Hyatt Hotels Corporation · NYSE:H
Hyatt Hotels — Investor Day (March 2019)
101 slides from Hyatt Hotels's investor day presentation, Mar 5, 2019
Slide 1: Driving Asset-Light Growth
HOTEL MARTINEZ DRIVING ASSET-LIGHT GROWTH I N V E S TO R M E E T I N G March 5, 2019 1
Slide 2: Welcome & Opening Remarks
HYATT PLACE PHUKET PATONG WELCOME & OPENING REMARKS BRAD O’BRYAN Treasurer and Senior Vice President, Investor Relations & Corporate Finance D R I V I N G A S S E T- L I G H T G R O W T H 2
Slide 3: Disclaimers
Disclaimers FORWARD-LOOKING STATEMENTS Forward-Looking Statements in this presentation, which are not historical facts, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include statements about our plans, strategies, outlook,
Slide 4: Overview of Agenda
PARK HYATT ABU DHABI OVERVIEW OF AGENDA MARK HOPLAMAZIAN Driving Industry-Leading Growth President & Chief Executive Officer MARK VONDRASEK Personalizing the Guest Chief Commercial Officer and Customer Experience BREAK Snacks and Refreshments JOAN BOTTARINI Transforming the Earnings Profile Chief Fi
Slide 5: Driving Asset-Light Growth
HOTEL MARTINEZ DRIVING ASSET-LIGHT GROWTH 5
Slide 6: Mark Hoplamazian
MIRAVAL AUSTIN MARK HOPLAMAZIAN President & Chief Executive Officer D R I V I N G A S S E T- L I G H T G R O W T H 6
Slide 7: Key Messages
Key Messages 1 Driving Industry-Leading Growth 2 Personalizing the Guest and Customer Experience 3 Transforming the Earnings Profile D R I V I N G A S S E T- L I G H T G R O W T H 7
Slide 8: Driving Industry-Leading Growth
PARK HYATT MALLORCA DRIVING INDUSTRY-LEADING GROWTH D R I V I N G A S S E T- L I G H T G R O W T H 8
Slide 9: Our Purpose: We Care for People So They Can Be Their Best
HYATT REGENCY LONDON – THE CHURCHILL OUR PURPOSE WE CARE FOR PEOPLE SO THEY CAN BE THEIR BEST D R I V I N G A S S E T- L I G H T G R O W T H 9
Slide 10: The House of Hyatt: Integrating Strategy with Execution
The House of Hyatt: Integrating Strategy with Execution OUR VISION: A world of understanding and care OUR MISSION: We deliver distinctive experiences for our guests OUR STRATEGY TO CREATE VALUE FOR COLLEAGUES, GUESTS, OWNERS AND SHAREHOLDERS MAXIMIZE INTEGRATE OPTIMIZE OUR CORE BUSINESS NEW GROWTH P
Slide 11: Maximizing Our Core Business
HYATT ZILARA CANCUN MAXIMIZING OUR CORE BUSINESS D R I V I N G A S S E T- L I G H T G R O W T H 11
Slide 12: Maximizing Our Core Business Drives
MAXIMIZE High-quality, differentiated brands and experiences that command a premium and drive frequency with Maximizing OUR CORE consumers BUSINESS Our Core Superior hotel economics that attract owners Business Drives and drive development Brand Enterprise Evolution RevPAR Margin Net rooms MEASURED
Slide 13: Hyatt's Brands Have Consistently Gained Share
System-wide RevPAR Index1 Change in bps +380 bps Hyatt’s Brands Have Consistently Gained Share 2014 2018 Hyatt’s system has gained market share for five consecutive years D R I V I N G A S S E T- L I G H T G R O W T H 1 Please refer to the Appendix for the Company’s definition of RevPAR Index. 13
Slide 14: Margins Driven by Hotel-Level Initiatives
Margins Driven by Hotel-Level Initiatives Hours Per Occupied Food & Beverage Room1 Margin % 4.903 Margin Enhancing Initiatives 25.6% • Labor scheduling “best practices” 4.788 • Food & Beverage initiatives including changes in room service, food outlets, and hours of operation 20.2% • Driving ancilla
Slide 15: Driving Hotel Economics
Driving Hotel Economics Hyatt Regency Mexico City Hyatt Regency Orlando Hyatt Regency Lake Tahoe • Acquired in 2012 for $190M and completed • Increased group mix, particularly higher- • Improved labor productivity by 11% from 2014 $36M renovation spending business groups, resulting to 2018 through i
