Holiday Inn 2015 Annual Report Download - page 10

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Our Winning Model remains at the heart of
our success and it continues to help deliver
high-quality growth. We made significant
progress against each element of the model
in 2015, particularly in terms of building and
strengthening our portfolio of preferred
brands, enhancing our leading loyalty
programme, and ensuring that the way
we manage our channels is as effective
as possible.
Financial and operational highlights
We continued to drive strong momentum in
the year. We delivered double-digit underlying
profit growth, opened more hotels into the
System than we have since 2009, signed more
hotels than we have since 2008, and closed
the year with more than 5,000 open hotels
in our System – a significant milestone for
the business. Our focus on driving growth
in priority markets where we see the greatest
opportunity has paid off, with 87 per cent
of our open rooms and approximately 90 per
cent of our pipeline rooms in these markets.
This will continue to be a key part of our
strategy in the coming years.
2015 also marked the successful completion
of our major asset-disposal programme,
with the sale of InterContinental Hong Kong,
over which IHG retained a 37-year
management contract with three 10-year
extension rights. It was fitting that this iconic
building should be the last major owned asset
in our portfolio. Our asset-light approach is
highly cash-generative and delivers a high
return on capital employed. It also means
that we benefit from the reduced volatility
of fee-based income streams so we can focus
on growing our fee revenues and fee margins
with limited requirements for our capital.
We continued to make excellent progress
delivering against our technology strategy,
building on our strong track record of
innovation and leadership in this space.
This includes successfully driving digital
revenue growth. In 2015, we leveraged
our highly rated mobile app, with over
40 per cent of digital visits on mobile, and
we recorded annual mobile revenue of more
than $1 billion, up from less than $50 million
in 2010. This is a remarkable achievement.
One of our key highlights
of the year was welcoming
Kimpton Hotels &
Restaurants into the
IHG family and seeing
the business enjoy the
best year in its history.”
Richard Solomons
Chief Executive Officer
Strengthening our brand portfolio
We strengthened our portfolio of preferred
brands during the year, and focused on
innovating and evolving our brand offer.
We opened the first three HUALUXE Hotels
and Resorts in Greater China, and a flagship
property for EVEN Hotels in New York, with
a further six hotels for the EVEN brand
signed into the pipeline.
A key highlight of the year was welcoming
Kimpton Hotels & Restaurants into the IHG
family. Boutique is the industry’s fastest-
growing segment and, with Kimpton and
Hotel Indigo, we are uniquely positioned to
benefit from this increase in demand. 2015
was Kimpton’s best ever year in terms of
openings and signings and, in January 2016,
we were delighted to announce the brand’s
first signing outside of The Americas,
in Amsterdam, the Netherlands.
This year will see us celebrating the 70th
anniversary of InterContinental Hotels
& Resorts, the largest luxury hotel brand
in the world. Holiday Inn Express, which is
part of the Holiday Inn brand family, the
world’s largest hotel brand, will also be
celebrating its 25th birthday in 2016.
Building loyalty and meaningful membership
Building loyalty and lifetime relationships
with our guests is an important part of our
business and a key growth driver for us. We
know that guests are looking for a rewarding
relationship built on trust, and respond best
to efforts that are focused on building
genuine brand loyalty over a sustained period
of time. We are constantly looking at ways
in which we can enhance our ability to deliver
a personalised experience for members,
before, during and after their stay. Our insight
shows us that frequent travellers want to
be given an extra level of reward in return
for their continued loyalty, too. As a result,
we introduced a new top-tier membership
level, Spire Elite, and restructured IHG
Rewards Club so that it is easier for our loyal
members to reach gold and platinum status.
We drove strong momentum in 2015 and delivered
excellent financial and operational performance.
Our focus on driving growth in markets where we
see the greatest opportunity has paid off, and will
continue to be a key part of our strategy in the
coming years.
8IHG Annual Report and Form 20-F 2015