HYATT HOTELS CORP, 10-Q filed on 8/2/2011
Quarterly Report
Document And Entity Information
6 Months Ended
Jun. 30, 2011
Jul. 28, 2011
Common Class A
Jul. 28, 2011
Common Class B
Document Type
10-Q 
 
 
Amendment Flag
FALSE 
 
 
Document Period End Date
Jun. 30, 2011 
 
 
Document Fiscal Year Focus
2011 
 
 
Document Fiscal Period Focus
Q2 
 
 
Current Fiscal Year End Date
--12-31 
 
 
Entity Central Index Key
0001468174 
 
 
Entity Registrant Name
Hyatt Hotels Corp 
 
 
Entity Filer Category
Large Accelerated Filer 
 
 
Trading Symbol
 
 
Entity Common Stock, Shares Outstanding
 
44,651,851 
120,478,305 
Condensed Consolidated Statements Of Income (USD $)
In Millions, except Per Share data
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
REVENUES:
 
 
 
 
Owned and leased hotels
$ 484 
$ 483 
$ 916 
$ 934 
Management and franchise fees
75 
64 
145 
121 
Other revenues
17 
12 
31 
23 
Other revenues from managed properties
360 
330 
719 
652 
Total revenues
936 
889 
1,811 
1,730 
DIRECT AND SELLING, GENERAL, AND ADMINISTRATIVE EXPENSES:
 
 
 
 
Owned and leased hotels
372 
374 
726 
738 
Depreciation and amortization
72 
66 
143 
136 
Other direct costs
10 
(3)
Selling, general, and administrative
71 
58 
141 
127 
Other costs from managed properties
360 
330 
719 
652 
Direct and selling, general, and administrative expenses
881 
830 
1,739 
1,650 
Net gains (losses) and interest income from marketable securities held to fund operating programs
(8)
(1)
Equity earnings (losses) from unconsolidated hospitality ventures
(11)
(19)
Interest expense
(14)
(12)
(27)
(24)
Asset impairments
(1)
(3)
(1)
(3)
Other income (loss), net
(9)
(6)
(6)
10 
INCOME BEFORE INCOME TAXES
35 
19 
51 
43 
(PROVISION) BENEFIT FOR INCOME TAXES
 
(5)
(17)
INCOME FROM CONTINUING OPERATIONS
36 
19 
46 
26 
DISCONTINUED OPERATIONS:
 
 
 
 
Loss from discontinued operations, net of income tax benefit of $0 and $1 for the three months ended and $0 and $2 for the six months ended June 30, 2011 and 2010 respectively
 
(1)
 
(3)
Gains on sales of discontinued operations, net of income tax expense of $0 and $3 for the three months ended and $0 and $3 for the six months ended June 30, 2011 and 2010, respectively
 
 
NET INCOME
36 
24 
46 
29 
NET LOSS ATTRIBUTABLE TO NONCONTROLLING INTERESTS
NET INCOME ATTRIBUTABLE TO HYATT HOTELS CORPORATION
$ 37 
$ 25 
$ 47 
$ 30 
EARNINGS PER SHARE - Basic
 
 
 
 
Income from continuing operations
$ 0.21 
$ 0.11 
$ 0.27 
$ 0.15 
Gain from discontinued operations
 
$ 0.03 
 
$ 0.02 
Net income (loss) attributable to Hyatt Hotels Corporation
$ 0.22 
$ 0.14 
$ 0.28 
$ 0.17 
EARNINGS PER SHARE - Diluted
 
 
 
 
Income (loss) from continuing operations
$ 0.21 
$ 0.11 
$ 0.27 
$ 0.15 
Gain from discontinued operations
 
$ 0.03 
 
$ 0.02 
Net income (loss) attributable to Hyatt Hotels Corporation
$ 0.22 
$ 0.14 
$ 0.28 
$ 0.17 
Condensed Consolidated Statements Of Income (Parenthetical) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Condensed Consolidated Statements Of Income
 
 
 
 
Tax benefit on discontinued operations
$ 0 
$ (1)
$ 0 
$ (2)
Tax effect of gains on sale of discontinued operations
$ 0 
$ 3 
$ 0 
$ 3 
Condensed Consolidated Balance Sheets (USD $)
In Millions
Jun. 30, 2011
Dec. 31, 2010
ASSETS
 
 
Cash and cash equivalents
$ 876 
$ 1,110 
Restricted cash
47 
106 
Short-term investments
521 
524 
Receivables, net of allowances of $12 and $15 at June 30, 2011 and December 31, 2010, respectively
233 
199 
Inventories
96 
100 
Prepaids and other assets
68 
73 
Prepaid income taxes
27 
Deferred tax assets
30 
29 
Assets held for sale
 
18 
Total current assets
1,898 
2,165 
Investments
278 
245 
Property and equipment, net
3,451 
3,453 
Financing receivables, net of allowances
355 
375 
Goodwill
102 
102 
Intangibles, net
282 
280 
Deferred tax assets
48 
62 
Other assets
583 
561 
TOTAL ASSETS
6,997 
7,243 
LIABILITIES AND EQUITY
 
 
Current maturities of long-term debt
55 
57 
Accounts payable
146 
145 
Accrued expenses and other current liabilities
329 
286 
Accrued compensation and benefits
97 
108 
Total current liabilities
627 
596 
Long-term debt
714 
714 
Other long-term liabilities
822 
802 
Total liabilities
2,163 
2,112 
Commitments and contingencies (see Note 11)
 
 
EQUITY:
 
 
Preferred stock, $0.01 par value per share, 10,000,000 shares authorized and none outstanding as of June 30, 2011 and December 31, 2010
 
 
Common stock
Additional paid-in capital
3,368 
3,751 
Retained earnings
1,451 
1,404 
Treasury stock at cost, 36,273 shares at June 30, 2011 and December 31, 2010
(1)
(1)
Accumulated other comprehensive income (loss)
(38)
Total stockholders' equity
4,822 
5,118 
Noncontrolling interests in consolidated subsidiaries
12 
13 
Total equity
4,834 
5,131 
TOTAL LIABILITIES AND EQUITY
$ 6,997 
$ 7,243 
Condensed Consolidated Balance Sheets (Parenthetical) (USD $)
In Millions, except Share data
Jun. 30, 2011
Dec. 31, 2010
Allowance for receivables
$ 12 
$ 15 
Preferred stock, par value
$ 0.01 
$ 0.01 
Preferred stock, shares authorized
10,000,000 
10,000,000 
Preferred stock, outstanding
Treasury stock, shares
36,273 
36,273 
Common Class A
 
 
Common stock, par value
$ 0.01 
$ 0.01 
Common stock, shares authorized
1,000,000,000 
1,000,000,000 
Common stock, outstanding
44,624,962 
44,487,197 
Common stock, issued
44,661,235 
44,523,470 
Common Class B
 
 
Common stock, par value
$ 0.01 
$ 0.01 
Common stock, shares authorized
452,472,717 
461,460,412 
Common stock, outstanding
120,478,305 
129,466,000 
Common stock, issued
120,478,305 
129,466,000 
Condensed Consolidated Statements Of Cash Flows (USD $)
In Millions
6 Months Ended
Jun. 30,
2011
2010
CASH FLOWS FROM OPERATING ACTIVITIES:
 
 
Net income (loss)
$ 46 
$ 29 
Gain on sale of discontinued operations
 
(6)
Loss from discontinued operations
 
Income from continuing operations
46 
26 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
Depreciation and amortization
143 
136 
Deferred income taxes
(6)
 
Asset impairments
Equity (earnings) losses from unconsolidated hospitality ventures, including distributions received
26 
Loss on sales of real estate
 
Foreign currency losses
Net unrealized (gains) losses from other marketable securities
(2)
Working capital changes and other
10 
(7)
Net cash provided by operating activities of continuing operations
210 
184 
CASH FLOWS FROM INVESTING ACTIVITIES:
 
 
Purchases of marketable securities and short-term investments
(160)
(419)
Proceeds from marketable securities and short-term investments
151 
81 
Contributions to investments
(19)
(17)
Acquisitions, net of cash acquired
(77)
 
Capital expenditures
(118)
(90)
Contract acquisition costs
(6)
(22)
Proceeds from sales of real estate
90 
113 
Real estate sale proceeds transferred to escrow as restricted cash
(35)
(113)
Proceeds from sale of assets held for sale
18 
 
Real estate sale proceeds transferred from escrow to cash and cash equivalents
97 
113 
Other investing activities
(11)
Net cash used in investing activities of continuing operations
(70)
(348)
CASH FLOWS FROM FINANCING ACTIVITIES:
 
 
Proceeds from issuance of long-term debt
25 
 
Repayments of long-term debt
(3)
(4)
Repurchase of Class B common stock
(396)
 
Issuance of treasury shares
 
Other financing activities
 
(2)
Net cash provided by (used in) financing activities of continuing operations
(374)
(5)
CASH PROVIDED BY DISCONTINUED OPERATIONS:
 
 
Net cash provided by operating activities of discontinued operations
 
 
Proceeds from sale of discontinued operations
 
22 
Sale proceeds held in escrow as restricted cash
 
(22)
Net cash provided by investing activities of discontinued operations
 
 
Net cash provided by discontinued operations
 
 
EFFECT OF EXCHANGE RATE CHANGES ON CASH
 
21 
NET DECREASE IN CASH AND CASH EQUIVALENTS
(234)
(148)
CASH AND CASH EQUIVALENTS-BEGINNING OF YEAR
1,110 
1,327 
CASH AND CASH EQUIVALENTS - END OF PERIOD
876 
1,179 
LESS CASH AND CASH EQUIVALENTS DISCONTINUED OPERATIONS
 
 
CASH AND CASH EQUIVALENTS CONTINUING OPERATIONS-END OF PERIOD
876 
1,179 
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
 
 
Cash paid during the period for interest
24 
29 
Cash paid during the period for income taxes
22 
23 
Non-cash investing activities are as follows:
 
 
Equity contribution of property and equipment, net (see Note 6)
10 
 
Equity contribution of long-term debt (see Note 6)
25 
 
Contribution to investment (see Note 3)
$ 20 
 
Organization
Organization
1. ORGANIZATION

Hyatt Hotels Corporation, a Delaware corporation, and its consolidated subsidiaries ("Hyatt Hotels Corporation"), provide hospitality services on a worldwide basis through the management, franchising and ownership of hospitality related businesses. As of June 30, 2011, we operate or franchise 234 full-service hotels consisting of 99,600 rooms, in 44 countries throughout the world. We hold ownership interests in certain of these hotels. As of June 30, 2011, we operate or franchise 199 select-service hotels with 25,681 rooms in the United States. We hold ownership interests in certain of these hotels. We develop, operate, manage, license or provide services to Hyatt-branded timeshare, fractional and other forms of residential or vacation properties.

As used in these Notes and throughout this Quarterly Report on Form 10-Q, the terms "Company," "HHC," "we," "us," or "our" mean Hyatt Hotels Corporation and its consolidated subsidiaries.

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") for interim financial information, the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information or footnotes required by GAAP for complete annual financial statements. As a result, this Quarterly Report on Form 10-Q should be read in conjunction with the Consolidated Financial Statements and accompanying Notes in our Annual Report on Form 10-K for the fiscal year ended December 31, 2010 (the "2010 Form 10-K").

We have eliminated all intercompany transactions in our condensed consolidated financial statements. We do not consolidate the financial statements of any company in which we have an ownership interest of 50% or less unless we control that company.

Management believes that the accompanying condensed consolidated financial statements reflect all adjustments, including normal recurring items, considered necessary for a fair presentation of the interim periods.

