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Below is an ongoing record highlighting notes from select IHG investor presentations and earnings calls (newest content shown first).

First Half 2018 Interim Results, 8/7/2018


  • 1% net rooms growth for 1H2018 and 3.7% global RevPAR growth for 1H
  • +8% EBIT growth and +25% underlying EPS growth for 1H
  • $125mm efficiency program well underway
  • New brands added – Avid (mid-scale), Voco (upscale), Regent (luxury)
  • Raised interim dividend by 10%
  • Added 22k rooms to the system in 1H and removed 10k rooms from system. FY 2018 removals expected to be at higher end of 2-3% range
  • Total underlying fee revenue of $699mm up 5.3%
  • Q&A with Sell-side Analysts
  • 2019 RevPAR expectations and segment trends?
    • Macro data such as non-residential fixed investment, which has been strong this year and forecasted to be strong next year, correlates well with hotel room demand
    • Early expectation is for 3% RevPAR growth at the midpoint for 2019
    • Seeing very healthy growth in all major segments. Business transient picked up from 0-1% to 2-3%.  Leisure transient still strong in 3% range and group business ticking up into the 3-4% range
    • Conversations with big corporate customers for 2019 around both volume and rate have been positive
  • Economic slowdown?
    • Haven’t seen much of a change. There were typhoons in Asia and China slowing a bitoffset by better growth in the US
    • We have not seen signs of global slowdown
  • Meeting planner feedback for 2019?
    • Conversations are more positive now than they were a year ago
    • Special corporate (10% of business) indicate companies willing to travel more and spend more
  • Worries about development pipeline?
    • HLT is 11% of the US market but we are getting 25% of the construction pipeline so we are getting our fair share, but deals are getting harder to get done due to cost increases
    • 2018 will be up 10% in terms of cost to build
    • Credit is incrementally tighter and interest rates incrementally higher
    • US supply growth is supplying but international markets such as Asia are picking up
  • M&A
    • Has not made sense historically vs. what HLT can do organically to build new brands
  • Deal terms being offered?
    • In the US where deals are getting tighter, deal terms (with franchisees) are getting incrementally tougher but not in a material way
  • Capital allocation
    • Leverage target is still 3-3.5x
  • Conversion activity
    • Have seen a minor acceleration in conversion activity and expect 20% of unit growth to be conversions for 2018. This is consistent with historic levels of 19-25%.  Conversions peaked in the high 30s following the financial crisis
    • We used to have only one conversion brand – DoubleTree, but now have Tapestry, Curio, and soon some soft luxury brands
  • Group business
    • Looking to be up 8-9% for 2019, but normalizing for change in commission structure, group growth would more likely have been in the 5-6% range
  • Luxury brands
    • Luxury has a halo effect for the family of brands so spend a disproportionate amount of time on it
    • Waldorf – 64 open and 38 in the pipeline