Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: Let's move on to shares of IHG. In the wake
Speaker 2: of the hotel operator announcing a nine hundred and fifty
Speaker 2: million dollars share buyback program. In its latest earnings, you
Speaker 2: can see shares rising a little bit here one and
Speaker 2: a half percent. The company also unfiled it's twenty first
Speaker 2: brand noted collection as it looks to attract more upscale
Speaker 2: customers this year. Joining us now exclusively to discuss is
Speaker 2: Ellie Malouf, the CEO of IHG. Ellie, great to have
Speaker 2: you with us. A lot to get into here, but
Speaker 2: I want to, of course start with the US and
Speaker 2: what you're seeing in that market, because we know it
Speaker 2: was a difficult end to twenty twenty five. The momentum
Speaker 2: that you've seen so far in twenty twenty six, what
Speaker 2: gives you the confidence to say that it will continue.
Speaker 3: Thank you for having me. It's great to be with you. First,
Speaker 3: I really do want to thank our teams around the
Speaker 3: world for what was an excellent financial performance last year.
Speaker 3: You saw a ref bark grew one and a half
Speaker 3: person and around the world or operating profit was up
Speaker 3: thirteen percent, or earnings per share up sixteen percent, and
Speaker 3: we're growing the company. We had a record over four
Speaker 3: hundred and forty hotel openings around the world. We added
Speaker 3: seven hundred, nearly seven hundred hotels to our pipeline. So
Speaker 3: the industry growing, our company is growing. We're confident about
Speaker 3: the future. With regard to the United States, there were some,
Speaker 3: let's just say, unexpected things last year that weighed on
Speaker 3: the industry, which we think come off this year. In
Speaker 3: twenty twenty six, you had some teriff anxiety, you had
Speaker 3: reduced government spending and travel. You had the longest on
Speaker 3: history government shutdown. You had reduced inbound travel to the
Speaker 3: US internationally. Now when you get into twenty twenty six,
Speaker 3: these things either don't happen or really just we comp
Speaker 3: over those. In fact, we get some positives like the
Speaker 3: World Cup, like US to fifty celebration. You got a
Speaker 3: very strong economy, a strong GDP growth exit rate from
Speaker 3: Q four really still record employment, job growth, but number
Speaker 3: of people employed is still at a record. Enormous capital
Speaker 3: spending by technology companies and other not just tech and AI,
Speaker 3: but you have energy infrastructure that's driving business growth. I mean,
Speaker 3: you put all these things together, it's hard not to
Speaker 3: be a little more positive in twenty twenty six about
Speaker 3: the US in twenty twenty five and what we've seen
Speaker 3: in the first month and a half in business in
Speaker 3: the US, but actually, frankly globally makes us more optimistic.
Speaker 2: Right, Well, let's talk a little bit more about the
Speaker 2: World Cup, because obviously there is a ton of excitement
Speaker 2: building for this summer. What do pass World Cups tell
Speaker 2: you about what the region could expect here in the
Speaker 2: US and what are you doing to prepare for that.
Speaker 3: I look, we're very prepared where in most of the
Speaker 3: major cities where they're going to be you know, football
Speaker 3: if you're using the global term, or soccer for using
Speaker 3: the US term, but are also very president in Canada
Speaker 3: and in Mexico where games are going to be played.
Speaker 3: We've got a lot of experience with global events. We're
Speaker 3: in one hundred countries. We're a global company that's very
Speaker 3: big in the United States, but we've got experience with
Speaker 3: all these major events. I mean, look, there are industry
Speaker 3: forecasts that say could add somewhere between forty to sixty
Speaker 3: basis points of RevPAR to growth this year. We haven't
Speaker 3: put out a forecast. We do think it's going to
Speaker 3: be a creative. We think it's one of many other
Speaker 3: things that are making the US out look stronger for
Speaker 3: twenty twenty six.
Speaker 1: I'm curious, so, Ellie, you have no concerns right now
Speaker 1: about some of the immigration issues here in the US
Speaker 1: potentially maybe dampening just how many people would actually travel,
Speaker 1: foreign travelers that is, into the US for these events.
Speaker 3: We haven't seen that. You know, our booking window isn't
Speaker 3: that long. The Games are still a few months away. Frankly,
Speaker 3: most companies in our business at our scale see somewhere
Speaker 3: between fifty to sixty percent of all their bookings in
Speaker 3: the last week. Now, long event bookings like this are
Speaker 3: start to come in months before. We're pleased with the
Speaker 3: bookings we're seeing in our major cities for the World Cup.
