CHICAGO--(BUSINESS WIRE)--Apr. 30, 2014--
Hyatt Hotels Corporation ("Hyatt" or the "Company") (NYSE: H) today
reported first quarter 2014 financial results as follows:
-
Adjusted EBITDA was $172 million in the first quarter of 2014 compared
to $131 million in the first quarter of 2013, an increase of 31.3%.
-
Adjusted for special items, net income attributable to Hyatt was $20
million, or $0.13 per share, during the first quarter of 2014 compared
to net income attributable to Hyatt of $14 million, or $0.09 per
share, during the first quarter of 2013.
-
Net income attributable to Hyatt was $56 million, or $0.36 per share,
during the first quarter of 2014 compared to net income attributable
to Hyatt of $8 million, or $0.05 per share, in the first quarter of
2013.
-
Comparable owned and leased hotel RevPAR increased 6.5% (6.3%
excluding the effect of currency) in the first quarter of 2014
compared to the first quarter of 2013.
-
Comparable owned and leased hotel operating margins increased 120
basis points in the first quarter of 2014 compared to the first
quarter of 2013. Owned and leased hotel operating margins increased
380 basis points in the first quarter of 2014 compared to the first
quarter of 2013.
-
Comparable systemwide RevPAR increased 6.0% (7.7% excluding the effect
of currency) in the first quarter of 2014 compared to the first
quarter of 2013.
-
Comparable U.S. full service hotel RevPAR increased 8.4% in the first
quarter of 2014 compared to the first quarter of 2013. Comparable U.S.
select service hotel RevPAR increased 6.9% in the first quarter of
2014 compared to the first quarter of 2013.
-
Eight hotels were opened. As of March 31, 2014, the Company's executed
contract base consisted of approximately 240 hotels or approximately
54,000 rooms.
-
The Company repurchased 1,172,645 shares of common stock at a weighted
average price of $51.71 per share, for an aggregate purchase price of
approximately $61 million.
Mark S. Hoplamazian
, president and chief executive officer of Hyatt
Hotels Corporation, said, "In the first quarter, Hyatt's Adjusted EBITDA
grew more than 30%, driven by continued robust demand and healthy rate
growth among both transient and group guests as well as strong
performance from recent acquisitions and openings. These results
demonstrate the power of our differentiated business model and multiple
earnings tools.
"Systemwide RevPAR increased 7.7% on a constant currency basis with
strength in all regions. Comparable owned and leased margins improved
120 basis points as we saw the benefit of increasing rates and improving
flow through. Fees grew by more than 18% as we benefited from solid
RevPAR increases and new openings.
"Our asset recycling strategy continues to provide us with additional
capital to invest in growth while maintaining brand presence. During the
quarter, we closed on the sale of a portfolio of ten Hyatt Place,
Hyatt
House
and Hyatt hotels to a great partner for approximately $313 million
and we continue to manage these hotels. In addition, we are currently
marketing nine full service hotels in North America for a potential sale.
"Looking ahead, we expect healthy occupancy and rate growth,
particularly in the Americas as group business continues to recover and
transient business remains strong. Our strong balance sheet and high
quality asset base provide us with the flexibility to pursue growth in
markets in which we are underrepresented. We expect to continue our
asset recycling program while also returning capital to shareholders.
Our business model has significant leverage and we are positioned well
for robust, sustainable growth in the years ahead."
Owned and Leased Hotels Segment
Total segment Adjusted EBITDA increased 31.6% in the first quarter of
2014 compared to the same period in 2013.
Owned and leased Adjusted EBITDA increased 32.9% in the first quarter of
2014 compared to the same period in 2013. See the table on page 14 of
the accompanying schedules for a detailed list of portfolio changes and
the year-over-year net impact to first quarter owned and leased Adjusted
EBITDA.
Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA
increased 25.0% in the first quarter of 2014 compared to the same period
in 2013, primarily due to the Company's investment in the all inclusive
segment.
Revenue increased 11.4% in the first quarter of 2014 compared to the
same period in 2013. Owned and leased hotel expenses increased 6.1% in
the first quarter of 2014 compared to the same period in 2013.
RevPAR for comparable owned and leased hotels increased 6.5% (6.3%
excluding the effect of currency) in the first quarter of 2014 compared
to the same period in 2013. Occupancy improved 100 basis points and ADR
increased 5.1% (4.9% excluding the effect of currency) compared to the
same period in 2013.
Comparable hotel revenue increased 4.4% in the first quarter of 2014
compared to the same period in 2013. Excluding expenses related to
benefit programs funded through rabbi trusts and non-comparable hotel
expenses, expenses increased 2.9% in the first quarter of 2014 compared
to the same period in 2013. See the table on page 9 of the accompanying
schedules for a reconciliation of comparable owned and leased hotels
expenses to owned and leased hotels expenses.
Comparable owned and leased hotel operating margins increased 120 basis
points in the first quarter of 2014 compared to the first quarter of
2013. Comparable owned and leased hotel operating margins for hotels in
the Americas increased 150 basis points in the first quarter of 2014
compared to the first quarter of 2013. Comparable owned and leased hotel
operating margins in ASPAC and EAME/SW Asia increased 30 basis points in
the first quarter of 2014 compared to the first quarter of 2013.
Comparable owned and leased hotel operating margins in ASPAC and EAME/SW
Asia were negatively impacted by adverse market conditions at one hotel.
The following hotel was added to the portfolio during the first quarter:
-
Hyatt Place Amsterdam Airport, Netherlands (leased, 330 rooms)
The following 10 hotels were removed from the owned and leased portfolio
as they were sold during the first quarter:
-
Hyatt Market Street, The Woodlands (70 rooms)
-
Hyatt Place Fremont / Silicon Valley (151 rooms)
-
Hyatt Place Madison / Downtown (151 rooms)
-
Hyatt House Charlotte
/ Center City (163 rooms)
-
Hyatt House Cypress
/ Anaheim (142 rooms)
-
Hyatt House Emeryville / SF Bay Area (234 rooms)
-
Hyatt House San Diego
/ Sorrento Mesa (193 rooms)
-
Hyatt House San Jose
/ Silicon Valley (164 rooms)
-
Hyatt House San Ramon
(142 rooms)
-
Hyatt House Santa Clara (150 rooms)
The Company entered into a management agreement for each hotel listed
above and therefore the hotels remain included within the Hyatt system.
Additionally, during the first quarter, the Company's hotels in Baku,
Azerbaijan were consolidated into Hyatt Regency Baku.
Management and Franchise Fees
Total fee revenue increased 18.7% to $89 million in the first quarter of
2014 compared to the same period in 2013. Base management fees increased
10.8% to $41 million in the first quarter of 2014 compared to the same
period in 2013, primarily due to strong RevPAR growth and newly opened
hotels. Incentive management fees increased 8.0% to $27 million in the
first quarter of 2014 compared to the same period in 2013. Franchise
fees increased 40.0% to $14 million in the first quarter of 2014
compared to the same period in 2013, primarily due to new hotels and
hotels recently converted from managed to franchised. Other fee revenue
increased 133.3% to $7 million in the first quarter of 2014 compared to
the same period in 2013, in part due to an increase in deferred gains
and a termination fee.
Americas Management and Franchising Segment
Adjusted EBITDA increased 16.7% in the first quarter of 2014 compared to
the same period in 2013.
RevPAR for comparable Americas full service hotels increased 7.7% (8.6%
excluding the effect of currency) in the first quarter of 2014 compared
to the same period in 2013. Occupancy increased 210 basis points and ADR
increased 4.5% (5.3% excluding the effect of currency) compared to the
same period in 2013.
Group rooms revenue at comparable U.S. full service hotels increased
9.3% in the first quarter of 2014 compared to the same period in 2013.
Group room nights increased 5.7% and group ADR increased 3.4% in the
first quarter of 2014 compared to the same period in 2013.
Transient rooms revenue at comparable U.S. full service hotels increased
7.6% in the first quarter of 2014 compared to the same period in 2013.
Transient room nights increased 1.5% and transient ADR increased 6.0% in
the first quarter of 2014 compared to the same period in 2013.
