REG - Intnl Workplace Grp - H1 Results Announcement - Ending 30 June 2025
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RNS Number : 8019V International Workplace Group PLC 19 August 2025
19 August 2025
International Workplace Group PLC
H1 RESULTS ANNOUNCEMENT
International Workplace Group plc, the world's largest hybrid workspace
platform with a network in over 120 countries through flexible workspace
brands such as Regus, Spaces, HQ, Signature, issues its results for the six
months ended 30 June 2025.
DELIVERING GROWTH AND OPERATIONAL CASHFLOWS SUPPORT INCREASED RETURNS TO
SHAREHOLDERS
Delivering the Group's growth, margin and cashflow strategy
• Highest-ever system-wide revenue of $2.2bn, 2% year-on-year growth vs
$2.1bn at H1 2024
◦ 2.6x growth in recurring management fee revenue year-on-year
◦ 116bps increase in underlying Company-owned adjusted gross margin
◦ 6% underlying revenue growth in Digital & Professional Services
and well established for delivery in 2026
◦ Core overheads flat, demonstrating operational leverage as we continue
to invest in growth
• 6% Group Adjusted EBITDA growth to $262m (H1 2024: $247m)
• Strong balance sheet with no refinancing needs until 2029 and leverage
remaining at 1.5x net debt / EBITDA
• $59m of capital returned to shareholders since March comprising
dividends and buybacks, 3.5x more capital returned in 4 months vs the
aggregate of the last 5 years
• Cashflow for FY 2025 expected to be up 40% to at least $140m
◦ Increase in the buyback programme for FY25 announced today to at least
$130m
◦ Continuing our progressive dividend policy with an interim dividend of
0.45c per share
Summary financials and segment overview
$m H1 2025 H1 2024
System-wide revenue 2,162 2,123
Group revenue 1,850 1,871
Adjusted EBITDA(1) 262 247
Operating profit 68 68
Earnings per share (¢) 1.1 0.9
Cashflow before corporate activities 48 36
Net debt 754 729(2)
1. EBITDA excluding adjusting items and depreciation of
landlord contributions on leases
2. 31 December 2024
Segmental Summary
$m System Revenue Segment Revenue Adjusted gross profit Maintenance Capex (net) Growth
Capex (net)
Managed & Franchised 361 50 50 n/a n/a
Company-owned 1,593 1,593 375 35 9
Digital & Professional Services 207 207 98 - 11
Total in H1 2025 2,162 1,850 523 35 20
Total in H1 2024 2,123 1,871 503 32 29
Managed & Franchised: increased system-wide revenue and fee income, driven by significant growth across our open network and signings pipeline
• 26% system-revenue growth year-over-year to $361m (H1 2024: $287m)
• 43% growth in total fee income to $50m (H1: 2024 $35m)
◦ 163% growth of recurring management fees to $19m (H1 2024: $7m)
• RevPAR in Managed Partnerships evolving as expected across cohorts
• Continued investment in the partnership sales team headcount of $15m
has accelerated the development of our pipeline with 413 new locations signed
in H1 2025 (H1 2024: 387)
• We continue to convert our pipeline into openings at pace with a
further 37,400 gross rooms added to the network in H1 2025
• At the end of H1 2025, 220k rooms were open with a further 186k(1)
rooms that were signed not yet open. Once these rooms are all open and mature,
they are expected to produce system-wide revenue of $1.4bn per year
$m H1 2025 H1 2024 Growth
System revenue 361 287 26%
RevPAR ($) 317 384 (17)%
RevPAR - Managed 178 217 (18)%
RevPAR - Managed - excluding 2024 openings 285 n/a n/a
RevPAR - Franchised & JVs 502 488 3%
Rooms open 220,000 154,000 43%
Centres open 1,365 901 51%
Rooms opened in the period 37,400 37,000 1%
Centres opened in the period 262 247 6%
Rooms in pipeline(3) 186,000 151,000 23%
New centre deals signed 413 387 7%
Fee income 50 35 43%
Adjusted gross profit 50 35 43%
3. Signed rooms that have not been opened after 2 years have now been
removed from the pipeline - this equated to 19,000 rooms removed at the end of
H1 2025
Company-owned: continued margin expansion with focus on occupancy to translate into future revenue growth
• 1% growth in open-centre revenue
• Adjusted gross margin expansion of 210bps to 24% (H1 2024: 21%).
Margins expanded due to open centre revenue growth combined with a reduction
in centre costs, of which, 116bps of this expansion is recurring
• RevPAR for H1 2025 of $346 reduced 3% (H1 2024: $358) but higher
occupancy driving more revenue capture opportunity through higher services
revenue
• 240bps increase in occupancy over the past 12 months
• We continue to selectively add locations to our Company-owned
network
◦ Further reduction in both centre-related net growth capex to $7m (H1
2024: $22m) and controlled net maintenance capex of $35m (H1 2024: $32m)
$m H1 2025 H1 2024 Change
Revenue 1,593 1,613 (1)%
Open Centre Revenue 1,576 1,560 1%
RevPAR ($) 346 358 (3)%
Rooms open 777,400 771,000 1%
Centres open 2,895 2,850 2%
Centres opened in the period 76 59 29%
Adjusted gross profit 375 346 8%
Adjusted gross profit margin 24% 21% 210bps
Digital & Professional Services: division positioned to deliver
• Underlying revenue growth of 6% year-over-year
• New management structure creating better alignment with wider
enterprise strategy to better serve customer needs
• No changes to expectations
$m H1 2025 H1 2024 Change
Revenue 207 223 (7)%
Underlying revenue 207 197 6%
Adjusted gross profit 98 122 (20)%
Underlying adjusted gross profit 98 108 (10)%
Mark Dixon, Chief Executive of International Workplace Group plc, said:
"We set out a clear strategy at our Investor Day in December 2023 for capital
light growth to deliver cashflow, and business simplification. We have been
delivering against this strategy and will continue to do so.
In the last six months, more locations were opened than in the entire first
decade of our existence. We now have around 1 million rooms in 121 countries
with a significant pipeline. This is expected to drive our future growth."
Outlook and guidance
We reiterate our guidance as outlined with the release of our US GAAP
financials on 30 June 2025. For the full 2025 financial year we expect:
· Centre growth and signings to accelerate
· Adjusted EBITDA of $525m-$565m, but likely to be towards the
lower end of the range due to further investment in Managed and Franchise
segment growth
· Net debt to be roughly unchanged at the end of 2025 vs 31
December 2024
· Reiterate commitment to maintaining a BBB credit rating and
de-levering towards 1.0x net debt / Adjusted EBITDA
· Share buyback of at least $130m;
· Cashflow to shareholders of at least $140m, at least a 40%
increase to the guidance given in March; and
· On track to deliver medium-term at least $1bn EBITDA target.
Financial calendar
19 September 2025 Interim dividend record date
17 October 2025 Interim dividend payment date
4 November 2025 Q3 2025 trading update
4 December 2025 Investor Day in New York City
3 March 2026 2025 Full Year results
5 May 2026 Q1 2026 trading update
11 August 2026 2026 First Half results
Results presentation
Mark Dixon, Chief Executive Officer, and Charlie Steel, Chief Financial
Officer, will be hosting a virtual presentation of the results today for
analysts and investors at 9.00am UK time
The presentation will be available via live webcast and will be available to
view at the following link IWG Analyst Presentation
(https://brunswickgroup.zoom.us/webinar/register/WN_wVE57UZjROutWpJ2gvShMw#/registration)
Further information
International Workplace Group plc Brunswick Tel: + 44 (0) 20 7404 5959
Mark Dixon, Chief Executive Officer Nick Cosgrove
Charlie Steel, Chief Financial Officer Peter Hesse
Richard Manning, Head of Investor Relations
Chief Executive Officer's Review
In the first half of 2025, a very significant milestone was achieved with more
new locations signed and opened than in the entire first decade of our
operations. Our network now comprises more than one million rooms in 121
countries and our substantial pipeline will drive accelerated growth in the
months and years ahead.
Our strategy
We set out a clear strategy at our Investor Day in December 2023 to grow, in a
capital-light manner, with the aim of significant cashflow growth, all whilst
making the business easier to understand. I am delighted that we have been
delivering successfully against this strategy and will continue to do so.
We are continuing to make ongoing investments into our world class platform as
well as our marketing operations to deliver on the rapid growth of network
coverage in partnership with the property industry and investors using
capital-light expansion methods such as management agreements, partnering
deals and franchising.
The shift towards hybrid and more localised working is propelling our business
forward with the fastest growth that we have ever seen in history. In the
first half of 2025, we added a record number of locations globally, signing
496 centres, with all except two under the partnership model - and achieved
our highest ever revenues.
We are executing our capital-light growth strategy benefiting from the growing
pipeline of property investors seeking to maximise their returns by partnering
with IWG.
Focusing on growth through the capital-light business continues to drive
growth capex requirements lower, generating more free cash flow for
shareholders.
We are increasingly seeing partners sign multiple locations with IWG as they
grasp the scale of the opportunity in front of them. My greatest thanks go to
all our valued property owners and investors who have chosen to partner with
us and as a business we are resolutely committed to the long-term success of
these partnerships.
The market in which we operate
Our growth is being fuelled by the widespread uptake of platform and hybrid
working, which has revolutionised how and where people work, bringing
significant productivity benefits and lower costs to companies while
transforming the working lives of their teams.
Over the past few years, these more flexible ways of working have become the
default model for a significant proportion of white-collar workers; with
companies empowering their employees to work across multiple locations,
splitting their time between local workspaces, a central office and home.
This is not simply a change in how people work, rather a rebalancing of where
economic value is created. The days of needing to be tethered to a central HQ
are behind us. Technology has changed everything, effectively removing the
need for daily long and expensive commutes.
This long-term shift towards the hybrid model is one of the mega-trends of our
time and represents a substantial financial opportunity for IWG. With 1.2
billion white-collar workers globally, our industry has a total addressable
audience valued at more than $2 trillion and platform working is set to become
the norm for many of these employees.
It is particularly rewarding to see over the past few years how academics,
leading industry commentators and business leaders are now recognising the
incredible benefits of this way of working for both companies and their
people.
The research of Professor Nicholas Bloom - a senior fellow at the Stanford
Institute for Economic Policy Research and acknowledged as the world's leading
authority on the hybrid model - has shown that about 40% of white-collar
employees now work in this model and will continue to do so in the future.
We had the opportunity to partner with Arup earlier this year to further
explore the productivity gains that can be expected from more localised
working for businesses of all sizes, as well as the economic advantages for
companies and local communities, building on the groundbreaking work of
Professor Bloom. This new research confirms what we've long seen coming:
working from local offices and workspaces closer to where people live, doesn't
just improve the quality of life for employees, it also delivers major
productivity benefits for businesses, cities, and entire economies.
