|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
September 30, 2013 | December 31, 2012 | ||||||
Equity method investments | $ | 402 | $ | 212 | |||
Cost method investments | 71 | 71 | |||||
Total investments | $ | 473 | $ | 283 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Total revenues | $ | 246 | $ | 268 | $ | 721 | $ | 762 | |||||||
Gross operating profit | 78 | 93 | 236 | 246 | |||||||||||
Income from continuing operations | 28 | 11 | 24 | 14 | |||||||||||
Net income | 28 | 11 | 24 | 14 |
|
September 30, 2013 | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | ||||||||||||
Marketable securities recorded in cash and cash equivalents | |||||||||||||||
Interest bearing money market funds | $ | 67 | $ | 67 | $ | — | $ | — | |||||||
Marketable securities included in short-term investments, prepaids and other assets, and other assets | |||||||||||||||
Mutual funds | 314 | 314 | — | — | |||||||||||
Equity securities | 8 | 8 | — | — | |||||||||||
U.S. government obligations | 120 | — | 120 | — | |||||||||||
U.S. government agencies | 48 | — | 48 | — | |||||||||||
Corporate debt securities | 109 | — | 109 | — | |||||||||||
Mortgage-backed securities | 20 | — | 20 | — | |||||||||||
Asset-backed securities | 17 | — | 17 | — | |||||||||||
Municipal and provincial notes and bonds | 3 | — | 3 | — | |||||||||||
Preferred shares | 225 | — | — | 225 | |||||||||||
Derivative instruments | |||||||||||||||
Foreign currency forward contracts | (7 | ) | — | (7 | ) | — |
December 31, 2012 | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | ||||||||||||
Marketable securities recorded in cash and cash equivalents | |||||||||||||||
Interest bearing money market funds | $ | 117 | $ | 117 | $ | — | $ | — | |||||||
Marketable securities included in short-term investments, prepaids and other assets, and other assets | |||||||||||||||
Mutual funds | 275 | 275 | — | — | |||||||||||
Equity securities | 10 | 10 | — | — | |||||||||||
U.S. government obligations | 111 | — | 111 | — | |||||||||||
U.S. government agencies | 68 | — | 68 | — | |||||||||||
Corporate debt securities | 540 | — | 540 | — | |||||||||||
Mortgage-backed securities | 22 | — | 22 | — | |||||||||||
Asset-backed securities | 10 | — | 10 | — | |||||||||||
Municipal and provincial notes and bonds | 15 | — | 15 | — | |||||||||||
Derivative instruments | |||||||||||||||
Interest rate swaps | 1 | — | 1 | — | |||||||||||
Foreign currency forward contracts | (1 | ) | — | (1 | ) | — |
September 30, 2013 | |||||||||||||||
Cost or Amortized Cost | Gross Unrealized Gain | Gross Unrealized Loss | Fair Value | ||||||||||||
Equity securities | $ | 7 | $ | 1 | $ | — | $ | 8 | |||||||
Preferred shares | 225 | — | — | 225 | |||||||||||
Total | $ | 232 | $ | 1 | $ | — | $ | 233 |
December 31, 2012 | |||||||||||||||
Cost or Amortized Cost | Gross Unrealized Gain | Gross Unrealized Loss | Fair Value | ||||||||||||
Corporate debt securities | $ | 443 | $ | 8 | $ | (8 | ) | $ | 443 | ||||||
U.S. government agencies and municipalities | 31 | — | — | 31 | |||||||||||
Equity securities | 9 | 1 | — | 10 | |||||||||||
Total | $ | 483 | $ | 9 | $ | (8 | ) | $ | 484 |
Asset (Liability) | |||||||||||||||||||
September 30, 2013 | |||||||||||||||||||
Carrying Value | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | |||||||||||||||
Financing receivables | |||||||||||||||||||
Secured financing to hotel owners | $ | 32 | $ | 38 | $ | — | $ | — | $ | 38 | |||||||||
Vacation ownership mortgage receivable | 37 | 38 | — | — | 38 | ||||||||||||||
Unsecured financing to hotel owners | 64 | 63 | — | — | 63 | ||||||||||||||
Debt, excluding capital lease obligations | (1,097 | ) | (1,147 | ) | — | (1,093 | ) | (54 | ) |
Asset (Liability) | |||||||||||||||||||
December 31, 2012 | |||||||||||||||||||
Carrying Value | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | |||||||||||||||
Financing receivables | |||||||||||||||||||
Secured financing to hotel owners | $ | 310 | $ | 314 | $ | — | $ | — | $ | 314 | |||||||||
Vacation ownership mortgage receivable | 39 | 39 | — | — | 39 | ||||||||||||||
Unsecured financing to hotel owners | 64 | 64 | — | — | 64 | ||||||||||||||
Debt, excluding capital lease obligations | (1,017 | ) | (1,137 | ) | — | (1,126 | ) | (11 | ) |
|
• | Secured Financing to Hotel Owners—These financing receivables are senior secured mortgage loans and are collateralized by hotel properties currently in operation. These loans at September 30, 2013 and December 31, 2012 include financing provided to certain franchisees for the renovation and conversion of certain franchised hotels. These franchisee loans accrue interest at fixed rates ranging between 5.0% and 5.5%. Secured financing to hotel owners at December 31, 2012 consisted primarily of a $277 million mortgage loan receivable to an unconsolidated hospitality venture which was formed to acquire ownership of a hotel property in Waikiki, Hawaii. This mortgage receivable had interest set at 30-day LIBOR +3.75% due monthly and a stated maturity date of July 2013. This receivable was repaid in full, including payment of all accrued, but unpaid interest in the third quarter of 2013. |
• | Vacation Ownership Mortgage Receivables—These financing receivables are comprised of various mortgage loans related to our financing of vacation ownership interval sales. As of September 30, 2013, the weighted-average interest rate on vacation ownership mortgage receivables was 14.0%. |