Slide 16: Hyatt's Leading Net Rooms Growth
Net Rooms Growth 1 13.6% Hyatt’s Leading Net Rooms 7.0% Growth 6.5% 5.6% 6.7% 4.8% MARRIOTT MARRIOTT HILTON HILTON HYATT HYATT 2017 2018 1 Excluding the Two Roads acquisition, Hyatt’s net rooms grew 7.2% in 2018. D R I V I N G A S S E T- L I G H T G R O W T H Source: Company public filings. 16
Slide 17: Robust Pipeline Reflects Owner Preference
Robust Pipeline Reflects Owner Preference Rooms Pipeline Growth Projected System-wide Rooms ~89,000 ~ 300,000 Total Pipeline = Estimated1 ~ 211,000 Management & Franchise Fees of ~27,000 +$240M ~ 89,000 2009 2018 Rooms Pipeline Projected System- (at 12/31/2018) wide Rooms 1The Company’s forecast is
Slide 18: Pipeline Reflects Significant Managed & Franchise Mix
Pipeline Reflects Significant Managed & Franchise Mix Existing Rooms Pipeline Rooms Illustrative System 8% 3% 7% 27% 31% 32% 60% 70% 62% Managed Franchised O&L Existing Rooms data as of 12/31/2018. The Company’s forecasts are based on a number of assumptions that are subject to change and many of wh
Slide 19: Pipeline Reflects Significant International Shift
Pipeline Reflects Significant International Shift Existing Rooms Pipeline Rooms Illustrative System 12% 26% 16% 34% 19% 25% 59% 69% 40% AMERICAS ASPAC EAME/SWA Existing Rooms data as of 12/31/2018. The Company’s forecasts are based on a number of assumptions that are subject to change and many of wh
Slide 20: Hyatt Has Significant Runway for Growth
Hyatt Has Significant Runway for Growth Nashville London Shanghai 60 60 50 45 50 50 40 40 35 # of hotels # of hotels # of hotels 40 30 30 30 25 20 20 20 15 10 10 10 5 0 0 0 Hyatt Existing Hyatt Pipeline Hilton IHG Marriott Source: Smith Travel Research. The Company’s forecasts are based on a number
Slide 21: Integrating New Growth Platforms
PARK HYATT VIENNA INTEGRATING NEW GROWTH PLATFORMS D R I V I N G A S S E T- L I G H T G R O W T H 21
Slide 22: Hotel 50 Bowery
HOTEL 50 BOWERY + D R I V I N G A S S E T- L I G H T G R O W T H 22
Slide 23: Two Roads Hospitality LLC Transaction Overview
Asset-light acquisition Five lifestyle hotel brands HIGHLIGHTS 65 hotel properties (~12,000 rooms) Two Roads 10 condominium ownership properties (~1,500 units) Hospitality 35 properties (~5,000 rooms) in executed pipeline LLC Purchase price of $405 million Transaction FINANCIAL Potential additional
Slide 24: Two Roads Acquisition Dimensions of Value
TWO ROADS Acquisition Dimensions of Value 1 Addition of unique brands; established Lifestyle division 2 Expanded market coverage to serve complementary customer base 3 Accretive and growing pipeline D R I V I N G A S S E T- L I G H T G R O W T H 24
Slide 25: New Brands at a Glance
New Brands at a Glance PROPERTY CHAIN BRAND PERSONALITY COUNT SCALE To craft rare and Upper intimate life 17 Upscale experiences ALILA SEMINYAK To share & discover the soul of each 24 Luxury unique resort destination L'AUBERGE DEL MAR To evoke thought HOTEL 50 BOWERY CALIFORNIA through in-the-know 9
Slide 26: Our Brands
Our Brands TIMELESS PORTFOLIO BOUNDLESS PORTFOLIO INDEPENDENT PORTFOLIO D R I V I N G A S S E T- L I G H T G R O W T H 26
Slide 27: Two Roads Acquisition Dimensions of Value
TWO ROADS Acquisition Dimensions of Value 1 Addition of unique brands; established Lifestyle division 2 Expanded market coverage to serve complementary customer base 3 Accretive and growing pipeline D R I V I N G A S S E T- L I G H T G R O W T H 27
