An intermediate language (or representation) is the internal representation of code used for program transformation and reasoning about the code. This is not what the story is talking about - all the benefits are about the object representation (the compiler emits C code), and the presented compiler does not distinguish between the intermediate representation and the object representation; it does not need to, as it does no optimisations. There's nothing innovative about emitting C code from a compiler - it used to be more common than it is now.

There has been a little bit of research done on writing optimising compilers that use source-code-like intermediate representations: the Janus project from the 1990s springs to mind.