RevPAR for comparable Americas select service hotels increased 7.0% in
the first quarter of 2014 compared to the same period in 2013. Occupancy
increased 110 basis points and ADR increased 5.3% compared to the same
period in 2013.
Revenue from management and franchise fees increased 17.2% in the first
quarter of 2014 compared to the same period in 2013.
The following four hotels were added to the portfolio during the first
quarter:
-
Hyatt Place Fredericksburg-Mary Washington (franchised, 93 rooms)
-
Hyatt Place Houston/The Woodlands (franchised, 146 rooms)
-
Hyatt Place Lincoln/Downtown-Haymarket (franchised, 111 rooms)
-
Hyatt Place Manatí (managed, 104 rooms)
Southeast Asia, China, Australia, South Korea and Japan (ASPAC)
Management and Franchising Segment
Adjusted EBITDA increased 22.2% in the first quarter of 2014 compared to
the same period in 2013.
RevPAR for comparable ASPAC hotels increased 2.4% (7.3% excluding the
effect of currency) in the first quarter of 2014 compared to the same
period in 2013. Occupancy increased 290 basis points and ADR decreased
2.0% (increased 2.7% excluding the effect of currency) compared to the
same period in 2013.
Revenue from management and franchise fees increased 10.5% in the first
quarter of 2014 compared to the same period in 2013.
The following hotel was added to the portfolio during the first quarter:
-
Hyatt Regency Chongming, China (managed, 235 rooms)
Europe, Africa, Middle East and Southwest Asia (EAME/SW Asia)
Management Segment
Adjusted EBITDA increased 37.5% in the first quarter of 2014 compared to
the same period in 2013.
RevPAR for comparable EAME/SW Asia hotels increased 3.0% (5.3% excluding
the effect of currency) in the first quarter of 2014 compared to the
same period in 2013. Occupancy increased 140 basis points and ADR
increased 0.8% (3.1% excluding the effect of currency) compared to the
same period in 2013.
Revenue from management fees increased 20.0% in the first quarter of
2014 compared to the same period in 2013. The increase was partially due
to newly converted hotels.
The following three hotels were added to the portfolio during the first
quarter:
-
Hyatt Raipur, India (managed, 105 rooms)
-
Hyatt Regency Ludhiana, India (managed, 168 rooms)
-
Hyatt Place Amsterdam Airport, Netherlands (leased, 330 rooms)
Two hotels were removed from the portfolio during the first quarter.
Selling, General, and Administrative Expenses
Selling, general, and administrative expenses increased 3.6% in the
first quarter of 2014 compared to the same period in 2013. Adjusted
selling, general, and administrative expenses increased 10.4% in the
first quarter of 2014 compared to the same period in 2013. The increase
was partially due to timing of marketing activities in the first
quarter. See the table on page 8 of the accompanying schedules for a
reconciliation of adjusted selling, general, and administrative expenses
to selling, general, and administrative expenses.
OPENINGS AND FUTURE EXPANSION
Eight hotels were added in the first quarter of 2014, each of which is
listed above.
The Company expects that a significant number of new properties will be
opened under all of the Company's brands in the future. As of March 31,
2014 this effort was underscored by executed management or franchise
contracts for approximately 240 hotels (or approximately 54,000 rooms)
across all brands. The executed contracts represent potential entry into
several new countries and expansion into new markets or markets in which
the Company is under-represented.
SHARE REPURCHASE
During the first quarter of 2014, the Company repurchased 1,172,645
shares of common stock at a weighted average price of $51.71 per share,
for an aggregate purchase price of approximately $61 million. From April
1 through April 25, 2014, the Company repurchased 500,529 shares of
common stock at a weighted average price of $53.91 per share, for an
aggregate purchase price of approximately $27 million. As of April 25,
2014, the Company had approximately $101 million remaining under its
share repurchase authorization.
CORPORATE FINANCE / ASSET RECYCLING
During the quarter, the Company completed the following transactions:
-
Sold 10 hotels (totaling 1,560 rooms) for approximately $313 million.
The Company continues to manage the hotels.
-
Sold its unconsolidated hospitality venture interest in Park Hyatt
Ningbo Resort and Spa (207 rooms) for approximately $3 million. As a
result of this sale, the Company's pro rata share of unconsolidated
hospitality venture debt was reduced by approximately $12 million. The
Company continues to manage the hotel.
Subsequent to the end of the quarter:
-
An unconsolidated hospitality venture sold Hyatt Place Austin Downtown
(296 rooms). The Company received approximately $25 million for its
equity interest. As a result of this sale, the Company's pro rata
share of unconsolidated hospitality venture debt was reduced by
approximately $18 million. The Company continues to franchise the
hotel.
BALANCE SHEET / OTHER ITEMS
On March 31, 2014, the Company reported the following:
-
Total debt of approximately $1.5 billion.
-
Pro rata share of non-recourse unconsolidated hospitality venture debt
of approximately $694 million compared with approximately $672 million
as of December 31, 2013.
-
Cash and cash equivalents, including investments in highly-rated money
market funds and similar investments, of approximately $765 million
and short-term investments of approximately $30 million.
-
Undrawn borrowing availability of approximately $1.4 billion under its
revolving credit facility.
2014 INFORMATION
The Company is providing the following information for the 2014 fiscal
year:
-
Adjusted SG&A expense is expected to be approximately $325 million.
-
Capital expenditures are expected to be approximately $325 million,
including approximately $150 million for investment in new properties.
-
In addition to the capital expenditures described above, the Company
intends to continue a strong level of investment spending. Investment
spending includes acquisitions, equity investments in joint ventures,
debt investments, contract acquisition costs or other investments.
-
Depreciation and amortization expense is expected to be approximately
$375 million.
-
Interest expense is expected to be approximately $75 million.
-
The Company expects to open approximately 40 hotels in 2014.
CONFERENCE CALL INFORMATION
The Company will hold an investor conference call today, April 30, 2014,
at 10:30 a.m. CT. The Company requests that questions be submitted via
email to earnings@hyatt.com by
9:00 a.m. CT. Hyatt management will read and respond to as many
submitted questions as possible. All interested persons may listen to a
simultaneous webcast of the conference call, which may be accessed
through the Company’s website at www.hyatt.com
and selecting the Investor Relations link located at the bottom of the
page, or by dialing 617.786.2904, passcode #11561402, approximately 10
minutes before the scheduled start time. For those unable to listen to
the live broadcast, a replay will be available from 1:00 p.m. CT on
April 30, 2014 through May 05, 2014 at midnight by dialing 617.801.6888,
passcode # 95827281. Additionally, an archive of the webcast will be
available on the Company’s website for approximately 90 days.
DEFINITIONS
Adjusted EBITDA
We use the term Adjusted EBITDA throughout this earnings release.
Adjusted EBITDA, as we define it, is a non-GAAP measure. We define
consolidated Adjusted EBITDA as net income attributable to Hyatt Hotels
Corporation plus our pro rata share of unconsolidated hospitality
ventures Adjusted EBITDA based on our ownership percentage of each
venture, adjusted to exclude the following items:
-
equity losses from unconsolidated hospitality ventures;
-
asset impairments;
-
gains on sales of real estate;
-
other income (loss), net;
-
depreciation and amortization;
-
interest expense; and
-
(provision) benefit for income taxes.
We calculate consolidated Adjusted EBITDA by adding the Adjusted EBITDA
of each of our reportable segments to corporate and other Adjusted
EBITDA.
Our Board of Directors and executive management team focus on Adjusted
EBITDA as a key performance and compensation measure both on a segment
and on a consolidated basis. Adjusted EBITDA assists us in comparing our
performance over various reporting periods on a consistent basis because
it removes from our operating results the impact of items that do not
reflect our core operating performance both on a segment and on a
consolidated basis. Our president and chief executive officer, who is
our chief operating decision maker, also evaluates the performance of
each of our reportable segments and determines how to allocate resources
to those segments, in significant part, by assessing the Adjusted EBITDA
of each segment. In addition, the compensation committee of our Board of
Directors determines the annual variable compensation for certain
members of our management based in part on consolidated Adjusted EBITDA,
segment Adjusted EBITDA or some combination of both.
