Hilton Worldwide (HLT) Tops Q2 EPS by 2c, Beats on Revenues; Raises FY17 Adj. EBITDA Guidance

Hilton Worldwide (NYSE: HLT) reported Q2 EPS of $0.52, $0.02 better than the analyst estimate of $0.50. Revenue for the quarter came in at $2.35 billion versus the consensus estimate of $2.33 billion.

Outlook

Share-based metrics in Hilton\'s outlook do not include the effect of potential share repurchases.

Full Year 2017

• System-wide RevPAR is expected to increase between 1.0 percent and 3.0 percent on a comparable and currency neutral basis compared to 2016.
• Diluted EPS, before special items, is projected to be between $1.61 and $1.68.
• Diluted EPS, adjusted for special items, is projected to be between $1.78 and $1.85.
• Net income is projected to be between $534 million and $559 million.
• Adjusted EBITDA is projected to be between $1,880 million and $1,920 million.
• Management and franchise fee revenue is projected to increase between 8 percent and 10 percent compared to 2016 on a pro forma basis.
• Capital expenditures, excluding amounts reimbursed by hotel owners, are expected to be between $150 million and $200 million.
• Cash available for capital return is projected to be between $1.0 billion and $1.1 billion.
• General and administrative expenses are projected to be between $430 million and $440 million, including approximately $30 million of transaction-related costs.

Net unit growth is expected to be approximately 50,000 rooms to 55,000 rooms.

Third Quarter 2017

• System-wide RevPAR is expected to increase between 0.0 percent and 2.0 percent on a comparable and currency neutral basis compared to the third quarter of 2016.
• Diluted EPS, before special items, is projected to be between $0.47 and $0.51.
• Diluted EPS, adjusted for special items, is projected to be between $0.47 and $0.51.
• Net income is projected to be between $156 million and $169 million.
• Adjusted EBITDA is projected to be between $490 million and $510 million.
• Management and franchise fee revenue is projected to increase between 7 percent and 9 percent compared to the third quarter of 2016 on a pro forma basis.
• Diluted EPS from continuing operations for the second quarter was $0.51 and diluted EPS, adjusted for special items, was $0.52, an increase of 30 percent from the second quarter of 2016 on a pro forma basis
• Net income for the second quarter was $167 million
• Adjusted EBITDA for the second quarter was $519 million, an increase of 10 percent from pro forma Adjusted EBITDA for the second quarter of 2016
• Adjusted EBITDA margin was 57.0 percent, an increase of 340 basis points from pro forma Adjusted EBITDA margin for the second quarter of 2016
• System-wide comparable RevPAR increased 1.8 percent on a currency neutral basis for the second quarter compared to the prior year
• Added 13,400 net rooms in the second quarter, representing approximately 30 percent growth from the same period in 2016
• Approved 27,400 new rooms for development during the second quarter, growing Hilton\'s development pipeline to a record 332,000 rooms, representing 15 percent growth from June 30, 2016
• Repurchased 4.5 million shares of Hilton common stock for an aggregate cost of $282 million during the second quarter, and 6.8 million shares at an aggregate cost of $425 million since share repurchases began in March 2017
• Raised Adjusted EBITDA guidance for full year 2017 to between $1,880 million and $1,920 million, an increase of $20 million at the midpoint
• Raised cash available for capital return guidance for full year 2017 to between $1.0 billion and $1.1 billion, an increase of $100 million at the midpoint

GUIDANCE:

Hilton Worldwide sees FY2017 EPS of $1.78-$1.85, versus the consensus of $1.83.

Hilton Worldwide sees Q3 2017 EPS of $0.47-$0.51, versus the consensus of $0.50.

For earnings history and earnings-related data on Hilton Worldwide (HLT) click here.

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