Hilton Worldwide (HLT) 9 Feb 232022 Q4 Earnings call transcript

Good morning, and welcome to the Hilton Fourth Quarter and Full Year 2022 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] Please note, this event is being recorded.

I would now like to turn the conference over to Jill Slattery Chapman, Senior Vice President, Investor Relations and Corporate Development.

You may begin.

Chad. you, Thank fourth Hilton’s full XXXX year Welcome quarter call. earnings to and

could to we to include these that results statements those made begin, our and we obligation only as forward-looking remind in forward-looking materially the indicated statements. would Actual today will Before no forward-looking morning of revise like you today. update statements, undertake from or this our statements. to speak differ expectations discussions We

results factors a recently please to of first actual of could For section filed most XX-Q. and differ, the the our that Factors discussion XX-K Risk quarter see XXXX cause some of Form

we addition, will this on certain In non-GAAP financial measures refer to call.

and GAAP can measures our today’s discussed on reconciliations at in release in our ir.hilton.com. non-GAAP You website find to financial call, press of earnings

Chris Officer our then operating the environment an our and Officer, Chief This our and year. results Jacobs, President, and Financial expectations will and and President Global current for discuss Executive review our overview the the morning, fourth will Nassetta, quarter Chief full of year Kevin Company’s outlook. provide Development,

be to Following we’ll happy results, take your their questions.

With the pleased to to over I’m call that, Chris. turn

everyone, Jill. today. joining for Thank Good and us you, morning, thanks

continued end through and report recovery the growth. to year and deep times experienced members, are most We’re happy world. Together into our throughout team of challenging communities, another our a the strong with navigated of owners we’ve industry has

enabling to across disciplined network and and enhance serve approach guests’ to even partnerships guests During for to committed and to stay the needs more meet our they and any We destinations members innovations our to for further continued guests reliable friendly occasion through that value owners. new we delivering proposition may strengthen Honors our Hilton experiences year, continue in more strategic investing and and us evolving have. our development, remain we

more basis and year of for EPS up levels. Both with drove system-wide X% EBITDA shy Strong XX.X% adjusted and margins strategy expectations peaks XXXX of XXX of full and billion XXXX generate levels. year-over-year and more prior more flow and for XXXX history the to our than the XX%, approximately basis XXX margins than strong with points shareholders us and $X.X year. RevPAR higher than points to in surpassed up highest performance returned levels our Our free enabled over cash results versus roughly the

exceeding Turning RevPAR System-wide improving business leisure, to transient grew the exceeding reached just levels. continued performance year-over-year with the compared levels. segments results quarter. third We of all increased progression the to occupancy and peak Overall XXXX versus and XXXX with XX.X% expectations. up all shy X.X% quarter. XXXX saw all remained RevPAR with segments for sequentially across XX%, versus from increasing System-wide group and robust, X third rates XX% prior quarter points

quarter, throughout improve, saw leisure industries our segment, quarter expected, the segment in nearly transient third the XX% trends roughly of for recovery RevPAR X% and accounting continued of quarter. As remained business travel approximately our ahead strong XXXX and demand part businesses surpassing to Business continued transient with performance. and to travel important resiliency. business all Small up growing versus mix our of XXXX, enhancing prior medium-sized compared an leisure up to to also drive RevPAR levels continued modestly XXXX. high-teens with compared the rates by remained XX%, Strong overall

the third to RevPAR levels, and XXXX quarter. Group occupancy by the points performance versus than improving biggest both meetings gains. Company quarter-over-quarter fully improvement more X recovering driven saw with ADR boosted

year the macroeconomic to uncertainty XXXX. look line top system-wide we we to ahead, X% versus acknowledging expect growth X% As of

recover. markets easy first due recovery growth and segments continues as aided by across by growth continued U.S. to Omicron, to all and urban in Asia driven We expect performance to comps solid group meaningful quarter business be in

mix, Comprising with greatest of is visibility. roughly segment our group XX% normalized the a

For XXXX, year, their the versus strong with bookings, meetings as still to back teams organizations robust group demand rising with levels. back remains bring Even nearly helped is by company XX% forward XX% and more pipeline last than XXXX for year-over-year tentative up position bookings up together.

bookings in highs. lead digits new for the pricing is Additionally, double were January up at in low volumes all-time and

Turning to the development side.

to continue to deliver We our commitment on capital-light growth.

we’ve XX,XXX year, celebrated and X,XXXth our transaction hotel doubled hotel. totaling nearly years Since more our our For a full day, the size added the of opening XX rooms of we a the more ago, go-private system. than than

the up larger. XXX%, nearly our times is X.X in are rooms U.S. Our now and international portfolio

brands. more pipeline our did than added system, support. of XX all key than in more not brands or XX% we’ve of of any acquisitions deals current portfolio doubling any achieved financial have and other our new money We our Additionally, to the without this