We believe Adjusted EBITDA is useful to investors because it provides
investors the same information that we use internally for purposes of
assessing our operating performance and making selected compensation
decisions.
Adjusted EBITDA is not a substitute for net income attributable to Hyatt
Hotels Corporation, net income, cash flows from operating activities or
any other measure prescribed by GAAP. There are limitations to using
non-GAAP measures such as Adjusted EBITDA. Although we believe that
Adjusted EBITDA can make an evaluation of our operating performance more
consistent because it removes items that do not reflect our core
operations, other companies in our industry may define Adjusted EBITDA
differently than we do. As a result, it may be difficult to use Adjusted
EBITDA or similarly named non-GAAP measures that other companies may use
to compare the performance of those companies to our performance.
Because of these limitations, Adjusted EBITDA should not be considered
as a measure of the income generated by our business or discretionary
cash available to us to invest in the growth of our business. Our
management compensates for these limitations by reference to our GAAP
results and using Adjusted EBITDA supplementally.
Adjusted Selling, General, and Administrative
Expense
Adjusted selling, general, and administrative expenses exclude the
impact of expenses related to benefit programs funded through rabbi
trusts.
Comparable Owned and Leased Hotel Operating Margin
We define Comparable Owned and Leased Hotel Operating Margin as the
difference between comparable owned and leased hotels revenue and
comparable owned and leased hotels expenses. Comparable owned and leased
hotels revenue is calculated by removing non-comparable hotels revenue
from owned and leased hotels revenue as reported in our condensed
consolidated statements of income. Comparable owned and leased hotel
expenses is calculated by removing both non-comparable hotels expenses
and the impact of expenses funded through rabbi trusts from owned and
leased hotel expenses as reported in our condensed consolidated
statements of income.
Comparable Hotels
Comparable systemwide hotels represents all properties we manage or
franchise (including owned and leased properties) and that are operated
for the entirety of the periods being compared and that have not
sustained substantial damage, business interruption or undergone large
scale renovations during the periods being compared or for which
comparable results are not available. We may use variations of
comparable systemwide hotels to specifically refer to comparable
systemwide Americas full service or select service hotels for those
properties that we manage or franchise within the Americas management
and franchising segment, comparable systemwide ASPAC full service hotels
for those properties that we manage or franchise within the ASPAC
management and franchising segment, or comparable systemwide EAME/SW
Asia full service hotels for those properties that we manage within the
EAME/SW Asia management segment. Comparable operated hotels is defined
the same as Comparable systemwide hotels with the exception that it is
limited to only those hotels we manage or operate and excludes hotels we
franchise. “Comparable owned and leased hotels” represents all
properties we own or lease and that are operated and consolidated for
the entirety of the periods being compared and have not sustained
substantial damage, business interruption or undergone large scale
renovations during the periods being compared or for which comparable
results are not available. Comparable systemwide hotels and comparable
owned and leased hotels are commonly used as a basis of measurement in
the industry. Non-comparable systemwide hotels or Non-comparable owned
and leased hotels represent all hotels that do not meet the respective
definition of comparable as defined above.
Revenue per Available Room (RevPAR)
RevPAR is the product of the average daily rate and the average daily
occupancy percentage. RevPAR does not include non-room revenues, which
consist of ancillary revenues generated by a hotel property, such as
food and beverage, parking, telephone and other guest service revenues.
Our management uses RevPAR to identify trend information with respect to
room revenues from comparable properties and to evaluate hotel
performance on a regional and segment basis. RevPAR is a commonly used
performance measure in the industry.
RevPAR changes that are driven predominantly by changes in occupancy
have different implications for overall revenue levels and incremental
profitability than do changes that are driven predominantly by changes
in average room rates. For example, increases in occupancy at a hotel
would lead to increases in room revenues and additional variable
operating costs (including housekeeping services, utilities and room
amenity costs), and could also result in increased ancillary revenues
(including food and beverage). In contrast, changes in average room
rates typically have a greater impact on margins and profitability as
there is no substantial effect on variable costs.
Average Daily Rate (ADR)
ADR represents hotel room revenues, divided by total number of rooms
sold in a given period. ADR measures 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
we use ADR to assess the pricing levels that we are able to generate by
customer group, as changes in rates have a different effect on overall
revenues and incremental profitability than changes in occupancy, as
described above.
Occupancy
Occupancy represents the total number of rooms sold divided by the total
number of rooms available at a hotel or group of hotels. Occupancy
measures the utilization of our hotels' available capacity. Management
uses occupancy to gauge demand at a specific hotel or group of hotels in
a given period. Occupancy levels also help us determine achievable ADR
levels as demand for hotel rooms increases or decreases.
Select service
The term select service includes the brands Hyatt Place and
Hyatt House
.
These properties have limited food and beverage outlets and do not offer
comprehensive business or banquet facilities but rather are suited to
serve smaller business meetings.
FORWARD-LOOKING STATEMENTS
Forward-Looking Statements in this press release, which are not
historical facts, are forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements
include statements about our plans, strategies, occupancy and ADR
trends, market share, margin trends, the number of properties we expect
to open in the future, our expected adjusted SG&A expense, capital
expenditures, investment spending, depreciation and amortization expense
and interest expense estimates, financial performance, prospects or
future events and involve known and unknown risks that are difficult to
predict. As a result, our actual results, performance or achievements
may differ materially from those expressed or implied by these
forward-looking statements. In some cases, you can identify
forward-looking statements by the use of words such as “may,” “could,”
“expect,” “intend,” “plan,” “seek,” “anticipate,” “believe,” “estimate,”
“predict,” “potential,” “continue,” “likely,” “will,” “would” and
variations of these terms and similar expressions, or the negative of
these terms or similar expressions. Such forward-looking statements are
necessarily based upon estimates and assumptions that, while considered
reasonable by us and our management, are inherently uncertain. Factors
that may cause actual results to differ materially from current
expectations include, among others, general economic uncertainty in key
global markets, the rate and pace of economic recovery following
economic downturns; levels of spending in business and leisure segments
as well as consumer confidence; declines in occupancy and average daily
rate; limited visibility with respect to future bookings; our ability to
successfully achieve certain levels of operating profit at hotels that
have performance guarantees with our third-party owners; the impact of
hotel renovations; loss of key personnel; hostilities, or fear of
hostilities, including future terrorist attacks, that affect travel;
travel-related accidents; natural or man-made disasters such as
earthquakes, tsunamis, tornadoes, hurricanes, floods, oil spills and
nuclear incidents; the seasonal and cyclical nature of the real estate
and hospitality businesses; changes in distribution arrangements, such
as through Internet travel intermediaries; our ability to successfully
execute our common stock repurchase program; changes in the tastes and
preferences of our customers; relationships with associates and labor
unions and changes in labor law; the financial condition of, and our
relationships with, third-party property owners, franchisees and
hospitality venture partners; if our third-party owners, franchisees or
development partners are unable to access the capital necessary to fund
current operations or implement our plans for growth; risk associated
with potential acquisitions and dispositions and the introduction of new
brand concepts; the timing of acquisitions and dispositions; unforeseen
terminations of our management agreements; changes in the competitive
environment in our industry and the markets where we operate; outcomes
of legal proceedings; changes in federal, state, local or foreign tax
law; foreign exchange rate fluctuations or currency restructurings;
general volatility of the capital markets; our ability to access the
capital markets; and other risks discussed in the Company's filings with
the U.S. Securities and Exchange Commission, including our Annual Report
on Form 10-K, which filings are available from the SEC. We caution you
not to place undue reliance on any forward-looking statements, which are
made as of the date of this press release. We undertake no obligation to
update publicly any of these forward-looking statements to reflect
actual results, new information or future events, changes in assumptions
or changes in other factors affecting forward-looking statements, except
to the extent required by applicable laws. If we update one or more
forward-looking statements, no inference should be drawn that we will
make additional updates with respect to those or other forward-looking
statements.
