Hilton Worldwide Holdings Inc. (NYSE: HLT) today reported its first quarter 2023 results. Highlights include:
- Diluted EPS was $0.77 for the first quarter, and diluted EPS, adjusted for special items, was $1.24
- Net income was $209 million for the first quarter
- Adjusted EBITDA was $641 million for the first quarter
- System-wide comparable RevPAR increased 30.0 percent, on a currency neutral basis, for the first quarter compared to the same period in 2022
- System-wide comparable RevPAR increased 8.0 percent, on a currency neutral basis, for the first quarter compared to the same period in 2019
- Approved 24,900 new rooms for development during the first quarter, bringing Hilton's development pipeline to 428,100 rooms as of March 31, 2023
- Added 9,200 rooms to Hilton's system in the first quarter, resulting in 5,300 net additional rooms in Hilton's system during the period
- Repurchased 3.2 million shares of Hilton common stock during the first quarter, bringing total capital return, including dividends, to $487 million for the quarter and more than $602 million year to date through April
- Full year 2023 system-wide RevPAR is expected to increase between 8 percent and 11 percent on a comparable and currency neutral basis compared to 2022; full year net income is projected to be between $1,331 million and $1,385 million; full year Adjusted EBITDA is projected to be between $2,875 million and $2,950 million
- Full year 2023 capital return is projected to be between $1.8 billion and $2.2 billion
Overview
Christopher J. Nassetta, President & Chief Executive Officer of Hilton, said, "We carried strong momentum into 2023, exceeding the high end of our guidance for system-wide RevPAR, driving strong bottom-line results and delivering meaningful free cash flow available for return to our shareholders. As a result of our strong performance and positive outlook, we are raising our Adjusted EBITDA guidance for the full year."
For the three months ended March 31, 2023, system-wide comparable RevPAR increased 30.0 percent compared to the same period in 2022, due to increases in both occupancy and ADR, and management and franchise fee revenues increased 30.1 percent compared to the same period in 2022. For comparison to pre-pandemic results, system-wide comparable RevPAR for the three months ended March 31, 2023 increased 8.0 percent compared to the same period in 2019, and management and franchise fee revenues increased 26.3 percent from the same period in 2019.
For the three months ended March 31, 2023, diluted EPS was $0.77 and diluted EPS, adjusted for special items, was $1.24 compared to $0.75 and $0.71, respectively, for the three months ended March 31, 2022. Net income and Adjusted EBITDA were $209 million and $641 million, respectively, for the three months ended March 31, 2023, compared to $211 million and $448 million, respectively, for the three months ended March 31, 2022.
Development
In the first quarter of 2023, Hilton opened 64 new hotels totaling 9,200 rooms and achieved net unit growth of 5,300 rooms. Additionally, Hilton started construction on over 19,000 hotel rooms during the first quarter, continuing the positive momentum from the end of 2022, particularly in China. Further, Hilton continued to achieve development milestones during the first quarter, opening the 100th Tapestry Collection by Hilton, as well as its 500th hotel in China.
As of March 31, 2023, Hilton's development pipeline totaled approximately 2,930 hotels representing 428,100 rooms throughout 116 countries and territories, including 30 countries and territories where Hilton did not have any existing hotels. Additionally, of the rooms in the development pipeline, 215,700 of the rooms were under construction and 246,200 of the rooms were located outside of the U.S. In April, Hilton announced a notable addition to its development pipeline, the Waldorf Astoria Jaipur, which will mark the debut of the Waldorf Astoria Hotels & Resorts brand in India.
Balance Sheet and Liquidity
As of March 31, 2023, Hilton had $8.8 billion of long-term debt outstanding, excluding the deduction for deferred financing costs and discount, with a weighted average interest rate of 4.51 percent. Excluding all finance lease liabilities and other debt of Hilton's consolidated variable interest entities, Hilton had $8.6 billion of long-term debt outstanding with a weighted average interest rate of 4.50 percent and no scheduled maturities until May 2025. As of March 31, 2023, no debt amounts were outstanding under Hilton's $2.0 billion senior secured revolving credit facility, which had an available borrowing capacity of $1,940 million after considering $60 million of outstanding letters of credit. Total cash and cash equivalents were $978 million as of March 31, 2023, including $77 million of restricted cash and cash equivalents.
During the three months ended March 31, 2023, Hilton repurchased 3.2 million shares of its common stock at an average price per share of $139.88, returning $446 million of capital to shareholders. Through April 21, 2023, since the inception of Hilton's stock repurchase program in March 2017, Hilton repurchased approximately 56.4 million shares of its common stock for approximately $5.4 billion at an average price per share of $96.39. The amount remaining under Hilton's stock repurchase program is approximately $2.6 billion.
In March 2023, Hilton paid a quarterly cash dividend of $0.15 per share of common stock, bringing total dividend payments for the quarter to $41 million. In April 2023, Hilton's board of directors authorized a regular quarterly cash dividend of $0.15 per share of common stock to be paid on or before June 30, 2023 to holders of record of its common stock as of the close of business on May 19, 2023.