The results of this new study are powerful. By 2030, more flexible and
localised ways of working could boost productivity by 11% in the US and 12% in
the UK, contributing a staggering $219 billion and £24 billion to their
respective economies each year. By 2045, that impact could rise to $566
billion and £46 billion annually - the equivalent of adding cities the size
of Austin, Texas to the US economy or Leeds to the UK economy.
The Rise of Local Working
Today, the remarkable advances in cloud technology and video conferencing
software - both vital to enabling effective hybrid working - mean workers no
longer need to travel long distances on a daily basis. As a result, we are
seeing a fundamental shift in the geography of work with the centre of gravity
moving towards local communities. Tech changes will continue to advance in
years to come and will radically underline and advance the flexibility of
location.
The rising demand for more localised working has led to the majority of our
new International Workplace Group centres opening in the heart of local
communities, suburbs and rural areas, enabling many people around the world to
say farewell to long daily commutes.
In particular, small towns have seen a dramatic increase in new locations with
recent signings in the U.S including Franklin, TX, Berwyn, PA, and Bloomfield
Hills, MI, all with populations below 5,000.
That is not to say that businesses are abandoning city centres: far from it.
Increasingly, we are helping companies shake off the expense of the long-term
city-centre lease and replace it with a flexible, cost-effective agreement on
a smaller space in one of our city-based centres.
Our H1 Financial Performance
With such strong momentum globally behind the shift to platform and hybrid
working, confirmed by our financial results for the first half, our record
system revenue, EBITDA, and network growth leading to an extended share
buyback.
Our financial performance reinforces that we are successfully executing our
strategic goals and leave us well-positioned as move into H2 and beyond into
2026.
Our Managed and Franchise division achieved a 2.6x year-on-year growth in
recurring management fee revenue driven by rapid expansion across our open
network and signings pipeline. Meanwhile, the Company-owned portfolio
delivered a 2% increase in adjusted gross margin and Digital &
Professional Services grew by 6%. Core overheads remained flat, demonstrating
significant operational leverage even as we continue to invest in growth.
I would like to take this opportunity to thank our incredible team members,
whose dedication has driven the rapid expansion of our global network and
delivered this strong set of results. I would also like to acknowledge the
hard work of our Finance team reflected in the successful conversion of our
reporting framework to US GAAP and ongoing finance efficiency initiatives.
Looking ahead
The future for IWG and all our stakeholders remains bright. We continue to
grow our customer base, which is up 6% year-on-year, as well as our global
network and our best-in-class portfolio of locations and brands, while
delivering on our capital light expansion strategy.
The first half of this year set a record for both revenue and network
expansion and provides the foundations for continued growth in the second half
of the year and beyond. With the aforementioned 1.2 billion white-collar
workers globally and a potential audience valued at more than $2 trillion,
there is substantial room for growth and as a company, we are absolutely
committed to capturing more of this market over the coming months and years
ahead.
Mark Dixon
Founder and CEO
19 August 2025
Chief Financial Officer's Review
The first half of 2025 has been another strong period for the Group. Network
growth of 338 new centre openings and good performance across all three
segments has delivered a record six months of system-wide revenue of $2.2bn,
Adjusted EBITDA of $262m, and underlying cashflow before shareholder returns
of $48m. We delivered capital returns to investors of $59m ($50m though share
buybacks and $9m dividends) in just over 3 months, 3.5x more than in aggregate
over the last half-decade. Simultaneously net debt remained stable and net
capex spend reduced. We have continued to deliver positive earnings for a
second consecutive year.
The Finance department has:
• Converted our reporting framework to US GAAP
• Undertaken a Group-wide ERP implementation and continued to invest
in AI and automation
• Strengthened our balance sheet further with no refinancing needs
until 2029 through the issuance of a €300m Investment Grade bond in May,
fully hedged into USD reducing FX volatility
The result of this is that we have a solid foundation from which we can
continue to capitalise on our scale as the business grows, while delivering
further on our existing capital allocation policy with the dividend and
continued share buyback programme.
Financial performance
The Group reports results in accordance with US GAAP.
Group income statement
$m H1 2025 H1 2024
System-wide revenue 2,162 2,123
Revenue 1,850 1,871
Cost of Sales (1,369) (1,400)
Gross profit 481 471
Gross profit margin 26% 25%
SG&A (250) (248)
Allowance for (recovery of) credit losses (11) (8)
Depreciation & Amortisation (140) (139)
Depreciation & Amortisation before landlord contributions (182) (171)
Depreciation of landlord contributions on leases 42 32
Impairments, disposals and closures (12) (8)
Operating Income 68 68
Interest Expense (40) (25)
Other finance costs (16) (11)
Profit before tax 12 32
Taxation and equity method investments (4) (23)
Profit for the period 8 9
Net loss attributable to non-controlling interests 3 -
Net income attributable to the Company 11 9
Basic EPS (¢)
From continuing operations 1.1 0.9
Attributable to shareholders 1.1 0.9
Adjusted EPS (¢)
From continuing operations 1.1 0.9
Attributable to shareholders 1.1 0.9
Segmental reporting
The Company is organised into three operating segments based on the types of
services provided, namely; the IWG Network (Company-owned and Managed &
Franchised) and Digital & Professional Services.
Revenue
Group system-wide revenue increased by 2% to $2,162m. Group revenue decreased
by 1% to $1,850m as a result of closures and the impact of the loss of the
legacy contract in DPS.
Our Managed & Franchised business delivered 26% system-revenue growth
year-over-year to $361m (H1 2024: $287m) and $305m of segment revenue. Fee
income increased by 43% to $50m (H1 2024: $35m), of which recurring management
fees grew 2.6x to $19m (H1 2024: $7m). The growth in this segment is driven by
the unprecedented number of centre openings, 338 in the last six months, where
signings continue to convert into openings at pace.
Company-owned remained stable, delivering segment revenue of $1,593m, with
open centres contributing growth of c.1%.
Digital & Professional Services reported revenue regression of 7% to
$207m, however delivered underlying revenue growth of 6% when excluding the
impacts of the loss of the legacy contract.
System Revenue Segment Revenue
$m H1 2025 H1 2024 % change H1 2025 H1 2024 % change
Managed & Franchised 361 287 26% 50 35 43%
Company-owned 1,593 1,613 (1)% 1,593 1,613 (1)%
DPS 207 223 (7)% 207 223 (7)%
Group 2,162 2,123 2% 1,850 1,871 (1)%
Revenue per Available Room (RevPAR)
RevPAR is a monthly average KPI, defined as the system-wide revenue of the IWG
Network (excluding Digital & Professional Services and excluding centres
opened and closed during the year), divided by the number of available rooms,
which is defined as 7 square metres across all usable space. RevPAR is a well
understood measure used across many industries and is particularly relevant to
IWG as it incorporates all revenue received across IWG's expansive product
portfolio.
Given the scale of growth and room additions that the Company is adding to the
Network, RevPAR excluding centres opened in 2024 is presented below to show
RevPAR progression excluding the impact of centres not yet mature. It is
expected that the higher-growth segments will show a falling year-over-year
RevPAR because new locations that have opened but are not yet mature are
contained within the calculation.
Managed RevPAR is $178 (H1 2024: $217) and excluding 2024 openings is $285,
being driven by new centre revenue performing in line with our plans. RevPAR
in our franchised locations was $502 (H1 2024: $488) which is higher than in
our Managed Partnerships locations due to: (a) franchise locations being
predominantly in high RevPAR countries, in particular Japan and Switzerland;
(b) the higher maturity of franchise locations which have been operating for
many years. As we have previously disclosed, RevPAR on these additional
Managed Partnerships rooms is targeted to be $250 at maturity.
RevPAR in Company-owned for H1 2025 was $346, down by 3% (H1 2024: $358). This
is due to price reductions to drive long-term occupancy, the latter of which
is up 240bps over last 12 months. Higher occupancy also drives more revenue
capture opportunity through ancillary services.
System RevPAR ($, monthly average) H1 2025 H1 2025 ex 2024 openings H1 2024 % change
Managed & Franchised 317 435 384 (17)%
Managed 178 285 217 (18)%
Franchised and JVs 502 519 488 3%
Company-owned 346 357 358 (3)%
DPS n/a n/a n/a n/a
IWG Network 341 367 362 (6)%
Adjusting items
The Group identified net adjusting items on gross profit of $42m (H1 2024:
$32m) and operating profit of $54m (H1 2024: $40m). These adjusting items
refer to depreciation of landlord contributions of $42m (H1 2024: $32m),
impairment of long-lived assets and goodwill of $17m (H1 2024: $34m), (gain)
loss on disposal of long-lived assets and other closure related (credits)
costs of $(5)m (H1 2024: $(26)m).
Adjusting items impact ($m) H1 2025 H1 2024
Depreciation of landlord contributions on leases 42 32
Adjusting items impact on Gross Profit 42 32
Impairment of long-lived assets and goodwill 17 34
(Gain) loss on disposal of long-lived assets and other closure related (5) (26)
(credits) costs
Adjusting items impact on Operating Profit 54 40
Adjusting items impact on EBITDA 54 40
Adjusted gross profit
Gross profit increased from $471m in H1 2024 to $481m in H1 2025 and adjusted
gross profit increased from $503m in H1 2024 to $523m in H1 2025.
Adjusted gross margin expansion of 210ps to 24% on Company-owned (H1 2024:
21%). Margins expanded due to open centre revenue growth combined with a
reduction in centre costs, of which, 116bps of this expansion is recurring.
Given the operating model, 100% of Managed & Franchised revenue drops
through to gross profit, therefore reporting adjusted gross profit of $50m (H1
2024: $35m).
Digital & Professional Services adjusted gross profit reduced to $98m. The
reduction is due to both the loss of the legacy contract and an increase in
cost of sales due to the recognition of a non-recurring, non-cash lease
expense.
Adjusted gross profit ($m) H1 2025 Adjusting items(1) H1 2025 H1 2024 Adjusting items(1) H1 2024
- Adjusted
- Adjusted
Managed & Franchised 50 50 35 35
Company-owned 345 30 375 314 32 346
DPS 86 12 98 122 122
Adjusted gross profit 481 42 523 471 32 503
1. Adjusting items refer to the impact of the depreciation of
landlord contributions on leases included in Depreciation and Amortisation
SG&A
Group SG&A remained flat in H1 2025 at $250m (H1 2024: $248m). We continue
to manage costs effectively, realising the benefits of the multiple completed
and ongoing finance transformation projects, and had the benefit of
non-recurring cost items which offset the investment in efficiencies and
growth, specifically:
• Additional investment in the Partnership sales team of $4m in this
half alone to ensure we maintain our market leading position. We signed 496
new deals in H1 2025 vs 465 in 2024, and whilst our partnership sales team is
an ongoing cost, we are not expecting it to increase linearly with signings,
therefore margins should continue to grow.
• Additional marketing to support the brand and centre growth.
• Project costs recognised on one-off investments into the scalability
of our sales and operating platform as we continue to optimise and automate
processes.
