Document and Entity Information
Document and Entity Information Document - shares | 3 Months Ended | |
Mar. 31, 2017 | Apr. 26, 2017 | |
Entity Information [Line Items] | ||
Entity Registrant Name | Hilton Worldwide Holdings Inc. | |
Entity Central Index Key | 1,585,689 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Trading Symbol | hlt | |
Entity Common Stock, Shares Outstanding | 328,781,212 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | |
Current Assets: | |||
Cash and cash equivalents | $ 862 | $ 1,062 | |
Restricted cash and cash equivalents | 124 | 121 | |
Accounts receivable, net of allowance for doubtful accounts | 911 | 755 | |
Prepaid expenses | 129 | 89 | |
Income taxes receivable | 0 | 13 | |
Other | 43 | 39 | |
Current assets of discontinued operations | 0 | 1,478 | |
Total current assets | 2,069 | 3,557 | |
Intangibles and Other Assets: | |||
Goodwill | 5,135 | 5,218 | |
Brands | [1] | 4,856 | 4,848 |
Management and franchise contracts, net | 930 | 963 | |
Other intangible assets, net | 431 | 447 | |
Property and equipment, net | 341 | 341 | |
Deferred income tax assets | 82 | 82 | |
Other | 443 | 408 | |
Non-current assets of discontinued operations | 0 | 10,347 | |
Total intangibles and other assets | 12,218 | 22,654 | |
Total assets | 14,287 | 26,211 | |
Current Liabilities: | |||
Accounts payable, accrued expenses and other | 1,798 | 1,821 | |
Current maturities of long-term debt | [2] | 41 | 33 |
Income taxes payable | 128 | 56 | |
Current liabilities of discontinued operations | 0 | 774 | |
Total current liabilities | 1,967 | 2,684 | |
Long-term debt | 6,588 | 6,583 | |
Deferred revenues | 22 | 42 | |
Deferred income tax liabilities | 1,723 | 1,778 | |
Liability for guest loyalty program | 898 | 889 | |
Other | 1,493 | 1,492 | |
Non-current liabilities of discontinued operations | 0 | 6,894 | |
Total liabilities | 12,691 | 20,362 | |
Commitments and contingencies - see Note 14 | |||
Equity: | |||
Preferred stock | 0 | 0 | |
Common stock | [3] | 3 | 3 |
Treasury stock, at cost | (70) | 0 | |
Additional paid-in capital | [3] | 10,214 | 10,220 |
Accumulated deficit | (7,631) | (3,323) | |
Accumulated other comprehensive loss | (918) | (1,001) | |
Total Hilton stockholders' equity | 1,598 | 5,899 | |
Noncontrolling interests | (2) | (50) | |
Total equity | 1,596 | 5,849 | |
Total liabilities and equity | $ 14,287 | $ 26,211 | |
[1] | Represents intangible assets that were initially recorded at their fair value as part of the October 24, 2007 transaction whereby we became a wholly owned subsidiary of an affiliate of Blackstone (the "Merger"). | ||
[2] | Net of unamortized deferred financing costs and discount attributable to current maturities of long-term debt. | ||
[3] | Adjusted to reflect the 1-for-3 reverse stock split that occurred on January 3, 2017. See Note 1: "Organization and Basis of Presentation" for additional information. |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | |
Statement of Financial Position [Abstract] | |||
Allowance for doubtful accounts | $ 28 | $ 27 | |
Variable interest entities - current assets | 74 | 167 | |
Variable interest entities - total intangibles and other assets | 172 | 569 | |
Variable interest entities - current liabilities | 44 | 124 | |
Variable interest entities - liabilities | $ 270 | $ 766 | |
Preferred stock, par value (per share) | $ 0.01 | $ 0.01 | |
Preferred stock, authorized shares | 3,000,000,000 | 3,000,000,000 | |
Preferred stock, issued shares | 0 | 0 | |
Preferred stock, outstanding shares | 0 | 0 | |
Common stock, par value (per share) | $ 0.01 | $ 0.01 | |
Common stock, authorized shares | [1] | 10,000,000,000 | 10,000,000,000 |
Common stock, issued shares | [1] | 330,851,894 | 329,351,581 |
Common stock, outstanding shares | [1] | 329,628,890 | 329,341,992 |
Treasury stock, shares | 1,223,004 | 9,589 | |
[1] | Adjusted to reflect the 1-for-3 reverse stock split that occurred on January 3, 2017. See Note 1: "Organization and Basis of Presentation" for additional information. |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Revenues | |||
Franchise fees | $ 294 | $ 253 | |
Base and other management fees | 83 | 60 | |
Incentive management fees | 52 | 36 | |
Owned and leased hotels | 300 | 319 | |
Other revenues | 37 | 17 | |
Total revenues excluding reimbursement revenue | 766 | 685 | |
Other revenues from managed and franchised properties | 1,395 | 1,041 | |
Total revenues | 2,161 | 1,726 | |
Expenses | |||
Owned and leased hotels | 272 | 307 | |
Depreciation and amortization | 89 | 92 | |
Impairment loss | 0 | 15 | |
General and administrative | 105 | 83 | |
Other expenses | 23 | 18 | |
Total expenses excluding cost of reimbursable expense | 489 | 515 | |
Other expenses from managed and franchised properties | 1,395 | 1,041 | |
Total expenses | 1,884 | 1,556 | |
Operating income | 277 | 170 | |
Interest expense | (104) | (90) | |
Loss on foreign currency transactions | (4) | (12) | |
Loss on debt extinguishment | (60) | 0 | |
Other non-operating income, net | 1 | 2 | |
Income from continuing operations before income taxes | 110 | 70 | |
Income tax benefit (expense) | (35) | 121 | |
Income from continuing operations, net of taxes | 75 | 191 | |
Income from discontinued operations, net of taxes | 0 | 119 | |
Net income | 75 | 310 | |
Net income attributable to noncontrolling interests | (1) | (1) | |
Net income attributable to Hilton stockholders | $ 74 | $ 309 | |
Earnings per share, basic | |||
Net income from continuing operations per share, basic | $ 0.22 | $ 0.58 | [1] |
Net income from discontinued operations per share, basic | 0 | 0.36 | [1] |
Net income per share, basic | 0.22 | 0.94 | [1] |
Earnings per share, diluted | |||
Net income from continuing operations per share, diluted | 0.22 | 0.58 | [1] |
Net income from discontinued operations per share, diluted | 0 | 0.36 | [1] |
Net income per share, diluted | 0.22 | 0.94 | [1] |
Cash dividends declared per share | $ 0.15 | $ 0.21 | [1] |
[1] | Weighted average shares outstanding used in the computation of basic and diluted earnings per share and cash dividends declared per share were adjusted to reflect the 1-for-3Â reverse stock split that occurred on January 3, 2017. See Note 1: "Organization and Basis of Presentation" for additional information. |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Operations Condensed Consolidated Statements of Operations (Parentheticals) | 3 Months Ended |
Mar. 31, 2017 | |
Income Statement [Abstract] | |
Reverse stock split | 1-for-3 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 75 | $ 310 |
Other comprehensive income (loss), net of tax benefit (expense): | ||
Currency translation adjustment | 20 | 13 |
Pension liability adjustment | 1 | 1 |
Cash flow hedge adjustment | (2) | (6) |
Total other comprehensive income | 19 | 8 |
Comprehensive income | 94 | 318 |
Comprehensive loss attributable to noncontrolling interests | 0 | 1 |
Comprehensive income attributable to Hilton stockholders | $ 94 | $ 319 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Comprehensive Income (Parentheticals) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Statement of Comprehensive Income [Abstract] | ||
Foreign currency translation adjustment, tax | $ 1 | $ (3) |
Pension liability adjustment, tax | (1) | (1) |
Cash flow hedge adjustment, tax | $ 2 | $ 4 |
Condensed Consolidated Stateme8
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating Activities: | ||
Net income | $ 75 | $ 310 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 89 | 92 |
Depreciation and amortization, including discontinued operations | 169 | |
Impairment loss | 0 | 15 |
Loss on foreign currency transactions | 4 | 12 |
Loss on debt extinguishment | 60 | 0 |
Share-based compensation | 15 | 11 |
Deferred income taxes | (51) | (32) |
Working capital changes and other | (129) | (146) |
Net cash provided by operating activities | 63 | 339 |
Investing Activities: | ||
Capital expenditures for property and equipment | (9) | (84) |
Contract acquisition costs | (13) | (9) |
Capitalized software costs | (9) | (11) |
Other | (19) | (6) |
Net cash used in investing activities | (50) | (110) |
Financing Activities: | ||
Borrowings | 1,823 | 0 |
Repayment of debt | (1,824) | (32) |
Debt issuance costs and redemption premium | (66) | 0 |
Dividends paid | (49) | (69) |
Cash transferred in spin-offs of Park and HGV | (501) | 0 |
Repurchases of common stock | (70) | 0 |
Distributions to noncontrolling interests | (1) | (2) |
Tax withholdings on share-based compensation | (28) | (13) |
Net cash used in financing activities | (716) | (116) |
Effect of exchange rate changes on cash, restricted cash and cash equivalents | 5 | 4 |
Net increase (decrease) in cash, restricted cash and cash equivalents | (698) | 117 |
Cash, restricted cash and cash equivalents from continuing operations, beginning of period | 1,183 | 634 |
Cash, restricted cash and cash equivalents from discontinued operations, beginning of period | 501 | 222 |
Cash, restricted cash and cash equivalents, beginning of period | 1,684 | 856 |
Cash, restricted cash and cash equivalents from continuing operations, end of period | 986 | 682 |
Cash, restricted cash and cash equivalents from discontinued operations, end of period | 0 | 291 |
Cash, restricted cash and cash equivalents, end of period | 986 | 973 |
Supplemental Disclosures: | ||
Interest | 113 | 86 |
Income taxes, net of refunds | 6 | 39 |
Conversion of Park's property and equipment to timeshare inventory of HGV (investing activities) | 0 | (22) |
Non-cash spin-offs of Park and HGV (financing activities) | $ 29 | $ 0 |
Organization and Basis of Prese
Organization and Basis of Presentation | 3 Months Ended |
Mar. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation Organization Hilton Worldwide Holdings Inc. (the "Parent," or together with its subsidiaries, "Hilton," "we," "us," "our" or the "Company"), a Delaware corporation, is one of the largest hospitality companies in the world and is engaged in managing, franchising, owning and leasing hotels and resorts, including timeshare properties. As of March 31, 2017 , we managed, franchised, owned or leased 4,982 hotel and resort properties, totaling 812,341 rooms in 103 countries and territories. On March 15, 2017, HNA Tourism Group Co., Ltd. and certain of its affiliates (together, "HNA") acquired 82.5 million shares of Hilton common stock, representing approximately a 25.0 percent equity interest in the common stock of the Parent, from affiliates of The Blackstone Group L.P. ("Blackstone"). As of March 31, 2017 , HNA and affiliates of Blackstone beneficially owned approximately 25.0 percent and 15.2 percent of our common stock, respectively. Spin-offs On January 3, 2017, we completed the spin-offs of a portfolio of hotels and resorts, as well as our timeshare business, into two independent, publicly traded companies: Park Hotels & Resorts Inc. ("Park") and Hilton Grand Vacations Inc. ("HGV"), respectively, (the "spin-offs"). See Note 3: "Discontinued Operations" for additional information. Reverse Stock Split On January 3, 2017, we completed a 1-for-3 reverse stock split of Hilton's outstanding common stock (the "Reverse Stock Split"). The authorized number of shares of common stock was reduced from 30,000,000,000 to 10,000,000,000 , par value remained $0.01 per share and the authorized number of shares of preferred stock remained 3,000,000,000 . Stockholders entitled to fractional shares as a result of the Reverse Stock Split received a cash payment in lieu of receiving fractional shares. All share and share-related information presented in these condensed consolidated financial statements have been retroactively adjusted in all periods presented to reflect the decreased number of shares resulting from the Reverse Stock Split. The retroactive adjustments resulted in the reclassification of $7 million from common stock to additional paid-in capital in the condensed consolidated balance sheets for all periods presented. Basis of Presentation The accompanying condensed consolidated financial statements for the three months ended March 31, 2017 and 2016 have been prepared in accordance with United States of America ("U.S.") generally accepted accounting principles ("GAAP") and are unaudited. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with U.S. GAAP. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended December 31, 2016 . The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and, accordingly, ultimate results could differ from those estimates. Additionally, interim results are not necessarily indicative of full year performance. These condensed consolidated financial statements present the condensed consolidated financial position of Hilton as of March 31, 2017 and December 31, 2016 and the results of operations of Hilton for the three months ended March 31, 2017 and 2016 giving effect to the spin-offs, with the historical financial results of Park and HGV reflected as discontinued operations. Unless otherwise indicated, the information in the notes to the condensed consolidated financial statements refer only to Hilton's continuing operations and do not include discussion of balances or activity of Park or HGV. Principles of Consolidation In our opinion, the accompanying condensed consolidated financial statements reflect all adjustments, including normal recurring items, considered necessary for a fair presentation of the interim periods. All material intercompany transactions have been eliminated in consolidation. Reclassifications Certain amounts in previously issued financial statements have been reclassified to conform to the presentation following the spin-offs, which includes the reclassification of the financial position and results of operations of Park and HGV as discontinued operations as of December 31, 2016 and as of and for the three months ended March 31, 2016. Additionally, certain line items in the condensed consolidated statements of operations have been revised to reflect the operating structure of Hilton subsequent to the spin-offs. The primary change to the condensed consolidated statements of operations is the disaggregation of management and franchise fee revenues. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements Adopted Accounting Standards In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-04 ("ASU 2017-04"), Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . This ASU simplifies the subsequent measurement of goodwill by removing Step 2 from the goodwill impairment test. We elected, as permitted by the standard, to early adopt ASU 2017-04 on a prospective basis as of January 1, 2017. The adoption did not have a material effect on our condensed consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09 ("ASU 2016-09"), Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. This ASU is intended to simplify several aspects of the accounting for share-based payment transactions, including the accounting for income taxes, forfeitures and statutory withholding requirements, as well as classification in the statement of cash flows. We adopted ASU 2016-09 as of January 1, 2017. One of the provisions of this ASU requires entities to make an accounting policy election with respect to forfeitures of share-based payment awards, and we elected to account for forfeitures as they occur and adopted this provision of ASU 2016-09 using a modified retrospective approach by recording a cumulative-effect adjustment to equity as of January 1, 2017 of approximately $1 million . Additionally, we have applied the provisions of this ASU on a retrospective basis in our condensed consolidated statements of cash flows, which includes presenting: (i) excess tax benefits as an operating activity, which were previously presented as a financing activity; and (ii) cash payments to tax authorities for employee taxes when shares are withheld to meet statutory withholding requirements as a financing activity, which were previously presented as an operating activity. Accounting Standards Not Yet Adopted In February 2016, the FASB issued ASU No. 2016-02 ("ASU 2016-02"), Leases (Topic 842) , which supersedes existing guidance on accounting for leases in Leases (Topic 840) and generally requires all leases, including operating leases, to be recognized in the statement of financial position as right-of-use assets and lease liabilities by lessees. The provisions of ASU 2016-02 are to be applied using a modified retrospective approach and are effective for reporting periods beginning after December 15, 2018; early adoption is permitted. We are currently evaluating the effect that this ASU will have on our consolidated financial statements, but we expect this ASU to have a material effect on our consolidated balance sheet. In May 2014, the FASB issued ASU No. 2014-09 ("ASU 2014-09"), Revenue from Contracts with Customers (Topic 606) . This ASU supersedes the revenue recognition requirements in Revenue Recognition (Topic 605) and requires entities to recognize revenue when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. Subsequent to ASU 2014-09, the FASB issued several related ASUs. The provisions of ASU 2014-09 and the related ASUs will be effective beginning January 1, 2018. This ASU permits two transition approaches: retrospective or modified retrospective. We are still evaluating our transition approach and expect to reach a decision in the second quarter of 2017. We anticipate that ASU 2014-09 will have a material effect on our consolidated financial statements. However, we expect revenue recognition related to our accounting for ongoing royalty and management fee revenues, direct reimbursable fees from our management and franchise agreements and hotel guest transactions at our owned and leased hotels to remain substantially unchanged. While we are continuing to assess all other potential effects of the standard, we currently believe the provisions of ASU 2014-09 will affect revenue recognition as follows: (i) application and initiation fees for new hotels entering the system will be recognized over the term of the franchise agreement; (ii) certain contract acquisition costs related to our management and franchise agreements will be recognized over the term of the agreements as a reduction to revenue; and (iii) incentive management fees will be recognized to the extent that it is probable that a significant reversal will not occur as a result of future hotel profits or cash flows. We do not expect the changes in revenue recognition for certain contract acquisition costs or incentive management fees to affect the Company’s net income for any full year period. We are currently assessing the effect of the standard on indirect reimbursable fees related to our management and franchise agreements and the accounting for our guest loyalty program. We continue to update our assessment of the effect that ASU 2014-09 and related ASUs will have on our consolidated financial statements, and we will disclose further material effects, if any, when known. |
Discontinued Operations (Notes)
Discontinued Operations (Notes) | 3 Months Ended |
Mar. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations On January 3, 2017, we completed the spin-offs of Park and HGV via a pro rata distribution to each of Hilton's stockholders of record, as of close of business on December 15, 2016, of 100 percent of the outstanding common stock of each of Park and HGV (the "Distribution"). Each Hilton stockholder received one share of Park common stock for every five shares of Hilton common stock and one share of HGV common stock for every ten shares of Hilton common stock. Following the spin-offs, Hilton did not retain any ownership interest in Park or HGV. Both Park and HGV have their common stock listed on the New York Stock Exchange under the symbols "PK" and "HGV," respectively. In connection with the spin-offs, on January 2, 2017, Hilton entered into several agreements with Park and HGV that govern Hilton’s relationship with them following the Distribution, including the following: Distribution Agreement The Company entered into a Distribution Agreement with Park and HGV regarding the principal actions taken or to be taken in connection with the spin-offs. The Distribution Agreement provides for certain transfers of assets and assumptions of liabilities by each of Hilton, Park and HGV and the settlement or extinguishment of certain liabilities and other obligations among Hilton, Park and HGV. In addition to the allocation of assets and liabilities detailed in the Distribution Agreement, Hilton, Park and HGV have agreed that losses related to certain contingent liabilities (and related costs and expenses) that generally are not specifically attributable to any of the separated real estate business, the timeshare business or the retained business of Hilton will be apportioned among the parties according to fixed percentages: 65 percent , 26 percent and 9 percent for each of Hilton, Park and HGV, respectively. In addition, costs and expenses of, and indemnification obligations to, third-party professional advisors arising out of the foregoing actions also may be subject to these provisions. Subject to certain limitations and exceptions, Hilton shall generally be vested with the exclusive management and control of all matters pertaining to any such contingent liabilities, including the prosecution of any claim and the conduct of any defense. The Distribution Agreement also provides for cross-indemnities that, except as otherwise provided in the Distribution Agreement, are principally designed to place financial responsibility for the obligations and liabilities of each business with the appropriate company. Employee Matters Agreement The Company entered into an Employee Matters Agreement with Park and HGV that governs the respective rights, responsibilities and obligations of Hilton, Park and HGV after the spin-offs with respect to transferred employees, defined benefit pension plans, defined contribution plans, non-qualified retirement plans, employee health and welfare benefit plans, incentive plans, equity-based awards, collective bargaining agreements and other employment, compensation and benefits-related matters. Generally, other than with respect to certain specified compensation and benefit plans and liabilities, each of Park and HGV assumed or retained sponsorship of, and the liabilities relating to, compensation and benefit plans and employee-related liabilities relating to its current and former employees. Additionally, outstanding Hilton equity-based awards were equitably adjusted or converted into Park or HGV awards, as applicable, in connection with the spin-offs, and Park and HGV employees no longer actively participate in Hilton’s benefit plans or programs (other than specified compensation and benefit plans). Tax Matters Agreement The Company entered into a Tax Matters Agreement with Park and HGV that governs the respective rights, responsibilities and obligations of Hilton, Park and HGV after the spin-offs with respect to tax liabilities and benefits, tax attributes, tax contests and other tax sharing regarding U.S. federal, state, local and foreign income taxes, other tax matters and related tax returns. Park and HGV each continue to have several liability with Hilton to the Internal Revenue Service ("IRS") for the consolidated U.S. federal income taxes of the Hilton consolidated group relating to the taxable periods in which Park and HGV were part of that group. The Tax Matters Agreement specifies the portion, if any, of this tax liability for which Park and HGV will bear responsibility, and each party has agreed to indemnify the other two against any amounts for which they are not responsible. The Tax Matters Agreement also provides special rules for allocating tax liabilities in the event that the spin-offs are not tax-free. The Tax Matters Agreement also provides for certain covenants that may restrict Hilton, Park or HGV's ability to issue equity and pursue strategic or other transactions that otherwise could maximize the value of their businesses for