Outlook
Share-based metrics in Hilton's outlook include actual share repurchases to date, but do not include the effect of potential share repurchases hereafter.
Full Year 2023
- System-wide comparable RevPAR, on a currency neutral basis, is expected to increase between 8 percent and 11 percent compared to 2022.
- Diluted EPS is projected to be between $4.95 and $5.14.
- Diluted EPS, adjusted for special items, is projected to be between $5.68 and $5.88.
- Net income is projected to be between $1,331 million and $1,385 million.
- Adjusted EBITDA is projected to be between $2,875 million and $2,950 million.
- Contract acquisition costs and capital expenditures, excluding amounts reimbursed by third parties, are expected to be approximately $300 million.
- Capital return is projected to be between $1.8 billion and $2.2 billion.
- General and administrative expenses are projected to be between $390 million and $410 million.
- Net unit growth is expected to be between 5.0 percent and 5.5 percent.
Second Quarter 2023
- System-wide comparable RevPAR, on a currency neutral basis, is expected to increase between 10 percent and 12 percent compared to the second quarter of 2022.
- Diluted EPS is projected to be between $1.45 and $1.50.
- Diluted EPS, adjusted for special items, is projected to be between $1.54 and $1.59.
- Net income is projected to be between $387 million and $401 million.
- Adjusted EBITDA is projected to be between $770 million and $790 million.
| HILTON WORLDWIDE HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except per share data) (unaudited) | |||||||
|
| Three Months Ended | ||||||
|
| March 31, | ||||||
|
| 2023 |
| 2022 | ||||
| Revenues |
|
|
| ||||
| Franchise and licensing fees | $ | 508 |
|
| $ | 413 |
|
| Base and other management fees |
| 80 |
|
|
| 55 |
|
| Incentive management fees |
| 65 |
|
|
| 34 |
|
| Owned and leased hotels |
| 248 |
|
|
| 150 |
|
| Other revenues |
| 35 |
|
|
| 18 |
|
|
|
| 936 |
|
|
| 670 |
|
| Other revenues from managed and franchised properties |
| 1,357 |
|
|
| 1,051 |
|
| Total revenues |
| 2,293 |
|
|
| 1,721 |
|
|
|
|
|
| ||||
| Expenses |
|
|
| ||||
| Owned and leased hotels |
| 251 |
|
|
| 185 |
|
| Depreciation and amortization |
| 37 |
|
|
| 44 |
|
| General and administrative |
| 91 |
|
|
| 91 |
|
| Other expenses |
| 21 |
|
|
| 11 |
|
|
|
| 400 |
|
|
| 331 |
|
| Other expenses from managed and franchised properties |
| 1,395 |
|
|
| 1,021 |
|
| Total expenses |
| 1,795 |
|
|
| 1,352 |
|
|
|
|
|
| ||||
| Operating income |
| 498 |
|
|
| 369 |
|
|
|
|
|
| ||||
| Interest expense |
| (116 | ) |
|
| (90 | ) |
| Loss on foreign currency transactions |
| — |
|
|
| (4 | ) |
| Loss on investments in unconsolidated affiliate |
| (92 | ) |
|
| — |
|
| Other non-operating income, net |
| 12 |
|
|
| 16 |
|
|
|
|
|
| ||||
| Income before income taxes |
| 302 |
|
|
| 291 |
|
|
|
|
|
| ||||
| Income tax expense |
| (93 | ) |
|
| (80 | ) |
|
|
|
|
| ||||
| Net income |
| 209 |
|
|
| 211 |
|
| Net loss (income) attributable to noncontrolling interests |
| (3 | ) |
|
| 1 |
|
| Net income attributable to Hilton stockholders | $ | 206 |
|
| $ | 212 |
|
|
|
|
|
| ||||
| Weighted average shares outstanding: |
|
|
| ||||
| Basic |
| 266 |
|
|
| 279 |
|
| Diluted |
| 269 |
|
|
| 282 |
|
|
|
|
|
| ||||
| Earnings per share: |
|
|
| ||||
| Basic | $ | 0.77 |
|
| $ | 0.76 |
|
| Diluted | $ | 0.77 |
|
| $ | 0.75 |
|
|
|
|
|
| ||||
| Cash dividends declared per share | $ | 0.15 |
|
| $ | — |
|
| HILTON WORLDWIDE HOLDINGS INC. COMPARABLE AND CURRENCY NEUTRAL SYSTEM-WIDE HOTEL OPERATING STATISTICS BY REGION, BRAND AND SEGMENT (unaudited) | ||||||||||||||||||
|
