Investor Contact 7930 Jones Branch Drive
Jill Slattery Chapman McLean, VA 22102
+1 703 883 5476 ir.hilton.com
Media Contact
Kent Landers
+1 703 883 3246
Hilton Reports Fourth Quarter and Full Year Results
MCLEAN, VA (February 9, 2023) - Hilton Worldwide Holdings Inc. ("Hilton" or the "Company") (NYSE: HLT) today reported its
fourth quarter and full year 2022 results. Highlights include:
• Diluted EPS was $1.21 for the fourth quarter and $4.53 for the full year, exceeding the high end of guidance
• Diluted EPS, adjusted for special items, was $1.59 for the fourth quarter and $4.89 for the full year, exceeding
the high end of guidance
• Net income was $333 million for the fourth quarter and $1,257 million for the full year, exceeding the high end
of guidance
• Adjusted EBITDA was $740 million for the fourth quarter and $2,599 million for the full year, exceeding the high
end of guidance
• System-wide comparable RevPAR increased 24.8 percent and 42.5 percent, on a currency neutral basis, for the
fourth quarter and full year, respectively, compared to the same periods in 2021
• System-wide comparable RevPAR increased 7.5 percent and decreased 1.3 percent, on a currency neutral
basis, for the fourth quarter and full year, respectively, compared to the same periods in 2019
• Approved 24,400 new rooms for development during the fourth quarter, bringing Hilton's development pipeline
to 416,400 rooms as of December 31, 2022
• Added 17,700 rooms to Hilton's system in the fourth quarter, resulting in 48,300 net additional rooms in Hilton's
system for the full year, contributing to net unit growth of 4.7 percent, with fourth quarter hotel openings
modestly lagging prior expectations due to the ongoing COVID-19 environment in China
• Full year 2023 net unit growth is expected to be between 5.0 percent and 5.5 percent
• Repurchased 3.8 million shares of Hilton common stock during the fourth quarter, bringing total capital return,
including dividends, to $542 million for the quarter and more than $1.7 billion for the full year
• Launched a new premium economy brand, Spark by Hilton, in January 2023
• Full year 2023 system-wide RevPAR is expected to increase between 4 percent and 8 percent on a comparable
and currency neutral basis compared to 2022; full year net income is projected to be between $1,382 million
and $1,454 million; full year Adjusted EBITDA is projected to be between $2,800 million and $2,900 million
• Full year 2023 capital return is projected to be between $1.7 billion and $2.1 billion
1
Overview
Christopher J. Nassetta, President & Chief Executive Officer of Hilton, said, "Our fourth quarter and full year results surpassed
our expectations, with fourth quarter system-wide RevPAR meaningfully exceeding the same period in 2019 driven by growth
across all segments. This marked the second consecutive quarter that RevPAR exceeded pre-pandemic levels. Positive
momentum has continued into the new year with exciting growth opportunities ahead, including the continued expansion of our
brand portfolio with the recent launch of our newest brand, Spark by Hilton."
For the three months and year ended December 31, 2022, system-wide comparable RevPAR increased 24.8 percent and 42.5
percent, respectively, compared to the same periods in 2021, due to increases in both occupancy and ADR. For the three
months and year ended December 31, 2022 compared to the same periods in 2021, fee revenues increased 30 percent and 45
percent, respectively. For comparison to pre-pandemic results, system-wide comparable RevPAR for the three months and year
ended December 31, 2022 increased 7.5 percent and decreased 1.3 percent, respectively, compared to the same periods in
2019, and fee revenues for both the three months and year ended December 31, 2022 exceeded the same periods in 2019.
For the three months ended December 31, 2022, diluted EPS was $1.21 and diluted EPS, adjusted for special items, was $1.59
compared to $0.52 and $0.72, respectively, for the three months ended December 31, 2021. Net income and Adjusted EBITDA
were $333 million and $740 million, respectively, for the three months ended December 31, 2022, compared to $148 million and
$512 million, respectively, for the three months ended December 31, 2021.
For the year ended December 31, 2022, diluted EPS was $4.53 and diluted EPS, adjusted for special items, was $4.89
compared to $1.46 and $2.08, respectively, for the year ended December 31, 2021. Net income and Adjusted EBITDA were
$1,257 million and $2,599 million, respectively, for the year ended December 31, 2022, compared to $407 million and $1,629
million, respectively, for the year ended December 31, 2021.
Development
In the fourth quarter of 2022, Hilton opened 108 new hotels contributing 17,700 additional rooms to Hilton's system and achieved
net unit growth of 15,100 rooms. During the full year 2022, Hilton opened 355 new hotels totaling 58,200 rooms and achieved net
unit growth of 48,300 rooms. Hilton continued to achieve growth milestones during the fourth quarter, opening the 60,000th room
under the Home2 Suites by Hilton brand and the 150,000th room under the DoubleTree by Hilton brand. Further, during the
fourth quarter, Hilton opened the Waldorf Astoria Cancun, marking the Company's 200th hotel in the Caribbean and Latin
America region.