two years after the spin-offs. These restrictions are generally inapplicable in the event that the IRS has granted a favorable ruling to Hilton, Park or HGV or in the event that Hilton, Park or HGV has received an opinion from a tax advisor that it can take such actions without adversely affecting the tax-free status of the spin-offs and related transactions. Transition Services Agreement The Company entered into a Transition Services Agreement (the "TSA") with Park and HGV under which Hilton or one of its affiliates will provide Park and HGV with certain services for a period of two years to help ensure an orderly transition following the Distribution. The services that Hilton agreed to provide under the TSA may include certain finance, information technology, human resources and compensation, facilities, legal and compliance and other services. The entity providing the services is compensated for any such services at agreed amounts as set forth in the TSA. HGV License Agreement The Company entered into a license agreement with HGV granting HGV the exclusive right, for an initial term of 100 years , to use certain Hilton marks and intellectual property in its timeshare business, subject to the terms and conditions of the agreement. HGV will pay a royalty fee of five percent of gross revenues, as defined, to Hilton quarterly in arrears, as well as specified additional fees. HGV also will pay Hilton an annual transition fee of $5 million for each of the first five years of the term and certain other fees and reimbursements. Additionally, during the term of the license agreement, HGV will participate in Hilton’s guest loyalty program, Hilton Honors. Tax Stockholders Agreement The Company entered into a stockholders agreement with HGV and certain entities affiliated with Blackstone intended to preserve the tax-free status of the Distribution. The Tax Stockholders Agreement provides for certain covenants that may limit issuances or repurchases of Hilton or HGV stock in excess of specified percentages, dispositions of Hilton or HGV common stock by Blackstone, and transfers of interests in certain Blackstone entities that directly or indirectly own Hilton, Park or HGV common stock. Additionally, the Tax Stockholders Agreement, which has a term of two years , may limit issuances or repurchases of stock by Hilton in excess of specified percentages. Management and Franchise Agreements The Company entered into management and franchise agreements with Park, whereby Park will pay agreed upon fees for various services that Hilton will provide to support the operations of their hotels, as well as royalty fees for the licensing of Hilton's hotel brands. The terms of the management agreements generally include a base management fee, calculated as three percent of gross hotel revenues or receipts, and an incentive management fee, calculated as six percent of a specified measure of hotel earnings that will be calculated in accordance with the applicable management agreement. Additionally, payroll and related costs, certain other operating costs, marketing expenses and other expenses associated with Hilton's brands and shared services will be directly reimbursed to Hilton by Park pursuant to the terms of the management and franchise agreements. Financial Information During the three months ended March 31, 2017, we recognized $39 million of management and franchise fees for properties that were transferred to Park upon completion of the spin-offs and $20 million of license fees from HGV. Prior to the spin-offs, the results of Park were reported in our ownership segment and the results of HGV were reported in our timeshare segment. Following the spin-offs, we do not have a timeshare segment, as we no longer have timeshare operations. The following table presents the assets and liabilities of Park and HGV that were included in discontinued operations in our condensed consolidated balance sheet as of December 31, 2016: (in millions) ASSETS Current Assets: Cash and cash equivalents $ 341 Restricted cash and cash equivalents 160 Accounts receivable, net of allowance for doubtful accounts 250 Prepaid expenses 48 Inventories 527 Current portion of financing receivables, net 136 Other 16 Total current assets of discontinued operations (variable interest entities - $92) 1,478 Intangibles and Other Assets: Goodwill 604 Management and franchise contracts, net 56 Other intangible assets, net 60 Property and equipment, net 8,589 Deferred income tax assets 35 Financing receivables, net 895 Investments in affiliates 81 Other 27 Total non-current assets of discontinued operations (variable interest entities - $405) 10,347 TOTAL ASSETS OF DISCONTINUED OPERATIONS $ 11,825 LIABILITIES Current Liabilities: Accounts payable, accrued expenses and other $ 632 Current maturities of long-term debt 65 Current maturities of timeshare debt 73 Income taxes payable 4 Total current liabilities of discontinued operations (variable interest entities - $81) 774 Long-term debt 3,437 Timeshare debt 621 Deferred revenues 22 Deferred income tax liabilities 2,797 Other 17 TOTAL LIABILITIES OF DISCONTINUED OPERATIONS (variable interest entities - $506) $ 7,668 The following table presents the results of operations of Park and HGV that were included in discontinued operations in our condensed consolidated statement of operations for the three months ended March 31, 2016 : (in millions) Revenues Franchise fees $ 10 Base and other management fees 7 Owned and leased hotels 648 Timeshare 326 Other revenues 3 Other revenues from managed and franchised properties 30 Total revenues from discontinued operations 1,024 Expenses Owned and leased hotels 449 Timeshare 217 Depreciation and amortization 77 General and administrative 10 Other expenses 2 Other expenses from managed and franchised properties 30 Total expenses from discontinued operations 785 Operating income from discontinued operations 239 Interest expense (49 ) Other non-operating income, net 4 Income from discontinued operations before income taxes 194 Income tax expense (75 ) Income from discontinued operations, net of taxes 119 Income from discontinued operations attributable to noncontrolling interests, net of taxes (2 ) Income from discontinued operations attributable to Hilton stockholders, net of taxes $ 117 The following table presents selected financial information of Park and HGV that was included in our condensed consolidated statement of cash flows for the three months ended March 31, 2016 : (in millions) Non-cash items included in net income: Depreciation and amortization $ 77 Investing activities: Capital expenditures for property and equipment $ 68 |
Consolidated Variable Interest
Consolidated Variable Interest Entities | 3 Months Ended |
Mar. 31, 2017 | |
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract] | |
Consolidated Variable Interest Entities | Consolidated Variable Interest Entities As of March 31, 2017 and December 31, 2016 , we consolidated three variable interest entities ("VIEs"): two entities that lease hotel properties and one management company. We are the primary beneficiaries of these consolidated VIEs as we have the power to direct the activities that most significantly affect their economic performance. Additionally, we have the obligation to absorb their losses and the right to receive benefits that could be significant to them. The assets of our VIEs are only available to settle the obligations of the respective entities. Our condensed consolidated balance sheets included the assets and liabilities of these entities, which primarily comprised the following: March 31, December 31, 2017 2016 (in millions) Cash and cash equivalents $ 55 $ 57 Accounts receivable, net 14 14 Property and equipment, net 55 52 Deferred income tax assets 61 58 Other non-current assets 56 53 Accounts payable, accrued expenses and other 34 33 Long-term debt 222 212 During the three months ended March 31, 2017 and 2016 , we did not provide any financial or other support to any VIEs that we were not previously contractually required to provide, nor do we intend to provide such support in the future. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Notes) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill Our goodwill balances, by reporting unit, were as follows: Ownership (1) Management and Franchise (2) Total (in millions) Balance as of December 31, 2016 $ 184 $ 5,034 $ 5,218 Spin-offs of Park and HGV (91 ) — (91 ) Foreign currency translation 2 6 8 Balance as of March 31, 2017 $ 95 $ 5,040 $ 5,135 ____________ (1) Excludes goodwill of $2,706 million and accumulated impairment losses of $2,102 million that were attributable to Park and included in non-current assets of discontinued operations in the condensed consolidated balance sheet as of December 31, 2016. Total goodwill balances for the ownership reporting unit include the following gross carrying values and accumulated impairment losses for the periods presented: Gross Carrying Value Accumulated Impairment Losses Net Carrying Value (in millions) Balance as of December 31, 2016 $ 856 $ (672 ) $ 184 Spin-offs of Park and HGV (423 ) 332 (91 ) Foreign currency translation 2 — 2 Balance as of March 31, 2017 $ 435 $ (340 ) $ 95 (2) There were no accumulated impairment losses for the management and franchise reporting unit as of March 31, 2017 and December 31, 2016. Intangible Assets Intangible assets were as follows: March 31, 2017 Gross Carrying Value Accumulated Amortization Net Carrying Value (in millions) Amortizing Intangible Assets: Management and franchise contracts: Management and franchise contracts recorded at Merger (1) $ 2,225 $ (1,578 ) $ 647 Contract acquisition costs and other 354 (71 ) 283 $ 2,579 $ (1,649 ) $ 930 Other intangible assets: Leases (1) $ 279 $ (132 ) $ 147 Capitalized software 519 (380 ) 139 Hilton Honors (1) 336 (198 ) 138 Other 38 (31 ) 7 $ 1,172 $ (741 ) $ 431 Non-amortizing Intangible Assets: Brands (1) $ 4,856 $ — $ 4,856 ____________ (1) Represents intangible assets that were initially recorded at their fair value as part of the October 24, 2007 transaction whereby we became a wholly owned subsidiary of an affiliate of Blackstone (the "Merger"). December 31, 2016 Gross Carrying Value Accumulated Amortization Net Carrying Value (in millions) Amortizing Intangible Assets: Management and franchise contracts: Management and franchise contracts recorded at Merger (1) $ 2,221 $ (1,534 ) $ 687 Contract acquisition costs and other 343 (67 ) 276 $ 2,564 $ (1,601 ) $ 963 Other intangible assets: Leases (1) $ 276 $ (126 ) $ 150 Capitalized software 510 (362 ) 148 Hilton Honors (1) 335 (192 ) 143 Other 37 (31 ) 6 $ 1,158 $ (711 ) $ 447 Non-amortizing Intangible Assets: Brands (1) $ 4,848 $ — $ 4,848 ____________ (1) Represents intangible assets that were initially recorded at their fair value as part of the Merger. We recorded amortization expense of $74 million and $78 million for the three months ended March 31, 2017 and 2016 , respectively, including $17 million and $22 million , respectively, of amortization expense on capitalized software. Changes to our brands intangible asset during the three months ended March 31, 2017 were due to foreign currency translations. We estimate our future amortization expense for our amortizing intangible assets as of March 31, 2017 to be as follows: Year (in millions) 2017 (remaining) $ 211 2018 267 2019 248 2020 201 2021 71 Thereafter 363 $ 1,361 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Debt | Debt Long-term Debt Long-term debt balances, including obligations for capital leases, and associated interest rates as of March 31, 2017 , were as follows: March 31, December 31, 2017 2016 (in millions) Senior notes due 2021 $ — $ 1,500 Senior notes with a rate of 4.250%, due 2024 1,000 1,000 Senior notes with a rate of 4.625%, due 2025 900 — Senior notes with a rate of 4.875%, due 2027 600 — Senior secured term loan facility due 2020 — 750 Senior secured term loan facility with a rate of 2.98%, due 2023 3,959 3,209 Capital lease obligations with an average rate of 6.34%, due 2021 to 2030 237 227 Other debt with an average rate of 2.65%, due 2018 to 2026 22 20 6,718 6,706 Less: unamortized deferred financing costs and discount (89 ) (90 ) Less: current maturities of long-term debt (1) (41 ) (33 ) $ 6,588 $ 6,583 ____________ (1) Net of unamortized deferred financing costs and discount attributable to current maturities of long-term debt. Senior Notes In March 2017, we issued $900 million aggregate principal amount of 4.625% Senior Notes due 2025 (the "2025 Senior Notes") and $600 million aggregate principal amount of 4.875% Senior Notes due 2027 (the "2027 Senior Notes"), and incurred $21 million of debt issuance costs. Interest on the 2025 Senior Notes and the 2027 Senior Notes is payable semi-annually in arrears on April 1 and October 1 of each year, beginning in October 2017. The 2025 Senior Notes and the 2027 Senior Notes are guaranteed on a senior unsecured basis by us and certain of our wholly owned subsidiaries. We used the net proceeds of the 2025 Senior Notes and the 2027 Senior Notes, along with available cash, to redeem in full our $1.5 billion 5.625% Senior Notes due 2021 (the "2021 Senior Notes"), plus accrued and unpaid interest. In connection with the repayment, we paid a redemption premium of $42 million and accelerated the recognition of $18 million of unamortized debt issuance costs, which were included in loss on debt extinguishment in our condensed consolidated statement of operations. Senior Secured Credit Facility Our senior secured credit facility consists of a $1.0 billion senior secured revolving credit facility (the "Revolving Credit Facility") and a senior secured term loan facility (the "Term Loans"). In March 2017, we amended the Term Loans pursuant to which $750 million of outstanding Term Loans due in 2020 were extended, aligning their maturity with the $3,209 million tranche of Term Loans due 2023. Additionally, the entire balance of the Term Loans was repriced with an interest rate of LIBOR plus 200 basis points . In connection with the refinancing of the Term Loans, we incurred $3 million of debt issuance costs, which were included in other non-operating income, net, in our condensed consolidated statement of operations. As of March 31, 2017 , we had $23 million of letters of credit outstanding under our Revolving Credit Facility and a borrowing capacity of $977 million . Debt Maturities The contractual maturities of our long-term debt as of March 31, 2017 were as follows: Year (in millions) 2017 (remaining) $ 36 2018 59 2019 55 2020 56 2021 57 Thereafter 6,455 $ 6,718 |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities During the three months ended March 31, 2017 and 2016 , derivatives were used to hedge the interest rate risk associated with variable-rate debt, as well as foreign exchange risk associated with certain foreign currency denominated cash balances. Cash Flow Hedges During the three months ended March 31, 2017 , we entered into two interest rate swap agreements with notional amounts of $1.6 billion and $750 million , which swap one-month LIBOR on the Term Loans to fixed rates of 1.98 percent and 2.02 percent, respectively, and expire in March 2022. We elected to designate these interest rate swaps as cash flow hedges for accounting purposes. Non-designated Hedges During the year ended December 31, 2016 , we dedesignated four interest rate swaps (the "2013 Interest Rate Swaps") that were previously designated as cash flow hedges as they no longer met the criteria for hedge accounting. These interest rate swaps, which had an aggregate notional amount of $1.45 billion and swapped three-month LIBOR on the Term Loans to a fixed rate of 1.87 percent, were settled during the three months ended March 31, 2017 . As of March 31, 2017 , we held 63 short-term foreign exchange forward contracts with an aggregate notional amount of $255 million to offset exposure to fluctuations in our foreign currency denominated cash balances. We elected not to designate these foreign exchange forwar d contracts as hedging instruments. Fair Value of Derivative Instruments The fair values of our derivative instruments in our condensed consolidated balance sheets were as follows: March 31, December 31, Balance Sheet Classification 2017 2016 (in millions) Cash Flow Hedges: Interest rate swaps Other liabilities $ 7 N/A Non-designated Hedges: Interest rate swaps Other liabilities — $ 12 Forward contracts Other current assets 1 3 Forward contracts Accounts payable, accrued expenses and other 1 4 Earnings Effect of Derivative Instruments The gains and losses recognized in our condensed consolidated statements of operations and condensed consolidated statements of comprehensive income before any effect for income taxes were as follows: Three Months Ended March 31, Classification of Gain (Loss) Recognized 2017 2016 (in millions) Cash Flow Hedges: Interest rate swaps (1) Other comprehensive income $ (7 ) $ (10 ) Non-designated Hedges: Interest rate swaps Other non-operating income, net 2 N/A Interest rate swaps (2) Interest expense 3 N/A Forward contracts Loss on foreign currency transactions 1 1 ____________ (1) There were no amounts recognized in earnings related to hedge ineffectiveness or amounts excluded from hedge effectiveness testing during the three months ended March 31, 2017 and 2016 . (2) This amount is related to the dedesignation of the 2013 Interest Rate Swaps as cash flow hedges and was reclassified from accumulated other comprehensive loss as the underlying transactions occurred. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We did not elect the fair value measurement option for any of our financial assets or liabilities. The fair value of certain financial instruments and the hierarchy level we used to estimate fair values are shown below: March 31, 2017 Hierarchy Level Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Cash equivalents $ 580 $ — $ 580 $ — Restricted cash equivalents 12 — 12 — Liabilities: Long-term debt (1) 6,370 2,512 — 3,996 Interest rate swaps 7 — 7 — December 31, 2016 Hierarchy Level Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Cash equivalents $ 782 $ — $ 782 $ — Restricted cash equivalents 11 — 11 — Liabilities: Long-term debt (1) 6,369 2,516 — 4,006 Interest rate swaps 12 — 12 — ____________ (1) Carrying value includes unamortized deferred financing costs and discount. The carrying values and fair values exclude capital lease obligations and other debt. The fair values of financial instruments not included in this table are estimated to be equal to their carrying values as of March 31, 2017 and December 31, 2016 . Our estimates of the fair values were determined using available market information and appropriate valuation methods. Considerable judgment is necessary to interpret market data and develop the estimated fair values. Cash equivalents and restricted cash equivalents primarily consisted of short-term interest-bearing money market funds with maturities of less than 90 days and time deposits. The estimated fair values were based on available market pricing information of similar financial instruments. The estimated fair values of our Level 1 long-term debt were based on prices in active debt markets. The estimated fair values of our Level 3 long-term debt were based on indicative quotes received for similar issuances. We measure our interest rate swaps at fair value, which were estimated using an income approach. The primary inputs into our fair value estimate include interest rates and yield curves based on observable market inputs of similar instruments. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes At the end of each quarter we estimate the effective income tax rate expected to be applied for the full year. The effective income tax rate is determined by the level and composition of pre-tax income or loss, which is subject to federal, foreign, state and local income taxes. Our total unrecognized tax benefits as of March 31, 2017 were $174 million . We accrued approximately $33 million for the payment of interest and penalties as of March 31, 2017 . As a result of the expected resolution of examination issues with federal, state and foreign tax authorities, we believe it is reasonably possible that during the next 12 months the amount of unrecognized tax benefits will decrease up to $8 million . Included in the balance of unrecognized tax benefits as of March 31, 2017 was $173 million associated with positions that, if favorably resolved, would provide a benefit to our effective income tax rate. In April 2014, we received 30-day Letters from the IRS and the Revenue Agents Report ("RAR") for the 2006 and October 2007 tax years. We disagreed with several of the proposed adjustments in the RAR, filed a formal appeals protest with the IRS and did not make any tax payments related to this audit. The issues being protested in appeals relate to assertions by the IRS that: (i) certain foreign currency denominated intercompany loans from our foreign subsidiaries to certain U.S. subsidiaries should be recharacterized as equity for U.S. federal income tax purposes and constitute deemed dividends from such foreign subsidiaries to our U.S. subsidiaries; (ii) in calculating the amount of U.S. taxable income resulting from our Hilton Honors guest loyalty program, we should not reduce gross income by the estimated costs of future redemptions, but rather such costs would be deductible at the time the points are redeemed; and (iii) certain foreign currency denominated loans issued by one of our Luxembourg subsidiaries whose functional currency is U.S. dollar ("USD"), should instead be treated as issued by one of our Belgian subsidiaries whose functional currency is the euro, and thus foreign currency gains and losses with respect to such loans should have been measured in euros, instead of USD. Additionally, in January 2016, we received a 30-day Letter from the IRS and the RAR for the December 2007 through 2010 tax years. The RAR includes the proposed adju stments for tax years December 2007 through 2010, which reflect the carryover effect of the three protested issues from 2006 through October 2007. These proposed adjustments will also be protested in appeals and formal appeals protests have been submitted. In total, the proposed adjustments sought by the IRS would result in additional U.S. federal tax owed of approximately $874 million , excluding interest and penalties and potential state income taxes. The portion of this amount related to our Hilton Honors guest loyalty program would result in a decrease to our future tax liability when the points are redeemed. We disagree with the IRS's position on each of these assertions and intend to vigorously contest them. However, based on continuing appeals process discussions with the IRS, we believe that it is more likely than not that we will not recognize the full benefit related to certain of the issues being appealed. Accordingly, we have recorded $46 million of unrecognized tax benefits related to these issues. We file income tax returns, including returns for our subsidiaries, with federal, state and foreign jurisdictions. We are under regular and recurring audit by the IRS and other taxing authorities on open tax positions. The timing of the resolution of tax audits is highly uncertain, as are the amounts, if any, that may ultimately be paid upon such resolution. Changes may result from the conclusion of ongoing audits, appeals or litigation in state, local, federal and foreign tax jurisdictions or from the resolution of various proceedings between the U.S. and foreign tax authorities. We are no longer subject to U.S. federal income tax examination for years through 2004. As of March 31, 2017 , we remain subject to federal examinations from 2005-2015, state examinations from 2003-2015 and foreign examinations of our income tax returns for the years 1996 through 2016. State income tax returns are generally subject to examination for a period of three to five years after filing the respective return; however, the state effect of any federal tax return changes remains subject to examination by various states for a period generally of up to one year after formal notification to the states. The statute of limitations for the foreign jurisdictions generally ranges from three to ten years after filing the respective tax return. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation We issue time-vesting restricted stock units and restricted stock ("RSUs"), nonqualified stock options ("options"), performance-vesting restricted stock units and restricted stock (collectively, "performance shares") and deferred share units ("DSUs"). We recognized share-based compensation expense of $25 million and $16 million during the three months ended March 31, 2017 and 2016 , respectively, which included amounts reimbursed by hotel owners. As of March 31, 2017 , unrecognized compensation costs for unvested awards was approximately $171 million , which is expected to be recognized over a weighted-average period of 2.4 years on a straight-line basis. As of March 31, 2017 , there were 29,922,923 shares of common stock available for future issuance. All share and share-related information have been adjusted to reflect the Reverse Stock Split. See Note 1 : " Organization and Basis of Presentation " for additional information. Effect of the Spin-offs on Equity Awards In connection with the spin-offs, the outstanding share-based compensation awards held by employees transferring to Park and HGV were converted to equity awards in Park and HGV stock, respectively. Share-based compensation awards of employees remaining at Hilton were adjusted using a conversion factor in accordance with the anti-dilution provisions of the 2013 Omnibus Incentive Plan with the intent to preserve the intrinsic value of the original awards (the "Conversion Factor"). The adjustments were determined by comparing the fair value of such awards immediately prior to the spin-offs to the fair value of such awards immediately after and resulted in no incremental compensation expense. Equity awards that were adjusted generally remain subject to the same vesting, expiration and other terms and conditions as applied to the awards immediately prior to the spin-offs. RSUs The following table summarizes the activity of our RSUs during the three months ended March 31, 2017 : Number of Shares Weighted Average Grant Date Fair Value per Share Outstanding as of December 31, 2016 1,624,541 $ 65.24 Conversion from performance shares upon completion of the spin-offs (1) 671,604 72.42 Effect of the spin-offs 439,113 57.60 Granted 1,313,783 58.02 Vested (876,145 ) 47.19 Forfeited (47,971 ) 47.97 Outstanding as of March 31, 2017 (2) 3,124,925 52.01 ____________ (1) Represents all performance shares outstanding as of December 31, 2016. (2) The weighted average grant date fair value was adjusted to reflect the Conversion Factor. The RSUs granted during the three months ended March 31, 2017 generally vest in equal annual installments over two or three years from the date of grant. Options The following table summarizes the activity of our options during the three months ended March 31, 2017 : Number of Options Weighted Average Exercise Price per Share Outstanding as of December 31, 2016 1,076,031 $ 66.83 Effect of the spin-offs 251,145 57.60 Granted 710,967 58.02 Exercised (10,681 ) 45.35 Forfeited, canceled or expired (2,146 ) 57.99 Outstanding as of March 31, 2017 (1) 2,025,316 50.89 Exercisable as of March 31, 2017 (1) 793,005 48.23 ____________ (1) The weighted average exercise price was adjusted to reflect the Conversion Factor. The options granted during 2017 vest over three years from the date of grant and terminate 10 years from the date of grant or earlier if the individual’s service terminates under certain circumstances. The grant date fair value of the options granted during the three months ended March 31, 2017 was $ 13.86 , which was determined using the Black-Scholes-Merton option-pricing model with the following assumptions: Expected volatility (1) 24.00 % Dividend yield (2) 1.03 % Risk-free rate (3) 2.03 % Expected term (in years) (4) 6.0 ____________ (1) Due to limited trading history for our common stock, we did not have sufficient information available on which to base a reasonable and supportable estimate of the expected volatility of our share price. As a result, we used an average historical volatility of our peer group over a time period consistent with our expected term assumption. Our peer group was determined based upon companies in our industry with similar business models and is consistent with those used to benchmark our executive compensation. (2) Estimated based on the expected annualized dividend payment at the date of grant. (3) Based on the yields of U.S. Department of Treasury instruments with similar expected lives. (4) Estimated using the average of the vesting periods and the contractual term of the options. Performance Shares As of December 31, 2016, we had outstanding performance awards based on a measure of the Company’s total shareholder return relative to the total shareholder returns of members of a peer company group ("relative shareholder return") and based on the Company’s earnings before interest expense, income taxes and depreciation and amortization ("EBITDA") compound annual growth rate ("CAGR") ("EBITDA CAGR"). Upon completion of the spin-offs, we converted all 671,604 outstanding performance shares to RSUs based on a 100 percent achievement percentage with the same vesting periods as the original awards, and as of March 31, 2017 , there were no outstanding performance shares based on relative shareholder return. During the three months ended March 31, 2017 , we issued performance shares with 50 percent of the shares subject to achievement based on the Company's free cash flow ("FCF") per share CAGR ("FCF CAGR") and the other 50 percent of the shares subject to achievement based on the Company’s EBITDA CAGR. The performance shares are settled at the end of the three-year performance period. We determined that the performance condition for these awards is probable of achievement and, as of March 31, 2017 , we recognized compensation expense based on the anticipated achievement percentage of 100 percent . The following table summarizes the activity of our performance shares during the three months ended March 31, 2017 : EBITDA CAGR FCF CAGR Number of Shares Weighted Average Grant Date Fair Value per Share Number of Shares Weighted Average Grant Date Fair Value per Share Outstanding as of December 31, 2016 335,802 $ 68.09 — N/A Conversion to RSUs upon completion of the spin-offs (335,802 ) 68.09 — N/A Granted 169,843 58.02 169,812 $ 58.02 Outstanding as of March 31, 2017 169,843 58.02 169,812 58.02 |
Stockholders' Equity and Accumu
Stockholders' Equity and Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity and Accumulated Other Comprehensive Loss | Stockholders' Equity and Accumulated Other Comprehensive Loss The changes in the components of stockholders' equity were as follows: Equity Attributable to Hilton Stockholders Treasury Stock Additional (1) Accumulated Deficit Accumulated Other Comprehensive Loss Common Stock (1) Noncontrolling Interests (2) Shares Amount Total (in millions) Balance as of December 31, 2016 329 $ 3 $ — $ 10,220 $ (3,323 ) $ (1,001 ) $ (50 ) $ 5,849 Share-based compensation 2 — — (7 ) — — — (7 ) Repurchases of common stock (1 ) — (70 ) — — — — (70 ) Net income — — — — 74 — 1 75 Other comprehensive income (loss) — — — — — 20 (1 ) 19 Dividends — — — — (50 ) — — (50 ) Spin-offs of Park and HGV — — — — (4,331 ) 63 49 (4,219 ) Cumulative effect of the adoption of ASU 2016-09 — — — 1 (1 ) — — — Distributions — — — — — — (1 ) (1 ) Balance as of March 31, 2017 330 $ 3 $ (70 ) $ 10,214 $ (7,631 ) $ (918 ) $ (2 ) $ 1,596 Equity Attributable to Hilton Stockholders Additional (1) Accumulated Deficit Accumulated Other Comprehensive Loss Common Stock (1) Noncontrolling Interests (2) Shares Amount Total (in millions) Balance as of December 31, 2015 329 $ 3 $ 10,158 $ (3,392 ) $ (784 ) $ (34 ) $ 5,951 Share-based compensation — — 2 — — — 2 Net income — — — 309 — 1 310 Other comprehensive income (loss) — — — — 10 (2 ) 8 Dividends — — — (69 ) — — (69 ) Cumulative effect of the adoption of ASU 2015-02 — — — — — 5 5 Distributions — — — — — (2 ) (2 ) Balance as of March 31, 2016 329 $ 3 $ 10,160 $ (3,152 ) $ (774 ) $ (32 ) $ 6,205 ____________ (1) Adjusted to reflect the Reverse Stock Split. See Note 1 : " Organization and Basis of Presentation " for additional information. (2) Other comprehensive loss attributable to non-controlling interests was related to a currency translation adjustment. In February 2017, our board of directors authorized a stock repurchase program of up to $1.0 billion of the Company's common stock. During the three months ended March 31, 2017 , we repurchased 1,213,415 shares of common stock under the program at an average cost of $57.67 per share for an aggregate purchase price of $70 million . As of March 31, 2017 , $930 million remained available for share repurchases under the program. The changes in the components of accumulated other comprehensive loss, net of taxes, were as follows: Currency Translation Adjustment (1) Pension Liability Adjustment (2) Cash Flow Hedge Adjustment (3) Total (in millions) Balance as of December 31, 2016 $ (738 ) $ (251 ) $ (12 ) $ (1,001 ) Other comprehensive income (loss) before reclassifications 21 (1 ) (4 ) 16 Amounts reclassified from accumulated other comprehensive loss — 2 2 4 Net current period other comprehensive income (loss) 21 1 (2 ) 20 Spin-offs of Park and HGV 63 — — 63 Balance as of March 31, 2017 $ (654 ) $ (250 ) $ (14 ) $ (918 ) ____________ (1) Includes net investment hedges and intra-entity foreign currency transactions that are of a long-term investment nature. (2) Amounts reclassified include the amortization of prior service cost and net loss that were included in our computation of net periodic pension cost. They were recognized in general and administrative expenses, net of a $ 1 million tax benefit, in our condensed consolidated statement of operations. (3) Amounts reclassified related to the 2013 Interest Rate Swaps and were recognized in interest expense, net of a $ 1 million tax benefit, in our condensed consolidated statement of operations. Currency Translation Adjustment (1) Pension Liability Adjustment (2) Cash Flow Hedge Adjustment Total (in millions) Balance as of December 31, 2015 $ (580 ) $ (194 ) $ (10 ) $ (784 ) Other comprehensive income (loss) before reclassifications 15 — (6 ) 9 Amounts reclassified from accumulated other comprehensive loss — 1 — 1 Net current period other comprehensive income (loss) 15 1 (6 ) 10 Balance as of March 31, 2016 $ (565 ) $ (193 ) $ (16 ) $ (774 ) ____________ (1) Includes net investment hedges and intra-entity foreign currency transactions that are of a long-term investment nature. (2) Amounts reclassified were recognized in general and administrative expenses, net of a $ 1 million tax benefit, in our condensed consolidated statement of operations. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table presents the calculation of basic and diluted earnings per share ("EPS"). All share and per share amounts have been adjusted to reflect the Reverse Stock Split. See Note 1 : " Organization and Basis of Presentation " for additional information. Three Months Ended March 31, 2017 2016 (in millions, except per share amounts) Basic EPS: Numerator: Net income from continuing operations attributable to Hilton stockholders $ 74 $ 192 Denominator: Weighted average shares outstanding 330 329 Basic EPS $ 0.22 $ 0.58 Diluted EPS: Numerator: Net income from continuing operations attributable to Hilton stockholders $ 74 $ 192 Denominator: Weighted average shares outstanding 331 330 Diluted EPS $ 0.22 $ 0.58 Approximately 1 million share-based compensation awards were excluded from the weighted average shares outstanding used in the computation of diluted EPS for the three months ended March 31, 2017 and 2016 because their effect would have been anti-dilutive under the treasury stock method. |
Business Segments
Business Segments | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Business Segments | Business Segments We are a diversified hospitality company with operations organized in two distinct operating segments, following the spin-offs: (i) management and franchise; and (ii) ownership. Each segment is managed separately because of its distinct economic characteristics. The management and franchise segment includes all of the hotels we manage for third-party owners, as well as all franchised hotels operated or managed by someone other than us. As of March 31, 2017 , this segment included 624 managed hotels and 4,236 franchised hotels totaling 4,860 hotels consisting of 781,978 rooms, within this total are the 67 hotels with 35,425 rooms that were previously owned or leased by Hilton or unconsolidated affiliates of Hilton and, upon completion of the spin-offs, were owned or leased by Park or unconsolidated affiliates of Park. This segment also earns fees for managing properties in our ownership segment and, effective upon completion of the spin-offs, a license fee from HGV for the exclusive right to use certain Hilton marks and intellectual property in its timeshare business. As of March 31, 2017 , the ownership segment included 74 properties totaling 22,278 rooms, comprising 65 hotels that we wholly owned or leas ed, one hot el owned by a consolidated non-wholly owned entity, two h otels leased by consolidated VIEs and six hotels owned or leased by unconsolidated affiliates. Prior to the spin-offs, the performance of our operating segments was evaluated primarily on Adjusted EBITDA. Following the spin-offs, the performance of our operating segments is evaluated primarily on operating income, without allocating corporate and other revenues and expenses or indirect general and administrative expenses, as we have simplified our operating segments and certain adjustments included in Adjusted EBITDA on a segment basis are no longer applicable. The following table presents revenues for our reportable segments, reconciled to consolidated amounts: Three Months Ended March 31, 2017 2016 (in millions) Management and franchise (1) $ 436 $ 357 Ownership 300 319 Segment revenues 736 676 Other revenues 37 17 Other revenues from managed and franchised properties 1,395 1,041 Intersegment fees elimination (1) (7 ) (8 ) Total revenues $ 2,161 $ 1,726 ____________ (1) Includes management, royalty and intellectual property fees charged to our ownership segment, which were eliminated in our condensed consolidated financial statements. The following table presents operating income for our reportable segments, reconciled to consolidated income from continuing operations before income taxes: Three Months Ended March 31, 2017 2016 (in millions) Management and franchise (1) $ 436 $ 357 Ownership (1) 21 4 Segment operating income 457 361 Other revenues, less other expenses 14 (1 ) Depreciation and amortization (89 ) (92 ) Impairment loss — (15 ) General and administrative (105 ) (83 ) Operating income 277 170 Interest expense (104 ) (90 ) Loss on foreign currency transactions (4 ) (12 ) Loss on debt extinguishment (60 ) — Other non-operating income, net 1 2 Income from continuing operations before income taxes $ 110 $ 70 ____________ (1) Includes management, royalty and intellectual property fees charged to our ownership segment by our management and franchise segment, which were eliminated in our condensed consolidated financial statements. The following table presents total assets for our reportable segments, reconciled to consolidated assets of continuing operations: March 31, December 31, 2017 2016 (in millions) Management and franchise $ 10,806 $ 10,825 Ownership 945 1,032 Corporate and other 2,536 2,529 $ 14,287 $ 14,386 The following table presents capital expenditures for property and equipment for our reportable segments, reconciled to consolidated capital expenditures of continuing operations: Three Months Ended March 31, 2017 2016 (in millions) Ownership $ 6 $ 13 Corporate and other 3 3 $ 9 $ 16 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure | Commitments and Contingencies As of March 31, 2017 , we had an outstanding guarantee of $5 million , with a remaining term of six years , for debt of a third party. We have one letter of credit for $5 million that has been pledged as collateral for the guarantee. Although we believe it is unlikely that material payments will be required under the guarantee or letter of credit, there can be no assurance that this will be the case. We have also provided performance guarantees to certain owners of hotels that we operate under management contracts. Most of these guarantees allow us to terminate the contract, rather than fund shortfalls, if specified performance levels are not achieved. However, in limited cases, we are obligated to fund performance shortfalls. As of March 31, 2017 , we had seven contracts containing performance guarantees, with expirations ranging from 2019 to 2030 , and possible cash outlays totaling approximately $70 million . Our obligations under these guarantees in future periods are dependent on the operating performance levels of these hotels over the remaining terms of the performance guarantees. We do not have any letters of credit pledged as collateral against these guarantees. As of March 31, 2017 and December 31, 2016 , we recorded approximately $12 million and $11 million , respectively, in accounts payable, accrued expenses and other and approximately $15 million and $17 million , respectively, in other liabilities in our condensed consolidated balance sheets for two outstanding performance guarantees that are related to VIEs for which we are not the primary beneficiary. We have entered into an agreement with an affiliate of the owner of a hotel whereby we have agreed to provide a $60 million junior mezzanine loan to finance the construction of a new hotel that we will manage. The junior mezzanine loan is subordinated to a senior mortgage loan and senior mezzanine loan provided by third parties unaffiliated with us and will be funded on a pro rata basis with these loans as the construction costs are incurred. During each of the three months ended March 31, 2017 and 2016 , we funded $8 million of this commitment, and we currently expect to fund our remaining commitment of $1 million in 2017. We are involved in litigation arising in the normal course of business, some of which includes claims for substantial sums. While the ultimate results of claims and litigation cannot be predicted with certainty, we expect that the ultimate resolution of all pending or threatened claims and litigation as of March 31, 2017 will not have a material effect on our consolidated results of operations, financial position or cash flows. |
Condensed Consolidating Guarant
Condensed Consolidating Guarantor Financial Information | 3 Months Ended |
Mar. 31, 2017 | |
Condensed Consolidating Guarantor Financial Information [Abstract] | |
Condensed Consolidating Guarantor Financial Information | Condensed Consolidating Guarantor Financial Information In October 2013, Hilton Worldwide Finance LLC and Hilton Worldwide Finance Corp. (the "Subsidiary Issuers"), entities that are 100 percent owned by the Parent, issued the 2021 Senior Notes. In September 2016, Hilton Domestic Operating Company Inc., an entity formed in August 2016 that is 100 percent owned by Hilton Worldwide Finance LLC, assumed the 2024 Senior Notes that were issued in August 2016 by escrow issuers and is a guarantor of the 2021 Senior Notes, 2025 Senior Notes and 2027 Senior Notes. In March 2017, the Subsidiary Issuers issued the 2025 Senior Notes and 2027 Senior Notes, and we used the net proceeds and available cash to repay in full the 2021 Senior Notes. The 2024 Senior Notes, 2025 Senior Notes and 2027 Senior Notes are collectively referred to as the Senior Notes. The Senior Notes are guaranteed jointly and severally on a senior unsecured basis by the Parent and certain of the Parent's 100 percent owned domestic restricted subsidiaries that are themselves not issuers of the applicable series of Senior Notes (together, the "Guarantors"). The indentures that govern the Senior Notes provide that any subsidiary of the Company that provides a guarantee of the Senior Secured Credit Facility will guarantee the Senior Notes. As of March 31, 2017 , none of our foreign subsidiaries or U.S. subsidiaries owned by foreign subsidiaries or conducting foreign operations or our non-wholly owned subsidiaries guarantee the Senior Notes (collectively, the "Non-Guarantors"). In connection with the spin-offs, certain entities that were previously guarantors of the 2021 Senior Notes and 2024 Senior Notes were released and no longer guaranteed these senior notes. The condensed consolidating financial information presents the financial information based on the composition of the Guarantors and Non-Guarantors as of March 31, 2017 . The guarantees are full and unconditional, subject to certain customary release provisions. The indentures that govern the Senior Notes provide that any Guarantor may be released from its guarantee so long as: (i) the subsidiary is sold or sells all of its assets; (ii) the subsidiary is released from its guaranty under the Senior Secured Credit Facility; (iii) the subsidiary is declared "unrestricted" for covenant purposes; (iv) the subsidiary is merged with or into the applicable Subsidiary Issuers or another Guarantor or the Guarantor liquidates after transferring all of its assets to the applicable Subsidiary Issuers or another Guarantor; or (v) the requirements for legal defeasance or covenant defeasance or to discharge the indenture have been satisfied, in each case in compliance with applicable provisions of the indentures. The following schedules present the condensed consolidating financial information as of March 31, 2017 and December 31, 2016 , and for the three months ended March 31, 2017 and 2016 , for the Parent, Subsidiary Issuers, Guarantors and Non-Guarantors. Financial information for Hilton Domestic Operating Company Inc. is included in Guarantors. March 31, 2017 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) ASSETS Current Assets: Cash and cash equivalents $ — $ — $ 14 $ 848 $ — $ 862 Restricted cash and cash equivalents — — 97 27 — 124 Accounts receivable, net — — 655 256 — 911 Intercompany receivables — — — 40 (40 ) — Prepaid expenses — — 56 74 (1 ) 129 Other — — 6 37 — 43 Total current assets — — 828 1,282 (41 ) 2,069 Intangibles and Other Assets: Investments in subsidiaries 1,588 6,975 2,466 — (11,029 ) — Goodwill — — 3,824 1,311 — 5,135 Brands — — 4,405 451 — 4,856 Management and franchise contracts, net — — 683 247 — 930 Other intangible assets, net — — 283 148 — 431 Property and equipment, net — — 72 269 — 341 Deferred income tax assets 10 4 — 82 (14 ) 82 Other — 11 266 166 — 443 Total intangibles and other assets 1,598 6,990 11,999 2,674 (11,043 ) 12,218 TOTAL ASSETS $ 1,598 $ 6,990 $ 12,827 $ 3,956 $ (11,084 ) $ 14,287 LIABILITIES AND EQUITY Current Liabilities: Accounts payable, accrued expenses and other $ — $ 6 $ 1,371 $ 422 $ (1 ) $ 1,798 Intercompany payables — — 40 — (40 ) — Current maturities of long-term debt — 32 — 9 — 41 Income taxes payable — — 49 79 — 128 Total current liabilities — 38 1,460 510 (41 ) 1,967 Long-term debt — 5,357 982 249 — 6,588 Deferred revenues — — 22 — — 22 Deferred income tax liabilities — — 1,710 27 (14 ) 1,723 Liability for guest loyalty program — — 898 — — 898 Other — 7 780 706 — 1,493 Total liabilities — 5,402 5,852 1,492 (55 ) 12,691 Equity: Total Hilton stockholders' equity 1,598 1,588 6,975 2,466 (11,029 ) 1,598 Noncontrolling interests — — — (2 ) — (2 ) Total equity 1,598 1,588 6,975 2,464 (11,029 ) 1,596 TOTAL LIABILITIES AND EQUITY $ 1,598 $ 6,990 $ 12,827 $ 3,956 $ (11,084 ) $ 14,287 December 31, 2016 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) ASSETS Current Assets: Cash and cash equivalents $ — $ — $ 25 $ 1,037 $ — $ 