Slide 28: Focused on High-End Travelers
2018 System-wide Average Daily Rate (ADR) $348 Focused $311 on $241 High-End $229 $226 $180 Travelers $155 $131 Park Andaz Two Hyatt Grand Hyatt Hyatt Hyatt Hyatt Roads1 Centric Hyatt Regency House Place 1Two Roads system-wide average daily rate (“ADR”) reflects an estimate for all hotel properties
Slide 29: Opportunity for Meaningful Growth
GRAND HYATT KAUAI Collective Opportunities Across Brand Portfolio Incentive group business: opportunity to provide more locations to existing group customers in order to hold incentive meetings for top performing colleagues Opportunity for Meaningful Growth Resort offerings: opportunity to provide m
Slide 30: Two Roads Expands Market Coverage
TWO ROADS Expands Market Coverage Americas Suncadia Resort The Cliff House Resort & Spa Skamania Lodge Sunriver Resort The Lodge at Spruce Peak ASPAC Hotel Avante Alila Yangshuo Wild Dunes Resort EAME / SW Asia Alila Wuzhen L’Auberge de Sedona Alila Fort Bishangharh Orchards Inn Alila Jabal Akdhar A
Slide 31: Two Roads Acquisition Dimensions of Value
TWO ROADS Acquisition Dimensions of Value 1 Addition of unique brands; established Lifestyle division 2 Expanded market coverage to serve complementary customer base 3 Accretive and growing pipeline D R I V I N G A S S E T- L I G H T G R O W T H 31
Slide 32: Two Roads Offers a Meaningful Pipeline
Two Roads Offers a Meaningful Pipeline Current LOI Late-Stage Accretive and Pipeline Stage Discussions Growing Pipeline # Hotels: 35 ~15 >40 # Rooms: 5,000 ~2,000 >7,000 LOI Stage and late stage Two Roads branded pipeline deals are subject to change. The Company’s forecasts are based on a number of
Slide 33: Opportunity to Drive Owner Preference
Enhancing Performance Opportunity Hyatt to Drive vs U.S. Managed Resorts Owner Preference Hyatt’s • Operate at +500 bps overall margin premiums U.S. managed • Are ~9% more labor efficient1 resorts on average: • Operate at 10-15 point RevPAR Index2 premiums 1 Labor efficiency, as measured by “Hours P
Slide 34: Driving Continued Growth
ANDAZ SINGAPORE DRIVING CONTINUED GROWTH D R I V I N G A S S E T- L I G H T G R O W T H 32
Slide 35: Criteria for Future Growth Investments
PARK HYATT CHICAGO Criteria for Future Growth Investments Complementary or adjacent customer base Significant embedded and prospective growth Opportunity Fee-based earnings For Meaningful Other Considerations Growth Expands geographic footprint Offers compelling guest experience D R I V I N G A S S
Slide 36: Driving Asset-Light Growth
GRAND HYATT HONG KONG DRIVING ASSET-LIGHT GROWTH 36
Slide 37: Personalizing the Guest and Customer Experience
PARK HYATT CHICAGO PERSONALIZING THE GUEST AND CUSTOMER EXPERIENCE MARK VONDRASEK Chief Commercial Officer D R I V I N G A S S E T- L I G H T G R O W T H 37
Slide 38: Heightened Focus
Heightened Focus OUR VISION: A world of understanding and care OUR MISSION: We deliver distinctive experiences for our guests OUR STRATEGY TO CREATE VALUE FOR COLLEAGUES, GUESTS, OWNERS AND SHAREHOLDERS MAXIMIZE INTEGRATE OPTIMIZE OUR CORE BUSINESS NEW GROWTH PLATFORMS CAPITAL DEPLOYMENT OUR PLAN TO
Slide 39: Structured for Agility - One Commercial Services Team
Structured Structuredfor forAgility Agility - One Commercial Services Team Global Sales, Revenue Management Global Brands Wellbeing & Distribution Strategy Global Contact Centers Digital 7 Groups Global Communications 1 Guest-centric Team World Of Hyatt & Consumer Insights D R I V I N G A S S E T- L
Slide 40: A Strategy Centered on Listening
