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Jill Slattery McLean, VA 22102
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Hilton Reports Fourth Quarter and Full Year Results
MCLEAN, VA (February 16, 2022) - Hilton Worldwide Holdings Inc. ("Hilton" or the "Company") (NYSE: HLT) today reported its
fourth quarter and full year 2021 results. The following results reflect the material impact that the coronavirus ("COVID-19")
pandemic has had on Hilton's business. Highlights include:
• Diluted EPS was $0.52 for the fourth quarter and $1.46 for the full year, and diluted EPS, adjusted for special
items, was $0.72 for the fourth quarter and $2.08 for the full year
• Net income was $148 million for the fourth quarter and $407 million for the full year
• Adjusted EBITDA was $512 million for the fourth quarter and $1,629 million for the full year
• System-wide comparable RevPAR increased 104.2 percent and 60.4 percent, on a currency neutral basis, for
the fourth quarter and full year, respectively, from the same periods in 2020
• System-wide comparable RevPAR was down 13.5 percent and 30.0 percent, on a currency neutral basis, for the
fourth quarter and full year, respectively, compared to the same periods in 2019
• Approved 26,000 new rooms for development during the fourth quarter, bringing Hilton's development pipeline
to 408,000 rooms as of December 31, 2021
• Added 16,100 rooms to Hilton's system in the fourth quarter, contributing to 55,100 net additional rooms in
Hilton's system for the full year, which represented 5.6 percent net unit growth from December 31, 2020
• Full year 2022 net unit growth is expected to be approximately 5 percent
1
Overview
Christopher J. Nassetta, President & Chief Executive Officer of Hilton, said, "We were pleased to see continued recovery
throughout 2021, with our fourth quarter showing strong results versus 2019. Although new variants of the virus have had some
short-term impact, we are optimistic about the acceleration of recovery across all segments during 2022. We remain confident in
the future of our business and our ability to continue to drive strong net unit growth and free cash flow, fueled by higher margins."
During the three months and year ended December 31, 2021, while the COVID-19 pandemic continued to negatively impact
Hilton's business and hotel operating statistics, Hilton experienced significant improvement in its results compared to 2020
attributable to increased travel and tourism. As a result of the pandemic, certain hotels suspended operations at various times
throughout 2020, but the majority of those hotels were reopened by the beginning of 2021. In line with the recovery, although
some hotels did suspend operations during the year ended December 31, 2021, reopenings significantly outpaced suspensions.
As such, the operations of only approximately 360 hotels, primarily located in the U.S. and Europe, were suspended for some
period of time during the year ended December 31, 2021, as compared to approximately 1,280 hotels during the year ended
December 31, 2020. Nearly all of the hotels that suspended operations at some point since the start of the pandemic had
reopened as of December 31, 2021.
For the three months and year ended December 31, 2021, system-wide comparable RevPAR increased 104.2 percent and
60.4 percent, respectively, compared to the same periods in 2020, due to increases in both occupancy and ADR. For the three
months and year ended December 31, 2021, fee revenues increased 91 percent and 60 percent, respectively, compared to the
same periods in 2020. For comparison to pre-pandemic results, system-wide comparable RevPAR for the three months and year
ended December 31, 2021 were down 13.5 percent and 30.0 percent, respectively, compared to the three months and year
ended December 31, 2019.
For the three months ended December 31, 2021, diluted EPS was $0.52 and diluted EPS, adjusted for special items, was $0.72
compared to $(0.81) and $(0.10), respectively, for the three months ended December 31, 2020. Net income (loss) and Adjusted
EBITDA were $148 million and $512 million, respectively, for the three months ended December 31, 2021, compared to $(225)
million and $204 million, respectively, for the three months ended December 31, 2020.
For the year ended December 31, 2021, diluted EPS was $1.46 and diluted EPS, adjusted for special items, was $2.08
compared to $(2.58) and $0.10, respectively, for the year ended December 31, 2020. Net income (loss) and Adjusted EBITDA
were $407 million and $1,629 million, respectively, for the year ended December 31, 2021, compared to $(720) million and $842
million, respectively, for the year ended December 31, 2020.