In Garden we XX,XXXth Inn CALA hotel Japan. XXXth in celebrated DoubleTree in Hilton our the our of hotel opening our fourth Suites Asia in room, quarter, including Pacific, the our room, first HomeX XXX,XXXth XXXth and

pipeline throughout more X% all under in more for starts starts year, continued the competitors. With We U.S., saw have than now rooms year. increased also construction of starts XXXX. construction full major to XX,XXX a the to net We record strength of under X% than rooms, In in the X% versus next than the leading X.X% confident rooms more the over return growth couple remain to of half ability unit year to of our to which than construction, growth expect of X% we net and years. XXX,XXX more are for unit

accessible brand, continues our more Hilton, us to creating across at touches, development to last stay lodging guests effect and we more signature comfortable delivers filling stay network product Spark on a serve our that our the strategy reliable occasion. and guests the enhance by commitment, for enables provides practical price. of open any even Building this service value-driven to destinations industry consistent launched more an with and and disciplined newest Our a month, amenities option unexpected in friendly a Spark economy simple, premium and space new an needs owners. meet by

a XX large alone, U.S. brand in the totaling we streamlined Premium cost-effective for plan, of offers and annually have This million represents brand reinvestment to which, elements tailored had a guest on which a economy focused all growing not date, deals nearly conversions travelers, of leverage segment XXX conversion network than to effect. engines commercial our industry-leading in more negotiation, and powerful stages various serve. we almost third parties. and owners all have from To are core of enables

Additionally, and Hilton-branded the we’ve its identified no U.S. to opportunity great expand more the markets with providing for than XXX products, presence. brand a Company

fourth of members occupancy fastest-growing and strength the hotel the to with of loyalty Honors in XX% and year-over-year remains of customer-focused testament success XXX XXXX. line the basis for up a strategy, approximately than surpassed quarter, roughly XXX system our continued during our our million quarter the members Honors accounted more and program. points Hilton As in

to XXX million pre-pandemic levels. our year, properties during approximately peak Additionally, the exceeding we welcomed guests

remain serve. on ensuring has We a focused impact Hilton communities positive the we on

America consecutive were were Indices, for and the consecutive both Places for year, the World’s Jones performance. North Dow year, we Fortune most For on the by ranked to prestigious among ranking the we Place to seventh World Work. Great Best included sixth the Sustainability corporate sustainability And and Work

are of comes we members have work demonstrates, our discipline, incredibly for As we hard well And can whatever handle that future. our team positioned the our our way. and because proven performance

in ever pivotal and opportunities poised a And that to new travel. team and deliver with age is XXXX moment golden confident ahead our a we’re of great beyond. We’re than at more

over a to the to bit and for the year. the turn Kevin I’ll Now, give more call little the quarter on expectations detail full

morning, good and Chris, Thanks, everyone.

as to During the travel. compared basis XXXX. over recovery transient steady Growth the prior comparable by in and and well increased Strength group driven neutral results. XX.X% travel X.X% quarter, season currency benefited RevPAR strength continued system-wide the grew versus holiday a business year also and as in on leisure was

the year-over-year exceeding guidance in the range. by ownership high as subsidies, Adjusted up roughly $XX quarter, particularly Middle East, well million was COVID-related as in better-than-expected XX% the EBITDA which fee was Outperformance benefited end our and fourth Europe in $XXX Americas, growth, our portfolio. government driven million the of and

in by discipline ownership. grew franchise Japan Good results. further to in Management contributed RevPAR year-over-year, performance improvement. cost October strong borders reopening in Recovery benefited continued driven and also fees XX% following

quarter, range. fourth earnings increasing items diluted and $X.XX, high exceeding per the special share for XXX% year-over-year end guidance our the For adjusted was of

comparable ‘XX, RevPAR and strong X% improvement showed by business group XXXX. transient regional RevPAR levels strong increased compared XXXX first time recovered and above in driven versus to the occupancy All leisure segments performance. pandemic Turning the quarter by with continued quarter-over-quarter began, demand. rate. for performance peak year-over-year U.S. Both to to led continuing since our recovery to grew as XX% three Fourth be and

properties in increased In demand U.S., Performance over and year-over-year the strength strong versus season, XX% leisure from the particularly XXXX. XX% international fourth particularly in resort levels. peak XX% driven and the the at over demand from RevPAR travel up Europe, inbound holiday year-over-year XX% Performance outside In U.S. XX% grew Americas recovery RevPAR quarter leisure travel, by XXXX. of where benefited continued versus was RevPAR and versus was

In Middle East and travel RevPAR region, international Pacific the quarter-over-quarter XXXX, during World year-over-year XX% In was region a RevPAR and back in new XXXX. cases. the surge a versus XX% as RevPAR in step China Africa fourth loosening increased restrictions was up Cup inbound and the Asia year-over-year XX% compared down region, of benefited travel from XX% to XX% led COVID taking to The quarter Qatar. down versus XXXX.

rising but borders remains up volatile Japan rest throughout the following Demand Performance of with Asia term China, The is expected driven strength largely significant to X% XXXX. region by Pacific recover to infections. versus saw year, in excluding RevPAR, gradually due was improvement the reopening. in near the

Turning to development.

grew year-over-year, And nearly X.X%, rooms, fourth the for for XXXX and expected, of openings gross those largely year, of than openings. more year. U.S. China, units located XX% due accounted roughly our Conversions additionally, environment half under net XXX,XXX with in the the our we COVID outside on weighed construction. than the at XX% For which pipeline modestly ending to full lower grew quarter ongoing

U.S. encouraged the the Hilton-branded near-term the are year robust markets. products macroeconomic for international to ahead, uncertainty, we in both by despite Looking the and demand

unit and XXXX, full of growth expect we between X% For X.X%. year net

amendment to to the under revolving we facility the borrowing credit to Turning the the capacity to completed and facility sheet. January, maturity balance extend an $X our In increase billion to XXXX.

