Holiday Inn 2008 Annual Report Download - page 94

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92 IHG Annual Report and Financial Statements 2008
28 IHG shareholders’ equity
Shares Unrealised
Equity Capital held by gains and Currency IHG
share redemption employee Other losses translation Retained shareholders’
capital reserve share trusts reserves reserve reserve earnings equity
$m $m $m $m $m $m $m $m
At 1 January 2007 129 8 (33) (2,914) 53 209 3,878 1,330
Total recognised income and expense
for the year ––––(16) 24 477 485
Issue of ordinary shares 32––––––32
Repurchase of shares (2)–––––(160) (162)
Transfer to capital redemption reserve –2––––(2)–
Purchase of own shares by employee
share trusts – – (138) ––––(138)
Release of own shares by employee
share trusts ––89–––(80) 9
Equity-settled share-based cost ––––––6060
Equity dividends paid ––––––(1,524) (1,524)
Exchange adjustments 4–(1)(4)1–––
At 31 December 2007 163 10 (83) (2,918) 38 233 2,649 92
Total recognised income and expense
for the year ––––(29) (61) 236 146
Issue of ordinary shares 2––––––2
Repurchase of shares (3)–––––(136) (139)
Transfer to capital redemption reserve –3––––(3)–
Purchase of own shares by employee
share trusts – – (24) ––––(24)
Release of own shares by employee
share trusts ––39–––(53) (14)
Equity-settled share-based cost ––––––4949
Equity dividends paid ––––––(118) (118)
Exchange adjustments (44) (3) 19 28––––
At 31 December 2008 118 10 (49) (2,890) 9 172 2,624 (6)
Equity share capital
The balance classified as share capital includes the total net proceeds (both nominal value and share premium) on issue of the Company’s
equity share capital, comprising 13 29⁄47p shares. The share premium reserve has a balance of $61m (2007 $82m) representing the amount
of proceeds received for shares in excess of their nominal value.
Capital redemption reserve
This reserve records the nominal value of equity share capital repurchased and cancelled.
Shares held by employee share trusts
Comprises $49.2m (2007 $82.6m) in respect of 3.0m (2007 3.4m) InterContinental Hotels Group PLC ordinary shares held by employee
share trusts, with a market value at 31 December 2008 of $25m (2007 $60m).
Other reserves
Comprises the merger and revaluation reserves previously recognised under UK GAAP, together with the reserve arising as a consequence
of the Group’s capital reorganisation in June 2005. Following the change in presentational currency to the US dollar (see page 56), this
reserve also includes exchange differences arising on the retranslation to period-end exchange rates of equity share capital, the capital
redemption reserve and shares held by employee share trusts.
Unrealised gains and losses reserve
This reserve records movements to fair value of available-for-sale financial assets and the effective portion of the cumulative net change
in the fair value of the cash flow hedging instruments related to hedged transactions that have not yet occurred.
The fair value of cash flow hedging instruments outstanding at 31 December 2008 was a $10m liability (2007 $3m liability).
Currency translation reserve
This reserve records the movement in exchange differences arising from the translation of the financial statements of foreign operations
and exchange differences on foreign currency borrowings and derivative instruments that provide a hedge against net investments
in foreign operations. On adoption of IFRS, cumulative exchange differences were deemed to be $nil as permitted by IFRS 1.
During the year ended 31 December 2008, the impact of hedging net investments in foreign operations was to reduce the amount
recorded in the currency translation reserve by $96m (2007 $14m). The fair value of derivative instruments designated as hedges
of net investments in foreign operations outstanding at 31 December 2008 was $nil (2007 $nil).
Notes to the Group financial statements continued