A Strategy Centered on Listening RESPONDING to member, customer & owner feedback STRENGTHENING differentiation D R I V I N G A S S E T- L I G H T G R O W T H 40
Slide 41: Winning Guest and Customer Preference Through True Points of Difference
Winning Guest and Customer Preference Through True Points of Difference Strong Brand Portfolio Wellbeing At Hyatt Exhale Flat Iron Miraval Tucson Alila Seminyak Exhale Flat Iron Digital Evolution Advancing Loyalty Park Hyatt Aviara Andaz Maui D R I V I N G A S S E T- L I G H T G R O W T H 41
Slide 42: Strong Brand Portfolio
THE CONFIDANTE HYATT CENTRIC GUATEMALA CITY PARK HYATT GUANGZHOU STRONG BRAND PORTFOLIO D R I V I N G A S S E T- L I G H T G R O W T H 6 42 42
Slide 43: Our Portfolio
Our Portfolio TIMELESS BOUNDLESS INDEPENDENT PORTFOLIO PORTFOLIO COLLECTIONS Rooted in tradition Reflective of today’s culture One-of-a-kind D R I V I N G A S S E T- L I G H T G R O W T H 43
Slide 44: Our Brands
Our Brands TIMELESS PORTFOLIO BOUNDLESS PORTFOLIO INDEPENDENT PORTFOLIO D R I V I N G A S S E T- L I G H T G R O W T H 44
Slide 45: Wellbeing at Hyatt
Miraval Tuscon Miraval Austin Alila MIRAVAL TUCSON ALILA SEMINYAK MIRAVAL AUSTIN EXHALE WELLBEING AT HYATT D R I V I N G A S S E T- L I G H T G R O W T H 6 45 45
Slide 46: Learning From and Scaling the Exemplary
Learning From and Scaling the Exemplary D R I V I N G A S S E T- L I G H T G R O W T H 46
Slide 47: Incorporating Wellbeing Across the Organization
Incorporating Wellbeing Across the Park Hyatt Aviara Resort, Golf Club & Spa Surfing with Executive Chef Pierre Albaladejo Organization Wellbeing-focused Meeting Planning Andrea Rush Exclusive Hike and Yoga Among the Redwoods D R I V I N G A S S E T- L I G H T G R O W T H 47
Slide 48: Digital Evolution
ANDAZ MAUI AT WAILEA RESORT ANDAZ LONDON LIVERPOOL STREET DIGITAL EVOLUTION D R I V I N G A S S E T- L I G H T G R O W T H 6 48 48
Slide 49: Investing to Double our Digital Channel Mix by 2021
Investing to Double our Digital Channel Mix by 2021 OUR INVESTMENTS Redesigned World Re-imagined Enhanced of Hyatt app Hyatt.com Back-end Technology PERSONALIZED • Intuitive interface gives • Excites guests for their • Generates hyper-relevant members more control over current stay and inspires offe
Slide 50: Our App - Changing How Members Travel
Our App - Changing How Members Travel Flexibility to schedule the entire stay Streaming experiences to help maintain daily routine Content and offers based on member likes and brand experiences Two-way chat and immediate in-stay feedback D R I V I N G A S S E T- L I G H T G R O W T H 50
Slide 51: Evolving Hyatt.com to Grow Digital Commerce
Evolving Hyatt.com to Grow Digital Commerce Editorial-inspired property exploration Immersive visual storytelling of destination and brand Brand-focused Personalized and curated content and offers D R I V I N G A S S E T- L I G H T G R O W T H 51
Slide 52: Advancing Loyalty
HYATT REGENCY CHONGQING ANDAZ LONDON LIVERPOOL STREET ADVANCING LOYALTY D R I V I N G A S S E T- L I G H T G R O W T H 6 52 53
Slide 53: World of Hyatt – Built on Our Purpose of Care and Competitive Differentiation
World of Hyatt – Built on Our Purpose of Care and Competitive Differentiation GLOBALIST DISCOVERIST 60 Tier-Qualifying Nights or 10 Tier-Qualifying Nights or Confirmed suite 100,000 Base Points or 25,000 Base Points or Guest upgrades at time 20 Qualifying Meetings 3 Qualifying Meetings of Honor of b
Slide 54: Listening Leads to Program Evolution
Listening Leads to Program Evolution 4X Bonus Points for spend Wellbeing experiences 165+ SLH properties Dual currency earning at Hyatt across food, fitness and adventure integrated primarily in Europe Elite recognition tier 2X Bonus Points on fitness Authentic and local 14 new countries added to re