About Hyatt Hotels Corporation
Hyatt Hotels Corporation, headquartered in Chicago, is a leading global
hospitality company with a proud heritage of making guests feel more
than welcome. Thousands of members of the Hyatt family strive to make a
difference in the lives of the guests they encounter every day by
providing authentic hospitality. The Company's subsidiaries manage,
franchise, own and develop hotels and resorts under the Hyatt®,
Park Hyatt®, Andaz®, Grand Hyatt®, Hyatt Regency®, Hyatt Place®, Hyatt
House®, Hyatt Zilara™
and
Hyatt Ziva
™ brand
names and have locations on six continents. Hyatt Residential
Group, Inc., a Hyatt Hotels Corporation subsidiary,
develops, operates, markets or licenses Hyatt Residences®
and Hyatt Residence Club®. As of March 31, 2014, the
Company's worldwide portfolio consisted of 554 properties in 47
countries. For more information, please visit www.hyatt.com.
Tables to follow
|
Hyatt Hotels Corporation
|
Table of Contents
|
Financial Information (unaudited)
|
|
1.
|
|
Condensed Consolidated Statements of Income
|
2.
|
|
Reconciliation of Non-GAAP to GAAP Measure: Adjusted EBITDA to
EBITDA and a Reconciliation of EBITDA to Net Income Attributable to
Hyatt Hotels Corporation
|
3.
|
|
Reconciliation of Non-GAAP to GAAP Measure: Summary of Special Items
- Three Months Ended March 31, 2014 and 2013
|
4.
|
|
Segment Financial Summary
|
5.
|
|
Hotel Chain Statistics - Comparable Locations
|
6.
|
|
Hotel Brand Statistics - Comparable Locations
|
7.
|
|
Fee Summary
|
8.
|
|
Reconciliation of Non-GAAP to GAAP Measure: Adjusted Selling,
General, and Administrative Expenses to Selling, General, and
Administrative Expenses
|
9.
|
|
Reconciliation of Non-GAAP to GAAP Measure: Comparable Owned and
Leased Hotel Operating Margin to Owned and Leased Hotel Operating
Margin
|
10.
|
|
Net Gains and Interest Income from Marketable Securities Held to
Fund Operating Programs
|
11.
|
|
Capital Expenditures and Investment Spending Summary
|
12.
|
|
Properties and Rooms / Units by Geography
|
13.
|
|
Properties and Rooms / Units by Brand
|
14.
|
|
Year-over-Year Net Impact of Portfolio Changes to Owned and Leased
Adjusted EBITDA - Three Months Ended March 31, 2014
|
|
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Page 1
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Hyatt Hotels Corporation
|
Condensed Consolidated Statements of Income
|
For the Three Months Ended March 31, 2014 and 2013
|
(in millions, except per share amounts)
|
(unaudited)
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31,
|
|
|
|
2014
|
|
|
2013
|
REVENUES:
|
|
|
|
|
|
|
|
|
Owned and leased hotels
|
|
|
$
|
548
|
|
|
|
$
|
492
|
|
Management and franchise fees
|
|
|
89
|
|
|
|
75
|
|
Other revenues
|
|
|
21
|
|
|
|
20
|
|
Other revenues from managed properties (a)
|
|
|
416
|
|
|
|
388
|
|
Total revenues
|
|
|
1,074
|
|
|
|
975
|
|
DIRECT AND SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES:
|
|
|
|
|
|
|
|
|
Owned and leased hotels
|
|
|
415
|
|
|
|
391
|
|
Depreciation and amortization
|
|
|
95
|
|
|
|
88
|
|
Other direct costs
|
|
|
8
|
|
|
|
7
|
|
Selling, general, and administrative
|
|
|
87
|
|
|
|
84
|
|
Other costs from managed properties (a)
|
|
|
416
|
|
|
|
388
|
|
Direct and selling, general, and administrative expenses
|
|
|
1,021
|
|
|
|
958
|
|
Net gains and interest income from marketable securities held to
fund operating programs
|
|
|
4
|
|
|
|
10
|
|
Equity losses from unconsolidated hospitality ventures
|
|
|
(7
|
)
|
|
|
(1
|
)
|
Interest expense
|
|
|
(19
|
)
|
|
|
(17
|
)
|
Asset impairments
|
|
|
—
|
|
|
|
(8
|
)
|
Gains on sales of real estate
|
|
|
61
|
|
|
|
—
|
|
Other income (loss), net
|
|
|
(12
|
)
|
|
|
2
|
|
INCOME BEFORE INCOME TAXES
|
|
|
80
|
|
|
|
3
|
|
(PROVISION) BENEFIT FOR INCOME TAXES
|
|
|
(24
|
)
|
|
|
5
|
|
NET INCOME
|
|
|
56
|
|
|
|
8
|
|
NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
|
|
|
—
|
|
|
|
—
|
|
NET INCOME ATTRIBUTABLE TO HYATT HOTELS CORPORATION
|
|
|
$
|
56
|
|
|
|
$
|
8
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE - Basic
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
0.36
|
|
|
|
$
|
0.05
|
|
Net income attributable to Hyatt Hotels Corporation
|
|
|
$
|
0.36
|
|
|
|
$
|
0.05
|
|
EARNINGS PER SHARE - Diluted
|
|
|
|
|
|
|
|
|
Net income
|
|
|
$
|
0.36
|
|
|
|
$
|
0.05
|
|
Net income attributable to Hyatt Hotels Corporation
|
|
|
$
|
0.36
|
|
|
|
$
|
0.05
|
|
|
|
|
|
|
|
|
|
|
Basic share counts
|
|
|
155.4
|
|
|
|
161.9
|
|
Diluted share counts
|
|
|
156.5
|
|
|
|
162.5
|
|
(a) The Company includes in total revenues the reimbursement of
costs incurred on behalf of managed hotel property owners with no
added margin and includes in direct and selling, general, and
administrative expenses these reimbursed costs. These costs relate
primarily to payroll costs where the Company is the employer.
|
|
Page 2
|
Hyatt Hotels Corporation
|
Reconciliation of Non-GAAP to GAAP Measure: Adjusted EBITDA to
EBITDA and a Reconciliation of EBITDA to Net Income Attributable
to Hyatt Hotels Corporation
|
The table below provides a reconciliation of consolidated Adjusted
EBITDA to EBITDA and a reconciliation of EBITDA to net income
attributable to Hyatt Hotels Corporation. Adjusted EBITDA, as the
Company defines it, is a non-GAAP financial measure. See
Definitions for our definition of Adjusted EBITDA and why we
present it.
|
(in millions)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
2014
|
|
|
2013
|
Adjusted EBITDA
|
|
|
|
|
|
|
$
|
172
|
|
|
|
$
|
131
|
|
Equity losses from unconsolidated hospitality ventures
|
|
|
|
|
|
|
(7
|
)
|
|
|
(1
|
)
|
Asset impairments
|
|
|
|
|
|
|
—
|
|
|
|
(8
|
)
|
Gains on sales of real estate
|
|
|
|
|
|
|
61
|
|
|
|
—
|
|
Other income (loss), net
|
|
|
|
|
|
|
(12
|
)
|
|
|
2
|
|
Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA
|
|
|
|
|
|
|
(20
|
)
|
|
|
(16
|
)
|
EBITDA
|
|
|
|
|
|
|
$
|
194
|
|
|
|
$
|
108
|
|
Depreciation and amortization
|
|
|
|
|
|
|
(95
|
)
|
|
|
(88
|
)
|
Interest expense
|
|
|
|
|
|
|
(19
|
)
|
|
|
(17
|
)
|
(Provision) benefit for income taxes
|
|
|
|
|
|
|
(24
|
)
|
|
|
5
|
|
Net income attributable to Hyatt Hotels Corporation
|
|
|
|
|
|
|
$
|
56
|
|
|
|
$
|
8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 3
|
Hyatt Hotels Corporation
|
Reconciliation of Non-GAAP to GAAP Measure: Summary of Special Items
- Three Months Ended March 31, 2014 and 2013
|
The following table represents a reconciliation of net income
attributable to Hyatt Hotels Corporation, adjusted for special
items, to net income attributable to Hyatt Hotels Corporation
presented for the three months ended March 31, 2014 and 2013,
respectively.