• | Unsecured Financing to Hotel Owners—These financing receivables are primarily made up of individual unsecured loans and other types of financing arrangements provided to hotel owners. During 2012, we entered into a loan agreement to provide a $50 million mezzanine loan for the construction of a hotel that we will manage. Under the loan agreement, interest accrues at the greater of one-month LIBOR plus 5.0%, or 6.5%. Our other financing receivables have stated maturities and interest rates. However, the expected repayment terms may be dependent on the future cash flows of the hotels and these instruments, therefore, are not considered loans as the repayment dates are not fixed or determinable. Because these arrangements are not considered loans, we do not include them in our impaired loans analysis. Since these receivables may come due earlier than the stated maturity date, the expected maturity dates have been excluded from the maturities table below. |
September 30, 2013 | December 31, 2012 | ||||||
Secured financing to hotel owners | $ | 39 | $ | 317 | |||
Vacation ownership mortgage receivables at various interest rates with varying payments through 2023 | 45 | 48 | |||||
Unsecured financing to hotel owners | 147 | 147 | |||||
231 | 512 | ||||||
Less allowance for losses | (98 | ) | (99 | ) | |||
Less current portion included in receivables, net | (8 | ) | (287 | ) | |||
Total long-term financing receivables, net | $ | 125 | $ | 126 |
Year Ending December 31, | Secured Financing to Hotel Owners | Vacation Ownership Mortgage Receivables | |||||
2013 | $ | — | $ | 2 | |||
2014 | 1 | 7 | |||||
2015 | 38 | 7 | |||||
2016 | — | 7 | |||||
2017 | — | 5 | |||||
2018 | — | 4 | |||||
Thereafter | — | 13 | |||||
Total | 39 | 45 | |||||
Less allowance | (7 | ) | (8 | ) | |||
Net financing receivables | $ | 32 | $ | 37 |
Secured Financing | Vacation Ownership | Unsecured Financing | Total | ||||||||||||
Allowance at January 1, 2013 | $ | 7 | $ | 9 | $ | 83 | $ | 99 | |||||||
Provisions | — | — | 2 | 2 | |||||||||||
Write-offs | — | (2 | ) | (2 | ) | (4 | ) | ||||||||
Recoveries | — | — | — | — | |||||||||||
Other Adjustments | — | — | (1 | ) | (1 | ) | |||||||||
Allowance at June 30, 2013 | $ | 7 | $ | 7 | $ | 82 | $ | 96 | |||||||
Provisions | — | 1 | 1 | 2 | |||||||||||
Write-offs | — | — | — | — | |||||||||||
Recoveries | — | — | — | — | |||||||||||
Other Adjustments | — | — | — | — | |||||||||||
Allowance at September 30, 2013 | $ | 7 | $ | 8 | $ | 83 | $ | 98 |
Secured Financing | Vacation Ownership | Unsecured Financing | Total | ||||||||||||
Allowance at January 1, 2012 | $ | 7 | $ | 8 | $ | 75 | $ | 90 | |||||||
Provisions | — | 3 | 6 | 9 | |||||||||||
Write-offs | — | (3 | ) | (3 | ) | (6 | ) | ||||||||
Recoveries | — | — | (2 | ) | (2 | ) | |||||||||
Other Adjustments | — | — | — | — | |||||||||||
Allowance at June 30, 2012 | $ | 7 | $ | 8 | $ | 76 | $ | 91 | |||||||
Provisions | — | 1 | 2 | 3 | |||||||||||
Write-offs | — | (1 | ) | — | (1 | ) | |||||||||
Recoveries | — | — | — | — | |||||||||||
Other Adjustments | — | — | — | — | |||||||||||
Allowance at September 30, 2012 | $ | 7 | $ | 8 | $ | 78 | $ | 93 |
Impaired Loans | |||||||||||||||
September 30, 2013 | |||||||||||||||
Gross Loan Balance (Principal and Interest) | Unpaid Principal Balance | Related Allowance | Average Recorded Loan Balance | ||||||||||||
Secured financing to hotel owners | $ | 40 | $ | 39 | $ | (7 | ) | $ | 40 | ||||||
Unsecured financing to hotel owners | 53 | 39 | (53 | ) | 54 |
Impaired Loans | |||||||||||||||
December 31, 2012 | |||||||||||||||
Gross Loan Balance (Principal and Interest) | Unpaid Principal Balance | Related Allowance | Average Recorded Loan Balance | ||||||||||||
Secured financing to hotel owners | $ | 40 | $ | 39 | $ | (7 | ) | $ | 40 | ||||||
Unsecured financing to hotel owners | 53 | 40 | (53 | ) | 51 |
Interest Income | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Secured financing to hotel owners | $ | 1 | $ | 1 | $ | 2 | $ | 2 | |||||||
Unsecured financing to hotel owners | — | — | — | — |
• | Past-due Receivables—We determine financing receivables to be past-due based on the contractual terms of each individual financing receivable agreement. |
• | Non-Performing Receivables—Receivables are determined to be non-performing based upon the following criteria: (1) if interest or principal is more than 90 days past due for secured financing to hotel owners and unsecured financing to hotel owners; (2) if interest or principal is more than 120 days past due for vacation ownership mortgage receivables; or (3) if an impairment charge has been recorded for a loan or a provision established for our other financing arrangements. For the three and nine months ended September 30, 2013 and 2012, no interest income was accrued for secured financing to hotel owners and unsecured financing to hotel owners more than 90 days past due or for vacation ownership receivables more than 120 days past due. For the three and nine months ended September 30, 2013 and 2012, insignificant interest income was accrued for vacation ownership receivables past due more than 90 days but less than 120 days. |
Analysis of Financing Receivables | |||||||||||
September 30, 2013 | |||||||||||
Receivables Past Due | Greater than 90 Days Past Due | Receivables on Non-Accrual Status | |||||||||
Secured financing to hotel owners | $ | — | $ | — | $ | 40 | |||||
Vacation ownership mortgage receivables | 2 | — | — | ||||||||
Unsecured financing to hotel owners * | 3 | 3 | 83 | ||||||||
Total | $ | 5 | $ | 3 | $ | 123 |
Analysis of Financing Receivables | |||||||||||
December 31, 2012 | |||||||||||
