Hilton Reports Fourth Quarter and Full Year Results
Hilton reported significant impacts from the COVID-19 pandemic, revealing a diluted EPS of $(0.80) in Q4 and $(2.56) for 2020. The company faced a net loss of $225 million for Q4 and $720 million for the full year. Adjusted EBITDA stood at $204 million and $842 million for the respective periods. Comparable RevPAR dropped 59.2% in Q4 and 56.7% for the year. Despite challenges, Hilton opened 22,900 rooms in Q4, achieving 5.1% net unit growth. As of February 2021, 97% of its hotels were operational. Hilton's long-term debt was $10.6 billion, with significant liquidity maintained.
- Opened 22,900 rooms in Q4 2020, achieving net unit growth of 5.1% for the year.
- Development pipeline totals approximately 397,000 rooms, indicating strong future growth potential.
- 97% of Hilton's system-wide hotels were operational as of February 2021.
- Reported diluted EPS of $(0.80) for Q4 2020 and $(2.56) for the full year.
- Net loss of $225 million in Q4 and $720 million for the year due to COVID-19 impacts.
- Comparable RevPAR decreased by 59.2% in Q4 and 56.7% for the full year 2020.
Hilton Worldwide Holdings Inc. ("Hilton" or the "Company") (NYSE: HLT) today reported its fourth quarter and full year 2020 results. The following results reflect the material impact that the novel coronavirus ("COVID-19") pandemic has had on Hilton's business. Highlights include:
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Diluted EPS was
$(0.80) for the fourth quarter and$(2.56) for the full year, and diluted EPS, adjusted for special items, was$(0.10) for the fourth quarter and$0.10 for the full year
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Net loss was
$225 million for the fourth quarter and$720 million for the full year
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Adjusted EBITDA was
$204 million for the fourth quarter and$842 million for the full year
- System-wide comparable RevPAR decreased 59.2 percent and 56.7 percent on a currency neutral basis for the fourth quarter and full year, respectively, from the same periods in 2019
- Approved 18,700 new rooms for development during the fourth quarter, bringing Hilton's development pipeline to 397,000 rooms as of December 31, 2020
- Opened 22,900 rooms in the fourth quarter, reaching the one million room milestone and contributing to 47,400 net additional rooms in Hilton's system for the full year, which represented approximately 5.1 percent net unit growth from December 31, 2019
- As of February 10, 2021, 97 percent of Hilton's system-wide hotels were open
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In December 2020, issued
$1.9 billion of senior notes consisting of: (i)$800 million aggregate principal amount of3.750% Senior Notes due 2029 and (ii)$1.1 billion aggregate principal amount of4.000% Senior Notes due 2031; and used the net proceeds to redeem: (i)$1.0 billion in aggregate principal amount of outstanding4.250% Senior Notes due 2024 and (ii)$900 million in aggregate principal amount of outstanding4.625% Senior Notes due 2025
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In January 2021, repaid
$250 million of the outstanding debt balance under the$1.75 billion senior secured revolving credit facility
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In February 2021, issued
$1.5 billion aggregate principal amount of3.625% Senior Notes due 2032 and used the net proceeds to redeem$1.5 billion in aggregate principal amount of outstanding5.125% Senior Notes due 2026
Overview
Christopher J. Nassetta, President & Chief Executive Officer of Hilton, said, "Our fourth quarter results were largely in line with our expectations as rising COVID-19 cases and tightening travel restrictions disrupted the positive momentum we saw throughout the summer and fall. Yet even with a challenging environment, we celebrated our one million room milestone during the quarter and achieved net unit growth of more than five percent for the year. We continued this momentum into 2021 with the opening of our 900th Hilton Garden Inn and the conversion of Oceana Santa Monica, which marked the U.S. debut of LXR. We expect our industry-leading brands to continue driving new development and conversion opportunities, enabling us to further grow our network and capture a disproportionate share of demand as travel resumes."