|
(in millions, except per share amounts)
|
|
|
|
|
Location on Condensed Consolidated
|
|
|
|
Three Months Ended
|
|
|
|
Statements of Income
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
2014
|
|
|
|
2013
|
Net income attributable to Hyatt Hotels Corporation
|
|
|
|
|
|
|
$
|
56
|
|
|
|
|
$
|
8
|
|
Earnings per share
|
|
|
|
|
|
|
$
|
0.36
|
|
|
|
|
$
|
0.05
|
|
Special items
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains on sales of real estate (a)
|
|
|
Gains on sales of real estate
|
|
|
|
(61
|
)
|
|
|
|
—
|
|
Gain on sale of cost method investment (b)
|
|
|
Other income (loss), net
|
|
|
|
(1
|
)
|
|
|
|
—
|
|
Unconsolidated hospitality ventures impairment (c)
|
|
|
Equity losses from unconsolidated hospitality ventures
|
|
|
|
1
|
|
|
|
|
—
|
|
Asset impairments (d)
|
|
|
Asset impairments
|
|
|
|
—
|
|
|
|
|
8
|
|
Foreign currency translation loss on sale of joint venture (e)
|
|
|
Equity losses from unconsolidated hospitality ventures
|
|
|
|
—
|
|
|
|
|
2
|
|
Total special items - pre-tax
|
|
|
|
|
|
|
(61
|
)
|
|
|
|
10
|
|
Income tax (provision) benefit for special items
|
|
|
(Provision) benefit for income taxes
|
|
|
|
25
|
|
|
|
|
(4
|
)
|
Total special items - after-tax
|
|
|
|
|
|
|
(36
|
)
|
|
|
|
6
|
|
Special items impact per share
|
|
|
|
|
|
|
$
|
(0.23
|
)
|
|
|
|
$
|
0.04
|
|
Net income attributable to Hyatt Hotels Corporation, adjusted for
special items
|
|
|
|
|
|
|
$
|
20
|
|
|
|
|
$
|
14
|
|
Earnings per share, adjusted for special items
|
|
|
|
|
|
|
$
|
0.13
|
|
|
|
|
$
|
0.09
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Gains on sales of real estate - The three months ended March 31,
2014 includes gains on the sale of nine select service properties
and one full service property, which will remain Hyatt-branded
hotels for a minimum of 25 years under long-term agreements.
|
(b) Gain on sale of cost method investment - During the three months
ended March 31, 2014, we sold our interest in a joint venture
classified as a cost method investment and recorded a $1 million
gain on sale.
|
(c) Unconsolidated hospitality ventures impairment - During the
three months ended March 31, 2014, we recorded $1 million of
impairment charges related to hospitality ventures.
|
(d) Asset impairments - In conjunction with our regular assessment
of impairment indicators, we identified property and equipment whose
carrying values exceeded its fair value, and as a result, we
recorded an $8 million impairment charge during the three months
ended March 31, 2013.
|
(e) Foreign currency translation loss on sale of joint venture -
During the three months ended March 31, 2013, we had a foreign
currency translation loss of $2 million as a result of the sale of
our interest in a foreign joint venture.
|
|
Page 4
|
Hyatt Hotels Corporation
|
Segment Financial Summary
|
(in millions)
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Change ($)
|
|
Change (%)
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned and leased
|
|
|
$
|
548
|
|
|
$
|
492
|
|
|
$
|
56
|
|
|
11.4
|
%
|
Management and franchising
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas
|
|
|
75
|
|
|
64
|
|
|
11
|
|
|
17.2
|
%
|
ASPAC
|
|
|
21
|
|
|
19
|
|
|
2
|
|
|
10.5
|
%
|
EAME/SW Asia
|
|
|
18
|
|
|
15
|
|
|
3
|
|
|
20.0
|
%
|
Total management and franchising
|
|
|
114
|
|
|
98
|
|
|
16
|
|
|
16.3
|
%
|
Corporate and other
|
|
|
21
|
|
|
20
|
|
|
1
|
|
|
5.0
|
%
|
Other revenues from managed properties
|
|
|
416
|
|
|
388
|
|
|
28
|
|
|
7.2
|
%
|
Eliminations
|
|
|
(25
|
)
|
|
(23
|
)
|
|
(2
|
)
|
|
(8.7
|
)%
|
Total revenues
|
|
|
$
|
1,074
|
|
|
$
|
975
|
|
|
$
|
99
|
|
|
10.2
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned and leased
|
|
|
$
|
105
|
|
|
$
|
79
|
|
|
$
|
26
|
|
|
32.9
|
%
|
Pro rata share of unconsolidated hospitality ventures
|
|
|
20
|
|
|
16
|
|
|
4
|
|
|
25.0
|
%
|
Total owned and leased
|
|
|
125
|
|
|
95
|
|
|
30
|
|
|
31.6
|
%
|
Americas management and franchising
|
|
|
56
|
|
|
48
|
|
|
8
|
|
|
16.7
|
%
|
ASPAC management and franchising
|
|
|
11
|
|
|
9
|
|
|
2
|
|
|
22.2
|
%
|
EAME/SW Asia management
|
|
|
11
|
|
|
8
|
|
|
3
|
|
|
37.5
|
%
|
Corporate and other
|
|
|
(31
|
)
|
|
(29
|
)
|
|
(2
|
)
|
|
(6.9
|
)%
|
Adjusted EBITDA
|
|
|
$
|
172
|
|
|
$
|
131
|
|
|
$
|
41
|
|
|
31.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 5
|
Hyatt Hotels Corporation
|
Hotel Chain Statistics
|
Comparable Locations
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change (in
|
|
|
|
|
|
2014
|
|
|
2013
|
|
|
Change
|
|
|
|
constant $)
|
Owned and leased hotels (# hotels) (a)
|
|
Full service (37)
|
|
|
|
|
|
ADR
|
|
|
$
|
218.24
|
|
|
$
|
209.94
|
|
|
4.0
|
%
|
|
|
|
3.7
|
%
|
|
|
Occupancy
|
|
|
72.1
|
%
|
|
69.7
|
%
|
|
2.4
|
%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
157.27
|
|
|
$
|
146.42
|
|
|
7.4
|
%
|
|
|
|
7.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Select service (44)
|
|
|
|
|
|
ADR
|
|
|
$
|
106.90
|
|
|
$
|
100.97
|
|
|
5.9
|
%
|
|
|
|
5.9
|
%
|
|
|
Occupancy
|
|
|
68.8
|
%
|
|
72.1
|
%
|
|
(3.3
|
)%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
73.59
|
|
|
$
|
72.80
|
|
|
1.1
|
%
|
|
|
|
1.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable owned and leased hotels (81)
|
|
|
|
|
|
ADR
|
|
|
$
|
191.51
|
|
|
$
|
182.18
|
|
|
5.1
|
%
|
|
|
|
4.9
|
%
|
|
|
Occupancy
|
|
|
71.3
|
%
|
|
70.3
|
%
|
|
1.0
|
%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
136.48
|
|
|
$
|
128.12
|
|
|
6.5
|
%
|
|
|
|
6.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Managed and franchised hotels (# hotels; includes owned
and leased hotels)
|
|
Americas
|
|
|
|
|
|
Full service (141)
|
|
|
|
|
|
ADR
|
|
|
$
|
185.38
|
|
|
$
|
177.47
|
|
|
4.5
|
%
|
|
|
|
5.3
|
%
|
|
|
Occupancy
|
|
|
71.3
|
%
|
|
69.2
|
%
|
|
2.1
|
%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
132.23
|
|
|
$
|
122.74
|
|
|
7.7
|
%
|
|
|
|
8.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Select service (224)
|
|
|
|
|
|
ADR
|
|
|
$
|
115.93
|
|
|
$
|
110.08
|
|
|
5.3
|
%
|
|
|
|
5.3
|
%
|
|
|
Occupancy
|
|
|
73.5
|
%
|
|
72.4
|
%
|
|
1.1
|
%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
85.27
|
|
|
$
|
79.70
|
|
|
7.0
|
%
|
|
|
|
7.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASPAC
|
|
|
|
|
|
Full service (51)
|
|
|
|
|
|
ADR
|
|
|
$
|
227.08
|
|
|
$
|
231.82
|
|
|
(2.0
|
)%
|
|
|
|
2.7
|
%
|
|
|
Occupancy
|
|
|
66.6
|
%
|
|
63.7
|
%
|
|
2.9
|
%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
151.17
|
|
|
$
|
147.65
|
|
|
2.4
|
%
|
|
|
|
7.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EAME/SW Asia
|
|
|
|
|
|
Full service (48)
|
|
|
|
|
|
ADR
|
|
|
$
|
246.64
|
|
|
$
|
244.57
|
|
|
0.8
|
%
|
|
|
|
3.1
|
%
|
|
|
Occupancy
|
|
|
65.7
|
%
|
|
64.3
|
%
|
|
1.4
|
%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
162.12
|
|
|
$
|
157.37
|
|
|
3.0
|
%
|
|
|
|
5.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable systemwide hotels (464)
|
|
|
|
|
|
ADR
|
|
|
$
|
180.39
|
|
|
$
|
175.09
|
|
|
3.0
|
%
|
|
|
|
4.7
|
%
|
|
|
Occupancy
|
|
|
70.6
|
%
|
|
68.6
|
%
|
|
2.0
|
%
|
|
pts
|
|
|
|
|
RevPAR
|
|
|
$
|
127.28
|
|
|
$
|
120.09
|
|
|
6.0
|
%
|
|
|
|
7.7
|
%
|
|
(a) Owned and leased hotel figures do not include unconsolidated
hospitality ventures.