As of December 31, 2022, Hilton's development pipeline totaled more than 2,820 hotels representing 416,400 rooms throughout
118 countries and territories, including 30 countries and territories where Hilton does not currently have any existing hotels.
Additionally, of the rooms in the development pipeline, 205,400 of the rooms were under construction and 243,500 of the rooms
were located outside the U.S.
In January 2023, Hilton launched Spark by Hilton, a premium economy brand that is dedicated to delivering thoughtful simplicity,
reliable service, unexpected touches and consistent quality. Spark by Hilton leverages a conversion model approach to growth
and had more than 200 hotels in various stages of negotiation as of February 3, 2023.
Balance Sheet and Liquidity
As of December 31, 2022, 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 4.45 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 4.44 percent and no scheduled maturities until May 2025. No debt amounts were outstanding under Hilton's
$1.75 billion senior secured revolving credit facility (the "Revolving Credit Facility") as of December 31, 2022, which had an
available borrowing capacity of $1.69 billion after considering $60 million of outstanding letters of credit. Total cash and cash
equivalents were $1,286 million as of December 31, 2022, including $77 million of restricted cash and cash equivalents.
In January 2023, Hilton amended its credit agreement governing its Revolving Credit Facility to increase the borrowing capacity
to $2.0 billion, $250 million of which is available in the form of letters of credit, and, based on the terms of the agreement, Hilton
expects the extended maturity date to be January 2028. As of February 3, 2023, after considering the $60 million of letters of
credit outstanding and no borrowings outstanding, Hilton had an available borrowing capacity on the Revolving Credit Facility of
$1,940 million.
During the fourth quarter of 2022, Hilton repurchased 3.8 million shares of its common stock for a cost of $501 million and an
average price per share of $131.36. During the year ended December 31, 2022, Hilton repurchased 12.3 million shares of its
common stock for a cost of $1,608 million and an average price per share of $130.75. In November 2022, Hilton's board of
directors authorized an additional $2.5 billion for share repurchases under its share repurchase program. Through February 3,
2023, since the inception of Hilton's stock repurchase program in March 2017, Hilton has repurchased approximately 53.8 million
2
shares of its common stock for approximately $5.1 billion at an average price per share of $94.19. The amount remaining under
Hilton's stock repurchase program is approximately $2,933 million.
In December 2022, Hilton paid a quarterly cash dividend of $0.15 per share of common stock, for a total of $41 million, bringing
cash dividends for the full year to $123 million. In February 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 March 31, 2023 to holders of record of its common stock as
of the close of business on February 28, 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 4 percent and 8
percent compared to 2022.
• Diluted EPS is projected to be between $5.10 and $5.36.
• Diluted EPS, adjusted for special items, is projected to be between $5.42 and $5.68.
• Net income is projected to be between $1,382 million and $1,454 million.
• Adjusted EBITDA is projected to be between $2,800 million and $2,900 million.
• Contract acquisition costs and capital expenditures, excluding amounts indirectly reimbursed by third parties, are
expected to be approximately $300 million.
• Capital return is projected to be between $1.7 billion and $2.1 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.
First Quarter 2023
• System-wide comparable RevPAR, on a currency neutral basis, is expected to increase between 23 percent and 27
percent compared to the first quarter of 2022.
• Diluted EPS is projected to be between $1.00 and $1.06.
• Diluted EPS, adjusted for special items, is projected to be between $1.08 and $1.14.
• Net income is projected to be between $271 million and $287 million.
• Adjusted EBITDA is projected to be between $590 million and $610 million.
Conference Call
Hilton will host a conference call to discuss fourth quarter and full year 2022 results on February 9, 2023 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.
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 2954222. 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 9082885.
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 recovery of the travel and hospitality industry from the coronavirus
("COVID-19") pandemic (the "pandemic"), the performance of Hilton's business, future 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
3
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 inherent to the hospitality
industry, macroeconomic factors beyond Hilton's control, such as inflation, changes in interest rates and challenges due to labor
shortages and supply chain disruptions, risks related to the impact of the pandemic, including as a result of new strains or
variants of the virus and uncertainty of the acceptance and continued effectiveness of the COVID-19 vaccines, 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., risks associated with the Russian invasion of Ukraine 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, 2021 and
"Part II —Item 1A. Risk Factors" of Hilton's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022, both
of which are filed with the Securities and Exchange Commission (the "SEC") and are accessible on the SEC's website at
www.sec.gov. Such factors may be 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, 2022, which is expected to be filed with the SEC on or about the
date of this press release. 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.
Definitions
See the "Definitions" section for the definition of certain terms used within this press release, including within the schedules.
