Holiday Inn 2008 Annual Report Download - page 21

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Business review 19
BUSINESS REVIEW
Capital structure and liquidity management
Net debt at 31 December 2008 was $1,273m and included
$202m in respect of the finance lease commitment for the
InterContinental Boston.
2008 2007*
Net debt at 31 December $m $m
Borrowings:
Sterling 152 553
US dollar 889 882
Euro 224 243
Other 90 98
Cash (82) (117)
Net debt 1,273 1,659
Average debt levels 1,498 1,075
* Including the impact of currency derivatives.
2008 2007
Facilities at 31 December $m $m
Committed 2,107 2,321
Uncommitted 25 50
Total 2,132 2,371
Interest risk profile of gross debt 2008 2007
for major currencies at 31 December %%
At fixed rates 53 45
At variable rates 47 55
In the second quarter, the Group successfully refinanced $2.1bn of
long-term debt facilities. The new syndicated bank facility consists
of two tranches, a $1.6bn five-year revolving credit facility and a
$0.5bn term loan with a 30-month maturity. Terms are broadly
unchanged from the previous facility.
Treasury policy is to manage financial risks that arise in relation to
underlying business needs. The activities of the treasury function
are carried out in accordance with Board approved policies and are
subject to regular audit. The treasury function does not operate as
a profit centre.
Further information on the Group’s treasury management can be
found in note 21 on pages 79 and 80 in the notes to the Group
Financial Statements 2008.
During the year, IHG returned $139m to shareholders through
share buybacks, taking the total returned since March 2004 to
more than £3.5bn. In November 2008 the remaining £30m of the
fourth share buyback programme was deferred in order to preserve
cash and maintain balance sheet strength. The return of funds
programme is denominated in sterling as all returns were
determined prior to the change to US dollar reporting.
Return of funds programme
Total Returned Still to
Timing return to date be returned
£501m special dividend Paid in December 2004 £501m £501m Nil
First £250m share buyback Completed in 2004 £250m £250m Nil
£996m capital return Paid in July 2005 £996m £996m Nil
Second £250m share buyback Completed in 2006 £250m £250m Nil
£497m special dividend Paid in June 2006 £497m £497m Nil
Third £250m share buyback Completed in 2007 £250m £250m Nil
£709m special dividend Paid in June 2007 £709m £709m Nil
£150m share buyback Under way £150m £120m £30m
Total £3,603m £3,573m £30m