Slide 55: Program Reach Expands Through Asset-Light Growth
Program Reach Expands Through Asset-Light Growth 2017 2019 185 NEW CITIES 360 ADDITIONAL HOTELS The Company’s forecasts are based on a number of assumptions that are subject to change and many of which are outside the control of the D R I V I N G A S S E T- L I G H T G R O W T H Company. If actual
Slide 56: We Are Seeing Strong Results
WeWe areare Seeing Seeing Strong Strong Results Results Active Members are Growing 2018 growth rate +22% World of Hyatt Penetration New Members are Growing 2018 growth rate +47% 38% Spend More +29% +10% Average spend more Higher ADR than non-members 35% per stay than non-members Stay More +31% 2018
Slide 57: And Our Industry is Taking Note
And Our Industry is Taking Note The new World of Hyatt Credit Card launches today, a new rewards card from Chase and Hyatt that’s a genuine improvement on the hotel brand’s previous Starwood has generally been regarded as the most popular hotel offering. The updated card earns users more of Hyatt pu
Slide 58: Winning Guest and Customer Preference Through True Points of Difference
Winning Guest and Customer Preference Through True Points of Difference Exhale Flat Iron Miraval Tucson Alila Seminyak Exhale Flat Iron Strong Brand Portfolio Wellbeing at Hyatt Park Hyatt Aviara Andaz Maui Digital Evolution Advancing Loyalty D R I V I N G A S S E T- L I G H T G R O W T H 58
Slide 59: Driving Asset-Light Growth
ANDAZ COSTA RICA RESORT AT PENINSULA PAPAGAYO DRIVING ASSET-LIGHT GROWTH 59
Slide 60: Transforming the Earnings Profile
ANDAZ AMSTERDAM PRINSENGRACHT TRANSFORMING THE EARNINGS PROFILE JOAN BOTTARINI Chief Financial Officer D R I V I N G A S S E T- L I G H T G R O W T H 60
Slide 61: Strong Finish to 2018
Strong Finish to 2018 System-wide RevPAR Net Rooms Growth Management, Franchise & Other Fees in constant currency +3.1% +7.2% +10.7% (incl. Two Roads) +13.6% Adjusted EBITDA† Net Income Shareholder Returns before transactions & foreign exchange +12.6% $ 769 Million +$ 1.0 Billion D R I V I N G A S S
Slide 62: Double-Digit Fee Growth
Double-Digit Fee Growth Managed & Franchised Rooms Total Management & Franchise Fees2 Excluding Two Roads1 $ millions 181,415 $ 552 91,415 $ 223 2009 2018 2009 2018 1Managed & Franchised rooms do not include owned & leased portfolio, vacation ownership, residential, branded spas and fitness studios,
Slide 63: Adjusted EBITDA Growth of ~13%
Adjusted EBITDA† Growth of ~13% $ 792M +2.0% $ 777M +5.0% +3.0% +3.0% $ 690M $ (102)M 2017 Actuals 2018 2017 Comparable NRG Comparable SG&A Leverage 2018 Actuals (as reported) (including RevPAR RevPAR (as reported) adjustments) Transactions Managed & Owned & and FX1 Franchised Leased 12018 includes
Slide 64: Our 2019 Outlook Is Solid
Our 2019 Outlook Is Solid System-wide RevPAR Net Rooms Growth in constant currency +1.0% to 3.0% +7.0% to 7.5% Adjusted EBITDA† Shareholder Returns $ 780 to $ 800M ~$ 300 Million The Company’s 2019 outlook is provided in Hyatt’s 4Q18 earnings release dated February 13, 2019. The Company’s forecasts
Slide 65: 2019 Investments Exceed Run-Rate
2019 Investments Exceed Run-Rate Adjusted SG&A† Capital Expenditures ~$ 345M1 ~$ 375M 1 Adjusted selling, general, and administrative expenses are expected to be approximately $345 million. This excludes approximately $35 million of stock-based compensation expense and any potential impact related t
Slide 66: 2019 Global Net Rooms Growth Outlook