1,062 Restricted cash and cash equivalents — — 96 25 — 121 Accounts receivable, net — — 491 264 — 755 Intercompany receivables — — — 42 (42 ) — Prepaid expenses — — 27 65 (3 ) 89 Income taxes receivable — — 30 — (17 ) 13 Other — — 6 33 — 39 Current assets of discontinued operations — — — 1,502 (24 ) 1,478 Total current assets — — 675 2,968 (86 ) 3,557 Intangibles and Other Assets: Investments in subsidiaries 5,889 11,300 6,993 — (24,182 ) — Goodwill — — 3,824 1,394 — 5,218 Brands — — 4,404 444 — 4,848 Management and franchise contracts, net — — 716 247 — 963 Other intangible assets, net — — 297 150 — 447 Property and equipment, net — — 74 267 — 341 Deferred income tax assets 10 2 — 82 (12 ) 82 Other — 12 243 153 — 408 Non-current assets of discontinued operations — — 2 10,345 — 10,347 Total intangibles and other assets 5,899 11,314 16,553 13,082 (24,194 ) 22,654 TOTAL ASSETS $ 5,899 $ 11,314 $ 17,228 $ 16,050 $ (24,280 ) $ 26,211 LIABILITIES AND EQUITY Current Liabilities: Accounts payable, accrued expenses and other $ — $ 26 $ 1,384 $ 414 $ (3 ) $ 1,821 Intercompany payables — — 42 — (42 ) — Current maturities of long-term debt — 26 — 7 — 33 Income taxes payable — — — 73 (17 ) 56 Current liabilities of discontinued operations — — 77 721 (24 ) 774 Total current liabilities — 52 1,503 1,215 (86 ) 2,684 Long-term debt — 5,361 981 241 — 6,583 Deferred revenues — — 42 — — 42 Deferred income tax liabilities — — 1,752 38 (12 ) 1,778 Liability for guest loyalty program — — 889 — — 889 Other — 12 767 713 — 1,492 Non-current liabilities of discontinued operations — — (6 ) 6,900 — 6,894 Total liabilities — 5,425 5,928 9,107 (98 ) 20,362 Equity: Total Hilton stockholders' equity 5,899 5,889 11,300 6,993 (24,182 ) 5,899 Noncontrolling interests — — — (50 ) — (50 ) Total equity 5,899 5,889 11,300 6,943 (24,182 ) 5,849 TOTAL LIABILITIES AND EQUITY $ 5,899 $ 11,314 $ 17,228 $ 16,050 $ (24,280 ) $ 26,211 Three Months Ended March 31, 2017 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Revenues Franchise fees $ — $ — $ 274 $ 24 $ (4 ) $ 294 Base and other management fees — — 50 33 — 83 Incentive management fees — — 22 30 — 52 Owned and leased hotels — — — 300 — 300 Other revenues — — 33 4 — 37 — — 379 391 (4 ) 766 Other revenues from managed and franchised properties — — 1,265 130 — 1,395 Total revenues — — 1,644 521 (4 ) 2,161 Expenses Owned and leased hotels — — — 272 — 272 Depreciation and amortization — — 65 24 — 89 General and administrative — — 81 24 — 105 Other expenses — — 19 8 (4 ) 23 — — 165 328 (4 ) 489 Other expenses from managed and franchised properties — — 1,265 130 — 1,395 Total expenses — — 1,430 458 (4 ) 1,884 Operating income — — 214 63 — 277 Interest expense — (63 ) (28 ) (13 ) — (104 ) Gain (loss) on foreign currency transactions — — 32 (36 ) — (4 ) Loss on debt extinguishment — (60 ) — — — (60 ) Other non-operating income (loss), net — (3 ) 2 2 — 1 Income (loss) from continuing operations before income taxes and equity in earnings from subsidiaries — (126 ) 220 16 — 110 Income tax benefit (expense) — 49 (81 ) (3 ) — (35 ) Income (loss) from continuing operations before equity in earnings from subsidiaries — (77 ) 139 13 — 75 Equity in earnings from subsidiaries 74 151 12 — (237 ) — Net income 74 74 151 13 (237 ) 75 Net income attributable to noncontrolling interests — — — (1 ) — (1 ) Net income attributable to Hilton stockholders $ 74 $ 74 $ 151 $ 12 $ (237 ) $ 74 Comprehensive income $ 94 $ 72 $ 155 $ 30 $ (257 ) $ 94 Comprehensive loss (income) attributable to noncontrolling interests — — — — — — Comprehensive income attributable to Hilton stockholders $ 94 $ 72 $ 155 $ 30 $ (257 ) $ 94 Three Months Ended March 31, 2016 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Revenues Franchise fees $ — $ — $ 234 $ 22 $ (3 ) $ 253 Base and other management fees — — 32 28 — 60 Incentive management fees — — 8 28 — 36 Owned and leased hotels — — — 319 — 319 Other revenues — — 14 3 — 17 — — 288 400 (3 ) 685 Other revenues from managed and franchised properties — — 924 117 — 1,041 Total revenues — — 1,212 517 (3 ) 1,726 Expenses Owned and leased hotels — — — 307 — 307 Depreciation and amortization — — 68 24 — 92 Impairment loss — — — 15 — 15 General and administrative — — 57 26 — 83 Other expenses — — 9 12 (3 ) 18 — — 134 384 (3 ) 515 Other expenses from managed and franchised properties — — 924 117 — 1,041 Total expenses — — 1,058 501 (3 ) 1,556 Operating income — — 154 16 — 170 Interest expense — (67 ) (11 ) (12 ) — (90 ) Gain (loss) on foreign currency transactions — — 5 (17 ) — (12 ) Other non-operating income, net — — 2 — — 2 Income (loss) from continuing operations before income taxes and equity in earnings from subsidiaries — (67 ) 150 (13 ) — 70 Income tax benefit (expense) 192 26 (100 ) 3 — 121 Income (loss) from continuing operations before equity in earnings from subsidiaries 192 (41 ) 50 (10 ) — 191 Equity in earnings (losses) from subsidiaries — 41 (9 ) — (32 ) — Income (losses) from continuing operations, net of taxes 192 — 41 (10 ) (32 ) 191 Income from discontinued operations, net of taxes 117 117 117 106 (338 ) 119 Net income 309 117 158 96 (370 ) 310 Net income attributable to noncontrolling interests — — — (1 ) — (1 ) Net income attributable to Hilton stockholders $ 309 $ 117 $ 158 $ 95 $ (370 ) $ 309 Comprehensive income $ 319 $ 111 $ 149 $ 119 $ (380 ) $ 318 Comprehensive loss attributable to noncontrolling interests — — — 1 — 1 Comprehensive income attributable to Hilton stockholders $ 319 $ 111 $ 149 $ 120 $ (380 ) $ 319 Three Months Ended March 31, 2017 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Operating Activities: Net cash provided by (used in) operating activities $ — $ — $ (46 ) $ 112 $ (3 ) $ 63 Investing Activities: Capital expenditures for property and equipment — — (1 ) (8 ) — (9 ) Contract acquisition costs — — (8 ) (5 ) — (13 ) Capitalized software costs — — (9 ) — — (9 ) Other — (13 ) (6 ) — — (19 ) Net cash used in investing activities — (13 ) (24 ) (13 ) — (50 ) Financing Activities: Borrowings — 1,823 — — — 1,823 Repayment of debt — (1,823 ) — (1 ) — (1,824 ) Debt issuance costs and redemption premium — (66 ) — — — (66 ) Repayment of intercompany borrowings — — (3 ) — 3 — Intercompany transfers 119 79 91 (289 ) — — Dividends paid (49 ) — — — — (49 ) Cash transferred in spin-offs of Park and HGV — — — (501 ) — (501 ) Repurchases of common stock (70 ) — — — — (70 ) Distributions to noncontrolling interests — — — (1 ) — (1 ) Tax withholdings on share-based compensation — — (28 ) — — (28 ) Net cash provided by (used in) financing activities — 13 60 (792 ) 3 (716 ) Effect of exchange rate changes on cash, restricted cash and cash equivalents — — — 5 — 5 Net decrease in cash, restricted cash and cash equivalents — — (10 ) (688 ) — (698 ) Cash, restricted cash and cash equivalents from continuing operations, beginning of period — — 121 1,062 — 1,183 Cash, restricted cash and cash equivalents from discontinued operations, beginning of period — — — 501 — 501 Cash, restricted cash and cash equivalents, beginning of period — — 121 1,563 — 1,684 Cash, restricted cash and cash equivalents, end of period $ — $ — $ 111 $ 875 $ — $ 986 Three Months Ended March 31, 2016 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Operating Activities: Net cash provided by (used in) operating activities $ — $ — $ (279 ) $ 618 $ — $ 339 Investing Activities: Capital expenditures for property and equipment — — — (84 ) — (84 ) Contract acquisition costs — — (8 ) (1 ) — (9 ) Capitalized software costs — — (10 ) (1 ) — (11 ) Other — — (9 ) 3 — (6 ) Net cash used in investing activities — — (27 ) (83 ) — (110 ) Financing Activities: Repayment of debt — — — (32 ) — (32 ) Intercompany transfers 69 — 317 (386 ) — — Dividends paid (69 ) — — — — (69 ) Distributions to noncontrolling interests — — — (2 ) — (2 ) Tax withholdings on share-based compensation — — (13 ) — — (13 ) Net cash provided by (used in) financing activities — — 304 (420 ) — (116 ) Effect of exchange rate changes on cash, restricted cash and cash equivalents — — — 4 — 4 Net increase (decrease) in cash, restricted cash and cash equivalents — — (2 ) 119 — 117 Cash, restricted cash and cash equivalents from continuing operations, beginning of period — — 108 526 — 634 Cash, restricted cash and cash equivalents from discontinued operations, beginning of period — — — 222 — 222 Cash, restricted cash and cash equivalents, beginning of period — — 108 748 — 856 Cash, restricted cash and cash equivalents from continuing operations, end of period — — 106 576 — 682 Cash, restricted cash and cash equivalents from discontinued operations, end of period — — — 291 — 291 Cash, restricted cash and cash equivalents, end of period $ — $ — $ 106 $ 867 $ — $ 973 |
Recently Issued Accounting Pr24
Recently Issued Accounting Pronouncements (Policies) | 3 Months Ended |
Mar. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
ASU 2017-04 Goodwill Impairment | In January 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2017-04 ("ASU 2017-04"), Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment . This ASU simplifies the subsequent measurement of goodwill by removing Step 2 from the goodwill impairment test. We elected, as permitted by the standard, to early adopt ASU 2017-04 on a prospective basis as of January 1, 2017. The adoption did not have a material effect on our condensed consolidated financial statements. |
ASU 2016-09 Stock Compensation | In March 2016, the FASB issued ASU No. 2016-09 ("ASU 2016-09"), Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting. This ASU is intended to simplify several aspects of the accounting for share-based payment transactions, including the accounting for income taxes, forfeitures and statutory withholding requirements, as well as classification in the statement of cash flows. We adopted ASU 2016-09 as of January 1, 2017. One of the provisions of this ASU requires entities to make an accounting policy election with respect to forfeitures of share-based payment awards, and we elected to account for forfeitures as they occur and adopted this provision of ASU 2016-09 using a modified retrospective approach by recording a cumulative-effect adjustment to equity as of January 1, 2017 of approximately $1 million . Additionally, we have applied the provisions of this ASU on a retrospective basis in our condensed consolidated statements of cash flows, which includes presenting: (i) excess tax benefits as an operating activity, which were previously presented as a financing activity; and (ii) cash payments to tax authorities for employee taxes when shares are withheld to meet statutory withholding requirements as a financing activity, which were previously presented as an operating activity. |
ASU 2016-02 Leases | In February 2016, the FASB issued ASU No. 2016-02 ("ASU 2016-02"), Leases (Topic 842) , which supersedes existing guidance on accounting for leases in Leases (Topic 840) and generally requires all leases, including operating leases, to be recognized in the statement of financial position as right-of-use assets and lease liabilities by lessees. The provisions of ASU 2016-02 are to be applied using a modified retrospective approach and are effective for reporting periods beginning after December 15, 2018; early adoption is permitted. We are currently evaluating the effect that this ASU will have on our consolidated financial statements, but we expect this ASU to have a material effect on our consolidated balance sheet. |
ASU 2014-09 and Related ASUs Revenue Recognition | In May 2014, the FASB issued ASU No. 2014-09 ("ASU 2014-09"), Revenue from Contracts with Customers (Topic 606) . This ASU supersedes the revenue recognition requirements in Revenue Recognition (Topic 605) and requires entities to recognize revenue when a customer obtains control of promised goods or services and is recognized in an amount that reflects the consideration the entity expects to receive in exchange for those goods or services. Subsequent to ASU 2014-09, the FASB issued several related ASUs. The provisions of ASU 2014-09 and the related ASUs will be effective beginning January 1, 2018. This ASU permits two transition approaches: retrospective or modified retrospective. We are still evaluating our transition approach and expect to reach a decision in the second quarter of 2017. We anticipate that ASU 2014-09 will have a material effect on our consolidated financial statements. However, we expect revenue recognition related to our accounting for ongoing royalty and management fee revenues, direct reimbursable fees from our management and franchise agreements and hotel guest transactions at our owned and leased hotels to remain substantially unchanged. While we are continuing to assess all other potential effects of the standard, we currently believe the provisions of ASU 2014-09 will affect revenue recognition as follows: (i) application and initiation fees for new hotels entering the system will be recognized over the term of the franchise agreement; (ii) certain contract acquisition costs related to our management and franchise agreements will be recognized over the term of the agreements as a reduction to revenue; and (iii) incentive management fees will be recognized to the extent that it is probable that a significant reversal will not occur as a result of future hotel profits or cash flows. We do not expect the changes in revenue recognition for certain contract acquisition costs or incentive management fees to affect the Company’s net income for any full year period. We are currently assessing the effect of the standard on indirect reimbursable fees related to our management and franchise agreements and the accounting for our guest loyalty program. We continue to update our assessment of the effect that ASU 2014-09 and related ASUs will have on our consolidated financial statements, and we will disclose further material effects, if any, when known. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Discontinued Operations | The following table presents the results of operations of Park and HGV that were included in discontinued operations in our condensed consolidated statement of operations for the three months ended March 31, 2016 : (in millions) Revenues Franchise fees $ 10 Base and other management fees 7 Owned and leased hotels 648 Timeshare 326 Other revenues 3 Other revenues from managed and franchised properties 30 Total revenues from discontinued operations 1,024 Expenses Owned and leased hotels 449 Timeshare 217 Depreciation and amortization 77 General and administrative 10 Other expenses 2 Other expenses from managed and franchised properties 30 Total expenses from discontinued operations 785 Operating income from discontinued operations 239 Interest expense (49 ) Other non-operating income, net 4 Income from discontinued operations before income taxes 194 Income tax expense (75 ) Income from discontinued operations, net of taxes 119 Income from discontinued operations attributable to noncontrolling interests, net of taxes (2 ) Income from discontinued operations attributable to Hilton stockholders, net of taxes $ 117 The following table presents selected financial information of Park and HGV that was included in our condensed consolidated statement of cash flows for the three months ended March 31, 2016 : (in millions) Non-cash items included in net income: Depreciation and amortization $ 77 Investing activities: Capital expenditures for property and equipment $ 68 | The following table presents the assets and liabilities of Park and HGV that were included in discontinued operations in our condensed consolidated balance sheet as of December 31, 2016: (in millions) ASSETS Current Assets: Cash and cash equivalents $ 341 Restricted cash and cash equivalents 160 Accounts receivable, net of allowance for doubtful accounts 250 Prepaid expenses 48 Inventories 527 Current portion of financing receivables, net 136 Other 16 Total current assets of discontinued operations (variable interest entities - $92) 1,478 Intangibles and Other Assets: Goodwill 604 Management and franchise contracts, net 56 Other intangible assets, net 60 Property and equipment, net 8,589 Deferred income tax assets 35 Financing receivables, net 895 Investments in affiliates 81 Other 27 Total non-current assets of discontinued operations (variable interest entities - $405) 10,347 TOTAL ASSETS OF DISCONTINUED OPERATIONS $ 11,825 LIABILITIES Current Liabilities: Accounts payable, accrued expenses and other $ 632 Current maturities of long-term debt 65 Current maturities of timeshare debt 73 Income taxes payable 4 Total current liabilities of discontinued operations (variable interest entities - $81) 774 Long-term debt 3,437 Timeshare debt 621 Deferred revenues 22 Deferred income tax liabilities 2,797 Other 17 TOTAL LIABILITIES OF DISCONTINUED OPERATIONS (variable interest entities - $506) $ 7,668 |
Consolidated Variable Interes26
Consolidated Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Variable Interest Entity, Primary Beneficiary, Does Not Hold Majority Voting Interest, Disclosures [Abstract] | |
Schedule of Variable Interest Entities | Our condensed consolidated balance sheets included the assets and liabilities of these entities, which primarily comprised the following: March 31, December 31, 2017 2016 (in millions) Cash and cash equivalents $ 55 $ 57 Accounts receivable, net 14 14 Property and equipment, net 55 52 Deferred income tax assets 61 58 Other non-current assets 56 53 Accounts payable, accrued expenses and other 34 33 Long-term debt 222 212 |
Goodwill and Intangible Asset27
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | Our goodwill balances, by reporting unit, were as follows: Ownership (1) Management and Franchise (2) Total (in millions) Balance as of December 31, 2016 $ 184 $ 5,034 $ 5,218 Spin-offs of Park and HGV (91 ) — (91 ) Foreign currency translation 2 6 8 Balance as of March 31, 2017 $ 95 $ 5,040 $ 5,135 ____________ (1) Excludes goodwill of $2,706 million and accumulated impairment losses of $2,102 million that were attributable to Park and included in non-current assets of discontinued operations in the condensed consolidated balance sheet as of December 31, 2016. Total goodwill balances for the ownership reporting unit include the following gross carrying values and accumulated impairment losses for the periods presented: Gross Carrying Value Accumulated Impairment Losses Net Carrying Value (in millions) Balance as of December 31, 2016 $ 856 $ (672 ) $ 184 Spin-offs of Park and HGV (423 ) 332 (91 ) Foreign currency translation 2 — 2 Balance as of March 31, 2017 $ 435 $ (340 ) $ 95 (2) There were no accumulated impairment losses for the management and franchise reporting unit as of March 31, 2017 and December 31, 2016. |
Schedule of Other Intangible Assets | Intangible assets were as follows: March 31, 2017 Gross Carrying Value Accumulated Amortization Net Carrying Value (in millions) Amortizing Intangible Assets: Management and franchise contracts: Management and franchise contracts recorded at Merger (1) $ 2,225 $ (1,578 ) $ 647 Contract acquisition costs and other 354 (71 ) 283 $ 2,579 $ (1,649 ) $ 930 Other intangible assets: Leases (1) $ 279 $ (132 ) $ 147 Capitalized software 519 (380 ) 139 Hilton Honors (1) 336 (198 ) 138 Other 38 (31 ) 7 $ 1,172 $ (741 ) $ 431 Non-amortizing Intangible Assets: Brands (1) $ 4,856 $ — $ 4,856 ____________ (1) Represents intangible assets that were initially recorded at their fair value as part of the October 24, 2007 transaction whereby we became a wholly owned subsidiary of an affiliate of Blackstone (the "Merger"). December 31, 2016 Gross Carrying Value Accumulated Amortization Net Carrying Value (in millions) Amortizing Intangible Assets: Management and franchise contracts: Management and franchise contracts recorded at Merger (1) $ 2,221 $ (1,534 ) $ 687 Contract acquisition costs and other 343 (67 ) 276 $ 2,564 $ (1,601 ) $ 963 Other intangible assets: Leases (1) $ 276 $ (126 ) $ 150 Capitalized software 510 (362 ) 148 Hilton Honors (1) 335 (192 ) 143 Other 37 (31 ) 6 $ 1,158 $ (711 ) $ 447 Non-amortizing Intangible Assets: Brands (1) $ 4,848 $ — $ 4,848 ____________ (1) Represents intangible assets that were initially recorded at their fair value as part of the Merger. |
Schedule of Future Amortization Expense of Intangible Assets | We estimate our future amortization expense for our amortizing intangible assets as of March 31, 2017 to be as follows: Year (in millions) 2017 (remaining) $ 211 2018 267 2019 248 2020 201 2021 71 Thereafter 363 $ 1,361 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-term debt balances, including obligations for capital leases, and associated interest rates as of March 31, 2017 , were as follows: March 31, December 31, 2017 2016 (in millions) Senior notes due 2021 $ — $ 1,500 Senior notes with a rate of 4.250%, due 2024 1,000 1,000 Senior notes with a rate of 4.625%, due 2025 900 — Senior notes with a rate of 4.875%, due 2027 600 — Senior secured term loan facility due 2020 — 750 Senior secured term loan facility with a rate of 2.98%, due 2023 3,959 3,209 Capital lease obligations with an average rate of 6.34%, due 2021 to 2030 237 227 Other debt with an average rate of 2.65%, due 2018 to 2026 22 20 6,718 6,706 Less: unamortized deferred financing costs and discount (89 ) (90 ) Less: current maturities of long-term debt (1) (41 ) (33 ) $ 6,588 $ 6,583 ____________ (1) Net of unamortized deferred financing costs and discount attributable to current maturities of long-term debt. |
Debt Maturities | The contractual maturities of our long-term debt as of March 31, 2017 were as follows: Year (in millions) 2017 (remaining) $ 36 2018 59 2019 55 2020 56 2021 57 Thereafter 6,455 $ 6,718 |
Derivative Instruments and He29
Derivative Instruments and Hedging Activities (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair Value of Derivative Instruments | The fair values of our derivative instruments in our condensed consolidated balance sheets were as follows: March 31, December 31, Balance Sheet Classification 2017 2016 (in millions) Cash Flow Hedges: Interest rate swaps Other liabilities $ 7 N/A Non-designated Hedges: Interest rate swaps Other liabilities — $ 12 Forward contracts Other current assets 1 3 Forward contracts Accounts payable, accrued expenses and other 1 4 |
Earnings Effect of Derivative Instruments | The gains and losses recognized in our condensed consolidated statements of operations and condensed consolidated statements of comprehensive income before any effect for income taxes were as follows: Three Months Ended March 31, Classification of Gain (Loss) Recognized 2017 2016 (in millions) Cash Flow Hedges: Interest rate swaps (1) Other comprehensive income $ (7 ) $ (10 ) Non-designated Hedges: Interest rate swaps Other non-operating income, net 2 N/A Interest rate swaps (2) Interest expense 3 N/A Forward contracts Loss on foreign currency transactions 1 1 ____________ (1) There were no amounts recognized in earnings related to hedge ineffectiveness or amounts excluded from hedge effectiveness testing during the three months ended March 31, 2017 and 2016 . (2) This amount is related to the dedesignation of the 2013 Interest Rate Swaps as cash flow hedges and was reclassified from accumulated other comprehensive loss as the underlying transactions occurred. |
Fair Value Measurements Fair Va