Development
In the fourth quarter of 2021, Hilton opened 94 new hotels totaling 16,100 rooms and achieved net unit growth of 13,100 rooms.
During the full year 2021, Hilton opened 414 new hotels totaling 67,100 rooms and achieved net unit growth of 55,100 rooms.
During the quarter, Hilton continued the expansion of its luxury portfolio with the openings of the Conrad Tulum Riviera Maya in
Mexico and the Conrad Jiuzhaigou in China and also opened the Hilton Cancun in Mexico, the latest addition to Hilton's rapidly
expanding portfolio of all-inclusive properties. Further, Hilton continues to see growth in its focused service brands, with Hampton
by Hilton opening over 30 hotels representing 4,300 rooms during the fourth quarter.
As of December 31, 2021, Hilton's development pipeline totaled nearly 2,670 hotels representing nearly 408,000 rooms
throughout 115 countries and territories, including 28 countries and territories where Hilton does not currently have any existing
hotels. Additionally, of the rooms in the development pipeline, 198,000 of the rooms were under construction and 249,600 of the
rooms were located outside the U.S.
Balance Sheet and Liquidity
As of December 31, 2021, Hilton had $8.9 billion of long-term debt outstanding, excluding deferred financing costs and discount,
with a weighted average interest rate of 3.99 percent. Excluding 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
3.95 percent and no scheduled maturities until 2025. No amounts were outstanding under Hilton's $1.75 billion senior secured
revolving credit facility as of December 31, 2021, which had an available borrowing capacity of $1,690 million after considering
$60 million of outstanding letters of credit. Total cash and cash equivalents were $1,512 million as of December 31, 2021,
including $85 million of restricted cash and cash equivalents.
2
Conference Call
Hilton will host a conference call to discuss fourth quarter and full year 2021 results on February 16, 2022 at 10:00 a.m. Eastern
Time. Participants may listen to the live webcast by logging on to the Hilton Investor Relations website at https://ir.hilton.com/
events-and-presentations. A replay and transcript of the webcast will be available within 24 hours after the live event at https://
ir.hilton.com/financial-reporting/quarterly-results/2021.
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 6060716. 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 8884149.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements include, but are not limited
to, statements related to the expectations regarding the impact of and recovery from the COVID-19 pandemic, the performance
of Hilton's business, financial results, liquidity and capital resources and other non-historical statements. In some cases, these
forward-looking statements can be identified by the use of words such as "outlook," "believes," "expects," "potential," "continues,"
"may," "will," "should," "could," "seeks," "projects," "predicts," "intends," "plans," "estimates," "anticipates" or the negative version
of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties
including, among others, risks inherent to the hospitality industry, macroeconomic factors beyond Hilton's control, such as
challenges due to labor shortages and supply chain disruptions, risks related to the impact of the COVID-19 pandemic, including
as a result of new strains or variants of the virus and uncertainty of acceptance of the COVID-19 vaccines and their
effectiveness, competition for hotel guests and management and franchise contracts, risks related to doing business with third-
party hotel owners, performance of Hilton's information technology systems, growth of reservation channels outside of Hilton's
system, risks of doing business outside of the U.S. and Hilton's indebtedness. Additional factors that could cause Hilton's results
to differ materially from those described in the forward-looking statements can be found under the section entitled "Part I—Item
1A. Risk Factors" of Hilton's Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the Securities
and Exchange Commission (the "SEC"), as 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, 2021, which is expected to be filed
on or about the date of this press release, which are accessible on the SEC's website at www.sec.gov. Accordingly, there are or
will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements.
These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that
are included in this press release and in Hilton's filings with the SEC. The Company undertakes no obligation to publicly update
or review any forward-looking statement, whether as a result of new information, future developments or otherwise, except as
required by law.