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;
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 measure.
About Hilton
Hilton (NYSE: HLT) is a leading global hospitality company with a portfolio of 19 world-class brands comprising more than 7,100
properties and more than 1.1 million rooms, in 123 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 Fortune's 100 Best Companies to Work For list and been recognized as a global leader on the Dow Jones
Sustainability Indices for six consecutive years. Hilton has introduced several industry-leading technology enhancements to
improve the guest experience, including Digital Key Share, automated complimentary room upgrades and the ability to book
confirmed connecting rooms. Through the award-winning guest loyalty program Hilton Honors, the more than 150 million
members who book directly with Hilton can earn Points for hotel stays and experiences money can't buy. With the free Hilton
Honors app, guests can book their stay, select their room, check in, unlock their door with a Digital Key and check out, all from
their smartphone. Visit stories.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.
4
HILTON WORLDWIDE HOLDINGS INC.
EARNINGS RELEASE SCHEDULES
TABLE OF CONTENTS
Page
Condensed Consolidated Statements of Operations 6
Comparable and Currency Neutral System-Wide Hotel Operating Statistics 7
Property Summary 9
Capital Expenditures and Contract Acquisition Costs 11
Reconciliations of Non-GAAP Financial Measures 12
Definitions 17
5
HILTON WORLDWIDE HOLDINGS INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in millions, except per share data)
(unaudited)
Three Months Ended Year Ended
December 31, December 31,
2022 2021 2022 2021
Revenues
Franchise and licensing fees $ 537 $ 431 $ 2,068 $ 1,493
Base and other management fees 88 60 294 176
Incentive management fees 64 38 196 98
Owned and leased hotels 349 222 1,076 598
Other revenues 31 23 102 79
1,069 774 3,736 2,444
Other revenues from managed and franchised properties 1,375 1,062 5,037 3,344
Total revenues 2,444 1,836 8,773 5,788
Expenses
Owned and leased hotels 294 227 999 679
Depreciation and amortization 39 45 162 188
General and administrative 95 103 382 405
Other expenses 25 14 60 45
453 389 1,603 1,317
Other expenses from managed and franchised properties 1,487 1,115 5,076 3,454
Total expenses 1,940 1,504 6,679 4,771
Gain (loss) on sales of assets, net — 1 — (7)
Operating income 504 333 2,094 1,010
Interest expense (120) (95) (415) (397)
Gain (loss) on foreign currency transactions 1 (8) 5 (7)
Loss on debt extinguishment — — — (69)
Other non-operating income, net 18 7 50 23
Income before income taxes 403 237 1,734 560
Income tax expense (70) (89) (477) (153)
Net income 333 148 1,257 407
Net loss (income) attributable to noncontrolling interests (5) (1) (2) 3
Net income attributable to Hilton stockholders $ 328 $ 147 $ 1,255 $ 410
Weighted average shares outstanding:
Basic 270 279 275 279
Diluted 272 282 277 281
Earnings per share:
Basic $ 1.22 $ 0.53 $ 4.56 $ 1.47
Diluted $ 1.21 $ 0.52 $ 4.53 $ 1.46
Cash dividends declared per share $ 0.15 $ — $ 0.45 $ —
6
HILTON WORLDWIDE HOLDINGS INC.
COMPARABLE AND CURRENCY NEUTRAL SYSTEM-WIDE HOTEL OPERATING STATISTICS
BY REGION, BRAND AND SEGMENT
(unaudited)
Three Months Ended December 31,
Occupancy ADR RevPAR
2022 vs. 2021 2022 vs. 2021 2022 vs. 2021
Region
U.S. 68.1 % 4.4 % pts. $ 157.20 11.9 % $ 106.99 19.6 %
Americas (excluding U.S.) 66.1 13.1 139.75 22.6 92.33 52.8
Europe 70.3 14.2 149.53 32.8 105.15 66.5
Middle East & Africa 74.2 7.1 174.24 13.9 129.27 25.9
Asia Pacific 55.8 2.5 109.21 23.0 60.97 28.8
Brand
Waldorf Astoria Hotels & Resorts 60.6 % 7.0 % pts. $ 495.99 (0.7) % $ 300.74 12.2 %
Conrad Hotels & Resorts 64.0 8.2 300.96 38.5 192.52 58.9
Canopy by Hilton 66.2 6.5 199.22 15.8 131.86 28.5
Hilton Hotels & Resorts 64.5 11.3 184.30 20.3 118.79 45.9
Curio Collection by Hilton 65.3 7.7 227.96 10.1 148.92 24.9
DoubleTree by Hilton 62.9 6.9 136.88 13.4 86.13 27.3
Tapestry Collection by Hilton 63.9 5.1 170.73 13.9 109.11 23.8
Embassy Suites by Hilton 68.2 6.7 172.55 11.4 117.66 23.6
Hilton Garden Inn 67.2 5.6 138.43 13.4 93.01 23.6
Hampton by Hilton 67.4 2.5 126.88 10.1 85.56 14.3
Tru by Hilton 67.0 3.1 120.65 8.6 80.89 13.8
Homewood Suites by Hilton 75.8 1.5 148.70 11.9 112.75 14.1
Home2 Suites by Hilton 75.0 0.5 132.80 10.7 99.57 11.4
Segment
Management and franchise 66.9 % 5.2 % pts. $ 150.82 14.0 % $ 100.94 23.6 %
Ownership
(1)
71.2 27.7 208.10 29.2 148.27 111.1
System-wide 67.0 % 5.5 % pts. $ 151.81 14.5 % $ 101.72 24.8 %
(continued on next page)
7
HILTON WORLDWIDE HOLDINGS INC.