As our financial flexibility. we we and to liquidity of remain strength in position ahead, the look continue confident

guidance. to Moving

XX% first growth system-wide For to be year-over-year. and the we between expect quarter, XX% RevPAR

million, $XXX items between special expect and and be $X.XX. million diluted adjusted $XXX of for and to EBITDA adjusted between EPS $X.XX We

X%. EBITDA XXXX, of for future $X.XX. of do repurchases. growth $X.X share adjusted and full between our note between adjusted expect For special diluted EPS forecast We that forecast and incorporate billion year billion. not $X.X Please X% RevPAR we $X.XX and between We guidance ranges items

a $XXX for a the capital dividends quarter during fourth of to on of dividend return. cash for paid total the in Moving We share per $X.XX million year.

shareholders to the buybacks and quarter, billion full year authorized Board our form share. per $X.X in XXXX, returned quarterly For the we $X.XX first cash more than a dividends. In of of dividend

billion For return the year, billion the $X.X and full buybacks $X.X of we to between in form shareholders to dividends. expect and

Further would as prepared many remarks. any details in one found issued fourth you of and on questions as year completes to possible, earlier yourself We our have. so that for This this our open like full ask results we earnings would limit morning. the we may question. release can like line quarter to be the with We you to you now speak

we can our please? have question, Chad, first

question go Bank. first Santarelli Please with Instructions] is Our Deutsche from [Operator Carlo ahead.

the obviously, And given guys. and in this as at of simply, wants does doesn’t more all for Kevin half you. whoever RevPAR, are you quarter the kind flow perspective? back the macro the a or least color to -- more the kind to it, the it half how there’s in a Chris, Hey, of you provided. of kind for relates and economy? out. it frame acknowledging thinking like, strength flattening look seasonality you it Thank of or guidance And less tackle guys first at the embedded or back looking you’re what’s could Could year, about less from you your thanks

you quarter -- listen, for can all, mean, see fourth of thanks the question. I the first in Yes.

I in across strength mind. that all the I really $XX,XXX good could fourth question the everybody’s segments. quarter, had think you mean, we see the on is

We’re drives relative continue, But early way quarter, first the in to But the XXXX, XXXX, we see we about from demand, it’s substance Omicron good the of mean, continue obviously, the The to what because supply that year. industry are muted. I things. versus ultimately a of that continue up quite is supply if in the of fundamentals very fundamentals to impact. point and feel in result. view, that’s strength the side

And lowest levels get our met very the market, biggest the using example, that more with currently fair of strong to equal continues our any is share. And demand. record, that be supply we the market, supply. have market, very low not for we seen. of We’re to which experiencing in weakening. Thankfully, as seen, -- levels overall U.S. than the an we’ve But

-- we any our of telltale There backing tailwinds. any is cyclical not driving like of have think sort haven’t We seen those of of and signs. up. What are I like major threats no sort of is some secular segments that

continue First, money. see shifting they’re consumers to how spending their you

they’re maybe exhibit less, So, they’re towards it A experience a side. continues of it, spending be shifted the experiences but spending on little to bit how where more sort

to people not The up. to traveling. international starting opening across are just U.S. see inbound People markets you’re world, the -- the but

We time. quarter, results. raged. in opening Asia saw a It up Japan strong had take happen fourth the that more bit Pacific We pretty fully. which is in will little

get what sort XX we that’s we ago is is through our benefit the immunity months But rapidly. of going full the to of that. with and China So, view went XX happening herd like. through quite obviously

in the but pent-up broader a On could second demand within leisure China big we side, have has you’re you’re there half terms some tailwind mean, year, the slowing down. of them that. to that segments. to argue expect, And going particularly travel the people And don’t be the lot a significant from already of across -- I all to it, of in continues of doing see been see have ground, uptick. we you the starting in

because shift in we the towards partly experiences, to as there. people think strength of -- see to mentioned, continue we I So, continue

my the business side And group to second crazy. people they the because finished still strong remarks, demand. very of and the On year of prepared and been groups, COVID the demand start biggest all last of the the demand, side, through Even the transient that of on in we got of starts as demand, half were I hit lots events. we like good pent-up really association growing second mentioned planning stuff, as half planning all They’ve comfortable, could them really year planning. this

think them in people pretty of survival, lot resilient. been which because Some I’ve need big that’s doing speaking resilient, events, without I is But group gone demand, have things of lately. the a happening. is pretty to that at they years for just do

of economics those good. demand are So, and are the really -- supply

what decel given that fair mean, a suggesting you To up. build I of X% flattening be very way we into be it? let’s specific, math. Carlo, and did question, a of sort you’re part range when to we’re X%, to honest, be or going we’ve because, it’s I of reason mean, the a

shut year. You last for saw in world was the down quarter. guidance first partly The first quarter the our

slow. year, wrong, just conservative second conditions that’s we’ve a be But economic So, of right have to issue. or tried we that comparability anticipated, the the see half macro you’ll

of will a of the this the plateauing recessionary related moderate that’s have to we built second assumed you to in numbers what what if think as So, describe we’ve suggested I be sort you were in And year environment we a have of half to it, second the what half we today. it categorize into in the year. would sort of

Chris. Thanks. helpful. then Great, follow-up. super one That’s just And

‘XX. into As you the likely think and for as obviously, kind mentioned, some of quarter, were about slated ‘XX fourth slipping you that projects guys

in year, you as or would As or than pertains think XX% it of that growth the ‘XX? you better, experienced higher to that it’s would percentage that lower is unit a conversion activity that XX% you this think

to bit couple although going tougher, conversions Carl, gets tougher reasons. a to loosening. different those for are construction, continue new the been higher. you of important has It little world I more as be Yes. a as conditionings One, it’s be think we mean know.