| Three Months Ended March 31, | |||||||||||||||||
|
| Occupancy |
| ADR |
| RevPAR | |||||||||||||
|
| 2023 |
| vs. 2022 |
| 2023 |
| vs. 2022 |
| 2023 |
| vs. 2022 | |||||||
| Region |
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| U.S. | 68.6 | % |
| 6.5 | % | pts. |
| $ | 159.67 |
| 10.0 | % |
| $ | 109.56 |
| 21.4 | % |
| Americas (excluding U.S.) | 65.5 |
|
| 14.7 |
|
|
|
| 147.48 |
| 21.0 |
|
|
| 96.62 |
| 56.0 |
|
| Europe | 62.1 |
|
| 15.3 |
|
|
|
| 142.42 |
| 27.0 |
|
|
| 88.38 |
| 68.4 |
|
| Middle East & Africa | 74.3 |
|
| 8.1 |
|
|
|
| 175.13 |
| 17.6 |
|
|
| 130.12 |
| 32.1 |
|
| Asia Pacific | 65.8 |
|
| 24.1 |
|
|
|
| 116.18 |
| 21.3 |
|
|
| 76.42 |
| 91.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| Brand |
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| Waldorf Astoria Hotels & Resorts | 61.8 | % |
| 15.7 | % | pts. |
| $ | 560.91 |
| (9.1 | )% |
| $ | 346.61 |
| 21.9 | % |
| LXR Hotels & Resorts | 45.9 |
|
| 4.0 |
|
|
|
| 489.29 |
| 0.5 |
|
|
| 224.69 |
| 10.2 |
|
| Conrad Hotels & Resorts | 69.3 |
|
| 21.3 |
|
|
|
| 282.82 |
| 23.1 |
|
|
| 195.85 |
| 77.8 |
|
| Canopy by Hilton | 64.8 |
|
| 16.5 |
|
|
|
| 210.64 |
| 12.5 |
|
|
| 136.42 |
| 50.9 |
|
| Hilton Hotels & Resorts | 64.8 |
|
| 15.9 |
|
|
|
| 185.99 |
| 13.8 |
|
|
| 120.54 |
| 50.7 |
|
| Curio Collection by Hilton | 66.5 |
|
| 14.5 |
|
|
|
| 229.39 |
| 3.5 |
|
|
| 152.63 |
| 32.3 |
|
| DoubleTree by Hilton | 63.6 |
|
| 9.9 |
|
|
|
| 137.76 |
| 10.7 |
|
|
| 87.59 |
| 31.2 |
|
| Tapestry Collection by Hilton | 62.4 |
|
| 7.0 |
|
|
|
| 168.90 |
| 13.6 |
|
|
| 105.41 |
| 28.1 |
|
| Embassy Suites by Hilton | 69.3 |
|
| 9.8 |
|
|
|
| 177.22 |
| 9.2 |
|
|
| 122.74 |
| 27.1 |
|
| Hilton Garden Inn | 67.1 |
|
| 8.1 |
|
|
|
| 138.99 |
| 11.2 |
|
|
| 93.25 |
| 26.6 |
|
| Hampton by Hilton | 68.2 |
|
| 8.2 |
|
|
|
| 124.90 |
| 7.0 |
|
|
| 85.24 |
| 21.6 |
|
| Tru by Hilton | 68.0 |
|
| 5.9 |
|
|
|
| 122.08 |
| 7.9 |
|
|
| 82.96 |
| 18.1 |
|
| Homewood Suites by Hilton | 76.5 |
|
| 2.8 |
|
|
|
| 149.95 |
| 10.5 |
|
|
| 114.75 |
| 14.6 |
|
| Home2 Suites by Hilton | 76.8 |
|
| 3.5 |
|
|
|
| 136.76 |
| 9.6 |
|
|
| 105.05 |
| 14.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| Segment |
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| Management and franchise | 67.8 | % |
| 9.5 | % | pts. |
| $ | 152.51 |
| 10.9 | % |
| $ | 103.36 |
| 29.1 | % |
| Ownership(1) | 62.9 |
|
| 25.7 |
|
|
|
| 204.01 |
| 26.7 |
|
|
| 128.34 |
| 114.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
| System-wide | 67.7 | % |
| 9.8 | % | pts. |
| $ | 153.20 |
| 11.2 | % |
| $ | 103.72 |
| 30.0 | % |
| ____________ | |
| (1) | Includes hotels owned or leased by entities in which Hilton owns a noncontrolling financial interest. |
| HILTON WORLDWIDE HOLDINGS INC. PROPERTY SUMMARY As of March 31, 2023 | |||||||||||||||
|
| Owned / Leased(1) |
| Managed |
| Franchised |
| Total | ||||||||
|
| Properties |
| Rooms |
| Properties |
| Rooms |
| Properties |
| Rooms |
| Properties |
| Rooms |
| Waldorf Astoria Hotels & Resorts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 12 |
| 4,437 |
| — |
| — |
| 12 |
| 4,437 |
| Americas (excluding U.S.) | — |
| — |
| 3 |
| 425 |
| — |
| — |
| 3 |
| 425 |
| Europe | 2 |
| 463 |
| 4 |
| 898 |
| — |
| — |
| 6 |
| 1,361 |
| Middle East & Africa | — |
| — |
| 7 |
| 1,867 |
| — |
| — |
| 7 |
| 1,867 |
| Asia Pacific | — |
| — |
| 6 |
| 1,259 |
| — |
| — |
| 6 |
| 1,259 |
| LXR Hotels & Resorts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| — |
| — |
| 3 |
| 522 |
| 3 |
| 522 |
| Americas (excluding U.S.) | — |
| — |
| — |
| — |
| 1 |
| 76 |
| 1 |
| 76 |
| Europe | — |
| — |
| 1 |
| 70 |
| 1 |
| 307 |
| 2 |
| 377 |
