Holiday Inn 2012 Annual Report Download - page 81

OVERVIEW BUSINESS REVIEW GOVERNANCE
GROUP FINANCIAL
STATEMENTS
PARENT COMPANY FINANCIAL STATEMENTS OTHER INFORMATION
Governance
Other statutory information
Directors’ Remuneration Report and Other statutory information 79
Pages 1 to 80 (together with the sections of the Annual Report incorporated by
reference) constitute the Directors’ Report. The Directors present their report for the
financial year ended 31 December 2012.
Principal activities
InterContinental Hotels Group PLC (the Company), registered and
domiciled in England and Wales, with registered number 5134420,
is the holding company of the InterContinental Hotels Group (the
Group). The Group franchises, manages, owns and leases over
4,600 hotels with nearly 676,000 guest rooms in nearly 100 countries
and territories around the world.
General
Articles of Association (Articles)
The Company’s Articles may only be amended by special resolution.
Subject to the Articles and any relevant legislation, all Director
appointments must be ratified by the shareholders. The Articles
are available on the Company’s website www.ihgplc.com/investors
under corporate governance.
Annual General Meeting (AGM)
The Notice convening the AGM to be held at 11.00am on Friday,
24 May 2013 is contained in a circular sent to shareholders at the
same time as this Annual Report.
Board of Directors
Biographical details of Directors who served on the Board as at
18 February 2013 are shown on pages 46 and 47. The following were
Directors during 2012 and held office throughout the year, unless
otherwise indicated:
Executive Directors Non-Executive Directors
Kirk Kinsell Graham Allan1
Tracy Robbins Patrick Cescau2
Tom Singer David Kappler
Richard Solomons Jennifer Laing
Jonathan Linen
Luke Mayhew
Dale Morrison
David Webster2
Ying Yeh
1 Graham Allan resigned as a Non-Executive Director on 15 June 2012.
2 Patrick Cescau was appointed on 1 January 2013 following the retirement of
David Webster on 31 December 2012.
Employees
IHG directly employed an average of 7,981 people worldwide during
2012, whose costs are borne by the Group. When the whole IHG
estate is taken into account (including staff working in the franchised
and managed hotels) more than 350,000 people worked globally
across all IHG’s brands at 31 December 2012.
Group Code of Ethics and Business Conduct (Group Code of Conduct)
As part of our commitment to being a Responsible Business, the
Board has a Group Code of Conduct relating to the lawful and ethical
conduct of business by its employees. All Directors and employees
are expected to observe the high standards set out in the Group Code
of Conduct and adhere to the Company values.
Further information regarding the Group’s employment policies,
including its obligations under equal opportunities legislation, its
commitment to employee communications and its approach towards
employee development, can be found on pages 30 to 33.
Subsidiaries, joint ventures and associated undertakings
The Group has over 290 subsidiary, joint venture and associated
undertakings.
Shares
Results and dividends
The operating profit before exceptional items was $614m: the Group’s
income statement is set out on page 84. An interim dividend of
13.5 pence per share (21.0 cents per ADR) was paid on 28 September
2012. A special dividend of 108.4 pence per share ($1.72 per ADR)
was paid on 22 October 2012. The Directors are recommending
a final dividend of 27.7 pence per share (43.0 cents per ADR) to be
paid on 31 May 2013 to shareholders on the Register of Members
at the close of business on 22 March 2013. Therefore, excluding the
special dividend, the full-year dividend will be 41.2 pence per share
(64.0 cents per ADR) (2011 34.5 pence per share (55.0 cents per
ADR)). Total dividends relating to the year, excluding the special
dividend, are expected to amount to $176m.
Share capital
The Company’s issued share capital at 31 December 2012 consisted
of 268,325,071 ordinary shares of 14194 /329 pence each. There are no
special control rights or restrictions on share transfers or limitations
on the holding of any class of shares. During the year, 1,365,258 new
shares were issued under employee share plans and the Company
completed a share consolidation and commenced a share buyback
(see below).
Employee share ownership trust
IHG operates an Employee Share Ownership Trust (ESOT) for the
benefit of employees and former employees. The ESOT purchases
shares in the market and releases them to current and former
employees in satisfaction of share awards. During the year, the ESOT
released 3,219,427 shares and at 31 December 2012 it held 1,814,507
shares in the Company. The ESOT adopts a prudent approach to
purchasing shares, using funds provided by the Group, based on
expectations of future requirements.
2012 share awards and grants
No awards or grants over shares were made during 2012 that would
be dilutive of the Company’s ordinary share capital. Current policy is
to settle the majority of awards or grants under the Company’s share
plans with shares purchased in the market. A number of options
granted up to 2005 are yet to be exercised and will be settled with the
issue of new shares.
The Company has not utilised the authority given by shareholders at
any of its AGMs to allot shares for cash without first offering such
shares to existing shareholders.
Share issues and buybacks
On 7 August 2012, the Company announced a $1bn return of funds to
shareholders via a special dividend of $0.5bn and share consolidation
on a 14 for 15 basis and a share buyback programme of $0.5bn. The
share buyback authority remains in force until the AGM in 2013, and
a resolution to renew the authority will be put to shareholders at
that AGM.
During the year the following transactions took place which affected
the Company’s issued share capital:
Period Event Ordinary shares
1 Jan to 31 Dec 2012 Share plan exercises 1,365,258
9 Oct 2012 14 for 15 share consolidation n/a
12 Nov to 20 Dec 2012 Share buyback 4,143,960