Hyatt Reports Fourth Quarter and Full Year 2023 Results
Record Total Fee Revenue Led to the Highest Cash Flow from Operations in Company History
Full Year System-Wide RevPAR Increased 17%
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Hyatt Q4 and Full Year 2023 Infographic
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Net income was
$26 million in the fourth quarter and$220 million for the full year of 2023, and exceeded the full year outlook for 2023. Adjusted net income was$68 million in the fourth quarter and$276 million for the full year of 2023. -
Diluted EPS was
$0.25 in the fourth quarter and$2.05 for the full year of 2023. Adjusted Diluted EPS was$0.64 in the fourth quarter and$2.56 for the full year of 2023. -
Adjusted EBITDA was
$241 million in the fourth quarter and$1,029 million for the full year of 2023, and exceeded the full year outlook range for 2023.-
Adjusted EBITDA does not include Net Deferrals and Net Financed Contracts of
$33 million 1 in the fourth quarter or Net Deferrals and Net Financed Contracts of$158 million 1 for the full year of 2023.
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Adjusted EBITDA does not include Net Deferrals and Net Financed Contracts of
- Comparable system-wide RevPAR increased 9.1% in the fourth quarter and 17.0% for the full year of 2023, compared to the same periods in 2022, and exceeded the full year outlook for 2023.
- Comparable owned and leased hotels RevPAR increased 5.9% in the fourth quarter and 15.5% for the full year of 2023, compared to the same periods in 2022. Comparable owned and leased hotels operating margin was 26.2% in the fourth quarter and 25.4% for the full year of 2023.
- Comparable Net Package RevPAR increased 11.3% in the fourth quarter and 15.3% for the full year of 2023 compared to the same periods in 2022.
- Net Rooms Growth was 5.9% for the full year of 2023, in line with the full year outlook for 2023.
- Pipeline of executed management or franchise contracts was approximately 127,000 rooms.
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Share Repurchases were approximately 890 thousand Class A shares for
$95 million in the fourth quarter and approximately 4.1 million Class A shares for$453 million for the full year of 2023. -
Capital Returns to Shareholders were
$500 million for the full year of 2023, inclusive of dividends and share repurchases, in line with the full year outlook for 2023.
1 Represents the sum of Net Deferrals and Net Financed Contracts. Refer to Apple Leisure Group Segment Statistics on schedule A-18 for additional details. |
Operational Update
A record level of management, franchise, license, and other fees of
Comparable system-wide RevPAR increased 9.1% in the fourth quarter and increased 17.0% for the full year of 2023, compared to the same periods in 2022, driven by the rapid recovery in
Comparable Net Package RevPAR for ALG properties increased 9.2% in the fourth quarter and 13.6% for the full year of 2023, compared to the same periods in 2022. The fourth quarter benefited from improved results in
Segment Results and Highlights
(in millions) |
Three Months Ended
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|
Year Ended
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2023 |
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|
2022 |
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|
Change (%) |
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|
2023 |
|
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|
2022 |
|
|
Change (%) |
||
Owned and leased hotels |
$ |
90 |
|
|
$ |
88 |
|
|
3.0 |
% |
|
$ |
312 |
|
|
$ |
307 |
|
|
1.7 |
% |
|
|
114 |
|
|
|
106 |
|
|
7.6 |
% |
|
|
469 |
|
|
|
422 |
|
|
11.2 |
% |
ASPAC management and franchising (a) |
|
36 |
|
|
|
20 |
|
|
76.9 |
% |
|
|
126 |
|
|
|
54 |
|
|
131.9 |
% |
EAME management and franchising (a) |
|
17 |
|
|
|
15 |
|
|
19.7 |
% |
|
|
61 |
|
|
|
47 |
|
|
30.4 |
% |
|
|
21 |
|
|
|
43 |
|
|
(52.8 |
)% |
|
|
199 |
|
|
|
231 |
|
|
(14.0 |
)% |
Corporate and other |
|
(37 |
) |
|
|
(40 |
) |
|
6.6 |
% |
|
|
(139 |
) |
|
|
(154 |
) |
|
9.9 |
% |
Eliminations |
|
— |
|
|
|
— |
|
|
772.6 |
% |
|
|
1 |
|
|
|
1 |
|
|
33.1 |
% |
Adjusted EBITDA |
$ |
241 |
|
|
$ |
232 |
|
|
4.0 |
% |
|
$ |
1,029 |
|
|
$ |
908 |
|
|
13.4 |
% |
|
|
|
|
|
|
|
|
|
|
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|
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Three Months Ended
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Year Ended
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2023 |
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|
2022 |
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Change (%) |
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2023 |
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2022 |
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Change (%) |
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Net Deferrals |
$ |
18 |
|
|
$ |
28 |
|
|
(37.2 |
)% |
|
$ |
91 |
|
|
$ |
94 |
|
|
(3.4 |
)% |
Net Financed Contracts |
$ |
15 |
|
|
$ |
15 |
|
|
1.7 |
% |
|
$ |
67 |
|
|
$ |
63 |
|
|
6.9 |
% |
(a) Effective |
- Owned and leased hotels segment: Results in the fourth quarter were driven by the recovery of group demand and increased rate growth across group and transient customers which contributed to strong RevPAR growth over the fourth quarter of 2022. Comparable owned and leased hotels operating margin expanded 240 basis points compared to the fourth quarter of 2019 and 310 basis points compared to the full year of 2019.