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.
About Hilton
Hilton (NYSE: HLT) is a leading global hospitality company with a portfolio of 18 world-class brands comprising more than 6,800
properties and more than 1 million rooms in 122 countries and territories. Dedicated to fulfilling its founding vision to fill the earth
with the light and warmth of hospitality, Hilton has welcomed more than 3 billion guests in its more than 100-year history, earned
a top spot on the 2021 World's Best Workplaces list and been recognized as a global leader on the Dow Jones Sustainability
Indices for five consecutive years. In 2021, in addition to opening more than one hotel a day, Hilton 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 nearly 128 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 newsroom.hilton.com for more information, and connect with Hilton on facebook.com/
hiltonnewsroom, twitter.com/hiltonnewsroom, linkedin.com/company/hilton, instagram.com/hiltonnewsroom and youtube.com/
hiltonnewsroom.
3
HILTON WORLDWIDE HOLDINGS INC.
EARNINGS RELEASE SCHEDULES
TABLE OF CONTENTS
Page
Consolidated Statements of Operations 5
Comparable and Currency Neutral System-Wide Hotel Operating Statistics 6
Property Summary 9
Capital Expenditures and Contract Acquisition Costs 11
Reconciliations of Non-GAAP Financial Measures 12
Definitions 15
4
HILTON WORLDWIDE HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited, in millions, except share and per share data)
Three Months Ended Year Ended
December 31, December 31,
2021 2020 2021 2020
Revenues
Franchise and licensing fees $ 431 $ 233 $ 1,493 $ 945
Base and other management fees 60 31 176 123
Incentive management fees 38 13 98 38
Owned and leased hotels 222 86 598 421
Other revenues 23 21 79 73
774 384 2,444 1,600
Other revenues from managed and franchised properties 1,062 506 3,344 2,707
Total revenues 1,836 890 5,788 4,307
Expenses
Owned and leased hotels 227 142 679 620
Depreciation and amortization 45 62 188 331
General and administrative 103 122 405 311
Reorganization costs — 3 — 41
Impairment losses — 122 — 258
Other expenses 14 12 45 60
389 463 1,317 1,621
Other expenses from managed and franchised properties 1,115 622 3,454 3,104
Total expenses 1,504 1,085 4,771 4,725
Gain (loss) on sales of assets, net 1 — (7) —
Operating income (loss) 333 (195) 1,010 (418)
Interest expense (95) (113) (397) (429)
Loss on foreign currency transactions (8) (11) (7) (27)
Loss on debt extinguishments — (48) (69) (48)
Other non-operating income (loss), net 7 18 23 (2)
Income (loss) before income taxes 237 (349) 560 (924)
Income tax benefit (expense) (89) 124 (153) 204
Net income (loss) 148 (225) 407 (720)
Net loss (income) attributable to noncontrolling interests (1) 1 3 5
Net income (loss) attributable to Hilton stockholders $ 147 $ (224) $ 410 $ (715)
Weighted average shares outstanding:
Basic 279 278 279 277
Diluted
(1)
282 278 281 277
Earnings (loss) per share:
Basic $ 0.53 $ (0.81) $ 1.47 $ (2.58)
Diluted
(1)
$ 0.52 $ (0.81) $ 1.46 $ (2.58)
Cash dividends declared per share $ — $ — $ — $ 0.15
____________
(1)
The weighted average shares outstanding used in the calculation of diluted loss per share for the three months and year ended
December 31, 2020 were revised from the previously reported amounts. Refer to “Reconciliations of Non-GAAP Financial Measures – Net
Income (Loss) and Diluted EPS, Adjusted for Special Items” for additional information.
5
HILTON WORLDWIDE HOLDINGS INC.