Receivables Past Due | Greater than 90 Days Past Due | Receivables on Non-Accrual Status | |||||||||
Secured financing to hotel owners | $ | — | $ | — | $ | 40 | |||||
Vacation ownership mortgage receivables | 2 | — | — | ||||||||
Unsecured financing to hotel owners * | 3 | 3 | 81 | ||||||||
Total | $ | 5 | $ | 3 | $ | 121 |
|
Cash and cash equivalents | $ | 12 | |
Other current assets | 4 | ||
Land, property, and equipment | 190 | ||
Intangibles | 12 | ||
Goodwill | 29 | ||
Total assets | 247 | ||
Current liabilities | 4 | ||
Other long-term liabilities | 41 | ||
Total liabilities | 45 | ||
Total net assets acquired | $ | 202 |
|
September 30, 2013 | Weighted Average Useful Lives in Years | December 31, 2012 | ||||||||
Contract acquisition costs | $ | 349 | 26 | $ | 203 | |||||
Acquired lease rights | 140 | 112 | 139 | |||||||
Franchise and management intangibles | 128 | 25 | 122 | |||||||
Brand Intangible | 7 | — | — | |||||||
Other | 7 | 14 | 10 | |||||||
631 | 474 | |||||||||
Accumulated amortization | (102 | ) | (86 | ) | ||||||
Intangibles, net | $ | 529 | $ | 388 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Amortization expense | $ | 6 | $ | 7 | $ | 18 | $ | 19 |
|
|
September 30, 2013 | December 31, 2012 | ||||||
Pound Sterling | $ | 158 | $ | 161 | |||
Korean Won | 31 | 31 | |||||
Swiss Franc | 25 | 32 | |||||
Canadian Dollar | 3 | 30 | |||||
Total notional amount of forward contracts | $ | 217 | $ | 254 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
Location of Gain (Loss) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Fair value hedges: | |||||||||||||||||
Interest rate swaps | |||||||||||||||||
Gains on derivatives | Other income (loss), net* | $ | — | $ | — | $ | — | $ | 1 | ||||||||
Losses on borrowings | Other income (loss), net* | — | — | — | (1 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
Location of Gain (Loss) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Derivatives not designated as hedges: | |||||||||||||||||
Foreign currency forward contracts | Other income (loss), net | $ | (12 | ) | $ | (7 | ) | $ | (1 | ) | $ | (9 | ) |
* | For the nine months ended September 30, 2013, there was an insignificant gain recognized in income related to the ineffective portion of these hedges. For the three and nine months ended September 30, 2012, there was an insignificant loss recognized in income related to the ineffective portion of these hedges. No amounts were excluded from the assessment of hedge effectiveness for the nine months ended September 30, 2013 and the three and nine months ended September 30, 2012. |
|
|
Property Description | Maximum Guarantee Amount (local currency) | Maximum Guarantee Amount (USD at September 30, 2013) | Initial Liability Recorded (local currency) | Liability Recorded at September 30, 2013 | ||||||||
Four hotels in France* | Euro 377 | $ | 509 | Euro 90 | $ | 118 | ||||||
A hotel in Thailand | Thai baht 360 | 11 | Thai baht 157 | 5 | ||||||||
Select service hotels in the U.S. | 15 | 1 | ||||||||||
Other | 6 | — | ||||||||||
Total | $ | 541 | $ | 124 |
Property Description | Maximum Guarantee Amount | Amount Recorded at September 30, 2013 | ||||||
Vacation ownership development | $ | 110 | $ | 1 | ||||
Hotel property in Brazil | 75 | 3 | ||||||
Hawaii hotel development | 30 | 1 | ||||||
Hotel property in Minnesota | 25 | 4 | ||||||
Other | 32 | — | ||||||
Total Debt Repayment Guarantees | $ | 272 | $ | 9 |
|
Stockholders’ equity | Noncontrolling interests in consolidated subsidiaries | Total equity | |||||||||
Balance at January 1, 2013 | $ | 4,811 | $ | 10 | $ | 4,821 | |||||
Net income | 175 | — | 175 | ||||||||
Other comprehensive loss | (10 | ) | — | (10 | ) | ||||||
Repurchase of common stock | (252 | ) | — | (252 | ) | ||||||
Directors compensation | 2 | — | 2 | ||||||||
Employee stock plan issuance | 2 | — | 2 | ||||||||
Share based payment activity | 15 | — | 15 | ||||||||
Balance at September 30, 2013 | $ | 4,743 | $ | 10 | $ | 4,753 | |||||
Balance at January 1, 2012 | $ | 4,808 | $ | 10 | $ | 4,818 | |||||
Net income | 72 | — | 72 | ||||||||
Other comprehensive loss | 25 | — | 25 | ||||||||
Repurchase of common stock | (35 | ) | — | (35 | ) | ||||||
Directors compensation | 1 | — | 1 | ||||||||
Employee stock plan issuance | 2 | — | 2 | ||||||||
Share based payment activity | 12 | — | 12 | ||||||||
Balance at September 30, 2012 | $ | 4,885 | $ | 10 | $ | 4,895 |
Balance at July 1, 2013 | Current period other comprehensive income (loss) before reclassification | Amount Reclassified from Accumulated Other Comprehensive Loss | Balance at September 30, 2013 | ||||||||||||
Foreign currency translation adjustments | $ | (80 | ) | $ | 16 | $ | — | $ | (64 | ) | |||||
Unrealized gain (loss) on AFS securities | — | — | — | ||||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (7 | ) | — | (7 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (93 | ) | $ | 16 | $ | — | $ | (77 | ) | |||||
Balance at January 1, 2013 | Current period other comprehensive income (loss) before reclassification | Amount Reclassified from Accumulated Other Comprehensive Loss (a) | Balance at September 30, 2013 | ||||||||||||
Foreign currency translation adjustments | $ | (54 | ) | $ | (12 | ) | $ | 2 | $ | (64 | ) | ||||
Unrealized gain (loss) on AFS securities | — | — | — | ||||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (7 | ) | — | (7 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (67 | ) | $ | (12 | ) | $ | 2 | $ | (77 | ) | ||||
