CHICAGO--(February 14, 2014)--Hyatt Hotels Corporation ("Hyatt" or the "Company") (NYSE: H) today reported fourth quarter 2013 financial results as follows:

  • Adjusted EBITDA was $178 million in the fourth quarter of 2013 compared to $147 million in the fourth quarter of 2012, an increase of 21.1%.
  • Adjusted for special items, net income attributable to Hyatt was $51 million, or $0.32 per share, during the fourth quarter of 2013 compared to net income attributable to Hyatt of $33 million, or $0.20 per share, during the fourth quarter of 2012.
  • Net income attributable to Hyatt was $32 million, or $0.20 per share, during the fourth quarter of 2013 compared to net income attributable to Hyatt of $16 million, or $0.09 per share, in the fourth quarter of 2012.
  • Comparable owned and leased hotel RevPAR increased 6.2% (5.9% excluding the effect of currency) in the fourth quarter of 2013 compared to the fourth quarter of 2012.
  • Comparable owned and leased hotel operating margins increased 60 basis points in the fourth quarter of 2013 compared to the same period in 2012. Owned and leased hotel operating margins increased 110 basis points in the fourth quarter of 2013 compared to the fourth quarter of 2012.
  • Comparable systemwide RevPAR increased 4.2% (5.9% excluding the effect of currency) in the fourth quarter of 2013 compared to the fourth quarter of 2012.
  • Comparable U.S. full service hotel RevPAR increased 7.0% in the fourth quarter of 2013 compared to the fourth quarter of 2012. Comparable U.S. select service hotel RevPAR increased 4.0% in the fourth quarter of 2013 compared to the fourth quarter of 2012.
  • Sixteen properties were opened. As of December 31, 2013, the Company's executed contract base consisted of approximately 240 hotels or approximately 54,000 rooms.
  • The Company repurchased 468,679 shares of common stock at a weighted average price of $48.12 per share, for an aggregate purchase price of approximately $23 million.

Mark S. Hoplamazian, president and chief executive officer of Hyatt Hotels Corporation, said, "In the fourth quarter, we continued to see positive demand trends among both transient and group travelers, particularly in the Americas. This is leading to continued rate improvement across our brands.

"We continue to be focused on expanding our presence in key markets around the world. During the quarter, we opened 16 hotels, bringing our total hotel openings for the year to 51 hotels. The fourth quarter openings included our first all inclusive resorts, Hyatt Ziva Los Cabos and Hyatt Zilara Cancun and the second resort for the Andaz brand, Andaz Peninsula Papagayo that opened to very positive guest feedback and joins the recently opened Andaz Maui at Wailea. We also continued to expand the Hyatt Place brand by opening hotels in urban markets such as Charlotte, Minneapolis, Nashville and Omaha. Our current base of executed contracts for new hotels is the largest it has ever been and represents approximately 40% of our current system size, reflecting healthy demand for our brands across all regions.

"Our asset recycling strategy continues to provide additional opportunities to fund growth in targeted areas. In 2013, we sold seven full service and three select service hotels at strong pricing while maintaining brand presence. Additionally, we realized more than $400 million in cash from the settlement of loans, and the sale of venture and preferred equity investments. During the fourth quarter, we acquired our partner's interest in Grand Hyatt San Antonio, a leading hotel that is adjacent to the Henry B. Gonzalez Convention Center. Consistent with our asset recycling strategy, we recently announced the expected sale of a portfolio of 10 hotels under the Hyatt Place, Hyatt House and Hyatt brands to a high quality owner for $313 million.

"Looking ahead, we expect healthy occupancy levels in the U.S. to support increasing strength in room prices. We expect to continue our asset recycling program and deploy proceeds into key growth priorities in order to drive guest and owner preference for our brands."

Owned and Leased Hotels Segment

Total segment Adjusted EBITDA increased 17.6% in the fourth quarter of 2013 compared to the same period in 2012.

Owned and leased Adjusted EBITDA increased 14.9% in the fourth quarter of 2013 compared to the same period in 2012. See the table on page 17 of the accompanying schedules for a detailed list of portfolio changes and the year-over-year net impact to fourth quarter owned and leased Adjusted EBITDA.

Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA increased 33.3% in the fourth quarter of 2013, primarily due to results from the Company's investment in the all inclusive resort segment.

Revenue increased 7.7% in the fourth quarter of 2013 compared to the same period in 2012. Owned and leased hotel expenses increased 6.2% in the fourth quarter of 2013 compared to the same period in 2012.

RevPAR for comparable owned and leased hotels increased 6.2% (5.9% excluding the effect of currency) in the fourth quarter of 2013 compared to the same period in 2012. Occupancy increased 110 basis points and ADR increased 4.7% (4.4% excluding the effect of currency) compared to the same period in 2012.

Comparable hotel revenues increased 6.5% in the fourth quarter of 2013 compared to the same period in 2012. Excluding expenses related to benefit programs funded through rabbi trusts and non-comparable hotel expenses, expenses increased 5.6% in the fourth quarter of 2013 compared to the same period in 2012. See the table on page 10 of the accompanying schedules for a reconciliation of comparable owned and leased hotels expenses to owned and leased hotels expenses.

Comparable owned and leased hotel operating margins increased 60 basis points in the fourth quarter of 2013 compared to the fourth quarter of 2012. Comparable owned and leased hotel operating margins for hotels in the Americas increased 90 basis points in the fourth quarter of 2013 compared to the fourth quarter of 2012. Comparable owned and leased hotel operating margins in the Americas were negatively impacted by rent increases at two hotels. Comparable owned and leased hotel operating margins in ASPAC and EAME/SW Asia decreased 40 basis points in the fourth quarter of 2013 compared to the fourth quarter of 2012. Comparable owned and leased hotel operating margins in ASPAC and EAME/SW Asia were negatively impacted by adverse market conditions at one hotel in each of these regions.

The following three hotels were added to the portfolio during the fourth quarter:

  • Hyatt Regency Orlando (owned, 1,641 rooms). The Company acquired the hotel as previously announced.
  • Grand Hyatt San Antonio (owned, 1,003 rooms). The Company acquired its unconsolidated hospitality venture partner's 70% interest in the hotel.
  • Hyatt Place Omaha Downtown Old Market (owned, 159 rooms). This hotel was developed by the Company.

The following hotel was removed from the owned and leased portfolio as it was sold during the fourth quarter:

  • Hyatt Key West Resort and Spa (118 rooms). The Company entered into a management agreement and therefore the hotel remains included within the Hyatt system.

Management and Franchise Fees

Total fee revenue increased 17.5% to $94 million in the fourth quarter of 2013 compared to the same period in 2012. Base management fees increased 7.7% to $42 million in the fourth quarter of 2013 compared to the same period in 2012. Incentive management fees decreased 25.9% to $20 million in the fourth quarter of 2013 compared to the same period in 2012 and were negatively impacted by the reversal of approximately $11 million of previously recognized incentive management fees from recently converted hotels in EAME/SW Asia. Franchise fees increased 44.4% to $13 million in the fourth quarter of 2013 compared to the same period in 2012. Other fee revenue increased 280.0% to $19 million in the fourth quarter of 2013 compared to the same period in 2012, primarily due to a $12 million termination fee related to one hotel in the Americas.

Americas Management and Franchising Segment

Adjusted EBITDA increased 42.0% in the fourth quarter of 2013 compared to the same period in 2012.

RevPAR for comparable Americas full service hotels increased 6.7% (7.3% excluding the effect of currency) in the fourth quarter of 2013 compared to the same period in 2012. Occupancy increased 230 basis points and ADR increased 3.2% (3.8% excluding the effect of currency) compared to the same period in 2012.

Group rooms revenue at comparable U.S. full service hotels increased 6.3% in the fourth quarter of 2013 compared to the same period in 2012. Group room nights increased 3.9% and group ADR increased 2.4% in the fourth quarter of 2013 compared to the same period in 2012.

Transient rooms revenue at comparable U.S. full service hotels increased 7.6% in the fourth quarter of 2013 compared to the same period in 2012. Transient room nights increased 3.3% and transient ADR increased 4.1% in the fourth quarter of 2013 compared to the same period in 2012.

