International Workplace Group (IWG) H2 2024 earnings summary

Executive summary

• Achieved record system-wide revenue of $4.2 billion, up 2% year-over-year, and highest-ever EBITDA of $557 million, up 11% from 2023, with 899 new centers signed and 624 opened, representing nearly 20% of the existing estate.

• Transitioned business model towards services, management, and franchising, reducing capital intensity and increasing recurring fee income.

• Returned to EPS profitability with basic EPS of 2.0c, first positive full-year earnings since the pandemic.

• Announced a $50 million share buyback and reinstated dividends for the first time since 2019.

• Net debt reduced from $861 million to $712 million since 2022, with a new BBB (Stable) credit rating.

Financial highlights

• System-wide revenue reached a record $4.2 billion, up 2% year-over-year; EBITDA grew 11% to $557 million.

• Gross profit increased 51% to $1.1 billion, with margin rising to 30% from 20%.

• Adjusted EBITDA (pre-IFRS 16) rose 11% to $557 million; operating profit up 185% to $510 million.

• Free cash flow from operations reached $205 million; free cash flow to equity about $100 million.

• Maintenance CapEx fell 16% since 2022; total CapEx declined 13% year-over-year.

Outlook and guidance

• Issued explicit 2025 EBITDA guidance of $580–$620 million; medium-term EBITDA target remains $1 billion.

• Cash flow generation in 2025 expected to exceed 2024; maintenance CapEx to remain flat at ~$100 million.

• Progressive dividend policy and further share buybacks anticipated.

• Transition to US GAAP reporting by half-year 2025.

• Final dividend of 0.90c per share recommended.