10-QPeriod: Q3 FY2024

Hilton Worldwide Holdings Inc. Quarterly Report for Q3 Ended Sep 30, 2024

Filed October 23, 2024For Securities:HLT

Summary

Hilton Worldwide Holdings Inc. reported strong financial performance for the nine months ended September 30, 2024. Total revenues increased to $8.39 billion from $7.63 billion in the prior year period, driven by robust growth in franchise and licensing fees, as well as management fees. The company's strategic focus on expanding its fee-based business through management and franchise contracts continues to yield positive results, reflected in the segment's operating income growth. While the ownership segment experienced a slight revenue dip, the overall financial health remains solid, supported by disciplined capital allocation. Significant debt refinancing activities and substantial share repurchases underscore the company's commitment to enhancing shareholder value. The company also successfully integrated two key acquisitions: the Graduate brand and the NoMad brand, further strengthening its brand portfolio and market position.

Financial Highlights

50 data points
Beta

Revenue

$2.87B

Net Income

$344.00M

12.0% Net Margin

EPS (Diluted)

$1.38

Total Assets

$16.69B

Cash & Equivalents

$1.58B

Free Cash Flow

$647.00M

Financial Statements
Beta
Revenue$2.87B
Operating Expenses$2.24B
Operating Income$623.00M
Interest Expense$140.00M
Net Income$344.00M
EPS (Basic)$1.40
EPS (Diluted)$1.38
Shares Outstanding (Basic)246.00M
Shares Outstanding (Diluted)249.00M

Key Highlights

  • 1Total revenues grew to $8.39 billion for the first nine months of 2024, up from $7.63 billion in the same period of 2023, indicating strong top-line performance.
  • 2Franchise and licensing fees increased by 10.7% to $1.96 billion for the nine months ended September 30, 2024, highlighting the success of Hilton's asset-light growth strategy.
  • 3Net income attributable to Hilton stockholders was $1.03 billion for the nine months ended September 30, 2024, an increase from $994 million in the prior year period, demonstrating improved profitability.
  • 4Diluted EPS increased to $4.09 for the nine months ended September 30, 2024, compared to $3.74 in the same period of 2023, reflecting enhanced earnings per share.
  • 5The company repurchased approximately $2.11 billion of its common stock during the nine months ended September 30, 2024, indicating a significant return of capital to shareholders.
  • 6Hilton completed the acquisition of the Graduate brand and acquired a controlling financial interest in the NoMad brand, strategically expanding its brand portfolio.
  • 7System-wide RevPAR increased by 2.4% for the nine months ended September 30, 2024, driven by a 1.5% increase in ADR and a 0.7% increase in occupancy.

Frequently Asked Questions

For the nine months ended September 30, 2024, Hilton reported total revenues of $8.39 billion, an increase from $7.63 billion in the prior year period. Net income attributable to Hilton stockholders was $1.03 billion, up from $994 million in the comparable period of 2023. Diluted Earnings Per Share (EPS) also saw an increase, reaching $4.09 for the nine-month period, compared to $3.74 in the previous year.

Hilton has actively managed its debt structure. In March and September 2024, the company issued Senior Notes totaling $2.0 billion. Additionally, in June 2024, they amended their Term Loans to align maturities and reprice the interest rate. As of September 30, 2024, total indebtedness was approximately $11.3 billion. The company had an available borrowing capacity of $1.913 billion under its Revolving Credit Facility, indicating strong liquidity.

During the nine months ended September 30, 2024, Hilton acquired the Graduate brand for $210 million and acquired a controlling financial interest in Sydell Hotels & Resorts, which owns the NoMad brand. These acquisitions are expected to enhance Hilton's brand portfolio and market presence.

Hilton continues to prioritize returning capital to shareholders. During the nine months ended September 30, 2024, the company repurchased approximately $2.11 billion of its common stock. Dividends paid during this period amounted to $113 million. As of September 30, 2024, approximately $1.7 billion remained available for future share repurchases under its existing program.