• Operating cost within the Finance transformation programme, such as
consultancy and additional audit costs relating to the transition to US GAAP
reporting
Operating Profit
Operating Profit was flat at $68m, with the increase in gross profit being
offset by increases in allowance for (recovery of) credit losses and
impairments, disposals and closures of $(3)m and $(4)m respectively
year-over-year.
Net finance expense
The Group reported a net finance expense for the first half of the year of
$56m (H1 2024: $36m). The increase of which is predominantly due to higher
interest rates following refinancing transactions completed in 2024.
The net finance expense in 2025 mainly includes cash interest of $44m related
to borrowing facilities (H1 2024: $37m). All the Group's Eurobonds are now
hedged into USD using cross-currency interest rate swaps. Under the swap
agreements, interest is paid semi-annually. Other finance costs include
commitment fees on facilities such as the $720m revolving credit facility.
Finance expense $m H1 2025 H1 2024
Interest expense (40) (25)
Foreign currency loss (5) (7)
Gain on extinguishment of debt 1 10
Other finance costs (12) (14)
Net finance expense (56) (36)
1. Excluding financing fees on the issuance of the Euro bond
which are capitalised
Taxation
The estimated annual effective tax rate in 2025 is 50% (2024: 66%). The Group
has performed an assessment of its potential exposure to Pillar Two global
minimum income taxes and does not expect any material top-up taxes to arise in
any jurisdiction in which it operates. At half year the Group has performed a
high-level analysis of the Pillar II rules. The majority of the Group's
entities benefit from transitional safe harbour rules which take them out of
scope of the full rules, and the remaining countries are not expected to give
rise to any material top-up tax in 2025. This position is unchanged from year
end 2024 where a more detailed analysis was performed.
Given the Group's global footprint across over 120 countries, it is not
possible to take advantage of tax grouping on a global basis. As a result, the
aggregation of tax paid in individual countries can lead to a high effective
tax rate on group profits in certain periods. Although it is difficult to
predict the impact of developments in global taxation, as profitability of the
Group increases it is expected that the effective tax rate will fall and the
marginal effective tax rate on these profits is currently anticipated to be
c.20%.
Earnings per share
Earnings per share attributable to ordinary shareholders in H1 2025 was a
profit of 1.1c (H1 2024: profit of 0.9c).
The weighted average number of shares in issue during the period was
1,012,730, 251 (H1 2024: 1,007,598,732). At 30 June 2025 the Group held
20,468,890 treasury shares (31 December 2024: 45,241,020). During the six
months ended 30 June 2025 and 2024, share awards of 10,878,879 and 10,605,446,
respectively, had a dilutive effect with a negligible impact on the basic
earnings per share.
Adjusted EBITDA
The Group's Adjusted EBITDA increased to $262m (H1 2024: $247m).
EBITDA ($m) Bridge H1 2025 Adjusting items(1) H1 2025 H1 2024 Adjusting items(1) H1 2024
- Adjusted
- Adjusted
Managed & Franchised 50 50 35 35
Company-owned 345 30 375 314 32 346
DPS 86 12 98 122 - 122
Adjusted gross profit 481 42 523 471 32 503
SG&A (250) (250) (248) - (248)
Allowance for (recovery of) credit losses (11) (11) (8) - (8)
Depreciation & Amortisation (140) (140) (139) (139)
Impairments, disposals and closures (12) 12 - (8) 8 -
Operating profit/(loss) 68 54 122 68 40 108
Depreciation on property plant and equipment 112 112 112 112
Amortisation of intangible assets 28 28 27 - 27
Adjusted EBITDA 208 54 262 207 40 247
1 Adjusting items as per table above.
Network growth
Unprecedented network expansion, increasing our footprint by 14% to 4,260
centres (H1 2024: 3,751). We opened 338 new centres (H1 2024: 306 centres) and
rationalised (67) centres (H1 2024: (69) centres). Furthermore, 496 new centre
deals were signed in H1 2025. Out of the 496 new deals signed c.100% of the
deals are capital-light which underpins our success of growing the network
through capital-light partnerships.
Of the 338 centres opened in H1 2025, 327 centres were capital-light openings
which comprised of managed partnership centres, variable rent centres,
franchised centres and joint-venture centres. Only 11 centre openings were on
a fully conventional basis.
Our estate of 4,260 centres as per the end of June 2025 is split into 32% or
1,365 in Managed & Franchised, which increased by 51% year-on-year, and
2,895 centres in Company-owned (of which 905 are based on variable rents)..
Strong growth in Managed partnership openings is expected to continue in the
remainder of 2025.
Key KPIs H1 2025 H1 2024 YoY change YoY change %
Number of centres open 4,260 3,751 509 14%
Centre Openings 338 306 32 10%
Of which capital-light(1) 327 291 36 12%
In % 97% 95%
Total new centre deals signed 496 465 31 7%
Of which capital-light(1) 494 460 34 7%
In % 100% 99%
1. Includes locations signed/opened in Managed &
Franchised and Variable rent areas
System locations movement by type Dec-24 Centre openings Centre rationalisations Changed H1 2025
Conventional 2,004 11 (27) 2 1,990
Variable rent (capital light) 869 65 (25) (4) 905
Company-owned 2,873 76 (52) (2) 2,895
Managed and Franchised (capital light) 1,116 262 (15) 2 1,365
Total 3,989 338 (67) 0 4,260
System rooms movement by type ('000) Dec-24 Centre openings Centre rationalisations Changed H1 2025
Conventional 543 4 (6) (0) 540
Variable rent (capital light) 233 13 (5) (3) 237
Company-owned 775 17 (11) (4) 777
Managed and Franchised (capital light) 185 37 (3) 1 220
Total 961 54 (14) (3) 997
Cash flow
$m H1 2025 H1 2024
Adjusted EBITDA 262 247
Working capital (excl. depreciation of landlord contributions on leases) (30) (43)
Working capital related to the depreciation of landlord contributions on (66) (61)
leases
Maintenance capital expenditure (net) (35) (32)
Other items (5) 10
Cash inflow/(outflow) from business activities(1) 126 121
Tax paid (14) (16)
Finance costs paid on bank & other facilities (44) (37)
Cash inflow/(outflow) before growth capex and corporate activities 68 68
Gross growth capital expenditure (38) (54)
Growth-related landlord contributions 18 25
Net growth capital expenditure (20) (29)
Purchase of subsidiary undertakings (net of cash) - (3)
Cash inflow/(outflow) before corporate activities 48 36
Cash impact expected to be recovered in H2 (15) -
Proceeds from issue of loans, net of related transaction costs 15 819
Proceeds from issue of Eurobond, net of related transaction costs 337 613
Other finance transaction costs (5) (11)
Repayment of loans (5) (1,276)
Repayment of Convertible bond (22) (137)
Payment of ordinary dividend (9) (13)
Purchase of own shares (50) -
Other financing activities, net 3 (1)
Net cash inflow/(outflow) for the year 297 30
Opening net cash 148 141
FX movements 5 (11)
Closing cash 450 160
The total proceeds from landlord contributions relating to the reimbursement
of costs and lease incentives of $23m (2024: $26m) are allocated between
maintenance landlord contributions of $5m (2024: $1m) and growth landlord
contributions of $18m (2023: $25m)
1. Cash flow before growth capex, tax, finance cost on bank
& other facilities, financing activities and dividends
We continued to grow our business and revenues whilst managing our cost base,
delivering a 33% increase in cash inflow before corporate activities in H1
2025 of $48m (H1 2024: $36m). Working capital relating the depreciation of
partner contributions refers to historic cash contributions made by landlords
for growth capex in the Company-owned segment (shown as growth-related partner
contributions further down the cash flow statement) and is amortised over the
lifetime of the corresponding lease.
Other working capital movements are summarised in the table below:
Working capital movements ($m) H1 2025 H1 2024
Trade receivables, prepayments and deferred revenue 20 (40)
Customer deposit movements (excluding non-cash FX movements) 13 13
Trade payables and accruals (39) 8
Cash bonus payment (24) (24)
Total (30) (43)
Cash tax paid was $(14)m in H1 2025 (H1 2024: $(16)m) and primarily relates to
corporate income tax paid in various countries. Finance costs paid on bank
& other facilities was $(44)m in H1 2025 vs. $(37)m in H1 2024, the
increase of which is due to the refinancing transactions completed in 2024.
Cash inflow before growth capex, financing and dividends was $68m (H1 2024:
$68m).
Total net capex for H1 2025 was $55m (H1 2024: $61). Maintenance capex
remained in line with prior year at $35m (H1 2024: $32m) and is expected to be
below $100m for the full year. Growth capex declined from $29m to $20m, with
$9m spent on Company-owned centres. We are confident that overall capex will
remain at this level due to new locations in our Company-owned business
increasingly being signed up without capex needs for the Group; Managed &
Franchised faces zero capex, and the majority of platform investment for
Digital & Professional Services is complete.
Capital expenditure $m Managed & Franchised Company-owned Digital & Professional Services H1 2025 Managed & Franchised Company-owned Digital & Professional Services H1 2024
Growth capital expenditure - 16 12 28 - 47 1 48
Landlord contributions to Growth capital expenditure - (9) (9) (18) - (25) - (25)
Growth capital expenditure on Intangible Assets - 2 8 10 - 1 5 6
Net Growth capital expenditure - 9 11 20 - 23 6 29
Centre maintenance capital expenditure - 32 - 32 - 26 - 26
Landlord contributions to Maintenance capital expenditure - (5) - (5) - (1) - (1)
Other maintenance capital expenditure - 8 - 8 - 7 - 7
Net Maintenance capital expenditure - 35 - 35 - 32 - 32
On 30 April 2025, the Company completed the acquisition of the remaining
noncontrolling interests in the Digital and Professional Services reportable
segment in exchange for 23,095,239 common shares of International Workplace
Group plc.
Financing
During H1 2025 the Group successfully completed an additional debt
transaction, extending the Group's debt maturity, and repurchased a further
proportion of the Convertible Bond:
· €300 million Euro bonds at an issuance price of 99.369%, a
fixed coupon rate of 5.125% and a bullet maturity of May 14, 2032. The bonds
are traded on the London Stock Exchange's International Securities Market and
were fully hedged into USD, along with the previously unhedged portion of the
Group's €625m Euro bonds.
· 2027 0.5% Convertible Bond:
o During the six months ended 30 June 2025, the Company repurchased £18
million ($23 million) face value of the convertible bonds at a weighted
average price of £0.965, including accrued interest, representing a
consideration of £17 million ($22 million), resulting in a gain on settlement
of $1 million.
o During the six months ended 30 June 2024, the Company repurchased £118
million face value of the convertible bonds at a weighted average price of
0.9215, including accrued interest, representing a consideration of £109
million, resulting in a gain on settlement of $10 million.
o Due to the repurchases occurring during the six months ended 30 June 2025
and 2024, £18m and £118m, respectively, of the forward exchange rate
contracts entered into during January 2024, were closed out
Overall, net financial debt was $(754)m at 30 June 2025 (31 December 2024:
$(729)m). The Group's total debt facilities, including details of drawings, is
summarised below:
Net debt
Net Financial Debt $m H1 2025 31 Dec 2024
2027 0.5% Convertible Bond 178 199
Euro Bond 989 648
RCF Drawn 0 0
Revolving Credit Facility (RCF) 720 720
RCF available 420 436
RCF guarantee utilisation 300 284
Other debt 33 19
Cash and cash equivalents (446) (137)
Net financial debt 754 729
At 30 June 2025 the Group complied with all facility covenants.
