Hilton Worldwide
Annual Report 2018

Plain-text annual report

THE HILTON Effect 2018 Annual Report 5,600 + PROPERTIES 10 Million TEAM MEMBERS 3 Billion GUESTS $1 Trillion IN ECONOMIC IMPACT These numbers represent the positive, world-altering impact Hilton has had on lives and communities around the globe in its nearly 100-year history. 2 Hilton 2018 Annual Report2018 Highlights A RECORD-SETTING YEAR In 2018 – our 99th year of hospitality – we continued the momentum that will extend The Hilton Effect well into our next 100 years. Christopher J. Nassetta Chief Executive Officer A STRONG FINISH TO OUR FIRST CENTURY Reflecting on 2018, Hilton continued to have a positive impact on the people and communities we serve, fueling strong growth and performance across our business. Kevin Jacobs Chief Financial Officer 3 Hilton 2018 Annual ReportOUR PERFORMANCE: KEY STRATEGIC PRIORITIES KEY STRATEGIC Priorities Waldorf Astoria Edinburgh — The Caledonian Align CULTURE & ORGANIZATION • Ranked #2 World’s Best Workplace by Great Place to Work® • Recognized as #1 Workplace for Diversity by Win ON CUSTOMER EXPERIENCE • Demonstrated the power of our network effect by increasing industry-leading market share premiums 100 basis points for the full year FORTUNE and a Top 10 Company for Diversity • Enrolled more than 14 million new Hilton Honors by DiversityInc members, bringing total membership to more • Created more than 28,000 new hospitality than 85 million jobs globally • Awarded 10 Team Members the opportunity • Scaled industry-first Digital Key technology to more than 4,100 properties with 7.6 million keys to take a paid four-week Thrive Sabbatical to downloaded in 2018 give a dream or live a dream as part of our • Rolled out more than 1,800 Connected Thrive@Hilton commitment • Remained focused on Operation: Opportunity, our commitment to hire an additional 20,000 veterans, spouses, dependents and caregivers by 2020 Rooms, enabling guests to create more personalized travel experiences through partnerships with Netflix® and SHOWTIME® and other customization features 4 Hilton 2018 Annual ReportOUR PERFORMANCE: KEY STRATEGIC PRIORITIES Expand GLOBAL FOOTPRINT • Grew development pipeline to more than 364,000 rooms across 15 brands, supported by record approvals of nearly 110,000 rooms • Opened more than a hotel per day, adding 452 properties and bringing our portfolio to more than 5,600 properties with nearly 913,000 rooms in 113 countries and territories • Unveiled Motto by Hilton, an affordable lifestyle micro-hotel brand that will give guests the freedom to create their own experiences in the world’s top urban destinations • Expanded our luxury portfolio with the launch of LXR Hotels & Resorts, a luxury collection of distinctive hotels and resorts offering singular service and remarkable local experiences Waldorf Astoria Ras Al Khaimah Maximize PERFORMANCE + ~7% Net Unit Growth + 6% Rooms in Pipeline from 2017 $2.79 Adjusted Diluted EPS* + 3% System-Wide 2018 Revenue Per + 10% Adjusted EBITDA* to $2.1 Billion Available Room (RevPAR) Growth $1.9 Billion Returned to Shareholders in the Form of Buybacks and Dividends * Reconciliations of non-GAAP to GAAP financial measures can be found on pages 12 and 14 in our Fourth Quarter and Full Year 2018 earnings press release. 