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Graduate by Hilton PrincetonHilton Worldwide Holdings Inc. (“Hilton,” “the Company,” “we,” “us” or “our”) (NYSE: HLT) today reported its third quarter 2024 results. Highlights include:

  • Diluted EPS was $1.38 for the third quarter, and diluted EPS, adjusted for special items, was $1.92
  • Net income was $344 million for the third quarter
  • Adjusted EBITDA was $904 million for the third quarter
  • System-wide comparable RevPAR increased 1.4 percent, on a currency neutral basis, for the third quarter compared to the same period in 2023
  • Approved 27,500 new rooms for development during the third quarter, bringing our development pipeline to

492,400 rooms as of September 30, 2024, representing growth of 8 percent from September 30, 2023

  • Added a record 36,600 rooms to our system in the third quarter, resulting in 33,600 net additional rooms for the third quarter, contributing to a record net unit growth of 7.8 percent from September 30, 2023
  • Repurchased 3.3 million shares of Hilton common stock during the third quarter; bringing total capital return, including dividends, to $764 million for the quarter and $2,422 million year to date through October
  • Issued $1.0 billion aggregate principal amount of 5.875% Senior Notes due 2033 in September 2024
  • Full year 2024 system-wide RevPAR is projected to increase between 2.0 percent and 2.5 percent on a comparable and currency neutral basis compared to 2023; full year net income is projected to be between $1,405 million and $1,429 million; full year Adjusted EBITDA is projected to be between $3,375 million and $3,405 million
  • Full year 2024 capital return is projected to be approximately $3.0 billion
  • Net unit growth for 2025 is expected to be between 6.0 percent and 7.0 percent

Christopher J. Nassetta, President & Chief Executive Officer of Hilton, said, “We were pleased to deliver continued strong bottom line results that exceeded our guidance, despite slower top line growth which was driven by modestly slower macro trends, weather impacts and unfavorable calendar shifts. We continued to demonstrate the strength of our model, opening more rooms than any other quarter in our history, surpassing 8,000 hotels and achieving net unit growth of 7.8 percent.”

For the three months ended September 30, 2024, system-wide comparable RevPAR increased 1.4 percent compared to the same period in 2023 due to increases in both occupancy and ADR, and management and franchise fee revenues increased 8.3 percent compared to the same period in 2023.

For the nine months ended September 30, 2024, system-wide comparable RevPAR increased 2.4 percent compared to the same period in 2023 due to increases in both occupancy and ADR, and management and franchise fee revenues increased 10.7 percent compared to the same period in 2023.

For the three months ended September 30, 2024, diluted EPS was $1.38 and diluted EPS, adjusted for special items, was $1.92 compared to $1.44 and $1.67, respectively, for the three months ended September 30, 2023. Net income and Adjusted EBITDA were $344 million and $904 million, respectively, for the three months ended September 30, 2024, compared to $379 million and $834 million, respectively, for the three months ended September 30, 2023.

For the nine months ended September 30, 2024, diluted EPS was $4.09 and diluted EPS, adjusted for special items, was $5.36 compared to $3.74 and $4.53, respectively, for the nine months ended September 30, 2023. Net income and Adjusted EBITDA were $1,034 million and $2,571 million, respectively, for the nine months ended September 30, 2024, compared to $1,001 million and $2,286 million, respectively, for the nine months ended September 30, 2023.

Development

In the third quarter of 2024, we opened 531 hotels, totaling 36,600 rooms, resulting in 33,600 net room additions.[1] During the quarter, NoMad, Graduate by Hilton and Small Luxury Hotels of the World (“SLH”) became available for reservations on our booking channels. The addition of SLH hotels brings our hotel portfolio to ten additional countries and territories, allowing our guests to book, earn and redeem Honors points in more sought after destinations. We continued to expand our portfolio in the Asia Pacific market, surpassing 900 hotels in the region and opening our 700th hotel in China. Additionally, our Spark by Hilton brand continues to grow, with more than 20 hotels opening during the third quarter, including the debut of the first Spark hotel in Canada.

We added 27,500 rooms to the development pipeline during the third quarter, and, as of September 30, 2024, our development pipeline totaled 3,525 hotels representing 492,400 rooms throughout 120 countries and territories, including 28 countries and territories where Hilton had no existing hotels.[2] Additionally, of the rooms in the development pipeline, 235,400 were under construction and 280,700 were located outside of the U.S.

Balance Sheet and Liquidity

As of September 30, 2024, we had $11.3 billion of debt outstanding, excluding the deduction for deferred financing costs and discounts, with a weighted average interest rate of 4.84 percent. Excluding all finance lease liabilities and other debt of our consolidated variable interest entities, we had $11.1 billion of debt outstanding with a weighted average interest rate of 4.83 percent and no scheduled maturities until 2027, other than $500 million of outstanding Senior Notes due May 2025. We believe that we have sufficient sources of liquidity and access to debt financing to address the Senior Notes due May 2025 at or prior to their maturity date. As of September 30, 2024, no debt amounts were outstanding under our $2.0 billion senior secured revolving credit facility (the “Revolving Credit Facility”), which had an available borrowing capacity of $1,913 million after considering $87 million of outstanding letters of credit. Total cash and cash equivalents were $1,655 million as of September 30, 2024, including $75 million of restricted cash and cash equivalents.