| Middle East & Africa | — |
| — |
| 1 |
| 41 |
| 3 |
| 282 |
| 4 |
| 323 |
| Asia Pacific | — |
| — |
| — |
| — |
| 1 |
| 114 |
| 1 |
| 114 |
| Conrad Hotels & Resorts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 6 |
| 2,227 |
| 2 |
| 1,730 |
| 8 |
| 3,957 |
| Americas (excluding U.S.) | — |
| — |
| 3 |
| 787 |
| — |
| — |
| 3 |
| 787 |
| Europe | — |
| — |
| 4 |
| 1,155 |
| 1 |
| 107 |
| 5 |
| 1,262 |
| Middle East & Africa | 1 |
| 614 |
| 4 |
| 1,689 |
| — |
| — |
| 5 |
| 2,303 |
| Asia Pacific | 1 |
| 164 |
| 23 |
| 7,082 |
| 1 |
| 659 |
| 25 |
| 7,905 |
| Canopy by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| — |
| — |
| 26 |
| 4,490 |
| 26 |
| 4,490 |
| Americas (excluding U.S.) | — |
| — |
| 2 |
| 272 |
| 1 |
| 184 |
| 3 |
| 456 |
| Europe | — |
| — |
| 1 |
| 123 |
| 4 |
| 917 |
| 5 |
| 1,040 |
| Middle East & Africa | — |
| — |
| 1 |
| 200 |
| — |
| — |
| 1 |
| 200 |
| Asia Pacific | — |
| — |
| 4 |
| 614 |
| — |
| — |
| 4 |
| 614 |
| Signia by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 2 |
| 1,814 |
| — |
| — |
| 2 |
| 1,814 |
| Hilton Hotels & Resorts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 59 |
| 44,208 |
| 187 |
| 58,761 |
| 246 |
| 102,969 |
| Americas (excluding U.S.) | 1 |
| 405 |
| 31 |
| 11,784 |
| 23 |
| 6,791 |
| 55 |
| 18,980 |
| Europe | 37 |
| 11,135 |
| 44 |
| 15,109 |
| 44 |
| 11,483 |
| 125 |
| 37,727 |
| Middle East & Africa | 4 |
| 1,705 |
| 38 |
| 13,041 |
| 4 |
| 1,738 |
| 46 |
| 16,484 |
| Asia Pacific | 5 |
| 2,999 |
| 114 |
| 39,883 |
| 9 |
| 3,557 |
| 128 |
| 46,439 |
| Curio Collection by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 11 |
| 4,979 |
| 63 |
| 13,003 |
| 74 |
| 17,982 |
| Americas (excluding U.S.) | — |
| — |
| 2 |
| 99 |
| 17 |
| 2,200 |
| 19 |
| 2,299 |
| Europe | — |
| — |
| 6 |
| 516 |
| 27 |
| 3,534 |
| 33 |
| 4,050 |
| Middle East & Africa | — |
| — |
| 4 |
| 741 |
| 2 |
| 557 |
| 6 |
| 1,298 |
| Asia Pacific | — |
| — |
| 4 |
| 773 |
| 2 |
| 248 |
| 6 |
| 1,021 |
| DoubleTree by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 31 |
| 10,131 |
| 348 |
| 79,228 |
| 379 |
| 89,359 |
| Americas (excluding U.S.) | — |
| — |
| 3 |
| 587 |
| 39 |
| 7,823 |
| 42 |
| 8,410 |
| Europe | — |
| — |
| 15 |
| 3,770 |
| 109 |
| 18,774 |
| 124 |
| 22,544 |
| Middle East & Africa | — |
| — |
| 20 |
| 5,568 |
| 4 |
| 670 |
| 24 |
| 6,238 |
| Asia Pacific | — |
| — |
| 84 |
| 22,375 |
| 8 |
| 2,101 |
| 92 |
| 24,476 |
| HILTON WORLDWIDE HOLDINGS INC. PROPERTY SUMMARY (continued) As of March 31, 2023 | |||||||||||||||
|
| Owned / Leased(1) |
| Managed |
| Franchised |
| Total | ||||||||
|
| Properties |
| Rooms |
| Properties |
| Rooms |
| Properties |
| Rooms |
| Properties |
| Rooms |
| Tapestry Collection by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| — |
| — |
| 83 |
| 10,002 |
| 83 |
| 10,002 |
| Americas (excluding U.S.) | — |
| — |
| 1 |
| 138 |
| 7 |
| 740 |
| 8 |
| 878 |
| Europe | — |
| — |
| — |
| — |
| 7 |
| 410 |
| 7 |
| 410 |
| Middle East & Africa | — |
| — |
| 1 |
| 50 |
| — |
| — |
| 1 |
| 50 |
| Asia Pacific | — |
| — |
| 1 |
| 266 |
| 1 |
| 175 |
| 2 |
| 441 |
| Embassy Suites by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 38 |
| 10,125 |
| 217 |
| 48,810 |
| 255 |
| 58,935 |
| Americas (excluding U.S.) | — |
| — |
| 2 |
| 504 |
| 7 |
| 1,829 |
| 9 |
| 2,333 |
| Middle East & Africa | — |
| — |
| — |
| — |
| 1 |
| 151 |
| 1 |
| 151 |
| Motto by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| — |
| — |
| 3 |
| 871 |
| 3 |
| 871 |
| Americas (excluding U.S.) | — |
| — |
| — |
| — |
| 1 |
| 115 |
| 1 |
| 115 |
| Europe | — |
| — |
| — |
| — |
| 1 |
| 108 |
| 1 |
| 108 |
