It has already been seven months since my initial coverage of InterContinental Hotels Group PLC ( IHG ). Its value has already risen by 11%, which justifies my buy rating from before. This is also justifiableI have been working in the logistics sector for almost two decades. I have been into stock investing and macroeconomic analysis for almost a decade. Currently, I focus on ASEAN and NYSE/NASDAQ Stocks, particularly in banks, telco, logistics, and hotels. Since 2014, I have been trading on the PH stock ma ...

Company Overview - Aoris Investment Management released its Q4 2025 investor letter, focusing on high-quality, wealth-creating businesses with a target return of 8–12% p.a. over a 5–7-year market cycle [1] - The fund's Class A (Unhedged) returned –0.5% after fees, while Class C (Hedged) gained 0.1%, both underperforming their respective benchmarks [1] InterContinental Hotels Group PLC (IHG) - InterContinental Hotels Group PLC (NYSE:IHG) is a leading global hospitality company, with a market capitalization of $20.1 billion [2] - The stock closed at $134.32 per share on March 11, 2026, with a one-month return of -7.92% and a 52-week gain of 20.59% [2] - IHG operates under various brands, including Holiday Inn and Crowne Plaza, and has been gaining market share from independent hotels due to its reward programs and consistent service [3] - IHG reported strong results for its September quarter, showing growth in current earnings and a robust pipeline of new hotel openings [3] Hedge Fund Interest - IHG is not among the 40 most popular stocks among hedge funds heading into 2026, with 12 hedge fund portfolios holding IHG at the end of Q4, down from 14 in the previous quarter [4] - While IHG is recognized for its investment potential, certain AI stocks are considered to offer greater upside potential and less downside risk [4]

Core Viewpoint - The hotel companies, specifically Marriott, Hilton, and InterContinental, are perceived to be richly valued as of early 2025 [1]. Company Analysis - Marriott (MAR), Hilton (HLT), and InterContinental (IHG) are highlighted as the primary hotel companies under consideration for their valuation [1].

Core Insights - The article discusses the best credit cards for various spending categories, emphasizing the importance of selecting a card that aligns with individual spending habits and financial needs [4][5][79] Rewards Value - The Chase Sapphire Preferred card offers 2X points on travel and 3X points on dining, streaming, and online grocery purchases, with a $95 annual fee [1] - The Wells Fargo Active Cash card provides a straightforward 2% cash back on all purchases with no annual fee, making it ideal for everyday spending [2] - The Citi Strata Elite card features high point multipliers, including 6X for airfare booked through its portal and 3X for dining, with a $595 annual fee [11][13] Costs and Interest - The Wells Fargo Reflect card offers a 21-month 0% interest period for balance transfers and purchases, making it a strong option for managing debt [52] - The American Express Blue Cash Preferred card has a $95 annual fee but offers 6% cash back at U.S. supermarkets on up to $6,000 spent annually, providing significant value for grocery shoppers [29][30] Travel Features and Benefits - The Chase Sapphire Reserve for Business card provides 8X points on purchases made through Chase Travel and offers extensive travel perks, including airport lounge access and a $300 travel credit, with a $795 annual fee [67][71] - The United Explorer card allows cardholders to earn 2 miles per dollar on United flights, with additional benefits like free checked bags and priority boarding [17][18] Insurance and Protection Benefits - The Wells Fargo Reflect card includes cellphone protection against damage or theft, provided the phone bill is paid with the card [54] - The Bank of America Customized Cash Rewards Secured card offers 3% cash back in a chosen category and includes benefits typically found in rewards cards, such as cellphone protection [57][58] Other Benefits - The American Express Blue Cash Everyday card provides 3% cash back on gas and U.S. supermarkets with no annual fee, making it a practical choice for everyday expenses [33][36] - The Prime Visa card by Chase offers 5% cash back on Amazon purchases for Prime members, along with 2% on gas, dining, and transit, making it versatile for frequent Amazon shoppers [45][46]