2019 Global Net Rooms Growth Outlook Americas EAME / SW Asia ASPAC +4.0%-5.0% +16.0%-18.0% +9.0%-11.0% Full-Year 2019 Guidance Range: +7.0% to 7.5% The Company’s forecasts are based on a number of assumptions that are subject to change and many of which are outside the control of the Company. If act
Slide 67: Adjusted EBITDA Growth From 2017 to 2019F Expected to Be ~10%
Adjusted EBITDA† Growth From 2017 to 2019F is Expected to Be ~10% $792M +1.0% $790M +3.5% +3.5% +2.0% $ (102)M $657M $ (33)M 2017 Actuals 2018 2019 2017 Comparable NRG Comparable SG&A Leverage 2019 (as reported) (including RevPAR RevPAR Guidance adjustments) Midpoint Transactions Managed & Owned & &
Slide 68: Long-Term Earnings Growth Model is Refined
Long-Term Earnings Growth Model is Refined Illustrative Managed & Franchised Owned & Leased Adjusted +1% to 3% RevPAR Growth ~1% to 2% ~0% to 3% EBITDA† +6.5% to 7.5% Net Rooms Growth1 ~3% to 4% ----- Growth Subtotal ~4% to 6% ~0% to 3% 2019-2021F In percentage points of Total ~4% to 9% Adjusted EBI
Slide 69: Our Stated Capital Strategy November 2017
Our Stated Capital Strategy November 2017 1 Monetize higher EBITDA multiple assets 2 Provide funds for future growth investments / shareholder returns 3 Accelerate towards greater fee-based earnings D R I V I N G A S S E T- L I G H T G R O W T H 69
Slide 70: Sold Over $1.1B of $1.5B Commitment
1 Sold Over $ 1.1B of $ 1.5B Commitment Monetize higher Permanent Sell-Down Progress to Date EBITDA† multiple Since November 2017 | $ millions, pre-tax assets Hyatt Regency Scottsdale Resort & Spa at Gainey Ranch Royal Palms Resort and Spa, part of The Unbound 4Q17 ~$ 305 Collection by Hyatt Grand H
Slide 71: Our Stated Capital Strategy November 2017
Our Stated Capital Strategy November 2017 1 Monetize higher EBITDA multiple assets 2 Provide funds for future growth investments / shareholder returns 3 Accelerate towards greater fee-based earnings D R I V I N G A S S E T- L I G H T G R O W T H 71
Slide 72: Provide Funds for Future Growth: Two Roads
2 Acquired Two Roads Hospitality Provide funds for Added 65 hotel management and franchise agreements Added 10 condominium properties future growth investments / shareholder Added roughly 5,000 rooms to pipeline returns Expect Stabilized EBITDA† multiple ~12x by 2021 The Company’s forecasts are base
Slide 73: Provide Funds for Future Growth
2 Provide 2018 Initial Total shareholder return guidance $ 300M funds for future growth > $ 800M Permanent sell-down disposition proceeds (pre-tax) investments / ~ $ (400M) Acquisition of Two Roads shareholder ~ $ 300M Asset recycling proceeds (net, pre-tax) returns 2018 Total shareholder return – r
Slide 74: Asset Recycling Activity
Dispositions Under Recycling in 2018 | $ millions, pre-tax Hyatt Regency Coconut Point Resort and Spa 1Q18 ~$ 200 Hyatt Regency Mexico City 3Q18 ~$ 365 Total dispositions as part of recycling program ~$ 565 Asset Average estimated forward EBITDA† multiple ~13.0x recycling activity Acquisitions Under
Slide 75: Record Returns to Shareholders in 2018
Record Returns to Shareholders in 2018 Total Shareholder Returns 1,034 Returned Over $ 1.0B in 2018 $ Millions CASH DIVIDEND SHARE REPURCHASES REPURCHASED REPURCHASED 715 723 Initiated quarterly Repurchased cash dividend $ 966M of shares of $ 0.15/share in 2018 445 in 1Q18 396 Increased quarterly In
Slide 76: Our Stated Capital Strategy November 2017
Our Stated Capital Strategy November 2017 1 Monetize higher EBITDA multiple assets 2 Provide funds for future growth investments/shareholder returns 3 Accelerate towards greater fee-based earnings D R I V I N G A S S E T- L I G H T G R O W T H 76
