IHG half-year results 2026: profit, pipeline and shareholder returns grow

InterContinental Hotels Group PLC has reported a strong first half of 2026, combining higher hotel demand with record development activity, margin expansion and another sizeable return of capital to shareholders.

The owner of brands including InterContinental, Holiday Inn and Crowne Plaza increased operating profit from reportable segments by 10% to $665 million. Adjusted earnings per share rose 13% to 274.7 cents, while the interim dividend increased by 10%.

IHG also reiterated that it remains on track to meet full-year consensus profit and earnings expectations, despite disruption from the conflict in the Middle East.

IHG's first-half figures at a glance

Metric	H1 2026	H1 2025	Change
Revenue from reportable segments	$1,255 million	$1,175 million	+7%
Fee business revenue	$971 million	$908 million	+7%
Operating profit from reportable segments	$665 million	$604 million	+10%
Fee margin	65.9%	64.7%	+1.2 percentage points
Adjusted EPS	274.7 cents	242.5 cents	+13%
IFRS operating profit	$671 million	$623 million	+8%
Basic EPS	283.3 cents	300.1 cents	-6%
Interim dividend per share	64.5 cents	58.6 cents	+10%
Adjusted free cash flow	$360 million	$302 million	+19%
Net debt	$3,663 million	$3,361 million	+9%

The standout feature is the combination of revenue growth and operating leverage. Fee business revenue increased by 7%, while the related cost base rose by 4%. This pushed the fee margin, a measure of profitability within IHG's fee-based operations, up from 64.7% to 65.9%.

That matters because IHG mainly operates an asset-light model. Rather than owning most of its hotels, it earns fees from properties owned by franchisees and other third parties. Growing the hotel network can therefore add revenue without requiring IHG to fund the full cost of each new property.

Hotel demand remained supportive

Global revenue per available room, or RevPAR, increased by 4.1%. RevPAR combines room prices and occupancy, making it a widely used measure of hotel trading performance.

Average daily room rates rose by 2.5%, while occupancy improved by one percentage point.

Region	H1 RevPAR growth
Americas	+4.8%
EMEAA	+3.0%
Greater China	+3.1%
Global	+4.1%

The Americas delivered the strongest regional growth. US RevPAR accelerated from 3.4% in the first quarter to 5.2% in the second. FIFA World Cup match locations provided an estimated one percentage point benefit to Americas RevPAR growth during the second quarter.

Group travel was particularly strong in the Americas, with comparable rooms revenue up 10%. Leisure increased by 4% and business travel by 3%.

Performance was more mixed in Europe, the Middle East, Asia and Africa. EMEAA RevPAR growth slowed from 5.6% in the first quarter to 0.6% in the second as the Middle East conflict affected travel. The Middle East sub-region recorded a 19% second-quarter decline, although it represents only 5% of IHG's global system.

Trading outside the Middle East remained positive, including second-quarter RevPAR growth of 3.1% in the UK, 2.3% in Continental Europe and 6.0% in East Asia and the Pacific.

Record hotel openings strengthen the growth case

IHG opened 31,500 rooms across 197 hotels during the half, a record level. Excluding the effect of the Ruby brand acquisition, openings increased by 8% year on year.

After removing 8,946 rooms from the system, net system growth reached 5%. IHG finished June with 1,048,731 rooms across 7,109 hotels.

Development activity also remained healthy:

• 49,196 rooms across 352 hotels were signed during the half
• Organic signings increased by 8%
• The pipeline reached 347,691 rooms across 2,385 hotels
• The pipeline is equivalent to 33% of IHG's existing system
• Around half of the pipeline is already under construction
• Conversions represented 43% of openings and 49% of signings

Greater China was the fastest-growing region by system size, with net room growth of 11.7%. EMEAA grew by 6.3%, while the Americas increased by 1.8%.

Conversions are useful because an existing hotel can join an IHG brand more quickly than a new property can be built. They can support faster fee growth, although IHG still needs to convince owners that its brands, loyalty programme and technology justify the associated fees.

Cash generation funded substantial shareholder returns

Adjusted free cash flow rose by $58 million to $360 million, supported by higher profit. Net cash from operating activities increased from $312 million to $355 million.

IHG plans to return more than $1.2 billion to shareholders during 2026 through dividends and share buybacks. The $950 million buyback programme was 42% complete at the end of June, with $397 million spent repurchasing 2.7 million shares.

The interim dividend increased by 10% to 64.5 cents per share. It is due to be paid on 1 October 2026, with the sterling amount to be announced on 11 September.

Buybacks reduce the number of shares across which earnings are divided. IHG's weighted average share count fell by 4%, helping adjusted EPS grow faster than adjusted earnings, which increased by 9%.

Why did statutory earnings per share fall?

The weaker basic EPS figure is an important wrinkle in an otherwise strong set of results.

Basic EPS declined by 6% to 283.3 cents, while profit before tax fell by 9% to $578 million. The main difference was foreign exchange. IHG recorded a $7 million foreign exchange loss in the latest period, compared with a $79 million gain a year earlier.

These movements mainly relate to translating monetary assets and liabilities held between subsidiaries with different functional currencies. They do not change the positive underlying progress, but investors should not ignore the statutory decline.

Debt and regional disruption are the main watchpoints

Net debt increased by $330 million from the start of the year to $3,663 million. This largely reflected $564 million of dividend and buyback payments.

The net debt to adjusted EBITDA ratio was 2.63 times, within IHG's target range of 2.5 to 3.0 times. Liquidity remained substantial at $2,298 million, including $1,500 million of undrawn bank facilities.

However, higher borrowing has a cost. Adjusted interest expense increased by 16% to $106 million, and IHG now expects a full-year expense of $230 million to $240 million.

The Middle East is another clear risk. Management expects disruption there and its effect on wider international travel flows to be fully offset by demand growth elsewhere, but that outcome is not guaranteed.

Investors can review the original company announcement for the complete financial statements and regional disclosures.

What investors should watch next

IHG's first half delivered progress across the main parts of its stated growth model: higher RevPAR, 5% net system growth, a wider fee margin, strong cash generation and fewer shares in issue.

The next test is whether that momentum continues while the company completes its buyback and keeps leverage inside its target range. Full-year fee cost growth is expected to remain within 1% to 3%, which would support further operating leverage if revenue continues rising.

For now, management remains confident about meeting consensus expectations. Future updates should show whether US demand stays firm, Middle East weakness remains contained and the record pipeline translates into sustained hotel openings and fee growth.