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Americas management and franchising segment: Results in the fourth quarter were driven by improved group and business transient results along with resilient leisure demand. Total fees in the quarter increased 6% compared to the fourth quarter of 2022, with RevPAR inthe United States up 3% in the fourth quarter compared to the same period in 2022, driven by strong group rate. -
ASPAC management and franchising segment: Results in the fourth quarter were driven by strength in all customer segments which contributed to RevPAR growth across the sub regions, with
Greater China improving 84% compared to the fourth quarter of 2022. -
EAME management and franchising segment: Results in the fourth quarter were driven by resilient leisure demand and strong business transient and group performance, despite the impact of the 2022
World Cup inQatar . The region benefited from increased airlift fromthe United States ,Middle East , andChina . -
Apple Leisure Group segment: Results in the fourth quarter benefited from improved results inCancun . ALG segment Adjusted EBITDA for the quarter increased 33% when adjusted for the$23 million non-cash benefit in the fourth quarter of 2022, that did not repeat in 2023, and the unfavorable impact of foreign currency exchange rates from the strengthening Mexican Peso.
Openings and Development
In the fourth quarter, 29 new hotels (or 9,648 rooms) joined Hyatt's portfolio, inclusive of six hotels in
For the full year of 2023, 101 new hotels (or 23,965 rooms) joined Hyatt's portfolio, inclusive of 43 hotels (or 13,223 rooms) which converted to a Hyatt brand.
As of
Transactions and Capital Strategy
On
On
The Company is providing updates on the progress for five asset sales. The Company has signed definitive purchase and sale agreements for two assets that aggregate to approximately
The Company remains committed to successfully executing plans to realize
Balance Sheet and Liquidity
As of
-
Total debt of
$3,056 million . -
Pro rata share of unconsolidated hospitality venture debt of
$548 million , substantially all of which is non-recourse to Hyatt and a portion of which Hyatt guarantees pursuant to separate agreements. -
Total liquidity of approximately
$2.4 billion with$896 million of cash and cash equivalents and short-term investments, and borrowing availability of$1,496 million under Hyatt's revolving credit facility, net of letters of credit outstanding.
The Company repurchased a total of 889,902 Class A common shares for approximately
From
Segment Realignment
During the quarter ending
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Management and franchising, which consists of the provision of management, franchising, and hotel services, or the licensing of our intellectual property to, (i) our property portfolio, (ii) our co-branded credit card programs, and (iii) other hospitality-related businesses, including the
Unlimited Vacation Club ; - Owned and leased, which consists of our owned and leased hotel portfolio and, for purposes of owned and leased segment Adjusted EBITDA, our pro rata share of unconsolidated hospitality ventures' Adjusted EBITDA based on our ownership percentage of each venture; and
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Distribution, which consists of distribution and destination management services offered through
ALG Vacations and the boutique and luxury global travel platform offered through Mr &Mrs Smith .