Recently Issued Accounting Standards
Recently Issued Accounting Standards
2. RECENTLY ISSUED ACCOUNTING STANDARDS

Adopted Accounting Standards

In December 2010, the Financial Accounting Standards Board ("FASB") released Accounting Standards Update No. 2010-28 ("ASU 2010-28"), Intangibles-Goodwill and Other (Topic 350): When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts. The update requires a company to perform Step 2 of the goodwill impairment test if the carrying value of the reporting unit is zero or negative and adverse qualitative factors indicate that it is more likely than not that a goodwill impairment exists. The qualitative factors to consider are consistent with the existing guidance and examples in Topic 350, which requires that goodwill of a reporting unit be tested for impairment between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying amount. The requirements in ASU 2010-28 became effective for public companies in the first annual period beginning after December 15, 2010. The adoption of ASU 2010-28 on January 1, 2011 did not materially impact our condensed consolidated financial statements.

In December 2010, the FASB released Accounting Standards Update No. 2010-29 ("ASU 2010-29"), Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations. ASU 2010-29 specifies that when a public company completes a business combination(s), the company should disclose revenue and earnings of the combined entity as though the business combination(s) occurred as of the beginning of the comparable prior annual reporting period. The update also expands the supplemental pro forma disclosures under Topic 805 to include a description of the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination included in the pro forma revenue and earnings. The requirements in ASU 2010-29 became effective for business combinations that occur on or after the beginning of the first annual reporting period beginning on or after December 15, 2010. The adoption of ASU 2010-29 on January 1, 2011 did not materially impact our condensed consolidated financial statements.

In January 2010, the FASB released Accounting Standards Update No. 2010-06 ("ASU 2010-06"), Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurement. The update required the Company to (a) disclose significant transfers in and out of Levels One and Two, in addition to transfers in and out of Level Three and (b) separately disclose purchases, sales, issuances, and settlements of our Level Three securities. Additionally, ASU 2010-06 clarifies the information we currently disclose regarding our valuation techniques, inputs used in those valuation models, and the level of detail at which fair value disclosures should be provided. We adopted the Level One and Two disclosure requirements of ASU 2010-06 as of January 1, 2010 with no material impact on our condensed consolidated financial statements. As of January 1, 2011, we adopted the disclosure requirements related to Level Three activity on a gross basis, with no material impact on our fair value disclosures. See Note 4 for a discussion of fair value.

Future Adoption of Accounting Standards

In January 2011, the FASB released Accounting Standards Update No. 2011-01 ("ASU 2011-01"), Receivables (Topic 310): Deferral of the Effective Date of Disclosures about Troubled Debt Restructurings in Update No. 2010-20, which deferred the disclosure requirements surrounding troubled debt restructurings. These disclosures are effective for the first reporting period beginning on or after June 15, 2011. We do not expect the disclosures related to troubled debt restructurings will have a material impact on our current financing receivable disclosures.

In April 2011, the FASB released Accounting Standards Update No. 2011-02 ("ASU 2011-02"), Receivables (Topic 310): A Creditor's Determination of Whether a Restructuring is a Troubled Debt Restructuring. ASU 2011-02 clarifies the guidance for determining whether a restructuring constitutes a troubled debt restructuring. In evaluating whether a restructuring constitutes a troubled debt restructuring, a creditor must conclude that 1) the restructuring constitutes a concession and 2) the debtor is experiencing financial difficulties. ASU 2011-02 also requires companies to disclose the troubled debt restructuring disclosures that were deferred by ASU 2011-01. The guidance in ASU 2011-02 is effective for public companies in the first reporting period beginning on or after June 15, 2011, but the amendment must be applied retrospectively to the beginning of the annual period of adoption. ASU 2011-02 is not expected to materially impact our condensed consolidated financial statements.

In May 2011, the FASB released Accounting Standards Update No. 2011-04 ("ASU 2011-04"), Fair Value Measurements (Topic 820): Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs. ASU 2011-04 is intended to improve the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with GAAP and International Financial Reporting Standards. The amendments in ASU 2011-04 clarify the FASB's intent about the application of existing fair value measurement requirements and change some requirements for measuring or disclosing information about fair value measurements. The provisions of ASU 2011-04 are effective for public companies in the first reporting period beginning after December 15, 2011. ASU 2011-04 is not expected to materially impact our condensed consolidated financial statements.

In June 2011, the FASB released Accounting Standards Update No. 2011-05 ("ASU 2011-05"), Comprehensive Income (Topic 220): Presentation of Comprehensive Income. ASU 2011-05 requires companies to present total comprehensive income, the components of net income, and the components of other comprehensive income in either a continuous statement or in two separate but consecutive statements. The amendments of ASU 2011-05 eliminate the option for companies to present the components of other comprehensive income within the statement of changes of stockholders' equity. The provisions of ASU 2011-05 are effective for public companies in fiscal years beginning after December 15, 2011. When adopted, ASU 2011-05 will change our presentation of comprehensive income within our condensed consolidated financial statements.

Equity And Cost Method Investments
Equity And Cost Method Investments
3. EQUITY AND COST METHOD INVESTMENTS

We have investments that are recorded under both the equity and cost methods. These investments are considered to be an integral part of our business and are strategically and operationally important to our overall results. Our equity and cost method investment balances recorded at June 30, 2011 and December 31, 2010 are as follows:

 

     June 30, 2011      December 31, 2010  

Equity method investments

   $ 205       $ 175   

Cost method investments

     73         70   
                 

Total investments

   $ 278       $ 245   
                 

During the second quarter of 2011, we contributed $20 million to a newly formed joint venture with Noble Investment Group ("Noble") in return for a 40% ownership interest in the venture (see Note 6). In addition, the Company and Noble agreed to invest in the strategic new development of Hyatt Place and Hyatt Summerfield Suites hotels in the United States. Under that agreement, we are required to contribute up to a maximum of 40% of the equity necessary to fund up to $80 million of such new development (see Note 11).

The three and six months ended June 30, 2010 includes $9 million in impairment charges in equity earnings (losses) from unconsolidated hospitality ventures related to a vacation ownership property.

Income from cost method investments included in our condensed consolidated statements of income for the three and six months ended June 30, 2011 and 2010 was insignificant.

 

The following table presents summarized financial information for all unconsolidated ventures in which we hold an investment that is accounted for under the equity method.

 

     For the Three Months Ended June 30,     For the Six Months Ended June 30,  
     2011      2010     2011      2010  

Total revenues

   $ 229       $ 204      $ 468       $ 409   

Gross operating profit

     71         67        147         129   

Income (loss) from continuing operations

     12         (6     23         (22

Net income (loss)

   $ 12       $ (6   $ 23       $ (22
                                  
Fair Value Measurement
Fair Value Measurement
4. FAIR VALUE MEASUREMENT

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). GAAP establishes a valuation hierarchy for prioritizing the inputs and the hierarchy places greater emphasis on the use of observable market inputs and less emphasis on unobservable inputs. When determining fair value, an entity is required to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of the hierarchy are as follows:

Level One— Fair values based on unadjusted quoted prices in active markets for identical assets and liabilities;

Level Two— Fair values based on quoted market prices for similar assets and liabilities in active markets, quoted prices in inactive markets for identical assets and liabilities, and inputs other than quoted market prices that are observable for the asset or liability;

Level Three— Fair values based on inputs that cannot be corroborated by observable market data and reflect the use of significant management judgment. Valuation techniques could include the use of discounted cash flow models and similar techniques.

We have various financial instruments that are measured at fair value including certain marketable securities and derivatives instruments. We currently do not have non-financial assets or non-financial liabilities that are required to be measured at fair value on a recurring basis.

We utilize the market approach and income approach for valuing our financial instruments. The market approach utilizes prices and information generated by market transactions involving identical or similar assets and liabilities and the income approach uses valuation techniques to convert future amounts (for example, cash flows or earnings) to a single present amount (discounted). For instances in which the inputs used to measure fair value fall into different levels of the fair value hierarchy, the fair value measurement has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of fair value assets and liabilities within the fair value hierarchy.

 

As of June 30, 2011 and December 31, 2010, we had the following financial assets and liabilities measured at fair value on a recurring basis:

 

                                 
    June 30, 2011     Quoted Prices in
Active Markets for
Identical Assets
(Level One)
    Significant Other
Observable Inputs
(Level Two)
    Significant
Unobservable
Inputs

(Level Three)
 
         

Marketable securities included in short-term investments, prepaids and other assets and other assets

                               

Mutual funds

  $ 257      $ 257      $ —        $ —     

Equity securities

    42        34        8        —     

U.S. government obligations

    104        —          104        —     

U.S. government agencies

    56        —          56        —     

Corporate debt securities

    459        —          459        —     

Mortgage-backed securities

    22        —          20        2   

Asset-backed securities

    9        —          9        —     

Other

    2        —          2        —     

Marketable securities recorded in cash and cash equivalents

                               

Interest bearing money market funds

    389        389        —          —     

Derivative instruments

                               

Interest rate swaps

    5        —          5        —     

Interest rate locks

    4        —          4        —     

Foreign currency forward contracts

    (1     —          (1     —     
         
    December 31, 2010     Quoted Prices in
Active Markets for
Identical Assets
(Level One)
    Significant Other
Observable Inputs
(Level Two)
    Significant
Unobservable
Inputs
(Level Three)
 
         

Marketable securities included in short-term investments, prepaids and other assets and other assets

                               

Mutual funds

  $ 244      $ 244      $ —        $ —     

Equity securities

    50        41        9        —     

U.S. government obligations

    101        —          101        —     

U.S. government agencies

    61        —          61        —     

Corporate debt securities

    451        —          451        —     

Mortgage-backed securities

    16        —          14        2   

Asset-backed securities

    11        —          11        —     

Other

    1        —          1        —     

Marketable securities recorded in cash and cash equivalents

                               

Interest bearing money market funds

    699        699        —          —     

Commercial paper

    3        —          3        —     

Derivative instruments

                               

Interest rate swaps

    4        —          4        —     

Foreign currency forward contracts

    (4     —          (4     —     

Our portfolio of marketable securities consists of various types of U.S. Treasury securities, mutual funds, common stock, and fixed income securities, including government and corporate bonds. The fair value of our mutual funds and certain equity securities were classified as Level One as they trade with sufficient frequency and volume to enable us to obtain pricing information on an ongoing basis. The remaining securities, except for certain mortgage-backed securities, were classified as Level Two due to the use and weighting of multiple market inputs being considered in the final price of the security. Market inputs include quoted market prices from active markets for identical securities, quoted market prices for identical securities in inactive markets, and quoted market prices in active and inactive markets for similar securities.

Included in our portfolio of marketable securities are investments in debt and equity securities classified as available for sale. At June 30, 2011 and December 31, 2010 these were as follows:

 

                                 
     June 30, 2011  
     Cost or Amortized
Cost
     Gross Unrealized
Gain
     Gross Unrealized
Loss
    Fair Value  

Corporate debt securities

   $ 380       $ 3       $ (3   $ 380   

U.S. government agencies

     19         —           —          19   

Equity securities

     9         —           (1     8   
                                    

Total

   $ 408       $ 3       $ (4   $   
                                    
   
     December 31, 2010  
     Cost or Amortized
Cost
     Gross Unrealized
Gain
     Gross Unrealized
Loss
    Fair Value  

Corporate debt securities

   $ 366       $ 2       $ (2   $ 366   

U.S. government agencies

     28         —           —          28   

Equity securities

     9         —           —          9   
                                    

Total

   $ 403       $ 2       $ (2   $ 403   
                                    

Gross realized gains and losses on available for sale securities were insignificant for the three and six months ended June 30, 2011 and 2010.