|
|
Page 6
|
Hyatt Hotels Corporation
|
Hotel Brand Statistics
|
Comparable Locations
|
|
|
|
|
Three Months Ended March 31,
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change (in
|
|
|
|
2014
|
|
2013
|
|
Change
|
|
|
|
constant $)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Managed and franchised hotels (# hotels; includes owned and
leased hotels)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Park Hyatt (28)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADR
|
|
$
|
363.11
|
|
|
$
|
367.84
|
|
|
(1.3
|
)%
|
|
|
|
3.6
|
%
|
|
Occupancy
|
|
67.2
|
%
|
|
63.5
|
%
|
|
3.7
|
%
|
|
pts
|
|
|
|
RevPAR
|
|
$
|
243.94
|
|
|
$
|
233.68
|
|
|
4.4
|
%
|
|
|
|
9.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Andaz (9)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADR
|
|
$
|
270.93
|
|
|
$
|
261.88
|
|
|
3.5
|
%
|
|
|
|
1.7
|
%
|
|
Occupancy
|
|
74.8
|
%
|
|
66.9
|
%
|
|
7.9
|
%
|
|
pts
|
|
|
|
RevPAR
|
|
$
|
202.63
|
|
|
$
|
175.33
|
|
|
15.6
|
%
|
|
|
|
13.6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Grand Hyatt (37)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADR
|
|
$
|
241.02
|
|
|
$
|
238.77
|
|
|
0.9
|
%
|
|
|
|
4.1
|
%
|
|
Occupancy
|
|
73.6
|
%
|
|
70.6
|
%
|
|
3.0
|
%
|
|
pts
|
|
|
|
RevPAR
|
|
$
|
177.33
|
|
|
$
|
168.64
|
|
|
5.2
|
%
|
|
|
|
8.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hyatt (28)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADR
|
|
$
|
166.38
|
|
|
$
|
160.52
|
|
|
3.6
|
%
|
|
|
|
3.5
|
%
|
|
Occupancy
|
|
69.9
|
%
|
|
67.2
|
%
|
|
2.7
|
%
|
|
pts
|
|
|
|
RevPAR
|
|
$
|
116.34
|
|
|
$
|
107.89
|
|
|
7.8
|
%
|
|
|
|
7.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hyatt Regency (138)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADR
|
|
$
|
174.46
|
|
|
$
|
169.03
|
|
|
3.2
|
%
|
|
|
|
4.4
|
%
|
|
Occupancy
|
|
68.5
|
%
|
|
66.8
|
%
|
|
1.7
|
%
|
|
pts
|
|
|
|
RevPAR
|
|
$
|
119.43
|
|
|
$
|
112.94
|
|
|
5.7
|
%
|
|
|
|
7.0
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hyatt Place (170)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADR
|
|
$
|
111.13
|
|
|
$
|
105.13
|
|
|
5.7
|
%
|
|
|
|
5.7
|
%
|
|
Occupancy
|
|
73.2
|
%
|
|
71.5
|
%
|
|
1.7
|
%
|
|
pts
|
|
|
|
RevPAR
|
|
$
|
81.29
|
|
|
$
|
75.18
|
|
|
8.1
|
%
|
|
|
|
8.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hyatt House (54)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ADR
|
|
$
|
129.65
|
|
|
$
|
123.84
|
|
|
4.7
|
%
|
|
|
|
4.7
|
%
|
|
Occupancy
|
|
74.7
|
%
|
|
75.0
|
%
|
|
(0.3
|
)%
|
|
pts
|
|
|
|
RevPAR
|
|
$
|
96.85
|
|
|
$
|
92.84
|
|
|
4.3
|
%
|
|
|
|
4.3
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 7
|
Hyatt Hotels Corporation
|
Fee Summary
|
(in millions)
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
|
|
2014
|
|
|
2013
|
|
|
Change ($)
|
|
|
Change (%)
|
Fees
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Base management fees
|
|
|
$
|
41
|
|
|
|
$
|
37
|
|
|
|
$
|
4
|
|
|
|
10.8
|
%
|
Incentive management fees
|
|
|
27
|
|
|
|
25
|
|
|
|
2
|
|
|
|
8.0
|
%
|
Franchise fees
|
|
|
14
|
|
|
|
10
|
|
|
|
4
|
|
|
|
40.0
|
%
|
Other fee revenue (a)
|
|
|
7
|
|
|
|
3
|
|
|
|
4
|
|
|
|
133.3
|
%
|
Total fees
|
|
|
$
|
89
|
|
|
|
$
|
75
|
|
|
|
$
|
14
|
|
|
|
18.7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Total other fee revenues includes deferred gains, resulting from
the sales of hotels subject to management agreements, of $2 million
and $1 million for the three months ended March 31, 2014 and 2013,
respectively.
|
|
Page 8
|
Hyatt Hotels Corporation
|
Reconciliation of Non-GAAP to GAAP Measure: Adjusted Selling,
General, and Administrative Expenses to Selling, General, and
Administrative Expenses
|
Results of operations as presented on condensed consolidated
statements of income include the impact of expenses recognized
with respect to employee benefit programs funded through rabbi
trusts. Certain of these expenses are recognized in selling,
general, and administrative expenses and are completely offset by
the corresponding net gains and interest income from marketable
securities held to fund operating programs, thus having no net
impact to our earnings. Below is a reconciliation of this account
excluding the impact of our rabbi trust investments.
|
(in millions)
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Change ($)
|
|
Change (%)
|
Adjusted selling, general, and administrative expenses (a)
|
|
$
|
85
|
|
|
$
|
77
|
|
|
$
|
8
|
|
|
10.4
|
%
|
|
Rabbi trust impact
|
|
2
|
|
|
7
|
|
|
(5
|
)
|
|
|
(71.4
|
)%
|
|
Selling, general, and administrative expenses
|
|
$
|
87
|
|
|
$
|
84
|
|
|
$
|
3
|
|
|
3.6
|
%
|
|
|
(a) Segment breakdown for adjusted selling, general, and
administrative expenses.