Fair Value Measurements Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Assets and Liabilities | The fair value of certain financial instruments and the hierarchy level we used to estimate fair values are shown below: March 31, 2017 Hierarchy Level Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Cash equivalents $ 580 $ — $ 580 $ — Restricted cash equivalents 12 — 12 — Liabilities: Long-term debt (1) 6,370 2,512 — 3,996 Interest rate swaps 7 — 7 — December 31, 2016 Hierarchy Level Carrying Value Level 1 Level 2 Level 3 (in millions) Assets: Cash equivalents $ 782 $ — $ 782 $ — Restricted cash equivalents 11 — 11 — Liabilities: Long-term debt (1) 6,369 2,516 — 4,006 Interest rate swaps 12 — 12 — ____________ (1) Carrying value includes unamortized deferred financing costs and discount. The carrying values and fair values exclude capital lease obligations and other debt. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Restricted Stock Units Activity | The following table summarizes the activity of our RSUs during the three months ended March 31, 2017 : Number of Shares Weighted Average Grant Date Fair Value per Share Outstanding as of December 31, 2016 1,624,541 $ 65.24 Conversion from performance shares upon completion of the spin-offs (1) 671,604 72.42 Effect of the spin-offs 439,113 57.60 Granted 1,313,783 58.02 Vested (876,145 ) 47.19 Forfeited (47,971 ) 47.97 Outstanding as of March 31, 2017 (2) 3,124,925 52.01 ____________ (1) Represents all performance shares outstanding as of December 31, 2016. (2) The weighted average grant date fair value was adjusted to reflect the Conversion Factor. |
Schedule of Stock Options Activity | The following table summarizes the activity of our options during the three months ended March 31, 2017 : Number of Options Weighted Average Exercise Price per Share Outstanding as of December 31, 2016 1,076,031 $ 66.83 Effect of the spin-offs 251,145 57.60 Granted 710,967 58.02 Exercised (10,681 ) 45.35 Forfeited, canceled or expired (2,146 ) 57.99 Outstanding as of March 31, 2017 (1) 2,025,316 50.89 Exercisable as of March 31, 2017 (1) 793,005 48.23 ____________ (1) The weighted average exercise price was adjusted to reflect the Conversion Factor. |
Schedule of Stock Options Valuation Assumptions | The grant date fair value of the options granted during the three months ended March 31, 2017 was $ 13.86 , which was determined using the Black-Scholes-Merton option-pricing model with the following assumptions: Expected volatility (1) 24.00 % Dividend yield (2) 1.03 % Risk-free rate (3) 2.03 % Expected term (in years) (4) 6.0 ____________ (1) Due to limited trading history for our common stock, we did not have sufficient information available on which to base a reasonable and supportable estimate of the expected volatility of our share price. As a result, we used an average historical volatility of our peer group over a time period consistent with our expected term assumption. Our peer group was determined based upon companies in our industry with similar business models and is consistent with those used to benchmark our executive compensation. (2) Estimated based on the expected annualized dividend payment at the date of grant. (3) Based on the yields of U.S. Department of Treasury instruments with similar expected lives. (4) Estimated using the average of the vesting periods and the contractual term of the options. |
Schedule of Performance Shares Activity | The following table summarizes the activity of our performance shares during the three months ended March 31, 2017 : EBITDA CAGR FCF CAGR Number of Shares Weighted Average Grant Date Fair Value per Share Number of Shares Weighted Average Grant Date Fair Value per Share Outstanding as of December 31, 2016 335,802 $ 68.09 — N/A Conversion to RSUs upon completion of the spin-offs (335,802 ) 68.09 — N/A Granted 169,843 58.02 169,812 $ 58.02 Outstanding as of March 31, 2017 169,843 58.02 169,812 58.02 |
Stockholders' Equity and Accu32
Stockholders' Equity and Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Stockholders' Equity | The changes in the components of stockholders' equity were as follows: Equity Attributable to Hilton Stockholders Treasury Stock Additional (1) Accumulated Deficit Accumulated Other Comprehensive Loss Common Stock (1) Noncontrolling Interests (2) Shares Amount Total (in millions) Balance as of December 31, 2016 329 $ 3 $ — $ 10,220 $ (3,323 ) $ (1,001 ) $ (50 ) $ 5,849 Share-based compensation 2 — — (7 ) — — — (7 ) Repurchases of common stock (1 ) — (70 ) — — — — (70 ) Net income — — — — 74 — 1 75 Other comprehensive income (loss) — — — — — 20 (1 ) 19 Dividends — — — — (50 ) — — (50 ) Spin-offs of Park and HGV — — — — (4,331 ) 63 49 (4,219 ) Cumulative effect of the adoption of ASU 2016-09 — — — 1 (1 ) — — — Distributions — — — — — — (1 ) (1 ) Balance as of March 31, 2017 330 $ 3 $ (70 ) $ 10,214 $ (7,631 ) $ (918 ) $ (2 ) $ 1,596 Equity Attributable to Hilton Stockholders Additional (1) Accumulated Deficit Accumulated Other Comprehensive Loss Common Stock (1) Noncontrolling Interests (2) Shares Amount Total (in millions) Balance as of December 31, 2015 329 $ 3 $ 10,158 $ (3,392 ) $ (784 ) $ (34 ) $ 5,951 Share-based compensation — — 2 — — — 2 Net income — — — 309 — 1 310 Other comprehensive income (loss) — — — — 10 (2 ) 8 Dividends — — — (69 ) — — (69 ) Cumulative effect of the adoption of ASU 2015-02 — — — — — 5 5 Distributions — — — — — (2 ) (2 ) Balance as of March 31, 2016 329 $ 3 $ 10,160 $ (3,152 ) $ (774 ) $ (32 ) $ 6,205 ____________ (1) Adjusted to reflect the Reverse Stock Split. See Note 1 : " Organization and Basis of Presentation " for additional information. (2) Other comprehensive loss attributable to non-controlling interests was related to a currency translation adjustment. |
Schedule of Accumulated Other Comprehensive Loss | The changes in the components of accumulated other comprehensive loss, net of taxes, were as follows: Currency Translation Adjustment (1) Pension Liability Adjustment (2) Cash Flow Hedge Adjustment (3) Total (in millions) Balance as of December 31, 2016 $ (738 ) $ (251 ) $ (12 ) $ (1,001 ) Other comprehensive income (loss) before reclassifications 21 (1 ) (4 ) 16 Amounts reclassified from accumulated other comprehensive loss — 2 2 4 Net current period other comprehensive income (loss) 21 1 (2 ) 20 Spin-offs of Park and HGV 63 — — 63 Balance as of March 31, 2017 $ (654 ) $ (250 ) $ (14 ) $ (918 ) ____________ (1) Includes net investment hedges and intra-entity foreign currency transactions that are of a long-term investment nature. (2) Amounts reclassified include the amortization of prior service cost and net loss that were included in our computation of net periodic pension cost. They were recognized in general and administrative expenses, net of a $ 1 million tax benefit, in our condensed consolidated statement of operations. (3) Amounts reclassified related to the 2013 Interest Rate Swaps and were recognized in interest expense, net of a $ 1 million tax benefit, in our condensed consolidated statement of operations. Currency Translation Adjustment (1) Pension Liability Adjustment (2) Cash Flow Hedge Adjustment Total (in millions) Balance as of December 31, 2015 $ (580 ) $ (194 ) $ (10 ) $ (784 ) Other comprehensive income (loss) before reclassifications 15 — (6 ) 9 Amounts reclassified from accumulated other comprehensive loss — 1 — 1 Net current period other comprehensive income (loss) 15 1 (6 ) 10 Balance as of March 31, 2016 $ (565 ) $ (193 ) $ (16 ) $ (774 ) ____________ (1) Includes net investment hedges and intra-entity foreign currency transactions that are of a long-term investment nature. (2) Amounts reclassified were recognized in general and administrative expenses, net of a $ 1 million tax benefit, in our condensed consolidated statement of operations. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Basic and Diluted Earnings Per Share | The following table presents the calculation of basic and diluted earnings per share ("EPS"). All share and per share amounts have been adjusted to reflect the Reverse Stock Split. See Note 1 : " Organization and Basis of Presentation " for additional information. Three Months Ended March 31, 2017 2016 (in millions, except per share amounts) Basic EPS: Numerator: Net income from continuing operations attributable to Hilton stockholders $ 74 $ 192 Denominator: Weighted average shares outstanding 330 329 Basic EPS $ 0.22 $ 0.58 Diluted EPS: Numerator: Net income from continuing operations attributable to Hilton stockholders $ 74 $ 192 Denominator: Weighted average shares outstanding 331 330 Diluted EPS $ 0.22 $ 0.58 |
Business Segments (Tables)
Business Segments (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Reconciliation of Revenue from Segment Amounts to Consolidated Amounts | The following table presents revenues for our reportable segments, reconciled to consolidated amounts: Three Months Ended March 31, 2017 2016 (in millions) Management and franchise (1) $ 436 $ 357 Ownership 300 319 Segment revenues 736 676 Other revenues 37 17 Other revenues from managed and franchised properties 1,395 1,041 Intersegment fees elimination (1) (7 ) (8 ) Total revenues $ 2,161 $ 1,726 ____________ (1) Includes management, royalty and intellectual property fees charged to our ownership segment, which were eliminated in our condensed consolidated financial statements. |
Reconciliation of Segment Operating Income to Income from Continuing Operations Before Income Taxes | The following table presents operating income for our reportable segments, reconciled to consolidated income from continuing operations before income taxes: Three Months Ended March 31, 2017 2016 (in millions) Management and franchise (1) $ 436 $ 357 Ownership (1) 21 4 Segment operating income 457 361 Other revenues, less other expenses 14 (1 ) Depreciation and amortization (89 ) (92 ) Impairment loss — (15 ) General and administrative (105 ) (83 ) Operating income 277 170 Interest expense (104 ) (90 ) Loss on foreign currency transactions (4 ) (12 ) Loss on debt extinguishment (60 ) — Other non-operating income, net 1 2 Income from continuing operations before income taxes $ 110 $ 70 ____________ (1) Includes management, royalty and intellectual property fees charged to our ownership segment by our management and franchise segment, which were eliminated in our condensed consolidated financial statements. |
Schedule of Assets by Segment | The following table presents total assets for our reportable segments, reconciled to consolidated assets of continuing operations: March 31, December 31, 2017 2016 (in millions) Management and franchise $ 10,806 $ 10,825 Ownership 945 1,032 Corporate and other 2,536 2,529 $ 14,287 $ 14,386 |
Schedule of Capital Expenditures by Segment | The following table presents capital expenditures for property and equipment for our reportable segments, reconciled to consolidated capital expenditures of continuing operations: Three Months Ended March 31, 2017 2016 (in millions) Ownership $ 6 $ 13 Corporate and other 3 3 $ 9 $ 16 |
Condensed Consolidating Guara35
Condensed Consolidating Guarantor Financial Information (Tables) | 3 Months Ended |
Mar. 31, 2017 | |
Condensed Consolidating Guarantor Financial Information [Abstract] | |
Condensed Balance Sheet | March 31, 2017 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) ASSETS Current Assets: Cash and cash equivalents $ — $ — $ 14 $ 848 $ — $ 862 Restricted cash and cash equivalents — — 97 27 — 124 Accounts receivable, net — — 655 256 — 911 Intercompany receivables — — — 40 (40 ) — Prepaid expenses — — 56 74 (1 ) 129 Other — — 6 37 — 43 Total current assets — — 828 1,282 (41 ) 2,069 Intangibles and Other Assets: Investments in subsidiaries 1,588 6,975 2,466 — (11,029 ) — Goodwill — — 3,824 1,311 — 5,135 Brands — — 4,405 451 — 4,856 Management and franchise contracts, net — — 683 247 — 930 Other intangible assets, net — — 283 148 — 431 Property and equipment, net — — 72 269 — 341 Deferred income tax assets 10 4 — 82 (14 ) 82 Other — 11 266 166 — 443 Total intangibles and other assets 1,598 6,990 11,999 2,674 (11,043 ) 12,218 TOTAL ASSETS $ 1,598 $ 6,990 $ 12,827 $ 3,956 $ (11,084 ) $ 14,287 LIABILITIES AND EQUITY Current Liabilities: Accounts payable, accrued expenses and other $ — $ 6 $ 1,371 $ 422 $ (1 ) $ 1,798 Intercompany payables — — 40 — (40 ) — Current maturities of long-term debt — 32 — 9 — 41 Income taxes payable — — 49 79 — 128 Total current liabilities — 38 1,460 510 (41 ) 1,967 Long-term debt — 5,357 982 249 — 6,588 Deferred revenues — — 22 — — 22 Deferred income tax liabilities — — 1,710 27 (14 ) 1,723 Liability for guest loyalty program — — 898 — — 898 Other — 7 780 706 — 1,493 Total liabilities — 5,402 5,852 1,492 (55 ) 12,691 Equity: Total Hilton stockholders' equity 1,598 1,588 6,975 2,466 (11,029 ) 1,598 Noncontrolling interests — — — (2 ) — (2 ) Total equity 1,598 1,588 6,975 2,464 (11,029 ) 1,596 TOTAL LIABILITIES AND EQUITY $ 1,598 $ 6,990 $ 12,827 $ 3,956 $ (11,084 ) $ 14,287 December 31, 2016 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) ASSETS Current Assets: Cash and cash equivalents $ — $ — $ 25 $ 1,037 $ — $ 1,062 Restricted cash and cash equivalents — — 96 25 — 121 Accounts receivable, net — — 491 264 — 755 Intercompany receivables — — — 42 (42 ) — Prepaid expenses — — 27 65 (3 ) 89 Income taxes receivable — — 30 — (17 ) 13 Other — — 6 33 — 39 Current assets of discontinued operations — — — 1,502 (24 ) 1,478 Total current assets — — 675 2,968 (86 ) 3,557 Intangibles and Other Assets: Investments in subsidiaries 5,889 11,300 6,993 — (24,182 ) — Goodwill — — 3,824 1,394 — 5,218 Brands — — 4,404 444 — 4,848 Management and franchise contracts, net — — 716 247 — 963 Other intangible assets, net — — 297 150 — 447 Property and equipment, net — — 74 267 — 341 Deferred income tax assets 10 2 — 82 (12 ) 82 Other — 12 243 153 — 408 Non-current assets of discontinued operations — — 2 10,345 — 10,347 Total intangibles and other assets 5,899 11,314 16,553 13,082 (24,194 ) 22,654 TOTAL ASSETS $ 5,899 $ 11,314 $ 17,228 $ 16,050 $ (24,280 ) $ 26,211 LIABILITIES AND EQUITY Current Liabilities: Accounts payable, accrued expenses and other $ — $ 26 $ 1,384 $ 414 $ (3 ) $ 1,821 Intercompany payables — — 42 — (42 ) — Current maturities of long-term debt — 26 — 7 — 33 Income taxes payable — — — 73 (17 ) 56 Current liabilities of discontinued operations — — 77 721 (24 ) 774 Total current liabilities — 52 1,503 1,215 (86 ) 2,684 Long-term debt — 5,361 981 241 — 6,583 Deferred revenues — — 42 — — 42 Deferred income tax liabilities — — 1,752 38 (12 ) 1,778 Liability for guest loyalty program — — 889 — — 889 Other — 12 767 713 — 1,492 Non-current liabilities of discontinued operations — — (6 ) 6,900 — 6,894 Total liabilities — 5,425 5,928 9,107 (98 ) 20,362 Equity: Total Hilton stockholders' equity 5,899 5,889 11,300 6,993 (24,182 ) 5,899 Noncontrolling interests — — — (50 ) — (50 ) Total equity 5,899 5,889 11,300 6,943 (24,182 ) 5,849 TOTAL LIABILITIES AND EQUITY $ 5,899 $ 11,314 $ 17,228 $ 16,050 $ (24,280 ) $ 26,211 |
Condensed Statement of Income and Comprehensive Income | Three Months Ended March 31, 2017 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Revenues Franchise fees $ — $ — $ 274 $ 24 $ (4 ) $ 294 Base and other management fees — — 50 33 — 83 Incentive management fees — — 22 30 — 52 Owned and leased hotels — — — 300 — 300 Other revenues — — 33 4 — 37 — — 379 391 (4 ) 766 Other revenues from managed and franchised properties — — 1,265 130 — 1,395 Total revenues — — 1,644 521 (4 ) 2,161 Expenses Owned and leased hotels — — — 272 — 272 Depreciation and amortization — — 65 24 — 89 General and administrative — — 81 24 — 105 Other expenses — — 19 8 (4 ) 23 — — 165 328 (4 ) 489 Other expenses from managed and franchised properties — — 1,265 130 — 1,395 Total expenses — — 1,430 458 (4 ) 1,884 Operating income — — 214 63 — 277 Interest expense — (63 ) (28 ) (13 ) — (104 ) Gain (loss) on foreign currency transactions — — 32 (36 ) — (4 ) Loss on debt extinguishment — (60 ) — — — (60 ) Other non-operating income (loss), net — (3 ) 2 2 — 1 Income (loss) from continuing operations before income taxes and equity in earnings from subsidiaries — (126 ) 220 16 — 110 Income tax benefit (expense) — 49 (81 ) (3 ) — (35 ) Income (loss) from continuing operations before equity in earnings from subsidiaries — (77 ) 139 13 — 75 Equity in earnings from subsidiaries 74 151 12 — (237 ) — Net income 74 74 151 13 (237 ) 75 Net income attributable to noncontrolling interests — — — (1 ) — (1 ) Net income attributable to Hilton stockholders $ 74 $ 74 $ 151 $ 12 $ (237 ) $ 74 Comprehensive income $ 94 $ 72 $ 155 $ 30 $ (257 ) $ 94 Comprehensive loss (income) attributable to noncontrolling interests — — — — — — Comprehensive income attributable to Hilton stockholders $ 94 $ 72 $ 155 $ 30 $ (257 ) $ 94 Three Months Ended March 31, 2016 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Revenues Franchise fees $ — $ — $ 234 $ 22 $ (3 ) $ 253 Base and other management fees — — 32 28 — 60 Incentive management fees — — 8 28 — 36 Owned and leased hotels — — — 319 — 319 Other revenues — — 14 3 — 17 — — 288 400 (3 ) 685 Other revenues from managed and franchised properties — — 924 117 — 1,041 Total revenues — — 1,212 517 (3 ) 1,726 Expenses Owned and leased hotels — — — 307 — 307 Depreciation and amortization — — 68 24 — 92 Impairment loss — — — 15 — 15 General and administrative — — 57 26 — 83 Other expenses — — 9 12 (3 ) 18 — — 134 384 (3 ) 515 Other expenses from managed and franchised properties — — 924 117 — 1,041 Total expenses — — 1,058 501 (3 ) 1,556 Operating income — — 154 16 — 170 Interest expense — (67 ) (11 ) (12 ) — (90 ) Gain (loss) on foreign currency transactions — — 5 (17 ) — (12 ) Other non-operating income, net — — 2 — — 2 Income (loss) from continuing operations before income taxes and equity in earnings from subsidiaries — (67 ) 150 (13 ) — 70 Income tax benefit (expense) 192 26 (100 ) 3 — 121 Income (loss) from continuing operations before equity in earnings from subsidiaries 192 (41 ) 50 (10 ) — 191 Equity in earnings (losses) from subsidiaries — 41 (9 ) — (32 ) — Income (losses) from continuing operations, net of taxes 192 — 41 (10 ) (32 ) 191 Income from discontinued operations, net of taxes 117 117 117 106 (338 ) 119 Net income 309 117 158 96 (370 ) 310 Net income attributable to noncontrolling interests — — — (1 ) — (1 ) Net income attributable to Hilton stockholders $ 309 $ 117 $ 158 $ 95 $ (370 ) $ 309 Comprehensive income $ 319 $ 111 $ 149 $ 119 $ (380 ) $ 318 Comprehensive loss attributable to noncontrolling interests — — — 1 — 1 Comprehensive income attributable to Hilton stockholders $ 319 $ 111 $ 149 $ 120 $ (380 ) $ 319 |
Condensed Cash Flow Statement | Three Months Ended March 31, 2017 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Operating Activities: Net cash provided by (used in) operating activities $ — $ — $ (46 ) $ 112 $ (3 ) $ 63 Investing Activities: Capital expenditures for property and equipment — — (1 ) (8 ) — (9 ) Contract acquisition costs — — (8 ) (5 ) — (13 ) Capitalized software costs — — (9 ) — — (9 ) Other — (13 ) (6 ) — — (19 ) Net cash used in investing activities — (13 ) (24 ) (13 ) — (50 ) Financing Activities: Borrowings — 1,823 — — — 1,823 Repayment of debt — (1,823 ) — (1 ) — (1,824 ) Debt issuance costs and redemption premium — (66 ) — — — (66 ) Repayment of intercompany borrowings — — (3 ) — 3 — Intercompany transfers 119 79 91 (289 ) — — Dividends paid (49 ) — — — — (49 ) Cash transferred in spin-offs of Park and HGV — — — (501 ) — (501 ) Repurchases of common stock (70 ) — — — — (70 ) Distributions to noncontrolling interests — — — (1 ) — (1 ) Tax withholdings on share-based compensation — — (28 ) — — (28 ) Net cash provided by (used in) financing activities — 13 60 (792 ) 3 (716 ) Effect of exchange rate changes on cash, restricted cash and cash equivalents — — — 5 — 5 Net decrease in cash, restricted cash and cash equivalents — — (10 ) (688 ) — (698 ) Cash, restricted cash and cash equivalents from continuing operations, beginning of period — — 121 1,062 — 1,183 Cash, restricted cash and cash equivalents from discontinued operations, beginning of period — — — 501 — 501 Cash, restricted cash and cash equivalents, beginning of period — — 121 1,563 — 1,684 Cash, restricted cash and cash equivalents, end of period $ — $ — $ 111 $ 875 $ — $ 986 Three Months Ended March 31, 2016 Parent Subsidiary Issuers Guarantors Non-Guarantors Eliminations Total (in millions) Operating Activities: Net cash provided by (used in) operating activities $ — $ — $ (279 ) $ 618 $ — $ 339 Investing Activities: Capital expenditures for property and equipment — — — (84 ) — (84 ) Contract acquisition costs — — (8 ) (1 ) — (9 ) Capitalized software costs — — (10 ) (1 ) — (11 ) Other — — (9 ) 3 — (6 ) Net cash used in investing activities — — (27 ) (83 ) — (110 ) Financing Activities: Repayment of debt — — — (32 ) — (32 ) Intercompany transfers 69 — 317 (386 ) — — Dividends paid (69 ) — — — — (69 ) Distributions to noncontrolling interests — — — (2 ) — (2 ) Tax withholdings on share-based compensation — — (13 ) — — (13 ) Net cash provided by (used in) financing activities — — 304 (420 ) — (116 ) Effect of exchange rate changes on cash, restricted cash and cash equivalents — — — 4 — 4 Net increase (decrease) in cash, restricted cash and cash equivalents — — (2 ) 119 — 117 Cash, restricted cash and cash equivalents from continuing operations, beginning of period — — 108 526 — 634 Cash, restricted cash and cash equivalents from discontinued operations, beginning of period — — — 222 — 222 Cash, restricted cash and cash equivalents, beginning of period — — 108 748 — 856 Cash, restricted cash and cash equivalents from continuing operations, end of period — — 106 576 — 682 Cash, restricted cash and cash equivalents from discontinued operations, end of period — — — 291 — 291 Cash, restricted cash and cash equivalents, end of period $ — $ — $ 106 $ 867 $ — $ 973 |
Organization and Basis of Pre36
Organization and Basis of Presentation (Details) $ / shares in Units, $ in Millions | 3 Months Ended | |||
Mar. 31, 2017USD ($)RoomCountryHotel$ / sharesRateshares | Mar. 15, 2017Rateshares | Dec. 31, 2016$ / sharesshares | ||
Organization and Basis of Presentation [Line Items] | ||||
Number of hotel and resort properties | Hotel | 4,982 | |||
Number of hotel and resort rooms | Room | 812,341 | |||
Number of countries and territories | Country | 103 | |||
Reverse stock split | 1-for-3 | |||
Common stock, authorized shares | [1] | 10,000,000,000 | 10,000,000,000 | |
Common stock, par value (per share) | $ / shares | $ 0.01 | $ 0.01 | ||
Preferred stock, authorized shares | 3,000,000,000 | 3,000,000,000 | ||
Reclassification from common stock to additional paid in capital | $ | $ 7 | |||
HNA Tourism Group Co.,Ltd. purchase of Hilton common stock from Blackstone Group and Affiliates [Member] | ||||
Organization and Basis of Presentation [Line Items] | ||||
Hilton common stock acquired | 82,500,000 | |||
Common stock ownership percentage | Rate | 25.00% | |||
HNA Tourism Group Co., Ltd. [member] | ||||
Organization and Basis of Presentation [Line Items] | ||||
Common stock ownership percentage | Rate | 25.00% | |||
The Blackstone Group And Affiliates [member] | ||||
Organization and Basis of Presentation [Line Items] | ||||
Common stock ownership percentage | Rate | 15.20% | |||
Pre reverse stock split [member] | ||||
Organization and Basis of Presentation [Line Items] | ||||
Common stock, authorized shares | 30,000,000,000 | |||
Post reverse stock split [member] | ||||
Organization and Basis of Presentation [Line Items] | ||||
Common stock, authorized shares | 10,000,000,000 | |||
[1] | Adjusted to reflect the 1-for-3 reverse stock split that occurred on January 3, 2017. See Note 1: "Organization and Basis of Presentation" for additional information. |
Recently Issued Accounting Pr37
Recently Issued Accounting Pronouncements Impact of Recently Issued Accounting Pronouncements (Details) $ in Millions | Jan. 01, 2017USD ($) |
Impact of Recently Adopted Accounting Pronouncements [Abstract] | |
Cumulative effect of new accounting principle in period of adoption | $ 1 |
Discontinued Operations - Balan
Discontinued Operations - Balance Sheet Disclosures (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Total current assets of discontinued operations | $ 0 | $ 1,478 |
Total non-current assets of discontinued operations | 0 | 10,347 |
Total current liabilities of discontinued operations | $ 0 | 774 |
Park and HGV spin-offs [Member] | Discontinued operations, disposed of by means other than sale, spinoff [member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Cash and cash equivalents | 341 | |
Restricted cash and cash equivalents | 160 | |
