

62.0%

2.5%

81.24

2.2%

50.37

6.5%

InterContinental 52.3% (14.3%) 137.18 15.3% 71.75 (9.5%) 59.2% 4.8% 152.49 (0.8%) 90.30 8.0% Crowne Plaza 58.6% 3.7% 122.44 (0.7%) 71.71 6.0% 65.4% 4.6% 119.83 1.5% 78.42 9.2% Holiday Inn 63.0% 3.0% 92.33 1.9% 58.19 6.9% 63.8% 3.5% 95.54 1.7% 60.96 7.6% Express 66.2% 6.4% 90.36 0.5% 59.85 11.2% 64.6% 5.1% 89.13 1.0% 57.60 9.7%

Total EMEA

63.0%

3.4%

96.14

1.3%

60.53

7.2%

63.3%

4.2%

108.10

0.6%

68.45

7.6%

InterContinental 64.0% (4.5%) 117.62 (10.6%) 75.27 (16.5%) 68.0% 11.0% 132.62 (4.0%) 90.16 14.6% Crowne Plaza 73.8% 4.1% 92.84 (4.9%) 68.53 0.7% 70.0% 10.3% 79.64 (1.6%) 55.75 15.5% Holiday Inn 70.3% 8.0% 60.25 0.9% 42.34 13.7% 72.2% 12.4% 62.19 3.9% 44.89 25.5% Express 63.7% 3.8% 56.68 (0.4%) 36.13 5.9% 58.8% 0.6% 60.86 1.9% 35.78 3.0% Other 78.8% 4.1% 58.46 0.4% 46.07 5.8% 68.7% 4.7% 66.53 (10.7%) 45.71 (4.1%)

Total Asia Pacific

69.4%

3.6%

81.47

(10.8%)

56.58

(5.9%)

70.5%

11.3%

82.17

(2.1%)

57.93

16.6%

Note: Americas total line does not include Candlewood as no prior year comparable numbers

slide-49
SLIDE 49

Current Trading – RevPAR

3.1 Current Trading - RevPAR

CURRENT TRADING 2004 Jan Feb Mar Apr May Jun July Q1 Q2 1st Half YTD

REVPAR % change

July

AMERICAS IC O&L Comparable 2.9% (0.5%) 13.2% 12.5% 16.4% 13.8% 11.4% 5.4% 14.3% 10.0% 10.2% NA Total Crowne Plaza 6.1% 1.2% 9.1% 8.7% 8.5% 9.2% 6.3% 5.7% 8.9% 7.6% 7.4% NA Total Holiday Inn 2.4% 1.8% 8.0% 8.9% 4.9% 5.7% 4.7% 4.3% 6.5% 5.4% 5.3% NA Total Express 6.8% 6.1% 9.6% 8.5% 4.6% 7.1% 5.6% 7.6% 6.7% 7.0% 6.8% EMEA IC O&L Comparable (8.4%) (6.1%) 9.1% 23.6% 4.8% 2.9% (7.8%) (1.4%) 8.5% 4.0% 1.9% HIUK Regions 5.0% 4.2% 14.6% (0.0%) 7.8% 7.6% 4.8% 8.3% 5.3% 6.7% 6.4% HIUK London 6.7% 12.4% 31.3% 37.0% 30.7% 18.6% 17.5% 16.8% 27.7% 22.3% 21.4% ASIA PACIFIC IC O&L Comparable 2004 vs 2003 (13.8%) 12.5% 46.2% 410.5% 340.5% 136.8% 53.7% 12.9% 270.4% 73.6% 70.9% IC O&L Comparable 2004 vs 2002 (9.3%) 30.6% 21.7% 8.8% 18.8% 11.0% 25.3% 12.5% 12.8% 12.7% 14.1%