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Change ($)
|
|
Change (%)
|
Americas management and franchising
|
|
$
|
18
|
|
|
$
|
15
|
|
|
$
|
3
|
|
|
20.0
|
%
|
|
ASPAC management and franchising
|
|
9
|
|
|
9
|
|
|
—
|
|
|
—
|
%
|
|
EAME/SW Asia management
|
|
8
|
|
|
8
|
|
|
—
|
|
|
—
|
%
|
|
Owned and leased
|
|
5
|
|
|
3
|
|
|
2
|
|
|
66.7
|
%
|
|
Corporate and other (b)
|
|
45
|
|
|
42
|
|
|
3
|
|
|
7.1
|
%
|
|
Adjusted selling, general, and administrative expenses
|
|
$
|
85
|
|
|
$
|
77
|
|
|
$
|
8
|
|
|
10.4
|
%
|
|
|
(b) Corporate and other includes vacation ownership expenses of $8
million for both the three months ended March 31, 2014 and 2013,
respectively.
|
|
Page 9
|
Hyatt Hotels Corporation
|
Reconciliation of Non-GAAP to GAAP Measure: Comparable Owned and
Leased Hotel Operating Margin to Owned and Leased Hotel Operating
Margin
|
Below is a breakdown of consolidated owned and leased hotels
revenues and expenses, as used in calculating comparable owned and
leased hotel operating margin percentages. Results of operations
as presented on the condensed consolidated statements of income
include the impact of expenses recognized with respect to employee
benefit programs funded through rabbi trusts. Certain of these
expenses are recognized in owned and leased hotels expenses and
are completely offset by the corresponding net gains and interest
income from marketable securities held to fund operating programs,
thus having no net impact to our earnings. Below is a
reconciliation of this account excluding the impact of our rabbi
trusts and excluding the impact of non-comparable hotels.
|
(in millions)
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Change ($)
|
|
Change (%)
|
Revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable owned and leased hotels
|
|
|
$
|
453
|
|
|
$
|
434
|
|
|
$
|
19
|
|
|
4.4
|
%
|
Non-comparable hotels
|
|
|
95
|
|
|
58
|
|
|
37
|
|
|
63.8
|
%
|
Owned and leased hotels revenue
|
|
|
$
|
548
|
|
|
$
|
492
|
|
|
$
|
56
|
|
|
11.4
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable owned and leased hotels
|
|
|
$
|
357
|
|
|
$
|
347
|
|
|
$
|
10
|
|
|
2.9
|
%
|
Non-comparable hotels
|
|
|
57
|
|
|
41
|
|
|
16
|
|
|
39.0
|
%
|
Rabbi trust
|
|
|
1
|
|
|
3
|
|
|
(2
|
)
|
|
(66.7
|
)%
|
Owned and leased hotels expense
|
|
|
$
|
415
|
|
|
$
|
391
|
|
|
$
|
24
|
|
|
6.1
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owned and leased hotel operating margin percentage
|
|
|
24.3
|
%
|
|
20.5
|
%
|
|
|
|
|
3.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable owned and leased hotel operating margin percentage
|
|
|
21.2
|
%
|
|
20.0
|
%
|
|
|
|
|
1.2
|
%
|
Page 10
|
Hyatt Hotels Corporation
|
Net Gains and Interest Income From Marketable Securities Held to
Fund Operating Programs
|
The table below provides a reconciliation of net gains and
interest income from marketable securities held to fund operating
programs, all of which are completely offset within other line
items of our condensed consolidated statements of income, thus
having no net impact to our earnings. The gains or losses on
securities held in rabbi trusts are offset to our owned and leased
hotels expense for our hotel staff and selling, general, and
administrative expenses for our corporate staff and personnel
supporting our business segments. The gains or losses on
securities held to fund our Hyatt Gold Passport program for our
owned and leased hotels are offset by corresponding changes to our
owned and leased hotel revenues. The table below shows the amounts
recorded to the respective offsetting account.
|
(in millions)
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
|
|
|
2014
|
|
2013
|
|
Change ($)
|
|
Change (%)
|
Rabbi trust impact allocated to selling, general, and administrative
expenses
|
|
|
$
|
2
|
|
|
$
|
7
|
|
|
$
|
(5
|
)
|
|
(71.4
|
)%
|
Rabbi trust impact allocated to owned and leased hotels expense
|
|
|
1
|
|
|
3
|
|
|
(2
|
)
|
|
(66.7
|
)%
|
Net gains and interest income from marketable securities held to
fund our Gold Passport program allocated to owned and leased hotels
revenue
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
100.0
|
%
|
Net gains and interest income from marketable securities held to
fund operating programs
|
|
|
$
|
4
|
|
|
$
|
10
|
|
|
$
|
(6
|
)
|
|
(60.0
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 11
|
Hyatt Hotels Corporation
|
Capital Expenditures and Investment Spending Summary
|
(in millions)
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
March 31,
|
|
|
|
|
|
|
2014
|
|
|
2013
|
Capital Expenditures
|
|
|
|
|
|
|
|
|
|
|
Maintenance
|
|
|
|
|
|
$
|
14
|
|
|
|
$
|
14
|
Enhancements to existing properties
|
|
|
|
|
|
16
|
|
|
|
20
|
Investment in new properties
|
|
|
|
|
|
11
|
|
|
|
9
|
Total
|
|
|
|
|
|
$
|
41
|
|
|
|
$
|
43
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
March 31,
|
Investment Spending
|
|
|
|
|
|
2014
|
|
|
2013
|
Acquisitions, net of cash acquired
|
|
|
|
|
|
$
|
—
|
|
|
|
$
|
85
|
Investments (equity, debt and other)
|
|
|
|
|
|
25
|
|
|
|
36
|
Total
|
|
|
|
|
|
$
|
25
|
|
|
|
$
|
121
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 12
|
Hyatt Hotels Corporation
|
Properties and Rooms / Units by Geography
|
|
|
|
|
|
|
|
|
|
March 31, 2014
|
|
|
December 31, 2013
|
|
|
QTD Change
|
|
|
|
|
|
|
|
|
Properties
|
|
|
Rooms/Units
|
|
|
Properties
|
|
|
Rooms/Units
|
|
|
Properties
|
|
|
Rooms/Units
|
Owned and leased hotels (a)
|
|
|
|
|
Full service hotels
|
|
|
|
|
United States
|
|
|
|
|
|
|
26
|
|
|
|
15,428
|
|
|
|
27
|
|
|
|
15,498
|
|
|
|
(1
|
)
|
|
|
(70
|
)
|
Other Americas
|
|
|
|
|
|
|
4
|
|
|
|
2,102
|
|
|
|
4
|
|
|
|
2,102
|
|
|
|
0
|
|
|
|
0
|
|
ASPAC
|
|
|
|
|
|
|
1
|
|
|
|
601
|
|
|
|
1
|
|
|
|
601
|
|
|
|
0
|
|
|
|
0
|
|
EAME/SW Asia
|
|
|
|
|
|
|
10
|
|
|
|
2,256
|
|
|
|
11
|
|
|
|
2,438
|
|
|
|
(1
|
)
|
|
|
(182
|
)
|
Select service hotels
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States
|
|
|
|
|
|
|
45
|
|
|
|
5,910
|
|
|
|
54
|
|
|
|
7,400
|
|
|
|
(9
|
)
|
|
|
(1,490
|
)
|
EAME/SW Asia
|
|
|
|
|
|
|
1
|
|
|
|
330
