LONDON -- InterContinental Hotels Group (ISE: IHG.L) (NYS: IHG) , which counts Crowne Plaza and Holiday Inn among its nine hotel brands, reported a 6% increase in half-year profits this morning, up to $286 million from $269 million in 2011. The group saw double-digit revenue growth in both its European and Greater China operations, with its franchise business driving a 9% increase in operating profits within the Americas division.
Since its demerger from Six Continents during 2003, InterContinental has established a strong track record of returning cash to shareholders, and has announced plans to return a further $1 billion via a $500 million special dividend during Q4 2012, and a $500 million share-buyback program, which will start at the same time. The planned return of funds is driven by the anticipated proceeds from the sale of the InterContinental New York Barclay hotel.
Richard Solomons, chief executive, said:
Our brands continue to perform well and we have achieved solid underlying margin growth, resulting in increased profits and strong cash flows. We are increasing the interim dividend by 31% to reflect these results, our previously stated intention to rebalance the interim and final dividend payments, and our confidence in the future prospects of the business.
While the global economic environment remains uncertain, IHG continues to trade well and we are confident that our strategy will deliver high-quality growth into the future.
With InterContinental's London-traded shares up 5% to 17 pounds in early trading, this morning's news underlines how well-run companies can become rewarding investments for ordinary investors.
But if you're keen to earn even greater returns, this free Motley Fool report -- "10 Steps To Making A Million In The Market" -- could help you on your way. The report highlights how choppy markets can still provide the big winners to take you to that magic million.
You can download "10 Steps To Making A Million In The Market" for free right now. But hurry, the report is available for a limited time only.
Investing is by no means easy in today's uncertain economy. That's why we've published "Top Sectors Of 2012" -- our guide to three favorable industries. This free report will be dispatched immediately to your inbox.
Further Motley Fool investment opportunities
The article InterContinental Hotels to Return $1 Billion to Shareholders originally appeared on Fool.com.
Jon does not own any shares mentioned in this article. The Motley Fool has adisclosure policy.
We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.