slide-50
SLIDE 50

Current Trading – Occupancy

3.2 Current Trading - Occupancy

CURRENT TRADING 2004 Jan Feb Mar Apr May Jun July Q1 Q2 1st Half YTD

Occupancy %pts change

July

AMERICAS IC O&L Comparable 1.3% (2.3%) 3.9% 4.6% 6.2% 5.3% 0.7% 1.1% 5.4% 3.2% 2.9% NA Total Crowne Plaza 4.0% 2.5% 6.2% 5.9% 4.6% 4.0% 2.6% 4.4% 4.8% 4.7% 4.5% NA Total Holiday Inn 0.7% 0.1% 4.0% 3.3% 1.5% 2.1% 1.3% 1.6% 2.3% 1.9% 1.8% NA Total Express 1.9% 1.9% 3.9% 2.4% 1.1% 2.5% 1.0% 2.6% 2.0% 2.2% 2.0% EMEA IC O&L Comparable (2.1%) (1.6%) 7.9% 8.1% 3.0% 6.9% (0.2%) 1.5% 5.9% 3.7% 3.2% HIUK Regions 1.1% (1.1%) 3.5% (3.6%) (0.9%) 0.4% (0.1%) 1.3% (1.3%) (0.0%) (0.0%) HIUK London 5.4% 10.0% 16.5% 14.5% 11.9% 8.7% 4.7% 10.6% 11.7% 11.2% 10.2% ASIA PACIFIC IC O&L Comparable 2004 vs 2003 (7.2%) 6.7% 23.7% 51.0% 49.0% 35.5% 14.6% 7.8% 45.2% 26.6% 24.8% IC O&L Comparable 2004 vs 2002 (7.9%) 17.4% 14.6% 5.6% 11.9% 12.5% 15.1% 7.7% 10.1% 8.9% 9.8%

slide-51
SLIDE 51

Current Trading – Average Daily rate

3.3 Current Trading – Average Daily Rate

CURRENT TRADING 2004 Jan Feb Mar Apr May Jun July Q1 Q2 1st Half YTD

ADR % change

July

AMERICAS IC O&L Comparable 0.6% 2.8% 6.8% 5.2% 6.9% 5.9% 10.3% 3.6% 6.0% 4.9% 5.6% NA Total Crowne Plaza (1.4%) (2.7%) (0.7%) (0.9%) 1.0% 3.0% 2.3% (1.5%) 1.1% (0.1%) 0.2% NA Total Holiday Inn 1.0% 1.7% 1.3% 3.2% 2.4% 2.5% 2.8% 1.4% 2.7% 2.1% 2.2% NA Total Express 2.9% 2.7% 3.0% 4.5% 2.9% 3.5% 4.2% 2.9% 3.6% 3.3% 3.4% EMEA IC O&L Comparable (4.9%) (3.6%) (3.8%) 7.7% 0.3% (6.6%) (7.5%) (3.9%) (0.9%) (2.1%) (3.0%) HIUK Regions 2.9% 5.9% 8.6% 5.8% 9.1% 7.0% 4.9% 6.0% 7.4% 6.7% 6.4% HIUK London (0.8%) (1.8%) 5.3% 11.8% 11.2% 6.9% 11.5% 1.2% 9.6% 5.4% 6.4% ASIA PACIFIC IC O&L Comparable 2004 vs 2003 (3.0%) 1.8% 4.1% 58.6% 48.7% 13.7% 18.2% 0.4% 38.1% 8.7% 10.2% IC O&L Comparable 2004 vs 2002 3.3% (1.5%) 0.1% 0.6% (0.4%) (9.3%) (4.8%) 0.2% (2.9%) (1.4%) (1.9%)

slide-52
SLIDE 52

System Size – Total at 30 June 2004

4.1 System Size - Total

Owned & Leased Managed Franchised Total Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms InterContinental 9 4,067 16 5,375 19 5,315 44 14,757 Crowne Plaza 6 2,284 19 6,649 86 23,256 111 32,189 Holiday Inn 8 2,577 57 18,146 1,036 191,101 1,101 211,824 Express

