InterContinental Hotels Group (IHG) H1 2026 (Q&A) earnings summary

Executive summary

• EBIT and operating profit from reportable segments rose 10% year-over-year to $665m, with adjusted EPS up 13% to 274.7¢, supported by share buybacks and record development activity, including 8% organic growth in openings and signings.

• Global RevPAR increased 4.1% year-over-year, with all regions and brands contributing positively; Americas up 4.8%, EMEAA up 3.0%, Greater China up 3.1%.

• Net system size grew 5% year-over-year to 1,049k rooms, with a global pipeline of 348k rooms, representing 33% of current system size.

• On track to return over $1.2bn to shareholders in 2026, including a $950m share buyback (42% completed by June) and a 10% increase in interim dividend.

• Strategic focus on broadening brand reach, geographic expansion, and leveraging technology, including AI, to enhance guest experience and owner economics.

Financial highlights

• Revenue from reportable segments grew 7% year-over-year to $1,255m; fee business revenue up 7% to $971m.

• Fee margin expanded by 1.2 percentage points to 65.9%, with Americas at 84.2%, EMEAA at 69.8%, and Greater China at 62.5%.

• Adjusted free cash flow reached $360m, up from $302m in H1 2025; cash conversion exceeded 100% on a trailing 12-month basis.

• Interim dividend increased 10% to 64.5¢ per share; total dividends for 2026 expected to be $285m.

• Net debt to adjusted EBITDA ratio at 2.63x, within the 2.5–3.0x target range.

Outlook and guidance

• Confident in long-term growth outlook, with continued opportunity to exceed consensus NUG of 4.7% and meet full-year profit and earnings expectations.

• Medium- to long-term guidance targets 12–15% CAGR in adjusted EPS, high single-digit fee revenue growth, and 100–150bps annual fee margin expansion.

• Expect gradual recovery in Middle East occupancy if current conditions persist.

• Residences business projected to become a material fee contributor by 2027 and beyond.

• FY26 adjusted interest expense expected to rise to $230m–$240m, with adjusted tax rate at 26–27%.