The table below summarizes available for sale fixed maturity securities by contractual maturity at June 30, 2011. Actual maturities may differ from contractual maturities because certain securities may be called or prepaid with or without call or prepayment penalties. Securities not due at a single date are allocated based on weighted average life. Although a portion of our available for sale fixed maturity securities mature after one year, we have chosen to classify the entire portfolio as current. The portfolio's primary objective is to maximize return, but it also is intended to provide liquidity to satisfy operating requirements, working capital purposes and strategic initiatives. Therefore, since these securities represent funds available for current operations, the entire investment portfolio is classified as current assets.

 

                 
     June 30, 2011  

Contractual Maturity

   Cost or Amortized
Cost
     Fair Value  
                   

Due in one year or less

   $ 248       $ 249   

Due in one to two years

     151         150   
                   
     

Total

   $ 399       $ 399   
                   

We invest a portion of our cash balance into short-term interest bearing money market funds that have a dollar-weighted average portfolio maturity of sixty days or less. Consequently, the balances are recorded in cash and cash equivalents. The funds are held with open-ended registered investment companies and the fair value of the funds is classified as Level One as we are able to obtain market available pricing information on an ongoing basis.

Our derivative instruments are foreign currency exchange rate instruments, interest rate swaps and interest rate lock instruments. The instruments are valued using an income approach with factors such as interest rates and yield curves, which represent market observable inputs and are generally classified as Level Two. Credit valuation adjustments may be made to ensure that derivatives are recorded at fair value. These adjustments include amounts to reflect counterparty credit quality and our nonperformance risk. As of June 30, 2011 and December 31, 2010, the credit valuation adjustments were not material. See Note 8 for further details on our derivative instruments.

Due to limited observability of market data and limited activity during the six months ended June 30, 2011 and 2010, we classified the fair value of certain of our mortgage-backed securities as Level Three. However, these securities are held within an investment-grade portfolio with many of these securities having a credit rating of AAA/Aaa.

 

During the three and six months ended June 30, 2011 and 2010, there were no transfers between levels of the fair value hierarchy. Our policy is to recognize transfers in and transfers out as of the end of each quarterly reporting period. As of January 1, 2011 and 2010, the balance of our Level Three mortgage backed securities was $2 million. During the three and six months ended June 30, 2011 and 2010, there were insignificant purchases, issuances, settlements and gains or losses (realized or unrealized) related to our Level Three mortgage backed securities. As of June 30, 2011 and 2010, the balance of our Level Three mortgage backed securities was $2 million.

 

           The amount of total gains or losses included in net gains (losses) and interest income from marketable securities held to fund operating programs due to the change in unrealized gains or losses relating to assets still held at the reporting date for the three and six months ended June 30, 2011 and 2010 were insignificant.

           The carrying amounts and fair values of our other financial instruments are as follows:

 

                                 
    Asset (Liability)  
    June 30, 2011     December 31, 2010  
    Carrying Amount     Fair Value     Carrying Amount     Fair Value  

Financing receivables

  $ 381      $ 383      $ 386      $ 392   

Debt, excluding capital lease obligations

    (558     (604     (558     (596

We estimated the fair value of financing receivables using discounted cash flow analysis based on current market inputs for similar types of arrangements. The primary sensitivity in these calculations is based on the selection of appropriate interest and discount rates. Fluctuations in these assumptions will result in different estimates of fair value. For further information on financing receivables see Note 5.

We estimated the fair value of our senior unsecured notes based on observable market data. We estimated the fair value of our mortgages, notes payable and other long-term debt instruments using discounted cash flow analysis based on current market inputs for similar types of arrangements. The primary sensitivity in these calculations is based on the selection of appropriate discount rates. Fluctuations in these assumptions will result in different estimates of fair value.

Financing Receivables
Financing Receivables
5. FINANCING RECEIVABLES

We define financing receivables as financing arrangements that represent a contractual right to receive money either on demand or on fixed or determinable dates and that are recognized as an asset on our condensed consolidated balance sheets. We record all financing receivables at amortized cost in current and long-term receivables. We recognize interest income as earned and provide an allowance for cancellations and defaults. We have divided our financing receivables into three portfolio segments based on the level at which we develop and document a systematic methodology to determine the allowance for credit losses. Based on their initial measurement, risk characteristics and our method for monitoring and assessing credit risk, we have determined the class of financing receivables to correspond to our identified portfolio segments. The three portfolio segments of financing receivables and their balances at June 30, 2011 and December 31, 2010 are as follows:

 

                 
    June 30, 2011     December 31, 2010  

Secured financing to hotel owners

  $ 325      $ 326   

Vacation ownership mortgage receivables at various interest rates with varying payments through 2018

    51        55   

Unsecured financing to hotel owners

    89        87   
                 
      465        468   

Less allowance for losses

    (84     (82

Less current portion included in receivables

    (26     (11
                 

Total long-term financing receivables

  $ 355      $ 375   
                 

Secured Financing to Hotel Owners—These financing receivables are senior, secured mortgage loans and are collateralized by underlying hotel properties currently in operation. These loans consist primarily of a $278 million mortgage loan receivable to an unconsolidated hospitality venture, which is accounted for under the equity method, and was formed to acquire ownership of a hotel property in Waikiki, Hawaii. This mortgage receivable has interest set at 30-day LIBOR+3.75% due monthly and a stated maturity date of July 2012 with one, one-year option to extend through 2013. We currently expect that the loan will be extended beyond 2012 and have classified it as long-term. Secured financing to hotel owners also includes financing provided to certain franchisees for the renovations and conversion of certain franchised hotels. These franchisee loans accrue interest at fixed rates ranging between 5.5% and 7.5%. Secured financing to hotel owners held by us as of June 30, 2011 are scheduled to mature as follows:

 

         

Year Ending December 31,

   Amount  

2011

   $ 1   

2012

     17   

2013

     278   

2014

     —     

2015

     29   

2016

     —     

Thereafter

     —     
          
   

Total secured financing to hotel owners

     325   

Less allowance

     (3
          

Net secured financing to hotel owners

   $ 322   
          

Vacation Ownership Mortgage Receivables—These financing receivables are comprised of various mortgage loans related to our financing of vacation ownership interval sales. As of June 30, 2011, the weighted-average interest rate on vacation ownership mortgage receivables was 14.0%. Vacation ownership mortgage receivables held by us as of June 30, 2011 are scheduled to mature as follows:

 

         

Year Ending December 31,

   Amount  

2011

   $ 3   

2012

     7   

2013

     8   

2014

     8   

2015

     8   

2016

     7   

Thereafter

     10   
          
   

Total vacation ownership mortgage receivables

     51   

Less allowance

     (9
          

Net vacation ownership mortgage receivables

   $ 42   
          

 

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. These financing receivables have stated maturities and interest rates. The repayment terms vary and may be dependent on the future cash flows of the hotel.

Analysis of Financing Receivables—The following table includes our aged analysis of past due financing receivables by portfolio segment, the gross balance of financing receivables on non-accrual status and the allowance for credit losses and the related investment balance as of June 30, 2011 and December 31, 2010, based on impairment method:

 

                                                 

Analysis of Financing Receivables

 

As of June 30, 2011

 
     Total
Past Due
     Current      Total
Financing
Receivable
     Receivables
on Non-
Accrual
Status
     Related
Allowance
for Credit
Losses
    Recorded
Investment >90
Days and
Accruing
 
             

Secured financing to hotel owners

   $ —         $ 325       $ 325       $ 40       $ (3   $ —     

Vacation ownership mortgage receivables

     3         48         51         —           (9     —     

Unsecured financing to hotel owners

     9         80         89         77         (72     —     
                                                      

Total

   $ 12       $ 453       $ 465       $ 117       $ (84   $ —     
                                                      
 

Analysis of Financing Receivables

 

As of December 31, 2010

 
     Total
Past Due
     Current      Total
Financing
Receivable
     Receivables
on Non-
Accrual
Status
     Related
Allowance
for Credit
Losses
    Recorded
Investment >90
Days and
Accruing
 
             

Secured financing to hotel owners

   $ —         $ 326       $ 326       $ 41       $ (4   $ —     

Vacation ownership mortgage receivables

     3         52         55         —           (10     1   

Unsecured financing to hotel owners

     13         74         87         69         (68     —     
                                                      

Total

   $ 16       $ 452       $ 468       $ 110       $ (82   $ 1   
                                                      

 

Credit Monitoring—On an ongoing basis, we monitor the credit quality of our financing receivables based on payment activity. We determine financing receivables to be past-due based on the contractual terms of each individual financing receivable agreement. Of our total past due amounts at June 30, 2011, an insignificant amount and $9 million of our vacation ownership mortgage receivables and our unsecured financing to hotel owners, respectively, are greater than 90 days past due. Of our total past due amounts at December 31, 2010, $1 million and $13 million of our vacation ownership mortgage receivables and our unsecured financing to hotel owners, respectively, are greater than 90 days past due.

We assess credit quality indicators based on whether financing receivables are performing or non-performing. We consider receivables non-performing if interest or principal is greater than 90 days past due for secured financing to hotel owners and unsecured financing to hotel owners or 120 days past due for vacation ownership mortgage receivables. Receivables not meeting these criteria are considered to be performing. If we consider a financing receivable to be non-performing or impaired, we will place the financing receivable on non-accrual status. We will recognize interest income when received for non-accruing finance receivables. Accrual of interest income is resumed when the receivable becomes contractually current and collection doubts are removed.

Allowance for Credit Losses—We individually assess all loans and other financing arrangements in the secured financing to hotel owners portfolio and in the unsecured financing to hotel owners portfolio for impairment. We assess the vacation ownership mortgage receivables portfolio for impairment on a collective basis.

 

The following table summarizes the activity in our financing receivables reserve for the three and six months ended June 30, 2011:

 

Allowance for Credit Losses

 

For the Three Months Ended June 30, 2011

 
     Beginning Balance
March 31, 2011
     Provisions      Other
Additions
     Write-offs     Recoveries      Ending Balance
June 30, 2011
 

Secured financing to hotel owners

   $ 3       $ —         $ —         $ —        $ —         $ 3   

Vacation ownership mortgage receivables

     10         —           —           (1     —           9   

Unsecured financing to hotel owners

     70         2         —           —          —           72   
                                                    

Total

   $ 83       $ 2       $ —         $ (1   $ —         $ 84   
                                                    

Allowance for Credit Losses

 

For the Six Months Ended June 30, 2011

 
     Beginning Balance
January 1, 2011
     Provisions      Other
Additions
     Write-offs     Recoveries      Ending Balance
June 30, 2011
 

Secured financing to hotel owners

   $ 4       $ —         $ —         $ (1   $ —         $ 3   

Vacation ownership mortgage receivables

     10         1         —           (2     —           9   

Unsecured financing to hotel owners

     68         3         1         —          —           72   
                                                    

Total

   $ 82       $ 4       $ 1       $ (3   $ —         $ 84   
                                                    

Amounts included in other additions represent currency translation on foreign currency denominated financing receivables.

For the three months ended June 30, 2010, we recorded insignificant provisions for our secured financing to hotel owners and unsecured financing to hotel owners and $1 million in provisions for our vacation ownership mortgage receivables. For the six months ended June 30, 2010, we recorded insignificant provisions for our secured financing to hotel owners and $1 million and $3 million in provisions for our vacation ownership mortgage receivables and unsecured financing to hotel owners, respectively.

Our unsecured financing to hotel owners consists primarily of receivables due on future contractual maturity dates. The payments under these contractual agreements are contingent upon future cash flows of the underlying hospitality properties. Although the majority of these payments are not past due, these receivables have been placed on non-accrual status and we have provided allowances for these owner receivables based on estimates of the future cash flows available for payment of these receivables. We consider the provisions on all of our portfolio segments to be adequate based on the economic environment and our assessment of the future collectability of the outstanding loans.