Dividends
In line with the Group's dividend policy, the Board has agreed to pay an
interim dividend of 0.45¢ per share. The interim dividend is expected to be
paid on 17 October 2025 to shareholders on the register at the close of
business on 19 September 2025. Dividends are declared in US dollars and paid
in pounds sterling with an option for shareholders to elect to receive payment
in US dollars. The foreign exchange rate at which the final dividend will be
converted into pounds sterling will be the New York closing rate on 19
September 2025.
Share buyback
In the first half of 2025, IWG repurchased and cancelled 20,652,686 ordinary
shares which completed the first $50m tranche of its share buyback programme
of up to $100m. The Second Tranche started on 1 July 2025 which has been
carried out in accordance with the authorisation granted by the Annual General
Shareholders Meeting held on 20 May 2025. .
Foreign Exchange
Per USD$ H1 2025 H1 2024 % H1 2025 H1 2024 %
Sterling £ 0.73 0.79 8% 0.77 0.79 3%
Euro € 0.85 0.93 9% 0.91 0.93 2%
Risk management
Effective management of risk is an everyday activity for the Group, and
crucially, integral to our growth planning. A detailed assessment of the
principal risks and uncertainties which could impact the Group's long-term
performance and the risk management structure in place to identify, manage and
mitigate such risk will be included in the 2025 Annual Report and Accounts.
Related parties
There have been no changes to the type of related party transactions entered
into by the Group that had a material effect on the financial statements for
H1 2025. Details of related party transactions that have taken place in the
period can be found in note 13.
Going concern
The Group reported a profit after tax of $8m in H1 2025 (H1 2024: profit of
$9m). Cashflow before growth capex and corporate activities but after interest
and tax was $68m (H1 2024: $68m). Furthermore, net cash of $109m (H1 2024:
$126m) was generated from operations during the same period. Although the
Group's balance sheet at 30 June 2025 reports a net current liability position
of $2,087m (31 December 2024: $2,277m), the Directors concluded after a
comprehensive review that no liquidity risk exists as:
1. The Group had funding available under the Group's $720m revolving
credit facility of $420m (31 December 2024: $436m) which was available and
undrawn at 30 June 2025. The facility's current maturity date is June 2029;
2. A significant proportion of the net current liability position is
due to lease liabilities which are held in non-recourse special purpose
vehicles but also with a corresponding right-of-use asset. A large proportion
of the net current liabilities comprise non-cash liabilities such as deferred
revenue of $581m (31 December 2024: $539m) which will be recognised in future
periods through the income statement. The Group holds customer deposits of
$632m (31 December 2024: $584m) which are spread across a large number of
customers and no deposit held for an individual customer is material; and
3. The Group maintains a 12-month rolling forecast and a three-year
strategic outlook. It also monitors the covenants in its debt facilities to
manage the risk of potential breach. The Group expects to be able to refinance
external debt and/or renew committed facilities as they become due, which is
the assumption made in the viability scenario modelling, and to remain within
covenants throughout the forecast period. In reaching this conclusion, the
Directors have assessed:
· the potential cash generation of the Group against a range of
illustrative scenarios (including a severe but plausible outcome); and
· mitigating actions to reduce operating costs and optimise cash
flows during any ongoing global uncertainty.
4. An external assessment from Fitch, a leading global credit rating
agency, which has rated the Group and its listed bonds as investment grade
with a BBB (Stable) rating and has continued to monitor the Group's financial
performance since the initial rating assessment.
Due to the above, the Group does not believe the net current liabilities
represents a liquidity risk. The Directors consider that the Group is well
placed to successfully manage the actual and potential risks faced by the
organisation including risks related to inflationary pressures and
geopolitical tensions.
On the basis of their assessment, the Directors have a reasonable expectation
that the Group has adequate resources to continue in operational existence for
a period of at least 12 months from the date of approval of these Group
consolidated financial statements and consider it appropriate to continue to
adopt the going concern basis in preparing the financial statements of the
Group.
Charlie Steel
Chief Financial Officer
19 August 2025
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
Six months ended 30 June
$m, except per share amounts 2025 2024
Revenue 1,850 1,871
Cost of sales exclusive of items shown separately below 1,369 1,400
Gross profit 481 471
Selling, general and administrative expenses 250 248
Allowance for credit losses 11 8
Impairment of long-lived assets 17 34
Gain on disposal of long-lived assets and other closure related credits (5) (26)
Depreciation and amortisation 140 139
Depreciation and amortisation before landlord contributions 182 171
Depreciation of landlord contributions on leases (42) (32)
Operating income 68 68
Interest expense (40) (25)
Foreign currency loss (5) (7)
Gain on extinguishment of debt 1 10
Other finance costs (12) (14)
Income before income taxes and share of 12 32
Income (loss) from equity method investments
Income tax expense (6) (21)
Share of income (loss) from equity method investments 2 (2)
Net income 8 9
Net loss attributable to non-controlling interests 3 -
Net income attributable to the Company 11 9
Net income per common share:
Basic (¢) 1.1 0.9
Diluted (¢) 1.1 0.9
The accompanying notes are an integral part of these Condensed Consolidated
Financial Statements.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
Six months ended 30 June
$m 2025 2024
Net income 8 9
Other comprehensive income, net of tax:
Foreign currency translation adjustments 66 10
Cash flow hedges (34) (2)
Total other comprehensive income 32 8
Total comprehensive income 40 17
Net loss attributable to non-controlling interests (3) -
Foreign currency translation adjustments attributable to non-controlling 3 -
interests
Comprehensive income attributable to non-controlling interests - -
Comprehensive income attributable to the Company 40 17
The accompanying notes are an integral part of these Condensed Consolidated
Financial Statements.
CONDENSED CONSOLIDATED BALANCE SHEETS
As of
$m, except share and per share amounts 30 June 2025 31 December 2024
(UNAUDITED)
Assets
Current assets:
Cash and cash equivalents 446 137
Accounts receivable, net 692 651
Prepaid expenses 158 152
Other current assets 416 391
Total current assets 1,712 1,331
Non-current assets:
Operating lease right-of-use assets 5,496 5,161
Property and equipment, net 800 784
Intangible assets, net 180 176
Deferred tax assets 368 357
Goodwill, net 1,254 1,173
Equity method investments 58 54
Other non-current assets 129 76
Total non-current assets 8,285 7,781
Total assets 9,997 9,112
Liabilities
Current liabilities:
Accounts payable 219 232
Short-term debt, net 222 212
Deferred revenue 581 539
Customer deposits 632 584
Operating lease liabilities 1,279 1,154
Accrued expenses and other current liabilities 866 887
Total current liabilities 3,799 3,608
Non-current liabilities:
Long-term debt, net 1,061 633
Long-term operating lease liabilities 5,255 4,989
Other non-current liabilities 97 91
Total non-current liabilities 6,413 5,713
Total liabilities 10,212 9,321
Shareholders' deficit
Common stock; par value $0.0124; 8,000,000,000 shares authorised, 13 13
1,036,595,965 issued and outstanding as of 30 June 2025 and 1,057,248,651 as
of 31 December 2024, respectively
Treasury stock, at cost; 20,468,890 shares as of 30 June 2025 and 45,241,020 (94) (182)
shares as of 31 December 2024
Additional paid-in capital 416 493
Accumulated deficit (266) (268)
Accumulated other comprehensive loss (284) (313)
Total shareholders' deficit (215) (257)
Non-controlling interests - 48
Total shareholders' deficit (215) (209)
Total liabilities and shareholders' equity 9,997 9,112
The accompanying notes are an integral part of these Condensed Consolidated
Financial Statements.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(UNAUDITED)
Common Stock
$m, except share amounts Shares Amount Treasury Stock Additional Accumulated Deficit Accumulated other comprehensive loss Total Shareholders' equity (deficit) - the Company Non-controlling interests Total Shareholders' equity (deficit)
paid-in capital
Balance as of 1 January 2024 1,057,248,651 13 (194) 491 (269) (345) (304) 63 (241)
Net income - - - - 9 - 9 - 9
Other comprehensive income (loss), net of tax - - - - - 8 8 - 8
Stock-based compensation - - - 1 - - 1 - 1
Dividends declared and paid - - - - (13) - (13) - (13)
Purchase of non-controlling interests - - 12 - - - 12 (14) (2)
Balance as of 30 June 2024 1,057,248,651 13 (182) 492 (273) (337) (287) 49 (238)
Balance as of 1 January 2025 1,057,248,651 13 (182) 493 (268) (313) (257) 48 (209)
Net income - - - - 11 - 11 (3) 8
Other comprehensive income (loss), net of tax - - - - - 29 29 3 32
Retirement of derivative liability on NCI repurchase - - 9 (3) - - 6 - 6
Stock-based compensation - - - 3 - - 3 - 3
Share buyback and cancellation (20,652,686) - - (50) - - (50) - (50)
Issuance of shares under stock compensation plans - 9 (5) - - 4 - 4
Dividends declared and paid - - - - (9) - (9) - (9)
Purchase of non-controlling interests - - 70 (22) - - 48 (48) -
Balance as of 30 June 2025 1,036,595,965 13 (94) 416 (266) (284) (215) - (215)
The accompanying notes are an integral part of these Condensed Consolidated
Financial Statements.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
Six months ended 30 June
$m 2025 2024
Cash Flows from Operating Activities:
Net income 8 9
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortisation 140 139
Operating lease cost 716 699
Stock-based compensation 4 1
Deferred income tax benefit (3) (4)
Allowance for credit losses 11 8
Share of (income) loss from equity method investments (2) 2
Impairment of goodwill and other assets 17 34
Gain on disposal of assets (16) (14)
Gain on extinguishment of debt (1) (10)
(Decrease) in provision (21) (4)
Changes in operating assets and liabilities:
Accounts receivable and prepaid expenses (11) (41)
Other current assets and non-current assets 22 (7)
Accounts payable, accrued expenses, and other liabilities (94) 20
Deferred revenue 9 (8)
Customer deposits 13 13
Operating lease liabilities (712) (726)
Proceeds from landlord contributions(1) 23 26
Other operating activities, net 6 (11)
Net cash provided by operating activities 109 126
Cash Flows from Investing Activities:
Purchases of property and equipment (60) (74)
Additions to intangible assets (18) (13)
Acquisition of companies, net of cash acquired - (3)
Other investing activities, net 2 -
Net cash used for investing activities (76) (90)
Cash Flows from Financing Activities:
Proceeds from issuance of long-term debt 15 819
Proceeds from issue of Euro bonds 337 613
Payment of debt issuance cost (5) (11)
Repayment of long-term debt (5) (1,276)
Repayment of convertible bonds (22) (137)
Dividends paid (9) (13)
Purchase of treasury shares (50) -
Other financing activities, net 3 (1)
Net cash provided by (used for) financing activities 264 (6)
Effects of exchange rate changes on cash, cash equivalents and restricted cash 5 (11)
Changes in cash, cash equivalents and restricted cash 297 30
Net increase in cash, cash equivalents and restricted cash 302 19
Cash, cash equivalents and restricted cash at beginning of period(2) 148 141
Cash, cash equivalents and restricted cash at end of period(2) 450 160
1 During the six months ended 30 June 2025 and 2024, the total proceeds from
landlord contributions were $23 million and $26 million, respectively. These
amounts include reimbursements for costs of $18 million and $4 million, as
well as lease incentives of $5 million and $22 million.
