Hilton to Discuss Three-Year Outlook for Financial Results, Unit Growth at 2006 Investor Day
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Hilton to Discuss Three-Year Outlook for Financial Results, Unit Growth at 2006 Investor Day
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Category: North America & West Indies / Carribean islands
This is a press release selected by our editorial committee and published online for free on 2006-12-15
Hilton Hotels Corporation (NYSE:HLT) will discuss with institutional investors and security analysts in New York today the company's earnings growth and global unit growth expectations through 2009.
Assuming compound annual RevPAR growth of 7 to 9 percent, the company anticipates Adjusted EBITDA to increase at a compounded annual growth rate of 11 to 14 percent through 2009; operating income to increase 12 to 17 percent, and recurring diluted earnings per share (EPS) to increase 16 to 22 percent.
Assuming a 9 percent compounded annual growth rate in RevPAR, the company anticipates diluted EPS would approximate $2.00 per share in 2009. Based on this assumption, Hilton would anticipate 2009 fees of $1.005 billion; profit from owned hotels of $980 million; profit from leased hotels of $600 million; timeshare profit of $235 million, and total company Adjusted EBITDA of $2.530 billion.
Assuming a 7 percent compounded annual growth rate in RevPAR, the company anticipates diluted EPS would approximate $1.70 per share in 2009, with fees of $980 million; owned profit of $870 million; leased profit of $515 million; timeshare profit of $235 million, and total company Adjusted EBITDA of $2.310 billion.
Consistent with its strategy of growing its franchise and management fee business and expanding development of its Family of Brands to markets around the world, the company said it anticipates adding approximately 120,000 rooms to its global system between 2007 and 2009, with a gradually increasing percentage of the room growth coming from international markets. The company recently announced deals for development of its Hilton full-service and mid-scale Hilton Garden Inn hotels in markets throughout India and China.
Hilton also reaffirmed the preliminary 2007 guidance it originally provided on its October 31, 2006 earnings call, specifically: management/franchise fee growth in the 15 percent range; pro forma comparable worldwide owned hotel RevPAR and margin growth of approximately 7 to 9 percent and 125 to 175 basis points, respectively; pro forma comparable worldwide leased hotel RevPAR and margin growth of approximately 4 to 5 percent and 30 to 70 basis points, respectively; and an effective tax rate of approximately 38 percent.
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