Hyatt’s Q4 Earnings Beat Estimates

CHICAGO—Hyatt Hotels Corporation’s fourth quarter earnings results exceeded Wall Street expectations, with profit of $321 million, or $3.08 per diluted share compared to $44 million, or 40 cents per diluted share, in Q4 2018. The average estimate of nine analysts surveyed by Zacks Investment Research was for earnings of 20 cents per share.

Adjusted net income attributable to Hyatt was $49 million, or $0.47 per diluted share, in the fourth quarter of 2019, compared to $69 million, or $0.62 per diluted share, in the fourth quarter of 2018.

“We had a strong finish to the year, delivering nearly 12% growth in fee revenues and 7.4% net rooms growth, fueled by a record-setting 90 new hotels opened across our system in 2019,” said Mark S. Hoplamazian, president/CEO, Hyatt Hotels Corporation. “We ended the year with a material increase in the percentage of our earnings coming from our managed and franchise fee business. This was driven by consistent execution of our strategy to concurrently drive our organic growth and continue to reduce our holdings of hotel real estate at attractive valuations.”

Fourth quarter 2019 financial results as compared to fourth quarter 2018 are as follows:

  • Net income increased 621.5% to $321 million.
  • Adjusted EBITDA increased 5.3% to $191 million, up 5.7% in constant currency.
  • Comparable system-wide RevPAR decreased 0.5%, and was negatively impacted by approximately 110 basis points as a result of political unrest in Hong Kong, and by approximately 60 basis points from the timing of the Jewish holidays. RevPAR increased 1.4% at comparable owned and leased hotels.
  • Comparable U.S. hotel RevPAR decreased 1.3%; full-service and select-service U.S. hotel RevPAR decreased 1.1% and 1.8%, respectively.
  • Comparable owned and leased hotels operating margin was flat at 24.6%.
  • Adjusted EBITDA margin increased 100 basis points to 29.7% in constant currency.

Fiscal year 2019 financial results as compared to fiscal year 2018 are as follows:

  • Net income decreased 0.4% to $766 million.
  • Adjusted EBITDA decreased 2.9% to $754 million, down 2% in constant currency, reflecting significant transaction activity.
  • Comparable system-wide RevPAR increased 0.7%, including an increase of 1% at comparable owned and leased hotels. Comparable system-wide RevPAR growth was negatively impacted by approximately 40 basis points as a result of political unrest in Hong Kong.
  • Comparable U.S. hotel RevPAR decreased 0.6%; full-service U.S. hotel RevPAR was flat and select-service U.S. hotel RevPAR decreased 2%.
  • Comparable owned and leased hotels operating margin was flat at 24.2%.
  • Adjusted EBITDA margin decreased 170 basis points to 29.2% in constant currency.
  • Net rooms growth was 7.4% in 2019.
  • As of December 31, 2019, the company’s pipeline consisted of approximately 500 hotels, or approximately 101,000 rooms.
  • The company repurchased 5,621,281 shares of common stock for $421 million in 2019, compared to 12,723,895 shares for $966 million in 2018.

Hoplamazian continued, “We have successfully completed the integration of the Two Roads brands. We have had significant developer interest for these brands since acquisition, and expect these new brands to drive further growth in the future. We believe our pipeline supports sustainable growth over time, and in 2019, our pipeline expanded by over 13% to approximately 101,000 hotel rooms, equivalent to 45% of our global rooms portfolio open today.”

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