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Hilton Worldwide Holdings Inc. today reported its
third quarter 2019 results. Highlights include:
• Diluted EPS was $1.00 for the third quarter, an 85 percent increase from the same period in 2018, and diluted
EPS, adjusted for special items, was $1.05, a 13 percent increase from the same period in 2018
• Net income for the third quarter was $290 million, a 77 percent increase from the same period in 2018
• Adjusted EBITDA for the third quarter was $605 million, a 9 percent increase from the same period in 2018
• System-wide comparable RevPAR increased 0.4 percent on a currency neutral basis for the third quarter from
the same period in 2018
• Approved 25,200 new rooms for development during the third quarter, growing Hilton’s development pipeline
to 379,000 rooms as of September 30, 2019
• Opened 17,400 rooms in the third quarter, contributing to 15,600 net additional rooms, on track to deliver
approximately 6.5 percent net unit growth for the full year
• Repurchased 4.5 million shares of Hilton common stock during the third quarter, bringing total capital return,
including dividends, to approximately $465 million for the quarter and $1.2 billion year to date through
September
• Full year 2019 system-wide comparable RevPAR is expected to increase approximately 1.0 percent on a
currency neutral basis compared to 2018; full year net income is projected to be between $923 million and $937
million; full year Adjusted EBITDA is projected to be between $2,285 million and $2,305 million
• Full year 2019 capital return is projected to be between $1.6 billion and $1.8 billion
• For full year 2020, system-wide comparable RevPAR is expected to be flat to 1.0 percent growth on a currency
neutral basis compared to 2019; net unit growth is expected to be 6.0 percent to 7.0 percent
Christopher J. Nassetta, President & Chief Executive Officer of Hilton, said, “Despite the overall slowing macro environment, we
are pleased to deliver strong bottom-line results for the third quarter. Adjusted EBITDA was towards the high end of guidance and
diluted EPS, adjusted for special items, exceeded our expectations, driven by strong net unit growth. Additionally, we continue to
achieve market share gains across all brands and regions year to date.”
For the three months ended September 30, 2019, system-wide comparable RevPAR grew 0.4 percent driven by increased
occupancy. For the nine months ended September 30, 2019, system-wide comparable RevPAR grew 1.2 percent driven by
increases in both ADR and occupancy. Management and franchise fee revenues increased 6 percent during the three months
ended September 30, 2019 due to RevPAR growth of 0.3 percent at comparable managed and franchised hotels. During the
nine months ended September 30, 2019, management and franchise fee revenues increased 8 percent as a result of RevPAR
growth at comparable managed and franchised hotels of 1.2 percent. Additionally, management and franchise fee revenues
increased due to increased licensing and other fees and the addition of new properties to Hilton’s portfolio.
For the three months ended September 30, 2019, diluted EPS was $1.00 and diluted EPS, adjusted for special items, was $1.05
compared to $0.54 and $0.93, respectively, for the three months ended September 30, 2018. Net income and Adjusted EBITDA
were $290 million and $605 million, respectively, for the three months ended September 30, 2019, compared to $164 million and
$557 million, respectively, for the three months ended September 30, 2018. During the three months ended September 30, 2019,
the Company completed the sale of the Hilton Odawara Resort & Spa and subsequently entered into a 30-year management
contract with the purchaser of the hotel. As a result of the sale, the Company recognized a pre-tax gain of $81 million.
For the nine months ended September 30, 2019, diluted EPS was $2.42 and diluted EPS, adjusted for special items, was $2.90
compared to $1.76 and $2.48, respectively, for the nine months ended September 30, 2018. Net income and Adjusted EBITDA
were $710 million and $1,722 million, respectively, for the nine months ended September 30, 2019, compared to $544 million
and $1,557 million, respectively, for the nine months ended September 30, 2018.
Development
In the third quarter of 2019, Hilton opened 118 new hotels totaling approximately 17,400 rooms and achieved net unit growth of
15,600 rooms, contributing to 7 percent net unit growth from September 30, 2018.
As of September 30, 2019, Hilton’s development pipeline totaled more than 2,530 hotels consisting of nearly 379,000 rooms
throughout 111 countries and territories, including 35 countries and territories where Hilton does not currently have any open
hotels. Additionally, of the rooms in the development pipeline, 205,000 rooms were located outside the U.S., and 198,000 rooms,
or more than half, were under construction.
Hilton remains on track to grow its luxury portfolio by 17 percent in 2019, with the re-branding of the Conrad New York Midtown
and openings in the third quarter of the Conrad Tianjin, the Conrad Shenyang, the Waldorf Astoria Los Cabos Pedregal and the
Biltmore Mayfair, LXR.
Balance Sheet and Liquidity
As of September 30, 2019, Hilton had $7.9 billion of long-term debt outstanding, excluding deferred financing costs and discount,
with a weighted average interest rate of 4.47 percent. Excluding finance lease liabilities and other debt of Hilton’s consolidated
variable interest entities, Hilton had $7.6 billion of long-term debt outstanding with a weighted average interest rate of 4.42
percent.
Total cash and cash equivalents were $809 million as of September 30, 2019, including $90 million of restricted cash and cash
equivalents. No amounts were outstanding under the $1.75 billion senior secured revolving credit facility as of September 30,
2019.
During the third quarter of 2019, Hilton repurchased 4.5 million shares of its common stock at a cost of approximately $422
million and an average price per share of $94.72. During the nine months ended September 30, 2019, Hilton repurchased 12.5
million shares of its common stock at a cost of approximately $1.1 billion and an average price per share of $88.11. Since the
inception of Hilton’s stock repurchase program in March 2017, Hilton has repurchased approximately 50.7 million shares of its
common stock for approximately $3.8 billion at an average price per share of $75.28. The amount remaining under Hilton’s
current stock repurchase program is approximately $853 million.
In September 2019, Hilton paid a quarterly cash dividend of $0.15 per share on shares of its common stock, for a total of $43
million, bringing year to date dividends to $130 million. In October 2019, 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 December 27, 2019 to holders of record of its
common stock as of the close of business on November 8, 2019.
Pictured : Chris Nassetta
Source : Company