| Hilton Garden Inn |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 6 |
| 689 |
| 737 |
| 101,860 |
| 743 |
| 102,549 |
| Americas (excluding U.S.) | — |
| — |
| 12 |
| 1,838 |
| 53 |
| 7,952 |
| 65 |
| 9,790 |
| Europe | — |
| — |
| 13 |
| 2,524 |
| 64 |
| 10,312 |
| 77 |
| 12,836 |
| Middle East & Africa | — |
| — |
| 17 |
| 3,555 |
| 3 |
| 474 |
| 20 |
| 4,029 |
| Asia Pacific | — |
| — |
| 59 |
| 12,892 |
| 7 |
| 1,149 |
| 66 |
| 14,041 |
| Hampton by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 23 |
| 2,986 |
| 2,318 |
| 229,522 |
| 2,341 |
| 232,508 |
| Americas (excluding U.S.) | — |
| — |
| 12 |
| 1,537 |
| 117 |
| 14,166 |
| 129 |
| 15,703 |
| Europe | — |
| — |
| 16 |
| 2,697 |
| 109 |
| 17,044 |
| 125 |
| 19,741 |
| Middle East & Africa | — |
| — |
| 5 |
| 1,459 |
| — |
| — |
| 5 |
| 1,459 |
| Asia Pacific | — |
| — |
| — |
| — |
| 288 |
| 45,832 |
| 288 |
| 45,832 |
| Tru by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| — |
| — |
| 233 |
| 22,762 |
| 233 |
| 22,762 |
| Americas (excluding U.S.) | — |
| — |
| — |
| — |
| 4 |
| 453 |
| 4 |
| 453 |
| Homewood Suites by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 9 |
| 1,131 |
| 500 |
| 57,157 |
| 509 |
| 58,288 |
| Americas (excluding U.S.) | — |
| — |
| 3 |
| 406 |
| 24 |
| 2,688 |
| 27 |
| 3,094 |
| Home2 Suites by Hilton |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| U.S. | — |
| — |
| 2 |
| 210 |
| 553 |
| 57,901 |
| 555 |
| 58,111 |
| Americas (excluding U.S.) | — |
| — |
| — |
| — |
| 8 |
| 845 |
| 8 |
| 845 |
| Asia Pacific | — |
| — |
| — |
| — |
| 26 |
| 3,946 |
| 26 |
| 3,946 |
| Other | — |
| — |
| 4 |
| 1,442 |
| 6 |
| 1,436 |
| 10 |
| 2,878 |
| Total hotels | 51 |
| 17,485 |
| 774 |
| 242,973 |
| 6,308 |
| 858,566 |
| 7,133 |
| 1,119,024 |
| Hilton Grand Vacations | — |
| — |
| — |
| — |
| 82 |
| 14,253 |
| 82 |
| 14,253 |
| Total system | 51 |
| 17,485 |
| 774 |
| 242,973 |
| 6,390 |
| 872,819 |
| 7,215 |
| 1,133,277 |
| ____________ | |
| (1) | Includes hotels owned or leased by entities in which Hilton owns a noncontrolling financial interest. |
| HILTON WORLDWIDE HOLDINGS INC. CAPITAL EXPENDITURES AND CONTRACT ACQUISITION COSTS (dollars in millions) (unaudited) | |||||||||
|
| Three Months Ended |
|
| ||||||
|
| March 31, |
| Increase / (Decrease) | ||||||
|
| 2023 |
| 2022 |
| $ |
| % | ||
| Capital expenditures for property and equipment(2) | $ | 44 |
| $ | 4 |
| 40 |
| NM(1) |
| Capitalized software costs(3) |
| 19 |
|
| 10 |
| 9 |
| 90.0 |
| Total capital expenditures |
| 63 |
|
| 14 |
| 49 |
| NM(1) |
| Contract acquisition costs, net of refunds(4) |
| 105 |
|
| 15 |
| 90 |
| NM(1) |
| Total capital expenditures and contract acquisition costs | $ | 168 |
| $ | 29 |
| 139 |
| NM(1) |
| ____________ | |
| (1) | Fluctuation in terms of percentage change is not meaningful. |
| (2) | Represents expenditures for hotels, corporate and other property and equipment, which include amounts reimbursed by third parties of $2 million and less than $1 million for the three months ended March 31, 2023 and 2022, respectively. Excludes expenditures for FF&E replacement reserves of $8 million and $12 million for the three months ended March 31, 2023 and 2022, respectively. |
| (3) | Includes $18 million and $9 million of expenditures that were reimbursed by third parties for the three months ended March 31, 2023 and 2022, respectively. |
| (4) | The increase during the period was due to the timing of certain strategic hotel developments supporting Hilton's growth. |
| HILTON WORLDWIDE HOLDINGS INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES NET INCOME AND DILUTED EPS, ADJUSTED FOR SPECIAL ITEMS (in millions, except per share data) (unaudited) | |||||||