2 Restricted cash is presented within Other current assets and Other
non-current assets. Refer to Note 1, Description of the Business and Summary
of Significant Accounting Policies, for further details.
Six months ended 30 June
$m 2025 2024
Cash paid during the period for interest (net of amount capitalised) 44 37
Cash paid during the period for income taxes, net 14 16
Utilisation of treasury shares for acquisition of non-controlling interest 70 12
The accompanying notes are an integral part of these Condensed Consolidated
Financial Statements.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
Note 1. Description of the Business and Summary of Significant Accounting
Policies
Business
International Workplace Group plc, and its subsidiaries (collectively "the
Company"), is the world's largest hybrid workspace platform with a network in
over 120 countries through flexible workspace brands such as Regus, Spaces, HQ
and Signature. International Workplace Group plc owns, manages and is a
franchise operator of a network of business centres which are utilised by a
variety of business customers. The Company manages its operations through
three reportable segments: Company-owned, Managed and Franchised, and Digital
and Professional Services.
The Company is a public limited company incorporated in Jersey under the
Companies (Jersey) Law 1991 and registered, domiciled, and headquartered in
Switzerland. The Company's common stock is traded on the London Stock
exchange. It was originally founded as "Regus" in 1989.
All references to "we", "us", "our", "IWG" and the "the Company" are
references to International Workplace Group plc and its subsidiaries on a
consolidated basis.
Basis of Presentation
Since the 30 June 2024 interim report was issued, the basis of preparation
changed from IFRS to US GAAP. The accompanying Condensed Consolidated
Financial Statements have been prepared in accordance with accounting
principles generally accepted in the United States of America ("US GAAP") for
interim financial information and include the accounts of the Company and its
consolidated subsidiaries. All values are in US dollars and rounded to
millions, except where indicated otherwise. Certain information and footnote
disclosures normally included in annual financial statements prepared in
accordance with US GAAP have been condensed or omitted. The accompanying
Condensed Consolidated Financial Statements do not constitute statutory
accounts as defined in Companies (Jersey) Law 1991.
As such, the information included in the accompanying Condensed Consolidated
Financial Statements should be read in conjunction with the audited US GAAP
Consolidated Financial Statements ("audited consolidated financial
statements") and the related notes thereto as of and for the year ended 31
December 2024 which are available from the Company's website - www.iwgplc.com.
These Condensed Consolidated Financial Statements were prepared following the
same accounting policies as the Consolidated Financial Sstatements. There was
no material effect from the adoption of new accounting policies and new US
GAAP standards effective as of 1 January 2025.
In the opinion of management, the accompanying Condensed Consolidated
Financial Statements reflect all adjustments, consisting of normal recurring
adjustments, which are necessary for the fair statement of the Condensed
Consolidated Balance Sheets, Statements of Operations, Statements of
Comprehensive Income and Statements of Cash Flows for these interim periods.
The results for the interim periods are not necessarily indicative of results
for the full fiscal year.
The Directors are responsible for preparing the Company's Condensed
Consolidated Financial Statements using applicable GAAP, as prescribed in the
Companies (Jersey) Law 1991.
Principles of Consolidation
Our Condensed Consolidated Financial Statements include the accounts of our
wholly owned subsidiaries and other non-wholly owned entities in which we have
a controlling financial interest, including Variable Interest Entities ("VIE")
for which we are the primary beneficiary. All material intercompany
transactions and balances have been eliminated in consolidation.
When making references in these Condensed Consolidated Financial Statements to
Net income attributable to the Company and Total shareholders' deficit - the
Company does not include non-controlling interests, which represent the
third-party ownership interests of our consolidated non-wholly owned entities
and are reported separately in the Condensed Consolidated Balance Sheets,
Condensed Consolidated Statement of Operations, and Condensed Consolidated
Statement of Comprehensive Income. On 8 March 2022, the Company completed the
acquisition of 100% equity interest in The Instant Group. The Instant Group
was merged with some of the Company's digital assets to create the Digital and
Professional Services reportable segment. In a separate transaction, the
Company sold a 13.4% noncontrolling equity interest in a subsidiary of the
Digital and Professional Services reportable segment (which included equity
interest in The Instant Group) for a consideration of $69 million.
During the six months ended 30 June 2024, the Company increased its equity
voting rights in the Digital and Professional Services reportable segment
subsidiary to 89.3% (from 86.6% as of 31 December 2023) for $14 million.
During the six months ended 30 June 2025, specifically on 30 April 2025, the
Company completed the acquisition of the remaining noncontrolling interests in
the Digital and Professional Services reportable segment in exchange for
23,095,239 common shares of International Workplace Group plc. From May 2025
onward, the Company no longer has non-controlling interests.
In 2020, Redox Plc was deconsolidated from the Company due to a loss of
control following bankruptcy proceedings. As a result of emergence on 25 April
2025, the Company reassessed its involvement with the subsidiary in accordance
with ASC 810, Consolidation, and determined it had regained control of the
entity. The criterion for applying fresh start accounting for Redox Plc is not
met as the Company held 100% of the voting shares before commencement of the
proceedings and upon emergence from bankruptcy. As part of regaining control,
the Company received $20 million of Cash and recognized $6 million of Accrued
expenses and other current liabilities, which were recorded on the Condensed
Consolidated Balance Sheets, with the corresponding Condensed Consolidations
Statements of Operations impact included in Selling, general and
administrative. The subsidiary's results of operations are included in the
Company's Condensed Consolidated Financial Statements from 25 April 2025.
Reorganisation
Upon completion of the acquisition of the remaining non-controlling interests
in the Digital and Professional Services reportable segment, the Company
reorganised its reporting structure ("Reorganisation"), changing the
composition of the Digital and Professional Services reportable segment. To
reflect the Reorganisation, assets and liabilities (including goodwill) were
reassigned between reportable segments. Please reference Note 3, Segments, and
Note 6, Goodwill, net, for further information.
Use of Estimates
The preparation of the Condensed Consolidated Financial Statements, in
accordance with US GAAP, requires management to make estimates and assumptions
that affect the amounts reported and, accordingly, actual results could differ
from those estimates. The Company bases its estimates on the information
available at the time, its experiences and various other assumptions believed
to be reasonable for the estimates underlying the Company's Condensed
Consolidated Financial Statements relate to, among other things, cash flows
used in the assessment of impairment of goodwill, intangibles, property and
equipment, right-of-use assets, reserves for uncertain tax positions,
valuation of derivatives, valuation allowances on deferred tax assets,
incremental borrowing rates on leases and the fair value of property and
equipment, intangibles and leasehold assets and liabilities acquired in
business combinations. Adjustments may be made in subsequent periods to
reflect more current estimates and assumptions about matters that are
inherently uncertain.
Restricted Cash
The Company is required to maintain cash deposits with certain banks which
consist of deposits restricted under contractual agreements or legal disputes.
The following represents a reconciliation of cash and cash equivalents and
restricted cash in the Condensed Consolidated Balance Sheets to cash, cash
equivalents and restricted cash in the Condensed Consolidated Statements of
Cash Flows:
As of
$m 30 June 2025 31 December 2024
Cash and cash equivalents 446 137
Restricted cash(1) 4 11
Cash, cash equivalents and restricted cash 450 148
1 As of 30 June 2025 and 31 December 2024, the following amounts of restricted
cash were included in other current assets: $3 million and $8 million.
Otherwise, all other restricted cash was included within other non-current
assets.
Impairment of Long-Lived Assets and Finite-Lived Intangible Assets
Long-lived assets, including right-of-use assets, property and equipment and
other finite-lived intangible assets are evaluated for recoverability when
events or changes in circumstances indicate that the asset may have been
impaired. In evaluating an asset for recoverability, the Company considers the
future cash flows expected to result from the continued use of the asset and
the eventual disposition of the asset. If the sum of the expected future cash
flows, on an undiscounted basis, is less than the carrying amount of the
asset, an impairment loss equal to the excess of the carrying amount over the
fair value of the asset is recognised.
We evaluate potential impairment at the reporting unit level. We allocate the
impairment loss related to an asset group among the various assets within the
asset group pro rata based on the relative carrying values of the respective
assets. Impairment of long-lived and finite-lived intangible assets, including
right-of-use assets, is included in Impairment of long-lived assets on the
Condensed Consolidated Statements of Operations.
Impairment of property and equipment was $4 million and $14 million for the
six months ended 30 June 2025 and 2024, respectively. The recorded impairment
related to the Company-owned segment and was due to underperforming business
centres.
Impairment of right-of-use assets was $13 million and $20 million for the six
months ended 30 June 2025 and 2024, respectively. The recorded impairment
related to the Company-owned segment and was due to underperforming business
centres.
Please reference Note 9, Fair Value Measurements, for more information
regarding the underlying impairment assessments.
Recent Accounting Pronouncements Not Yet Adopted
The recently issued but not yet effective Accounting Standard Update ("ASU")
applicable to the Company during the six months ended 30 June 2025 is
disclosed below. None of the Recent Accounting Pronouncements Not Yet Adopted
disclosed in Note 1, Description of the Business and Summary of Significant
Accounting Policies, of the audited consolidated US GAAP financial statements
as of and for the year ended 31 December 2024, were adopted during the six
months ended 30 June 2025.
Business Combinations and Consolidation
In May 2025, the Financial Accounting Standards Board issued ASU 2025-03
Business Combinations (Topic 805) and Consolidation (Topic 810): Determining
the Accounting Acquirer in the Acquisition of a Variable Interest Entity. The
amendments in the update require an entity involved in an acquisition
transaction primarily through the exchange of equity interests, where the
legal acquiree is a VIE that meets the definition of a business, to consider
specific factors outlined in paragraphs 805-10-55-12 through 55-15 to
determine which entity qualifies as the accounting acquirer. This ASU is
effective for fiscal years beginning after 15 December 2026, and interim
reporting periods within those annual reporting periods. The amendments are
applied prospectively. The Company is currently evaluating the effect of
adopting this new accounting guidance.
Note 2. Revenue from Contracts with Customers
The Company's primary activity is the provision of global workspace solutions.
