Hyatt Reports Third Quarter 2024 Results

Hyatt Hotels Corporation ("Hyatt" or the "Company") (NYSE: H) today reported third quarter 2024 results. Highlights include:

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Hyatt's Third Quarter 2024 Earnings Infographic

• Comparable system-wide hotels RevPAR increased 3.0% compared to the same period in 2023

• Comparable system-wide all-inclusive resorts Net Package RevPAR decreased 0.9% compared to the same period in 2023

• Net Rooms Growth was approximately 4.3%

• Net Income was $471 million and Adjusted Net Income was $96 million

• Diluted EPS was $4.63 and Adjusted Diluted EPS was $0.94

• Adjusted EBITDA was $275 million

• Pipeline of executed management or franchise contracts was approximately 135,000 rooms

• Repurchased approximately 4.5 million shares of Class A and Class B common stock for an aggregate purchase price of $657 million

• Full year comparable system-wide hotels RevPAR is projected to increase 3.0% to 4.0% on a constant currency basis compared to full year 2023

• Full year Net Income is projected between $1,400 million and $1,450 million

• Full year Adjusted EBITDA is projected between $1,100 million and $1,120 million

• Full year Capital Returns to Shareholders is projected to be approximately $1,250 million

Mark S. Hoplamazian, President and Chief Executive Officer of Hyatt, said, "We reported solid third quarter results, with gross fee revenues reaching $268 million. Our pipeline reached a new record of approximately 135,000 rooms, increasing 10% year-over-year, and World of Hyatt membership expanded to a record of 51 million members, growing a remarkable 22% year-over-year. Our operating results and capital allocation strategy, including the completion of our 2021 asset-disposition commitment, acquisition of Standard International, and planned joint venture transaction to manage Bahia Principe branded hotels and resorts, demonstrate the strength of our asset-light earnings model leading to the return of over $1.2 billion to shareholders through share repurchases and dividends so far this year."

Segment Results and Highlights

• Management and franchising: Results reflected strong business transient and group travel demand during the third quarter. In the United States, performance was driven by business transient and group travel while leisure was impacted by renovations, weather, and increased international outbound to Europe and Asia Pacific (excluding Greater China). In Europe, RevPAR increased 15% during the period, bolstered by the Summer Olympics in Paris. Greater China continued to experience meaningful international outbound travel to other markets within Asia, with RevPAR in Asia Pacific (excluding Greater China) up 10% during the quarter.
• Owned and leased: Adjusted EBITDA in the third quarter increased 13% compared to the third quarter of 2023, when adjusted for the net impact of transactions. Comparable margins increased 210 bps compared to the third quarter of 2023, led by strong ADR from the Democratic National Convention in Chicago and the Summer Olympics in Paris.
• Distribution: Results for the third quarter reflect more seasonal booking patterns compared to last year and the impact of Hurricanes Beryl and Helene, partially offset by Mr & Mrs Smith commissions and certain ALG Vacations travel credits. Excluding the impact of the UVC Transaction, Adjusted EBITDA decreased $5 million.

Openings and Development

In the third quarter, 16 new hotels (or 2,589 rooms) joined Hyatt's portfolio. Notable openings included Alila Shanghai, Brunfels Hotel, part of The Unbound Collection by Hyatt, Grand Hyatt Kunming, and Park Hyatt Marrakech. During the quarter, the Company announced its exclusive alliance with Under Canvas with 13 outdoor resorts, including ULUM Moab.

As of September 30, 2024, the Company had a pipeline of executed management or franchise contracts for approximately 690 hotels (approximately 135,000 rooms).

Transactions and Capital Strategy

As a result of the previously announced sale of Hyatt Regency Orlando and an adjacent undeveloped land parcel on August 16, 2024, the Company exceeded its $2 billion asset-disposition commitment announced in August 2021. The Company has realized $2.6 billion of gross proceeds, net of acquisitions, at a 13.3x multiple over the three-year period and expects to exceed 80% asset-light earnings mix in 2025.

Additionally, as previously announced, the Company closed on the acquisition of Standard International on October 1, 2024 for approximately $150 million with up to an additional $185 million of contingent consideration.

On October 28, 2024, the Company announced plans to enter into a long-term, asset-light joint venture with Grupo Piñero, investing €359 million at closing for 50% of the joint venture plus an additional €60 million when certain conditions are met (the "Bahia Principe Transaction"). This transaction is expected to close in the coming months subject to customary closing conditions, and upon closing, will add 23 all-inclusive resorts (or approximately 12,000 rooms) to Hyatt's managed portfolio.

Balance Sheet and Liquidity

As of September 30, 2024, the Company reported the following:

• Total debt of $3,142 million.
• Pro rata share of unconsolidated hospitality venture debt of $454 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 $2.6 billion with $1,134 million of cash and cash equivalents and short-term investments, and borrowing availability of $1,497 million under Hyatt's revolving credit facility, net of letters of credit outstanding.
• During the quarter, the Company repaid the outstanding balance on the $750 million of 1.800% senior notes due 2024 at maturity for approximately $753 million, inclusive of $7 million of accrued interest.

During the third quarter, the Company repurchased a total of 2,858,280 shares of Class A common stock for approximately $407 million and a total of 1,642,251 shares of Class B common stock for approximately $250 million. As of September 30, 2024, the Company has approximately $982 million remaining under the share repurchase authorization.