COMPARABLE AND CURRENCY NEUTRAL SYSTEM-WIDE HOTEL OPERATING STATISTICS
BY REGION
(unaudited)
Three Months Ended December 31,
Occupancy ADR RevPAR
2021 vs. 2020 2021 vs. 2020 2021 vs. 2020
U.S. 63.3 % 21.8 % pts. $ 141.29 37.4 % $ 89.38 109.7 %
Americas (excluding U.S.) 53.8 26.7 118.53 26.1 63.81 149.9
Europe 56.8 34.1 134.48 62.4 76.35 305.8
Middle East & Africa 67.1 28.2 164.73 29.5 110.48 123.5
Asia Pacific 52.5 (4.3) 104.16 6.7 54.73 (1.4)
System-wide 61.3 20.7 137.29 35.2 84.14 104.2
Year Ended December 31,
Occupancy ADR RevPAR
2021 vs. 2020 2021 vs. 2020 2021 vs. 2020
U.S. 60.8 % 18.8 % pts. $ 132.94 13.8 % $ 80.88 64.5 %
Americas (excluding U.S.) 44.0 15.8 111.68 3.7 49.17 61.7
Europe 41.9 13.6 121.84 12.6 51.10 66.7
Middle East & Africa 52.6 18.1 139.02 10.0 73.08 67.7
Asia Pacific 50.5 6.0 101.08 4.0 51.06 18.1
System-wide 57.2 16.9 128.82 12.9 73.65 60.4
6
HILTON WORLDWIDE HOLDINGS INC.
COMPARABLE AND CURRENCY NEUTRAL SYSTEM-WIDE HOTEL OPERATING STATISTICS
BY BRAND
(unaudited)
Three Months Ended December 31,
Occupancy ADR RevPAR
2021 vs. 2020 2021 vs. 2020 2021 vs. 2020
Waldorf Astoria Hotels & Resorts 55.1 % 23.9 % pts. $ 596.43 42.2 % $ 328.51 151.2 %
Conrad Hotels & Resorts 55.5 19.2 238.27 27.9 132.32 95.7
Canopy by Hilton 59.0 30.3 155.67 28.8 91.83 165.1
Hilton Hotels & Resorts 53.3 23.6 161.82 33.1 86.22 139.0
Curio Collection by Hilton 59.1 26.1 212.69 37.1 125.62 145.3
DoubleTree by Hilton 55.8 21.1 124.55 36.3 69.55 118.8
Tapestry Collection by Hilton 59.7 26.9 151.38 32.9 90.32 141.9
Embassy Suites by Hilton 61.5 25.9 155.14 37.3 95.45 137.2
Hilton Garden Inn 61.8 21.8 124.40 38.6 76.92 114.3
Hampton by Hilton 64.8 17.8 118.35 31.3 76.69 81.2
Tru by Hilton 65.3 19.1 111.64 34.0 72.92 89.2
Homewood Suites by Hilton 74.3 16.5 133.66 27.1 99.33 63.5
Home2 Suites by Hilton 74.3 16.9 119.32 25.9 88.67 63.0
System-wide 61.3 20.7 137.29 35.2 84.14 104.2
Year Ended December 31,
Occupancy ADR RevPAR
2021 vs. 2020 2021 vs. 2020 2021 vs. 2020
Waldorf Astoria Hotels & Resorts 45.5 % 13.0 % pts. $ 556.40 45.7 % $ 252.99 104.1 %
Conrad Hotels & Resorts 43.4 11.3 215.81 9.1 93.66 47.4
Canopy by Hilton 48.0 19.3 150.78 10.2 72.32 84.4
Hilton Hotels & Resorts 44.8 13.6 152.24 7.9 68.19 54.9
Curio Collection by Hilton 49.8 17.9 199.00 18.7 99.04 85.6
DoubleTree by Hilton 50.4 15.5 117.82 10.3 59.35 59.3
Tapestry Collection by Hilton 53.6 19.8 141.98 17.2 76.07 86.0
Embassy Suites by Hilton 56.7 19.7 146.67 10.9 83.12 70.0
Hilton Garden Inn 58.7 18.7 117.53 13.7 68.94 66.9
Hampton by Hilton 63.3 18.0 114.14 15.2 72.23 61.2
Tru by Hilton 65.6 21.6 107.40 21.7 70.51 81.5
Homewood Suites by Hilton 73.9 17.5 125.57 9.7 92.82 43.7
Home2 Suites by Hilton 74.6 19.6 114.14 13.3 85.20 53.6
System-wide 57.2 16.9 128.82 12.9 73.65 60.4
7
HILTON WORLDWIDE HOLDINGS INC.