COMPARABLE AND CURRENCY NEUTRAL SYSTEM-WIDE HOTEL OPERATING STATISTICS (continued)
BY REGION, BRAND AND SEGMENT
(unaudited)
Year Ended December 31,
Occupancy ADR RevPAR
2022 vs. 2021 2022 vs. 2021 2022 vs. 2021
Region
U.S. 69.9 % 8.8 % pts. $ 157.44 19.3 % $ 110.09 36.5 %
Americas (excluding U.S.) 63.8 20.6 138.55 28.5 88.44 89.8
Europe 67.0 25.6 147.00 43.8 98.51 132.5
Middle East & Africa 66.6 14.6 154.57 21.7 102.99 56.0
Asia Pacific 53.2 2.4 103.73 13.8 55.17 19.1
Brand
Waldorf Astoria Hotels & Resorts 55.3 % 14.3 % pts. $ 491.14 7.3 % $ 271.69 44.6 %
Conrad Hotels & Resorts 57.7 14.7 272.35 39.1 157.02 86.5
Canopy by Hilton 62.9 15.0 195.37 20.9 122.92 58.7
Hilton Hotels & Resorts 62.2 17.9 181.69 24.5 112.93 74.6
Curio Collection by Hilton 63.2 14.0 229.00 17.6 144.66 51.0
DoubleTree by Hilton 63.3 13.1 136.98 19.1 86.67 50.2
Tapestry Collection by Hilton
64.5
12.8 167.74 17.2 108.21 46.3
Embassy Suites by Hilton 68.7 12.1 173.74 19.0 119.37 44.6
Hilton Garden Inn 68.0 9.7 138.62 19.4 94.30 39.2
Hampton by Hilton 69.2 6.0 129.22 15.7 89.44 26.7
Tru by Hilton 70.0 6.4 123.72 15.5 86.62 27.2
Homewood Suites by Hilton 78.5 4.8 149.26 19.4 117.16 27.1
Home2 Suites by Hilton 77.9 3.5 134.04 16.7 104.47 22.2
Segment
Management and franchise 67.6 % 10.0 % pts. $ 150.28 20.3 % $ 101.57 41.2 %
Ownership
(1)
60.9 30.6 200.19 30.9 121.90 162.9
System-wide 67.5 % 10.3 % pts. $ 151.01 20.6 % $ 101.90 42.5 %
____________
(1)
Includes hotels owned or leased by entities in which Hilton owns a noncontrolling financial interest.
8
HILTON WORLDWIDE HOLDINGS INC.
PROPERTY SUMMARY
As of December 31, 2022
Owned / Leased
(1)
Managed Franchised Total
Properties Rooms Properties Rooms Properties Rooms Properties Rooms
Waldorf Astoria Hotels & Resorts
U.S. — — 12 4,489 — — 12 4,489
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 22 7,078 1 659 24 7,901
Canopy by Hilton
U.S. — — — — 26 4,490 26 4,490
Americas (excluding U.S.) — — 2 272 — — 2 272
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. — — 60 44,578 186 58,188 246 102,766
Americas (excluding U.S.) 1 405 30 11,559 24 7,241 55 19,205
Europe 38 11,262 46 15,580 43 11,280 127 38,122
Middle East & Africa 4 1,705 39 13,668 4 1,738 47 17,111
Asia Pacific 5 2,999 115 40,610 9 3,557 129 47,166
Curio Collection by Hilton
U.S. — — 10 4,000 64 14,003 74 18,003
Americas (excluding U.S.) — — 2 99 17 2,196 19 2,295
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 10,397 348 79,122 379 89,519
Americas (excluding U.S.) — — 3 587 39 7,822 42 8,409
Europe — — 14 3,580 109 18,610 123 22,190
Middle East & Africa — — 19 4,939 6 825 25 5,764
Asia Pacific — — 83 22,174 8 2,101 91 24,275
(continued on next page)
9
HILTON WORLDWIDE HOLDINGS INC.