  • 3

440 1,348 108,894 1,351 109,334 Staybridge 4 492 36 4,443 36 3,915 76 8,850 Candlewood

  • 76

9,189 36 3,711 112 12,900 Other (0) 5 1,087 5 1,087 Total Americas 27 9,420 212 45,329 2,561 336,192 2,800 390,941 InterContinental 13 4,771 42 13,308 9 2,925 64 21,004 Crowne Plaza 15 3,879 20 5,218 29 6,681 64 15,778 Holiday Inn 89 15,877 31 5,821 218 33,429 338 55,127 Express 10 1,320 8 874 126 12,763 144 14,957 Staybridge

  • Other

(0) (0) (0) (0) 1 222 1 222 Total EMEA 127 25,847 101 25,221 383 56,020 611 107,088 InterContinental 2 729 17 6,090 7 2,317 26 9,136 Crowne Plaza 3 698 25 8,840 6 1,831 34 11,369 Holiday Inn 7 1,579 48 13,749 25 4,241 80 19,569 Express

  • 1

95 1 137 2 232 Staybridge

  • Other
  • 4

572 4 572 Total Asia Pacific 12 3,006 95 29,346 39 8,526 146 40,878 InterContinental 24 9,567 75 24,773 35 10,557 134 44,897 Crowne Plaza 24 6,861 64 20,707 121 31,768 209 59,336 Holiday Inn 104 20,033 136 37,716 1,279 228,771 1,519 286,520 Express 10 1,320 12 1,409 1,475 121,794 1,497 124,523 Staybridge 4 492 36 4,443 36 3,915 76 8,850 Candlewood

  • 76

9,189 36 3,711 112 12,900 Other (0) 9 1,659 1 222 10 1,881 Total System 166 38,273 408 99,896 2,983 400,738 3,557 538,907

slide-53
SLIDE 53

System Size – Change to 30 June 2004 (from 31 December 2003)

4.2 System Size - Change

Owned & Leased Managed Franchised Total Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms InterContinental (1) (354) (1) (136)

  • 173

(2) (317) Crowne Plaza

  • (4)

(3) (919) 8 1,877 5 954 Holiday Inn

  • (88)

(8) (1,378)

  • (99)

(8) (1,565) Express

  • (1)

(217) 31 2,755 30 2,538 Staybridge

  • (4)

4 432 1 201 5 629 Candlewood

  • (30)

3 361 3 331 Other (0) (1) (134) (1) (134) Total Americas (1) (450) (10) (2,382) 43 5,268 32 2,436 InterContinental

  • (8)

(1) (364) 2 534 1 162 Crowne Plaza (1) (303) 1 119 2 273 2 89 Holiday Inn (2) 95 (2) (266) 2 301 (2) 130 Express 2 325 2 249 8 1,113 12 1,687 Staybridge

  • Other

(1) (580) (0) (0) (1) (208) (2) (788) Total EMEA (2) (471) (262) 13 2,013 11 1,280 InterContinental

  • 6
  • 6

Crowne Plaza

  • (1)

(300) 1 111 (189) Holiday Inn (1) (72)

  • 128

1 130 186 Express

  • Staybridge
  • Other

(1) (193) (4) (734) (1) (203) (6) (1,130) Total Asia Pacific (2) (265) (5) (900) 1 38 (6) (1,127) InterContinental (1) (362) (2) (494) 2 707 (1) (149) Crowne Plaza (1) (307) (3) (1,100) 11 2,261 7 854 Holiday Inn (3) (65) (10) (1,516) 3 332 (10) (1,249) Express 2 325 1 32 39 3,868 42 4,225 Staybridge

  • (4)

4 432 1 201 5 629 Candlewood

  • (30)