COMPARABLE AND CURRENCY NEUTRAL SYSTEM-WIDE HOTEL OPERATING STATISTICS
BY SEGMENT
(unaudited)
Three Months Ended December 31,
Occupancy ADR RevPAR
2021 vs. 2020 2021 vs. 2020 2021 vs. 2020
Management and franchise 61.5 % 20.6 % pts. $ 136.67 35.3 % $ 84.04 103.5 %
Ownership
(1)
47.7 26.5 189.34 14.7 90.27 158.0
System-wide 61.3 20.7 137.29 35.2 84.14 104.2
Year Ended December 31,
Occupancy ADR RevPAR
2021 vs. 2020 2021 vs. 2020 2021 vs. 2020
Management and franchise 57.5 % 17.1 % pts. $ 128.44 13.1 % $ 73.91 60.8 %
Ownership
(1)
33.2 7.9 172.10 1.5 57.22 33.4
System-wide 57.2 16.9 128.82 12.9 73.65 60.4
____________
(1)
Includes hotels leased by entities in which Hilton owns a noncontrolling financial interest.
8
HILTON WORLDWIDE HOLDINGS INC.
PROPERTY SUMMARY
As of December 31, 2021
Owned / Leased
(1)
Managed Franchised Total
Properties Rooms Properties Rooms Properties Rooms Properties Rooms
Waldorf Astoria Hotels & Resorts
U.S. — — 12 4,535 — — 12 4,535
Americas (excluding U.S.) — — 2 261 — — 2 261
Europe 2 463 4 898 — — 6 1,361
Middle East & Africa — — 5 1,224 — — 5 1,224
Asia Pacific — — 6 1,259 — — 6 1,259
LXR Hotels & Resorts
U.S. — — — — 3 426 3 426
Americas (excluding U.S.) — — — — 1 76 1 76
Europe — — 2 383 — — 2 383
Middle East & Africa — — 1 41 1 234 2 275
Asia Pacific — — — — 1 114 1 114
Conrad Hotels & Resorts
U.S. — — 6 2,211 1 1,496 7 3,707
Americas (excluding U.S.) — — 3 787 — — 3 787
Europe — — 4 1,155 — — 4 1,155
Middle East & Africa 1 614 3 1,569 — — 4 2,183
Asia Pacific 1 164 22 6,430 1 659 24 7,253
Canopy by Hilton
U.S. — — — — 23 3,908 23 3,908
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. — — 1 1,009 — — 1 1,009
Hilton Hotels & Resorts
U.S. — — 59 44,137 187 59,017 246 103,154
Americas (excluding U.S.) 1 405 28 10,682 26 7,826 55 18,913
Europe 39 11,514 45 15,388 43 11,268 127 38,170
Middle East & Africa 5 1,992 37 12,659 3 1,565 45 16,216
Asia Pacific 5 2,999 113 39,481 7 2,849 125 45,329
Curio Collection by Hilton
U.S. — — 7 3,272 59 12,578 66 15,850
Americas (excluding U.S.) — — 2 99 12 1,750 14 1,849
Europe — — 4 360 20 2,827 24 3,187
Middle East & Africa — — 4 741 2 557 6 1,298
Asia Pacific — — 4 773 2 248 6 1,021
DoubleTree by Hilton
U.S. — — 34 11,450 339 76,905 373 88,355
Americas (excluding U.S.) — — 3 587 34 6,745 37 7,332
Europe — — 14 3,741 108 18,286 122 22,027
Middle East & Africa — — 17 4,599 5 568 22 5,167
Asia Pacific — — 76 20,625 5 1,395 81 22,020
(continued on next page)
9
HILTON WORLDWIDE HOLDINGS INC.