Core Insights - The InterContinental Hotels Group reported a revenue of $2.468 billion for the fiscal year 2025, representing a year-on-year growth of 7% [1] - The operating profit for the same period was $1.265 billion, showing a 13% increase compared to the previous year [1] Financial Performance - The global Revenue per Available Room (RevPAR) increased by 1.5% in 2025, with the Average Daily Rate (ADR) rising by 0.8% and occupancy rates improving by 0.5 percentage points [1] - In the Americas, RevPAR grew by 0.3%, while the Europe, Middle East, Africa, and Asia (EMEAA) markets saw a growth of 4.6%. However, the Greater China market experienced a decline of 1.6% [1] Expansion and Growth - The CEO of InterContinental Hotels Group, Elie Maalouf, indicated that the demand for the group's brands from global owners continues to grow, leading to a record opening of 443 new hotels in 2025 and an additional 694 hotels under construction [1] - The Greater China market achieved the highest level of hotel openings and signings in its history [1] - The group currently operates over 6,900 hotels worldwide, with nearly 2,300 hotels in the pipeline, which represents approximately 33% growth potential for the current system size [1]

Financial Performance - The company reported a total revenue of $5,189 million for 2025, reflecting a year-on-year increase [55]. - Operating profit for 2025 was $1,198 million, with adjusted EPS at 490.9 cents [55]. - IHG's operating profit increased by 15% year-on-year to $1,198 million, with adjusted EPS growing by 16%, surpassing the target of 12%-15% average annual growth [99]. - IHG's total revenue for 2025 was $5,189 million, with fee business revenue contributing $1,897 million and an operating profit of $1,231 million [169]. - In 2025, the fee margin increased by 360bps, driven by operating leverage and cost efficiency actions, exceeding the expected 100–150bps annual improvement [182]. Shareholder Returns - The company returned $1.1 billion to shareholders through a share buyback program and ordinary dividends in 2025 [32]. - A total dividend of 184.5 cents was proposed for 2025, an increase from 167.6 cents in 2024 [31]. - A final dividend of 125.9 cents per ordinary share was recommended, marking a 10% increase from the previous year, contributing to a total dividend of 184.5 cents for the year [36]. - The company successfully completed a $900 million share buyback program in December 2025, with a further $950 million buyback approved for 2026 [36]. - A $950 million share buyback program was approved for 2026, indicating continued shareholder return strategies [33]. Strategic Initiatives - IHG's acquisition of Ruby™ and the launch of the Noted Collection™ brand were key strategic moves to enhance its portfolio [23]. - The company emphasized the importance of talent retention and revised its Directors' Remuneration Policy to attract senior talent [34]. - IHG's governance structure was strengthened with the appointment of Nicholas Cadbury as Non-Executive Director, bringing expertise in hospitality and technology [30]. - IHG's technology initiatives, including AI-driven revenue management systems, are enhancing guest experiences and operational efficiencies across the enterprise [89]. - AI technologies are being integrated into IHG's operations, enhancing customer service and optimizing pricing and staffing models [141]. Growth and Expansion - IHG opened a record number of hotels in 2025, surpassing one million open rooms and adding almost 2,300 hotels to its development pipeline [18]. - A record 443 hotels were opened in 2025, with an additional 694 properties signed into the pipeline, bringing the total pipeline to 2,292 properties [53][73]. - The company achieved a net system size growth of 4.7% after adjusting for the removal of 7,092 rooms previously affiliated with The Venetian Resort Las Vegas [55][71]. - IHG's system size reached 1,026,177 rooms, with a development pipeline of 339,526 rooms, indicating robust expansion plans [165][167]. - IHG aims to surpass 50 open hotels in India and reach 100 open and pipeline hotels in Saudi Arabia, demonstrating commitment to key growth markets [152]. Loyalty Programs - The IHG One Rewards loyalty program grew to over 160 million members, with bookings accounting for 66% of all room nights globally [48]. - The loyalty program, IHG One Rewards, grew to over 160 million members in 2025, accounting for 66% of global room nights consumed [200]. - Approximately 85% of consumers are more likely to use a brand if they are members of its loyalty program, emphasizing the importance of loyalty initiatives [134]. - IHG's strategy includes adapting loyalty programs to regional expectations and enhancing guest experiences through tailored offerings [146]. Sustainability and Community Engagement - IHG's focus on sustainability progressed with its Journey to Tomorrow responsible business plan, reflecting its commitment to community care [25]. - The company supported 5.4 million people globally through its partnership with Action Against Hunger since its launch in 2024 [86]. Market Trends - The global consumer class is projected to spend $62 trillion in 2025, increasing to $80 trillion by 2030, indicating strong growth potential for the hotel industry [129]. - Global hotel room net new supply grew at an annual rate of 2.3% from 2015 to 2025, highlighting ongoing demand in the sector [130]. - The hotel industry has outpaced GDP growth, with global hotel revenues continuing to show resilience despite macroeconomic uncertainties [135].