Impaired Loans—To determine whether an impairment has occurred, we evaluate the collectability of both interest and principal. A financing receivable is considered to be impaired when the Company determines that it is probable that it will not be able to collect all amounts due under the contractual terms. We do not record interest income for impaired receivables unless cash is received, in which case the payment is recorded to other income (loss), net in the accompanying condensed consolidated statements of income.

An analysis of impaired loans at June 30, 2011 and December 31, 2010, all of which had a related allowance recorded against them, was as follows:

 

Acquisitions, Dispositions, And Discontinued Operations
Acquisitions, Dispositions, And Discontinued Operations
6. ACQUISITIONS, DISPOSITIONS, AND DISCONTINUED OPERATIONS

We continually assess strategic acquisitions and dispositions to complement our current business.

Acquisitions

Woodfin Suites—During the second quarter of 2011, we acquired three Woodfin Suites properties in California for a total purchase price of approximately $77 million. We began managing these properties during the second quarter and have rebranded them as Hyatt Summerfield Suites.

The results of the Woodfin Suites properties have been included in the condensed consolidated financial statements from the date we acquired them. The following table presents information for the Woodfin Suites properties that is included in our condensed consolidated statements of income:

 

     Woodfin Suites'
operations included
in Hyatt's 2011
results
 

Revenues

   $ 2   

Income from continuing operations

     —     

The following unaudited pro forma consolidated results of operations for 2011 and 2010 assume that the acquisition of the Woodfin Suites properties was completed as of January 1, 2010:

 

     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Revenues

   $ 4       $ 4       $ 9       $ 8   

Income from continuing operations

     1         1         2         2   

Dispositions

Hyatt Place and Hyatt Summerfield Suites—During the second quarter of 2011, we sold six Hyatt Place and two Hyatt Summerfield Suites properties to a newly formed joint venture with Noble, in which the Company holds a 40% ownership interest. The properties were sold for a combined sale price of $110 million or $90 million, net of our $20 million contribution to the new joint venture (see Note 3). The sale resulted in a pretax loss of $2 million, which has been recognized in other income (loss), net on our condensed consolidated statements of income. In conjunction with the sale, we entered into a long-term franchise agreement for each property with the joint venture. The six Hyatt Place and two Hyatt Summerfield Suites hotels continue to be operated as Hyatt-branded hotels. The operating results and financial positions of these hotels prior to the sale remain within our owned and leased hotels segment.

 

Hyatt Regency Minneapolis—During the first quarter of 2011, we entered into an agreement with third parties to form a new joint venture, the purpose of which was to own and operate the Hyatt Regency Minneapolis. We contributed a fee simple interest in the Hyatt Regency Minneapolis to the joint venture as part of our equity interest subject to a $25 million loan to the newly formed joint venture. The loan was obtained during the quarter and the proceeds from the loan were retained by HHC. HHC has guaranteed the repayment of the loan (see Note 11). In conjunction with our contribution, we entered into a long-term management contract with the joint venture. The terms of the joint venture provide for capital contributions by the non-HHC partners that will be used to complete a full renovation of the Hyatt Regency Minneapolis.

Hyatt Regency Boston—During the first quarter of 2010, we sold the Hyatt Regency Boston for net proceeds of $113 million to Chesapeake Lodging Trust, an entity in which we own a 4.9% interest, resulting in a pretax gain of $6 million. The hotel continues to be operated as a Hyatt-branded hotel and we will continue to manage the hotel under a long-term management contract. The gain on sale was deferred and is being recognized in management and franchise fees over the term of the management contract within our North American management and franchising segment. The operations of the hotel prior to the sale remain within our owned and leased hotels segment.

Like-Kind Exchange Agreements

In conjunction with the sale of three of the Hyatt Place properties in the second quarter of 2011, we entered into a like-kind exchange agreement with an intermediary. Pursuant to the like-kind exchange agreement, the proceeds from the sales of these three hotels were placed into an escrow account administered by the intermediary. Therefore, we have classified the net proceeds of $35 million as restricted cash on our condensed consolidated balance sheet. Pursuant to the like-kind exchange agreement, the cash remains restricted for a maximum of 180 days from the date of execution pending consummation of the exchange transaction.

During the second half of 2010, we sold the Hyatt Deerfield, Grand Hyatt Tampa Bay and Hyatt Regency Greenville, and in conjunction with the sales we entered into like-kind exchange agreements with an intermediary. Pursuant to the like-kind exchange agreements, the proceeds from the sale of each hotel were placed into an escrow account administered by the intermediary. During the six months ended June 30, 2011, we released the net proceeds from the sales of Grand Hyatt Tampa Bay and Hyatt Regency Greenville of $56 million and $15 million, respectively, from restricted cash on our condensed consolidated balance sheet, as a like-kind exchange agreement was not consummated within applicable time periods. The net proceeds of $26 million from the sale of Hyatt Deerfield were utilized in a like-kind exchange agreement to acquire one of the Woodfin Suites properties.

Assets Held for Sale

During the fourth quarter of 2010, we committed to a plan to sell a Company owned airplane. As a result, we classified the value of the airplane as assets held for sale in the amount of $18 million at December 31, 2010. During the first quarter of 2011, we closed on the sale of the airplane to a third party for net proceeds of $18 million. The transaction resulted in a small pre-tax gain upon sale.

Discontinued Operations—The operating results, assets, and liabilities of the following business have been reported separately as discontinued operations in the condensed consolidated balance sheets and condensed consolidated statements of income. Upon disposition, we will not have any continuing involvement in these operations.

Amerisuites Orlando—During the first quarter of 2010, we committed to a plan to sell the Amerisuites Orlando property. As a result, we classified the assets and liabilities of this property as held for sale in 2010. Based on a valuation of the property, the Company determined the fair value of the property was below the book value of the assets. As such, a pre-tax impairment loss of approximately $4 million was recorded as part of the loss from discontinued operations during the first quarter of 2010. Revenues from this property for the three months ended and six months ended June 30, 2010 were insignificant and $1 million, respectively. The property was subsequently sold during the third quarter of 2010.

Residences — During the first quarter of 2010, we committed to a plan to sell an apartment building located adjacent to the Park Hyatt Washington D.C. (the "Residences"). As a result, we classified the assets and liabilities of this property as held for sale in 2010. During the second quarter of 2010, we closed on the sale of the Residences to an unrelated third party for net proceeds of $22 million. The transaction resulted in a pre-tax gain of $9 million upon sale as we will have no continuing involvement with the property. Revenues from this property for the three and six months ended June 30, 2010 were insignificant.

Goodwill And Intangible Assets
Goodwill And Intangible Assets
7. GOODWILL AND INTANGIBLE ASSETS

We review the carrying value of all our goodwill by comparing the carrying value of our reporting units to their fair values in a two-step process. We define a reporting unit at the individual property or business level. We are required to perform this comparison at least annually or more frequently if circumstances indicate that a possible impairment exists. When determining fair value in step one, we utilize internally developed discounted future cash flow models, third party appraisals and, if appropriate, current estimated net sales proceeds from pending offers. We then compare the estimated fair value to our carrying value. If the carrying value is in excess of the fair value, we must determine our implied fair value of goodwill to measure if any impairment charge is necessary.

Goodwill was $102 million at June 30, 2011 and December 31, 2010. During the three and six months ended June 30, 2011 and 2010, no impairment charges were recorded related to goodwill.

 

Definite lived intangible assets primarily include acquired management and franchise contracts, contract acquisition costs, and acquired lease rights. Franchise contracts are amortized on a straight-line basis over their contract terms, which are typically 20 years. Contract acquisition costs are generally amortized on a straight-line basis over the life of the management contracts, which range from approximately 5 to 40 years. Acquired lease rights are amortized on a straight-line basis over the lease term. Definite lived intangibles are tested for impairment whenever events or circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. There were no impairment charges related to intangible assets with definite lives during the three and six months ended June 30, 2011 and 2010.

 

The following is a summary of intangible assets at June 30, 2011 and December 31, 2010:

 

                         
     June 30, 2011     Weighted
Average Useful
Lives
     December 31, 2010  
       

Contract acquisition costs

   $ 156        23       $ 150   

Acquired lease rights

     135        114         130   

Franchise intangibles

     50        20         50   

Brand intangibles

     11        6         11   

Other

     7        14         8   
                           
       359                 349   

Accumulated amortization

     (77              (69
                           
       

Intangibles, net

   $ 282               $ 280   
                           

Amortization expense relating to intangible assets was as follows:

 

                                 
     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Amortization expense

   $ 5       $ 4       $ 8       $ 7   

 

Derivative Instruments
Derivative Instruments
8. DERIVATIVE INSTRUMENTS

It is our policy that derivative transactions are executed only to manage exposures arising in the normal course of business and not for the purpose of creating speculative positions or trading. As a result of the use of derivative instruments, we are exposed to the risk that counterparties to derivative contracts will fail to meet their contractual obligations. To mitigate the counterparty credit risk, we have a policy of only entering into contracts with carefully selected major financial institutions based upon their credit rating and other factors. Our derivative instruments do not contain credit-risk related contingent features.

 

All derivatives are recognized on the balance sheet at fair value. Changes in the fair value of a derivative that is qualified, designated and highly effective as a cash flow hedge are recorded in accumulated other comprehensive income (loss) on the balance sheet until they are reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. Changes in the fair value of a derivative that is qualified, designated and highly effective as a fair value hedge, along with the gain or loss on the hedged asset or liability that is attributable to the hedged risk are recorded in current earnings. Changes in the fair value of undesignated derivative instruments and the ineffective portion of designated derivative instruments are reported in current period earnings. Cash flows from designated derivative financial instruments are classified within the same category as the item being hedged on the statement of cash flows. Cash flows from undesignated derivative financial instruments are included in the investing category on the statement of cash flows.

Interest Rate Swap Agreements—In the normal course of business, we are exposed to the impact of interest rate changes due to our borrowing activities. Our objective is to manage the risk of interest rate changes on the results of operations, cash flows, and the market value of our debt by creating an appropriate balance between our fixed and floating-rate debt. Interest rate derivative transactions, including interest rate swaps, are entered to maintain a level of exposure to interest rates which the Company deems acceptable.

As of June 30, 2011 and 2010, we held four $25 million interest rate swap contracts, each of which expires on August 15, 2015 and effectively converted a total of $100 million of the $250 million of senior unsecured notes issued on August 10, 2009 with a maturity date of August 15, 2015 (the "2015 Notes") to floating rate debt based on three-month LIBOR plus a fixed rate component. The fixed rate component of each swap varies by contract, ranging from 2.68% to 2.9675%. The fixed to floating interest rate swaps were designated as a fair value hedge as their objective is to protect the 2015 Notes against changes in fair value due to changes in the three-month LIBOR interest rate. The swaps were designated as fair value hedges at inception and at June 30, 2011 and December 31, 2010 were highly effective in offsetting fluctuations in the fair value of the 2015 Notes. At June 30, 2011, the fixed to floating interest rate swaps were recorded within other assets at a value of $5 million, offset by a fair value adjustment to long-term debt of $5 million. At December 31, 2010, the fixed to floating interest rate swaps were recorded within other assets at a value of $4 million, offset by a fair value adjustment to long-term debt of $4 million.

Interest Rate Lock During the three months ended June 30, 2011, we entered into treasury-lock derivative instruments with $250 million of notional value to hedge a portion of the risk of changes in the benchmark interest rate associated with long-term debt we may issue in the future, as changes in the benchmark interest rate would result in variability in cash flows related to such debt. These derivative instruments were designated as cash flow hedges at inception and at June 30, 2011 were highly effective in offsetting fluctuations in the benchmark interest rate. Changes in the fair value relating to the effective portion of the lock are recorded in accumulated other comprehensive income (loss) and the corresponding fair value was included in prepaids and other assets.