The Company's board of directors has declared a cash dividend of $0.15 per share for the fourth quarter of 2024. The dividend is payable on December 6, 2024 to Class A and Class B stockholders of record as of November 22, 2024.

2024 Outlook

The Company is providing the following updated outlook for the 2024 fiscal year:

Refer to the table on page A-7 of the schedules for a summary of special items impacting Adjusted Net Income and Adjusted Diluted EPS for the three months and nine months ended September 30, 2024.

Note: All RevPAR and ADR percentage changes are in constant dollars. All Net Package RevPAR and Net Package ADR percentage changes are in reported 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 on page A-5.

Conference Call Information

The Company will hold an investor conference call this morning, October 31, 2024, at 9:00 a.m. CT.

Participants are encouraged to 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 (U.S. Toll-Free) or 646.307.1963 (International Toll Number) using conference ID# 2303828 approximately 15 minutes prior to the scheduled start time.

A replay of the call will be available for one week beginning on Thursday, October 31, 2024, at 12:00 p.m. CT by dialing: 800.770.2030 (U.S. Toll-Free) or 609.800.9909 (International Toll Number) using conference ID# 2303828. An archive of the webcast will be available on the Company's website for 90 days.

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 number of properties we expect to open in the future, pace and booking trends, the expected timing and payment of dividends, RevPAR trends, our expected Adjusted G&A Expense, our expected capital expenditures, our expected net rooms growth, our expected system-wide RevPAR, our expected one-time integration-related expenses, financial performance, prospects or future events and 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 as a result of the U.S. presidential election, and 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 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 hotel services agreements 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 Unlimited Vacation Club paid membership program; cyber incidents and information technology failures; outcomes of legal or administrative proceedings; and violations of regulations or laws related to our franchising business and licensing businesses and our international operations; and other risks discussed in the Company's filings with the SEC, including our annual reports on Form 10-K and quarterly reports on Form 10-Q, which filings are available from the SEC. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth above. We caution you not to place undue reliance on any forward-looking statements, which are made only as of the date of this press release. We do not undertake or assume any obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by applicable law. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

Non-GAAP Financial Measures

The Company refers to certain financial measures that are not recognized under U.S. generally accepted accounting principles (GAAP) in this press release, including: Adjusted Net Income; Adjusted Diluted EPS; Adjusted EBITDA; Adjusted G&A Expenses; and Free Cash Flow. See the schedules to this earnings release, including the "Definitions" section, for additional information and reconciliations of such non-GAAP financial measures.

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 U.S. Securities and Exchange Commission (SEC) filings, press releases, public conference calls, webcasts and the Hyatt Investor Relations website. The Company uses these channels as well as social media channels (e.g., the Hyatt Facebook account (facebook.com/hyatt); the Hyatt Instagram account (instagram.com/hyatt/); the Hyatt X account (twitter.com/hyatt); the Hyatt LinkedIn account (linkedin.com/company/hyatt/); and the Hyatt YouTube account (youtube.com/user/hyatt)) as a means of disclosing information about the Company's business to our guests, customers, colleagues, investors, and the public. While not all of the information that the Company posts to the Hyatt Investor Relations website or on the Company's social media channels is of a material nature, some information could be deemed to be material. Accordingly, the Company encourages investors, the media, and others interested in Hyatt to review the information that it shares at the Investor Relations link located at the bottom of the page on hyatt.com and on the Company's social media channels. Users may automatically receive email alerts and other information about the Company when enrolling an email address by visiting "Investor Email Alerts" in the "Resources" section of Hyatt's website at investors.hyatt.com. The contents of these websites are not incorporated by reference into this press release or any report or document Hyatt files with the SEC, and any references to the websites are intended to be inactive textual references only.

About Hyatt Hotels Corporation

Hyatt Hotels Corporation, headquartered in Chicago, is a leading global hospitality company guided by its purpose – to care for people so they can be their best. As of September 30, 2024, the Company's portfolio included more than 1,350 hotels and all-inclusive properties in 79 countries across six continents. The Company's offering includes brands in the Timeless Collection, including Park Hyatt®, Grand Hyatt®, Hyatt Regency®, Hyatt®, Hyatt Vacation Club®, Hyatt Place®, Hyatt House®, Hyatt Studios, and UrCove; the Boundless Collection, including Miraval®, Alila®, Andaz®, Thompson Hotels®, Dream® Hotels, Hyatt Centric®, and Caption by Hyatt®; the Independent Collection, including The Unbound Collection by Hyatt®, Destination by Hyatt®, and JdV by Hyatt®; and the Inclusive Collection, including Impression by Secrets, Hyatt Ziva®, Hyatt Zilara®, Zoëtry® Wellness & Spa Resorts, Secrets® Resorts & Spas, Breathless Resorts & Spas®, Dreams® Resorts & Spas, Hyatt Vivid Hotels & Resorts, Alua Hotels & Resorts®, and Sunscape® Resorts & Spas. Subsidiaries of the Company operate the World of Hyatt® loyalty program, ALG Vacations®, Mr & Mrs Smith™, Unlimited Vacation Club®, Amstar DMC destination management services, and Trisept Solutions® technology services. For more information, please visit www.hyatt.com.

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