Please reference Note 3, Segments, for revenue disaggregated by product
categories.
Receivables
The Company's receivables from contracts with customers are separately
presented as Accounts receivable, net on the Condensed Consolidated Balance
Sheets. As of 30 June 2025, and 31 December 2024, the allowance for current
expected credit losses was $12 million and $14 million, respectively.
Contract Liabilities
The Company's contract liabilities from contracts with customers are
separately presented as Deferred revenue on the Condensed Consolidated Balance
Sheets. The contract liabilities are classified as current due to the nature
of the Company's invoicing arrangements. All the contract liabilities as of 31
December 2024 were recognised during the six months ended 30 June 2025. The
change in contract liabilities period over period was due to the recognition
of revenue, which was partially offset by incremental deferred revenue.
The Company elected the practical expedient as per ASC 606-10-50-14 and
does not disclose information related to remaining performance obligations due
to their original expected terms being one year or less.
Note 3. Segments
The Company is organised into three operating segments based on the types of
services provided. The segment composition, as further described below,
reflects the Reorganisation described in Note 1, Description of the Business
and Summary of Significant Accounting Policies:
· Company-owned: Locations the Company operates directly and
recognises full revenue and costs of the centre.
· Managed & Franchised: Locations the Company receives a
franchise or management fee for providing services to centres. Managed centres
are operated by the Company; franchise locations are operated by the franchise
holder. The Company only recognises the fee as revenue. The Company is not
responsible for capital expenditures in the centres and does not recognise the
related centre operating costs.
· Company-owned and Managed & Franchised comprises the IWG
Network.
· Digital & Professional Services: Services and technology
provided to customers and landlords.
Company-owned and Managed & Franchised are aggregated into the Networks
reportable business segment. Digital and Professional Services meets the
criteria for separate disclosure as a reportable business segment. The Company
has determined its Chief Executive Officer ("CEO") is its Chief Operating
Decision Maker ("CODM"). The CEO reviews the Company's financial performance
based on these segments, specifically using Gross profit to assess performance
and make resource allocation decisions. Adjusted gross profit is also used by
the CODM in assessing segmental performance and determining how to allocate
resources because landlord contributions on leases are evaluated in totality
in commercial negotiations, rather than being dependent upon whether they are
accounted for as lease incentives. Adjusted gross profit (including landlord
contributions on leases) has been presented for the first time in the
Condensed Consolidated Financial Statements on 30 June 2025. The following
table reflects results of operations of the Company's reportable segments:
Networks
$m Company-owned Managed & Franchised Digital and Professional Services Total
30 June 2025
Revenue 1,593 50 207 1,850
Workstation revenue 1,168 - - 1,168
Fee income - 50 - 50
Other income 425 - 207 632
Cost of sales exclusive of the items shown below 1,248 - 121 1,369
Gross profit 345 50 86 481
Selling, general and administrative expenses 250
Allowance for credit losses 11
Impairment of long-lived assets 17
(Gain) on disposal of long-lived assets and other closure related (credits) (5)
Depreciation and amortisation 140
Depreciation and amortisation before landlord contributions 182
Depreciation of landlord contributions on leases (42)
Operating income 68
Interest expense (40)
Foreign currency loss (5)
Gain on extinguishment of debt 1
Other finance costs (12)
Income before income taxes and share of income from equity method investments 12
Gross profit 345 50 86 481
Landlord contributions on leases included in depreciation and amortisation 30 - 12 42
Adjusted gross profit 375 50 98 523
30 June 2024
Revenue 1,613 35 223 1,871
Workstation revenue 1,206 - - 1,206
Fee income - 35 - 35
Other income 407 - 223 630
Cost of sales exclusive of the items shown below 1,299 - 101 1,400
Gross profit 314 35 122 471
Selling, general and administrative expenses 248
Allowance for credit losses 8
Impairment of long-lived assets 34
Gain on disposal of long-lived assets and other closure related credits (26)
Depreciation and amortisation 139
Depreciation and amortisation before landlord contributions 171
Depreciation of landlord contributions on leases (32)
Operating income 68
Interest expense (25)
Foreign currency loss (7)
Gain on extinguishment of debt 10
Other finance costs (14)
Income before income taxes and share of loss from equity method investments 32
Gross profit 314 35 122 471
Landlord contributions on leases included in depreciation and amortisation 32 - - 32
Adjusted gross profit 346 35 122 503
Asset information
Total assets by Segment as of 30 June 2025 and 31 December 2024, were:
Networks
$m Company - owned Managed & Franchised Digital and Professional Services Total
30 June 2025 9,151 36 810 9,997
31 December 2024 8,420 34 658 9,112
Total capital expenditures by Segment for the six months ended 30 June 2025
and 2024 were:
Networks
$m Company - owned Managed & Franchised Digital and Professional Services Total
30 June 2025 58 20 78
30 June 2024 81 - 6 87
Note 4. Income Taxes
The Company recorded income tax expense, based upon the estimated annual
effective tax rate as adjusted for discrete items, if any, of $6 million on
pre-tax book income of $12 million, and $21 million on pre-tax book income of
$32 million for the six months ended 30 June 2025 and 2024, respectively. This
led to an effective tax rate of 50% and 66% for the six months ended 30 June
2025 and 2024, respectively, with the impact of non-deductible expenses as a
proportion of pre-tax book income being a significant driver in both years.
The decrease in the effective tax rate was primarily driven by an increase in
the recognised deferred tax asset, predominantly in the US, for the six
months ended 30 June 2025 compared to the prior year.
Note 5. Earnings Per Share
The table below illustrates the calculation of basic and diluted earnings per
share:
Six months ended
$m except share and per share amounts 30 June 2024
30 June 2025
Income attributable to ordinary shareholders - basic and diluted
Net income 11 9
Weighted average shares outstanding used in computing earnings per share -
basic and diluted
Weighted average shares - basic 1,012,730,251 1,007,598,732
Weighted average shares - diluted 1,023,609,130 1,018,204,178
Basic income per common share (¢) 1.1 0.9
Diluted income per common share (¢) 1.1 0.9
Antidilutive securities
Weighted average number of share options 43,238,766 35,544,278
Weighted average number of share awards under the CIP, PSP, DSBP and One-off 2,832,724 2,644,290
Award
Weighted average number of shares that would have been issued at average (35,192,611) (27,583,121)
market price
( )
Options are considered dilutive when they would result in the issue of
ordinary shares for less than the market price of ordinary shares in the
period. The amount of the dilution is taken to be the average market price of
shares during the period minus the exercise price. During the six months ended
30 June 2025 and 2024, share awards of 10,878,879 and 10,605,446,
respectively, had a dilutive effect with a negligible impact on the basic
earnings per share.
As discussed within Note 8, Debt, the Company repurchased portions of its
convertible bonds during the six months ended 30 June 2025 and 2024. Due to
the repurchases, the potentially issuable number of shares as of 30 June 2025
and 2024, were 31,054,804 and 50,854,898, respectively. The Convertible bonds
had no dilutive effect for the six months ended 30 June 2025 and 2024.
Note 6. Goodwill, net
The following table shows changes in goodwill period over period:
$m Company - owned Managed & Franchised Digital and Professional Services Total
31 December 2023(1) 885 - 312 1,197
Goodwill acquired 2 - - 2
Currency translation adjustment (21) - (5) (26)
31 December 2024(1) 866 - 307 1,173
Currency translation adjustment 36 - 19 55
30 April 2025 (pre-reallocation) 902 - 326 1,228
Reallocation 26 26 (52) -
30 April 2025 (post-reallocation) 928 26 274 1,228
Currency translation adjustment 16 1 9 26
30 June 2025(1) 944 27 283 1,254
1 Balances are presented net of accumulated impairment losses of $16 million
for the Company-owned segment.
The reallocation of goodwill was based on a relative fair value basis as a
result of the Reorganisation discussed in Note 1, Description of the Business
and Summary of Significant Accounting Policies.
There was no goodwill impairment recorded during the six months ended 30 June
2025 and 2024.
Note 7. Leases
The Company has operating leases for rental of commercial office real estate
premises globally. The following table details the components of lease cost:
Six months ended
$m
30 June 2025 30 June 2024
Operating lease cost(1) 716 699
Short-term lease cost - -
Variable lease cost 66 70
Sublease income (31) (35)
Total lease cost 751 734
1 During the six months ended 30 June 2025 and 2024, the total operating lease
cost was offset by the wind-down of previously capitalised lease incentives of
$24 million and $29 million, respectively.
Note 8. Debt
The following table presents the carrying value of debt as of 30 June 2025 and
31 December 2024:
As of
$m
30 June 2025 31 December 2024
Short-term debt:
Bank overdrafts 30 15
Convertible bonds(1) 192 197
Total short-term debt 222 212
Long-term debt:
Euro bonds 1,058 629
Others(2) 3 4
Total long-term debt 1,061 633
1 As of 30 June 2025 and 31 December 2024, unamortised discounts, premiums,
and debt issuance costs were $0 million and $1 million, respectively.
2 Primarily represent working capital facilities denominated in various
currencies.
On 14 May 2025, the Company issued €300 million Euro bonds at an issuance
price of 99.369%, a fixed coupon rate of 5.125% and a bullet maturity of 14
May 2032. The bonds are traded on the London Stock Exchange's International
Securities Market.
The Company issued £350 million of convertible bonds in December 2020. During
the six months ended 30 June 2025, the Company repurchased £18 million ($23
million) face value of the convertible bonds at a weighted average price of
£0.965, including accrued interest, representing a consideration of £17
million ($22 million).
During the six months ended 30 June 2024, the Company repurchased £118
million face value of the convertible bonds at a weighted average price of
0.9215, including accrued interest, representing a consideration of £109
million.
Due to the repurchases occurring during the six months ended 30 June 2025 and
2024, £18m and £118m, respectively, of the forward exchange rate contracts
entered into during 2024 January, were closed out.
For the six months ended 30 June 2025 and 2024, the repurchases of convertible
bonds and settlement of the foreign exchange rate contracts result in a gain
on settlement of $1 million and $10 million respectively.
As of 30 June 2025, the amount of the Revolving Credit Facility was $720
million and $420 million was available and undrawn. As of December 31, 2024,
the amount of the facility was $720 million and $436 million was available and
undrawn. Further background of the Company's borrowings and underlying
terms, including maturity dates, is included in Note 13, Debt, of the audited
consolidated financial statements as of and for the fiscal year ended 31
December 2024.
On 30 June 2025 the Group complied with all covenants related to the Revolving
Credit Facility.
Note 9. Fair Value Measurements
Fair value is defined as the amount that would be received to sell an asset or
paid to transfer a liability in an orderly transaction between market
participants at the measurement date.
Reference the Fair Value Measurement accounting policy included within Note 1,
Description of the Business and Summary of Significant Accounting Policies, of
the audited consolidated financial statements as of and for the fiscal year
ended 31 December 2024 for the level of inputs outlined below to determine
fair value. The carrying amounts of cash and cash equivalents, restricted
cash, accounts receivable, accounts payable, and accrued liabilities
approximate fair value because of the short maturity of these instruments.