PROPERTY SUMMARY (continued)
As of December 31, 2022
Owned / Leased
(1)
Managed Franchised Total
Properties Rooms Properties Rooms Properties Rooms Properties Rooms
Tapestry Collection by Hilton
U.S. — — — — 78 9,382 78 9,382
Americas (excluding U.S.) — — 1 138 7 740 8 878
Europe — — — — 6 360 6 360
Middle East & Africa — — 1 50 — — 1 50
Asia Pacific — — 1 266 1 175 2 441
Embassy Suites by Hilton
U.S. — — 38 10,121 216 48,653 254 58,774
Americas (excluding U.S.) — — 2 354 6 1,649 8 2,003
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. — — 6 689 737 101,796 743 102,485
Americas (excluding U.S.) — — 13 1,992 51 7,664 64 9,656
Europe — — 18 3,486 61 9,849 79 13,335
Middle East & Africa — — 17 3,555 3 474 20 4,029
Asia Pacific — — 58 12,688 7 1,149 65 13,837
Hampton by Hilton
U.S. — — 23 2,986 2,309 228,576 2,332 231,562
Americas (excluding U.S.) — — 12 1,537 115 13,931 127 15,468
Europe — — 16 2,697 109 16,965 125 19,662
Middle East & Africa — — 5 1,459 — — 5 1,459
Asia Pacific — — — — 274 43,892 274 43,892
Tru by Hilton
U.S. — — — — 231 22,569 231 22,569
Americas (excluding U.S.) — — — — 4 453 4 453
Homewood Suites by Hilton
U.S. — — 9 1,131 499 57,064 508 58,195
Americas (excluding U.S.) — — 3 406 24 2,688 27 3,094
Home2 Suites by Hilton
U.S. — — 2 210 545 57,080 547 57,290
Americas (excluding U.S.) — — — — 7 753 7 753
Asia Pacific — — — — 22 3,309 22 3,309
Other — — 4 1,463 6 1,436 10 2,899
Total hotels
52 17,612 778 244,037 6,255 852,078 7,085 1,113,727
Hilton Grand Vacations — — — — 80 13,703 80 13,703
Total system
52 17,612 778 244,037 6,335 865,781 7,165 1,127,430
____________
(1)
Includes hotels owned or leased by entities in which Hilton owns a noncontrolling financial interest.
10
HILTON WORLDWIDE HOLDINGS INC.
CAPITAL EXPENDITURES AND CONTRACT ACQUISITION COSTS
(dollars in millions)
(unaudited)
Three Months Ended
December 31, Increase / (Decrease)
2022 2021 $ %
Capital expenditures for property and equipment
(1)
$ 20 $ 18 2 11.1
Capitalized software costs
(2)
20 16 4 25.0
Total capital expenditures 40 34 6 17.6
Contract acquisition costs 20 40 (20) (50.0)
Total capital expenditures and contract acquisition costs $ 60 $ 74 (14) (18.9)
Year Ended
December 31, Increase / (Decrease)
2022 2021 $ %
Capital expenditures for property and equipment
(1)
$ 39 $ 35 4 11.4
Capitalized software costs
(2)
63 44 19 43.2
Total capital expenditures 102 79 23 29.1
Contract acquisition costs 81 200 (119) (59.5)
Total capital expenditures and contract acquisition costs $ 183 $ 279 (96) (34.4)
____________
(1)
Represents expenditures for hotels, corporate and other property and equipment, which include amounts indirectly reimbursed by hotel
owners of $6 million and $3 million for the three months ended December 31, 2022 and 2021, respectively, and $8 million and $6 million for
the years ended December 31, 2022 and 2021, respectively. Excludes expenditures for FF&E replacement reserves of $14 million and $18
million for the three months ended December 31, 2022 and 2021, respectively, and $54 million and $48 million for the years ended
December 31, 2022 and 2021, respectively.
(2)
Amounts include $19 million and $12 million of expenditures that were indirectly reimbursed by hotel owners for the three months ended
December 31, 2022 and 2021, respectively, and $59 million and $37 million for the years ended December 31, 2022 and 2021, respectively.
11
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 Year Ended
December 31, December 31,
2022 2021 2022 2021
Net income attributable to Hilton stockholders, as
reported
$ 328 $ 147 $ 1,255 $ 410
Diluted EPS, as reported $ 1.21 $ 0.52 $ 4.53 $ 1.46
Special items:
Net other expenses from managed and franchised
properties
$ 112 $ 53 $ 39 $ 110
Purchase accounting amortization
(1)
11 12 45 47
FF&E replacement reserves 14 18 54 48
Loss on debt extinguishment
(2)
— — — 69
Tax-related adjustment
(3)
— (5) — (43)
Other adjustments
(4)
5 (3) (4) 15
Total special items before taxes 142 75 134 246
Income tax expense on special items
(36) (20) (32) (72)
Total special items after taxes $ 106 $ 55 $ 102 $ 174
Net income, adjusted for special items $ 434 $ 202 $ 1,357 $ 584
Diluted EPS, adjusted for special items
$ 1.59 $ 0.72 $ 4.89 $ 2.08
____________
(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 that were remaining as of
December 31, 2022 will be fully amortized during 2023.