Slide 77: Adjusted EBITDA by Business Mix
3 Adjusted EBITDA† by Business Mix Accelerate towards 2009 2016 2018 greater fee-based earnings M&F 37% M&F 43% O&L 47% M&F O&L O&L 53% 63% 57% M&F Contribution1 M&F Contribution1 +600 bps +1,000 bps Over 2 Years Earnings composition percentages above exclude Corporate & Other and eliminations. Earn
Slide 78: Our Evolved Capital Strategy March 2019
Our Evolved Capital Strategy March 2019 1 Monetize additional owned assets 2 Provide funds for future growth investments / shareholder returns 3 Accelerate towards greater fee-based earnings D R I V I N G A S S E T- L I G H T G R O W T H 78
Slide 79: Monetize Additional Owned Assets
1 Monetize additional owned assets $ 1.145B $ 0.3B $ 1.445B $ 1.5B $ 2.9B The Company’s forecasts are based on a number of assumptions that are subject to change and many of which are outside the control of the Company. If actual results vary from these assumptions, the Company’s expectations may ch
Slide 80: Expanded Commitment for $1.5B
Expanded $ 1.5B permanent sell-down commitment results in meaningful reduction in asset base Expanded Anticipate average EBITDA valuation multiple to approximate 13x-15x commitment Estimated tax impact of approximately 15% on average for $ 1.5B in gross dispositions Anticipated benefits of dispositi
Slide 81: Our Evolved Capital Strategy March 2019
Our Evolved Capital Strategy March 2019 1 Monetize additional owned assets 2 Provide funds for future growth investments / shareholder returns 3 Accelerate towards greater fee-based earnings D R I V I N G A S S E T- L I G H T G R O W T H 81
Slide 82: Re-investment Priorities
2 Re-investment Priorities Provide funds 1. Seeking asset-light platforms to acquire for future growth investments / 2. Share repurchases shareholder returns Continue to OPTIMIZE resources to support our growth D R I V I N G A S S E T- L I G H T G R O W T H 82
Slide 83: Our Evolved Capital Strategy March 2019
Our Evolved Capital Strategy March 2019 1 Monetize additional owned assets 2 Provide funds for future growth investments / shareholder returns 3 Accelerate towards greater fee-based earnings D R I V I N G A S S E T- L I G H T G R O W T H 83
Slide 84: Expected Outcomes: Adjusted EBITDA by Business Mix
3 Expected Outcomes Adjusted EBITDA† by Business Mix Accelerate towards 2018 Illustrative March 2022 2023 + beyond greater fee-based Ongoing shift earnings O&L O&L 33% +100-200bps 47% M&F 53% M&F per year 67% as a result of growth in M&F segments M&F Contribution1 +1,400 bps Earnings composition per
Slide 85: Transforming the Earnings Profile
Accelerating earnings mix shift – monetizing owned assets Investing in asset-light platforms Transforming Returning cash to shareholders the earnings profile While... Delivering industry-leading net rooms growth Driving strong topline and margin expansion Investing in resources for growth Maintainin
Slide 86: Driving Asset-Light Growth
PARK HYATT CHENNAI DRIVING ASSET-LIGHT GROWTH 86
Slide 87: Chairman's Remarks
CHAIRMAN’S REMARKS TOM PRITZKER Executive Chairman of the Board DRIVING ASSET-LIGHT GROWTH 87
Slide 88: Driving Asset-Light Growth
HOTEL MARTINEZ DRIVING ASSET-LIGHT GROWTH 88
Slide 89: Appendix
APPENDIX DRIVING ASSET-LIGHT GROW
Slide 90: Definitions
Definitions Adjusted Earnings Before Interest Expense, Taxes, Depreciation and Amortization (Adjusted EBITDA) and EBITDA We use the terms Adjusted EBITDA and EBITDA throughout this presentation. Adjusted EBITDA and EBITDA, as the Company defines them, are non- GAAP measures. We define consolidated A
