Intercontinental Hotels Group H1 Earnings Call Highlights

Intercontinental Hotels Group H1 Earnings Call Highlights

Strong first-half financial performance: Global RevPAR rose 4.1%, fee revenue increased 7%, operating profit grew 10%, and adjusted EPS climbed 13% to 274.7 cents. IHG raised its interim dividend 10% and expects to return more than $1.2 billion to shareholders in 2026. Americas led hotel demand growth: Americas RevPAR increased 4.8%, while EMEAA and Greater China grew 3% and 3.1%, respectively. Group travel was the strongest global demand segment, with revenue up 6%. Development activity reached record levels: IHG opened 197 hotels and signed 352 more in the first half, producing 5% net system growth. Its pipeline of 2,400 hotels represents potential future room growth of 33%, supported by continued momentum in markets including the U.S., China, India and Saudi Arabia.

Intercontinental Hotels Group NYSE: IHG reported higher revenue, operating profit and earnings per share for the first half of 2026, supported by global hotel demand, margin expansion and record development activity. Chief Executive Officer Elie Maalouf said the company delivered “strong financial performance” during the period, with global revenue per available room, or RevPAR, rising 4.1%, net system growth reaching 5%, fee revenue increasing 7% and reportable-segment operating profit growing 10%. Adjusted earnings per share rose 13% to 274.7 cents, aided by profit growth, margin gains and share repurchases. IHG also declared an interim dividend of 64.5 cents per share, up 10% from a year earlier.

Financial results and capital returns Chief Financial Officer Michael Glover said reportable-segment revenue rose 7% to $1.26 billion and EBIT increased 10% to $655 million. Fee business revenue increased 7% to $971 million, while fee business operating profit grew 8% to $640 million. Fee margin expanded 120 basis points to 65.9%, which Glover said was in line with IHG’s medium- to long-term objective of annual average margin expansion of 100 to 150 basis points. Fee margins improved across each geographic region: Americas fee margin rose 150 basis points to 84.2%, with operating profit up 7% to $442 million. EMEAA fee margin increased 400 basis points to 69.8%, supporting 10% profit growth to $141 million. Greater China fee margin expanded 460 basis points to 62.5%, with operating profit increasing 25% to $55 million. Adjusted free cash flow was $360 million, up $58 million from the first half of 2025. The company said trailing 12-month cash conversion remained above 100%. IHG’s $950 million share repurchase program was 42% complete at the half-year balance sheet date. The company had repurchased another 2.7 million shares, reducing its share count by 1.8%. Including ordinary dividends of about $285 million, IHG expects to return more than $1.2 billion to shareholders in 2026. Glover said the company narrowed its full-year adjusted interest-cost guidance to $230 million to $240 million. It maintained its outlook for fee business overhead growth of 1% to 3% for the full year, despite a 4% increase in the first half due partly to the timing of front-loaded costs.

RevPAR growth led by the Americas Global RevPAR growth of 4.1% reflected a one-percentage-point increase in occupancy and a 2.5% rise in average daily rate. Second-quarter global RevPAR grew 3.5%, and all three operating regions posted positive growth for both the quarter and first half. Americas RevPAR increased 4.8% during the half, accelerating from 3.6% in the first quarter to 5.4% in the second quarter. Glover said the Worl...