(a) Foreign currency translation adjustments, net of an insignificant tax impact, reclassified from accumulated other comprehensive loss were recognized within equity earnings (losses) from unconsolidated hospitality ventures on the condensed consolidated statements of income. | |||||||||||||||
Balance at July 1, 2012 | Current period other comprehensive income (loss) | Balance at September 30, 2012 | |||||||||||||
Foreign currency translation adjustments | $ | (88 | ) | $ | 28 | $ | (60 | ) | |||||||
Unrealized gain (loss) on AFS securities | (1 | ) | 1 | — | |||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (8 | ) | — | (8 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (103 | ) | $ | 29 | $ | (74 | ) | |||||||
Balance at January 1, 2012 | Current period other comprehensive income (loss) | Balance at September 30, 2012 | |||||||||||||
Foreign currency translation adjustments | $ | (83 | ) | $ | 23 | $ | (60 | ) | |||||||
Unrealized gain (loss) on AFS securities | (2 | ) | 2 | — | |||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (8 | ) | — | (8 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (99 | ) | $ | 25 | $ | (74 | ) | |||||||
|
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Stock appreciation rights | $ | 2 | $ | 2 | $ | 6 | $ | 6 | |||||||
Restricted stock units | 4 | 4 | 12 | 10 | |||||||||||
Performance share units and Performance vested restricted stock | 1 | — | 2 | 1 |
|
|
(in millions) | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Owned and Leased Hotels (a) | |||||||||||||||
Revenues | $ | 521 | $ | 503 | $ | 1,585 | $ | 1,504 | |||||||
Adjusted EBITDA | 111 | 115 | 351 | 340 | |||||||||||
Depreciation and Amortization | 73 | 80 | 231 | 241 | |||||||||||
Americas Management and Franchising | |||||||||||||||
Revenues | 437 | 425 | 1,302 | 1,295 | |||||||||||
Intersegment Revenues (b) | 20 | 19 | 63 | 59 | |||||||||||
Adjusted EBITDA | 52 | 49 | 162 | 149 | |||||||||||
Depreciation and Amortization | 4 | 5 | 13 | 15 | |||||||||||
ASPAC Management and Franchising | |||||||||||||||
Revenues | 35 | 28 | 110 | 88 | |||||||||||
Intersegment Revenues (b) | 1 | 1 | 2 | 2 | |||||||||||
Adjusted EBITDA | 9 | 9 | 32 | 31 | |||||||||||
Depreciation and Amortization | 1 | — | 1 | — | |||||||||||
EAME/SW Asia Management | |||||||||||||||
Revenues | 30 | 20 | 95 | 64 | |||||||||||
Intersegment Revenues (b) | 3 | 4 | 11 | 11 | |||||||||||
Adjusted EBITDA | 11 | 5 | 39 | 19 | |||||||||||
Depreciation and Amortization | 1 | 1 | 3 | 2 | |||||||||||
Corporate and other | |||||||||||||||
Revenues | 27 | 25 | 77 | 70 | |||||||||||
Adjusted EBITDA | (24 | ) | (24 | ) | (82 | ) | (80 | ) | |||||||
Depreciation and Amortization | 2 | 2 | 6 | 5 | |||||||||||
Eliminations (b) | |||||||||||||||
Revenues | (24 | ) | (24 | ) | (76 | ) | (72 | ) | |||||||
Adjusted EBITDA | — | — | — | — | |||||||||||
Depreciation and Amortization | — | — | — | — | |||||||||||
TOTAL | |||||||||||||||
Revenues | $ | 1,026 | $ | 977 | $ | 3,093 | $ | 2,949 | |||||||
Adjusted EBITDA | 159 | 154 | 502 | 459 | |||||||||||
Depreciation and Amortization | 81 | 88 | 254 | 263 |
(a) | During the second quarter of 2013, we classified a property as held for sale. We conducted an analysis to determine if our carrying value is greater than fair value based on expected sales price. As a result of this assessment we recorded a $3 million impairment charge to asset impairments in the condensed consolidated statements of income in the nine months ended September 30, 2013. In conjunction with our regular assessment of impairment indicators in the first quarter of 2013, we identified property and equipment whose carrying value exceeded its fair value and as a result recorded an $8 million impairment charge to asset impairments in the condensed consolidated statements of income in the nine months ended September 30, 2013. |
(b) | Intersegment revenues are included in the segment revenue totals and eliminated in Eliminations. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Adjusted EBITDA | $ | 159 | $ | 154 | $ | 502 | $ | 459 | |||||||
Equity earnings (losses) from unconsolidated hospitality ventures | 16 | (5 | ) | 10 | (6 | ) | |||||||||
Asset impairments | — | — | (11 | ) | — | ||||||||||
Gains on sales of real estate | 26 | — | 125 | — | |||||||||||
Other income (loss), net (see Note 17) | 2 | (5 | ) | (12 | ) | 12 | |||||||||
Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA | (13 | ) | (18 | ) | (48 | ) | (58 | ) | |||||||
EBITDA | 190 | 126 | 566 | 407 | |||||||||||
Depreciation and amortization | (81 | ) | (88 | ) | (254 | ) | (263 | ) | |||||||
Interest expense | (15 | ) | (18 | ) | (48 | ) | (53 | ) | |||||||
(Provision) benefit for income taxes | (39 | ) | 3 | (89 | ) | (19 | ) | ||||||||
Net income attributable to Hyatt Hotels Corporation | $ | 55 | $ | 23 | $ | 175 | $ | 72 |
|
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Interest income | $ | 4 | $ | 6 | $ | 14 | $ | 17 | |||||||
Cost method investment income | — | — | 4 | — | |||||||||||
Debt settlement costs | — | — | (35 | ) | — | ||||||||||
Charitable contribution to Hyatt Thrive Foundation | — | — | (20 | ) | — | ||||||||||
Gain on sale of artwork | — | — | 29 | — | |||||||||||
Gains on other marketable securities | 1 | — | 1 | 17 | |||||||||||
Foreign currency losses | (1 | ) | (1 | ) | (4 | ) | (3 | ) | |||||||
Realignment costs | — | (12 | ) | — | (19 | ) | |||||||||
Transaction costs | (3 | ) | — | (3 | ) | (1 | ) | ||||||||
Other | 1 | 2 | 2 | 1 | |||||||||||
Other income (loss), net | $ | 2 | $ | (5 | ) | $ | (12 | ) | $ | 12 |
|
|
• | Past-due Receivables—We determine financing receivables to be past-due based on the contractual terms of each individual financing receivable agreement. |