remarks, become And conversions Spark, brand. talked prepared So is then, even about we’ve conversion a more as important. in XXX% our

delivering year, we those. be we’ll of So, the introduced ton going there’s start end by don’t But a of to the think year. those this

And bit of so a higher that little drive level conversion. will

think we for probably way it, year. higher than higher we the don’t XX% specifically, the about that XX%, guide or So, say, but

be Joe from Morgan. question next Thank will from Greff you. ahead. JP Please go And the

about respect year’s So, I guidance on just basis? a to second half you talk pricing if in embedded to changes with could what’s this see, U.S. occupancy year-over-year Chris, the wanted and of

out. you because that going I’m Yes. about to range to -- hard you, believe range the be rate integrity. occupancy is flattens we anticipate higher gave least and be that throughout RevPAR get the levels, of year I sort don’t we’re directionally, mean, not highly a way we occupancy that even gets numbers XXXX and say, we way. of I think, think it specific because in But to would do at We back levels. the don’t will to the would giving it

of good U.S. -- about For continue least giving pricing filibuster question, power. coming demand both secular have no simply through market, off in I think we described all going But the in continue cyclical capacity pricing the we market. reasons and because do we my the and at allow we into believe U.S. to are in addition to have do really is that question that us the increases us there are have Carlo’s to to tailwinds will this year, power, these

would -- pricing say, We’re the you. numbers half in we’ve ranges the the to power is second to of year get assume modestly lower assuming that maybe we flattening or to in increasing, not that suggested it’s I even

the U.S. occupancy we a very second be sort than of recessionary terms spending a with we’ve the business that on on globally in patterns, some in business the level, everybody the are soft talked crash U.S. not is a help thinks, help Again, at if demand the some things bumpy side, with to assumed landing, of high demand categories better there landing But that structural group So, world -- may the about I the and pent-up in and environment business in travel. to certain moderate opportunities. of half. going

are And franchise as fees fees and RevPAR the over just of Kevin, versus the my Chris to as licensing about specifically or that RevPAR, Great. in not you as related the course timeshare, line royalty when about with the you that thinking do last year? how changes follow-up, think well this growth in year fees line, how think the or from coming grows you credit

historically look, last think, look I was those Joe, grown public, at were if XX%ish less this over report. still Yes. than or been so can year, right? when the you fees So, RevPAR volatile, up they years, that, the it’s very historically, few -- less not up they’ve for HGV although robustly. what is And something year

X%, environment rate I think in that’s -- normalized to a they than more slightly at should overall better of X% grow high grow they a RevPAR should the business.

a so fourth for although record than was credit spend, largely quarter on about card in And dependent the XXXX. and set full year, would it in spend program for our spend higher the even XX%

is grow it time, what’s going but over although that it little been well, world. be than be better program it RevPAR volatile a on doing should will -- been quite than the it’s So, given should in bit just less

from go from America. The next ahead. of question Shaun is Please Bank Kelley

the talk starts could new How of changed in little moving just we remains the set space? obviously, the dig the that projects. past investor So, kind you down been conversations could There’s construction as the I question interest the a lot Chris chain maybe a the the or environment to the deeper follow-up, that Kevin, for further is little how unpack development of into of premium for developers if has economy just into now or we your could talk, side. go about the with robust, China continue and right rate right of concern concern quarter? finance to and dig mean, economy? bit -- a outlook throughout get bit us. kind going scales did side, then, shifts hoping on overall maybe about ability from Spark. the of kind bit just you a of the about or Why And opportunity my in

Chris with Yes. start Shaun. little more trends cover it maybe Thanks. Spark of Sure, I’ll maybe a the off hand sort and construction to broadly to then bit.

but look, takes, available And what bit money think a of there’s they than the lot of plenty lot obviously, talking there’s is availability a a projects the rate and of right? the availability seen higher world. I So, you’ve about been. And had right for little are puts capital. environment of in rates still constrained, -- interest capital you’re and more

If that. capital in on local than what’s money regional about level going like going constraints terms what’s and the banks bank think things at at is the of and different you center on

still higher to right And than You costs been say develop construction and have as have. people higher at some hotel that’s maybe XX% and they terms then, we’ve environment by when in it talking about more in were headwinds gives about opens, as -- of the down. direction. the a in when we off would it but perform would than will that XXXX peaks it XX%, the otherwise moving the confidence they level of coming fundamental They’re hotel

So, forma their goes pro up.

was the offices world. of than the hotels the in open/impossible they in depends that U.S. to were and where put that’s in of up in end all not are on literally, only your at higher started occupancy before. difficult gave the last were it sort you year starts China to It -- really you was build closed. ended year the the because, into gonculator, it difficult of certificate you get why U.S. that Obviously, and the year So,

starts. in our why that’s same so, little of is That you saw softness going environment bit And a in on NUG.

been lot the to they’re optimism. cases, it, in starts China, can world better absorb roll are hotel, a will The from the thinking hopefully, we they the way But and think can of continue of perform will that when starts the their all in will does when cost not give And they into absorb, about going a here. a build a thinking to then place be their So, more construction setup that in they be they little developers but loan loan bit permanent it if environment behind. better you’re a have normalized. fundamental construction cases and open loan, in higher rate

of the So, of on in and the going takes world. puts those are sort what’s of some