PROPERTY SUMMARY (continued)
As of December 31, 2021
Owned / Leased
(1)
Managed Franchised Total
Properties Rooms Properties Rooms Properties Rooms Properties Rooms
Tapestry Collection by Hilton
U.S. — — — — 63 7,543 63 7,543
Americas (excluding U.S.) — — 1 138 4 354 5 492
Europe — — — — 3 162 3 162
Asia Pacific — — 1 266 1 175 2 441
Embassy Suites by Hilton
U.S. — — 40 10,585 210 47,063 250 57,648
Americas (excluding U.S.) — — 3 667 5 1,336 8 2,003
Motto by Hilton
U.S. — — — — 3 871 3 871
Hilton Garden Inn
U.S. — — 4 425 728 100,542 732 100,967
Americas (excluding U.S.) — — 11 1,571 51 7,664 62 9,235
Europe — — 19 3,642 60 9,727 79 13,369
Middle East & Africa — — 16 3,400 3 474 19 3,874
Asia Pacific — — 47 10,245 1 177 48 10,422
Hampton by Hilton
U.S. — — 27 3,519 2,281 224,999 2,308 228,518
Americas (excluding U.S.) — — 13 1,644 109 13,305 122 14,949
Europe — — 16 2,697 96 14,795 112 17,492
Middle East & Africa — — 4 1,238 — — 4 1,238
Asia Pacific — — — — 219 35,633 219 35,633
Tru by Hilton
U.S. — — — — 212 20,664 212 20,664
Americas (excluding U.S.) — — — — 2 179 2 179
Homewood Suites by Hilton
U.S. — — 10 1,172 489 55,819 499 56,991
Americas (excluding U.S.) — — 3 406 24 2,688 27 3,094
Home2 Suites by Hilton
U.S. — — 2 210 512 53,596 514 53,806
Americas (excluding U.S.) — — — — 7 753 7 753
Asia Pacific — — — — 2 275 2 275
Other — — 2 1,250 6 1,614 8 2,864
Total hotels
54 18,151 745 234,640 5,978 812,622 6,777 1,065,413
Hilton Grand Vacations — — — — 60 9,378 60 9,378
Total system
54 18,151 745 234,640 6,038 822,000 6,837 1,074,791
____________
(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
(unaudited, dollars in millions)
Three Months Ended
December 31, Increase / (Decrease)
2021 2020 $ %
Capital expenditures for property and equipment
(1)
$ 18 $ 8 10
NM
(3)
Capitalized software costs
(2)
16 8 8 100.0
Total capital expenditures 34 16 18
NM
(3)
Contract acquisition costs 40 13 27
NM
(3)
Total capital expenditures and contract acquisition costs $ 74 $ 29 45
NM
(3)
Year Ended
December 31, Increase / (Decrease)
2021 2020 $ %
Capital expenditures for property and equipment
(1)
$ 35 $ 46 (11) (23.9)
Capitalized software costs
(2)
44 46 (2) (4.3)
Total capital expenditures 79 92 (13) (14.1)
Contract acquisition costs 200 50 150
NM
(3)
Total capital expenditures and contract acquisition costs $ 279 $ 142 137 96.5
____________
(1)
Represents expenditures for hotels, corporate and other property and equipment, which include amounts indirectly reimbursed by hotel
owners of $3 million and $1 million for the three months ended December 31, 2021 and 2020, respectively, and $6 million and $11 million for
the years ended December 31, 2021 and 2020, respectively. Excludes expenditures for FF&E replacement reserves of $18 million for both
the three months ended December 31, 2021 and 2020 and $48 million and $57 million for the years ended December 31, 2021 and 2020,
respectively.