• | Non-Performing Receivables—Receivables are determined to be non-performing based upon the following criteria: (1) if interest or principal is more than 90 days past due for secured financing to hotel owners and unsecured financing to hotel owners; (2) if interest or principal is more than 120 days past due for vacation ownership mortgage receivables; or (3) if an impairment charge has been recorded for a loan or a provision established for our other financing arrangements. For the three and nine months ended September 30, 2013 and 2012, no interest income was accrued for secured financing to hotel owners and unsecured financing to hotel owners more than 90 days past due or for vacation ownership receivables more than 120 days past due. For the three and nine months ended September 30, 2013 and 2012, insignificant interest income was accrued for vacation ownership receivables past due more than 90 days but less than 120 days. |
• | Secured Financing to Hotel Owners—These financing receivables are senior secured mortgage loans and are collateralized by hotel properties currently in operation. These loans at September 30, 2013 and December 31, 2012 include financing provided to certain franchisees for the renovation and conversion of certain franchised hotels. These franchisee loans accrue interest at fixed rates ranging between 5.0% and 5.5%. Secured financing to hotel owners at December 31, 2012 consisted primarily of a $277 million mortgage loan receivable to an unconsolidated hospitality venture which was formed to acquire ownership of a hotel property in Waikiki, Hawaii. This mortgage receivable had interest set at 30-day LIBOR +3.75% due monthly and a stated maturity date of July 2013. This receivable was repaid in full, including payment of all accrued, but unpaid interest in the third quarter of 2013. |
• | Vacation Ownership Mortgage Receivables—These financing receivables are comprised of various mortgage loans related to our financing of vacation ownership interval sales. As of September 30, 2013, the weighted-average interest rate on vacation ownership mortgage receivables was 14.0%. |
• | Unsecured Financing to Hotel Owners—These financing receivables are primarily made up of individual unsecured loans and other types of financing arrangements provided to hotel owners. During 2012, we entered into a loan agreement to provide a $50 million mezzanine loan for the construction of a hotel that we will manage. Under the loan agreement, interest accrues at the greater of one-month LIBOR plus 5.0%, or 6.5%. Our other financing receivables have stated maturities and interest rates. However, the expected repayment terms may be dependent on the future cash flows of the hotels and these instruments, therefore, are not considered loans as the repayment dates are not fixed or determinable. Because these arrangements are not considered loans, we do not include them in our impaired loans analysis. Since these receivables may come due earlier than the stated maturity date, the expected maturity dates have been excluded from the maturities table below. |
|
September 30, 2013 | December 31, 2012 | ||||||
Equity method investments | $ | 402 | $ | 212 | |||
Cost method investments | 71 | 71 | |||||
Total investments | $ | 473 | $ | 283 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Total revenues | $ | 246 | $ | 268 | $ | 721 | $ | 762 | |||||||
Gross operating profit | 78 | 93 | 236 | 246 | |||||||||||
Income from continuing operations | 28 | 11 | 24 | 14 | |||||||||||
Net income | 28 | 11 | 24 | 14 |
|
September 30, 2013 | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | ||||||||||||
Marketable securities recorded in cash and cash equivalents | |||||||||||||||
Interest bearing money market funds | $ | 67 | $ | 67 | $ | — | $ | — | |||||||
Marketable securities included in short-term investments, prepaids and other assets, and other assets | |||||||||||||||
Mutual funds | 314 | 314 | — | — | |||||||||||
Equity securities | 8 | 8 | — | — | |||||||||||
U.S. government obligations | 120 | — | 120 | — | |||||||||||
U.S. government agencies | 48 | — | 48 | — | |||||||||||
Corporate debt securities | 109 | — | 109 | — | |||||||||||
Mortgage-backed securities | 20 | — | 20 | — | |||||||||||
Asset-backed securities | 17 | — | 17 | — | |||||||||||
Municipal and provincial notes and bonds | 3 | — | 3 | — | |||||||||||
Preferred shares | 225 | — | — | 225 | |||||||||||
Derivative instruments | |||||||||||||||
Foreign currency forward contracts | (7 | ) | — | (7 | ) | — |
December 31, 2012 | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | ||||||||||||
Marketable securities recorded in cash and cash equivalents | |||||||||||||||
Interest bearing money market funds | $ | 117 | $ | 117 | $ | — | $ | — | |||||||
Marketable securities included in short-term investments, prepaids and other assets, and other assets | |||||||||||||||
Mutual funds | 275 | 275 | — | — | |||||||||||
Equity securities | 10 | 10 | — | — | |||||||||||
U.S. government obligations | 111 | — | 111 | — | |||||||||||
U.S. government agencies | 68 | — | 68 | — | |||||||||||
Corporate debt securities | 540 | — | 540 | — | |||||||||||
Mortgage-backed securities | 22 | — | 22 | — | |||||||||||
Asset-backed securities | 10 | — | 10 | — | |||||||||||
Municipal and provincial notes and bonds | 15 | — | 15 | — | |||||||||||
Derivative instruments | |||||||||||||||
Interest rate swaps | 1 | — | 1 | — | |||||||||||
Foreign currency forward contracts | (1 | ) | — | (1 | ) | — |