RevPAR for comparable Americas select service hotels increased 4.0% in the fourth quarter of 2013 compared to the same period in 2012. Occupancy increased 70 basis points and ADR increased 2.8% in the fourth quarter of 2013 compared to the same period in 2012.

Revenue from management and franchise fees increased 37.5% in the fourth quarter of 2013 compared to the same period in 2012.

The following 14 hotels were added to the portfolio during the fourth quarter:

  • Hyatt Ziva Los Cabos, Mexico (franchised, 619 rooms)
  • Hyatt Zilara Cancun, Mexico (franchised, 306 rooms)
  • Andaz Peninsula Papagayo, Costa Rica (managed, 153 rooms)
  • Hyatt Regency Orlando (owned, 1,641 rooms)
  • Hyatt Times Square New York (managed, 487 rooms)
  • Hyatt Place Denver/Cherry Creek (franchised, 194 rooms)
  • Hyatt Place Charlotte Downtown (franchised, 172 rooms)
  • Hyatt Place Daytona Beach - Oceanfront (franchised, 143 rooms)
  • Hyatt Place Minneapolis/Downtown (managed, 213 rooms)
  • Hyatt Place Nashville Downtown (franchised, 255 rooms)
  • Hyatt Place Omaha Downtown Old Market (owned, 159 rooms)
  • Hyatt Place San Jose Del Cabo, Mexico (managed, 157 rooms)
  • Hyatt Place St. Louis / Chesterfield (franchised, 145 rooms)
  • Hyatt Place Bayamón, Puerto Rico (managed, 156 rooms)

One hotel was removed from the portfolio during the fourth quarter.

Southeast Asia, China, Australia, South Korea and Japan (ASPAC) Management and Franchising Segment

Adjusted EBITDA increased 20.0% in the fourth quarter of 2013 compared to the same period in 2012.

RevPAR for comparable ASPAC hotels decreased 1.3% (increased 4.2% excluding the effect of currency) in the fourth quarter of 2013 compared to the same period in 2012. Occupancy increased 240 basis points and ADR decreased 4.7% (increased 0.5% excluding the effect of currency) compared to the same period in 2012.

Revenue from management and franchise fees increased 4.2% in the fourth quarter of 2013 compared to the same period in 2012.

The following hotel was added to the portfolio during the fourth quarter:

  • Hyatt Regency Phuket Resort, Thailand (managed, 199 rooms)

One hotel was removed from the portfolio during the fourth quarter, as it was closed for extensive renovations.

Europe, Africa, Middle East and Southwest Asia (EAME/SW Asia) Management Segment

Adjusted EBITDA decreased 85.7% in the fourth quarter of 2013 compared to the same period in 2012.

RevPAR for comparable EAME/SW Asia hotels increased 3.3% (5.0% excluding the effect of currency) in the fourth quarter of 2013 compared to the same period in 2012. Occupancy increased 100 basis points and ADR increased 1.7% (3.4% excluding the effect of currency) compared to the same period in 2012.

Revenue from management and franchise fees decreased 44.4% in the fourth quarter of 2013 compared to the same period in 2012. The decrease was due to a reversal of approximately $11 million of previously recognized incentive management fees from recently converted hotels.

The following hotel was added to the portfolio during the fourth quarter:

  • Hyatt Place Yerevan, Armenia (managed, 95 rooms)

One hotel was removed from the portfolio during the fourth quarter.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses increased 11.5% in the fourth quarter of 2013 compared to the same period in 2012. Adjusted selling, general, and administrative expenses increased 3.9% in the fourth quarter of 2013 compared to the same period in 2012. Adjusted selling, general, and administrative expenses were approximately $10 million lower than expected primarily due to bad debt recoveries and the timing of certain costs. See the table on page 9 of the accompanying schedules for a reconciliation of adjusted selling, general, and administrative expenses to selling, general, and administrative expenses.

OPENINGS AND FUTURE EXPANSION

Sixteen hotels were added in the fourth quarter of 2013, each of which is listed above. During the 2013 full fiscal year, the Company opened 51 hotels, representing 13,111 rooms. Three hotels, representing 1,340 rooms, were removed from the portfolio during the 2013 full fiscal year.