(2)
Includes $12 million and $8 million of expenditures that were indirectly reimbursed by hotel owners for the three months ended
December 31, 2021 and 2020, respectively, and $37 million and $39 million for the years ended December 31, 2021 and 2020, respectively.
(3)
Fluctuation in terms of percentage change is not meaningful.
11
HILTON WORLDWIDE HOLDINGS INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
NET INCOME (LOSS) AND DILUTED EPS, ADJUSTED FOR SPECIAL ITEMS
(unaudited, in millions, except per share data)
Three Months Ended Year Ended
December 31, December 31,
2021 2020 2021 2020
Net income (loss) attributable to Hilton stockholders, as
reported
$ 147 $ (224) $ 410 $ (715)
Diluted EPS, as reported
(1)
$ 0.52 $ (0.81) $ 1.46 $ (2.58)
Special items:
Net other expenses from managed and franchised
properties
$ 53 $ 116 $ 110 $ 397
Purchase accounting amortization
(2)
12 21 47 164
FF&E replacement reserves 18 18 48 57
Reorganization costs — 3 — 41
Impairment losses — 122 — 258
Loss on debt extinguishments
(3)
— 48 69 48
Tax-related adjustments
(4)
(5) — (43) —
Other adjustments
(5)
(3) (11) 15 28
Total special items before taxes 75 317 246 993
Income tax expense on special items
(20) (120) (72) (250)
Total special items after taxes $ 55 $ 197 $ 174 $ 743
Net income (loss), adjusted for special items $ 202 $ (27) $ 584 $ 28
Diluted EPS, adjusted for special items
(6)
$ 0.72 $ (0.10) $ 2.08 $ 0.10
____________
(1)
The weighted average shares outstanding used in the calculation of diluted EPS for both the three months and year ended December 31,
2020 were revised from the previously reported amount of 279 million for both periods to 278 million for the three months ended December
31, 2020 and 277 million for the year ended December 31, 2020, as the previously reported dilutive shares were determined to be anti-
dilutive as a result of the net loss attributable to Hilton stockholders reported during those periods.
(2)
Amounts represent the amortization of 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. Certain of these assets became fully amortized during the year ended December 31,
2020, and the majority of the remaining assets will be fully amortized during 2023.
(3)
The amount for the year ended December 31, 2021 relates to the redemption of the 5.125% Senior Notes due 2026 and includes a
redemption premium of $55 million and the accelerated recognition of unamortized deferred financing costs related to the redeemed notes
of $14 million. The amounts for the three months and year ended December 31, 2020 relate to the redemptions of the 4.250% Senior Notes
due 2024 and the 4.625% Senior Notes due 2025 and include redemption premiums totaling $31 million and the accelerated recognition of
unamortized deferred financing costs related to the redeemed notes of $17 million.
(4)
The amounts for the three months and year ended December 31, 2021 include income tax benefits recognized related to changes in
effective tax rates. The benefits recognized did not have an effect on cash paid for taxes in the periods.
(5)
The amounts for the years ended December 31, 2021 and 2020 include costs recognized for certain legal settlements, which were
recognized in general and administrative expenses and other expenses, respectively. The amounts for the three months and year ended
December 31, 2020 also include gains related to reimbursements by a third party for taxes owed from the sale of a hotel in a prior period,
and the year ended December 31, 2020 further includes losses related to the disposal of an investment and the settlement of a debt
guarantee for a franchised hotel, which were all recognized in other non-operating income (loss), net. Amounts for all periods include losses
(gains) on asset dispositions.
(6)
The weighted average shares outstanding used in the calculation of diluted EPS, adjusted for special items, for the three months ended
December 31, 2020 was revised from the previously reported amount of 279 million to 278 million, as the previously reported dilutive shares
were determined to be anti-dilutive as a result of a net loss, adjusted for special items, reported during the period. For the year ended
December 31, 2020, the weighted average shares outstanding used in the calculation of diluted EPS, adjusted for special items, remained
unchanged at 279 million shares as net income, adjusted for special items, was reported for the period.