3 361 3 331 Other (2) (773) (5) (868) (2) (411) (9) (2,052) Total System (5) (1,186) (15) (3,544) 57 7,319 37 2,589

slide-54
SLIDE 54

Pipeline – Total at 30 June 2004

5.1 Pipeline - Total

Owned & Leased Managed Franchised Total Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms InterContinental 2 842 3 1,444

  • 5

2,286 Crowne Plaza

  • 1

250 17 4,162 18 4,412 Holiday Inn

  • 1

120 90 11,548 91 11,668 Express

  • 1

252 263 21,744 264 21,996 Staybridge

  • 4

584 46 4,602 50 5,186 Candlewood

  • 29

2,489 29 2,489 Indigo

  • 1

141

  • 1

141 Total Americas 2 842 11 2,791 445 44,545 458 48,178 InterContinental

  • 12

3,627

  • 12

3,627 Crowne Plaza

  • 2

648 4 922 6 1,570 Holiday Inn

  • 9

2,413 15 2,507 24 4,920 Express 1 250 8 964 30 3,180 39 4,394 Staybridge

  • Total EMEA

1 250 31 7,652 49 6,609 81 14,511 InterContinental

  • 4

1,395

  • 4

1,395 Crowne Plaza

  • 12

3,665

  • 12

3,665 Holiday Inn

  • 18

4,732

  • 18

4,732 Express

  • 3

843

  • 3

843 Staybridge

  • Total Asia Pacific
  • 37

10,635

  • 37

10,635 InterContinental 2 842 19 6,466

  • 21

7,308 Crowne Plaza

  • 15

4,563 21 5,084 36 9,647 Holiday Inn

  • 28

7,265 105 14,055 133 21,320 Express 1 250 12 2,059 293 24,924 306 27,233 Staybridge

  • 4

584 46 4,602 50 5,186 Candlewood

  • 29

2,489 29 2,489 Indigo

  • 1

141

  • 1

141 Total System 3 1,092 79 21,078 494 51,154 576 73,324

slide-55
SLIDE 55

Pipeline – Change to 30 June 2004 (from 31 December 2003)

5.2 Pipeline - Change

Owned & Leased Managed Franchised Total Hotels Rooms Hotels Rooms Hotels Rooms Hotels Rooms InterContinental

  • (1)

(112)

  • (1)

(112) Crowne Plaza

  • 5

1,463 5 1,463 Holiday Inn (1) (143) (1) (780) 10 368 8 (555) Express

  • 20

1,740 20 1,740 Staybridge (1) (131) (3) (337) 8 806 4 338 Candlewood

  • 2

163 2 163 Indigo

  • 1

141

  • 1

141 Total Americas (2) (274) (4) (1,088) 45 4,540 39 3,178 InterContinental

  • (1)

(291) (1) (104) (2) (395) Crowne Plaza

  • (1)

(200)

  • 105

(1) (95) Holiday Inn

  • (6)

(2,104) (2) (408) (8) (2,512) Express (2) (324)

  • 44

(2) (327) (4) (607) Total EMEA (2) (324) (8) (2,551) (5) (734) (15) (3,609) InterContinental

  • 1

305

  • 1

305 Crowne Plaza

  • 5

1,525 (1) (132) 4 1,393 Holiday Inn

  • 1

115 (1) (127) (12) Express

  • 3

843

  • 3

843 Total Asia Pacific

  • 10

2,788 (2) (259) 8 2,529 InterContinental

  • (1)

(98) (1) (104) (2) (202) Crowne Plaza

  • 4

1,325 4 1,436 8 2,761 Holiday Inn (1) (143) (6) (2,769) 7 (167) (3,079) Express (2) (324) 3 887 18 1,413 19 1,976 Staybridge (1) (131) (3) (337) 8 806 4 338 Candlewood

  • 2

163 2 163 Indigo

  • 1

141

  • 1

141 Total Pipeline (4) (598) (2) (851) 38 3,547 32 2,098