(2)
The amount relates to the redemption of senior unsecured notes and includes a redemption premium of $55 million and the accelerated
recognition of unamortized deferred financing costs related to those senior unsecured notes of $14 million.
(3)
Amounts include income tax benefits recognized related to changes in effective tax rates, which did not have an effect on cash paid for
taxes in the periods.
(4)
Amounts for the three months and year ended December 31, 2022 include net losses (gains) related to certain of Hilton's investments in
unconsolidated affiliates, which were recognized in other non-operating income, net. Amount for the year ended December 31, 2021
includes costs recognized for certain legal settlements, which were recognized in general and administrative expenses. All periods include
net losses (gains) on asset dispositions.
12
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 Year Ended
December 31, December 31,
2022 2021 2022 2021
Net income $ 333 $ 148 $ 1,257 $ 407
Interest expense 120 95 415 397
Income tax expense 70 89 477 153
Depreciation and amortization expenses 39 45 162 188
EBITDA 562 377 2,311 1,145
Loss (gain) on sales of assets, net — (1) — 7
Loss (gain) on foreign currency transactions (1) 8 (5) 7
Loss on debt extinguishment — — — 69
FF&E replacement reserves 14 18 54 48
Share-based compensation expense 36 49 162 193
Amortization of contract acquisition costs 10 9 38 32
Net other expenses from managed and franchised
properties
112 53 39 110
Other adjustments
(1)
7 (1) — 18
Adjusted EBITDA $ 740 $ 512 $ 2,599 $ 1,629
____________
(1)
Amount for the year ended December 31, 2022 was less than $1 million. Amounts for the three months and year ended December 31, 2022
include the net losses (gains) related to certain of Hilton's investments in unconsolidated affiliates. Amounts for the three months and year
ended December 31, 2021 include costs recognized for certain legal settlements. All periods include severance and other items.
Three Months Ended Year Ended
December 31, December 31,
2022 2021 2022 2021
Total revenues, as reported $ 2,444 $ 1,836 $ 8,773 $ 5,788
Add: amortization of contract acquisition costs 10 9 38 32
Less: other revenues from managed and franchised
properties
(1,375) (1,062) (5,037) (3,344)
Total revenues, as adjusted $ 1,079 $ 783 $ 3,774 $ 2,476
Net income $ 333 $ 148 $ 1,257 $ 407
Net income margin 13.6 % 8.1 % 14.3 % 7.0 %
Adjusted EBITDA $ 740 $ 512 $ 2,599 $ 1,629
Adjusted EBITDA margin 68.6% 65.4% 68.9% 65.8%
13
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)
December 31,
2022 2021
Long-term debt, including current maturities
$ 8,747 $ 8,766
Add: unamortized deferred financing costs and discount
73 87
Long-term debt, including current maturities and excluding the deduction for unamortized
deferred financing costs and discount
8,820 8,853
Less: cash and cash equivalents
(1,209) (1,427)
Less: restricted cash and cash equivalents
(77) (85)
Net debt
$ 7,534 $ 7,341
Net income
$ 1,257 $ 407
Long-term debt to net income ratio
7.0 21.5
Adjusted EBITDA
$ 2,599 $ 1,629
Net debt to Adjusted EBITDA ratio
2.9 4.5
14
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
March 31, 2023
Low Case High Case
Net income attributable to Hilton stockholders $ 270 $ 286
Diluted EPS
(1)
$ 1.00 $ 1.06
Special items
(2)
:
Purchase accounting amortization $ 11 $ 11
FF&E replacement reserves 16 16
Total special items before taxes 27 27
Income tax expense on special items (5) (5)
Total special items after taxes $ 22 $ 22
Net income, adjusted for special items $ 292 $ 308
Diluted EPS, adjusted for special items
(1)
$ 1.08 $ 1.14
Year Ending
December 31, 2023
Low Case High Case
Net income attributable to Hilton stockholders $ 1,378 $ 1,450
Diluted EPS
(1)
$ 5.10 $ 5.36
Special items
(2)
:
Purchase accounting amortization 37 37
FF&E replacement reserves 68 68
Total special items before taxes 105 105
Income tax expense on special items (18) (18)
Total special items after taxes $ 87 $ 87
Net income, adjusted for special items $ 1,465 $ 1,537
Diluted EPS, adjusted for special items
(1)
$ 5.42 $ 5.68
____________
(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.