Yes, supporting talk and than point, I’ll they hotels would When our that, are Spark. our XXXX. making more individual money. talk making about to this majority more peak the money at say of we Each are system of I owners, were at the

the driving trend a flow see up And saw So, that. making the local year, go And half in. you why where higher and around producing we and helped is of are is the trend regional that’s good saw reversing has in optimism. money point to U.S. obviously, has, And context inflection as And starts the the they got reason free money efficiencies, as we have bulk that -- margins, many portfolio the they’re in rate that think world. the they’ve don’t at of we generally that here itself. -- is them an decades-long said, more pricing relationships. anything second in suggests started and that’s Kevin ever this and finding integrity more they’re quite business cash the power than is the it But of

a for I’ve had the On portfolio. the We time. at Spark, almost a long, listen, long thinking Company. we the truth of this lot We spent space lot been is -- of entire about -- time in the time, brand our size have we obviously, doubled we’ve a something been

to and the doing it So customer ago so, look it’s are customers, like, at if up are we it’s arguably the you that we’ve and very with better I building years sooner to it’s the opportunity than that you not base, important three also least entered been sitting to or lives serve customers, do off look because customers travel acquire big but their better base other had new nothing. think, and started customer you opportunity or are. more customer existing We And them a grow that to around loyalty an like early get them, at zone. base, huge at not our half that of But a going into probably, in half, things. system that say,

effect when network build network a customer always, as for sort our brands, starts we -- So, to of acquisition base. a a customer at look it continuing existing with and the

confident so we performance there you that that So, it we competition. was our the when point apply we Then lot if from to it part reliable, superior same comes for great, to point that we of engineer at that to three we us the out will, do be started that really that have in experience reasons about friendly, serious that at other ago the something looking a trying brands drive we with is were community magic, figure works, they hard have to going consistent and years can price commercial our view of this ownership a how be it. to customers, works our of meaning

it reason will a out. done think be because time we I in and spent of the very thing because tell, say, most figured And on we but disruption. so, easy, not we terms it’s will ripe three disruptive would for brand it space we’ve this it there’s years is

high you in this hotels If at a very physical situation you of beta segment, terms will this in attributes. at price find look the go point

to very out there. big already hard you when that’s And have system it’s a fix

as real a comes teams in that XXX% over built in we we figure our say, system space is the refreshed, -- about single we in of team, engineer in luxury. our what sexy different? Is frankly, be it as the not in has in at point this properties. few hotel, And company different I last product of it But brought the a dollars terms I’m supply the of is we I customer all to else and It’s say, consistent why, this sexy, you’d teams, anything lobbies. of else built and But And lifestyle that is and view, brand rooms, about so, in this does it put market opportunity customer-facing. been why shareholders, to a the not We hotels, in of the this the price it, from we as with want? billions customers It built these not the everybody we is going worried and time excited exist well, retrofit company, we’ve this this conversion. when mean years everything will because not did high-quality, as I’m of we management experience it what it’s you done is an them with what for am can contributor all point conversion. out about are engineered with So, give the how value its where this way this because every a we’ve be our okay? design to

and better get in the importantly, customers it We how think customers. number be thousands code. Europe. And ultimately -- it best will is some brand will return. do of take can that said, segment have segment in thousands And do serving I it but And most biggest always the acquiring this existing -- time, quickly. starts it’s will It’s will happen it be It way we terms for be, it biggest new of the mean, time, have the units. what we with should U.S. in superior biggest I the as over cracked in owners we a a our

come We life it. prove quickly. to quite will to It have will

a opportunities impact. a as open scale, as to at Kevin about next being to consumer won’t I And able dollars checks too will worth company deployed have it as think this we said, And opportunity to year into on terribly these think beyond, ultimately, As to will we of be think billions at a product globally have this numbers. deployed impact Sparks of our this those But year, be said, -- all look I the is branded year’s big as and new have I meaningful shareholders. our scale, get and we have a at boxes.

excited. So, we’re super

point, this we’ve point. hope of work. the given dust all out the this this this at ashes is the done good I that We’ve nervous. XXth out at not of tenth pretty proven We’re or the brand created we’ve we’re or at that

Please The next from Smedes go from is ahead. Citi. question Rose

wanted just portfolio. ask owned bit the and leased on a to you I little

think, of mentioned quarter. I this thinking XXXX, through start how all point, you just are just to should or I And are go million subsidies, dissipate of assume think or wondering, we during about COVID-related gone as we I was you just at the that? they $XX that those kind

Yes.

been not Europe. based amount. the continue -- overall out, if thing we’re had rate but that the on a I as we that I little very through if to approved if more come, based small on pull come you look on we in programs yet, sort quite And if remember, think have grow at And in quite there’s I it’s for would things been business And the bit has the portfolio at it mean, will knows, this who come than because XXXX far any. all thus growth normalized to say through subsidies that will a is expecting year. a higher that dramatic. basis, a of through played think well, anything maybe that we’ve you more haven’t

we -- key just Any pipeline, is or touch and lend you. happening And wondering the then, in Thank Chris, developers the thinking money potentially you change there. to share order what’s see or...? could to mentioned point, this way all Great. Hilton in maintain grow if I’m just you that about U.S. at using or on

No, no.