|
| Three Months Ended | ||||||
|
| March 31, | ||||||
|
| 2023 |
| 2022 | ||||
| Net income attributable to Hilton stockholders, as reported | $ | 206 |
|
| $ | 212 |
|
| Diluted EPS, as reported | $ | 0.77 |
|
| $ | 0.75 |
|
| Special items: |
|
|
| ||||
| Net other expenses (revenues) from managed and franchised properties | $ | 38 |
|
| $ | (30 | ) |
| Purchase accounting amortization(1) |
| 11 |
|
|
| 12 |
|
| Loss on investments in unconsolidated affiliate(2) |
| 92 |
|
|
| — |
|
| FF&E replacement reserves |
| 8 |
|
|
| 12 |
|
| Other adjustments(3) |
| 5 |
|
|
| (10 | ) |
| Total special items before taxes |
| 154 |
|
|
| (16 | ) |
| Income tax benefit (expense) on special items |
| (27 | ) |
|
| 5 |
|
| Total special items after taxes | $ | 127 |
|
| $ | (11 | ) |
|
|
|
|
| ||||
| Net income, adjusted for special items | $ | 333 |
|
| $ | 201 |
|
| Diluted EPS, adjusted for special items | $ | 1.24 |
|
| $ | 0.71 |
|
| ____________ | |
| (1) | Amounts represent the amortization expense related to finite-lived intangible assets that were recorded at fair value in 2007 when the Company became a wholly owned subsidiary of affiliates of Blackstone Inc. The majority of the related assets will be fully amortized during 2023. |
| (2) | Amount for the three months ended March 31, 2023 includes losses recognized related to equity and debt financing that Hilton had previously provided to an unconsolidated affiliate with underlying investments in hotels that Hilton currently or in the future will manage or franchise. |
| (3) | Amounts include net losses (gains) related to certain of Hilton's investments in unconsolidated affiliates, other than the loss included separately in "loss on investments in unconsolidated affiliate," which were recognized in other non-operating income, net. |
| HILTON WORLDWIDE HOLDINGS INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES NET INCOME MARGIN AND ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (dollars in millions) (unaudited) | |||||||
|
| Three Months Ended | ||||||
|
| March 31, | ||||||
|
| 2023 |
| 2022 | ||||
| Net income | $ | 209 |
| $ | 211 |
| |
| Interest expense |
| 116 |
|
| 90 |
| |
| Income tax expense |
| 93 |
|
| 80 |
| |
| Depreciation and amortization expenses |
| 37 |
|
| 44 |
| |
| EBITDA |
| 455 |
|
| 425 |
| |
| Loss on foreign currency transactions |
| — |
|
| 4 |
| |
| Loss on investments in unconsolidated affiliate(1) |
| 92 |
|
| — |
| |
| FF&E replacement reserves |
| 8 |
|
| 12 |
| |
| Share-based compensation expense |
| 33 |
|
| 37 |
| |
| Amortization of contract acquisition costs |
| 10 |
|
| 8 |
| |
| Net other expenses (revenues) from managed and franchised properties |
| 38 |
|
| (30 | ) | |
| Other adjustments(2) |
| 5 |
|
| (8 | ) | |
| Adjusted EBITDA | $ | 641 |
| $ | 448 |
| |
| ____________ | |
| (1) | Amount for the three months ended March 31, 2023 includes losses recognized related to equity and debt financing that Hilton had previously provided to an unconsolidated affiliate with underlying investments in hotels that Hilton currently or in the future will manage or franchise. |
| (2) | All periods include net losses (gains) related to certain of Hilton's investments in unconsolidated affiliates, other than the loss included separately in "loss on investments in unconsolidated affiliate," severance and other items. |
|
| Three Months Ended | ||||||
|
| March 31, | ||||||
|
| 2023 |
| 2022 | ||||
| Total revenues, as reported | $ | 2,293 |
|
| $ | 1,721 |
|
| Add: amortization of contract acquisition costs |
| 10 |
|
|
| 8 |
|
| Less: other revenues from managed and franchised properties |
| (1,357 | ) |
|
| (1,051 | ) |