15
HILTON WORLDWIDE HOLDINGS INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
OUTLOOK: ADJUSTED EBITDA
(in millions)
(unaudited)
Three Months Ending
March 31, 2023
Low Case High Case
Net income $ 271 $ 287
Interest expense 116 116
Income tax expense 101 106
Depreciation and amortization expenses 38 38
EBITDA 526 547
FF&E replacement reserves 16 16
Share-based compensation expense 34 34
Amortization of contract acquisition costs 11 11
Other adjustments
(1)
3 2
Adjusted EBITDA $ 590 $ 610
Year Ending
December 31, 2023
Low Case High Case
Net income $ 1,382 $ 1,454
Interest expense 440 440
Income tax expense 541 569
Depreciation and amortization expenses 151 151
EBITDA 2,514 2,614
FF&E replacement reserves 68 68
Share-based compensation expense 159 159
Amortization of contract acquisition costs 46 46
Other adjustments
(1)
13 13
Adjusted EBITDA $ 2,800 $ 2,900
____________
(1)
Includes adjustments for severance and other items. See "—Net Income Margin and Adjusted EBITDA and Adjusted EBITDA Margin" for
details of these adjustments.
16
HILTON WORLDWIDE HOLDINGS INC.
DEFINITIONS
Net Income (Loss), Adjusted for Special Items, and Diluted EPS, Adjusted for Special Items
Net income (loss), adjusted for special items, and diluted earnings (loss) per share ("EPS"), adjusted for special items, are not
recognized terms under GAAP and should not be considered as alternatives to net income (loss) or other measures of financial
performance or liquidity derived in accordance with GAAP. In addition, the Company's definition of net income (loss), adjusted for
special items, and diluted EPS, adjusted for special items, may not be comparable to similarly titled measures of other
companies.
Net income (loss), adjusted for special items, and diluted EPS, adjusted for special items, are included to assist investors in
performing meaningful comparisons of past, present and future operating results and as a means of highlighting the results of the
Company's ongoing operations.
EBITDA, Adjusted EBITDA, Net Income Margin and Adjusted EBITDA Margin
EBITDA, presented herein, reflects net income (loss), excluding interest expense, a provision for income tax benefit (expense)
and depreciation and amortization expenses. Adjusted EBITDA, presented herein, is calculated as EBITDA, as previously
defined, further adjusted to exclude certain items, including gains, losses, revenues and expenses in connection with: (i) asset
dispositions for both consolidated and unconsolidated investments; (ii) foreign currency transactions; (iii) debt restructurings and
retirements; (iv) furniture, fixtures and equipment ("FF&E") replacement reserves required under certain lease agreements;
(v) share-based compensation; (vi) reorganization, severance, relocation and other expenses; (vii) non-cash impairment; (viii)
amortization of contract acquisition costs; (ix) the net effect of reimbursable costs included in other revenues and other expenses
from managed and franchised properties; and (x) other items.
Net income margin represents net income as a percentage of total revenues. Adjusted EBITDA margin represents Adjusted
EBITDA as a percentage of total revenues, adjusted to exclude the amortization of contract acquisition costs and other revenues
from managed and franchised properties.
The Company believes that EBITDA, Adjusted EBITDA and Adjusted EBITDA margin provide useful information to investors
about the Company's financial condition and results of operations for the following reasons: (i) these measures are among the
measures used by the Company's management team to evaluate its operating performance and make day-to-day operating
decisions and (ii) these measures are frequently used by securities analysts, investors and other interested parties as a common
performance measure to compare results or estimate valuations across companies in the industry. Additionally, these measures
exclude certain items that can vary widely across different industries and among competitors within the Company's industry. For
instance, interest expense and income taxes are dependent on company specifics, including, among other things, capital
structure and operating jurisdictions, respectively, and, therefore, could vary significantly across companies. Depreciation and
amortization expenses, as well as amortization of contract acquisition costs, are dependent upon company policies, including the
method of acquiring and depreciating assets and the useful lives that are assigned to those depreciating or amortizing assets for
accounting purposes. For Adjusted EBITDA, the Company also excludes items such as: (i) FF&E replacement reserves for
leased hotels to be consistent with the treatment of capital expenditures for property and equipment, where depreciation of such
capitalized assets is reported within depreciation and amortization expenses; (ii) share-based compensation, as this could vary
widely among companies due to the different plans in place and the usage of them; (iii) the net effect of the Company's cost
reimbursement revenues and reimbursed expenses, as the Company contractually does not operate the related programs to
generate a profit over the terms of the respective contracts; and (iv) other items, such as amounts related to debt restructurings
and debt retirements and reorganization and related severance costs, that are not core to the Company's operations and are not
reflective of the Company's operating performance.