Recurring fair value measurements
The following table presents the carrying amounts and estimated fair values of
the Company's financial instruments as of 30 June 2025 and 31 December 2024:
As of 30 June 2025
$m Carrying amount Level 1 Level 2 Level 3 Total
Assets:
Cross-currency swaps 64 - - 64 64
Forward exchange contracts 14 - - 14 14
Total assets 78 - - 78 78
Liabilities:
Cross-currency swaps 1 - - 1 1
Contingent consideration 7 - - 7 7
Euro bonds 1,058 - 1,132 - 1,132
Convertible bonds 192 - 189 - 189
Total liabilities 1,258 - 1,321 8 1,329
As of 31 December 2024
$m Carrying amount Level 1 Level 2 Level 3 Total
Assets:
Cross-currency swaps 6 - - 6 6
Total assets 6 - - 6 6
Liabilities:
Contingent consideration 7 - - 7 7
Euro bonds 629 - 694 - 694
Convertible bonds 197 - 187 - 187
Forward exchange contracts 3 - - 3 3
Total liabilities 836 - 881 10 891
The fair value of contingent consideration is based on contractually defined
targets of financial performance in connection with earn outs and other
considerations. The fair value of the Euro bonds and convertible bonds are
based on their published prices on the open market. The fair value of the
foreign exchange contracts are based on a combination of forward pricing and
swap models. There were no transfers between levels for the six months ended
30 June 2025 and 30 June 2024.
On 11 April 2025, the Company entered into hedging arrangements to swap €100
million of the Euro bonds notional plus interest into $110 million, with a
weighted-average fixed coupon of 8.265%. As of 30 June 2025, a total of €625
million of the 2024 issuance was hedged, with arrangements to swap into $674
million with a weighted-average fixed coupon of 8.158%. The hedges are
expected to remain in place for the life of the bonds and are designated as
cash flow hedges.
As a result of this hedging arrangement, the Company discontinued its net
investment hedge over the Company's European subsidiaries' operations. Prior
to the discontinuation of the net investment hedge, its impact on other
comprehensive earnings for both the six months ended 30 June 2025 and 2024,
was $0 million.
Simultaneous to the closing of the Euro bonds issued (reference Note 8, Debt)
during May 2025, the Company entered into a hedging arrangement to swap €300
million of the issuance and the related interest into $341 million, with a
weighted-average fixed coupon of 6.902%. The hedge will remain in place for
the life of the bonds and has been designated as a cash flow hedge.
Fair Value of Derivative Instruments
Derivative instruments were recorded at fair value in the consolidated balance
sheets as follows:
As of 30 June 2025
$m Other assets Other liabilities
Cash flow hedges:
Forward exchange contracts - Convertible bonds £141 million 14 -
Cross-currency interest rate swaps - Euro bonds €625 million 64 -
Cross-currency interest rate swaps - Euro bonds €300 million - 1
As of 31 December 2024
$m Other assets Other liabilities
Cash flow hedges:
Forward exchange contracts - Convertible bonds £158 million - 3
Cross-currency interest rate swaps - Euro bonds €525 million 6 -
Net investment hedge:
Euro bonds €100 million - 111
As of 30 June 2025 and 31 December 2024, $14m derivative asset (2024: $2m
derivative liability) relating to the forward exchange contract - Convertible
bond liability and $69m derivative asset (2024: $19m derivative liability)
relating to the cross-currency interest rate swap - Euro bond liability
hedging the principal component of the debt.
Derivative Volume
The gross notional values of our derivative instruments were:
$m As of 30 June 2025
Cash flow hedges:
Forward exchange contracts - Convertible bonds £141 million 179
Cross-currency interest rate swaps - Euro bonds €625 million 674
Cross-currency interest rate swaps- Euro bonds € 300 million 341
$m As of 31 December 2024
Cash flow hedges:
Forward exchange contract - Convertible bonds £158 million 201
Cross-currency interest rate swap - Euro bonds €525 million 564
Net investment hedge:
Euro bonds €100 million 104
Cash flow hedge activity, net of taxes, is recorded within accumulated other
comprehensive earnings/(losses). Refer to Note 11, Accumulated Other
Comprehensive Loss, for further information.
Non-recurring fair value measurements
During the six months ended 30 June 2025 and 2024, the long-lived assets held
and used in certain centres warranted nonrecurring fair value measurements due
to the existence of qualitative and quantitative impairment indicators. The
fair value of the centre was derived based on the expected future cash flows
of the centre as outlined in Note 1, Description of the Business and Summary
of Significant Accounting Policies - Impairment of Long-lived Assets and
Finite-Lived Intangible Assets. The corresponding impairment charges recorded
during the reporting periods presented within these Condensed Consolidated
Financial Statements were also disclosed therein.
During the six months ended 30 June 2025 and 2024, the Company's impairment
assessments derived fair values of $27 million and $200 million, respectively,
for the affected centres.
The categorisation of the framework used to value the right-of-use assets is
considered Level 3, due to the subjective nature of the unobservable inputs
used to determine the fair value. Such judgments and estimates included within
the cash flow forecasts include assessment of the location of the centre, the
local economic situation, competition, local environmental factors, the
management of the centre, and future changes in occupancy, customer pricing
and costs of the centre. While centre costs remain stable, revenue is a
function of the expected levels of occupancy and the corresponding pricing
achieved. In assessing any impairment, the derived fair value is assessed for
sensitivity to changes in both occupancy and pricing, to determine the extent
to which these estimates need to change before an impairment arises.
Note 10. Equity
Cash Dividends
During the six months ended 30 June 2025, the Company approved and paid out a
dividend of $9 million ($0.009 per ordinary share). During the six months
ended 30 June 2024, the Company approved and paid out a dividend of $13
million (£0.01 per ordinary share). The consolidated shareholders' deficit
does not impact the Company's ability to make dividend payments.
Treasury Stock
On 4 March 2025, the Company announced a $50 million share repurchase program,
then on 6 May 2025, the Company extended the share repurchase program by an
additional $50 million to $100 million. Pursuant to the share repurchase
program, during the six months ended 30 June 2025, the Company repurchased
20,652,686 shares of its common stock for $50 million, all of which were
subsequently cancelled.
During the six months ended 30 June 2024, the Company repurchased 118,054
shares totalling $0.2 million.
Note 11. Accumulated Other Comprehensive Loss
The changes in the components of accumulated other comprehensive loss, net of
taxes, were as follows:
$m Foreign Currency Translation Adjustments Total
Cash Flow Hedge Adjustment Net Investment Hedges, Adjustment
Balance as of 1 January 2024 (345) - - (345)
Current-period other comprehensive income (loss) 10 (2) - 8
Amounts reclassified from accumulated other comprehensive income (loss), net - - - -
of taxes
Balance as of 30 June 2024 (335) (2) - (337)
Balance as of 1 January 2025 (339) 23 3 (313)
Current-period other comprehensive income 63 73 - 136
Amounts reclassified from accumulated other comprehensive (loss), net of taxes - (104) (3) (107)
Balance as of 30 June 2025 (276) (8) - (284)
Note 12. Commitments and Contingencies
Contingencies
From time to time, the Company is party to litigation and other legal
proceedings in the ordinary course of business. The Company accrues for loss
contingencies when it is both probable that it will incur the loss and when
the Company can reasonably estimate the amount of the loss or range of loss.
If an unfavourable outcome was to occur, there exists the possibility of a
material adverse impact on the results of operations in the period in which
the outcome occurs or in future periods. The Company expenses legal costs
relating to its lawsuits, claims and proceedings as incurred.
Commitments
The Company has contractual obligations related to centre fit-outs wherein the
Company has to finish or improve the interior space of a leased property.
Capital commitments in respect of centre fit-out obligations that are not
offset by contractually committed landlord contributions are immaterial as of
30 June 2025.
During the six months ended 30 June 2025, there were no material changes in
the bank guarantees, disclosed in Note 18, Commitments and contingencies, of
the audited consolidated financial statements as of and for the fiscal year
ended 31 December 2024.
Note 13. Related Party Transactions
Below is a summary of the Company's related party balances and transactions
for the periods presented herein. Reference Note 19, Related Party
Transactions, of the audited consolidated financial statements as of and for
the year ended 31 December 2024, for further commentary on the nature of the
related party relationships.
Equity Method Investments
The Company's related party balances on its Condensed Consolidated Balance
Sheets as of 30 June 2025 and 31 December 2024 below relate entirely with
parties that are accounted for under the equity method:
As of
$m 30 June 2025 31 December 2024
Accounts receivable, net 50 48
Accounts payable 49 45
During the six months ended 30 June 2025 and 2024, the Company recorded
revenue transactions with related parties accounted for under the equity
method of:
Six months ended
$m 30 June 2025 30 June 2024
Revenue 5 5
The Company had no material expense transactions with equity method investees
during the periods presented.
Other related party transactions
During the six months ended 30 June 2025 and 2024, other related party
expenses were $44 thousand and zero, respectively. As of 30 June 2025 and 31
December 2024, the Company had an outstanding balance of $48 thousand and $1
thousand, respectively.
Note 14. Principal Companies
As of 30 June 2025, the Company's principal subsidiary undertakings, their
principal activities and countries of incorporation are set out below:
Name of undertaking Country of incorporation % of ordinary shares and votes held
Trading companies
Regus Australia Management Pty Ltd Australia 100
Regus Belgium SA Belgium 100
Regus do Brasil Ltda Brazil 100
Regus Business Service (Shenzen) Ltd China 100
Regus Management ApS Denmark 100
Regus Management (Finland) Oy Finland 100
IWG France Management Sarl France 100
Reus Deutschland GmbH Germany 100
Regus Netherlands B.V Netherlands 100
Regus CME Ireland Limited Ireland 100
Regus Business Centres Limited Israel 100
Regus Business Centres Italia S.r.l. Italy 100
Regus Management Malaysia Sdn Bhd Malaysia 100
Regus Management de Mexico, SA de CV Mexico 100
IWG Management Services Morocco Morocco 100
Regus New Zealand Management Ltd New Zealand 100
Regus Business Centre Norge AS Norway 100
IWG Management Sp z.o.o. Poland 100
Regus Business Centre, Lda Portugal 100
Regus Management Singapore Pte Ltd Singapore 100
Regus Management España SL Spain 100
IWG Management (Sweden) AB Sweden 100
Avanta Managed Offices Ltd United Kingdom 100
Basepoint Centres Limited United Kingdom 100
Green (Topco) Limited United Kingdom 100
HQ Global Workplaces LLC United States 100
RGN National Business Centre LLC United States 100
RB Centres LLC United States 100
Regus Management Group LLC United States 100
100
Management companies
RGN Management Limited Partnership Canada 100
Regus Service Centre Philippines B.V. Philippines 100
Franchise International GmbH Switzerland 100
Pathway IP II GmbH Switzerland 100
Regus Global Management Centre SA Switzerland 100
Regus Group Services Ltd United Kingdom 100
IW Group Services (UK) Ltd United Kingdom 100
Regus Management Group LLC United States 100
Holding and finance companies 100
IWG Enterprise Sarl Luxembourg 100
IWG Group Holdings Sarl Luxembourg 100
IWG International Holdings Sarl Luxembourg 100
Ibiza Holdings Limited. Jersey 100
Global Platform Services GmbH Switzerland 100
Regus Group Limited United Kingdom 100
Regus Corporation United States 100
Ibiza Finance Limited. Jersey 100
Genesis Finance GmbH Switzerland 100
Pathway Finance GmbH Switzerland 100
Pathway Finance EUR 2 GmbH Switzerland 100
Pathway Finance USD 2 GmbH Switzerland 100
IWG US Finance LLC United States 100
Note 15. Subsequent Events
The Company evaluated subsequent events through 19 August 2025, which is the
date the Condensed Consolidated Statements were available to be issued.