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HILTON WORLDWIDE HOLDINGS INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN
(unaudited, dollars in millions)
Three Months Ended Year Ended
December 31, December 31,
2021 2020 2021 2020
Net income (loss)
$ 148 $ (225) $ 407 $ (720)
Interest expense
95 113 397 429
Income tax expense (benefit)
89 (124) 153 (204)
Depreciation and amortization expenses
45 62 188 331
EBITDA
377 (174) 1,145 (164)
Loss (gain) on sales of assets, net
(1) — 7 —
Loss on foreign currency transactions
8 11 7 27
Loss on debt extinguishments
— 48 69 48
FF&E replacement reserves
18 18 48 57
Share-based compensation expense
49 60 193 97
Reorganization costs
— 3 — 41
Impairment losses
— 122 — 258
Amortization of contract acquisition costs
9 7 32 29
Net other expenses from managed and franchised
properties
53 116 110 397
Other adjustment items
(1)
(1) (7) 18 52
Adjusted EBITDA
$ 512 $ 204 $ 1,629 $ 842
____________
(1)
The amounts for the three months and year ended December 31, 2021 and the year ended December 31, 2020 include costs recognized
for certain legal settlements, severance not related to the reorganization activities undertaken in response to the COVID-19 pandemic and
other items. The amounts for the three months and year ended December 31, 2020 include a gain related to the reimbursement by a third
party for taxes owed resulting from the sale of a hotel in a prior period, and the year ended December 31, 2020 further includes losses
related to the disposal of an investment and the settlement of a debt guarantee for a franchised hotel.
Three Months Ended Year Ended
December 31, December 31,
2021 2020 2021 2020
Total revenues, as reported
$ 1,836 $ 890 $ 5,788 $ 4,307
Add: amortization of contract acquisition costs
9 7 32 29
Less: other revenues from managed and franchised
properties (1,062) (506) (3,344) (2,707)
Total revenues, as adjusted
$ 783 $ 391 $ 2,476 $ 1,629
Adjusted EBITDA
$ 512 $ 204 $ 1,629 $ 842
Adjusted EBITDA margin
65.4% 52.2% 65.8% 51.7%
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HILTON WORLDWIDE HOLDINGS INC.
RECONCILIATIONS OF NON-GAAP FINANCIAL MEASURES
NET DEBT AND NET DEBT TO ADJUSTED EBITDA RATIO
(unaudited, dollars in millions)
December 31,
2021 2020
Long-term debt, including current maturities $ 8,766 $ 10,487
Add: unamortized deferred financing costs and discount 87 93
Long-term debt, including current maturities and excluding unamortized deferred financing
costs and discount 8,853 10,580
Add: Hilton's share of unconsolidated affiliate debt 9 8
Less: cash and cash equivalents (1,427) (3,218)
Less: restricted cash and cash equivalents (85) (45)
Net debt $ 7,350 $ 7,325
Adjusted EBITDA $ 1,629 $ 842
Net debt to Adjusted EBITDA ratio 4.5 8.7
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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 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 equity 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.
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 used. 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 payments for such capitalized assets are depreciated over their useful lives;
(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 and Net Debt to Adjusted EBITDA Ratio
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: (i) long-term debt, including current maturities and excluding
unamortized deferred financing costs and discount, and (ii) the Company's share of unconsolidated affiliate debt; reduced
by: (a) cash and cash equivalents and (b) restricted cash and cash equivalents.
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
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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 6,777 hotels in the Company's system as of December 31, 2021, 5,524 hotels were classified as comparable
hotels. The 1,253 non-comparable hotels included 70 hotels, or approximately one 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 years ended December 31, 2021 and 2020.
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 the 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 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, 2021, 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, 2021 and 2020 or 2019 use the foreign currency exchange rates used to translate the results of the Company's
foreign operations within its financial statements for the three months and year ended December 31, 2021, respectively.
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