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Revenue | 12 Months Ended
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Dec. 31, 2021
Text Block [Abstract] |
Revenue | 3. Revenue Disaggregation of revenue
Year ended 31 December 2021 |  |  |  | Americas $m |  | EMEAA $m |  | Greater China $m |  | Central $m |  | Group $m |
Franchise and base management fees |  |  |  | 683 |  | 120 |  | 91 |  | – |  |  | 894 |
Incentive management fees |  |  |  | 8 |  | 29 |  | 25 |  | – |  |  | 62 |
Central revenue |  |  |  | – |  | – |  | – |  | 197 |  |  | 197 |
Revenue from fee business |  |  |  | 691 |  | 149 |  | 116 |  | 197 |  |  | 1,153 |
Revenue from owned, leased and managed lease hotels |  |  |  | 83 |  | 154 |  | – |  | – |  |  | 237 |
|  |  |  | 774 |  | 303 |  | 116 |  | 197 |  |  | 1,390 |
System Fund revenues (note 33) |  |  |  |  |  |  |  |  |  |  |  |  | 928 |
Reimbursement of costs |  |  |  |  |  |  |  |  |  |  |  |  | 589 |
Total revenue |  |  |  |  |  |  |  |  |  |  |  |  | 2,907 |
Year ended 31 December 2020 |  |  |  | Americas $m |  | EMEAA $m |  | Greater China $m |  | Central $m |  | Group $m |
Franchise and base management fees |  |  |  | 452 |  | 93 |  | 61 |  | – |  |  | 606 |
Incentive management fees |  |  |  | 5 |  | 14 |  | 16 |  | – |  |  | 35 |
Central revenue |  |  |  | – |  | – |  | – |  | 182 |  |  | 182 |
Revenue from fee business |  |  |  | 457 |  | 107 |  | 77 |  | 182 |  |  | 823 |
Revenue from owned, leased and managed lease hotels |  |  |  | 55 |  | 114 |  | – |  | – |  |  | 169 |
|  |  |  | 512 |  | 221 |  | 77 |  | 182 |  |  | 992 |
System Fund revenues (note 33) |  |  |  |  |  |  |  |  |  |  |  |  | 765 |
Reimbursement of costs |  |  |  |  |  |  |  |  |  |  |  |  | 637 |
Total revenue |  |  |  |  |  |  |  |  |  |  |  |  | 2,394 |
Year ended 31 December 2019 |  |  |  | Americas $m |  | EMEAA $m |  | Greater China $m |  | Central $m |  | Group $m |
Franchise and base management fees |  |  |  | 840 |  | 247 |  | 87 |  | – |  |  | 1,174 |
Incentive management fees |  |  |  | 13 |  | 90 |  | 48 |  | – |  |  | 151 |
Central revenue |  |  |  | – |  | – |  | – |  | 185 |  |  | 185 |
Revenue from fee business |  |  |  | 853 |  | 337 |  | 135 |  | 185 |  |  | 1,510 |
Revenue from owned, leased and managed lease hotels |  |  |  | 187 |  | 386 |  | – |  | – |  |  | 573 |
|  |  |  | 1,040 |  | 723 |  | 135 |  | 185 |  |  | 2,083 |
System Fund revenues (note 33) |  |  |  |  |  |  |  |  |  |  |  |  | 1,373 |
Reimbursement of costs |  |  |  |  |  |  |  |  |  |  |  |  | 1,171 |
Total revenue |  |  |  |  |  |  |  |  |  |  |  |  | 4,627 |
In 2020, following communication with the IHG Owners Association, fees and expenses associated with the InterContinental Ambassador programme (the InterContinental Hotels & Resorts paid-for loyalty programme) previously reported within Central revenue were moved into the System Fund to align with the treatment of IHG’s other brand loyalty programmes. Revenue arising from the licence of intellectual property under co-brand credit card agreements previously recorded within the System Fund was moved into Central revenue. This change was effective from 1 January 2020. For the year ended 31 December 2020, this change resulted in an increase of $20m to Central revenue and $21m to operating profit from reportable segments, and an equivalent reduction to System Fund revenues and increase to System Fund operating loss. Had this arrangement existed in 2019, Central revenue and operating profit in 2019 would have been $18m and $22m higher respectively; System Fund revenues would have reduced and System Fund operating loss would have increased by the same amounts. Contract balances