Slide 91: Definitions
Definitions We calculate consolidated Adjusted EBITDA by adding the Adjusted EBITDA of each of our reportable segments and eliminations to corporate and other Adjusted EBITDA. Our board of directors and executive management team focus on Adjusted EBITDA as a key performance and compensation measure
Slide 92: Definitions
Definitions Adjusted Net Income Adjusted net income, as we define it, is a non-GAAP measure. We define Adjusted net income as net income attributable to Hyatt Hotels Corporation excluding special items, which are those items deemed not to be reflective of ongoing operations. We consider Adjusted net
Slide 93: Definitions
Definitions Comparable Hotels "Comparable system-wide hotels" represents all properties we manage or franchise (including owned and leased properties) and that are operated for the entirety of the periods being compared and that have not sustained substantial damage, business interruption or undergo
Slide 94: Definitions
Definitions Revenue per Available Room (RevPAR) RevPAR is the product of the average daily rate (ADR) and the average daily occupancy percentage. RevPAR does not include non-room revenues, which consist of ancillary revenues generated by a hotel property, such as food and beverage, parking, and othe
Slide 95: Reconciliation of Non-GAAP to GAAP Financial Measures
Reconciliation of Non-GAAP to GAAP Financial Measures Net Income, EBITDAƗ, Adjusted EBITDAƗ ($ in millions) 2009 (a) 2016 (b) 2017 (b) 2018 Net income (loss) attributable to Hyatt Hotels Corporation $ (43) $ 206 $ 389 $ 769 Interest expense 56 76 80 76 Provision for income taxes (8) 76 332 182 Depre
Slide 96: Non-GAAP Financial Measure: 2019 Forecast Range
Non-GAAP Financial Measure Net Income, EBITDAƗ, and Adjusted EBITDAƗ ($ in millions) 2019 Forecast Range Low Case High Case Net income (loss) attributable to Hyatt Hotels Corporation $ 109 $ 147 Interest expense 79 78 Provision for income taxes 47 57 Depreciation and amortization 352 347 EBITDA 587
Slide 97: Net Impact of Portfolio Changes to Adjusted EBITDA 2017 v. 2018
Year-over-Year Net Impact of Portfolio Changes to HHC Adjusted EBITDA† 2017 v. 2018 ($ in millions) Full-Year Transaction / Property Rooms Opening Date Dispositions Owned and Leased Hyatt Regency Grand Cypress 815 2Q17 Hyatt Regency Louisville 393 2Q17 Royal Palms Resort and Spa, part of The Unbound
Slide 98: Net Impact of Portfolio Changes to Adjusted EBITDA 2017 v. 2018
Year-over-Year Net Impact of Portfolio Changes to HHC Adjusted EBITDA† 2017 v. 2018 ($ in millions) Acquisitions or Openings Owned and Leased Hyatt House Irvine / John Wayne Airport 149 4Q17 Hyatt Place São José do Rio Preto 152 2Q18 Hyatt Place Macaé 141 2Q18 Hyatt Regency Phoenix 693 3Q18 Hyatt Re
Slide 99: Net Impact of Portfolio Changes to Adjusted EBITDA 2018 v. 2019E
Year-over-Year Net Impact of Portfolio Changes to HHC Adjusted EBITDA† 2018 v. 2019E ($ in millions) Full-Year Transaction / Property Rooms Opening Date Dispositions Owned and Leased Andaz Maui at Wailea Resort 301 1Q18 Grand Hyatt San Francisco 668 1Q18 Hyatt Regency Coconut Point Resort and Spa 45
Slide 100: Net Impact of Portfolio Changes to Adjusted EBITDA 2018 v. 2019E
Year-over-Year Net Impact of Portfolio Changes to HHC Adjusted EBITDA† 2018 v. 2019E ($ in millions) Acquisitions or Openings Owned and Leased Hyatt Place São José do Rio Preto 152 2Q18 Hyatt Place Macaé 141 2Q18 Hyatt Regency Phoenix 693 3Q18 Hyatt Regency Indian Wells Resort & Spa 530 3Q18 Future
Slide 101: Driving Asset-Light Growth
HOTEL MARTINEZ DRIVING ASSET-LIGHT GROWTH 101