Foreign Currency Exchange Rate Instruments—We transact business in various foreign currencies and utilize foreign currency forward contracts to offset the risks associated with the effects of certain foreign currency exposures. Our strategy is to have increases or decreases in our foreign currency exposures offset by gains or losses on the foreign currency forward contracts to mitigate the risks and volatility associated with foreign currency transaction gains or losses. These foreign currency exposures typically arise from intercompany loans and other intercompany transactions. Our foreign currency forward contracts generally settle within 12 months. We do not use these forward contracts for trading purposes. We do not designate these forward contracts as hedging instruments. Accordingly, we record the fair value of these contracts as of the end of our reporting period to our condensed consolidated balance sheets with changes in fair value recorded in our condensed consolidated statements of income within other income (loss), net for both realized and unrealized gains and losses. The balance sheet classification for the fair values of these forward contracts is to prepaids and other assets for unrealized gains and to accrued expenses and other current liabilities for unrealized losses.

 

The U.S. dollar equivalent of the notional amount of the outstanding forward contracts, the majority of which relate to intercompany loans, with terms of less than one year, is as follows (in U.S. dollars):

 

                 
     June 30, 2011      December 31, 2010  

Pound Sterling

   $ 63       $ 66   

Swiss Franc

     32         47   

Korean Won

     36         43   

Euro

     —           19   

Canadian Dollar

     9         —     

Australian Dollar

     1         1   
                   
     

Total notional amount of forward contracts

   $ 141       $ 176   
                   

Certain energy contracts at our hotel facilities include derivatives. However, we qualify for and have elected the normal purchases or sales exemption for these derivatives.

The effects of derivative instruments on our condensed consolidated financial statements were as follows as of June 30, 2011, December 31, 2010 and for the three and six months ended June 30, 2011 and 2010:

Fair Values of Derivative Instruments

 

                                         
    

Asset Derivatives

    

Liability Derivatives

 
    

Balance Sheet

Location

   June 30,
2011
     December 31,
2010
    

Balance Sheet

Location

   June 30,
2011
     December 31,
2010
 

Derivatives designated as hedging instruments

                                             
             

Interest rate swaps

   Other assets    $ 5       $ 4       Other long-term liabilities    $ —         $ —     
             

Interest rate locks

   Prepaids and other assets      4         —         Accrued expenses and other current liabilities      —           —     
             

Derivatives not designated as hedging instruments

                                             
             

Foreign currency forward contracts

   Prepaids and other assets      —           —         Accrued expenses and other current liabilities      1         4   
                                               
             

Total derivatives

        $ 9       $ 4            $ 1       $ 4   
                                               
Employee Benefit Plans
Employee Benefit Plans
9. EMPLOYEE BENEFIT PLANS

Defined Benefit Plans—We sponsor a frozen unfunded supplemental defined benefit executive retirement plan for certain former executives. Refer to the table below for costs related to this plan.

Defined Contribution Plans—We provide retirement benefits to certain qualified employees under the Retirement Savings Plan (a qualified plan under Internal Revenue Code Section 401(k)), the Field Retirement Plan (a nonqualified plan), and other similar plans. We record expenses related to the Retirement Savings Plan based on a percentage of qualified employee contributions on stipulated amounts; a substantial portion of these contributions are included in the other revenues from managed properties and other costs from managed properties lines in the condensed consolidated statements of income as the costs of these programs are largely related to employees located at lodging properties managed by us and are therefore paid for by the property owners. Refer to the table below for costs related to these plans.

Deferred Compensation Plans—Historically, we have provided nonqualified deferred compensation for certain employees through several different plans. These plans were funded through contributions to rabbi trusts. In 2010 these plans were consolidated into the Amended and Restated Hyatt Corporation Deferred Compensation Plan. Contributions and investment elections are determined by the employees. The Company also provides contributions according to a preapproved formula. A portion of these contributions relate to hotel property level employees, which are reimbursable to us and are included in the other revenues from managed properties and other costs from managed properties lines in the condensed consolidated statements of income. As of June 30, 2011 and December 31, 2010, the plans are fully funded in rabbi trusts. The assets of the plans are primarily invested in mutual funds, which are recorded in other assets in the condensed consolidated balance sheets. The related deferred compensation liability is recorded in other long-term liabilities. Refer to the table below for costs related to these plans.

Deferred Incentive Compensation Plans—The deferred incentive compensation plans consist of funded and unfunded defined contribution plans for certain executives. Awards were frozen starting in 2010 and vest over time. During the second quarter of 2010 the liabilities of the plans related to active employees were transferred to the Company's non-qualified deferred compensation plan. Refer to the table below for costs related to these plans.

The costs incurred for our employee benefit plans for the three and six months ended June 30, 2011 and 2010 were as follows:

 

     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Defined benefit plan

   $ 1       $ 1       $ 1       $ 1   

Defined contribution plans

     8         5         17         13   

Deferred compensation plans

     —           —           3         2   

Deferred incentive compensation plans

     1         1         1         1   
Income Taxes
Income Taxes
10. INCOME TAXES

The effective income tax rate from continuing operations for the three months ended June 30, 2011 and 2010 was -2.7% and 0.4% respectively. The effective income tax rate from continuing operations for the six months ended June 30, 2011 and 2010 was 9.2% and 39.1% respectively.

For the three months ended June 30, 2011, the effective tax rate differed from the U.S. statutory federal income tax rate of 35% primarily due to an increase in deferred tax assets of $12 million related to the release of a valuation allowance against certain foreign net operating losses. In addition, the reduced effective tax rate is due to foreign operations taxed at rates below the U.S. rate. For the six months ended June 30, 2011, the effective tax rate differed from the U.S. statutory federal income tax rate of 35% primarily due to an increase in deferred tax assets of $12 million related to the release of a valuation allowance against certain foreign net operating losses, and certain other adjustments to foreign deferred taxes of $2 million. In addition, the reduced effective tax rate is due to foreign operations taxed at rates below the U.S. rate. These items were partially offset by unrecognized tax benefits of $4 million (including $3 million of interest and penalties).

 

For the three months ended June 30, 2010, the effective tax rate differed from the U.S. statutory federal income tax rate of 35% primarily due to a net increase in deferred tax assets of $7 million related to the release of a valuation allowance against certain foreign net operating losses. For the six months ended June 30, 2010, the effective tax rate differed from the U.S. statutory federal income tax rate of 35% primarily due to a net increase in unrecognized tax benefits of $4 million (including $3 million of interest and penalties), an adjustment to deferred taxes of $2 million due to an international tax rate change and other adjustments to deferred taxes of $2 million. These items were offset by an increase in deferred tax assets of $7 million related to the release of a valuation allowance against certain foreign net operating losses.

For 2011, the tax on ordinary income has been calculated using an estimated annual effective tax rate. For 2010 we calculated the effective tax rate based on the year-to-date financials ("cut-off method") because we believed this method more accurately presented the effective tax rate for that period.

Total unrecognized tax benefits at June 30, 2011 and December 31, 2010 were $87 million and $89 million respectively, of which $51 million and $50 million respectively, would impact the effective tax rate if recognized.

Commitments And Contingencies
Commitments And Contingencies
11. COMMITMENTS AND CONTINGENCIES

In the ordinary course of business, we enter into various guarantees, commitments, surety bonds, and letter of credit agreements, which are discussed below:

Guarantees and Commitments—As of June 30, 2011, we are committed, under certain conditions, to loan or invest up to $581 million in various business ventures.

Included in the $581 million in commitments is our share of a hospitality venture's commitment to purchase a hotel within a to-be constructed building in New York City for a total purchase price of $375 million. The hospitality venture will be funded upon the purchase of the hotel and our share of the purchase price commitment is 66.67%. In accordance with the purchase agreement, we have agreed to fund a letter of credit as security towards this future purchase obligation. As of June 30, 2011, the letter of credit is valued at $5 million. The agreement stipulates that subsequent increases in the value of the letter of credit to $10 million and $50 million as well as the purchase of the completed property are each contingent upon the completion of certain contractual milestones. The $5 million funded letter of credit is included as part of our total letters of credit outstanding at June 30, 2011 and therefore netted against our future commitments amount disclosed above. For further discussion see the "Letters of Credit" section of this Note below.

Also included in the $581 million above is our commitment to invest in a joint venture in order to develop, own and operate a hotel property in the State of Hawaii. While our final investment is contingent upon the amount of debt financing placed by the joint venture, the maximum remaining commitment under the joint venture agreement at June 30, 2011 is $119 million. Further included in the $581 million is our commitment to invest $32 million in a newly formed joint venture to develop Hyatt Place and Hyatt Summerfield Suites hotels (see Note 3).

Certain of our hotel lease or management agreements contain performance tests that stipulate certain minimum levels of operating performance. These performance test clauses provide us the option to fund a shortfall in profit performance. If we choose not to fund the shortfall the hotel owner has the option to terminate the lease or management contract. As of June 30, 2011, an insignificant amount was recorded in accrued expenses and other current liabilities related to these performance test clauses.

Additionally, from time to time we may guarantee certain of our hotel owners certain levels of hotel profitability based on various metrics. We have management agreements where we are required to make payments based on specified thresholds and have recorded an insignificant amount and $1 million charge under one of these agreements in the three and six months ended June 30, 2011, respectively. Under a separate agreement, we had $4 million accrued as of June 30, 2011. The remaining maximum potential payments related to these agreements are $34 million.

We have entered into various loan, lease completion and repayment guarantees related to investments held in hotel operations. The maximum exposure under these agreements as of June 30, 2011 is $45 million. For a certain repayment guarantee related to one joint venture property, the Company has agreements with its partners that require each partner to pay a pro-rata portion of the guarantee based on each partner's ownership percentage. Assuming successful enforcement of these agreements with respect to this particular joint venture, our maximum exposure under the various agreements described above as of June 30, 2011 would be $41 million. As of June 30, 2011, the maximum exposure includes $25 million of a loan repayment agreement guarantee related to our contribution of Hyatt Regency Minneapolis to a newly formed joint venture (see Note 6).

Surety Bonds—Surety bonds issued on our behalf totaled $22 million at June 30, 2011, and primarily relate to workers' compensation, taxes, licenses, and utilities related to our lodging operations.

Letters of Credit—Letters of credit outstanding on our behalf as of June 30, 2011, totaled $79 million, the majority of which relate to our ongoing operations. Of the $79 million letters of credit outstanding, $65 million reduces the available capacity under the revolving credit facility.

Capital Expenditures—As part of our ongoing business operations, significant expenditures are required to complete renovation projects that have been approved.

Other—We act as general partner in various partnerships owning hotel facilities that are subject to mortgage indebtedness. These mortgage agreements generally limit the lender's recourse to security interests in assets financed and/or other assets of the partnership and/or the general partner(s) thereof. In conjunction with financing obtained for our unconsolidated hospitality ventures, we may provide standard indemnifications to the lender for loss, liability or damage occurring as a result of our actions or actions of the other joint venture owners.

We are subject from time to time to various claims and contingencies related to lawsuits, taxes, and environmental matters, as well as commitments under contractual obligations. Many of these claims are covered under current insurance programs, subject to deductibles. For those matters not covered by insurance we recognize liabilities associated with such commitments and contingencies when a loss is probable and reasonably estimable. Although the ultimate liability for these matters cannot be determined at this point, based on information currently available we do not expect that the ultimate resolution of such claims and litigation will have a material effect on our condensed consolidated financial statements.