On a global level, the pervasive impact of the COVID-19 pandemic began in late March, with its most significant adverse impact on occupancy and RevPAR in April. System-wide occupancy showed sequential month-over-month improvement from April through October and, in the fourth quarter, there was both occupancy and RevPAR improvement in the Americas (excluding U.S.), Middle East and Africa and Asia Pacific regions. However, travel restrictions re-imposed in late 2020 resulted in additional temporary suspensions and, in some cases, re-suspensions of hotel operations, particularly in Europe, which led to further declines in occupancy and RevPAR in that region in the fourth quarter.
For the three months and year ended December 31, 2020, system-wide comparable RevPAR decreased 59.2 percent and 56.7 percent, respectively, compared to the same periods in 2019, due to both occupancy and ADR decreases. Additionally, fee revenues decreased 50 percent and 51 percent during the three months and year ended December 31, 2020, respectively, compared to the same periods in 2019. The decreases were due to the COVID-19 pandemic, which resulted in the complete or partial suspensions of hotel operations at approximately 20 percent of Hilton's global hotel properties for some portion of the year ended December 31, 2020. As of February 10, 2021, 97 percent of Hilton's global hotel properties were open, while approximately 220 hotels had temporarily suspended operations.
For the three months ended December 31, 2020, diluted EPS was
For the year ended December 31, 2020, diluted EPS was
Development
In the fourth quarter of 2020, Hilton opened 154 new hotels totaling 22,900 rooms, and achieved net unit growth of 20,900 rooms. During the full year 2020, Hilton opened 414 new hotels totaling 55,600 rooms and achieved net unit growth of 47,400 rooms. Hilton opened the Waldorf Astoria Xiamen, Hilton's 300th hotel in China, in December 2020, and continued to add to its luxury portfolio in 2021 with the opening of the Waldorf Astoria Monarch Beach Resort & Club.
As of December 31, 2020, Hilton's development pipeline totaled nearly 2,570 hotels consisting of more than 397,000 rooms throughout 116 countries and territories, including 31 countries and territories where Hilton does not currently have any open hotels. Additionally, of the rooms in the development pipeline, 233,000 rooms were located outside the U.S., and 204,000 rooms were under construction.
Balance Sheet and Liquidity
As of December 31, 2020, Hilton had
In January 2021, Hilton repaid
In March 2020, Hilton suspended share repurchases and the payment of dividends to preserve capital and maintain liquidity. No share repurchases have been made since March 5, 2020, and no dividends have been declared or paid since March 31, 2020. The stock repurchase program remains authorized by the board of directors, and the amount remaining under Hilton's stock repurchase program is approximately
Conference Call
Hilton will host a conference call to discuss fourth quarter and full year 2020 results on February 17, 2021 at 10:00 a.m. Eastern Time. Participants may listen to the live webcast by logging on to the Hilton Investor Relations website at https://ir.hilton.com/events-and-presentations. A replay and transcript of the webcast will be available within 24 hours after the live event at https://ir.hilton.com/financial-reporting/quarterly-results/2020.
Alternatively, participants may listen to the live call by dialing 1-888-317-6003 in the United States ("U.S.") or 1-412-317-6061 internationally using the conference ID 1737754. Participants are encouraged to dial into the call or link to the webcast at least fifteen minutes prior to the scheduled start time. A telephone replay will be available for seven days following the call. To access the telephone replay, dial 1-877-344-7529 in the U.S. or 1-412-317-0088 internationally using the conference ID 10151277.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited to, statements related to the expectations regarding the impact of the COVID-19 pandemic, the performance of Hilton's business, financial results, liquidity and capital resources and other non-historical statements. In some cases, these forward-looking statements can be identified by the use of words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "could," "seeks," "projects," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties, including, among others, risks related to the impact of the COVID-19 pandemic, risks inherent to the hospitality industry, macroeconomic factors beyond Hilton's control, competition for hotel guests and management and franchise contracts, risks related to doing business with third-party hotel owners, performance of Hilton's information technology systems, growth of reservation channels outside of Hilton's system, risks of doing business outside of the U.S. and Hilton's indebtedness. Additional factors that could cause Hilton's results to differ materially from those described in the forward-looking statements can be found under the sections entitled "Part I—Item 1A. Risk Factors" of Hilton's Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and "Part II—Item 1A. Risk Factors" of Hilton's Quarterly Report on Form 10-Q for the quarter ended September 30, 2020, filed with the Securities and Exchange Commission (the "SEC"), as such factors may be further updated from time to time in Hilton's periodic filings with the SEC, including Hilton's Annual Report on Form 10-K for the fiscal year ended December 31, 2020, which is expected to be filed on or about the date of this press release, which are accessible on the SEC's website at www.sec.gov. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this press release and in Hilton's filings with the SEC. The Company undertakes no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.
