Holiday Inn 2003 Annual Report Download - page 8

12 months to
31 Dec 31 Dec
2003 2002 Change
EMEA RESULTS £m £m %
Tu r n ov er :
Owned and leased 746 739 1
Managed 38 37 3
Franchised 23 24 -4
807 800 1
Operating profit before exceptional items:
Owned and leased 77 115 -33
Managed 19 21 -10
Franchised 18 14 29
114 150 -24
Regional overheads (22) (30) -27
Total £m 92 120 -23
Dollar equivalent $m 149 180 -17
FIGURE 3
Hotels Rooms
EMEA SYSTEM SIZE Change over Change over
AT 31 DECEMBER 2003 2003 over 2002 2003 over 2002
Analysed by brand:
InterContinental 63 -6 20,842 -82
Crowne Plaza 62 515,689 1,306
Holiday Inn 340 654,997 1,190
Holiday Inn Express 132 21 13,270 2,546
Other brands 3-1 1,010 -80
Total 600 25 105,808 4,880
Analysed by ownership type:
Owned and leased 129 –26,318 148
Managed 101 225,483 1,707
Franchised 370 23 54,007 3,025
Total 600 25 105,808 4,880
Analysed by geography:
United Kingdom 204 12 29,053 1,276
Rest of Europe 280 18 48,795 3,852
Middle East and Africa 116 -5 27,960 -248
Total 600 25 105,808 4,880
to that experienced in the Americas, with trading depressed by
the threat and then outbreak of the war in Iraq. In the second
half of the year, the UK market showed signs of recovery,
although the picture was less clear in Europe, with both the
German and French markets experiencing mixed trading
conditions.
The Holiday Inn UK estate recorded five consecutive months
of RevPAR growth to finish the year up 2.3%. The UK regions,
with their domestic focus, recovered earlier than London and
recorded seven consecutive months of growth. In London,
December 2003 trading was particularly strong with the
majority of the owned estate recording double digit RevPAR
growth to end the month up 12.3%.
Across EMEA the InterContinental estate finished the year
with an overall RevPAR decline of 5.7%. While the owned
InterContinental estate finished down 8.0% due to its exposure
to the main European gateways, the managed Middle East
estate traded more positively with the comparable Middle East
estate recording RevPAR growth of 2.7%.
Crowne Plaza finished the 12 months with RevPAR growth of
3.3% due to growth in the managed and franchised estates
of 11.1% and 3.2% respectively. This performance was helped
by the Middle East estate which finished the 12 months ended
31 December 2003 up 29.5%.
Franchise turnover fell due to a fall in RevPAR and exchange
rate movements, offset by growth in system size. Franchise
profits grew primarily due to savings in franchise overhead
realised as part of the reorganisation review.
EMEA pro forma operating profit before exceptional items
totalled £92m for the 12 months ended 31 December 2003.
The conversion of revenue to operating profit was depressed
by the owned and leased estate, where the combined effects
of pre-opening costs, hotels opening towards the end of the
period, and increased depreciation charges associated with
prior year refurbishment, all negatively impacted costs.
Regional overheads fell £8m to £22m for the 12 months
ended 31 December 2003 (£30m for the 12 months ended
31 December 2002) as a result of the reorganisation initiatives.
During the year the InterContinental Le Grand Paris reopened
after a full refurbishment to widespread acclaim, firmly
positioning the property at the top of the Paris market. The
Holiday Inn Paris Disney opened giving representation at one
of Europe’s leading family leisure destinations and the Crowne
Plaza Brussels Airport opened at the end of the year, giving
the brand another defining asset at a major European airport.
OPERATING AND FINANCIAL REVIEW
6InterContinental Hotels Group 2003