April/ May 2023 MMM054 2022/3 A 800

Case study: InterContinental Hotels Group PLC

CASES IN FINANCIAL MANAGEMENT AND CONTROL (MMM054)

1. With reference to the case study material, your knowledge from this module, and trends and ratios from suggested table (See Appendix), critically discuss the financial performance and share price of InterContinental Hotels Group PLC over the 5-year period from 2017 to 2021. You should analyse the performance of the segments as well as the Group as a whole. (45 Marks)

2. Use case study material and your knowledge to analyse and comment on the dividend policy of InterContinental Hotels Group PLC. Refer to relevant dividend theories where appropriate. (15 Marks)

3. Calculate the current ratio and gearing ratio for 2021; critically comment on the ratios referring to the case study material. (10 Marks)

4. InterContinental Hotels Group PLC has a price/earnings (P/E) ratio of 27.71 in year 2022. Please comment on the valuation by comparing it with a competitor company with a P/E ratio of 19.56 (e.g. Whitbread PLC). Critically compare the P/E ratio for business valuation with enterprise multiples (30 marks)

(Total: 100 Marks)

*Round all numbers to one decimal place.

Appendix: Suggested ratio table