Core Viewpoint - IHG Hotels & Resorts is presenting its 2025 Full Year Results, highlighting key financial metrics and future outlooks [1][2]. Financial Highlights - The presentation will include non-GAAP financial measures, with reconciliations available in the accompanying results announcement and SEC filings [2]. Investor Relations - Stuart Ford, Senior VP & Head of Investor Relations, introduces the presentation and emphasizes the importance of forward-looking statements as per U.S. law [1].

Core Insights - InterContinental Hotels Group (IHG) has launched a new premium collection brand called Noted Collection, aimed at expanding its presence in the upscale and upper-upscale hotel segment through property conversions [1][4] - The Noted Collection is IHG's 21st brand and is projected to grow to over 150 hotels globally within the next ten years [1] Group 1: Brand Strategy - The initial rollout of the Noted Collection will focus on Europe, the Middle East, Asia, and Africa before expanding to other regions [2] - This brand will be positioned within IHG's premium portfolio alongside existing brands such as Crowne Plaza, voco, and Ruby, complementing Hotel Indigo and Vignette Collection [2] Group 2: Target Market - The Noted Collection is designed for independent hotels that wish to maintain their unique identity while benefiting from IHG's infrastructure, including revenue management tools and access to over 160 million IHG One Rewards loyalty members [3][5] - IHG identifies a significant opportunity for expansion through conversions, with approximately 2.3 million independent rooms available worldwide in relevant segments [5] Group 3: Operational Benefits - Hotels joining the Noted Collection will retain their individual characteristics while gaining access to IHG's enterprise resources and loyalty program [6] - The brand aims to provide a distinctive and attractive option for owners of high-quality, unique hotels, enhancing their performance through IHG's platforms and expertise [5]

Core Insights - The InterContinental Hotels Group reported a 0.1% year-on-year increase in revenue per available room (RevPAR) for Q3 2025, with a total system size surpassing 1.011 million rooms, marking a historical high. The company anticipates that its annual profits and revenues will meet market expectations and plans to return over $1.1 billion to shareholders through share buybacks and dividends [1][5]. Performance Overview - Global RevPAR showed a slight increase of 0.1% in Q3, with a cumulative growth of 1.4% for the first three quarters. The EMEAA markets performed strongly with a RevPAR growth of 2.8% in Q3 and 3.8% for the first three quarters. The Americas market saw a decline of 0.9% in Q3 but still achieved a 0.8% growth for the first three quarters. The Greater China market experienced a 1.8% decline in Q3, an improvement from the 3.2% decline in the first half of the year [2]. Demand Structure Changes - Business travel demand increased by 4%, while leisure and group travel declined by 2% and 4% respectively, indicating a shift in short-term travel preferences [3]. Project Development - The company accelerated its system expansion, opening 14,500 new rooms (99 hotels) in Q3, a 17% year-on-year increase. The total number of rooms in the global system reached 1.011 million, covering 6,845 hotels. The company signed contracts for 22,600 new rooms (170 hotels), reflecting an 18% year-on-year growth. There are currently 342,000 rooms (2,316 hotels) under construction, representing 34% of the existing scale. The company plans to launch new high-end brands in the coming months to further enrich its product matrix [4]. Financial Movements - As of 2025, the company completed $700 million of its $900 million share buyback plan, reducing the number of shares by approximately 3.9%. It expects to return over $1.1 billion to shareholders through buybacks and dividends for the year [5]. Operational Status - For the first half of 2025, total revenue reached $2.519 billion, a year-on-year increase of 8%, while operating profit was $623 million, up 19% [6]. The adjusted free cash flow for the first half was $302 million, with net cash flow from operating activities at $312 million. In the Greater China region, the total number of opened and under-construction hotels exceeded 1,400, with the voco brand achieving its 100th hotel opening globally [7]. Strategic Outlook - CEO Keith Barr stated that the company's diversified global business model demonstrates resilience, with strong performance in the EMEAA markets and a clear improvement trend in the Greater China region. 2025 is expected to be one of the largest years for hotel openings and signings, and the company is confident in achieving its annual performance targets [8].