| Total revenues, as adjusted | $ | 946 |
|
| $ | 678 |
|
|
|
|
|
| ||||
| Net income | $ | 209 |
|
| $ | 211 |
|
| Net income margin |
| 9.1 | % |
|
| 12.3 | % |
|
|
|
|
| ||||
| Adjusted EBITDA | $ | 641 |
|
| $ | 448 |
|
| Adjusted EBITDA margin |
| 67.8 | % |
|
| 66.1 | % |
| HILTON WORLDWIDE HOLDINGS INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES LONG-TERM DEBT TO NET INCOME RATIO AND NET DEBT AND NET DEBT TO ADJUSTED EBITDA RATIO (dollars in millions) (unaudited) | |||||||
|
| March 31, |
| December 31, | ||||
|
| 2023 |
| 2022 | ||||
| Long-term debt, including current maturities | $ | 8,741 |
|
| $ | 8,747 |
|
| Add: unamortized deferred financing costs and discount |
| 70 |
|
|
| 73 |
|
| Long-term debt, including current maturities and excluding the deduction for unamortized deferred financing costs and discount |
| 8,811 |
|
|
| 8,820 |
|
| Less: cash and cash equivalents |
| (901 | ) |
|
| (1,209 | ) |
| Less: restricted cash and cash equivalents |
| (77 | ) |
|
| (77 | ) |
| Net debt | $ | 7,833 |
|
| $ | 7,534 |
|
|
|
|
|
| ||||
|
| Three Months Ended |
| Year Ended |
| TTM Ended | ||||||||||
|
| March 31, |
| December 31, |
| March 31, | ||||||||||
|
| 2023 |
| 2022 |
| 2022 |
| 2023 | ||||||||
| Net income | $ | 209 |
| $ | 211 |
|
| $ | 1,257 |
|
| $ | 1,255 |
| |
| Interest expense |
| 116 |
|
| 90 |
|
|
| 415 |
|
|
| 441 |
| |
| Income tax expense |
| 93 |
|
| 80 |
|
|
| 477 |
|
|
| 490 |
| |
| Depreciation and amortization expenses |
| 37 |
|
| 44 |
|
|
| 162 |
|
|
| 155 |
| |
| EBITDA |
| 455 |
|
| 425 |
|
|
| 2,311 |
|
|
| 2,341 |
| |
| Loss (gain) on foreign currency transactions |
| — |
|
| 4 |
|
|
| (5 | ) |
|
| (9 | ) | |
| Loss on investments in unconsolidated affiliate(1) |
| 92 |
|
| — |
|
|
| — |
|
|
| 92 |
| |
| FF&E replacement reserves |
| 8 |
|
| 12 |
|
|
| 54 |
|
|
| 50 |
| |
| Share-based compensation expense |
| 33 |
|
| 37 |
|
|
| 162 |
|
|
| 158 |
| |
| Amortization of contract acquisition costs |
| 10 |
|
| 8 |
|
|
| 38 |
|
|
| 40 |
| |
| Net other expenses (revenues) from managed and franchised properties |
| 38 |
|
| (30 | ) |
|
| 39 |
|
|
| 107 |
| |
| Other adjustments(2) |
| 5 |
|
| (8 | ) |
|
| — |
|
|
| 13 |
| |
| Adjusted EBITDA | $ | 641 |
| $ | 448 |
|
| $ | 2,599 |
|
| $ | 2,792 |
| |
|
|
|
|
|
|
|
|
| ||||||||
| Long-term debt |
|
|
|
|
|
| $ | 8,741 |
| ||||||
| Long-term debt to net income ratio |
|
|
|
|
|
|
| 7.0 |
| ||||||
|
|
|
|
|
|
|
|
| ||||||||
| Net debt |
|
|
|
|
|
| $ | 7,833 |
| ||||||
| Net debt to Adjusted EBITDA ratio |
|
|
|
|
|
|
| 2.8 |
| ||||||
| ____________ | |
| (1) | Amount for the three months ended March 31, 2023 includes losses recognized related to equity and debt financing that Hilton had previously provided to an unconsolidated affiliate with underlying investments in hotels that Hilton currently or in the future will manage or franchise. |
| (2) | All periods include net losses (gains) related to certain of Hilton's investments in unconsolidated affiliates, other than the loss included separately in "loss on investments in unconsolidated affiliate," severance and other items. |
| HILTON WORLDWIDE HOLDINGS INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES OUTLOOK: NET INCOME AND DILUTED EPS, ADJUSTED FOR SPECIAL ITEMS (in millions, except per share data) (unaudited) | |||||||
|
| Three Months Ending | ||||||
|
| June 30, 2023 | ||||||
|
| Low Case |
| High Case | ||||
| Net income attributable to Hilton stockholders | $ | 386 |
|
| $ | 400 |
|
| Diluted EPS(1) | $ | 1.45 |
|
| $ | 1.50 |
|
| Special items(2): |
|
|
| ||||
| Purchase accounting amortization | $ | 11 |
|
| $ | 11 |
|
| FF&E replacement reserves |
| 19 |