Accounts receivable, net of allowance for doubtful accounts | 250 | |
Prepaid expenses | 48 | |
Inventories | 527 | |
Current portion of financing receivables, net | 136 | |
Other | 16 | |
Total current assets of discontinued operations | 1,478 | |
Variable interest entity current assets of discontinued operations | 92 | |
Goodwill | 604 | |
Management and franchise contracts, net | 56 | |
Other intangible assets, net | 60 | |
Property and equipment, net | 8,589 | |
Deferred income tax assets | 35 | |
Financing receivables, net | 895 | |
Investments in affiliates | 81 | |
Other | 27 | |
Total non-current assets of discontinued operations | 10,347 | |
Variable interest entity non-current assets of discontinued operations | 405 | |
Total assets of discontinued operations | 11,825 | |
Accounts payable, accrued expenses and other | 632 | |
Current maturities of long-term debt | 65 | |
Current maturities of timeshare debt | 73 | |
Income taxes payable | 4 | |
Total current liabilities of discontinued operations | 774 | |
Variable interest entity current liabilities of discontinued operations | 81 | |
Long-term debt | 3,437 | |
Timeshare debt | 621 | |
Deferred revenues | 22 | |
Deferred income tax liabilities | 2,797 | |
Other | 17 | |
Total liabilities of discontinued operations | 7,668 | |
Variable interest entity liabilities of discontinued operations | $ 506 |
Discontinued Operations - Incom
Discontinued Operations - Income Statement Disclosures (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Income from discontinued operations, net of taxes | $ 0 | $ 119 |
Park and HGV spin-offs [Member] | Discontinued operations, disposed of by means other than sale, spinoff [member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Franchise fees | 10 | |
Base and other management fees | 7 | |
Owned and leased hotels | 648 | |
Timeshare | 326 | |
Other revenues | 3 | |
Other revenues from managed and franchised properties | 30 | |
Total revenues from discontinued operations | 1,024 | |
Owned and leased hotels | 449 | |
Timeshare | 217 | |
Depreciation and amortization | 77 | |
General and administrative | 10 | |
Other expenses | 2 | |
Other expenses from managed and franchised properties | 30 | |
Total expenses from discontinued operations | 785 | |
Operating income from discontinued operations | 239 | |
Interest expense | (49) | |
Other non-operating income, net | 4 | |
Income from discontinued operations before income taxes | 194 | |
Income tax expense | (75) | |
Income from discontinued operations, net of taxes | 119 | |
Income from discontinued operations attributable to noncontrolling interests, net of taxes | (2) | |
Income from discontinued operations attributable to Hilton stockholders, net of taxes | $ 117 |
Discontinued Operations - Non-c
Discontinued Operations - Non-cash Items and Capital Expenditures (Details) - Park and HGV spin-offs [Member] - Discontinued operations, disposed of by means other than sale, spinoff [member] $ in Millions | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |
Depreciation and amortization | $ 77 |
Capital expenditures for property and equipment | $ 68 |
Discontinued Operations - Addit
Discontinued Operations - Additional Information (Details) - Discontinued operations, disposed of by means other than sale, spinoff [member] - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Jan. 03, 2017 | |
Park and HGV spin-offs [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Distribution of of spin-off companies stock to Hilton stockholders | 100.00% | |
Park spin-off [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Park common stock distributed for every five shares of Hilton common stock | 1 | |
Hilton common stock to receive spin-off company common stock | 5 | |
Revenues from discontinued operations after disposal | $ 39 | |
HGV spin-off [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Hilton common stock to receive spin-off company common stock | 10 | |
HGV common stock distributed for every ten shares of Hilton common stock | 1 | |
Revenues from discontinued operations after disposal | $ 20 | |
Distribution Agreement [Member] | Park spin-off [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Allocation of certain contingent liabilities among the parties | 26.00% | |
Distribution Agreement [Member] | HGV spin-off [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Allocation of certain contingent liabilities among the parties | 9.00% | |
Distribution Agreement [Member] | Hilton [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Allocation of certain contingent liabilities among the parties | 65.00% | |
Tax Matters Agreement [Member] | Park and HGV spin-offs [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Discontinued Operation, Period of Continuing Involvement after Disposal | 2 years | |
Transition Services Agreement [Member] | Park and HGV spin-offs [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Discontinued Operation, Period of Continuing Involvement after Disposal | 2 years | |
License Agreement [Member] | HGV spin-off [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Discontinued Operation, Period of Continuing Involvement after Disposal | 100 years | |
Royalty fee rate | 5.00% | |
Transition fee | $ 5 | |
Term of transition fee payments | 5 years | |
Tax Stockholders Agreement [Member] | Park and HGV spin-offs [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Discontinued Operation, Period of Continuing Involvement after Disposal | 2 years | |
Management and Franchise Agreements [Member] | Park spin-off [Member] | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Base management fee rate | 3.00% | |
Incentive management fee rate | 6.00% |
Consolidated Variable Interes42
Consolidated Variable Interest Entities - Additional Information (Details) - Entity | Mar. 31, 2017 | Dec. 31, 2016 |
Variable Interest Entity [Line Items] | ||
Number of consolidated variable interest entities | 3 | 3 |
Hotel VIEs [member] | ||
Variable Interest Entity [Line Items] | ||
Number of consolidated variable interest entities | 2 | 2 |
Condo management VIE [member] | ||
Variable Interest Entity [Line Items] | ||
Number of consolidated variable interest entities | 1 | 1 |
Consolidated Variable Interes43
Consolidated Variable Interest Entities - Schedule of Consolidated Variable Interest Entities (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Variable Interest Entity [Line Items] | ||
Cash and cash equivalents | $ 862 | $ 1,062 |
Accounts receivable, net | 911 | 755 |
Property and equipment, net | 341 | 341 |
Deferred income tax assets | 82 | 82 |
Other non-current assets | 443 | 408 |
Accounts payable, accrued expenses and other | 1,798 | 1,821 |
Long-term debt | 6,588 | 6,583 |
Consolidated VIEs [member] | ||
Variable Interest Entity [Line Items] | ||
Cash and cash equivalents | 55 | 57 |
Accounts receivable, net | 14 | 14 |
Property and equipment, net | 55 | 52 |
Deferred income tax assets | 61 | 58 |
Other non-current assets | 56 | 53 |
Accounts payable, accrued expenses and other | 34 | 33 |
Long-term debt | $ 222 | $ 212 |
Goodwill and Intangible Asset44
Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Dec. 31, 2016 | ||
Goodwill [Line Items] | |||
Goodwill | $ 5,218 | ||
Spin-offs of Park and HGV | (91) | ||
Foreign currency translation | 8 | ||
Goodwill | 5,135 | ||
Ownership [member] | |||
Goodwill [Line Items] | |||
Goodwill, gross carrying value | 856 | ||
Accumulated impairment losses | (672) | ||
Goodwill | [1] | 184 | |
Gross carrying value of goodwill included in discontinued operations | $ 2,706 | ||
Accumulated impairment losses included in discontinued operations | $ 2,102 | ||
Gross goodwill, disposed of related to spin-offs of Park and HGV | (423) | ||
Accumulated impairment losses, disposed of related to spin-offs of Park and HGV | 332 | ||
Spin-offs of Park and HGV | [1] | (91) | |
Foreign currency translation | [1] | 2 | |
Goodwill, gross carrying value | 435 | ||
Accumulated impairment losses | (340) | ||
Goodwill | [1] | 95 | |
Management and franchise [member] | |||
Goodwill [Line Items] | |||
Goodwill | [2] | 5,034 | |
Spin-offs of Park and HGV | [2] | 0 | |
Foreign currency translation | [2] | 6 | |
Goodwill | [2] | $ 5,040 | |
[1] | Excludes goodwill of $2,706 million and accumulated impairment losses of $2,102 million that were attributable to Park and included in non-current assets of discontinued operations in the condensed consolidated balance sheet as of December 31, 2016. Total goodwill balances for the ownership reporting unit include the following gross carrying values and accumulated impairment losses for the periods presented: Gross Carrying Value Accumulated Impairment Losses Net Carrying Value (in millions)Balance as of December 31, 2016$856 $(672) $184Spin-offs of Park and HGV(423) 332 (91)Foreign currency translation2 — 2Balance as of March 31, 2017$435 $(340) $95 | ||
[2] | There were no accumulated impairment losses for the management and franchise reporting unit as of March 31, 2017 and December 31, 2016. |
Goodwill and Intangible Asset45
Goodwill and Intangible Assets - Schedule of Other Intangible Assets (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | |||
Management and franchise contracts, gross | $ 2,579 | $ 2,564 | |
Other intangible assets, gross | 1,172 | 1,158 | |
Amortizing intangibles assets, accumulated amortization | (1,649) | (1,601) | |
Other intangible assets, accumulated amortization | 741 | 711 | |
Management and franchise contracts, net | 930 | 963 | |
Other intangible assets, net | 431 | 447 | |
Brands | [1] | 4,856 | 4,848 |
Management and franchise contracts recorded at Merger [member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Management and franchise contracts, gross | [1] | 2,225 | 2,221 |
Amortizing intangibles assets, accumulated amortization | [1] | (1,578) | (1,534) |
Management and franchise contracts, net | [1] | 647 | 687 |
Contract acquisition costs and other [member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Management and franchise contracts, gross | 354 | 343 | |
Amortizing intangibles assets, accumulated amortization | (71) | (67) | |
Management and franchise contracts, net | 283 | 276 | |
Leases [member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Other intangible assets, gross | [1] | 279 | 276 |
Amortizing intangibles assets, accumulated amortization | [1] | (132) | (126) |
Other intangible assets, net | [1] | 147 | 150 |
Capitalized software [member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Other intangible assets, gross | 519 | 510 | |
Amortizing intangibles assets, accumulated amortization | (380) | (362) | |
Other intangible assets, net | 139 | 148 | |
Hilton Honors [member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Other intangible assets, gross | [1] | 336 | 335 |
Amortizing intangibles assets, accumulated amortization | [1] | (198) | (192) |
Other intangible assets, net | [1] | 138 | 143 |
Other [member] | |||
Finite-Lived Intangible Assets [Line Items] | |||
Other intangible assets, gross | 38 | 37 | |
Amortizing intangibles assets, accumulated amortization | (31) | (31) | |
Other intangible assets, net | $ 7 | $ 6 | |
[1] | Represents intangible assets that were initially recorded at their fair value as part of the October 24, 2007 transaction whereby we became a wholly owned subsidiary of an affiliate of Blackstone (the "Merger"). |
Goodwill and Intangible Asset46
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of Intangible Assets | $ 74 | $ 78 |
Capitalized software [member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of Intangible Assets | $ 17 | $ 22 |
Goodwill and Intangible Asset47
Goodwill and Intangible Assets - Schedule of Future Amortization (Details) $ in Millions | Mar. 31, 2017USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2017 (remaining) | $ 211 |
2,018 | 267 |
2,019 | 248 |
2,020 | 201 |
2,021 | 71 |
Thereafter | 363 |
Amortizing intangible assets, net | $ 1,361 |
Debt - Long-term Debt (Details)
Debt - Long-term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Mar. 01, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 6,718 | $ 6,706 | ||
Debt instrument, unamortized discount (premium) and debt issuance costs, net | (89) | (90) | ||
Current maturities of long-term debt | [1] | (41) | (33) | |
Long-term debt | 6,588 | 6,583 | ||
Senior notes [member] | Senior notes due 2021 [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | 0 | 1,500 | ||
Senior notes [member] | Senior notes due 2024 [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 1,000 | 1,000 | ||
Debt instrument, interest rate, stated percentage | 4.25% | |||
Senior notes [member] | Senior notes due 2025 [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 900 | 0 | ||
Debt instrument, interest rate, stated percentage | 4.625% | |||
Senior notes [member] | Senior notes due 2027 [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 600 | 0 | ||
Debt instrument, interest rate, stated percentage | 4.875% | |||
Secured debt [member] | Senior secured term loan facility due 2020 [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 0 | $ 750 | 750 | |
Secured debt [member] | Senior secured term loan facility due 2023 [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 3,959 | $ 3,209 | 3,209 | |
Debt instrument, interest rate, stated percentage | 2.98% | |||
Capital lease obligations [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 237 | 227 | ||
Debt instrument, weighted average interest rate | 6.34% | |||
Mortgages [member] | ||||
Debt Instrument [Line Items] | ||||
Long-term debt, gross | $ 22 | $ 20 | ||
Debt instrument, weighted average interest rate | 2.65% | |||
[1] | Net of unamortized deferred financing costs and discount attributable to current maturities of long-term debt. |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 01, 2017 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | |||
Long-term debt, gross | $ 6,718 | $ 6,706 | |
Senior notes [member] | Senior notes due 2025 [member] | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | $ 900 | 0 | |
Debt instrument, interest rate, stated percentage | 4.625% | ||
Senior notes [member] | Senior notes due 2027 [member] | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | $ 600 | 0 | |
Debt instrument, interest rate, stated percentage | 4.875% | ||
Senior notes [member] | Senior notes due 2025 and senior notes due 2027 [Member] | |||
Debt Instrument [Line Items] | |||
Debt issuance costs, gross | $ 21 | ||
Senior notes [member] | Senior notes due 2021 [member] | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | 0 | 1,500 | |
Premium paid to redeem debt instrument | 42 | ||
Write off of deferred debt issuance cost | 18 | ||
Secured debt [member] | Senior secured revolving credit facility [Member] | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | 1,000 | ||
Letters of credit outstanding, amount | 23 | ||
Line of credit facility, remaining borrowing capacity | 977 | ||
Secured debt [member] | Senior secured term loan facility due 2020 [member] | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | 0 | $ 750 | 750 |
Secured debt [member] | Senior secured term loan facility due 2023 [member] | |||
Debt Instrument [Line Items] | |||
Long-term debt, gross | $ 3,959 | $ 3,209 | $ 3,209 |
Debt instrument, interest rate, stated percentage | 2.98% | ||
Debt issuance costs, gross | $ 3 | ||
Debt instrument, basis spread on variable rate | 2.00% |
Debt - Debt Maturities (Details
Debt - Debt Maturities (Details) - Long-term debt and capital lease obligations [member] $ in Millions | Mar. 31, 2017USD ($) |
Debt Instrument [Line Items] | |
2017 (remaining) | $ 36 |
2,018 | 59 |
2,019 | 55 |
2,020 | 56 |
2,021 | 57 |
Thereafter | 6,455 |
Long-term debt, including current maturities | $ 6,718 |
Derivative Instruments and He51
Derivative Instruments and Hedging Activities - Fair Value of Derivative Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Other liabilities [member] | Designated as hedging instrument [member] | Term loan interest rate swaps [member] | ||
Derivative [Line Items] | ||
Derivative liability | $ 7 | |
Other liabilities [member] | Not designated as hedging instrument [member] | Term loan interest rate swaps [member] | ||
Derivative [Line Items] | ||
Derivative liability | 0 | $ 12 |
Other current assets [member] | Not designated as hedging instrument [member] | Foreign exchange forward contracts [member] | ||
Derivative [Line Items] | ||
Derivative asset | 1 | 3 |
Accounts payable, accrued expenses and other [member] | Not designated as hedging instrument [member] | Foreign exchange forward contracts [member] | ||
Derivative [Line Items] | ||
Derivative liability | $ 1 | $ 4 |
Derivative Instruments and He52
Derivative Instruments and Hedging Activities - Earnings Effect of Derivative Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Term loan interest rate swaps [member] | Designated as hedging instrument [member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Derivative instruments, gain (loss) recognized in other comprehensive income, effective portion, net | [1] | $ (7) | $ (10) |
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net | [1] | 0 | 0 |
Other non-operating income, net [member] | Term loan interest rate swaps [member] | Not designated as hedging instrument [member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (Loss) on Interest Rate Derivative Instruments Not Designated as Hedging Instruments | 2 | ||
Interest expense [member] | Term loan interest rate swaps [member] | Not designated as hedging instrument [member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (Loss) Reclassified to Earnings, Net from Discontinued Cash Flow Hedges | [2] | 3 | |
Loss on foreign currency transactions [member] | Foreign exchange forward contracts [member] | Not designated as hedging instrument [member] | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Gain (loss) on foreign exchange forward contracts not designated as hedging instruments | $ 1 | $ 1 | |
[1] | There were no amounts recognized in earnings related to hedge ineffectiveness or amounts excluded from hedge effectiveness testing during the three months ended March 31, 2017 and 2016. | ||
[2] | This amount is related to the dedesignation of the 2013 Interest Rate Swaps as cash flow hedges and was reclassified from accumulated other comprehensive loss as the underlying transactions occurred. |
Derivative Instruments and He53
Derivative Instruments and Hedging Activities - Additional Information (Details) $ in Millions | Mar. 31, 2017USD ($)Derivative | Dec. 31, 2016USD ($)Derivative |
Designated as hedging instrument [member] | Term loan interest rate swaps [member] | ||
Derivative [Line Items] | ||
Number of interest rate derivatives held | Derivative | 2 | |
Not designated as hedging instrument [member] | Term loan interest rate swaps [member] | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 1,450 | |
Derivative, swaption interest rate | 1.87% | |
Number of interest rate derivatives held | Derivative | 4 | |
Not designated as hedging instrument [member] | Foreign exchange forward contracts [member] | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 255 | |
Number of foreign exchange forward contracts held | Derivative | 63 | |
$1.6 billion notional [Member] | Designated as hedging instrument [member] | Term loan interest rate swaps [member] | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 1,600 | |
Derivative, swaption interest rate | 1.98% | |
$750 million notional [Member] | Designated as hedging instrument [member] | Term loan interest rate swaps [member] | ||
Derivative [Line Items] | ||
Derivative, notional amount | $ 750 | |
Derivative, swaption interest rate | 2.02% |
Fair Value Measurements Schedul
Fair Value Measurements Schedule by Balance Sheet Grouping (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | |
Level 1 [member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt | $ 2,512 | $ 2,516 | |
Level 2 [member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Cash equivalents | 580 | 782 | |
Restricted cash equivalents | 12 | 11 | |
Interest rate swaps | 7 | 12 | |
Level 3 [member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt | 3,996 | 4,006 | |
Carrying value [member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Cash equivalents | 580 | 782 | |
Restricted cash equivalents | 12 | 11 | |
Long-term debt | [1] | 6,370 | 6,369 |
Interest rate swaps | $ 7 | $ 12 | |
[1] | Carrying value includes unamortized deferred financing costs and discount. The carrying values and fair values exclude capital lease obligations and other debt. |
Income Taxes (Details)
Income Taxes (Details) $ in Millions | Mar. 31, 2017USD ($) |
Income Tax Disclosure [Abstract] | |
Unrecognized tax benefits | $ 174 |
Accrual for interest and penalties | 33 |
Decrease in unrecognized tax benefits reasonably possible in next 12 months | 8 |
Unrecognized tax benefits that would impact effective tax rate | 173 |
Taxing authority proposed tax owed adjustment | 874 |
Accrual for taxing authority proposed tax owed adjustment | $ 46 |
Share-Based Compensation - Addi
Share-Based Compensation - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based compensation expense | $ 25 | $ 16 | |
Unrecognized compensation costs related to unvested awards | $ 171 | ||
Unrecognized compensation costs related to unvested awards, weighted-average period | 2 years 5 months | ||
Shares of common stock reserved for future issuance | 29,922,923 | ||
Incremental compensation expense from the Conversion Factor | $ 0 | ||
Conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | 671,604 | ||
2015 and 2016 performance shares conversion percentage to restricted stock units | 100.00% | ||
Restricted stock units (RSUs) [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | [1] | 671,604 | |
Restricted stock units (RSUs) [member] | Minimum [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 2 years | ||
Restricted stock units (RSUs) [member] | Maximum [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Employee stock option [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Options, expiration period | 10 years | ||
Options, grants in period, grant date fair value | $ 13.86 | ||
Performance shares [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Anticipated achievement percentage | 100.00% | ||
Free cash flow CAGR [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting rights, percentage | 50.00% | ||
EBITDA CAGR [member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | 335,802 | ||
Vesting rights, percentage | 50.00% | ||
[1] | Represents all performance shares outstanding as of December 31, 2016. |
Share-Based Compensation - Sche
Share-Based Compensation - Schedule of Restricted Stock Units Award Activity (Details) (Details) | 3 Months Ended | |
Mar. 31, 2017$ / sharesshares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | 671,604 | |
Restricted stock units (RSUs) [member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding, beginning balance | 1,624,541 | |
Conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | 671,604 | [1] |
Effect of the spin-offs | 439,113 | |
Granted | 1,313,783 | |
Vested | (876,145) | |
Forfeited | (47,971) | |
Outstanding, ending balance | 3,124,925 | |
Weighted average grant date fair value, outstanding beginning balance | $ / shares | $ 65.24 | |
Weighted average grant date fair value, conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | $ / shares | 72.42 | [1] |
Weighted average grant date fair value, effect of the spin-offs | $ / shares | 57.60 | |
Weighted average grant date fair value, granted | $ / shares | 58.02 | |
Weighted average grant date fair value, vested | $ / shares | 47.19 | |
Weighted average grant date fair value, forfeited | $ / shares | 47.97 | |
Weighted average grant date fair value, outstanding ending balance | $ / shares | $ 52.01 | [2] |
[1] | Represents all performance shares outstanding as of December 31, 2016. | |
[2] | The weighted average grant date fair value was adjusted to reflect the Conversion Factor. |