5 Hilton 2018 Annual ReportOUR PERFORMANCE: GLOBAL GROWTH GLOBAL Growth Hilton is one of the world’s largest hospitality companies, with more than 5,600 properties, comprising nearly 913,000 rooms in 113 countries and territories. We are committed to being everywhere our guests want to travel. THE AMERICAS: We expanded our luxury offerings with the opening of Waldorf Astoria Hotels & Resorts properties in Las Vegas and Atlanta, and grew our All Suites and Focused Service portfolios, opening our 1,000th All Suites property, and 50th Tru by Hilton. EUROPE, MIDDLE EAST AND AFRICA: LXR Hotels & Resorts launched its first property in Dubai with Al Habtoor Group; we debuted the Hilton Garden Inn brand in France, and introduced Hampton by Hilton to the United Arab Emirates with a 420-room property in Dubai, the world’s largest Hampton. ASIA PACIFIC: DoubleTree by Hilton expanded its presence in the region, with key openings including DoubleTree by Hilton Okinawa Chatan Resort and DoubleTree by Hilton Hainan Xinglong; we also grew our luxury portfolio with the opening of Waldorf Astoria Bangkok and Conrad Bengaluru. GROWTH BY BRAND 2008-2018 As of Dec. 31, 2018 2008 2018 Brand Properties Pipeline Properties Pipeline Waldorf Astoria Hotels & Resorts LXR Hotels & Resorts Conrad Hotels & Resorts Canopy by Hilton Hilton Hotels & Resorts Curio Collection by Hilton DoubleTree by Hilton Tapestry Collection by Hilton Embassy Suites by Hilton Motto by Hilton Hilton Garden Inn Hampton by Hilton Tru by Hilton Homewood Suites by Hilton Home2 Suites by Hilton Hilton Grand Vacations 6 0 17 0 511 0 207 0 199 0 429 1,619 0 258 0 35 11 0 9 0 82 0 26 0 60 0 214 509 0 129 0 0 31 1 33 8 586 68 559 18 253 0 815 2,433 53 482 290 51 19 1 19 34 169 57 207 45 46 1 307 642 316 105 435 0 TOTAL 3,294 1,040 5,685 2,403 6 Hilton 2018 Annual ReportOUR Guests Since Hilton opened its doors nearly a century ago, we have welcomed more than 3 billion guests by easing travel, broadening perspectives and building trust — dramatically changing the travel landscape through various industry-firsts. HILTON FIRSTS Hilton was the first hospitality company to cater extensively to business travelers so they can focus their time and energy on the all-important meeting or negotiation, rather than the challenges of navigating an unfamiliar place. And throughout our history, we have introduced numerous innovations to enhance the guest experience — from the first air-conditioned hotel lobbies and televisions in guest rooms to the invention of the piña colada and today’s Digital Key and Connected Room. The Hilton Effect: Puerto Rico See more Hilton Effect videos here. Air-Conditioned Hotel Lobbies Guest Room Televisions Created the Piña Colada Digital Key Connected Room Our award-winning guest loyalty program, Hilton Honors, added more than 14 million members in 2018, bringing membership to more than 85 million. Members who book direct through Hilton channels enjoy instant benefits, including exclusive member discounts and free standard WiFi, all while earning Points for their stays. WAYS TO REDEEM HILTON HONORS POINTS Free Night Stays Live Nation Concerts Shop on Amazon VIP Events In 2018, Hilton debuted a new campaign to directly address the frustrations consumers face when booking their hotel stay. Expect Better. Expect Hilton. 7 Hilton 2018 Annual ReportOUR GUESTS: OUR BRANDS OUR Brands With the best-performing portfolio in the business, Hilton’s award-winning brands serve guests with any lodging need anywhere in the world. 8 Hilton 2018 Annual ReportOUR Team Members For nearly a century, Hilton has not only changed the face of travel globally, but also impacted the lives of more than 10 million Team Members. Hilton has impacted its Team Members by fostering a powerful entrepreneurial spirit and wide- ranging career opportunities — creating a culture where it is possible for a restaurant server to become a senior leader — and encouraging innovative ideas from every corner of the company. Today, we are committed to empowering all Team Members to leverage their full potential, investing extensively in industry-leading training and creating a culture of inclusive growth. The Hilton Effect: Myanmar HEAR MORE ABOUT THE HILTON EFFECT FROM THESE TEAM MEMBERS The Hilton Effect: China The Hilton Effect: London 9 Hilton 2018 Annual ReportOUR TEAM MEMBERS