|
|
| 19 |
|
| Total special items before taxes |
| 30 |
|
|
| 30 |
|
| Income tax expense on special items |
| (5 | ) |
|
| (5 | ) |
| Total special items after taxes | $ | 25 |
|
| $ | 25 |
|
|
|
|
|
| ||||
| Net income, adjusted for special items | $ | 411 |
|
| $ | 425 |
|
| Diluted EPS, adjusted for special items(1) | $ | 1.54 |
|
| $ | 1.59 |
|
|
| Year Ending | ||||||
|
| December 31, 2023 | ||||||
|
| Low Case |
| High Case | ||||
| Net income attributable to Hilton stockholders | $ | 1,324 |
|
| $ | 1,378 |
|
| Diluted EPS(1) | $ | 4.95 |
|
| $ | 5.14 |
|
| Special items(2): |
|
|
| ||||
| Net other expenses from managed and franchised properties | $ | 38 |
|
| $ | 38 |
|
| Purchase accounting amortization |
| 38 |
|
|
| 38 |
|
| Loss on investments in unconsolidated affiliate(3) |
| 92 |
|
|
| 92 |
|
| FF&E replacement reserves |
| 67 |
|
|
| 67 |
|
| Other adjustments |
| 4 |
|
|
| 4 |
|
| Total special items before taxes |
| 239 |
|
|
| 239 |
|
| Income tax expense on special items |
| (41 | ) |
|
| (41 | ) |
| Total special items after taxes | $ | 198 |
|
| $ | 198 |
|
|
|
|
|
| ||||
| Net income, adjusted for special items | $ | 1,522 |
|
| $ | 1,576 |
|
| Diluted EPS, adjusted for special items(1) | $ | 5.68 |
|
| $ | 5.88 |
|
| ____________ | |
| (1) | Does not include the effect of potential share repurchases. |
| (2) | See "—Net Income and Diluted EPS, Adjusted for Special Items" for details of these special items. |
| (3) | Includes losses recognized during the three months ended March 31, 2023 related to equity and debt financing that Hilton had previously provided to an unconsolidated affiliate with underlying investments in hotels that Hilton currently or in the future will manage or franchise. |
| HILTON WORLDWIDE HOLDINGS INC. RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES OUTLOOK: ADJUSTED EBITDA (in millions) (unaudited) | |||||||
|
| Three Months Ending | ||||||
|
| June 30, 2023 | ||||||
|
| Low Case |
| High Case | ||||
| Net income | $ | 387 |
| $ | 401 | ||
| Interest expense |
| 108 |
|
| 108 | ||
| Income tax expense |
| 155 |
|
| 161 | ||
| Depreciation and amortization expenses |
| 37 |
|
| 37 | ||
| EBITDA |
| 687 |
|
| 707 | ||
| FF&E replacement reserves |
| 19 |
|
| 19 | ||
| Share-based compensation expense |
| 50 |
|
| 50 | ||
| Amortization of contract acquisition costs |
| 11 |
|
| 11 | ||
| Other adjustments(1) |
| 3 |
|
| 3 | ||
| Adjusted EBITDA | $ | 770 |
| $ | 790 | ||
|
| Year Ending | ||||||
|
| December 31, 2023 | ||||||
|
| Low Case |
| High Case | ||||
| Net income | $ | 1,331 |
| $ | 1,385 | ||
| Interest expense |
| 444 |
|
| 444 | ||
| Income tax expense |
| 541 |
|
| 562 | ||
| Depreciation and amortization expenses |
| 147 |
|
| 147 | ||
| EBITDA |
| 2,463 |
|
| 2,538 | ||
| Loss on investments in unconsolidated affiliate(2) |
| 92 |
|
| 92 | ||
| FF&E replacement reserves |
| 67 |
|
| 67 | ||
| Share-based compensation expense |
| 158 |
|
| 158 | ||
| Amortization of contract acquisition costs |
| 43 |
|
| 43 | ||
| Net other expenses from managed and franchised properties |
| 38 |
|
| 38 | ||
| Other adjustments(1) |
| 14 |
|
| 14 | ||
| Adjusted EBITDA | $ | 2,875 |
| $ | 2,950 | ||
| ____________ | |
| (1) | Includes adjustments for severance and other items. See "—Net Income Margin and Adjusted EBITDA and Adjusted EBITDA Margin" for details of these adjustments. |
| (2) | Includes losses recognized during the three months ended March 31, 2023 related to equity and debt financing that Hilton had previously provided to an unconsolidated affiliate with underlying investments in hotels that Hilton currently or in the future will manage or franchise. |