Share-Based Compensation - Sc58
Share-Based Compensation - Schedule of Stock Options Activity (Details) - Employee stock option [member] | 3 Months Ended | |
Mar. 31, 2017$ / sharesshares | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Outstanding, beginning balance | shares | 1,076,031 | |
Effect of the spin-offs | shares | 251,145 | |
Granted | shares | 710,967 | |
Exercised | shares | (10,681) | |
Forfeited, canceled or expired | shares | (2,146) | |
Outstanding, ending balance | shares | 2,025,316 | |
Exercisable | shares | 793,005 | |
Weighted average exercise price, beginning balance | $ / shares | $ 66.83 | |
Weighted average exercise price, effect of the spin-offs | $ / shares | 57.60 | |
Weighted average grant date fair value, granted | $ / shares | 58.02 | |
Weighted average grant date fair value, exercised | $ / shares | 45.35 | |
Weighted average grant date fair value, forfeited, canceled or expired | $ / shares | 57.99 | |
Weighted average exercise price, ending balance | $ / shares | 50.89 | [1] |
Weighted average exercise price, exercisable | $ / shares | $ 48.23 | [1] |
[1] | The weighted average exercise price was adjusted to reflect the Conversion Factor. |
Share-Based Compensation - Sc59
Share-Based Compensation - Schedule of Stock Options Valuation Assumptions (Details) - Employee stock option [member] | 3 Months Ended | |
Mar. 31, 2017Rate | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expected volatility rate | 24.00% | [1] |
Dividend yield | 1.03% | [2] |
Risk-free interest rate | 2.03% | [3] |
Expected term (in years) | 6 years | [4] |
[1] | Due to limited trading history for our common stock, we did not have sufficient information available on which to base a reasonable and supportable estimate of the expected volatility of our share price. As a result, we used an average historical volatility of our peer group over a time period consistent with our expected term assumption. Our peer group was determined based upon companies in our industry with similar business models and is consistent with those used to benchmark our executive compensation. | |
[2] | Estimated based on the expected annualized dividend payment at the date of grant. | |
[3] | Based on the yields of U.S. Department of Treasury instruments with similar expected lives. | |
[4] | Estimated using the average of the vesting periods and the contractual term of the options. |
Share-Based Compensation - Sc60
Share-Based Compensation - Schedule of Performance Shares Activity (Details) | 3 Months Ended |
Mar. 31, 2017$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | (671,604) |
EBITDA CAGR [member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding, beginning balance | 335,802 |
Conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | (335,802) |
Granted | 169,843 |
Outstanding, ending balance | 169,843 |
Weighted average grant date fair value, outstanding beginning balance | $ / shares | $ 68.09 |
Weighted average grant date fair value, conversion from Performance Shares to Restricted Stock Units upon completion of the spin-offs | $ / shares | 68.09 |
Weighted average grant date fair value, granted | $ / shares | 58.02 |
Weighted average grant date fair value, outstanding ending balance | $ / shares | $ 58.02 |
Free cash flow CAGR [member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding, beginning balance | 0 |
Granted | 169,812 |
Outstanding, ending balance | 169,812 |
Weighted average grant date fair value, granted | $ / shares | $ 58.02 |
Weighted average grant date fair value, outstanding ending balance | $ / shares | $ 58.02 |
Stockholders' Equity and Accu61
Stockholders' Equity and Accumulated Other Comprehensive Loss - Schedule of Stockholders' Equity (Details) - USD ($) $ in Millions | 3 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | |||
Class of Stock [Line Items] | ||||
Beginning Balance | $ 5,849 | $ 5,951 | ||
Beginning Balance, shares | [1] | 329,341,992 | ||
Share-based compensation | $ (7) | 2 | ||
Repurchases of common stock, purchase price | (70) | |||
Income (Loss) Attributable to Parent | 74 | 309 | ||
Net Income (Loss) Attributable to Noncontrolling Interest | 1 | 1 | ||
Net income | 75 | 310 | ||
Comprehensive income attributable to Hilton stockholders | 94 | 319 | ||
Total other comprehensive income (loss) | 19 | 8 | ||
Comprehensive loss attributable to noncontrolling interests | 0 | (1) | ||
Dividends | (50) | (69) | ||
Spin-offs of Park and HGV | (4,219) | |||
Cumulative effect of the adoption of ASU 2016-09 | 0 | 5 | ||
Distributions | $ (1) | (2) | ||
Ending Balance, shares | [1] | 329,628,890 | ||
Ending Balance | $ 1,596 | 6,205 | ||
Common Stock [member] | ||||
Class of Stock [Line Items] | ||||
Beginning Balance | [2] | $ 3 | $ 3 | |
Beginning Balance, shares | [2] | 329,000,000 | 329,000,000 | |
Share-based payment award transactions net shares | 2,000,000 | 0 | ||
Repurchases of common stock, shares | (1,000,000) | |||
Ending Balance, shares | 330,000,000 | 329,000,000 | [2] | |
Ending Balance | $ 3 | $ 3 | [2] | |
Treasury Stock [member] | ||||
Class of Stock [Line Items] | ||||
Beginning Balance | $ 0 | |||
Repurchases of common stock, shares | (1,213,415) | |||
Repurchases of common stock, purchase price | $ (70) | |||
Ending Balance | (70) | |||
Additional Paid-in Capital [member] | ||||
Class of Stock [Line Items] | ||||
Beginning Balance | [2] | 10,220 | 10,158 | |
Share-based compensation | (7) | 2 | [2] | |
Cumulative effect of the adoption of ASU 2016-09 | 1 | |||
Ending Balance | 10,214 | 10,160 | [2] | |
Accumulated Deficit [member] | ||||
Class of Stock [Line Items] | ||||
Beginning Balance | (3,323) | (3,392) | ||
Income (Loss) Attributable to Parent | 74 | 309 | ||
Dividends | (50) | (69) | ||
Spin-offs of Park and HGV | (4,331) | |||
Cumulative effect of the adoption of ASU 2016-09 | (1) | |||
Ending Balance | (7,631) | (3,152) | ||
Accumulated Other Comprehensive Loss [member] | ||||
Class of Stock [Line Items] | ||||
Beginning Balance | (1,001) | (784) | ||
Comprehensive income attributable to Hilton stockholders | 20 | 10 | ||
Spin-offs of Park and HGV | 63 | |||
Ending Balance | (918) | (774) | ||
Noncontrolling Interest [member] | ||||
Class of Stock [Line Items] | ||||
Beginning Balance | (50) | (34) | ||
Net Income (Loss) Attributable to Noncontrolling Interest | 1 | 1 | ||
Comprehensive loss attributable to noncontrolling interests | [3] | (1) | (2) | |
Spin-offs of Park and HGV | 49 | |||
Cumulative effect of the adoption of ASU 2016-09 | 5 | |||
Distributions | (1) | (2) | ||
Ending Balance | $ (2) | $ (32) | ||
[1] | Adjusted to reflect the 1-for-3 reverse stock split that occurred on January 3, 2017. See Note 1: "Organization and Basis of Presentation" for additional information. | |||
[2] | Adjusted to reflect the Reverse Stock Split. See Note 1: "Organization and Basis of Presentation" for additional information. | |||
[3] | Other comprehensive loss attributable to non-controlling interests was related to a currency translation adjustment. |
Stockholders' Equity and Accu62
Stockholders' Equity and Accumulated Other Comprehensive Loss - Additional Information (Details) $ / shares in Units, $ in Millions | 3 Months Ended |
Mar. 31, 2017USD ($)$ / sharesshares | |
Equity, Class of Treasury Stock [Line Items] | |
Stock repurchase program, authorized amount | $ 1,000 |
Common stock repurchased, average cost per share | $ / shares | $ 57.67 |
Repurchases of common stock, purchase price | $ 70 |
Stock repurchase program, remaining authorized repurchase amount | $ 930 |
Treasury Stock [member] | |
Equity, Class of Treasury Stock [Line Items] | |
Repurchases of common stock, shares | shares | 1,213,415 |
Repurchases of common stock, purchase price | $ 70 |
Stockholders' Equity and Accu63
Stockholders' Equity and Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Loss (Detail) - USD ($) $ in Millions | 3 Months Ended | ||||
Mar. 31, 2017 | Mar. 31, 2016 | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance | $ (1,001) | $ (784) | |||
Other comprehensive income (loss) before reclassifications | 16 | 9 | |||
Amounts reclassified from accumulated other comprehensive loss | 4 | 1 | |||
Net current period other comprehensive income (loss) | 20 | 10 | |||
Spin-offs of Park and HGV | (4,219) | ||||
Ending balance | (918) | (774) | |||
Currency translation adjustment [member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Beginning balance | (738) | [1] | (580) | [2] | |
Other comprehensive income (loss) before reclassifications | 21 | [1] | 15 | [2] | |
Amounts reclassified from accumulated other comprehensive loss | 0 | [1] | 0 | [2] | |
Net current period other comprehensive income (loss) | 21 | [1] | 15 | [2] | |
Spin-offs of Park and HGV | 63 | ||||
Ending balance | (654) | [1] | (565) | [2] | |
Pension liability adjustment [member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Tax benefit on pension liability adjustment reclassifications | [3] | 1 | 1 | ||
Beginning balance | (251) | [3] | (194) | [4] | |
Other comprehensive income (loss) before reclassifications | (1) | [3] | 0 | [4] | |
Amounts reclassified from accumulated other comprehensive loss | 2 | [3] | 1 | [4] | |
Net current period other comprehensive income (loss) | 1 | [3] | 1 | [4] | |
Spin-offs of Park and HGV | [3] | 0 | |||
Ending balance | (250) | [3] | (193) | [4] | |
Cash flow hedge adjustment [member] | |||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||||
Tax benefit on cash flow hedge adjustment reclassifications | [5] | (1) | |||
Beginning balance | (12) | [5] | (10) | ||
Other comprehensive income (loss) before reclassifications | (4) | [5] | (6) | ||
Amounts reclassified from accumulated other comprehensive loss | 2 | [5] | 0 | ||
Net current period other comprehensive income (loss) | (2) | [5] | (6) | ||
Spin-offs of Park and HGV | [5] | 0 | |||
Ending balance | $ (14) | [5] | $ (16) | ||
[1] | Includes net investment hedges and intra-entity foreign currency transactions that are of a long-term investment nature. | ||||
[2] | Includes net investment hedges and intra-entity foreign currency transactions that are of a long-term investment nature. | ||||
[3] | Amounts reclassified include the amortization of prior service cost and net loss that were included in our computation of net periodic pension cost. They were recognized in general and administrative expenses, net of a $1 million tax benefit, in our condensed consolidated statement of operations. | ||||
[4] | Amounts reclassified were recognized in general and administrative expenses, net of a $1 million tax benefit, in our condensed consolidated statement of operations. | ||||
[5] | Amounts reclassified related to the 2013 Interest Rate Swaps and were recognized in interest expense, net of a $1 million tax benefit, in our condensed consolidated statement of operations. |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Net income from continuing operations attributable to Hilton stockholders | $ 74 | $ 192 | |
Basic EPS: | |||
Weighted average shares outstanding, basic | 330 | 329 | |
Net income from continuing operations per share, basic | $ 0.22 | $ 0.58 | [1] |
Diluted EPS: | |||
Weighted average shares outstanding, diluted | 331 | 330 | |
Net income from continuing operations per share, diluted | $ 0.22 | $ 0.58 | [1] |
Share based compensation awards [member] | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Antidilutive securities excluded from computation of EPS, amount | 1 | 1 | |
[1] | Weighted average shares outstanding used in the computation of basic and diluted earnings per share and cash dividends declared per share were adjusted to reflect the 1-for-3Â reverse stock split that occurred on January 3, 2017. See Note 1: "Organization and Basis of Presentation" for additional information. |
Business Segments - Hotel Prope
Business Segments - Hotel Properties by Segment (Detail) | 3 Months Ended |
Mar. 31, 2017RoomHotel | |
Segment Reporting Information [Line Items] | |
Number of operating business segments | 2 |
Management and franchise [member] | |
Segment Reporting Information [Line Items] | |
Number of managed hotels | 624 |
Number of franchised hotels | 4,236 |
Number of managed and franchised hotels | 4,860 |
Number of managed and franchised hotel rooms | Room | 781,978 |
Ownership [member] | |
Segment Reporting Information [Line Items] | |
Number of owned and leased hotels | 74 |
Number of owned and leased hotel rooms | Room | 22,278 |
Number of wholly owned and leased hotels | 65 |
Number of non-wholly owned hotels | 1 |
Number of hotels of consolidated VIEs | 2 |
Number of hotels owned or leased by unconsolidated joint ventures | 6 |
Discontinued operations, disposed of by means other than sale, spinoff [member] | |
Segment Reporting Information [Line Items] | |
Number of managed and franchised hotels | 67 |
Number of managed and franchised hotel rooms | Room | 35,425 |
Business Segments - Reconciliat
Business Segments - Reconciliation of Revenue from Segment Amounts to Consolidated Amounts (Detail) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total revenues | $ 2,161 | $ 1,726 | |
Other revenues | 37 | 17 | |
Other revenues from managed and franchised properties | 1,395 | 1,041 | |
Ownership [member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total revenues | 300 | 319 | |
Management and franchise [member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total revenues | [1] | 436 | 357 |
Operating segments [member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total revenues | 736 | 676 | |
Intersegment eliminations [member] | |||
Segment Reporting, Revenue Reconciling Item [Line Items] | |||
Total revenues | [1] | $ (7) | $ (8) |
[1] | Includes management, royalty and intellectual property fees charged to our ownership segment, which were eliminated in our condensed consolidated financial statements. |
Business Segments - Reconcili67
Business Segments - Reconciliation of segment operating income to consolidated income from continuing operations before income taxes (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | ||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Operating income | $ 277 | $ 170 | |
Other revenues, less other expenses | 14 | (1) | |
Depreciation and amortization | (89) | (92) | |
Impairment loss | 0 | (15) | |
General and administrative | (105) | (83) | |
Interest expense | (104) | (90) | |
Loss on foreign currency transactions | (4) | (12) | |
Loss on debt extinguishment | (60) | 0 | |
Other non-operating income, net | 1 | 2 | |
Income from continuing operations before income taxes | 110 | 70 | |
Management and franchise [member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Operating income | [1] | 436 | 357 |
Ownership [member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Operating income | [1] | 21 | 4 |
Operating segments [member] | |||
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items] | |||
Operating income | $ 457 | $ 361 | |
[1] | Includes management, royalty and intellectual property fees charged to our ownership segment by our management and franchise segment, which were eliminated in our condensed consolidated financial statements. |
Business Segments - Schedule of
Business Segments - Schedule of Assets by Segment (Detail) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 |
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 14,287 | $ 26,211 |
Total assets of continuing operations | 14,386 | |
Corporate and other [member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 2,536 | 2,529 |
Management and franchise [member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | 10,806 | 10,825 |
Ownership [member] | ||
Segment Reporting, Asset Reconciling Item [Line Items] | ||
Total assets | $ 945 | $ 1,032 |
Business Segments - Schedule 69
Business Segments - Schedule of Capital Expenditures by Segment (Detail) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting, Capital Expenditure Reconciling Item [Line Items] | ||
Capital expenditures for property and equipment | $ 9 | $ 84 |
Capital expenditures for property and equipment of continuing operations | 16 | |
Corporate and other [member] | ||
Segment Reporting, Capital Expenditure Reconciling Item [Line Items] | ||
Capital expenditures for property and equipment | 3 | 3 |
Ownership [member] | ||
Segment Reporting, Capital Expenditure Reconciling Item [Line Items] | ||
Capital expenditures for property and equipment | $ 6 | $ 13 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2017USD ($)Contract | Mar. 31, 2016USD ($) | Dec. 31, 2016USD ($) | |
Commitments and Contingencies [Line Items] | |||
Current liabilities | $ 1,967 | $ 2,684 | |
Guarantees for debt and other obligations of third parties [member] | |||
Commitments and Contingencies [Line Items] | |||
Guarantor obligations, maximum exposure, undiscounted | $ 5 | ||
Guarantor obligations, term | six years | ||
Number of letters of credit pledged as collateral | 1 | ||
Letters of credit outstanding, amount | $ 5 | ||
Management contract performance guarantees [member] | |||
Commitments and Contingencies [Line Items] | |||
Guarantor obligations, maximum exposure, undiscounted | $ 70 | ||
Guarantor obligations, term | 2019 to 2030 | ||
Number of contracts with performance guarantees | Contract | 7 | ||
Current liabilities | $ 12 | 11 | |
Non-current liabilities | $ 15 | $ 17 | |
Number of contracts with performance guarantees with recorded liabilities | Contract | 2 | ||
Loan commitment [member] | |||
Commitments and Contingencies [Line Items] | |||
Long-term purchase commitment, amount | $ 60 | ||
Commitment payments year to date | 8 | $ 8 | |
Other commitments, future minimum payments, remainder of fiscal year | $ 1 |
Condensed Consolidating Guara71
Condensed Consolidating Guarantor Financial Information - Condensed Balance Sheet (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Current Assets: | |||||
Cash and cash equivalents | $ 862 | $ 1,062 | |||
Restricted cash and cash equivalents | 124 | 121 | |||
Accounts receivable, net | 911 | 755 | |||
Intercompany receivables | 0 | 0 | |||
Prepaid expenses | 129 | 89 | |||
Income taxes receivable | 0 | 13 | |||
Other | 43 | 39 | |||
Current assets of discontinued operations | 0 | 1,478 | |||
Total current assets | 2,069 | 3,557 | |||
Intangibles and Other Assets: | |||||
Investments in subsidiaries | 0 | 0 | |||
Goodwill | 5,135 | 5,218 | |||
Brands | [1] | 4,856 | 4,848 | ||
Management and franchise contracts, net | 930 | 963 | |||
Other intangible assets, net | 431 | 447 | |||
Property and equipment, net | 341 | 341 | |||
Deferred income tax assets | 82 | 82 | |||
Other | 443 | 408 | |||
Non-current assets of discontinued operations | 0 | 10,347 | |||
Total intangibles and other assets | 12,218 | 22,654 | |||
Total assets | 14,287 | 26,211 | |||
Current Liabilities: | |||||
Accounts payable, accrued expenses and other | 1,798 | 1,821 | |||
Intercompany payables | 0 | 0 | |||
Current maturities of long-term debt | [2] | 41 | 33 | ||
Income taxes payable | 128 | 56 | |||
Current liabilities of discontinued operations | 0 | 774 | |||
Total current liabilities | 1,967 | 2,684 | |||
Long-term debt | 6,588 | 6,583 | |||
Deferred revenues | 22 | 42 | |||
Deferred income tax liabilities | 1,723 | 1,778 | |||
Liability for guest loyalty program | 898 | 889 | |||
Other | 1,493 | 1,492 | |||
Non-current liabilities of discontinued operations | 0 | 6,894 | |||
Total liabilities | 12,691 | 20,362 | |||
Equity: | |||||
Total Hilton stockholders' equity | 1,598 | 5,899 | |||
Noncontrolling interests | (2) | (50) | |||
Total equity | 1,596 | 5,849 | $ 6,205 | $ 5,951 | |
Total liabilities and equity | 14,287 | 26,211 | |||
Eliminations [Member] | |||||
Current Assets: | |||||
Cash and cash equivalents | 0 | 0 | |||
Restricted cash and cash equivalents | 0 | 0 | |||
Accounts receivable, net | 0 | 0 | |||
Intercompany receivables | (40) | (42) | |||
Prepaid expenses | (1) | (3) | |||
Income taxes receivable | (17) | ||||
Other | 0 | 0 | |||
Current assets of discontinued operations | (24) | ||||
Total current assets | (41) | (86) | |||
Intangibles and Other Assets: | |||||
Investments in subsidiaries | (11,029) | (24,182) | |||
Goodwill | 0 | 0 | |||
Brands | 0 | 0 | |||
Management and franchise contracts, net | 0 | 0 | |||
Other intangible assets, net | 0 | 0 | |||
Property and equipment, net | 0 | 0 | |||
Deferred income tax assets | (14) | (12) | |||
Other | 0 | 0 | |||
Non-current assets of discontinued operations | 0 | ||||
Total intangibles and other assets | (11,043) | (24,194) | |||
Total assets | (11,084) | (24,280) | |||
Current Liabilities: | |||||
Accounts payable, accrued expenses and other | (1) | (3) | |||
Intercompany payables | (40) | (42) | |||
Current maturities of long-term debt | 0 | 0 | |||
Income taxes payable | 0 | (17) | |||
Current liabilities of discontinued operations | (24) | ||||
Total current liabilities | (41) | (86) | |||
Long-term debt | 0 | 0 | |||
Deferred revenues | 0 | 0 | |||
Deferred income tax liabilities | (14) | (12) | |||
Liability for guest loyalty program | 0 | 0 | |||
Other | 0 | 0 | |||
Non-current liabilities of discontinued operations | 0 | ||||
Total liabilities | (55) | (98) | |||
Equity: | |||||
Total Hilton stockholders' equity | (11,029) | (24,182) | |||
Noncontrolling interests | 0 | 0 | |||
Total equity | (11,029) | (24,182) | |||
Total liabilities and equity | (11,084) | (24,280) | |||
Parent [Member] | |||||
Current Assets: | |||||
Cash and cash equivalents | 0 | 0 | |||
Restricted cash and cash equivalents | 0 | 0 | |||
Accounts receivable, net | 0 | 0 | |||
Intercompany receivables | 0 | 0 | |||
Prepaid expenses | 0 | 0 | |||
Income taxes receivable | 0 | ||||
Other | 0 | 0 | |||
Current assets of discontinued operations | 0 | ||||
Total current assets | 0 | 0 | |||
Intangibles and Other Assets: | |||||
Investments in subsidiaries | 1,588 | 5,889 | |||
Goodwill | 0 | 0 | |||
Brands | 0 | 0 | |||
Management and franchise contracts, net | 0 | 0 | |||
Other intangible assets, net | 0 | 0 | |||
Property and equipment, net | 0 | 0 | |||
Deferred income tax assets | 10 | 10 | |||
Other | 0 | 0 | |||
Non-current assets of discontinued operations | 0 | ||||
Total intangibles and other assets | 1,598 | 5,899 | |||
Total assets | 1,598 | 5,899 | |||
Current Liabilities: | |||||
Accounts payable, accrued expenses and other | 0 | 0 | |||
Intercompany payables | 0 | 0 | |||
Current maturities of long-term debt | 0 | 0 | |||
Income taxes payable | 0 | 0 | |||
Current liabilities of discontinued operations | 0 | ||||
Total current liabilities | 0 | 0 | |||
Long-term debt | 0 | 0 | |||
Deferred revenues | 0 | 0 | |||
Deferred income tax liabilities | 0 | 0 | |||
Liability for guest loyalty program | 0 | 0 | |||
Other | 0 | 0 | |||
Non-current liabilities of discontinued operations | 0 | ||||
Total liabilities | 0 | 0 | |||
Equity: | |||||
Total Hilton stockholders' equity | 1,598 | 5,899 | |||
Noncontrolling interests | 0 | 0 | |||
Total equity | 1,598 | 5,899 | |||
Total liabilities and equity | 1,598 | 5,899 | |||
Subsidiary Issuer [Member] | |||||
Current Assets: | |||||
Cash and cash equivalents | 0 | 0 | |||
Restricted cash and cash equivalents | 0 | 0 | |||
Accounts receivable, net | 0 | 0 | |||
Intercompany receivables | 0 | 0 | |||
Prepaid expenses | 0 | 0 | |||
Income taxes receivable | 0 | ||||
Other | 0 | 0 | |||
Current assets of discontinued operations | 0 | ||||
Total current assets | 0 | 0 | |||
Intangibles and Other Assets: | |||||
Investments in subsidiaries | 6,975 | 11,300 | |||
Goodwill | 0 | 0 | |||
Brands | 0 | 0 | |||
Management and franchise contracts, net | 0 | 0 | |||
Other intangible assets, net | 0 | 0 | |||
Property and equipment, net | 0 | 0 | |||
Deferred income tax assets | 4 | 2 | |||
Other | 11 | 12 | |||
Non-current assets of discontinued operations | 0 | ||||
Total intangibles and other assets | 6,990 | 11,314 | |||
Total assets | 6,990 | 11,314 | |||
Current Liabilities: | |||||
Accounts payable, accrued expenses and other | 6 | 26 | |||
Intercompany payables | 0 | 0 | |||
Current maturities of long-term debt | 32 | 26 | |||
