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
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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.
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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
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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
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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