Non-GAAP Financial Measures
The Company refers to certain financial measures that are not recognized under U.S. generally accepted accounting principles ("GAAP") in this press release, including: net income (loss), adjusted for special items; diluted EPS, adjusted for special items; Adjusted EBITDA; Adjusted EBITDA margin; net debt; and net debt to Adjusted EBITDA ratio. See the schedules to this press release, including the "Definitions" section, for additional information and reconciliations of such non-GAAP financial measures.
About Hilton
Hilton (NYSE: HLT) is a leading global hospitality company with a portfolio of 18 world-class brands comprising more than 6,400 properties and more than one million rooms in 119 countries and territories. Dedicated to fulfilling its founding vision to fill the earth with the light and warmth of hospitality, Hilton has welcomed more than 3 billion guests in its more than 100-year history, earned a top spot on the 2020 World's Best Workplaces list and was named the 2020 Global Industry Leader on the Dow Jones Sustainability Indices. In 2020, Hilton CleanStay was introduced, bringing an industry-defining standard of cleanliness and disinfection to hotels worldwide. Through the award-winning guest loyalty program Hilton Honors, the more than 112 million members who book directly with Hilton can earn Points for hotel stays and experiences money can't buy, plus enjoy instant benefits, including contactless check-in with room selection, Digital Key and Connected Room. Visit newsroom.hilton.com for more information, and connect with Hilton on facebook.com/hiltonnewsroom, twitter.com/hiltonnewsroom, linkedin.com/company/hilton, instagram.com/hiltonnewsroom and youtube.com/hiltonnewsroom.
HILTON WORLDWIDE HOLDINGS INC. EARNINGS RELEASE SCHEDULES TABLE OF CONTENTS |
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Consolidated Statements of Operations |
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Comparable and Currency Neutral System-Wide Hotel Operating Statistics |
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Property Summary |
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Capital Expenditures and Contract Acquisition Costs |
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Reconciliations of Non-GAAP Financial Measures |
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Definitions |
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HILTON WORLDWIDE HOLDINGS INC. CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited, in millions, except per share data) |
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Three Months Ended |
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Year Ended |
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December 31, |
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December 31, |
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2020 |
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2019 |
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2020 |
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2019 |
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Revenues |
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Franchise and licensing fees |
$ |
233 |
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412 |
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945 |
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$ |
1,681 |
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Base and other management fees |
31 |
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FAQ
What were Hilton's diluted EPS figures for Q4 and full year 2020?
Hilton reported a diluted EPS of $(0.80) for Q4 2020 and $(2.56) for the full year.
How much was Hilton's net loss for Q4 and full year 2020?
Hilton faced a net loss of $225 million for Q4 and $720 million for the full year.
What was the change in Hilton's comparable RevPAR for Q4 and full year 2020?
Comparable RevPAR decreased by 59.2% in Q4 and 56.7% for the full year 2020.
How many rooms did Hilton open in Q4 2020?
Hilton opened 22,900 rooms in Q4 2020.
What percentage of Hilton's hotels were open as of February 2021?
As of February 2021, 97% of Hilton's system-wide hotels were open.
Hilton Worldwide Holdings Inc.
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