Stock Analysis on Net
Stock Analysis on Net

Hilton Worldwide Holdings Inc. (NYSE:HLT)

This company has been moved to the archive! The financial data has not been updated since August 7, 2024.

Common-Size Income Statement

Hilton Worldwide Holdings Inc., common-size consolidated income statement

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Franchise and licensing fees 23.16 23.57 25.79 21.94 17.78
Base and other management fees 3.34 3.35 3.04 2.86 3.51
Incentive management fees 2.68 2.23 1.69 0.88 2.43
Owned and leased hotels 12.15 12.26 10.33 9.77 15.04
Other revenues 1.74 1.16 1.36 1.69 1.07
Other revenues from managed and franchised properties 56.93 57.41 57.77 62.85 60.16
Revenues 100.00% 100.00% 100.00% 100.00% 100.00%
Owned and leased hotels -11.15 -11.39 -11.73 -14.40 -13.27
Depreciation and amortization -1.44 -1.85 -3.25 -7.69 -3.66
General and administrative -3.99 -4.35 -7.00 -7.22 -4.67
Reorganization costs 0.00 0.00 0.00 -0.95 0.00
Impairment losses -0.37 0.00 0.00 -5.99 0.00
Other expenses -1.09 -0.68 -0.78 -1.39 -0.76
Other expenses from managed and franchised properties -60.22 -57.86 -59.68 -72.07 -60.97
Expenses -78.26% -76.13% -82.43% -109.71% -83.33%
Gain (loss) on sales of assets, net 0.00 0.00 -0.12 0.00 0.86
Operating income (loss) 21.74% 23.87% 17.45% -9.71% 17.53%
Interest expense -4.53 -4.73 -6.86 -9.96 -4.38
Gain (loss) on foreign currency transactions -0.16 0.06 -0.12 -0.63 -0.02
Loss on debt extinguishment 0.00 0.00 -1.19 -1.11 0.00
Loss on investments in unconsolidated affiliate -0.90 0.00 0.00 0.00 0.00
Other non-operating income (loss), net 0.38 0.57 0.40 -0.05 0.03
Income (loss) before income taxes 16.53% 19.77% 9.68% -21.45% 13.16%
Income tax (expense) benefit -5.29 -5.44 -2.64 4.74 -3.79
Net income (loss) 11.25% 14.33% 7.03% -16.72% 9.37%
Net (income) loss attributable to noncontrolling interests -0.10 -0.02 0.05 0.12 -0.05
Net income (loss) attributable to Hilton stockholders 11.15% 14.31% 7.08% -16.60% 9.32%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

The financial performance from 2019 to 2023 is characterized by a severe contraction in 2020 followed by a disciplined recovery and a structural shift toward higher-margin revenue streams. The transition suggests a strategic pivot toward a more asset-light model, with operating margins in 2023 exceeding pre-pandemic levels.

Revenue Stream Composition
A notable increase in the proportion of revenues derived from franchise and licensing fees is observed, rising from 17.78% in 2019 to 23.16% in 2023. This suggests a growing reliance on high-margin, recurring fee income. Conversely, revenues from owned and leased hotels declined from 15.04% in 2019 to 12.15% in 2023, indicating a reduced exposure to the capital-intensive ownership of properties.
Incentive management fees showed high volatility, dropping to 0.88% in 2020 during the industry downturn before recovering to 2.68% by 2023, reflecting the correlation between these fees and hotel performance.
Expense Structure and Operational Efficiency
Total expenses as a percentage of revenues spiked to 109.71% in 2020, resulting in a significant operating loss. However, a subsequent downward trend is evident, with expenses falling to 78.26% by 2023, which is lower than the 83.33% recorded in 2019.
General and administrative expenses were optimized over the period, peaking at 7.22% in 2020 and steadily declining to 3.99% by 2023. Similarly, depreciation and amortization as a percentage of revenue decreased sharply from a peak of 7.69% in 2020 to 1.44% in 2023, suggesting improved asset utilization or the effect of prior impairments.
Non-recurring costs, specifically impairment losses of 5.99% and reorganization costs of 0.95%, were concentrated in 2020, contributing to the temporary collapse in profitability.
Profitability and Leverage
Operating income exhibited a strong recovery, moving from -9.71% in 2020 to 21.74% in 2023, surpassing the 2019 baseline of 17.53%. This expansion in operating margin aligns with the increase in franchise fees and the reduction in G&A expenses.
Interest expense as a percentage of revenue peaked at 9.96% in 2020 due to the diminished revenue base but has since stabilized at 4.53% in 2023, indicating a healthier debt-to-revenue relationship.
Net income attributable to stockholders followed a similar trajectory, recovering from a deficit of -16.60% in 2020 to 11.15% in 2023, marking an improvement over the 9.32% margin seen in 2019.

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