|  |  |  | 2021 $m |  |  |  |  | 2020 $m |
Trade receivables (note 18) |  |  |  |  | 399 |  |  |  |  |  | 309 |
Contract assets |  |  |  |  | 346 |  |  |  |  |  | 336 |
Deferred revenue |  |  |  |  | (1,613 | ) |  |  |  |  | (1,569 | )
Contract assets
|  |  |  | 2021 $m |  |  |  |  | 2020 $m |
At 1 January |  |  |  |  | 336 |  |  |  |  |  | 334 |
Additions |  |  |  |  | 45 |  |  |  |  |  | 74 |
Recognised as a deduction to revenue |  |  |  |  | (35 | ) |  |  |  |  | (25 | )
Impairment charges |  |  |  |  | – |  |  |  |  |  | (53 | )
Repayments |  |  |  |  | (1 | ) |  |  |  |  | – |
Exchange and other adjustments |  |  |  |  | 1 |  |  |  |  |  | 6 |
At 31 December |  |  |  |  | 346 |  |  |  |  |  | 336 |
Analysed as: |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  | 30 |  |  |  |  |  | 25 |
Non-current |  |  |  |  | 316 |  |  |  |  |  | 311 |
|  |  |  |  | 346 |  |  |  |  |  | 336 |
The Group also has future commitments for key money payments which are contingent upon future events and may reverse. At 31 December 2021, the maximum exposure remaining under performance guarantees was $85m (2020: $72m). In 2020, impairment of contract assets related primarily to deposits made to Service Properties Trust (‘SVC’) of $33m. The remaining impairment of $20m related to key money and performance guarantee payments on individual properties which were tested with reference to future franchise and management fees. Of the total impairment including SVC balances, $42m related to the Americas region and $11m to the EMEAA region. Deferred revenue
|  |  |  |  | Loyalty programme $m |  |  | Other co-brand fees $m |  |  | Application & re-licensing fees $m |  |  | Other $m |  |  | Total $m |
At 1 January 2020 |  |  |  |  |  |  | 1,233 |  |  |  | 66 |  |  |  | 172 |  |  |  | 93 |  |  |  | 1,564 |
Increase in deferred revenue |  |  |  |  |  |  | 344 |  |  |  | – |  |  |  | 14 |  |  |  | 45 |  |  |  | 403 |
Recognised as revenue |  |  |  |  |  |  | (332 | ) |  |  | (11 | ) |  |  | (20 | ) |  |  | (39 | ) |  |  | (402 | )
Exchange and other adjustments |  |  |  |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 4 |  |  |  | 4 |
At 31 December 2020 |  |  |  |  |  |  | 1,245 |  |  |  | 55 |  |  |  | 166 |  |  |  | 103 |  |  |  | 1,569 |
Increase in deferred revenue |  |  |  |  |  |  | 384 |  |  |  | – |  |  |  | 19 |  |  |  | 45 |  |  |  | 448 |
Recognised as revenue |  |  |  |  |  |  | (337 | ) |  |  | (11 | ) |  |  | (22 | ) |  |  | (35 | ) |  |  | (405 | )
Exchange and other adjustments |  |  |  |  |  |  | – |  |  |  | – |  |  |  | – |  |  |  | 1 |  |  |  | 1 |
At 31 December 2021 |  |  |  |  |  |  | 1,292 |  |  |  | 44 |  |  |  | 163 |  |  |  | 114 |  |  |  | 1,613 |
Analysed as: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  | 535 |  |  |  | 11 |  |  |  | 21 |  |  |  | 50 |  |  |  | 617 |
Non-current |  |  |  |  |  |  | 757 |  |  |  | 33 |  |  |  | 142 |  |  |  | 64 |  |  |  | 996 |