Equity
Equity
12. EQUITY

Stockholders' Equity and Noncontrolling InterestThe following table details the equity activity for the six months ended June 30, 2011 and 2010, respectively.

 

    Stockholders'
equity
    Noncontrolling interests
in consolidated
subsidiaries
    Total equity  

Balance at January 1, 2011

  $ 5,118      $ 13      $ 5,131   

Net income (loss)

    47        (1     46   

Other comprehensive income

    40        —          40   

Purchase of company stock

    (396     —          (396

Issuance of common stock shares to directors

    1        —          1   

Issuance of common stock through Employee Stock Purchase Plan

    1        —          1   

Attribution of share based payments

    11        —          11   
                       

Balance at June 30, 2011

  $ 4,822      $ 12      $ 4,834   
                       

Balance at January 1, 2010

  $ 5,016      $ 24      $ 5,040   

Net income (loss)

    30        (1     29   

Other comprehensive income

    (16     —          (16

Purchase of shares in noncontrolling interests

    (3     (1     (4

Shares issued from treasury

    1        —          1   

Issuance of common stock shares to directors

    1        —          1   

Attribution of share based payments

    10        —          10   
                       

Balance at June 30, 2010

  $ 5,039      $ 22      $ 5,061   
                       

 

Comprehensive IncomeComprehensive income primarily relates to reported earnings (losses) and foreign currency translation.

Comprehensive income consists of the following:

 

    Three Months Ended June 30,     Six Months Ended June 30,  
    2011     2010     2011     2010  

Net Income

  $ 36      $ 24      $ 46      $ 29   

Other comprehensive income, net of taxes:

       

Foreign currency translation adjustments

    15        (19     38        (15

Unrealized gains on derivative instruments

    2        —          2        —     

Unrealized losses on available for sale securities

    —          (1     —          (1
                               

Total comprehensive income

  $ 53      $ 4      $ 86      $ 13   

Comprehensive loss attributable to noncontrolling interests

    1        1        1        1   
                               

Comprehensive income attributable to Hyatt Hotels Corporation

  $ 54      $ 5      $ 87      $ 14   
                               

Share RepurchaseDuring the second quarter of 2011, we repurchased 8,987,695 shares of Class B common stock for $44.03 per share, the closing price of the Company's Class A common stock on May 13, 2011, for an aggregate purchase price of approximately $396 million. This represented approximately 5.2% of the Company's total shares of common stock outstanding prior to the repurchase. The shares of Class B common stock were repurchased from trusts for the benefit of certain Pritzker family members in a privately-negotiated transaction and were retired, thereby reducing the total number of shares outstanding and reducing the shares of Class B common stock authorized and outstanding by the repurchased share amount.

 

Treasury Stock—During the second quarter of 2010, certain participants in the Deferred Compensation Plan had a one-time option to use their designated assets to purchase HHC Common Stock. The stock issued out of treasury stock included 30,805 shares for a total amount of $1 million.

Stock-Based Compensation
Stock-Based Compensation
13. STOCK-BASED COMPENSATION

As part of our long-term incentive plan, we award Stock Appreciation Rights ("SARs"), Restricted Stock Units ("RSUs") and Performance Share Units ("PSUs") to certain employees. Compensation expense and unearned compensation figures within this note exclude amounts related to employees of our managed hotels as this expense has been and will continue to be reimbursed by our third party hotel owners and is recorded on the lines other revenues from managed properties and other costs from managed properties. Compensation expense related to these awards for the three and six months ended June 30, 2011 and 2010 was as follows:

 

     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Stock appreciation rights

   $ 2       $ 3       $ 4       $ 6   

Restricted stock units

     3         2         6         3   

Performance share units

     —           —           1         —     

Stock Appreciation Rights—Each vested SAR gives the holder the right to the difference between the value of one share of our Class A common stock at the exercise date and the value of one share of our Class A common stock at the grant date. Vested SARs can be exercised over their life as determined by the plan. All SARs have a 10-year contractual term. The SARs are settled in shares of our Class A common stock. The Company is accounting for these SARs as equity instruments.

During the six months ended June 30, 2011, the Company granted 359,062 SARs to employees with a weighted average grant date fair value of $19.08. The fair value of each SAR was estimated based on the date of grant using the Black-Scholes-Merton option-valuation model.

Restricted Stock Units—The Company grants both RSUs that may be settled in stock and RSUs that may be settled in cash. Each vested stock-settled RSU will be settled with a single share of our Class A common stock. The value of the stock-settled RSUs was based on the closing stock price of our Class A common stock as of the grant date. We record compensation expense earned for RSUs on a straight-line basis from the date of grant. In certain situations we also grant cash-settled RSUs which are recorded as a liability instrument. The liability and related expense for cash-settled RSUs are insignificant as of, and for the three and six months ended, June 30, 2011. During the six months ended June 30, 2011, the Company granted a total of 498,809 RSUs (an insignificant portion of which are cash-settled RSUs) to employees which, with respect to stock-settled RSUs, had a weighted average grant date fair value of $41.66.

Performance Share Units—In March 2011 the Compensation Committee of our Board of Directors granted to certain executive officers PSUs, which are restricted stock units that vest based on satisfaction of certain performance targets. The number of PSUs that will ultimately vest and be paid out in Class A common stock will range from 0 to 200 percent of the target amount stated in each executive's award agreement based upon the performance of the Company relative to the applicable performance target. The target number of PSUs granted total 99,660 with a weighted average grant date fair value of $41.74. The performance period is a three year period beginning January 1, 2011 and ending December 31, 2013. The PSUs will vest at the end of the performance period only if the performance target is met; there is no interim performance metric.

Our total unearned compensation for our stock-based compensation programs as of June 30, 2011 was $20 million for SARs, $36 million for RSUs and $3 million for PSUs, which will be recorded to compensation expense over the next ten years.

Related-Party Transactions
Related-Party Transactions
14. RELATED-PARTY TRANSACTIONS

In addition to those included elsewhere in the notes to the condensed consolidated financial statements, related-party transactions entered into by us are summarized as follows:

Leases—Our corporate headquarters have been located at the Hyatt Center in Chicago, Illinois since 2005. The Hyatt Center was owned by a related party until December 20, 2010, when it was sold to an unrelated third party. We recorded, in selling, general and administrative expenses, $3 million and $5 million during the three and six months ended June 30, 2010 for rent, taxes and our share of operating expenses and shared facility costs under the lease while the building was owned by a related party. A subsidiary of Hyatt Hotels Corporation holds a master lease for a portion of the Hyatt Center and entered into sublease agreements with certain related parties. Two of these sublease agreements, entered into at the same time as our master lease and at the same rate as our master lease, end in December 2011. As of June 30, 2011, we have tentatively agreed to a new sublease agreement with a related party. The new sublease agreement contemplates sublease income paid to Hyatt that represents market rates and is approximately $5 million less than the rental payments that we are required to make under the master lease. As a result, we recognized a $5 million loss on the transaction, which is recorded in other income (loss), net on the condensed consolidated statements of income. Future sublease income for this space from related parties is $17 million.

Legal Services—A partner in a law firm that provided services to us throughout the six months ended June 30, 2011 and 2010 is the brother-in-law of our Executive Chairman. We incurred legal fees with this firm of $1 million, for each of the three months ended June 30, 2011 and 2010, respectively. We incurred legal fees with this firm of $2 million and $3 million, for the six months ended June 30, 2011 and 2010, respectively. Legal fees, when expensed, are included in selling, general and administrative expenses. As of June 30, 2011 and December 31, 2010, we had $1 million and insignificant amounts, respectively, due to the law firm.

Other Services—A member of our board of directors who was appointed in 2009 is a partner in a firm whose affiliates own hotels from which we received management and franchise fees of $1 million and $1 million during the three months ended June 30, 2011 and 2010, respectively, and $3 million and $3 million during the six months ended June 30, 2011 and 2010, respectively. As of June 30, 2011 and December 31, 2010 we had $1 million and insignificant receivables, respectively, due from these properties.

 Equity Method Investments—We have equity method investments in entities that own properties for which we provide management and/or franchise services and receive fees. We recorded fees of $10 million and $9 million for the three months ended June 30, 2011 and 2010, respectively. We recorded fees of $18 million and $17 million for the six months ended June 30, 2011 and 2010, respectively. As of June 30, 2011 and December 31, 2010, we had receivables due from these properties of $10 million and $8 million, respectively. In addition, in some cases we provide loans or guarantees (see Note 11) to these entities. Our ownership interest in these equity method investments generally varies from 8 to 50 percent.

 

Share Repurchase During the second quarter of 2011, we repurchased 8,987,695 shares of Class B common stock for $44.03 per share, the closing price of the Company's Class A common stock on May 13, 2011, for an aggregate purchase price of approximately $396 million. This represented approximately 5.2% of the Company's total shares of common stock outstanding prior to the repurchase. The shares of Class B common stock were repurchased from trusts for the benefit of certain Pritzker family members in a privately-negotiated transaction and were retired, thereby reducing the total number of shares outstanding and reducing the shares of Class B common stock authorized and outstanding by the repurchased share amount.

 

Segment Information
Segment Information
15. SEGMENT INFORMATION

Our operating segments are components of the business which are managed discretely and for which discrete financial information is reviewed regularly by the chief operating decision maker to assess performance and make decisions regarding the allocation of resources. Our chief operating decision maker is the Chief Executive Officer. We define our reportable segments as follows:

Owned and Leased Hotels—This segment derives its earnings from owned and leased hotel properties located predominantly in North America but also from certain international locations and for purposes of segment Adjusted EBITDA, includes our pro rata share of the Adjusted EBITDA of our unconsolidated hospitality ventures, based on our ownership percentage of each venture.

North American Management and Franchising—This segment derives its earnings from services provided including hotel management and licensing of our family of brands to franchisees located in the U.S., Canada and the Caribbean. This segment's revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin and includes in costs and expenses these reimbursed costs. These costs relate primarily to payroll costs at managed properties where the Company is the employer. These revenues and costs are recorded on the lines other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees that are collected from the Company's owned hotels, which are eliminated in consolidation.

International Management and Franchising—This segment derives its earnings from services provided including hotel management and licensing of our family of brands to franchisees located in countries outside of the U.S., Canada and the Caribbean. This segment's revenues also include the reimbursement of costs incurred on behalf of managed hotel property owners and franchisees with no added margin and includes in costs and expenses these reimbursed costs. These costs relate primarily to reservations, marketing and IT costs. These revenues and costs are recorded on the lines other revenues from managed properties and other costs from managed properties, respectively. The intersegment revenues relate to management fees that are collected from the Company's owned hotels, which are eliminated in consolidation.

Our chief operating decision maker evaluates performance based on each segment's Adjusted EBITDA. We define Adjusted EBITDA as net income attributable to Hyatt Hotels Corporation plus our pro-rata share of unconsolidated hospitality ventures Adjusted EBITDA before equity earnings (losses) from unconsolidated hospitality ventures; asset impairments; other income (loss), net; discontinued operations, net of tax; net loss attributable to noncontrolling interests; depreciation and amortization; interest expense; and provision for income taxes.

The table below shows summarized consolidated financial information by segment. Included within Corporate and other are unallocated corporate expenses, revenues and expenses on our vacation ownership properties, and the results of our co-branded credit card launched in 2010.

