Holiday Inn 2015 Annual Report Download - page 156

Directors’ Report continued
Significant agreements and change of control provisions
The Group is a party to the following arrangements which could
be terminated upon a change of control of the Company and which
are considered significant in terms of their potential impact on the
business of the Group as a whole:
• the seven-year £250m bond issued by the Company on 9 December
2009, under which, if the bond’s credit rating was downgraded in
connection with a change of control, the bond holders would have
the option to require the Company to redeem or, at the Company’s
option, repurchase the outstanding notes together with interest
accrued;
• the 10-year £400m bond issued by the Company on 26 November
2012, under which, if the bond’s credit rating was downgraded in
connection with a change of control, the bond holders would have
the option to require the Company to redeem or, at the Company’s
option, repurchase the outstanding notes together with interest
accrued;
• the five-year $1.275bn syndicated loan facility agreement dated
30 March 2015, under which a change of control of the Company
would entitle each lender to cancel its commitment and declare
all amounts due to it payable; and
• the 10-year £300m bond issued by the Company on 14 August 2015,
under which, if the bond’s credit rating was downgraded in connection
with a change of control, the bond holders would have the option
to require the Company to redeem or, at the Company’s option,
repurchase the outstanding notes together with interest accrued.
Further details on these are set out on pages 163 and 164.
Business relationships
During 2012, the Group entered into a five-year technology outsourcing
agreement with International Business Machines Corporation (IBM),
pursuant to which IBM operates and maintains the infrastructure
of the Group’s Guest Reservation System. Otherwise, there are no
specific individual contracts or arrangements considered to be
essential to the business of the Group as a whole.
Disclosure of information to Auditor
For details, see page 80.
Events after the reporting period
In February 2016, the Board proposed a $1.5 billion return of funds
to shareholders via a special dividend with share consolidation.
Listing Rules – compliance with LR 9.8.4C
Section Applicable sub-paragraph within LR 9.8.4C Location
1 Interest capitalised Group Financial
Statements, note 6,
page 108
4 Details of long-term incentive
schemes
Directors’
Remuneration Report,
pages 70 to 74
6 Waiver of future emoluments
by a Director
Directors’
Remuneration Report,
page 77
The above table sets out only those sections of LR 9.8.4C which are
relevant. The remaining sections of LR 9.8.4 are not applicable.
Greenhouse gas (GHG) emissions
By delivering more environmentally sustainable hotels, we can drive
cost efficiencies for owners, as well as meet the expectations of all our
stakeholders. We recognise the importance of reducing our global GHG
emissions for corporate offices and hotels – our target is to reduce our
carbon footprint per occupied room by 12 per cent across our entire
estate by 2017 (against a 2012 baseline). See page 31 for progress.
Reporting
boundary Measure 2015a2014a
Global –
corporate offices
and franchised,
managed,
owned and
leased hotelsb
(a KPI and part
of our five-year
targets)
Scope 1 Direct
emissions (tCO2e)
1,548,358.61 1,407,239.59
Scope 2 Indirect
emissions (tCO2e)
3,816,695.68 3,706,153.58
Total GHG
emissions (tCO2e)
5,365,054.29 5,113,393.16
IHG’s chosen intensity
measurement GHG
emissions per occupied
room (kgCO2e per
occupied room)
31.65 32.19
Global –
corporate offices
and managed,
owned and
leased hotelsb
(as required
under the
Companies Act
2006)
Scope 1 Direct
emissions (tCO2e)
534,273.70 491,075.00
Scope 2 Indirect
emissions (tCO2e)
1,816,697.92 1,812,930.96
Total GHG
emissions (tCO2e)
2,350,971.62 2,304,005.96
IHG’s chosen intensity
measurement GHG
emissions per occupied
room (kgCO2e per
occupied room)
52.82 56.26
a Reporting period commencing on 1 October and ending on 30 September – due to the delay
in hotels receiving their energy bills it is not possible to report accurately GHG emissions
from 1 January to 31 December.
b Includes all of our branded hotels but does not include emissions from 82 hotels. We
do not have sufficient data to estimate their emissions and believe them to be immaterial.
Scope
We report Scope 1 and Scope 2 emissions as defined by the GHG
protocol as follows:
• Scope 1 (Direct emissions): combustion of fuel and operation
of facilities; and
• Scope 2 (Indirect emissions): electricity, heat, steam and cooling
purchased for own use.
Methodology
We have worked with external consultants to give us an up-to-date
picture of IHG’s carbon footprint and to assess our performance over
the past few years. The external consultants use a sampling and
extrapolation methodology to estimate our GHG emissions.
For 2015, in line with the methodology set out in the GHG Protocol
Corporate Standard, the sample covered 2,939 (69%) of our 4,848
hotels. As IHG’s System size is continually changing and the number
of hotels reporting data to the IHG Green Engage system increases
annually, we are restating the impacts for all years from the baseline
year (2012) annually to enable comparisons to be made.
Finance
Political donations
The Group made no political donations under the Companies Act
during the year and proposes to maintain this policy.
Financial risk management
The Group’s financial risk management objectives and policies,
including its use of financial instruments, are set out in note 20
to the Group Financial Statements on pages 122 to 125.
154 IHG Annual Report and Form 20-F 2015