Hilton Worldwide Q2 Profit Rises, Lifts FY14 Earnings Forecast

(RTTNews) - Hilton Worldwide Holdings, Inc. (HLT) reported Friday higher profit in its second quarter, boosted by strong revenue results in all its segments. Further, the company hospitality firm lifted its forecast for fiscal 2014 earnings per share and adjusted EBITDA, a key earnings metric.

Hilton's second-quarter net income attributable to stockholders climbed 35 percent to $209 million, or $0.21 a share, from $155 million or $0.17 a share, last year.

On average, 21 analysts polled by Thomson Reuters expected earnings of $0.19 per share for the quarter. Analysts' estimates typically exclude one-time items.

Adjusted EBITDA increased more than 10 percent year-over-year to $651 million, and Adjusted EBITDA margin improved 110 basis points.

For the period, total revenues were $2.67 billion, compared with $2.38 billion, a year before. Street estimated revenues of $2.57 billion.

System-wide comparable RevPAR increased 6.7 percent on a currency neutral basis, and U.S. comparable RevPAR increased 7.3 percent.

In the quarter, management and franchise fees increased 14 percent. Excluding $3 million of affiliate management fees that are not comparable, management and franchise fees grew 13 percent. RevPAR at comparable managed and franchised hotels in the second quarter increased 6.8 percent on a reported basis, and 7 percent on a currency neutral basis.

Revenues from the ownership segment increased 4 percent, and RevPAR at comparable hotels in the ownership segment increased 5.9 percent on a reported basis.

Timeshare segment's revenues increased 6 percent, led by growth in revenue from resort operations.

Christopher Nassetta, president & chief executive officer, said, "We had another great quarter led by a 6.7 percent increase in system-wide RevPAR, and as a result, we are increasing our Adjusted EBITDA and EPS outlook for the year."

Looking ahead for the third quarter, Hilton expects adjusted earnings per share between $0.15 and $0.17, while analysts expect $0.17 per share. Adjusted EBITDA is expected to be between $610 million and $630 million, and system-wide RevPAR is expected to increase between 5.5 percent and 7 percent on a comparable and currency neutral basis.

Further, for fiscal 2014, the company now expects adjusted earnings per share between $0.67 and $0.70, and adjusted EBITDA between $2.425 billion and $2.475 billion.

The company previously projected adjusted earnings per share of $0.64 - $0.67, and adjusted EBITDA between $2.415 billion and $2.465 billion.

Analysts project earnings per share of $0.66 for the year.

Hilton continues to expect system-wide RevPAR to increase between 5.5 percent and 7 percent on a comparable and currency neutral basis.

Hilton shares settled Thursday's regular trading at $24.21, down 1.90 percent. In the after hours trading, shares gained 1.40 percent to $24.55.