HILTON We Are We Are HOSPITALITY Hilton Shenzhen Shekou Nanhai OUR VISION To fill the earth with the light and warmth of hospitality — by delivering exceptional experiences — every hotel, every guest, every time. OUR MISSION To be the most hospitable company in the world — by creating heartfelt experiences for guests, meaningful opportunities for Team Members, high value for owners and positive impact in our communities. OUR VALUES HOSPITALITY We are passionate about delivering exceptional guest experiences. LEADERSHIP We are leaders in our industry and in our communities. OWNERSHIP We are the owners of our actions and decisions. INTEGRITY We do the right thing, all the time. NOW We operate with a sense of urgency and discipline. TEAMWORK We are team players in everything we do. 10 Hilton 2018 Annual ReportMEET OUR LEADERS OUR Leaders CHRISTOPHER J. NASSETTA President & Chief Executive Officer MATTHEW W. SCHUYLER Chief Human Resources Officer KRISTIN CAMPBELL General Counsel CHRIS SILCOCK Chief Commercial Officer IAN R. CARTER President, Global Development, Architecture, Design & Construction KATIE B. FALLON Global Head of Corporate Affairs SIMON VINCENT President, Europe, Middle East & Africa ALAN WATTS President, Asia Pacific DANNY HUGHES President, Americas JONATHAN A. WITTER Chief Customer Officer KEVIN JACOBS Chief Financial Officer 11 Hilton 2018 Annual ReportOUR Communities Hilton has woven itself into the history, economies and very fiber of communities all over the world, often serving as the catalyst for development, renewal and growth. We continue to grow sustainably through Travel with Purpose, our corporate responsibility strategy. The Hilton Effect: Abuja REDEFINING SUSTAINABLE TRAVEL By 2030, we are committed to doubling our investment in social impact and cutting our environmental footprint in half, ensuring the destinations where our guests live, work and travel are vibrant and resilient for generations to come. For more information on our Travel with Purpose 2030 goals, visit our website. We operate at a global scale, but our success is driven locally in more than 5,600 communities and neighborhoods around the world. Here, we create jobs, support small businesses by sourcing local products, and help shape strong and resilient communities. Hilton has been the first to enter numerous emerging markets around the globe, and has led the charge on revitalizing communities in need of economic growth and opportunity. Hilton Travel with Purpose 12 Hilton 2018 Annual ReportOUR COMMUNITIES: TRAVEL WITH PURPOSE 2018 Key Milestones We’re committed to sustainable travel and tourism through the execution of our Travel with Purpose strategy. That’s why in 2018 we launched ambitious new 2030 goals to drive positive social and environmental change on a global scale. Here’s a look at what we accomplished in 2018. HILTON IS REDEFINING SUSTAINABLE TRAVEL Launched the Hilton 2030 Travel with Purpose goals, committing to doubling investment in social impact and cutting our environmental footprint in half by 2030 Debuted as the first major hotel company to set SCIENCE-BASED CARBON REDUCTION TARGETS approved by the Science-based Targets Initiative Announced initial investment of USD $1 MILLION TO DRIVE SUSTAINABLE TRAVEL AND TOURISM in Africa Became first hotel company to COMMIT TO SENDING ZERO SOAP TO LANDFILL NAMED INDUSTRY LEADER on the Dow Jones Sustainability Index, North America RANKED 2ND on the World’s Best Regarded Companies by Forbes Premiered as the only hospitality company on FORTUNE’S 2018 CHANGE THE WORLD LIST RECOGNIZED AS THE MOST JUST COMPANY in our industry and America’s top 100 Most JUST companies by Forbes & JUST Capital AWARDED 2018 BEST CORPORATE STEWARD by U.S. Chamber of Commerce Foundation LEARN MORE ABOUT OUR ACCOMPLISHMENTS AND 2030 GOALS AT