Financial Performance - Operating profit from reportable segments increased by 13% to $1,265 million, with adjusted EPS rising by 16% to 501.3¢[3] - Total revenue for the year reached $5,189 million, a 5% increase from the previous year[4] - Adjusted EBITDA rose by 12% to $1,332 million, with a net debt to adjusted EBITDA ratio of 2.5x[9] - Revenue from reportable segments increased by 6.7% to $2.468 billion in 2025, with total revenue rising by 5.4% to $5.189 billion[54] - Operating profit from reportable segments grew by 12.5% to $1.265 billion, with fee business operating profit increasing by 13.5% to $1.231 billion[54] - Adjusted free cash flow was $893m, an increase of $238m from the prior year[87] - Operating profit increased by $157m to $1,198m, including $21m in exceptional costs related to the global efficiency programme[59] - The fee margin for the total business improved to 64.8% in 2025 from 61.2% in 2024[199] Shareholder Returns - A new $950 million share buyback program was launched, expected to return over $1.2 billion to shareholders in 2026[9] - The company returned approximately $900 million to shareholders through the 2025 share buyback program, enhancing earnings per share[38] - The ordinary dividend grew by +10%, consistent with growth rates delivered over the past three years[38] - The Board proposed a final dividend of 125.9¢, a 10% increase from 2024, leading to a total dividend of 184.5¢ for the year[78] - A $900 million share buyback program was completed in 2025, repurchasing 7.6 million shares, with a new $950 million buyback program announced for 2026[51] Growth and Expansion - The company opened a record 443 hotels and added 694 hotels to its pipeline, representing a system growth of 33%[6] - The global hotel system reached 1,026,177 rooms across 6,963 hotels, with a gross system growth of +6.6% year-over-year in 2025[24] - Net system growth was +4.7% after adjusting for the removal of 26,026 rooms, with a reported growth of +4.0%[25] - A total of 102,054 rooms were signed in 2025, representing a +9% year-over-year increase[25] - The global pipeline consists of 340,000 rooms (2,292 hotels), which is 33% of the current system size and shows a +4% year-over-year growth[30] - The global pipeline totaled 339,526 rooms across 2,292 hotels, an increase of 14,274 rooms year-on-year[101] - In Greater China, gross system growth was +11.5% for the year, with 22.2k rooms (118 hotels) opened, including 4.5k rooms (25 hotels) in Q4[138] Strategic Initiatives - The launch of the new premium brand, Noted Collection, and the acquisition of the Ruby brand are key strategies to enhance the portfolio[7] - The new premium collection brand, Noted Collection, was launched to target the upscale market, with initial discussions for multiple hotel additions already underway[39] - Acquisition of Ruby brand in February 2025, adding 20 open hotels and a pipeline of 16 hotels, with plans for expansion in the US and internationally[42] - The company continues to focus on strategic investments, including maintenance capital expenditure and System Fund capital investments, to drive growth at the hotel level[188] Market Performance - Global RevPAR grew by 1.5%, with the Americas at 0.3%, EMEAA at 4.6%, and Greater China at -1.6%[9] - Global RevPAR increased by 1.5% for the full year, with net system size growing by 4.0% year-on-year to 1,026,177 rooms[57] - Comparable RevPAR in Greater China declined by -1.6%, with occupancy up by +0.5 percentage points and average rate down by -2.4%[135] - RevPAR growth at constant exchange rates was 1.5% for the full year 2025, with a 4.6% increase in the EMEAA region[96] Debt and Liquidity - Net debt increased by 20% to $3,333 million, driven by over $1.1 billion in shareholder returns and $120 million in acquisition spend[4] - IHG's net debt to adjusted EBITDA ratio was 2.5x at the end of 2025, within the target range of 2.5-3.0x[51] - Total liquidity as of December 31, 2025, was $2,599 million, an increase of $280 million from December 31, 2024, primarily due to net additional bond funding of $587 million[90] Digital and Innovation - Direct digital booking channels contributed over 26% of total room revenue, with 9 million app downloads in 2025[45] - AI-driven innovations led to 5.1 million chatbot conversations in 2025, a 40% increase, enhancing customer satisfaction and operational efficiency[48] - New Revenue Management System rolled out to 6,800 hotels, providing advanced insights and revenue uplift opportunities for owners[45] Environmental and Social Responsibility - IHG achieved a -10.2% reduction in energy per available room and an -11.0% reduction in carbon emissions per available room in 2025 compared to 2019[53]