Hilton Worldwide Holdings (HLT) posted stronger-than-expected first quarter earnings Wednesday, and lifted its full-year profit outlook, as new hotel openings added 10,000 new rooms and drove solid revenue gains.
Hilton said adjusted earnings for the three months ending in March came in at 80 cents per share, a 16% increase from the same period last year and four cents ahead of the Street consensus forecast. Group revenues, Hilton said, advanced 6.27% to $2.204 billion but came in just shy of the $2.21 billion figure forecast by analysts that follow the group.
Looking into 2019, Hilton said it sees revenue for each available room, a key industry metric for profitability, rising between 1% and 3% from last year, with net income of between $881 million and $910 million.
Adjusted operating earnings, Hilton said, are seen in a range of $2.265 to $2.305 billion, or $3.74 to $3.84 on a diluted basis, compared to Refinitiv's forecast of $3.85 and the group's prior forecast of $3.66 to $3.78 per share.
"We are happy to report a good start to the year with first quarter results that exceeded the high end of guidance for Adjusted EBITDA and diluted EPS, adjusted for special items," said CEO Chris Nassetta. "We continued to drive impressive market share gains across all brand segments and regions during the first quarter, further increasing our industry-leading RevPAR index premium."
"We were also excited to launch our newest brand, Signia Hilton," he added. "We expect this dynamic and innovative brand to change the meetings and events space and enable us to better serve our guests and owners."
Hilton shares were marked 5.32% higher at the start of trading Wednesday to change hands at $91.64 each following the earnings release, a move that extends the stock's year-to-date gain to around 27.6%.
"In the first quarter of 2019, Hilton opened 85 new hotels totaling 12,100 rooms and achieved net unit growth of 10,000 rooms, a 41 percent increase from the same period in 2018," the company said. "As of March 31, 2019, Hilton's development pipeline totaled nearly 2,480 hotels consisting of over 371,000 rooms throughout 108 countries and territories, including 37 countries and territories where Hilton does not currently have any open hotels."
"Additionally, 200,000 rooms in the development pipeline were located outside the U.S., and 193,000 rooms, or more than half, were under construction," it added.