Income taxes payable | 0 | 0 | |||
Current liabilities of discontinued operations | 0 | ||||
Total current liabilities | 38 | 52 | |||
Long-term debt | 5,357 | 5,361 | |||
Deferred revenues | 0 | 0 | |||
Deferred income tax liabilities | 0 | 0 | |||
Liability for guest loyalty program | 0 | 0 | |||
Other | 7 | 12 | |||
Non-current liabilities of discontinued operations | 0 | ||||
Total liabilities | 5,402 | 5,425 | |||
Equity: | |||||
Total Hilton stockholders' equity | 1,588 | 5,889 | |||
Noncontrolling interests | 0 | 0 | |||
Total equity | 1,588 | 5,889 | |||
Total liabilities and equity | 6,990 | 11,314 | |||
Guarantor Subsidiaries [Member] | |||||
Current Assets: | |||||
Cash and cash equivalents | 14 | 25 | |||
Restricted cash and cash equivalents | 97 | 96 | |||
Accounts receivable, net | 655 | 491 | |||
Intercompany receivables | 0 | 0 | |||
Prepaid expenses | 56 | 27 | |||
Income taxes receivable | 30 | ||||
Other | 6 | 6 | |||
Current assets of discontinued operations | 0 | ||||
Total current assets | 828 | 675 | |||
Intangibles and Other Assets: | |||||
Investments in subsidiaries | 2,466 | 6,993 | |||
Goodwill | 3,824 | 3,824 | |||
Brands | 4,405 | 4,404 | |||
Management and franchise contracts, net | 683 | 716 | |||
Other intangible assets, net | 283 | 297 | |||
Property and equipment, net | 72 | 74 | |||
Deferred income tax assets | 0 | 0 | |||
Other | 266 | 243 | |||
Non-current assets of discontinued operations | 2 | ||||
Total intangibles and other assets | 11,999 | 16,553 | |||
Total assets | 12,827 | 17,228 | |||
Current Liabilities: | |||||
Accounts payable, accrued expenses and other | 1,371 | 1,384 | |||
Intercompany payables | 40 | 42 | |||
Current maturities of long-term debt | 0 | 0 | |||
Income taxes payable | 49 | 0 | |||
Current liabilities of discontinued operations | 77 | ||||
Total current liabilities | 1,460 | 1,503 | |||
Long-term debt | 982 | 981 | |||
Deferred revenues | 22 | 42 | |||
Deferred income tax liabilities | 1,710 | 1,752 | |||
Liability for guest loyalty program | 898 | 889 | |||
Other | 780 | 767 | |||
Non-current liabilities of discontinued operations | (6) | ||||
Total liabilities | 5,852 | 5,928 | |||
Equity: | |||||
Total Hilton stockholders' equity | 6,975 | 11,300 | |||
Noncontrolling interests | 0 | 0 | |||
Total equity | 6,975 | 11,300 | |||
Total liabilities and equity | 12,827 | 17,228 | |||
Non-Guarantor Subsidiaries [Member] | |||||
Current Assets: | |||||
Cash and cash equivalents | 848 | 1,037 | |||
Restricted cash and cash equivalents | 27 | 25 | |||
Accounts receivable, net | 256 | 264 | |||
Intercompany receivables | 40 | 42 | |||
Prepaid expenses | 74 | 65 | |||
Income taxes receivable | 0 | ||||
Other | 37 | 33 | |||
Current assets of discontinued operations | 1,502 | ||||
Total current assets | 1,282 | 2,968 | |||
Intangibles and Other Assets: | |||||
Investments in subsidiaries | 0 | 0 | |||
Goodwill | 1,311 | 1,394 | |||
Brands | 451 | 444 | |||
Management and franchise contracts, net | 247 | 247 | |||
Other intangible assets, net | 148 | 150 | |||
Property and equipment, net | 269 | 267 | |||
Deferred income tax assets | 82 | 82 | |||
Other | 166 | 153 | |||
Non-current assets of discontinued operations | 10,345 | ||||
Total intangibles and other assets | 2,674 | 13,082 | |||
Total assets | 3,956 | 16,050 | |||
Current Liabilities: | |||||
Accounts payable, accrued expenses and other | 422 | 414 | |||
Intercompany payables | 0 | 0 | |||
Current maturities of long-term debt | 9 | 7 | |||
Income taxes payable | 79 | 73 | |||
Current liabilities of discontinued operations | 721 | ||||
Total current liabilities | 510 | 1,215 | |||
Long-term debt | 249 | 241 | |||
Deferred revenues | 0 | 0 | |||
Deferred income tax liabilities | 27 | 38 | |||
Liability for guest loyalty program | 0 | 0 | |||
Other | 706 | 713 | |||
Non-current liabilities of discontinued operations | 6,900 | ||||
Total liabilities | 1,492 | 9,107 | |||
Equity: | |||||
Total Hilton stockholders' equity | 2,466 | 6,993 | |||
Noncontrolling interests | (2) | (50) | |||
Total equity | 2,464 | 6,943 | |||
Total liabilities and equity | $ 3,956 | $ 16,050 | |||
[1] | Represents intangible assets that were initially recorded at their fair value as part of the October 24, 2007 transaction whereby we became a wholly owned subsidiary of an affiliate of Blackstone (the "Merger"). | ||||
[2] | Net of unamortized deferred financing costs and discount attributable to current maturities of long-term debt. |
Condensed Consolidating Guara72
Condensed Consolidating Guarantor Financial Information - Condensed Income Statement (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Revenues | ||
Franchise fees | $ 294 | $ 253 |
Base and other management fees | 83 | 60 |
Incentive management fees | 52 | 36 |
Owned and leased hotels | 300 | 319 |
Other revenues | 37 | 17 |
Total revenues excluding reimbursement revenue | 766 | 685 |
Other revenues from managed and franchised properties | 1,395 | 1,041 |
Total revenues | 2,161 | 1,726 |
Expenses | ||
Owned and leased hotels | 272 | 307 |
Depreciation and amortization | 89 | 92 |
Impairment loss | 0 | 15 |
General and administrative | 105 | 83 |
Other expenses | 23 | 18 |
Total expenses excluding cost of reimbursable expense | 489 | 515 |
Other expenses from managed and franchised properties | 1,395 | 1,041 |
Total expenses | 1,884 | 1,556 |
Operating income | 277 | 170 |
Interest expense | (104) | (90) |
Gain (loss) on foreign currency transactions | (4) | (12) |
Loss on debt extinguishment | (60) | 0 |
Other non-operating income (loss), net | 1 | 2 |
Income from continuing operations before income taxes | 110 | 70 |
Income tax benefit (expense) | (35) | 121 |
Income (loss) from continuing operations before income from subsidiaries, net of taxes | 75 | 191 |
Equity in earnings from subsidiaries | 0 | 0 |
Income (losses) from continuing operations, net of taxes | 75 | 191 |
Income from discontinued operations, net of taxes | 0 | 119 |
Net income | 75 | 310 |
Net income attributable to noncontrolling interests | (1) | (1) |
Net income attributable to Hilton stockholders | 74 | 309 |
Comprehensive income | 94 | 318 |
Comprehensive loss attributable to noncontrolling interests | 0 | 1 |
Comprehensive income attributable to Hilton stockholders | 94 | 319 |
Eliminations [Member] | ||
Revenues | ||
Franchise fees | (4) | (3) |
Base and other management fees | 0 | 0 |
Incentive management fees | 0 | 0 |
Owned and leased hotels | 0 | 0 |
Other revenues | 0 | 0 |
Total revenues excluding reimbursement revenue | (4) | (3) |
Other revenues from managed and franchised properties | 0 | 0 |
Total revenues | (4) | (3) |
Expenses | ||
Owned and leased hotels | 0 | 0 |
Depreciation and amortization | 0 | 0 |
Impairment loss | 0 | |
General and administrative | 0 | 0 |
Other expenses | (4) | (3) |
Total expenses excluding cost of reimbursable expense | (4) | (3) |
Other expenses from managed and franchised properties | 0 | 0 |
Total expenses | (4) | (3) |
Operating income | 0 | 0 |
Interest expense | 0 | 0 |
Gain (loss) on foreign currency transactions | 0 | 0 |
Loss on debt extinguishment | 0 | |
Other non-operating income (loss), net | 0 | 0 |
Income from continuing operations before income taxes | 0 | 0 |
Income tax benefit (expense) | 0 | 0 |
Income (loss) from continuing operations before income from subsidiaries, net of taxes | 0 | 0 |
Equity in earnings from subsidiaries | (237) | (32) |
Income (losses) from continuing operations, net of taxes | (32) | |
Income from discontinued operations, net of taxes | (338) | |
Net income | (237) | (370) |
Net income attributable to noncontrolling interests | 0 | 0 |
Net income attributable to Hilton stockholders | (237) | (370) |
Comprehensive income | (257) | (380) |
Comprehensive loss attributable to noncontrolling interests | 0 | 0 |
Comprehensive income attributable to Hilton stockholders | (257) | (380) |
Parent [Member] | ||
Revenues | ||
Franchise fees | 0 | 0 |
Base and other management fees | 0 | 0 |
Incentive management fees | 0 | 0 |
Owned and leased hotels | 0 | 0 |
Other revenues | 0 | 0 |
Total revenues excluding reimbursement revenue | 0 | 0 |
Other revenues from managed and franchised properties | 0 | 0 |
Total revenues | 0 | 0 |
Expenses | ||
Owned and leased hotels | 0 | 0 |
Depreciation and amortization | 0 | 0 |
Impairment loss | 0 | |
General and administrative | 0 | 0 |
Other expenses | 0 | 0 |
Total expenses excluding cost of reimbursable expense | 0 | 0 |
Other expenses from managed and franchised properties | 0 | 0 |
Total expenses | 0 | 0 |
Operating income | 0 | 0 |
Interest expense | 0 | 0 |
Gain (loss) on foreign currency transactions | 0 | 0 |
Loss on debt extinguishment | 0 | |
Other non-operating income (loss), net | 0 | 0 |
Income from continuing operations before income taxes | 0 | 0 |
Income tax benefit (expense) | 0 | 192 |
Income (loss) from continuing operations before income from subsidiaries, net of taxes | 0 | 192 |
Equity in earnings from subsidiaries | 74 | 0 |
Income (losses) from continuing operations, net of taxes | 192 | |
Income from discontinued operations, net of taxes | 117 | |
Net income | 74 | 309 |
Net income attributable to noncontrolling interests | 0 | 0 |
Net income attributable to Hilton stockholders | 74 | 309 |
Comprehensive income | 94 | 319 |
Comprehensive loss attributable to noncontrolling interests | 0 | 0 |
Comprehensive income attributable to Hilton stockholders | 94 | 319 |
Subsidiary Issuer [Member] | ||
Revenues | ||
Franchise fees | 0 | 0 |
Base and other management fees | 0 | 0 |
Incentive management fees | 0 | 0 |
Owned and leased hotels | 0 | 0 |
Other revenues | 0 | 0 |
Total revenues excluding reimbursement revenue | 0 | 0 |
Other revenues from managed and franchised properties | 0 | 0 |
Total revenues | 0 | 0 |
Expenses | ||
Owned and leased hotels | 0 | 0 |
Depreciation and amortization | 0 | 0 |
Impairment loss | 0 | |
General and administrative | 0 | 0 |
Other expenses | 0 | 0 |
Total expenses excluding cost of reimbursable expense | 0 | 0 |
Other expenses from managed and franchised properties | 0 | 0 |
Total expenses | 0 | 0 |
Operating income | 0 | 0 |
Interest expense | (63) | (67) |
Gain (loss) on foreign currency transactions | 0 | 0 |
Loss on debt extinguishment | (60) | |
Other non-operating income (loss), net | (3) | 0 |
Income from continuing operations before income taxes | (126) | (67) |
Income tax benefit (expense) | 49 | 26 |
Income (loss) from continuing operations before income from subsidiaries, net of taxes | (77) | (41) |
Equity in earnings from subsidiaries | 151 | 41 |
Income (losses) from continuing operations, net of taxes | 0 | |
Income from discontinued operations, net of taxes | 117 | |
Net income | 74 | 117 |
Net income attributable to noncontrolling interests | 0 | 0 |
Net income attributable to Hilton stockholders | 74 | 117 |
Comprehensive income | 72 | 111 |
Comprehensive loss attributable to noncontrolling interests | 0 | 0 |
Comprehensive income attributable to Hilton stockholders | 72 | 111 |
Guarantor Subsidiaries [Member] | ||
Revenues | ||
Franchise fees | 274 | 234 |
Base and other management fees | 50 | 32 |
Incentive management fees | 22 | 8 |
Owned and leased hotels | 0 | 0 |
Other revenues | 33 | 14 |
Total revenues excluding reimbursement revenue | 379 | 288 |
Other revenues from managed and franchised properties | 1,265 | 924 |
Total revenues | 1,644 | 1,212 |
Expenses | ||
Owned and leased hotels | 0 | 0 |
Depreciation and amortization | 65 | 68 |
Impairment loss | 0 | |
General and administrative | 81 | 57 |
Other expenses | 19 | 9 |
Total expenses excluding cost of reimbursable expense | 165 | 134 |
Other expenses from managed and franchised properties | 1,265 | 924 |
Total expenses | 1,430 | 1,058 |
Operating income | 214 | 154 |
Interest expense | (28) | (11) |
Gain (loss) on foreign currency transactions | 32 | 5 |
Loss on debt extinguishment | 0 | |
Other non-operating income (loss), net | 2 | 2 |
Income from continuing operations before income taxes | 220 | 150 |
Income tax benefit (expense) | (81) | (100) |
Income (loss) from continuing operations before income from subsidiaries, net of taxes | 139 | 50 |
Equity in earnings from subsidiaries | 12 | (9) |
Income (losses) from continuing operations, net of taxes | 41 | |
Income from discontinued operations, net of taxes | 117 | |
Net income | 151 | 158 |
Net income attributable to noncontrolling interests | 0 | 0 |
Net income attributable to Hilton stockholders | 151 | 158 |
Comprehensive income | 155 | 149 |
Comprehensive loss attributable to noncontrolling interests | 0 | 0 |
Comprehensive income attributable to Hilton stockholders | 155 | 149 |
Non-Guarantor Subsidiaries [Member] | ||
Revenues | ||
Franchise fees | 24 | 22 |
Base and other management fees | 33 | 28 |
Incentive management fees | 30 | 28 |
Owned and leased hotels | 300 | 319 |
Other revenues | 4 | 3 |
Total revenues excluding reimbursement revenue | 391 | 400 |
Other revenues from managed and franchised properties | 130 | 117 |
Total revenues | 521 | 517 |
Expenses | ||
Owned and leased hotels | 272 | 307 |
Depreciation and amortization | 24 | 24 |
Impairment loss | 15 | |
General and administrative | 24 | 26 |
Other expenses | 8 | 12 |
Total expenses excluding cost of reimbursable expense | 328 | 384 |
Other expenses from managed and franchised properties | 130 | 117 |
Total expenses | 458 | 501 |
Operating income | 63 | 16 |
Interest expense | (13) | (12) |
Gain (loss) on foreign currency transactions | (36) | (17) |
Loss on debt extinguishment | 0 | |
Other non-operating income (loss), net | 2 | 0 |
Income from continuing operations before income taxes | 16 | (13) |
Income tax benefit (expense) | (3) | 3 |
Income (loss) from continuing operations before income from subsidiaries, net of taxes | 13 | (10) |
Equity in earnings from subsidiaries | 0 | 0 |
Income (losses) from continuing operations, net of taxes | (10) | |
Income from discontinued operations, net of taxes | 106 | |
Net income | 13 | 96 |
Net income attributable to noncontrolling interests | (1) | (1) |
Net income attributable to Hilton stockholders | 12 | 95 |
Comprehensive income | 30 | 119 |
Comprehensive loss attributable to noncontrolling interests | 0 | 1 |
Comprehensive income attributable to Hilton stockholders | $ 30 | $ 120 |
Condensed Consolidating Guara73
Condensed Consolidating Guarantor Financial Information - Condensed Cash Flow Statement (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
Operating Activities: | ||
Net cash provided by (used in) operating activities | $ 63 | $ 339 |
Investing Activities: | ||
Capital expenditures for property and equipment | (9) | (84) |
Contract acquisition costs | (13) | (9) |
Capitalized software costs | (9) | (11) |
Other | (19) | (6) |
Net cash used in investing activities | (50) | (110) |
Financing Activities: | ||
Borrowings | 1,823 | 0 |
Repayment of debt | (1,824) | (32) |
Debt issuance costs and redemption premium | (66) | 0 |
Repayment of intercompany borrowings | 0 | |
Intercompany transfers | 0 | 0 |
Dividends paid | (49) | (69) |
Cash transferred in spin-offs of Park and HGV | (501) | 0 |
Repurchases of common stock | (70) | 0 |
Distributions to noncontrolling interests | (1) | (2) |
Tax withholdings on share-based compensation | (28) | (13) |
Net cash used in financing activities | (716) | (116) |
Effect of exchange rate changes on cash, restricted cash and cash equivalents | 5 | 4 |
Net increase (decrease) in cash, restricted cash and cash equivalents | (698) | 117 |
Cash, restricted cash and cash equivalents from continuing operations, beginning of period | 1,183 | 634 |
Cash, restricted cash and cash equivalents from continuing operations, end of period | 986 | 682 |
Cash, restricted cash and cash equivalents from discontinued operations, beginning of period | 501 | 222 |
Cash, restricted cash and cash equivalents from discontinued operations, end of period | 0 | 291 |
Cash, restricted cash and cash equivalents, beginning of period | 1,684 | 856 |
Cash, restricted cash and cash equivalents, end of period | 986 | 973 |
Eliminations [Member] | ||
Operating Activities: | ||
Net cash provided by (used in) operating activities | (3) | 0 |
Investing Activities: | ||
Capital expenditures for property and equipment | 0 | 0 |
Contract acquisition costs | 0 | 0 |
Capitalized software costs | 0 | 0 |
Other | 0 | 0 |
Net cash used in investing activities | 0 | 0 |
Financing Activities: | ||
Borrowings | 0 | |
Repayment of debt | 0 | 0 |
Debt issuance costs and redemption premium | 0 | |
Repayment of intercompany borrowings | 3 | |
Intercompany transfers | 0 | 0 |
Dividends paid | 0 | 0 |
Cash transferred in spin-offs of Park and HGV | 0 | |
Repurchases of common stock | 0 | |
Distributions to noncontrolling interests | 0 | 0 |
Tax withholdings on share-based compensation | 0 | 0 |
Net cash used in financing activities | 3 | 0 |
Effect of exchange rate changes on cash, restricted cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash, restricted cash and cash equivalents | 0 | 0 |
Cash, restricted cash and cash equivalents from continuing operations, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents from continuing operations, end of period | 0 | |
Cash, restricted cash and cash equivalents from discontinued operations, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents from discontinued operations, end of period | 0 | |
Cash, restricted cash and cash equivalents, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents, end of period | 0 | 0 |
Parent [Member] | ||
Operating Activities: | ||
Net cash provided by (used in) operating activities | 0 | 0 |
Investing Activities: | ||
Capital expenditures for property and equipment | 0 | 0 |
Contract acquisition costs | 0 | 0 |
Capitalized software costs | 0 | 0 |
Other | 0 | 0 |
Net cash used in investing activities | 0 | 0 |
Financing Activities: | ||
Borrowings | 0 | |
Repayment of debt | 0 | 0 |
Debt issuance costs and redemption premium | 0 | |
Repayment of intercompany borrowings | 0 | |
Intercompany transfers | 119 | 69 |
Dividends paid | (49) | (69) |
Cash transferred in spin-offs of Park and HGV | 0 | |
Repurchases of common stock | (70) | |
Distributions to noncontrolling interests | 0 | 0 |
Tax withholdings on share-based compensation | 0 | 0 |
Net cash used in financing activities | 0 | 0 |
Effect of exchange rate changes on cash, restricted cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash, restricted cash and cash equivalents | 0 | 0 |
Cash, restricted cash and cash equivalents from continuing operations, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents from continuing operations, end of period | 0 | |
Cash, restricted cash and cash equivalents from discontinued operations, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents from discontinued operations, end of period | 0 | |
Cash, restricted cash and cash equivalents, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents, end of period | 0 | 0 |
Subsidiary Issuer [Member] | ||
Operating Activities: | ||
Net cash provided by (used in) operating activities | 0 | 0 |
Investing Activities: | ||
Capital expenditures for property and equipment | 0 | 0 |
Contract acquisition costs | 0 | 0 |
Capitalized software costs | 0 | 0 |
Other | (13) | 0 |
Net cash used in investing activities | (13) | 0 |
Financing Activities: | ||
Borrowings | 1,823 | |
Repayment of debt | (1,823) | 0 |
Debt issuance costs and redemption premium | (66) | |
Repayment of intercompany borrowings | 0 | |
Intercompany transfers | 79 | 0 |
Dividends paid | 0 | 0 |
Cash transferred in spin-offs of Park and HGV | 0 | |
Repurchases of common stock | 0 | |
Distributions to noncontrolling interests | 0 | 0 |
Tax withholdings on share-based compensation | 0 | 0 |
Net cash used in financing activities | 13 | 0 |
Effect of exchange rate changes on cash, restricted cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash, restricted cash and cash equivalents | 0 | 0 |
Cash, restricted cash and cash equivalents from continuing operations, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents from continuing operations, end of period | 0 | |
Cash, restricted cash and cash equivalents from discontinued operations, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents from discontinued operations, end of period | 0 | |
Cash, restricted cash and cash equivalents, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents, end of period | 0 | 0 |
Guarantor Subsidiaries [Member] | ||
Operating Activities: | ||
Net cash provided by (used in) operating activities | (46) | (279) |
Investing Activities: | ||
Capital expenditures for property and equipment | (1) | 0 |
Contract acquisition costs | (8) | (8) |
Capitalized software costs | (9) | (10) |
Other | (6) | (9) |
Net cash used in investing activities | (24) | (27) |
Financing Activities: | ||
Borrowings | 0 | |
Repayment of debt | 0 | 0 |
Debt issuance costs and redemption premium | 0 | |
Repayment of intercompany borrowings | (3) | |
Intercompany transfers | 91 | 317 |
Dividends paid | 0 | 0 |
Cash transferred in spin-offs of Park and HGV | 0 | |
Repurchases of common stock | 0 | |
Distributions to noncontrolling interests | 0 | 0 |
Tax withholdings on share-based compensation | (28) | (13) |
Net cash used in financing activities | 60 | 304 |
Effect of exchange rate changes on cash, restricted cash and cash equivalents | 0 | 0 |
Net increase (decrease) in cash, restricted cash and cash equivalents | (10) | (2) |
Cash, restricted cash and cash equivalents from continuing operations, beginning of period | 121 | 108 |
Cash, restricted cash and cash equivalents from continuing operations, end of period | 106 | |
Cash, restricted cash and cash equivalents from discontinued operations, beginning of period | 0 | 0 |
Cash, restricted cash and cash equivalents from discontinued operations, end of period | 0 | |
Cash, restricted cash and cash equivalents, beginning of period | 121 | 108 |
Cash, restricted cash and cash equivalents, end of period | 111 | 106 |
Non-Guarantor Subsidiaries [Member] | ||
Operating Activities: | ||
Net cash provided by (used in) operating activities | 112 | 618 |
Investing Activities: | ||
Capital expenditures for property and equipment | (8) | (84) |
Contract acquisition costs | (5) | (1) |
Capitalized software costs | 0 | (1) |
Other | 0 | 3 |
Net cash used in investing activities | (13) | (83) |
Financing Activities: | ||
Borrowings | 0 | |
Repayment of debt | (1) | (32) |
Debt issuance costs and redemption premium | 0 | |
Repayment of intercompany borrowings | 0 | |
Intercompany transfers | (289) | (386) |
Dividends paid | 0 | 0 |
Cash transferred in spin-offs of Park and HGV | (501) | |
Repurchases of common stock | 0 | |
Distributions to noncontrolling interests | (1) | (2) |
Tax withholdings on share-based compensation | 0 | 0 |
Net cash used in financing activities | (792) | (420) |
Effect of exchange rate changes on cash, restricted cash and cash equivalents | 5 | 4 |
Net increase (decrease) in cash, restricted cash and cash equivalents | (688) | 119 |
Cash, restricted cash and cash equivalents from continuing operations, beginning of period | 1,062 | 526 |
Cash, restricted cash and cash equivalents from continuing operations, end of period | 576 | |
Cash, restricted cash and cash equivalents from discontinued operations, beginning of period | 501 | 222 |
Cash, restricted cash and cash equivalents from discontinued operations, end of period | 291 | |
Cash, restricted cash and cash equivalents, beginning of period | 1,563 | 748 |
Cash, restricted cash and cash equivalents, end of period | $ 875 | $ 867 |
Condensed Consolidating Guara74
Condensed Consolidating Guarantor Financial Information - Additional Information (Details) | Mar. 31, 2017Rate | Dec. 31, 2016Rate |
Subsidiary Issuer [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Ownership percentage of equity interest | 100.00% | 100.00% |
Guarantor Subsidiaries [Member] | ||
Condensed Financial Statements, Captions [Line Items] | ||
Ownership percentage of equity interest | 100.00% | 100.00% |