EBITDA, Adjusted EBITDA and Adjusted EBITDA margin are not recognized terms under GAAP and should not be considered as
alternatives, either in isolation or as a substitute, for net income (loss) or other measures of financial performance or liquidity,
including cash flows, derived in accordance with GAAP. Further, EBITDA, Adjusted EBITDA and Adjusted EBITDA margin have
limitations as analytical tools, may not be comparable to similarly titled measures of other companies and should not be
considered as other methods of analyzing the Company's results as reported under GAAP.
Net Debt, Long-Term Debt to Net Income Ratio and Net Debt to Adjusted EBITDA Ratio
Long-term debt to net income ratio is calculated as the ratio of Hilton's long-term debt, including current maturities, to net income.
Net debt and net debt to Adjusted EBITDA ratio, presented herein, are non-GAAP financial measures that the Company uses to
evaluate its financial leverage. Net debt is calculated as: long-term debt, including current maturities and excluding the deduction
for unamortized deferred financing costs and discount; reduced by: (i) cash and cash equivalents and (ii) restricted cash and
cash equivalents. Beginning as of March 31, 2022, the Company has modified its definition of net debt to no longer include
Hilton's share of unconsolidated affiliate debt. Since this debt is not consolidated by the Company, the modified definition more
accurately reflects how the Company and the Company's investors evaluate Hilton's financial leverage, as well as its
indebtedness.
17
Net debt should not be considered as a substitute to debt presented in accordance with GAAP, and net debt to Adjusted EBITDA
ratio should not be considered as an alternative to measures of financial condition derived in accordance with GAAP. Net debt
and net debt to Adjusted EBITDA ratio may not be comparable to similarly titled measures of other companies. The Company
believes net debt and net debt to Adjusted EBITDA ratio provide useful information about its indebtedness to investors as they
are frequently used by securities analysts, investors and other interested parties to compare the indebtedness between
companies.
Comparable Hotels
The Company defines comparable hotels as those that: (i) were active and operating in the Company's system for at least one
full calendar year as of the end of the current period, and open January 1st of the previous year; (ii) have not undergone a
change in brand or ownership type during the current or comparable periods reported; and (iii) have not sustained substantial
property damage, business interruption, undergone large-scale capital projects or for which comparable results were not
available. Of the 7,085 hotels in the Company's system as of December 31, 2022, 5,797 hotels were classified as comparable
hotels. The 1,288 non-comparable hotels included 272 hotels, or less than four percent of the total hotels in the Company's
system, that were removed from the comparable group during the last twelve months because they sustained substantial
property damage, business interruption, underwent large-scale capital projects or comparable results were otherwise not
available.
When considering business interruption in the context of the Company's definition of comparable hotels, no hotel that had
completely or partially suspended operations on a temporary basis at any time as a result of the COVID-19 pandemic was
excluded from the definition of comparable hotels on that basis alone. Despite these temporary suspensions of hotel operations,
the Company believes that including these hotels within the hotel operating statistics of occupancy, average daily rate ("ADR")
and revenue per available room ("RevPAR"), if they would have otherwise been included, reflects the underlying results of the
business for the three months and years ended December 31, 2022 and 2021.
Occupancy
Occupancy represents the total number of room nights sold divided by the total number of room nights available at a hotel or
group of hotels for a given period. Occupancy measures the utilization of available capacity at a hotel or group of hotels.
Management uses occupancy to gauge demand at a specific hotel or group of hotels in a given period. Occupancy levels also
help management determine achievable ADR pricing levels as demand for hotel rooms increases or decreases.
ADR
ADR represents hotel room revenue divided by the total number of room nights sold for a given period. ADR measures the
average room price attained by a hotel, and ADR trends provide useful information concerning the pricing environment and the
nature of the customer base of a hotel or group of hotels. ADR is a commonly used performance measure in the industry, and
management uses ADR to assess pricing levels that the Company is able to generate by type of customer, as changes in rates
charged to customers have different effects on overall revenues and incremental profitability than changes in occupancy, as
described above.
RevPAR
RevPAR is calculated by dividing hotel room revenue by the total number of room nights available to guests for a given period.
Management considers RevPAR to be a meaningful indicator of the Company's performance as it provides a metric correlated to
two primary and key drivers of operations at a hotel or group of hotels, as previously described: occupancy and ADR. RevPAR is
also a useful indicator in measuring performance over comparable periods for comparable hotels.
References to occupancy, ADR and RevPAR throughout this press release are presented on a comparable basis, based on the
comparable hotels as of December 31, 2022, and references to ADR and RevPAR are presented on a currency neutral basis,
unless otherwise noted. As such, comparisons of these hotel operating statistics for the three months and years ended
December 31, 2022 and 2021 or 2019, use the foreign currency exchange rates used to translate the results of the Company's
foreign operations within its condensed consolidated financial statements for the three months and year ended December 31,
2022.
18