Speaker 3: It's a bit early really to make a forecast on it,
Speaker 3: but we're pleased. We're not seeing any resistance to come. Look,
Speaker 3: sports bring the world together, and that's always been the
Speaker 3: case no matter where the World Cup has been held.
Speaker 3: And keep in mind we're a global company. We're very
Speaker 3: focused in the United States. We think it's going to
Speaker 3: be more optimistic this year, but around the globe we're
Speaker 3: we're seeing positive trends in Europe, certainly the Middle East,
Speaker 3: where we have a very big business and that's growing.
Speaker 3: Southeast Asia has had a very good year in twenty
Speaker 3: two and five. That continues in China, which was a
Speaker 3: bit negative in ref par growth for the last two years,
Speaker 3: turned positive in Q four, a strong economy. We had
Speaker 3: record signings and openings in China last year. So really
Speaker 3: globally everything's taking shape for a better year in twenty
Speaker 3: twenty six.
Speaker 1: Well on that point, here are you seeing any material
Speaker 1: difference in demand for I guess your high properties versus low,
Speaker 1: So say something like a holiday in on the lower
Speaker 1: end of the p spectrum all the way up to
Speaker 1: you the intercontinentals, crowns, kemptons and those things on the
Speaker 1: higher end.
Speaker 3: Sure, Look, we pride ourselves on having a stay for everybody,
Speaker 3: and in twenty twenty five both Holiday and Halid Express
Speaker 3: had about positive year around the world. Now I'd say
Speaker 3: the upper end luxury had an even more positive year.
Speaker 3: That's been a trend going on for a couple of years.
Speaker 3: We think over time the mainstream travel, the middle class
Speaker 3: travel will converge, and some years you find that luxury
Speaker 3: does better than mainstream. Some years mainstream does better than luxury.
Speaker 3: There are strong structural drivers for both. In mainstream, the
Speaker 3: middle class is growing around the world. In China, the
Speaker 3: middle class is going to double the next ten years,
Speaker 3: in India, Southeast Asia, similar figures in the United States,
Speaker 3: and middle classes getting wealthier, and so the middle class
Speaker 3: is the heart of the business and that has strong
Speaker 3: structural drivers. At the upper end. At the luxury you've
Speaker 3: got two structural drivers. First, you've got an aging population.
Speaker 3: That's however aging and a healthier and wealthier condition, and
Speaker 3: one of the main things they want to do is travel.
Speaker 3: They prioritize live experiences over products, and they're living longer, healthier,
Speaker 3: and they want to travel more. So that's got a
Speaker 3: structural driver. I think both have a very good future.
Speaker 2: Well, Ellie, when it comes to the upper end, and
Speaker 2: we only have about a minute left with you, talk
Speaker 2: to us about where you see the Noted Collection launch
Speaker 2: sort of fitting into that portfolio.
Speaker 3: We're very pleased to launch Noted Collection today, our twenty
Speaker 3: first brand. It's going to be targeted in premium, which
Speaker 3: is between luxury and mainstream. Right there in the premium
Speaker 3: for business travelers, for leisure travelers. It's a collection brand.
Speaker 3: So start to collect iconic assets that already have a
Speaker 3: strong local presence, a strong following. But for owners that
Speaker 3: want to join a very strong system like ISG. We
Speaker 3: have one hundred and sixty million IC one Rewards members,
Speaker 3: we cover one hundred countries. We got best in class technology,
Speaker 3: leading AI driven revenue management system, all the powers that
Speaker 3: can make hotel performance stronger, while you can keep your
Speaker 3: own brand and your own identity as a property. So
Speaker 3: it's a collection for these iconic assets. It's going to
Speaker 3: be urban leisure. We're targeting about one hundred and fifty
Speaker 3: hotels over the next ten years, and we're optimistic about
Speaker 3: its growth.
Speaker 1: All right, Ellie, we have to leave it there. I
Speaker 1: really appreciate you joining us here, and I think we
Speaker 1: got to check back in as we get closer, of course,
Speaker 1: to what's going on with the World Cup here in
Speaker 1: North America. Elie maloof the CEO over at IHG