my pipeline, of if support. more it As whole financial has than money, I commented look remarks, key and XX% no the at on you prepared no in

changed that. our on view not have We

last dollars actually, at some in aggregate to we’re couple If what things and CapEx, what you year quarters. last out this year, thought look would happening we than peeled it’s last of year spending money, happen key everybody this in suggesting you that because are year if the had over the together lower you been average we’ve we actually and

and don’t we return, would together, way. our is and grow us very performing use So in get in brands individual and the you it it no, Everybody balance people I our highest strong investing that as a of and our are doing is aggregate opportunity view continuing brands overall, by the -- that of to driven them brands But when without what ultimately invest segments. the in to is. with to guess portfolio still sheet to are you want

no, way long-winded we saying, of a So, don’t anything. see

In very blew down, bit on a those on. this. fact, -- looking a and things trend we’ve with aggregate up, those over fewer were have together so able the deals years, But are line to a elevated in working in came time COVID, line some trend runs in bunch But we to of last agrees us lumpy going couple I things for working dollars at sweep during And Kevin, those he been lumpy, of moment of key think the be I overall strategic had too, we’re meaning were a but of there other opportunities key money is time. the development, we in at because people’s make or think I’m on lumpy money, long little sure he some things. always we’ve

-- think the is So, up. an years, next sense over I I few down, think the line not honestly, aggregate in trend dollar

Jefferies. comes Please Katz question go ahead. David from next from The

set the Just necessarily following talk together? that going about into discussions how could up a returns of And or guidance. in is that about of thoughtful And you view what that guidance kind is capital bit on pulling down baked the some up? the we thought number about the forward? a the how of just conservatism firm Could and push earlier

given help yes, without to that, number. assume can’t I it’s say wouldn’t to a but goes We myself. have have that you. I it David, saying, firm Yes. I

number. for now, There’s we It’s yes, lot So left of range a a could as That’s lot a a reason. it’s what think. happen. a firm of and year

-- borrowing assume no for we the does very the like lower That this. higher of did environment historic range effectively to. now, choppy. we range don’t than that think now. we’re your note borrowing than where read bit the and little you’re year leverage. I borrowing It’s a used Right I because morning, think so with know our Rates going I I -- think this if right are we

-- EBITDA what stays that and And return, And leverage cash what business. much bit and the dividend roughly don’t high of down of talking slightly with capital than money capital, buybacks. -- pay flat to for year. very And and the bit will don’t range little do free again, assumes of that’s what a for we so, guidance out that were money than small recognizing spit a it yes, do use a about we key other else that’s little the flow and we that other with just we’re a for

so, the now. range And for that’s

wholeheartedly. our of the thing thing only agree haven’t of would that on to would longer-range I The sheet that The I add Yes. and I not balance capital is all only views -- return add that’s changed. --

very We since want time. beginning we saying been be like of have It consistent X times. X.X the feels to to

We range They’ll Kevin described. We’re think at below bit below the low of debt the just the -- get end or reasons are little choppy. end markets better. for a the low

we intermediate leverage run to the longer term, at don’t those Over levels. intend and

that been range, little -- the it towards need -- that calls, looking in in consider. to we’re frankly, even a that’s just just said the -- these is ranges, and end asked something in said more be the and environment beyond would bit on we debt a markets. or the we’ve We many would high times probably we’ve We stability would of certainly intend more publicly, normalized we for

question we lot And money, Kevin the answer need. which need have said, think in in use key we as CapEx, obviously, commented we don’t my don’t more. is And I the whole of to primary the earlier on as terms a

opportunity or up, affords any this the obviously, any more borrowing, re-leveraging us capital. return even to So, leveraging

will So, think I gave macro forward. -- now, exist. We will the those the of right and we’ll and sort debt you we going how think markets see there opportunities how what broadly shifts

will I well -- away talk new question. mean what I that. brand is and And come say. competitors, notion we into space Am proposition I you yourself Can where the about received a believe appreciate aren’t compete? the since up that there we my or just fitting taking direct with are better from are bit? misspoken necessarily you just everything a you’ve know a there value that I

still do if a we’re We’ve be existing the the of true, probably average, it any called premium in you a in up it if folks say there would above, XX% most mean, company. of we plus above look we job, like That’s don’t going segment. we come I do, segment be sort real our to like are. competitors. we’re think meaning branding would or I why, We on will that, are made economy. to minus where below which

strength So, be loyalty space. quality, will consistent our view would those be it the economy of price both more will because system commercial better, above, our it a above but higher is all importantly, our things, engines, product. traditional because system, the It of and

question from go next The Farley from ahead. is Please UBS. Robin

of lower pricing or year. sort lower? actually follow-up power were flatten you lower saying My like both power just earlier the Just your even are that modestly in clarifications rate be modestly in or you to clarify, were guidance, clarify. really increase wanted rate and I of the some question assuming on would you comment. Chris, later actually said pricing to

Not rates actually lowered.

half basically, the relative Just plateauing of year. ‘XX to second in the

on Perfect. are mentioned have about… a Thank would you to there or not sort in then -- your you even time just expect you XXXX. that be view XXXX, to of assuming you. do a you’re back matter getting Okay. that that’s I’m really and And occupancy of occupancy, guidance, you by

our But pricing could and up. of strategies. as because rates don’t be by occupancy our in we get on manage growth, levels degree, way, part. to cycle, we really to a actually driven think to the get rate case, Yes. But I ourselves particularly we honestly, with think mean best we the I bit see for -- trying jump We back there if the a by that could this can -- want we conservatism may in wanted. environment, we results drive else, bottom everything can Robin, you this that. given do I we occupy are effectively it tomorrow line the to inflation our are owners, do manage,

and -- it more still pent-up the more group Some there demand, segment. recovery business of think I particularly is and Okay? travel is

doesn’t. So, above not I to will. to we where pricing that will it been for ownership margins continue I in recorded next go believe we I to occupancy rate more community. so have kind if And a drive year. able profitability it we our I’m level, happens be of and think we of never continue aware prior hope this I power, happen higher absolutely hope year there’s thus that Honestly, and cycle may history that that It