2024 Outlook
The Company is providing the following outlook for the 2024 fiscal year. Please refer to the table on schedule A-22 which bridges 2023 full year reported actual results to illustrative 2023 results that adjust for the sale of
|
|
Full Year 2024 vs. 2023 |
System-Wide RevPAR1 |
|
3% to 5% |
Net Rooms Growth |
|
5.5% to 6% |
(in millions) |
|
Full Year 2024 |
Net Income |
|
Approx. |
Management, Franchise, License, and Other Fees |
|
|
Adjusted SG&A2, 3 |
|
|
Adjusted EBITDA2 |
|
|
Net Deferrals + Net Financed Contracts |
|
N/A - Refer to Transactions and Capital Strategy
|
Capital Expenditures |
|
Approx. |
Free Cash Flow2 |
|
|
Capital Returns to Shareholders4 |
|
|
1 RevPAR is based on constant currency whereby previous periods are translated based on the current period exchange rate. RevPAR percentage for 2024 vs. 2023 is based on comparable hotels. |
2 Refer to the tables beginning with schedule A-15 for a reconciliation of estimated net income attributable to |
3 Adjusted SG&A outlook excludes integration related expenses. |
4 The Company expects to return capital to shareholders through a combination of cash dividends on its common stock and share repurchases. |
No disposition or acquisition activity beyond what has been completed as of the date of this release has been included in the 2024 Outlook. The Company's 2024 Outlook is based on a number of assumptions that are subject to change and many of which are outside the control of the Company. If actual results vary from these assumptions, the Company's expectations may change. There can be no assurance that Hyatt will achieve these results. |
Conference Call Information
The Company will hold an investor conference call this morning,
Participants may listen to a simultaneous webcast of the conference call, which may be accessed through the Company's website at investors.hyatt.com. Alternatively, participants may access the live call by dialing: 800-715-9871 (
A replay of the call will be available
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, outlook, occupancy, the amount by which the Company intends to reduce its real estate asset base, the expected amount of gross proceeds from the sale of such assets, and the anticipated timeframe for such asset dispositions, the number of properties we expect to open in the future, pace and booking trends, the amount and timing of company share repurchases, RevPAR trends, our 2024 outlook, including our expected System-Wide RevPAR, Net Rooms Growth, Net Income, Management, Franchise, License, and Other Fees, Adjusted SG&A expense, Adjusted EBITDA, Net Deferrals, Net Financed Contracts, Capital Expenditures, Free Cash Flow, and Capital Return to Shareholders, and our anticipated financial performance, prospects or future events and which 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, but are not limited to: general economic uncertainty in key global markets and a worsening of global economic conditions or low levels of economic growth; the rate and pace of economic recovery following economic downturns; global supply chain constraints and interruptions, rising costs of construction-related labor and materials, and increases in costs due to inflation or other factors that may not be fully offset by increases in revenues in our business; risks affecting the luxury, resort, and all-inclusive lodging segments; levels of spending in business, leisure, and group segments, as well as consumer confidence; declines in occupancy and average daily rate; limited visibility with respect to future bookings; loss of key personnel; domestic and international political and geopolitical conditions, including political or civil unrest or changes in trade policy; hostilities, or fear of hostilities, including future terrorist attacks, that affect travel; travel-related accidents; natural or man-made disasters, weather and climate-related events, such as earthquakes, tsunamis, tornadoes, hurricanes, droughts, floods, wildfires, oil spills, nuclear incidents, and global outbreaks of pandemics or contagious diseases, or fear of such outbreaks; our ability to successfully achieve certain levels of operating profits at hotels that have performance tests or guarantees in favor of our third-party owners; the impact of hotel renovations and redevelopments; risks associated with our capital allocation plans, share repurchase program, and dividend payments, including a reduction in, or elimination or suspension of, repurchase activity or dividend payments; the seasonal and cyclical nature of the real estate and hospitality businesses; changes in distribution arrangements, such as through internet travel intermediaries; changes in the tastes and preferences of our customers; relationships with colleagues and labor unions and changes in labor laws; the financial condition of, and our relationships with, third-party owners, franchisees, and hospitality venture partners; the possible inability of third-party owners, franchisees, or development partners to access the capital necessary to fund current operations or implement our plans for growth; risks associated with potential acquisitions and dispositions and our ability to successfully integrate completed acquisitions with existing operations; failure to successfully complete proposed transactions (including the failure to satisfy closing conditions or obtain required approvals); our ability to successfully execute our strategy to expand our management and hotels services and franchising business while at the same time reducing our real estate asset base within targeted timeframes and at expected values; our ability to maintain effective internal control over financial reporting and disclosure controls and procedures; declines in the value of our real estate assets; unforeseen terminations of our management and hotels services or franchise agreements; changes in federal, state, local, or foreign tax law; increases in interest rates, wages, and other operating costs; foreign exchange rate fluctuations or currency restructurings; risks associated with the introduction of new brand concepts, including lack of acceptance of new brands or innovation; general volatility of the capital markets and our ability to access such markets; changes in the competitive environment in our industry, industry consolidation, and the markets where we operate; our ability to successfully grow the World of Hyatt loyalty program and
Non-GAAP Financial Measures
The Company refers to certain financial measures that are not recognized in accordance with accounting principles generally accepted in
Availability of Information on Hyatt's Website and Social Media Channels
Investors and others should note that Hyatt routinely announces material information to investors and the marketplace using
About
Refer to the tables beginning with schedule A-11 for a summary of special items impacting Adjusted net income and Adjusted diluted earnings per share in the three months and year ended
Note: All RevPAR and ADR percentage changes are in constant dollars. This release includes references to non-GAAP financial measures. Refer to the non-GAAP reconciliations included in the schedules and the definitions of the non-GAAP measures presented beginning with schedule A-9.
Tag: HHC-FIN
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