 

                                 
(in millions)    Three Months Ended June 30,     Six Months Ended June 30,  
     2011     2010     2011     2010  

North American Management and Franchising

                                

Revenues

   $ 397      $ 361      $ 789      $ 708   

Intersegment Revenues (a)

     15        17        29        33   

Adjusted EBITDA

     44        41        84        72   

Depreciation and Amortization

     3        2        6        5   
         

International Management and Franchising

                                

Revenues

     54        50        105        98   

Intersegment Revenues (a)

     5        5        9        9   

Adjusted EBITDA

     22        18        42        32   

Depreciation and Amortization

     1        1        1        1   
         

Owned and Leased Hotels

                                

Revenues

     484        483        916        934   

Adjusted EBITDA

     114        103        189        185   

Depreciation and Amortization

     66        61        132        126   
         

Corporate and other

                                

Revenues

     21        17        39        32   

Adjusted EBITDA (b)

     (29     (27     (55     (42

Depreciation and Amortization

     2        2        4        4   
         

Eliminations (a)

                                

Revenues

     (20     (22     (38     (42

Adjusted EBITDA

     —          —          —          —     

Depreciation and Amortization

     —          —          —          —     
         

TOTAL

                                

Revenues

   $ 936      $ 889      $ 1,811      $ 1,730   

Adjusted EBITDA

     151        135        260        247   

Depreciation and Amortization

     72        66        143        136   

 

The table below provides a reconciliation of our consolidated Adjusted EBITDA to EBITDA and a reconciliation of EBITDA to net income attributable to Hyatt Hotels Corporation for the three and six months ended June 30, 2011 and 2010.

 

                                 
     Three Months Ended June 30,     Six Months Ended June 30,  
     2011     2010     2011     2010  
         

Adjusted EBITDA

   $ 151      $ 135      $ 260      $ 247   

Equity earnings (losses) from unconsolidated hospitality ventures

     2        (11     5        (19

Asset impairments

     (1     (3     (1     (3

Other income (loss), net

     (9     (6     (6     10   

Discontinued operations, net of tax

     —          5        —          3   

Net loss attributable to noncontrolling interests

     1        1        1        1   
         

Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA

     (22     (18     (37     (32
                                  

EBITDA

     122        103        222        207   

Depreciation and amortization

     (72     (66     (143     (136

Interest expense

     (14     (12     (27     (24

(Provision) benefit for income taxes

     1        —          (5     (17
                                  

Net income attributable to Hyatt Hotels Corporation

   $ 37      $ 25      $ 47      $ 30   
                                  
Earnings Per Share
Earnings Per Share
16. EARNINGS PER SHARE

The calculation of basic and diluted earnings per share, including a reconciliation of the numerator and denominator, are as follows:

 

     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Numerator:

           

Income from continuing operations

   $ 36       $ 19       $ 46       $ 26   

Gain from discontinued operations

     —           5         —           3   
                                   

Net income

   $ 36       $ 24       $ 46       $ 29   

Net loss attributable to noncontrolling interests

   $ 1       $ 1       $ 1       $ 1   
                                   

Net income attributable to Hyatt Hotels Corporation

   $ 37       $ 25       $ 47       $ 30   
                                   

Denominator:

           

Basic weighted average shares outstanding:

             174,118,518                 174,040,620   

Share-based compensation

     231,715         139,439         272,713         63,203   
                                   

Diluted weighted average shares outstanding

             174,257,957                 174,103,823   
                                   

Basic Earnings Per Share:

           

Income from continuing operations

   $ 0.21       $ 0.11       $ 0.27       $ 0.15   

Gain from discontinued operations

     —           0.03         —           0.02   
                                   

Net income

   $ 0.21       $ 0.14       $ 0.27       $ 0.17   

Net loss attributable to noncontrolling interests

   $ 0.01       $ 0.00       $ 0.01       $ 0.00   
                                   

Net income attributable to Hyatt Hotels Corporation

   $ 0.22       $ 0.14       $ 0.28       $ 0.17   
                                   

Diluted Earnings Per Share:

           

Income from continuing operations

   $ 0.21       $ 0.11       $ 0.27       $ 0.15   

Gain from discontinued operations

     —           0.03         —           0.02   
                                   

Net income

   $ 0.21       $ 0.14       $ 0.27       $ 0.17   

Net loss attributable to noncontrolling interests

   $ 0.01       $ 0.00       $ 0.01       $ 0.00   
                                   

Net income attributable to Hyatt Hotels Corporation

   $ 0.22       $ 0.14       $ 0.28       $ 0.17   
                                   

The computations of diluted net income per share for the three and six months ended June 30, 2011 and 2010 do not include the following shares of Class A common stock assumed to be issued as stock-settled SARs, RSUs and PSUs because they are anti-dilutive.

 

       Three Months Ended June 30,        Six Months Ended June 30,  
       2011        2010        2011        2010  

Stock-settled SARs

       273,320           219,500           150,400           145,900   

RSUs

       49,000           756,400           4,440           832,700   

PSUs

       —             —             —             —     
Other Income (Loss), Net
Other Income (Loss), Net
17. OTHER INCOME (LOSS), NET

Other income (loss), net includes interest income, gains (losses) on other marketable securities and foreign currency losses; including gains (losses) on foreign currency exchange rate instruments (see Note 8). The table below provides a reconciliation of the components in other income, net for the three and six months ended June 30, 2011 and 2010, respectively:

 

                                 
     Three Months Ended June 30,     Six Months Ended June 30,  
     2011     2010     2011     2010  
         

Interest income

   $ 6      $ 5      $ 11      $ 10   

Gains (losses) on other marketable securities

     (6     (9     (7     2   

Foreign currency losses

     (3     (1     (4     (2

Loss on sale of real estate

     (2     —          (2     —     

Other

     (4     (1     (4     —     
                                  

Other income (loss), net

   $ (9   $ (6   $ (6   $ 10   
                                  
Subsequent Event
Subsequent Event
18. SUBSEQUENT EVENT

On July 13, 2011, Hyatt Corporation, a subsidiary of the Company, entered into an Asset Purchase Agreement (the "Purchase Agreement") with LodgeWorks, L.P. and its private equity partners (collectively, "LodgeWorks") pursuant to which we agreed to acquire twenty-four (24) hotels located throughout the United States operating under the Hotel Sierra®, Avia®, Hyatt Place® and Hyatt Summerfield Suites® brand names. In addition to the 24 hotels, Hyatt Corporation also agreed to acquire certain additional assets including LodgeWorks' rights under certain hotel management and license agreements and certain assets related to the operation of the purchased hotels, including all rights to the service marks Avia and Hotel Sierra. The aggregate purchase price for these assets is approximately $802 million in cash. The contemplated transaction is pursuant to the terms and subject to the conditions set forth in the Purchase Agreement.

We expect the purchase of all relevant assets to close during the third quarter of 2011, although the purchases of certain assets may close at later dates. The consummation of the transactions contemplated by the Purchase Agreement are subject to the satisfaction of certain customary closing conditions. In addition, we may terminate the Purchase Agreement in our sole discretion at any time within 75 days of the execution of the Purchase Agreement. As a result, there can be no assurance that any of the transactions contemplated by the Purchase Agreement will close, or if they do, when such closings will occur.

 

Equity And Cost Method Investments (Tables)
     June 30, 2011      December 31, 2010  

Equity method investments

   $ 205       $ 175   

Cost method investments

     73         70   
                 

Total investments

   $ 278       $ 245   
                 
     For the Three Months Ended June 30,     For the Six Months Ended June 30,  
     2011      2010     2011      2010  

Total revenues

   $ 229       $ 204      $ 468       $ 409   

Gross operating profit

     71         67        147         129   

Income (loss) from continuing operations

     12         (6     23         (22

Net income (loss)

   $ 12       $ (6   $ 23       $ (22
                                  
Fair Value Measurement (Tables)
                                 
    June 30, 2011     Quoted Prices in
Active Markets for
Identical Assets
(Level One)
    Significant Other
Observable Inputs
(Level Two)
    Significant
Unobservable
Inputs

(Level Three)
 
         

Marketable securities included in short-term investments, prepaids and other assets and other assets

                               

Mutual funds

  $ 257      $ 257      $ —        $ —     

Equity securities

    42        34        8        —     

U.S. government obligations

    104        —          104        —     

U.S. government agencies

    56        —          56        —     

Corporate debt securities

    459        —          459        —     

Mortgage-backed securities

    22        —          20        2   

Asset-backed securities

    9        —          9        —     

Other

    2        —          2        —     

Marketable securities recorded in cash and cash equivalents

                               

Interest bearing money market funds

    389        389        —          —     

Derivative instruments

                               

Interest rate swaps

    5        —          5        —     

Interest rate locks

    4        —          4        —     

Foreign currency forward contracts

    (1     —          (1     —     
         
    December 31, 2010     Quoted Prices in
Active Markets for
Identical Assets
(Level One)
    Significant Other
Observable Inputs
(Level Two)
    Significant
Unobservable
Inputs
(Level Three)
 
         

Marketable securities included in short-term investments, prepaids and other assets and other assets

                               

Mutual funds

  $ 244      $ 244      $ —        $ —     

Equity securities

    50        41        9        —     

U.S. government obligations

    101        —          101        —     

U.S. government agencies

    61        —          61        —     

Corporate debt securities

    451        —          451        —     

Mortgage-backed securities

    16        —          14        2   

Asset-backed securities

    11        —          11        —     

Other

    1        —          1        —     

Marketable securities recorded in cash and cash equivalents

                               

Interest bearing money market funds

    699        699        —          —     

Commercial paper

    3        —          3        —     

Derivative instruments

                               

Interest rate swaps

    4        —          4        —     

Foreign currency forward contracts

    (4     —          (4     —     
                                 
     June 30, 2011  
     Cost or Amortized
Cost
     Gross Unrealized
Gain
     Gross Unrealized
Loss
    Fair Value  

Corporate debt securities

   $ 380       $ 3       $ (3   $ 380   

U.S. government agencies

     19         —           —          19   

Equity securities

     9         —           (1     8   
                                    

Total

   $ 408       $ 3       $ (4   $   
                                    
   
     December 31, 2010  
     Cost or Amortized
Cost
     Gross Unrealized
Gain
     Gross Unrealized
Loss
    Fair Value  

Corporate debt securities

   $ 366       $ 2       $ (2   $ 366   

U.S. government agencies

     28         —           —          28   

Equity securities

     9         —           —          9   
                                    

Total

   $ 403       $ 2       $ (2   $ 403   
                                    
                 
     June 30, 2011  

Contractual Maturity

   Cost or Amortized
Cost
     Fair Value  
                   

Due in one year or less

   $ 248       $ 249   

Due in one to two years

     151         150   
                   
     

Total

   $ 399       $ 399   
                   
                                 
    Asset (Liability)  
    June 30, 2011     December 31, 2010  
    Carrying Amount     Fair Value     Carrying Amount     Fair Value  

Financing receivables

  $ 381      $ 383      $ 386      $ 392   

Debt, excluding capital lease obligations

    (558     (604     (558     (596
Financing Receivables (Tables)
                 
    June 30, 2011     December 31, 2010  

Secured financing to hotel owners

  $ 325      $ 326   

Vacation ownership mortgage receivables at various interest rates with varying payments through 2018

    51        55   

Unsecured financing to hotel owners

    89        87   
                 
      465        468   

Less allowance for losses

    (84     (82

Less current portion included in receivables

    (26     (11
                 

Total long-term financing receivables

  $ 355      $ 375   
                 
         

Year Ending December 31,

   Amount  

2011

   $ 1   

2012

     17   

2013

     278   

2014

     —     

2015

     29   

2016

     —     

Thereafter

     —     
          
   

Total secured financing to hotel owners

     325   

Less allowance

     (3
          

Net secured financing to hotel owners

   $ 322   
          
         

Year Ending December 31,

   Amount  

2011

   $ 3   

2012

     7   

2013

     8   

2014

     8   

2015

     8   

2016

     7   

Thereafter

     10   
          
   

Total vacation ownership mortgage receivables

     51   

Less allowance

     (9
          

Net vacation ownership mortgage receivables

   $ 42   
          
                                                 