your in comment the some past then year pushed a were you comment clarification QX on Great. the coming just that in other openings China would sort maybe release, make I COVID in understood of just delays that about in guidance. X% the the full in kind From your sort December it of under China my number. And starts guess, sort unit XX in net made of was of maybe China then ahead But of that opening then I behind. being of comments, the the

behind? some guess, weeks also China broader So or on I openings delayed by whether issue get unit the wanted clarification it are growth sort a few with if a just to of was just starts I in

reopen when broadly a activity. is then and gets reopen was both, quarter it’s it’s in because sick, drag a has also starts now think -- they is drag it is both the everybody on created they the on a comes lockdown, creating the created business net activity business drag it’s a and drag environment mean, I openings -- -- I the result Robin. on but fourth and just before

you think we hotel were it’s So said open can’t We that completed opens it. environment China. earlier if Q&A, a where And get quarterly We there in was a an long-term in significant give guidance. we it a have by signing definition, can’t as don’t literally occupancy, don’t because of think the if you affected trend timing. all by yes, -- it’s starts I and

assume open. they’re not into to when going hotels you can But open those to we’re like going think delay. get So, going are a to I on

is from Please from Richard question Bernstein. next go Clarke ahead. The

give one release, more number, observed that particular what Is is pressure pricing And I recovery? which is, year-on-year maybe some at has I guess, and you further hotels you there recovered strategy a been? seem I the your any on little a is if through at pricing long find the your than stare for broadly mix? maybe Astoria. that pricing, bit or bit Waldorf peers seeing, And to I your enough that guess taken is pricing to of buttons have does little less what occupancies you’re a Would the pricing on down match few compress negative I quicker. more high-end

Yes.

-- First of no driven by all that’s on Waldorf, hotels. there’s individual

markets Just the or Waldorf in dynamic brand, it. unlike hotels our drive one other brands, particular market that will many so one two there’s not

see not to we’re -- second that continuing -- To in no to seeing part slowdown we’re see we’re to K.J. of dish continuing strength. contrary, I’ll the there’s the So, luxury. great broadly

with I’m the sorry, going second I’m maybe you didn’t bit on I where Rich, I’m Yes. part. were not little of a sorry. fully -- that. clarification understanding

closest of Sure. peers. in I strategy? bit that your increased little prices some the peers, I look your less occupancies market, seems some pricing quicker your of you’ve guess, relative to line it Is a relative with to when at some than sort and recovered than peers your

No.

outcomes than competitors. we’re So, driving up is board, our share market right? Our across the better revenue

may sort at competitors individual don’t of spot you’re for You our or be We’d individual. of to… rates in looking looking be happy terms year-on-year. know what at I

we last in highest our we occupancy. levels in and finished The the to system-wide both share in -- and at share rate history, simplest way gained year, look

those that across -- but the numbers So theory. would support system not

through just have maybe that And year. quick size the a pass-through the adjustment the franchise, expenses other and from reasonable managed net of The the negative costs follow-up. Okay. in been rest

COVID. through you’re back maybe like Looking of losses some clawing the

some program in So, the pivoted other just that there’s wondering way QX? that’s if specific

and the of to of seeing run always on you’re time, various over are issues P&L. all items. In going timing timing and breakeven have just revenue end, in our programs the those There’s line funds we No. then issues terms and

Chad from from Beynon question next ahead. is go Please The Macquarie.

labor very we that to in travel in category to about wanted from the reporting. tight strong the terms -- I hear Fed’s lodging. continue on the of and Obviously, ask experiential market about the

in has and how they then you’re your profits kind partners, IMFs kind of do believe if when this of labor year Thanks. thinking What are terms of hasn’t? the factor peaked builders? the talk in into does So, about just of to it back half your that how the saying And you you market? secondarily,

the labor mean, market situation eased has I a lot. Yes.

I beyond hotels I our -- So franchise employ people. as talk a we of to lot mean, talk lot to talk community. of our operate team, listen, We we because to a that, but

terms would getting say close. we that but to are we’re to of access fully we think in broadly, back were I they labor, not where awfully

And so, as a talking X. quite a topical, it’s which it every we scale is conversation, a ago XX on was I of if X to year the it XX about a single every day, in was good X of not extremis, or and terms were something it is indication. mean,

easing. So, is I labor the think situation

retail, Fed was also see it layoffs, a across what through retail where be people is and to through other including, broad thinking staffed up notwithstanding industries, of course, COVID technology, of but really lot maintained continue banking, demand the going that saying, of had You to hasn’t. through universe a the

back that getting into -- are to that’s we out there a market, the are and so, get allowing pushed the that affording the people labor need. And job us opportunity of lot

big while seen, continuing. ‘XX has those of stabilize. They’re at are but to And not level to also rate rates seen you’ve kind COVID, start absolute substantially. now, wage that -- up increase level, net-net increases a during higher the You’ve diminished lot went from a of the

terms IMF, IMF. good we feel In we about about of how think

the expect year IMF I get rate. year, add ‘XX. it to of to the we think high will watermark growth think this We prior over our for that significantly we expect

that a are feeds impact the secondly, as then slightly just weakened And what in into basket guidance, then operational a thinking dollar a of the you dollar terms has weaker an little there kind just is with in And impact that? you the Great. saw bit currencies. about translational kind of from ‘XX? also, of FX, non-U.S. against of versus How

this numbers. labor Operationally, obviously, a in currencies. it where small millions has pricing headwind of market those in It’s effects very in each year’s single-digit dollars headwind your individual

is James. Raymond The Bill Please from from next question go Crow ahead.

the of to how that the that leisure about talked be strength how to when your for this You leisure year. quarter demand concern the all there’s below But think in year, RevPAR and you growth it’s fourth about lot be X% a would range, going leisure X% would that? that year, -- of last of or would significantly in

Yes.

