Ladies and gentlemen, thank you very much for standing by and welcome to the IHG Full Year 2017 Results Call. I'm now going to hand the call over to Catherine Dolton to begin.

Good morning, everyone. This is Catherine Dolton, Head of Investor Relations at IHG. I'm joined this morning by Keith Barr, Chief Executive; and Paul Edgecliffe-Johnson, Chief Financial Officer. Before I hand over to them for the discussion of our results, I need to remind you that in the following discussion, the company may make certain forward-looking statements as defined under U.S. law. Please check this morning's press release and the company's SEC filings for factors that could lead actual results to differ materially from any such forward-looking statements. I will now turn the call over to Keith Barr.

Thanks, Catherine. Good morning, everyone, and welcome to our 2017 full year results call. Paul will talk you through our financial performance in a moment, but let me first share some highlights. We delivered another year of strong performance in 2017. Solid RevPAR increases in the U.S. and globally, as well as a 4% net system size growth, our best since 2009, drove underlying fee revenue up by 5%. We again expanded our fee margin, increased underlying earnings per share by 22%. And our disciplined use of capital and high quality fee streams continue to generate significant levels of cash flow. Reflecting the strong performance and our confident outlook, we have increased our total annual ordinary dividend by 11%. Back at August last year, I talked about the success of IHG's strategic model and the crucial role that this has played in our consistent market outperformance over the past few years. I also talked about my intention to work our model harder in the future. And so today, we are announcing a series of new strategic initiatives, which represent a meaningful change in how we run our business. They're aimed at positioning us to deliver industry-leading net rooms growth over the medium term, as well as continued strong returns for our shareholders. In order to fund these plans we are undertaking a comprehensive company-wide efficiency program, which we started in August 2017. The program will realize a $125 million in annual savings across IHG's P&L and system fund for reinvestment by the end of 2020. Over that period, our disciplined approach to managing our balance sheet and capital allocation will remain unchanged. We are confident that these actions will enable us to deliver a quality long-term sustainable growth in cash flows and continue our record for maximizing shareholder returns. Let me now hand over to Paul, who will first take you through our results for 2017.

Thank you, Keith, and good morning, everyone. We're pleased to report another year of solid financial performance with growth in all our key metrics. On an underlying basis, we translated 5% revenue growth into 8% operating profit growth, by leveraging the scalability of our assets by business and continuing our focus on relentless cost management. This allowed us to increase our underlying fee margin by 140 basis points year on year, while continuing to invest for growth. Interest charges fell by $3 million. Due to the impact of the weaker pound a reduction on our bond coupon, following our refinancing in 2016, offset by higher average net debt levels during the year. Our reported tax rate stayed at 30%. We continue to expect U.S. tax reform to benefit our group effective tax rate by mid to high single digit percentage points from the January 1, 2018, taking it to mid to low 20%s. This benefit will flow through to our cash tax rate, which we now expect to be in the high single digit percentage range in 2018, due to tax payments made on account in 2017. This will trend closer to the P&L rate over time. The measures outlined in the U.S. tax bill also resulted in a one-off exceptional credit to the P&L of $108 million in 2017, most of which relates to the rebasing for our deferred tax liabilities. This will be realized in cash terms over a long period from 2018. The weighted average number of shares decreased by 9%, due to the cumulative effect of the share consolidations following the special dividend payments made in May 2016 and May 2017. In aggregate, this performance enabled us to increase our underlying earnings per share by 22%. We added 48,000 rooms to the systems and at the…

Thanks, Paul. I want to spend a moment giving you a sense of the broader context against, which we're announcing our new strategic initiatives. The success of our strategy to date has been borne out in our financial results. We've grown our rooms faster than the industry, driven double-digit fee revenue growth and increased earnings per share more than 50% over the past three years. We've also consistently delivered against our key commercial metrics, driving meaningful improvements in Guest Love, loyalty contribution and system delivery which has driven superior returns for our hotel owners. But we are not complacent. We know that we must continue the strong performance for years to come. With our powerful global enterprise, which is driving strong performance across our full estate, IHG is well positioned to continue to grow, but the competition is not standing still. That's why we're implementing new strategic initiatives to accelerate our growth. We'll do this, by making each element of our model work harder. In summary, we will be focusing and redeploying resources to better leverage our scale, strengthening our loyalty program, continuing to prioritize digital and technological innovation, and enhancing our industry leading franchise proposition, strengthening our existing brands and adding new ones, where we see the greatest potential for growth. Back in September 2017, we announced several changes to our operating structure, which became effective on the January 1 this year. Firstly, within our regional operations we brought together two of our current divisions, Europe and Asia, Middle East and Africa, whilst leaving our Greater China and America regions largely unchanged. In what is a highly fragmented region, accessing growth opportunities in EMEAA means upweighting our investment in those individual submarkets that matter the most to IHG both in terms of overall value, but also where we can…

Thank you very much. Apologies [Operator Instructions] Our first question comes from the line of Patrick Scholes with Suntrust. Patrick, please go ahead.

Hi, good morning, good afternoon.

Hi, Patrick.

I'd like to ask some questions on the Kimpton brand. Certainly, looking at the results over the past year, it's been a big underperformer. And you laid out some - as far as the upcoming strategy, it seemed a little heavy on the brand expansion. I'm wondering can you drill down a little bit more on what is being done to improve the RevPAR index from that brand. Certainly, there is a - I'm sure you're probably aware that a lot of chatter at the ALIS conference, very unhappy Kimpton owners, and certainly chatter that the integration, the reservation system did not go well in January. I wonder if you can comment on those. Thank you.

Sure. I'd be happy to talk about that, Patrick. I guess, let me break it out from an owner perspective and from an IHG perspective in terms of - from an underperformance standpoint, in fact, actually the Kimpton brand in its entirety grew its RevPAR index last year in the Americas and had some very, very strong results. And so, I guess, I would say that from a financial performance the Kimpton brand has been performing exceptionally well and performing very, very well for the owners overall. And from a group perspective, we've been accelerating the growth of that brand internationally. We've now have the signings in China, in Indonesia, in Taiwan and so forth. So from a group perspective, we're focused on accelerating the growth there. Coming back to the integration question you brought up, it's been a long-term integration. In all transparency, when the conversion over from Synxis [ph] system, which is the platform that Kimpton was on, on to the IHG system, which is not what's happening with the rest of the people on GRS. There were a few challenges in the first few weeks, which we've been sorting out and working through with all the owners too. And I generally believe that we're on track now from a system perspective and loyalty integration standpoint. So anytime you're changing from a third party system into a new system, there are some challenges, so those definitely did occur. But we've been working very closely with the Kimpton owners. We've been upweighting our investment behind marketing, sales, and loyalty to drive performance across that portfolio right now.

Okay. That was all for me. Thank you very much.

[Operator Instructions] It appears we have no further questions on the telephone.

Excellent. Well, fantastic then, Danielle. Thank you very much. Really appreciate you hosting this. And thanks everyone for joining the call and look forward to catching up with you later on in the year. Thank you. That's it operator.

Thank you very much. Ladies and gentlemen, that does conclude the IHG call. This call has come to a close. And you can now disconnect your lines.