September 30, 2013 | |||||||||||||||
Cost or Amortized Cost | Gross Unrealized Gain | Gross Unrealized Loss | Fair Value | ||||||||||||
Equity securities | $ | 7 | $ | 1 | $ | — | $ | 8 | |||||||
Preferred shares | 225 | — | — | 225 | |||||||||||
Total | $ | 232 | $ | 1 | $ | — | $ | 233 |
December 31, 2012 | |||||||||||||||
Cost or Amortized Cost | Gross Unrealized Gain | Gross Unrealized Loss | Fair Value | ||||||||||||
Corporate debt securities | $ | 443 | $ | 8 | $ | (8 | ) | $ | 443 | ||||||
U.S. government agencies and municipalities | 31 | — | — | 31 | |||||||||||
Equity securities | 9 | 1 | — | 10 | |||||||||||
Total | $ | 483 | $ | 9 | $ | (8 | ) | $ | 484 |
Asset (Liability) | |||||||||||||||||||
September 30, 2013 | |||||||||||||||||||
Carrying Value | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | |||||||||||||||
Financing receivables | |||||||||||||||||||
Secured financing to hotel owners | $ | 32 | $ | 38 | $ | — | $ | — | $ | 38 | |||||||||
Vacation ownership mortgage receivable | 37 | 38 | — | — | 38 | ||||||||||||||
Unsecured financing to hotel owners | 64 | 63 | — | — | 63 | ||||||||||||||
Debt, excluding capital lease obligations | (1,097 | ) | (1,147 | ) | — | (1,093 | ) | (54 | ) |
Asset (Liability) | |||||||||||||||||||
December 31, 2012 | |||||||||||||||||||
Carrying Value | Fair Value | Quoted Prices in Active Markets for Identical Assets (Level One) | Significant Other Observable Inputs (Level Two) | Significant Unobservable Inputs (Level Three) | |||||||||||||||
Financing receivables | |||||||||||||||||||
Secured financing to hotel owners | $ | 310 | $ | 314 | $ | — | $ | — | $ | 314 | |||||||||
Vacation ownership mortgage receivable | 39 | 39 | — | — | 39 | ||||||||||||||
Unsecured financing to hotel owners | 64 | 64 | — | — | 64 | ||||||||||||||
Debt, excluding capital lease obligations | (1,017 | ) | (1,137 | ) | — | (1,126 | ) | (11 | ) |
|
September 30, 2013 | December 31, 2012 | ||||||
Secured financing to hotel owners | $ | 39 | $ | 317 | |||
Vacation ownership mortgage receivables at various interest rates with varying payments through 2023 | 45 | 48 | |||||
Unsecured financing to hotel owners | 147 | 147 | |||||
231 | 512 | ||||||
Less allowance for losses | (98 | ) | (99 | ) | |||
Less current portion included in receivables, net | (8 | ) | (287 | ) | |||
Total long-term financing receivables, net | $ | 125 | $ | 126 |
Year Ending December 31, | Secured Financing to Hotel Owners | Vacation Ownership Mortgage Receivables | |||||
2013 | $ | — | $ | 2 | |||
2014 | 1 | 7 | |||||
2015 | 38 | 7 | |||||
2016 | — | 7 | |||||
2017 | — | 5 | |||||
2018 | — | 4 | |||||
Thereafter | — | 13 | |||||
Total | 39 | 45 | |||||
Less allowance | (7 | ) | (8 | ) | |||
Net financing receivables | $ | 32 | $ | 37 |
Secured Financing | Vacation Ownership | Unsecured Financing | Total | ||||||||||||
Allowance at January 1, 2013 | $ | 7 | $ | 9 | $ | 83 | $ | 99 | |||||||
Provisions | — | — | 2 | 2 | |||||||||||
Write-offs | — | (2 | ) | (2 | ) | (4 | ) | ||||||||
Recoveries | — | — | — | — | |||||||||||
Other Adjustments | — | — | (1 | ) | (1 | ) | |||||||||
Allowance at June 30, 2013 | $ | 7 | $ | 7 | $ | 82 | $ | 96 | |||||||
Provisions | — | 1 | 1 | 2 | |||||||||||
Write-offs | — | — | — | — | |||||||||||
Recoveries | — | — | — | — | |||||||||||
Other Adjustments | — | — | — | — | |||||||||||
Allowance at September 30, 2013 | $ | 7 | $ | 8 | $ | 83 | $ | 98 |
Secured Financing | Vacation Ownership | Unsecured Financing | Total | ||||||||||||
Allowance at January 1, 2012 | $ | 7 | $ | 8 | $ | 75 | $ | 90 | |||||||
Provisions | — | 3 | 6 | 9 | |||||||||||
Write-offs | — | (3 | ) | (3 | ) | (6 | ) | ||||||||
Recoveries | — | — | (2 | ) | (2 | ) | |||||||||
Other Adjustments | — | — | — | — | |||||||||||
Allowance at June 30, 2012 | $ | 7 | $ | 8 | $ | 76 | $ | 91 | |||||||
Provisions | — | 1 | 2 | 3 | |||||||||||
Write-offs | — | (1 | ) | — | (1 | ) | |||||||||
Recoveries | — | — | — | — | |||||||||||
Other Adjustments | — | — | — | — | |||||||||||
Allowance at September 30, 2012 | $ | 7 | $ | 8 | $ | 78 | $ | 93 |
Impaired Loans | |||||||||||||||
September 30, 2013 | |||||||||||||||
Gross Loan Balance (Principal and Interest) | Unpaid Principal Balance | Related Allowance | Average Recorded Loan Balance | ||||||||||||
Secured financing to hotel owners | $ | 40 | $ | 39 | $ | (7 | ) | $ | 40 | ||||||
Unsecured financing to hotel owners | 53 | 39 | (53 | ) | 54 |
Impaired Loans | |||||||||||||||
December 31, 2012 | |||||||||||||||
Gross Loan Balance (Principal and Interest) | Unpaid Principal Balance | Related Allowance | Average Recorded Loan Balance | ||||||||||||
Secured financing to hotel owners | $ | 40 | $ | 39 | $ | (7 | ) | $ | 40 | ||||||
Unsecured financing to hotel owners | 53 | 40 | (53 | ) | 51 |
Interest Income | |||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Secured financing to hotel owners | $ | 1 | $ | 1 | $ | 2 | $ | 2 | |||||||
Unsecured financing to hotel owners | — | — | — | — |
Analysis of Financing Receivables | |||||||||||
September 30, 2013 | |||||||||||
Receivables Past Due | Greater than 90 Days Past Due | Receivables on Non-Accrual Status | |||||||||
Secured financing to hotel owners | $ | — | $ | — | $ | 40 | |||||
Vacation ownership mortgage receivables | 2 | — | — | ||||||||
Unsecured financing to hotel owners * | 3 | 3 | 83 | ||||||||
Total | $ | 5 | $ | 3 | $ | 123 |
Analysis of Financing Receivables | |||||||||||
December 31, 2012 | |||||||||||
Receivables Past Due | Greater than 90 Days Past Due | Receivables on Non-Accrual Status | |||||||||