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1
|
|
|
|
330
|
|
Total owned and leased hotels
|
|
|
|
|
|
|
87
|
|
|
|
26,627
|
|
|
|
97
|
|
|
|
28,039
|
|
|
|
(10
|
)
|
|
|
(1,412
|
)
|
Managed and franchised hotels (includes owned and leased hotels)
|
|
|
|
March 31, 2014
|
|
|
December 31, 2013
|
|
|
QTD Change
|
|
|
|
Properties
|
|
|
Rooms/Units
|
|
|
Properties
|
|
|
Rooms/Units
|
|
|
Properties
|
|
|
Rooms/Units
|
Americas
|
|
|
|
Full service hotels
|
|
|
|
United States managed
|
|
|
101
|
|
|
55,371
|
|
|
101
|
|
|
55,368
|
|
|
0
|
|
|
|
3
|
|
Other Americas managed
|
|
|
16
|
|
|
5,955
|
|
|
16
|
|
|
5,953
|
|
|
0
|
|
|
|
2
|
|
Franchised
|
|
|
33
|
|
|
10,197
|
|
|
33
|
|
|
10,190
|
|
|
0
|
|
|
|
7
|
|
Subtotal
|
|
|
150
|
|
|
71,523
|
|
|
150
|
|
|
71,511
|
|
|
0
|
|
|
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Select service hotels
|
|
|
|
United States managed
|
|
|
96
|
|
|
12,979
|
|
|
96
|
|
|
12,979
|
|
|
0
|
|
|
|
0
|
|
Other Americas managed
|
|
|
3
|
|
|
381
|
|
|
2
|
|
|
277
|
|
|
1
|
|
|
|
104
|
|
Franchised
|
|
|
153
|
|
|
20,665
|
|
|
150
|
|
|
20,263
|
|
|
3
|
|
|
|
402
|
|
Subtotal
|
|
|
252
|
|
|
34,025
|
|
|
248
|
|
|
33,519
|
|
|
4
|
|
|
|
506
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASPAC
|
|
|
|
Full service hotels
|
|
|
|
ASPAC managed
|
|
|
58
|
|
|
21,587
|
|
|
57
|
|
|
21,429
|
|
|
1
|
|
|
|
158
|
|
ASPAC franchised
|
|
|
2
|
|
|
988
|
|
|
2
|
|
|
988
|
|
|
0
|
|
|
|
0
|
|
Subtotal
|
|
|
60
|
|
|
22,575
|
|
|
59
|
|
|
22,417
|
|
|
1
|
|
|
|
158
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EAME/SW Asia
|
|
|
|
Full service hotels
|
|
|
|
EAME managed
|
|
|
34
|
|
|
8,909
|
|
|
36
|
|
|
9,337
|
|
|
(2
|
)
|
|
|
(428
|
)
|
SW Asia managed
|
|
|
28
|
|
|
7,678
|
|
|
26
|
|
|
7,405
|
|
|
2
|
|
|
|
273
|
|
Subtotal
|
|
|
62
|
|
|
16,587
|
|
|
62
|
|
|
16,742
|
|
|
0
|
|
|
|
(155
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Select service hotels
|
|
|
|
EAME managed
|
|
|
2
|
|
|
425
|
|
|
1
|
|
|
95
|
|
|
1
|
|
|
|
330
|
|
SW Asia managed
|
|
|
1
|
|
|
115
|
|
|
1
|
|
|
115
|
|
|
0
|
|
|
|
0
|
|
Subtotal
|
|
|
3
|
|
|
540
|
|
|
2
|
|
|
210
|
|
|
1
|
|
|
|
330
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total managed and franchised hotels
|
|
|
527
|
|
|
145,250
|
|
|
521
|
|
|
144,399
|
|
|
6
|
|
|
|
851
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All Inclusive
|
|
|
2
|
|
|
925
|
|
|
2
|
|
|
925
|
|
|
0
|
|
|
|
0
|
|
Vacation ownership
|
|
|
15
|
|
|
963
|
|
|
15
|
|
|
963
|
|
|
0
|
|
|
|
0
|
|
Residential
|
|
|
10
|
|
|
1,101
|
|
|
10
|
|
|
1,101
|
|
|
0
|
|
|
|
0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total properties and rooms/units
|
|
|
554
|
|
|
148,239
|
|
|
548
|
|
|
147,388
|
|
|
6
|
|
|
|
851
|
|
|
(a) Owned and leased hotel figures do not include unconsolidated
hospitality ventures.
|
|
Page 13
|
Hyatt Hotels Corporation
|
Properties and Rooms / Units by Brand
|
|
|
|
|
March 31, 2014
|
|
|
December 31, 2013
|
|
|
QTD Change
|
Brand
|
|
|
Properties
|
|
|
Rooms/Units
|
|
|
Properties
|
|
|
Rooms/Units
|
|
|
Properties
|
|
|
Rooms/Units
|
Park Hyatt
|
|
|
32
|
|
|
6,374
|
|
|
33
|
|
|
6,535
|
|
|
(1
|
)
|
|
|
(161
|
)
|
Andaz
|
|
|
11
|
|
|
2,269
|
|
|
11
|
|
|
2,269
|
|
|
0
|
|
|
|
0
|
|
Hyatt
|
|
|
39
|
|
|
8,727
|
|
|
38
|
|
|
8,609
|
|
|
1
|
|
|
|
118
|
|
Grand Hyatt
|
|
|
40
|
|
|
22,248
|
|
|
40
|
|
|
22,262
|
|
|
0
|
|
|
|
(14
|
)
|
Hyatt Regency
|
|
|
150
|
|
|
71,067
|
|
|
149
|
|
|
70,995
|
|
|
1
|
|
|
|
72
|
|
Hyatt Place
|
|
|
197
|
|
|
26,411
|
|
|
192
|
|
|
25,575
|
|
|
5
|
|
|
|
836
|
|
Hyatt House
|
|
|
58
|
|
|
8,154
|
|
|
58
|
|
|
8,154
|
|
|
0
|
|
|
|
0
|
|
Hyatt Ziva
|
|
|
1
|
|
|
619
|
|
|
1
|
|
|
619
|
|
|
0
|
|
|
|
0
|
|
Hyatt Zilara
|
|
|
1
|
|
|
306
|
|
|
1
|
|
|
306
|
|
|
0
|
|
|
|
0
|
|
Vacation Ownership and Residential
|
|
|
25
|
|
|
2,064
|
|
|
25
|
|
|
2,064
|
|
|
0
|
|
|
|
0
|
|
Total
|
|
|
554
|
|
|
148,239
|
|
|
548
|
|
|
147,388
|
|
|
6
|
|
|
|
851
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Page 14
|
Hyatt Hotels Corporation
|
Year-over-Year Net Impact of Portfolio Changes to Owned and Leased
Adjusted EBITDA (a)
|
For the Three Months Ended March 31, 2014
|
(in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction /
|
|
1Q14 Adjusted
|
|
|
|
Rooms
|
|
Opening Date
|
|
EBITDA Impact
|
|
|
|
|
|
|
|
|
|
Dispositions (b)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3 Hyatt Place Hotels
|
|
|
426
|
|
1Q13
|
|
|
|
Hyatt Fisherman's Wharf
|
|
|
313
|
|
2Q13
|
|
|
|
Hyatt Santa Barbara
|
|
|
195
|
|
2Q13
|
|
|
|
Hyatt Regency Denver Tech Center
|
|
|
451
|
|
3Q13
|
|
|
|
Andaz Savannah
|
|
|
151
|
|
3Q13
|
|
|
|
Andaz Napa
|
|
|
141
|
|
3Q13
|
|
|
|
Hyatt Regency Santa Clara
|
|
|
501
|
|
3Q13
|
|
|
|
Hyatt Key West Resort and Spa
|
|
|
118
|
|
4Q13
|
|
|
|
10 Hyatt House, Hyatt Place and Hyatt Hotels
|
|
|
1,560
|
|
1Q14
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-over-Year Net Impact of Dispositions to Owned and Leased
Adjusted EBITDA
|
|
|
|
|
|
|
$
|
(5
|
)
|
|
|
|
|
|
|
|
|
|
Acquisitions or Openings (c)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The Driskill
|
|
|
189
|
|
1Q13
|
|
|
|
Hyatt Regency Orlando
|
|
|
1,641
|
|
4Q13
|
|
|
|
Grand Hyatt San Antonio
|
|
|
1,003
|
|
4Q13
|
|
|
|
Hyatt Place Omaha Downtown Old Market
|
|
|
159
|
|
4Q13
|
|
|
|
Hyatt Place Amsterdam Airport
|
|
|
330
|
|
1Q14
|
|
|
|
|
|
|
|
|
|
|
|
|
Year-over-Year Net Impact of Acquisitions and Openings to Owned
and Leased Adjusted EBITDA
|
|
|
|
|
|
|
$
|
27
|
|
|
|
|
|
|
|
|
|
|
Year-over-Year Net Impact of Dispositions, Acquisitions and
Openings to Owned and Leased Adjusted EBITDA
|
|
|
|
|
$
|
22
|
|
(a)
|
|
Excludes pro rata share of unconsolidated hospitality ventures.
|
(b)
|
|
Reflects 2013 Adjusted EBITDA for recently completed dispositions.
|
(c)
|
|
Reflects 2014 Adjusted EBITDA for recently completed acquisitions or
openings.
|
|
|
|

Source: Hyatt Hotels Corporation
Investors:
Hyatt Hotels Corporation
Atish Shah, 312.780.5427
atish.shah@hyatt.com
or
Media:
Hyatt
Hotels Corporation
Farley Kern, 312.780.5506
farley.kern@hyatt.com