CR.HILTON.COM 13 Hilton 2018 Annual ReportOUR COMMUNITIES: TRAVEL WITH PURPOSE DOUBLING INVESTMENT IN SOCIAL IMPACT Supported the development and launch of global industry goals for youth, water, carbon and human rights in partnership with the International Tourism Partnership Rolled out mandatory antitrafficking training across all brands Logged 236,930 Team Member volunteer hours across 93 countries and nearly 5,300 projects during our 2018 Global Week of Service Launched Tru by Hilton partnership with Boys & Girls Clubs of America to provide Club teens with the foundation they need to prepare for future careers Impacted over 900,000 young people nearing our pledge to Open Doors for 1 million young people by 2019 Donated over 234 million Hilton Honors points to support nonprofit organizations in 2018 Launched 10 campaigns globally through the Hilton Responds Fund, raising over $175,000 to support 100 Team Members who were impacted by natural disasters Awarded 76 Travel with Purpose Action Grants, investing $220,000 in local communities CUTTING OUR ENVIRONMENTAL FOOTPRINT IN HALF ZERO SOAP TO LANDFILL Diverted more than 1.8 million pounds of soap and plastic bottles from landfills Distributed more than 9.6 million bars of soap in 127 countries Launched brand standard to remove plastic straws, stir sticks and cocktail picks from all hotel operations, including franchises, by June 30, 2019 Named a USDA Food Loss and Waste 2030 Champion by the U.S. Department of Agriculture, Environmental Protection Agency and Food and Drug Administration Built more than 1.2 million hygiene kits for communities in need Activated 2,774 projects at 1,327 global locations during Earth Week 2018 Contributed to a 35 percent reduction in the death rate of children under the age of five dying due to hygiene-related illnesses Signed onto the UN Water Action Platform and joined The Climate Group’s Energy Productivity initiative LEARN MORE ABOUT OUR ACCOMPLISHMENTS AND 2030 GOALS AT CR.HILTON.COM 14 Hilton 2018 Annual Report STOCKHOLDER Information Stock Market Information Ticker Symbol: HLT Market Listed and Traded: NYSE Corporate Office Hilton 7930 Jones Branch Drive McLean, Virginia 22102 +1 703 883 1000 www.hilton.com/corporate Investor Relations 7930 Jones Branch Drive McLean, Virginia 22102 +1 703 883 5476 ir.hilton.com ir@hilton.com Independent Registered Public Accounting Firm Ernst & Young LLP 1775 Tysons Boulevard Tysons, Virginia 22102 +1 703 747 1000 ey.com Transfer Agent EQ Shareowner Services P.O. Box 64874 St. Paul, Minnesota 55164-0874 +1 800 468 9716 www.shareowneronline.com Annual Meeting of Stockholders May 9, 2019 Dallas, TX Board of Directors CHRISTOPHER NASSETTA President, Chief Executive Officer & MELANIE L. HEALEY Former Group President, JOHN G. SCHREIBER President of Centaur Capital Director, Hilton The Procter & Gamble Company Partners; Retired Partner & JONATHAN D. GRAY Chairman of the Board of Directors, RAYMOND E. MABUS, JR. United States Secretary of the Navy Hilton; President & Chief Operating 2009-2017; Former Governor of Officer, Blackstone Mississippi; Former U.S. Ambassador Co-Founder, Blackstone Real Estate Advisors ELIZABETH A. SMITH Executive Chair of the Board of to the Kingdom of Saudi Arabia Directors, Bloomin’ Brands CHARLENE T. BEGLEY Former Senior Vice President & Chief Information Officer, General Electric; JUDITH A. MCHALE President & Chief Executive Officer, DOUGLAS M. STEENLAND Chairman of the Board of Directors, President & Chief Executive Officer Cane Investments; Former President American International Group & of Home and Business Solutions, & Chief Executive Officer, Discovery Travelport Worldwide General Electric Communications 15 Hilton 2018 Annual Reportir.hilton.com 

Continue reading text version or see original annual report in PDF format above