The Company expects that a significant number of new properties will be opened under all of the Company's brands in the future. As of December 31, 2013 this effort was underscored by executed management or franchise contracts for approximately 240 hotels (or approximately 54,000 rooms) across all brands. The executed contracts represent potential entry into several new countries and expansion into many new markets or markets in which the Company is under-represented. See the table on page 16 of the accompanying schedules for a breakdown of the executed contract base.

SHARE REPURCHASE

During the fourth quarter, the Company repurchased 468,679 shares of common stock at a weighted average price of $48.12 per share, for an aggregate purchase price of approximately $23 million. From January 1 through February 11, 2014, the Company repurchased 329,823 shares of common stock at a weighted average price of $48.79 per share, for an aggregate purchase price of approximately $16 million. As of February 11, 2014, the Company had approximately $173 million remaining under its share repurchase authorization.

CORPORATE FINANCE / ASSET RECYCLING

During the quarter, the Company completed the following transactions:

  • Acquired The Peabody Orlando for approximately $717 million and rebranded the hotel as Hyatt Regency Orlando.
  • Acquired its unconsolidated hospitality venture partner's 70% interest in Grand Hyatt San Antonio for a purchase price of $16 million. Subsequent to the acquisition, the Company repaid $44 million of mezzanine debt that was held at the hospitality venture. As a result of the acquisition, the Company assumed $200 million of hotel level debt.
  • Sold Hyatt Key West Resort and Spa for approximately $76 million.
  • Sold Hyatt Place Minneapolis/Downtown for approximately $33 million. This hotel was developed by the Company.
  • Received approximately $109 million related to its preferred equity investment in Hyatt Regency New Orleans, of which approximately $63 million reflects a return of capital, approximately $26 million reflects a preferred return and approximately $20 million reflects the sale of the Company's residual interest. The preferred return and sale of the Company's residual interest is reflected in other income on the Company's consolidated income statement. The Company continues to manage the hotel.

BALANCE SHEET / OTHER ITEMS

On December 31, 2013, the Company reported the following:

  • Total debt of approximately $1.5 billion, inclusive of approximately $200 million of hotel level debt assumed in connection with the purchase of Grand Hyatt San Antonio.
  • Pro rata share of non-recourse unconsolidated hospitality venture debt of approximately $672 million compared with approximately $737 million as of September 30, 2013.
  • Cash and cash equivalents, including investments in highly-rated money market funds and similar investments, of approximately $454 million and short-term investments of approximately $30 million.
  • Undrawn borrowing availability of approximately $1.4 billion under its revolving credit facility.

2014 INFORMATION

The Company is providing the following information for the 2014 fiscal year:

  • Adjusted SG&A expense is expected to be approximately $325 million.
  • Capital expenditures are expected to be approximately $350 million, including approximately $175 million for investment in new properties.
  • In addition to the capital expenditures described above, the Company intends to continue a strong level of investment spending. Investment spending includes acquisitions, equity investments in joint ventures, debt investments, contract acquisition costs or other investments.
  • Depreciation and amortization expense is expected to be approximately $375 million.
  • Interest expense is expected to be approximately $80 million.
  • The Company expects to open approximately 40 hotels in 2014.

To view corresponding tables associated with this release please visit www.hyatt.com

About Hyatt Hotels Corporation

Hyatt Hotels Corporation, headquartered in Chicago, is a leading global hospitality company with a proud heritage of making guests feel more than welcome. Thousands of members of the Hyatt family strive to make a difference in the lives of the guests they encounter every day by providing authentic hospitality. The Company's subsidiaries manage, franchise, own and develop hotels and resorts under the Hyatt®, Park Hyatt®, Andaz®, Grand Hyatt®, Hyatt Regency®, Hyatt Place®, Hyatt House®, Hyatt Zilara™and Hyatt Ziva™brand names and have locations on six continents. Hyatt Residential Group, Inc., a Hyatt Hotels Corporation subsidiary, develops, operates, markets or licenses Hyatt Residences® and Hyatt Residence Club®. As of December 31, 2013, the Company's worldwide portfolio consisted of 548 properties in 48 countries. For more information, please visit www.hyatt.com.

Contact: Atish Shah

atish.shah@hyatt.com / 312.780.5427

Contact: Media: Farley Kern

farley.kern@hyatt.com / 312.780.5506

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