|  |  |  |  |  |  | 1,292 |  |  |  | 44 |  |  |  | 163 |  |  |  | 114 |  |  |  | 1,613 |
At 31 December 2020: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  |  |  | 376 |  |  |  | 11 |  |  |  | 22 |  |  |  | 43 |  |  |  | 452 |
Non-current |  |  |  |  |  |  | 869 |  |  |  | 44 |  |  |  | 144 |  |  |  | 60 |  |  |  | 1,117 |
|  |  |  |  |  |  | 1,245 |  |  |  | 55 |  |  |  | 166 |  |  |  | 103 |  |  |  | 1,569 |
This table does not include amounts which were received and recognised as revenue in the same year. Amounts recognised as revenue were included in deferred revenue at the beginning of the year. Loyalty programme revenues, shown gross in the table above, are presented net of the corresponding redemption cost in the Group income statement. Other deferred revenue includes technical service fees and guest deposits received by owned, leased and managed lease hotels. Transaction price allocated to remaining performance obligations The Group has applied the practical expedient in IFRS 15 not to disclose the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied or partially unsatisfied as at the end of the reporting period for all amounts where the Group has a right to consideration in an amount that corresponds directly with the value to the customer of the Group’s performance completed to date (including franchise and management fees). Amounts received and not yet recognised relating to performance obligations that were unsatisfied at the year end are as follows:
|  |  |  |  | 2021 |  |  |  |  |  | 2020 |
|  |  |  |  | Loyalty and co-brand $m |  |  | Other $m |  |  | Total $m |  |  |  |  |  | Loyalty and co-brand $m |  |  | Other $m |  |  | Total $m |
Expected timing of recognition |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Less than one year |  |  |  |  |  |  | 546 |  |  |  | 71 |  |  |  | 617 |  |  |  |  |  |  |  | 387 |  |  |  | 65 |  |  |  | 452 |
Between one and two years |  |  |  |  |  |  | 406 |  |  |  | 45 |  |  |  | 451 |  |  |  |  |  |  |  | 313 |  |  |  | 40 |  |  |  | 353 |
Between two and three years |  |  |  |  |  |  | 155 |  |  |  | 33 |  |  |  | 188 |  |  |  |  |  |  |  | 249 |  |  |  | 29 |  |  |  | 278 |
Between three and four years |  |  |  |  |  |  | 98 |  |  |  | 25 |  |  |  | 123 |  |  |  |  |  |  |  | 176 |  |  |  | 24 |  |  |  | 200 |
Between four and five years |  |  |  |  |  |  | 53 |  |  |  | 22 |  |  |  | 75 |  |  |  |  |  |  |  | 73 |  |  |  | 22 |  |  |  | 95 |
More than five years |  |  |  |  |  |  | 78 |  |  |  | 81 |  |  |  | 159 |  |  |  |  |  |  |  | 102 |  |  |  | 89 |  |  |  | 191 |
|  |  |  |  |  |  | 1,336 |  |  |  | 277 |  |  |  | 1,613 |  |  |  |  |  |  |  | 1,300 |  |  |  | 269 |  |  |  | 1,569 |
Contract costs
|  |  |  | 2021 $m |  |  |  |  | 2020 $m |
At 1 January |  |  |  |  | 75 |  |  |  |  |  | 72 |
Costs incurred |  |  |  |  | 11 |  |  |  |  |  | 11 |
Amortisation |  |  |  |  | (9 | ) |  |  |  |  | (9 | )
Exchange and other adjustments |  |  |  |  | – |  |  |  |  |  | 1 |
At 31 December |  |  |  |  | 77 |  |  |  |  |  | 75 |
Analysed as: |  |  |  |  |  |  |  |  |  |  |  |
Current |  |  |  |  | 5 |  |  |  |  |  | 5 |
Non-current |  |  |  |  | 72 |  |  |  |  |  | 70 |
|  |  |  |  | 77 |  |  |  |  |  | 75 |

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