Statement of directors' responsibilities
For the six months ended 30 June 2025
The Directors are responsible for preparing the half-yearly financial report
in accordance with the Disclosure Guidance and Transparency Rules ("the DTR")
of the UK's Financial Conduct Authority ("the UK FCA").
In preparing the condensed set of financial statements included within the
half-yearly financial report, the directors are required to:
· prepare and present the condensed set of consolidated
financial statements in accordance with principles generally accepted in the
United States of America ("US GAAP");
· ensure the condensed set of consolidated financial statements
has adequate disclosures;
· select and apply appropriate accounting policies; and
· make accounting estimates that are reasonable in the
circumstances.
· assess the Entity's ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to
liquidate the Entity or to cease operations, or have no realistic alternative
but to do so.
The Directors are responsible for designing, implementing and maintaining such
internal controls as they determine is necessary to enable the preparation of
the condensed set of financial statements that is free from material
misstatement whether due to fraud or error.
We confirm that to the best of our knowledge:
1. the condensed set of consolidated financial statements included
within the half-yearly financial report of International Workplace Group plc
for the six months ended 30 June 2025 ("the interim financial information")
which comprises the Condensed Consolidated Statements of Operations, the
Condensed Consolidated Statements of Comprehensive Income (Loss), the
Condensed Consolidated Balance Sheets, the Condensed Consolidated Statement of
Changes in Equity, the Condensed Consolidated Statement of Cash Flows and a
summary of significant accounting policies and other explanatory notes, have
been presented and prepared in accordance with US GAAP and the DTR of the UK
FCA.
2. The interim financial information presented, as required by the DTR
of the UK FCA, includes:
· an indication of important events that have occurred during the
first 6 months of the financial year, and their impact on the condensed set of
financial statements;
· a description of the principal risks and uncertainties for the
remaining 6 months of the financial year;
· related parties' transactions that have taken place in the first
6 months of the current financial year and that have materially affected the
financial position or the performance of the enterprise during that period;
and
· any changes in the related parties' transactions described in the
last annual report that could have a material effect on the financial position
or performance of the enterprise in the first 6 months of the current
financial year.
The directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Entity's website.
Legislation in the UK governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
On behalf of the board
Mark Dixon Charlie Steel
Chief Executive Officer Chief Financial Officer
19 August 2025
This half yearly announcement contains certain forward-looking statements with
respect to the operations of International Workplace Group plc. These
statements and forecasts involve risk and uncertainty because they relate to
events and depend upon circumstances that may or may not occur in the future.
There are several factors that could cause actual results or developments to
differ materially from those expressed or implied by these forward-looking
statements and forecasts. Nothing in this announcement should be construed as
a profit forecast.
Independent Review Report to International Workplace Group plc
Conclusion
We have been engaged by the Entity to review the Entity's condensed set of
consolidated financial statements in the half-yearly financial report for the
six months ended 30 June 2025 which comprises the condensed consolidated
statements of operations, the condensed consolidated statements of
comprehensive income, the condensed consolidated balance sheets, the condensed
consolidated statements of changes in equity, the condensed consolidated
statement of cash flows and a summary of significant accounting policies and
other explanatory notes.
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of consolidated financial statements in the
half-yearly financial report for the six months ended 30 June 2025 is not
prepared, in all material respects in accordance with U.S. Generally Accepted
Accounting Principles (US GAAP).
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410 Review of Interim Financial Information Performed by the
Independent Auditor of the Entity ("ISRE (UK) 2410") issued for use in the
UK. A review of interim financial information consists of making enquiries,
primarily of persons responsible for financial and accounting matters, and
applying analytical and other review procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and consequently does not enable
us to obtain assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention that causes us to believe that the directors
have inappropriately adopted the going concern basis of accounting, or that
the directors have identified material uncertainties relating to going concern
that have not been appropriately disclosed.
This conclusion is based on the review procedures performed in accordance with
ISRE (UK) 2410. However, future events or conditions may cause the Entity to
cease to continue as a going concern, and the above conclusions are not a
guarantee that the Entity will continue in operation.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the directors. The directors are responsible for preparing the
half-yearly financial report in accordance with the DTR of the UK FCA.
The directors are responsible for preparing the condensed set of consolidated
financial statements included in the half-yearly financial report in
accordance with US GAAP.
The annual financial statements of the Entity for the year ended 31 December
2024 are prepared in accordance with UK-adopted international accounting
standards.
In preparing the condensed set of consolidated financial statements, the
directors are responsible for assessing the Entity's ability to continue as a
going concern, disclosing, as applicable, matters related to going concern and
using the going concern basis of accounting unless the directors either intend
to liquidate the Entity or to cease operations, or have no realistic
alternative but to do so.
Our responsibility
Our responsibility is to express to the Entity a conclusion on the condensed
set of consolidated financial statements in the half-yearly financial report
based on our review.
Our conclusion, including our conclusions relating to going concern, are based
on procedures that are less extensive than audit procedures, as described in
the Basis for conclusion section of this report.
The purpose of our review work and to whom we owe our responsibilities
This report is made solely to the Entity in accordance with the terms of our
engagement to assist the Entity in meeting the requirements of the DTR of the
UK FCA. Our review has been undertaken so that we might state to the Entity
those matters we are required to state to it in this report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Entity for our review work, for this
report, or for the conclusions we have reached.
KPMG 18 August 2025
Chartered Accountants
1 Stokes Place
St. Stephen's Green
Dublin 2 D02 DE03
Ireland
Reconciliation for alternative performance measures
The Company reports certain alternative performance measures (APMs) that are
not required under US GAAP which represents the generally accepted accounting
principles (GAAP) under which the Company reports. The Company believes that
the presentation of these APMs provides useful supplemental information, when
viewed in conjunction with our US GAAP financial information as follows:
· To evaluate the historical and planned underlying results of our
operations;
· To set Director and management remuneration; and
· To discuss and explain the Company's performance with the
investment analyst community.
None of the APMs should be considered as an alternative to financial measures
derived in accordance with GAAP. The APMs can have limitations as analytical
tools and should not be considered in isolation or as a substitute for an
analysis of our results as reported under GAAP. These performance measures may
not be calculated uniformly by all companies and therefore may not be directly
comparable with similarly titled measures and disclosures of other companies.
Adjusted EBITDA:
Six months ended
$m 30 June 2025 30 June 2024
Operating income 68 68
Condensed Consolidated Statements of
Operations
Add back: 182 171
Depreciation and amortisation 140 139
Depreciation of landlord contributions on leases 42 32
Adjusting items: 12 8
Impairment of long-lived assets Condensed 17 34
Consolidated
Statements of
Operations
(Gain) loss on disposal of (5) (26)
long-lived assets and other
closure related (credits) costs
Adjusted EBITDA 247
262
Net Debt:
As of
$m 30 June 2025 31 December 2024
Cash and cash equivalents Condensed Consolidated Balance Sheets (446) (137)
Short-term debt, net 222 212
Long-term debt, net 1,061 633
Cash flow hedges Note 9, Fair Value Measurements (83) 21
Net Debt 754 729
Adjusted gross profit:
Networks
$m Company-owned Managed & Franchised Digital and Professional Services Total
30 June 2025
Gross profit 345 50 86 481
Landlord contributions on leases included in depreciation and amortisation 30 - 12 42
Adjusted gross profit 375 50 98 523
30 June 2024
Gross profit 314 35 122 471
Landlord contributions on leases included in depreciation and amortisation 32 - - 32
Adjusted gross profit 346 35 122 503
Glossary:
Adjusted EBITDA
EBITDA excluding adjusting items.
Adjusted gross profit
Gross profit excluding adjusting items
Adjusting items
Adjusting items reflects the impact of adjustments, both incomes and costs not
indicative of the underlying performance, which are considered to be
significant in nature and/or size.
Capital-light
Business centres operating under a variable lease, joint-venture, managed and
franchised arrangements.
Company-owned
Locations the Company operates directly and recognises full revenue and costs
of the centre.
Digital and Professional Services
Services and technology provided to customers and landlords.
EBIT
Earnings before interest and tax.
EBITDA
Earnings before interest, tax, depreciation and amortisation.
EPS
Earnings per share.
Expansions
A general term which includes new business centres established by IWG and
acquired centres in the year.
Growth capital expenditure
Capital expenditure in respect of centres which opened during the current or
prior financial period and technology spend supporting operational growth.
Growth-related landlord contributions (leased centres)
Landlord contributions received in respect of leased centres which opened
during the current or prior financial period.
IWG Network
Company-owned and Managed & Franchised comprises the IWG Network.
Maintenance capital expenditure (leased centres)
Capital expenditure in respect of centres owned for a full 12-month period
prior to the start of the financial year and operated throughout the current
financial year, which therefore have a full-year comparative.
Maintenance-related landlord contributions (leased centres)
Landlord contributions received in respect of centres leased for a full
12-month period prior to the start of the financial year and operated
throughout the current financial year, which therefore have a full
year‑ comparative.
Managed & Franchised
Locations the Company receives a franchise or management fee for providing
services to centres. Managed centres are operated by the Company; franchise
locations are operated by the franchise holder. The Company only recognises
the fee as revenue. The Company is not responsible for capital expenditures in
the centres and does not recognise the related centre operating costs.
Net debt
Operations cash and cash equivalents, adjusted for both short and long-term
debt, and the portion of derivatives that hedge the principal component of
debt. Net debt excludes lease liabilities.
Occupancy
Occupied square metres divided by total inventory square metres expressed as a
percentage where contracts are in place with a minimum term of one month.
Rooms
The yearly average total business centre square meters divided by a standard
room of seven square meters.
RevPAR
Monthly average IWG Network revenue, divided by the average available number
of rooms, excluding rooms opened and closed in the period
System-wide revenue
Refers to the total revenue generated across IWG network, including revenue
from franchise, managed centre and joint-venture partners, but excluding
related fee income.
TSR
Total shareholder return
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