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Obtain a copy of the annual report for Intercontinental Hotel Group PLC for the year ended 31 December 2011 - Coursework Example

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Obtain a copy of the annual report for Intercontinental Hotel Group PLC for the year ended 31 December 2011

Financial performance and position of the Group “The big picture is 9 hotel brands, over 153 million guests annually, more than 672,000 rooms in over 4,500 hotels in nearly 100 countries and territories around the world” (IHG website, 2012), The nine renowned brands being Intercontinental Hotels & Resorts, Crowne Plaza Hotels & Resorts, Hotel Indigo, Holiday Inn Hotels & Resorts, Holiday Inn Express, Staybridge Suites, Candlewood Suites, EVEN Hotels, Hualuxe Hotels and Resorts. Performance of the Brands The performance of all the brands during 2011 compared to the previous year has improved (Exhibit – I). Total gross revenue has increased by 8% to 20.2 bn in 2011 compared to $18.7 bn in 2010 for the group as a whole. Exhibit - I $ in bn. However, the performance in terms of cost and profitability in respect of the brands could not be worked for comparison due to inadequacy of details furnished in this respect. Performance can be analyzed with reference to classification of the business into Franchised, Managed and Owned & Leased. 12 months ended 31 December in $m 2011 2010 % Change Revenue Franchised 502 465 8.0 Managed 124 119 4.2 Owned and leased 204 223 (8.5) Total 830 807 2.9 Operating profit before exceptional items Franchised 431 392 9.9 Managed 52 21 147.6 Owned and leased 17 13 30.8 500 4 26 17.4 Regional overheads (49) (57) 14.0 Total Operating Profit 451 369 22.2 It could be observed that operating profits vary considerably due to incidence of expenses and overheads at varying levels. For example, in franchised revenue is up by 8% and operating profit is up by 9.9%, where as in managed hotels it is 4.2% and 147.6% and owned & leased hotels (-) 8.5% and 30% respectively . Key Performance Indicators The key performance indicators measure the group’s progress in the business. The KPIs over the past three years and their growth have been good. Year 2009 2010 2011 Net Rooms Supply 632325 0647161 658348 Gross Revenue ($ bn) 16.8 18.7 20.2 CSR (Green engage hotels) 911 1122 1722 2011 2010 Earnings per share (EPS) 1.30 0.98 Revenue per available room: Revenue per available room is up by 6.2%. (Annual Report, p. 2) The Group’s reportable segments segmental information The reportable segments in the business have been classified based on the geographical locations of the hotels. There are five segments viz. Americas, Europe, AMEA (Asia Middle East and Africa) and Greater China and the central segment. Operating profit has increased in all the geographical segments. Since the central segment carries the burden of general support services provided by it to all the segments, the figures are not comparable. RevPAR growth in the Americas at 7.5% and Europe at 4.7% respectively has contributed significantly for the overall performance of the business. It is important to note that gross revenue includes revenue related to Franchised, Managed and Owned & Leased. 2011 2010 % Change % Change in revenue Operating Profit Americas 451 369 2.2 2.9 Europe 104 78 33.3 2.4 AMEA 84 82 2.4 1.4 Greater China 67 54 24.1 15.2 Central (147) (139) (5.8) 7.7 Operating Profit Before Exceptional Items 559 444 25.9 8.6 It could be observed that as in the case of franchised, managed and owned and leased classification of the business, % change in operating profit is inconsistent with the % change in revenue due to incidence of expenses and overheads in different reportable segments at varying levels. Impact of exceptional items on profitability The operating profit ...Show more

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Intercontinental Hotels Group plc Review of the Annual report for the year ended 31 December 2011 The Annual Report of the Intercontinental Hotel Group for the year ended 31 December 2011 has been analysed to ascertain the financial performance and position of the company…
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Obtain a copy of the annual report for Intercontinental Hotel Group PLC for the year ended 31 December 2011 essay example
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