I be within do it range. think think that we would

the see do all will very the see like to of have number, year. of consumers slower looked trillion. We savings here noise and go that the back in result feel still strength. if The the about lot half now still expect COVID as are went some in really month continue -- out at strong. you to the we macro a But plateauing relative demand just of segments before while And there’s there, trends good incremental second it. $X.X a the back a and of U.S. you We environment

$X.X $X.X like at trillion. peaked down that so -- trillion. to Now It’s

probably the getting spending are and reading they news nervous. and it, they’re So, and the papers watching more

is that we’re shifting time is the reason the because tell, will behavior back and think described spending. that so, it. they’re would we’re seeing earlier I it, of not of maybe they phenomena that little part that the set their a And reality not And say bit. a But seeing in pull okay, would is the be I call, which

of incremental of spending only their not So a overall at their still travel in as they’re good, but and lot do reasonably savings pockets and they spend. bars and restaurants more a have feel percentage it

there’ll expect we do so, those segments, the second a little half a like in year, leisure have the headwind be we in ranges. And anticipated, all to be bit of of but

years. of the is If of the service the the deferred industry? a address one one started it And of But Hampton hotels Does really Spark, two last follow-up that CapEx or care for age question of I on problems which what an there kind product. in obviously is are and other ‘XX ‘XX. could several out take my is lot over select intriguing

dealing years hotels on old. we’re up XX So, with coming

-- ultimately you’ve is process that is that hotels brand? So, that part thought could got there the of a a that within fit is of lot

don’t make Hampton older opinion, Listen, meaning we the you on products -- keeping other an in have sense it we’ve is at brand, Hampton, lodging, my like out properties by their been in margin, the for that the quite as percentage I fitting is we aren’t think in Hamptons and think if XX that brand in There third-party system. in strongest of the we past disciplined ancillary the years, benefit do that over certainly pushing those are the prime look system. next will some keeping there know,

Bill, are system. third-party that processing deals small of brands. are have will And the deals we in the overall now, I in-house we now think very of I it the at right a end, if look be the right percentage XX%

I lot there, say the few A few over in no But of we’ve exit to a in been and as Hilton but for margin. Hamptons But system are an there’s the are hotels, those there benefit there. are eternity. brands So, time, a doing on would it’s frankly, ancillary other time there going Hamptons.

from next The go Please Securities. from Scholes Patrick is Truist ahead. question

[Technical Difficulty]

you’re understand Hey Greg, you can’t -- saying. Your us? hear what we can

super connection Your garbled. is

apologize. I

have with the you. next we’ll our to Brandt move is So, to Thank next Montour Barclays. question. And question from on

me, just from Actually, and one Kevin. Chris

continuing better right, bit which bit to terms at couple in development have reopening of a to and of gotten for Chris, a were the a and of of to China three the and term months get sort more growth, terms U.S. over taken, your medium you, comments now, little The years. though, seems on since ago, is right, in starts So, net then well longer excitement Spark speed unit world better.

you potentially playing So months in little we run getting a three the maybe than I ‘XX? feel to X rate question are bit ago? NUG to X the did about late even do And for better back that guess, is, you hitting

for or but sort can be cagey we X%. I about the a one a other to in Look, Brandt, think there’s said of world. go the way it, said we what not lot reason, months ago feel I today don’t than X% We about to to that. I may differently I about a have feel Chris great did different view. still getting -- back three don’t

trends always the think right? change, way. stay mean, going come I a will these these I expect none think and we the -- world things we But bit. is coming our don’t is way world constant, of little our to

So, much in I don’t now. feel that three better months from

roles. felt I’m nature probably a it That’s Kevin. more about our we think optimistic feel by pretty no, we getting But to back I than quarter -- good ago.

get we’ve firma a either on the So look think view -- with terra U.S. it a little the where this we have in really call, -- or what And economy last like? recession we accomplished that people it changed. bit don’t certainty. hasn’t differently. more I does looks I were in I don’t on said agree And feel think asked sense the like we you

we happening. and back fully not that Then, while get reopened, got we China to it’s said okay, China, it’s And reopened.

margin, So had I better -- in we but you think we heads tell that. And Spark. about didn’t Spark, feel have on our we we the didn’t about

there, have our now think that provides, back we and little so, progress pun there. And spark Spark of I a no in to bit intended, getting

So, it ago. good about pretty we quarter felt a

I it think now. we feel pretty good about

over turn Ladies Nassetta would or session. our remarks. additional question-and-answer to the like to for any this and I closing back conference gentlemen, concludes Chris

Thank all us. for and thank you, you joining Chad,

fourth state numbers recovery, As hope we’re you you I with or imagine, would of can quarter pleased imagine -- great. are the the

the very the good appreciate business. think the another We and to first we and look While give appreciate now macro sidelines bookings and we’re the we catching We trends, forward We things we’re the good we year. all into in more advanced seeing into And business right support. that seeing you that up about have the sightlines we’re then. the time. have watching we’re really quarter to feel sentient to after what what with going everybody

and you, great have thank a So, day.

conference presentation. today’s you has The Thank now sir. you, attending thank And for concluded.

now may You disconnect.