Secured financing to hotel owners | $ | — | $ | — | $ | 40 | |||||
Vacation ownership mortgage receivables | 2 | — | — | ||||||||
Unsecured financing to hotel owners * | 3 | 3 | 81 | ||||||||
Total | $ | 5 | $ | 3 | $ | 121 |
|
Cash and cash equivalents | $ | 12 | |
Other current assets | 4 | ||
Land, property, and equipment | 190 | ||
Intangibles | 12 | ||
Goodwill | 29 | ||
Total assets | 247 | ||
Current liabilities | 4 | ||
Other long-term liabilities | 41 | ||
Total liabilities | 45 | ||
Total net assets acquired | $ | 202 |
|
September 30, 2013 | Weighted Average Useful Lives in Years | December 31, 2012 | ||||||||
Contract acquisition costs | $ | 349 | 26 | $ | 203 | |||||
Acquired lease rights | 140 | 112 | 139 | |||||||
Franchise and management intangibles | 128 | 25 | 122 | |||||||
Brand Intangible | 7 | — | — | |||||||
Other | 7 | 14 | 10 | |||||||
631 | 474 | |||||||||
Accumulated amortization | (102 | ) | (86 | ) | ||||||
Intangibles, net | $ | 529 | $ | 388 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Amortization expense | $ | 6 | $ | 7 | $ | 18 | $ | 19 |
|
September 30, 2013 | December 31, 2012 | ||||||
Pound Sterling | $ | 158 | $ | 161 | |||
Korean Won | 31 | 31 | |||||
Swiss Franc | 25 | 32 | |||||
Canadian Dollar | 3 | 30 | |||||
Total notional amount of forward contracts | $ | 217 | $ | 254 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
Location of Gain (Loss) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Fair value hedges: | |||||||||||||||||
Interest rate swaps | |||||||||||||||||
Gains on derivatives | Other income (loss), net* | $ | — | $ | — | $ | — | $ | 1 | ||||||||
Losses on borrowings | Other income (loss), net* | — | — | — | (1 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||
Location of Gain (Loss) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Derivatives not designated as hedges: | |||||||||||||||||
Foreign currency forward contracts | Other income (loss), net | $ | (12 | ) | $ | (7 | ) | $ | (1 | ) | $ | (9 | ) |
* | For the nine months ended September 30, 2013, there was an insignificant gain recognized in income related to the ineffective portion of these hedges. For the three and nine months ended September 30, 2012, there was an insignificant loss recognized in income related to the ineffective portion of these hedges. No amounts were excluded from the assessment of hedge effectiveness for the nine months ended September 30, 2013 and the three and nine months ended September 30, 2012. |
|
Property Description | Maximum Guarantee Amount (local currency) | Maximum Guarantee Amount (USD at September 30, 2013) | Initial Liability Recorded (local currency) | Liability Recorded at September 30, 2013 | ||||||||
Four hotels in France* | Euro 377 | $ | 509 | Euro 90 | $ | 118 | ||||||
A hotel in Thailand | Thai baht 360 | 11 | Thai baht 157 | 5 | ||||||||
Select service hotels in the U.S. | 15 | 1 | ||||||||||
Other | 6 | — | ||||||||||
Total | $ | 541 | $ | 124 |
Property Description | Maximum Guarantee Amount | Amount Recorded at September 30, 2013 | ||||||
Vacation ownership development | $ | 110 | $ | 1 | ||||
Hotel property in Brazil | 75 | 3 | ||||||
Hawaii hotel development | 30 | 1 | ||||||
Hotel property in Minnesota | 25 | 4 | ||||||
Other | 32 | — | ||||||
Total Debt Repayment Guarantees | $ | 272 | $ | 9 |
|
Stockholders’ equity | Noncontrolling interests in consolidated subsidiaries | Total equity | |||||||||
Balance at January 1, 2013 | $ | 4,811 | $ | 10 | $ | 4,821 | |||||
Net income | 175 | — | 175 | ||||||||
Other comprehensive loss | (10 | ) | — | (10 | ) | ||||||
Repurchase of common stock | (252 | ) | — | (252 | ) | ||||||
Directors compensation | 2 | — | 2 | ||||||||
Employee stock plan issuance | 2 | — | 2 | ||||||||
Share based payment activity | 15 | — | 15 | ||||||||
Balance at September 30, 2013 | $ | 4,743 | $ | 10 | $ | 4,753 | |||||
Balance at January 1, 2012 | $ | 4,808 | $ | 10 | $ | 4,818 | |||||
Net income | 72 | — | 72 | ||||||||
Other comprehensive loss | 25 | — | 25 | ||||||||
Repurchase of common stock | (35 | ) | — | (35 | ) | ||||||
Directors compensation | 1 | — | 1 | ||||||||
Employee stock plan issuance | 2 | — | 2 | ||||||||
Share based payment activity | 12 | — | 12 | ||||||||
Balance at September 30, 2012 | $ | 4,885 | $ | 10 | $ | 4,895 |
Balance at July 1, 2013 | Current period other comprehensive income (loss) before reclassification | Amount Reclassified from Accumulated Other Comprehensive Loss | Balance at September 30, 2013 | ||||||||||||
Foreign currency translation adjustments | $ | (80 | ) | $ | 16 | $ | — | $ | (64 | ) | |||||
Unrealized gain (loss) on AFS securities | — | — | — | ||||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (7 | ) | — | (7 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (93 | ) | $ | 16 | $ | — | $ | (77 | ) | |||||
Balance at January 1, 2013 | Current period other comprehensive income (loss) before reclassification | Amount Reclassified from Accumulated Other Comprehensive Loss (a) | Balance at September 30, 2013 | ||||||||||||
Foreign currency translation adjustments | $ | (54 | ) | $ | (12 | ) | $ | 2 | $ | (64 | ) | ||||
Unrealized gain (loss) on AFS securities | — | — | — | ||||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (7 | ) | — | (7 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (67 | ) | $ | (12 | ) | $ | 2 | $ | (77 | ) | ||||