In September 2024, we issued $1 billion aggregate principal amount of 5.875% Senior Notes due 2033. We intend to use the net proceeds from the issuance for general corporate purposes.

In September 2024, we paid a quarterly cash dividend of $0.15 per share of common stock, for a total of $37 million, bringing total dividend payments for the year to $113 million. In October 2024, our board of directors authorized a regular quarterly cash dividend of $0.15 per share of common stock to be paid on December 27, 2024 to holders of record of our common stock as of the close of business on November 15, 2024.

During the three months ended September 30, 2024, we repurchased 3.3 million shares of Hilton common stock at an average price per share of $217.15, for a total of $727 million. For the nine months ended September 30, 2024, we repurchased 10.2 million shares of Hilton common stock at an average price per share of $206.29, returning $2,226 million of capital to shareholders, including dividends. Total capital return to shareholders including dividends year-to-date through October was $2,422 million.

The number of shares outstanding as of October 18, 2024 was 243.8 million.

Outlook

Share-based metrics in Hilton’s outlook include actual share repurchases through the third quarter but do not include the effect of potential share repurchases thereafter.

Full Year 2024

  • System-wide comparable RevPAR, on a currency neutral basis, is projected to increase between 2.0 percent and 2.5 percent compared to 2023.
  • Diluted EPS is projected to be between $5.58 and $5.68.
  • Diluted EPS, adjusted for special items, is projected to be between $6.93 and $7.03.
  • Net income is projected to be between $1,405 million and $1,429 million.
  • Adjusted EBITDA is projected to be between $3,375 million and $3,405 million.
  • Contract acquisition costs and capital expenditures, excluding amounts reimbursed by third parties, are projected to be between $200 million and $250 million.
  • Capital return is projected to be approximately $3.0 billion.
  • General and administrative expenses are projected to be between $415 million and $430 million.
  • Net unit growth is projected to be between 7.0 percent and 7.5 percent.

Fourth Quarter 2024

  • System-wide comparable RevPAR, on a currency neutral basis, is projected to increase between 1.0 percent and 2.0 percent compared to the fourth quarter of 2023.
  • Diluted EPS is projected to be between $1.49 and $1.59.
  • Diluted EPS, adjusted for special items, is projected to be between $1.57 and $1.67.
  • Net income is projected to be between $371 million and $395 million.
  • Adjusted EBITDA is projected to be between $804 million and $834 million. Conference Call

Hilton will host a conference call to discuss third quarter of 2024 results on October 23, 2024 at 9:00 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/eventsand-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.

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 6226859. 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 6850988.

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 our expectations regarding the performance of our business, future financial results, liquidity and capital resources and other non-historical statements. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believes,” “expects,” “forecasts,” “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 inherent to the hospitality industry; macroeconomic factors beyond our control, such as inflation, changes in interest rates, challenges due to labor shortages or disputes and supply chain disruptions; the loss of key senior management personnel; competition for hotel guests and management and franchise contracts; risks related to doing business with third-party hotel owners; performance of our information technology systems; growth of reservation channels outside of our system; risks of doing business outside of the U.S.; risks associated with conflicts in Eastern Europe and the Middle East and other geopolitical events; and our indebtedness. Additional factors that could cause our results to differ materially from those described in the forward-looking statements can be found under the section entitled “Part I—Item 1A. Risk Factors” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, which is filed with the Securities and Exchange Commission (the “SEC”) and is 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 our filings with the SEC. We undertake 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. Definitions

See the “Definitions” section for the definition of certain terms used within this press release, including within the schedules.

Non-GAAP Financial Measures

We refer to certain financial measures that are not recognized under U.S. generally accepted accounting principles (“GAAP”) in this press release, including: net income, adjusted for special items; diluted EPS, adjusted for special items; EBITDA; 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, as well as the most comparable GAAP financial measures.

[1] Excluding hotels from our strategic partner arrangements, we added 18,300 rooms to our system during the third quarter, and, as of September 30, 2024, our hotel system would have totaled 7,800 hotels representing 1,213,800 rooms, growing 6.1% from September 30, 2023 and 1.3% from the prior quarter.

[2] Excluding hotels from our strategic partner arrangements, we added 26,400 rooms to the development pipeline during the third quarter, and, as of September 30, 2024, our development pipeline would have totaled 3,514 hotels and 491,900 rooms, representing 8% growth from September 30, 2023 and consistent with total development pipeline rooms excluding hotels from our strategic partner arrangements as of June 30, 2024.