(a) Foreign currency translation adjustments, net of an insignificant tax impact, reclassified from accumulated other comprehensive loss were recognized within equity earnings (losses) from unconsolidated hospitality ventures on the condensed consolidated statements of income. | |||||||||||||||
Balance at July 1, 2012 | Current period other comprehensive income (loss) | Balance at September 30, 2012 | |||||||||||||
Foreign currency translation adjustments | $ | (88 | ) | $ | 28 | $ | (60 | ) | |||||||
Unrealized gain (loss) on AFS securities | (1 | ) | 1 | — | |||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (8 | ) | — | (8 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (103 | ) | $ | 29 | $ | (74 | ) | |||||||
Balance at January 1, 2012 | Current period other comprehensive income (loss) | Balance at September 30, 2012 | |||||||||||||
Foreign currency translation adjustments | $ | (83 | ) | $ | 23 | $ | (60 | ) | |||||||
Unrealized gain (loss) on AFS securities | (2 | ) | 2 | — | |||||||||||
Unrecognized pension cost | (6 | ) | — | (6 | ) | ||||||||||
Unrealized loss on derivative instruments | (8 | ) | — | (8 | ) | ||||||||||
Accumulated Other Comprehensive Loss | $ | (99 | ) | $ | 25 | $ | (74 | ) | |||||||
|
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Stock appreciation rights | $ | 2 | $ | 2 | $ | 6 | $ | 6 | |||||||
Restricted stock units | 4 | 4 | 12 | 10 | |||||||||||
Performance share units and Performance vested restricted stock | 1 | — | 2 | 1 |
|
(in millions) | Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Owned and Leased Hotels (a) | |||||||||||||||
Revenues | $ | 521 | $ | 503 | $ | 1,585 | $ | 1,504 | |||||||
Adjusted EBITDA | 111 | 115 | 351 | 340 | |||||||||||
Depreciation and Amortization | 73 | 80 | 231 | 241 | |||||||||||
Americas Management and Franchising | |||||||||||||||
Revenues | 437 | 425 | 1,302 | 1,295 | |||||||||||
Intersegment Revenues (b) | 20 | 19 | 63 | 59 | |||||||||||
Adjusted EBITDA | 52 | 49 | 162 | 149 | |||||||||||
Depreciation and Amortization | 4 | 5 | 13 | 15 | |||||||||||
ASPAC Management and Franchising | |||||||||||||||
Revenues | 35 | 28 | 110 | 88 | |||||||||||
Intersegment Revenues (b) | 1 | 1 | 2 | 2 | |||||||||||
Adjusted EBITDA | 9 | 9 | 32 | 31 | |||||||||||
Depreciation and Amortization | 1 | — | 1 | — | |||||||||||
EAME/SW Asia Management | |||||||||||||||
Revenues | 30 | 20 | 95 | 64 | |||||||||||
Intersegment Revenues (b) | 3 | 4 | 11 | 11 | |||||||||||
Adjusted EBITDA | 11 | 5 | 39 | 19 | |||||||||||
Depreciation and Amortization | 1 | 1 | 3 | 2 | |||||||||||
Corporate and other | |||||||||||||||
Revenues | 27 | 25 | 77 | 70 | |||||||||||
Adjusted EBITDA | (24 | ) | (24 | ) | (82 | ) | (80 | ) | |||||||
Depreciation and Amortization | 2 | 2 | 6 | 5 | |||||||||||
Eliminations (b) | |||||||||||||||
Revenues | (24 | ) | (24 | ) | (76 | ) | (72 | ) | |||||||
Adjusted EBITDA | — | — | — | — | |||||||||||
Depreciation and Amortization | — | — | — | — | |||||||||||
TOTAL | |||||||||||||||
Revenues | $ | 1,026 | $ | 977 | $ | 3,093 | $ | 2,949 | |||||||
Adjusted EBITDA | 159 | 154 | 502 | 459 | |||||||||||
Depreciation and Amortization | 81 | 88 | 254 | 263 |
(a) | During the second quarter of 2013, we classified a property as held for sale. We conducted an analysis to determine if our carrying value is greater than fair value based on expected sales price. As a result of this assessment we recorded a $3 million impairment charge to asset impairments in the condensed consolidated statements of income in the nine months ended September 30, 2013. In conjunction with our regular assessment of impairment indicators in the first quarter of 2013, we identified property and equipment whose carrying value exceeded its fair value and as a result recorded an $8 million impairment charge to asset impairments in the condensed consolidated statements of income in the nine months ended September 30, 2013. |
(b) | Intersegment revenues are included in the segment revenue totals and eliminated in Eliminations. |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Adjusted EBITDA | $ | 159 | $ | 154 | $ | 502 | $ | 459 | |||||||
Equity earnings (losses) from unconsolidated hospitality ventures | 16 | (5 | ) | 10 | (6 | ) | |||||||||
Asset impairments | — | — | (11 | ) | — | ||||||||||
Gains on sales of real estate | 26 | — | 125 | — | |||||||||||
Other income (loss), net (see Note 17) | 2 | (5 | ) | (12 | ) | 12 | |||||||||
Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA | (13 | ) | (18 | ) | (48 | ) | (58 | ) | |||||||
EBITDA | 190 | 126 | 566 | 407 | |||||||||||
Depreciation and amortization | (81 | ) | (88 | ) | (254 | ) | (263 | ) | |||||||
Interest expense | (15 | ) | (18 | ) | (48 | ) | (53 | ) | |||||||
(Provision) benefit for income taxes | (39 | ) | 3 | (89 | ) | (19 | ) | ||||||||
Net income attributable to Hyatt Hotels Corporation | $ | 55 | $ | 23 | $ | 175 | $ | 72 |
|
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Interest income | $ | 4 | $ | 6 | $ | 14 | $ | 17 | |||||||
Cost method investment income | — | — | 4 | — | |||||||||||
Debt settlement costs | — | — | (35 | ) | — | ||||||||||
Charitable contribution to Hyatt Thrive Foundation | — | — | (20 | ) | — | ||||||||||
Gain on sale of artwork | — | — | 29 | — | |||||||||||
Gains on other marketable securities | 1 | — | 1 | 17 | |||||||||||
Foreign currency losses | (1 | ) | (1 | ) | (4 | ) | (3 | ) | |||||||
Realignment costs | — | (12 | ) | — | (19 | ) | |||||||||
Transaction costs | (3 | ) | — | (3 | ) | (1 | ) | ||||||||
Other | 1 | 2 | 2 | 1 | |||||||||||
Other income (loss), net | $ | 2 | $ | (5 | ) | $ | (12 | ) | $ | 12 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
|