Analysis of Financing Receivables

 

As of June 30, 2011

 
     Total
Past Due
     Current      Total
Financing
Receivable
     Receivables
on Non-
Accrual
Status
     Related
Allowance
for Credit
Losses
    Recorded
Investment >90
Days and
Accruing
 
             

Secured financing to hotel owners

   $ —         $ 325       $ 325       $ 40       $ (3   $ —     

Vacation ownership mortgage receivables

     3         48         51         —           (9     —     

Unsecured financing to hotel owners

     9         80         89         77         (72     —     
                                                      

Total

   $ 12       $ 453       $ 465       $ 117       $ (84   $ —     
                                                      
 

Analysis of Financing Receivables

 

As of December 31, 2010

 
     Total
Past Due
     Current      Total
Financing
Receivable
     Receivables
on Non-
Accrual
Status
     Related
Allowance
for Credit
Losses
    Recorded
Investment >90
Days and
Accruing
 
             

Secured financing to hotel owners

   $ —         $ 326       $ 326       $ 41       $ (4   $ —     

Vacation ownership mortgage receivables

     3         52         55         —           (10     1   

Unsecured financing to hotel owners

     13         74         87         69         (68     —     
                                                      

Total

   $ 16       $ 452       $ 468       $ 110       $ (82   $ 1   
                                                      

 

Allowance for Credit Losses

 

For the Three Months Ended June 30, 2011

 
     Beginning Balance
March 31, 2011
     Provisions      Other
Additions
     Write-offs     Recoveries      Ending Balance
June 30, 2011
 

Secured financing to hotel owners

   $ 3       $ —         $ —         $ —        $ —         $ 3   

Vacation ownership mortgage receivables

     10         —           —           (1     —           9   

Unsecured financing to hotel owners

     70         2         —           —          —           72   
                                                    

Total

   $ 83       $ 2       $ —         $ (1   $ —         $ 84   
                                                    

Allowance for Credit Losses

 

For the Six Months Ended June 30, 2011

 
     Beginning Balance
January 1, 2011
     Provisions      Other
Additions
     Write-offs     Recoveries      Ending Balance
June 30, 2011
 

Secured financing to hotel owners

   $ 4       $ —         $ —         $ (1   $ —         $ 3   

Vacation ownership mortgage receivables

     10         1         —           (2     —           9   

Unsecured financing to hotel owners

     68         3         1         —          —           72   
                                                    

Total

   $ 82       $ 4       $ 1       $ (3   $ —         $ 84   
                                                    
Acquisitions, Dispositions, And Discontinued Operations (Tables)
     Woodfin Suites'
operations included
in Hyatt's 2011
results
 

Revenues

   $ 2   

Income from continuing operations

     —     
     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Revenues

   $ 4       $ 4       $ 9       $ 8   

Income from continuing operations

     1         1         2         2   
Goodwill And Intangible Assets (Tables)
                         
     June 30, 2011     Weighted
Average Useful
Lives
     December 31, 2010  
       

Contract acquisition costs

   $ 156        23       $ 150   

Acquired lease rights

     135        114         130   

Franchise intangibles

     50        20         50   

Brand intangibles

     11        6         11   

Other

     7        14         8   
                           
       359                 349   

Accumulated amortization

     (77              (69
                           
       

Intangibles, net

   $ 282               $ 280   
                           
                                 
     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Amortization expense

   $ 5       $ 4       $ 8       $ 7   
Derivative Instruments (Tables)
                 
     June 30, 2011      December 31, 2010  

Pound Sterling

   $ 63       $ 66   

Swiss Franc

     32         47   

Korean Won

     36         43   

Euro

     —           19   

Canadian Dollar

     9         —     

Australian Dollar

     1         1   
                   
     

Total notional amount of forward contracts

   $ 141       $ 176   
                   
                                         
    

Asset Derivatives

    

Liability Derivatives

 
    

Balance Sheet

Location

   June 30,
2011
     December 31,
2010
    

Balance Sheet

Location

   June 30,
2011
     December 31,
2010
 

Derivatives designated as hedging instruments

                                             
             

Interest rate swaps

   Other assets    $ 5       $ 4       Other long-term liabilities    $ —         $ —     
             

Interest rate locks

   Prepaids and other assets      4         —         Accrued expenses and other current liabilities      —           —     
             

Derivatives not designated as hedging instruments

                                             
             

Foreign currency forward contracts

   Prepaids and other assets      —           —         Accrued expenses and other current liabilities      1         4   
                                               
             

Total derivatives

        $ 9       $ 4            $ 1       $ 4   
                                               
Employee Benefit Plans (Tables)
Schedule Of Costs Incurred For Employee Benefit Plans
     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Defined benefit plan

   $ 1       $ 1       $ 1       $ 1   

Defined contribution plans

     8         5         17         13   

Deferred compensation plans

     —           —           3         2   

Deferred incentive compensation plans

     1         1         1         1   
Equity (Tables)
    Stockholders'
equity
    Noncontrolling interests
in consolidated
subsidiaries
    Total equity  

Balance at January 1, 2011

  $ 5,118      $ 13      $ 5,131   

Net income (loss)

    47        (1     46   

Other comprehensive income

    40        —          40   

Purchase of company stock

    (396     —          (396

Issuance of common stock shares to directors

    1        —          1   

Issuance of common stock through Employee Stock Purchase Plan

    1        —          1   

Attribution of share based payments

    11        —          11   
                       

Balance at June 30, 2011

  $ 4,822      $ 12      $ 4,834   
                       

Balance at January 1, 2010

  $ 5,016      $ 24      $ 5,040   

Net income (loss)

    30        (1     29   

Other comprehensive income

    (16     —          (16

Purchase of shares in noncontrolling interests

    (3     (1     (4

Shares issued from treasury

    1        —          1   

Issuance of common stock shares to directors

    1        —          1   

Attribution of share based payments

    10        —          10   
                       

Balance at June 30, 2010

  $ 5,039      $ 22      $ 5,061   
                       
    Three Months Ended June 30,     Six Months Ended June 30,  
    2011     2010     2011     2010  

Net Income

  $ 36      $ 24      $ 46      $ 29   

Other comprehensive income, net of taxes:

       

Foreign currency translation adjustments

    15        (19     38        (15

Unrealized gains on derivative instruments

    2        —          2        —     

Unrealized losses on available for sale securities

    —          (1     —          (1
                               

Total comprehensive income

  $ 53      $ 4      $ 86      $ 13   

Comprehensive loss attributable to noncontrolling interests

    1        1        1        1   
                               

Comprehensive income attributable to Hyatt Hotels Corporation

  $ 54      $ 5      $ 87      $ 14   
                               
Stock-Based Compensation (Tables)
Compensation Expense Related To Long-Term Incentive Plan
     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Stock appreciation rights

   $ 2       $ 3       $ 4       $ 6   

Restricted stock units

     3         2         6         3   

Performance share units

     —           —           1         —     
Segment Information (Tables)
                                 
(in millions)    Three Months Ended June 30,     Six Months Ended June 30,  
     2011     2010     2011     2010  

North American Management and Franchising

                                

Revenues

   $ 397      $ 361      $ 789      $ 708   

Intersegment Revenues (a)

     15        17        29        33   

Adjusted EBITDA

     44        41        84        72   

Depreciation and Amortization

     3        2        6        5   
         

International Management and Franchising

                                

Revenues

     54        50        105        98   

Intersegment Revenues (a)

     5        5        9        9   

Adjusted EBITDA

     22        18        42        32   

Depreciation and Amortization

     1        1        1        1   
         

Owned and Leased Hotels

                                

Revenues

     484        483        916        934   

Adjusted EBITDA

     114        103        189        185   

Depreciation and Amortization

     66        61        132        126   
         

Corporate and other

                                

Revenues

     21        17        39        32   

Adjusted EBITDA (b)

     (29     (27     (55     (42

Depreciation and Amortization

     2        2        4        4   
         

Eliminations (a)

                                

Revenues

     (20     (22     (38     (42

Adjusted EBITDA

     —          —          —          —     

Depreciation and Amortization

     —          —          —          —     
         

TOTAL

                                

Revenues

   $ 936      $ 889      $ 1,811      $ 1,730   

Adjusted EBITDA

     151        135        260        247   

Depreciation and Amortization

     72        66        143        136   

 

                                 
     Three Months Ended June 30,     Six Months Ended June 30,  
     2011     2010     2011     2010  
         

Adjusted EBITDA

   $ 151      $ 135      $ 260      $ 247   

Equity earnings (losses) from unconsolidated hospitality ventures

     2        (11     5        (19

Asset impairments

     (1     (3     (1     (3

Other income (loss), net

     (9     (6     (6     10   

Discontinued operations, net of tax

     —          5        —          3   

Net loss attributable to noncontrolling interests

     1        1        1        1   
         

Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA

     (22     (18     (37     (32
                                  

EBITDA

     122        103        222        207   

Depreciation and amortization

     (72     (66     (143     (136

Interest expense

     (14     (12     (27     (24

(Provision) benefit for income taxes

     1        —          (5     (17
                                  

Net income attributable to Hyatt Hotels Corporation

   $ 37      $ 25      $ 47      $ 30   
                                  
Earnings Per Share (Tables)
     Three Months Ended June 30,      Six Months Ended June 30,  
     2011      2010      2011      2010  

Numerator:

           

Income from continuing operations

   $ 36       $ 19       $ 46       $ 26   

Gain from discontinued operations

     —           5         —           3   
                                   

Net income

   $ 36       $ 24       $ 46       $ 29   

Net loss attributable to noncontrolling interests

   $ 1       $ 1       $ 1       $ 1   
                                   

Net income attributable to Hyatt Hotels Corporation

   $ 37       $ 25       $ 47       $ 30   
                                   

Denominator:

           

Basic weighted average shares outstanding:

             174,118,518                 174,040,620   

Share-based compensation

     231,715         139,439         272,713         63,203   
                                   

Diluted weighted average shares outstanding

             174,257,957                 174,103,823   
                                   

Basic Earnings Per Share:

           

Income from continuing operations

   $ 0.21       $ 0.11       $ 0.27       $ 0.15   

Gain from discontinued operations

     —           0.03         —           0.02   
                                   

Net income

   $ 0.21       $ 0.14       $ 0.27       $ 0.17   

Net loss attributable to noncontrolling interests

   $ 0.01       $ 0.00       $ 0.01       $ 0.00   
                                   

Net income attributable to Hyatt Hotels Corporation

   $ 0.22       $ 0.14       $ 0.28       $ 0.17   
                                   

Diluted Earnings Per Share:

           

Income from continuing operations

   $ 0.21       $ 0.11       $ 0.27       $ 0.15   

Gain from discontinued operations

     —           0.03         —           0.02   
                                   

Net income

   $ 0.21       $ 0.14       $ 0.27       $ 0.17   

Net loss attributable to noncontrolling interests

   $ 0.01       $ 0.00       $ 0.01       $ 0.00   
                                   

Net income attributable to Hyatt Hotels Corporation

   $ 0.22       $ 0.14       $ 0.28       $ 0.17   
                                   
       Three Months Ended June 30,        Six Months Ended June 30,  
       2011        2010        2011        2010  

Stock-settled SARs

       273,320           219,500           150,400           145,900   

RSUs

       49,000           756,400           4,440           832,700   

PSUs

       —             —             —             —     
Other Income (Loss), Net (Tables)
Schedule of Other Income (Loss), Net
                                 
     Three Months Ended June 30,     Six Months Ended June 30,  
     2011     2010     2011     2010  
         

Interest income

   $ 6      $ 5      $ 11      $ 10   

Gains (losses) on other marketable securities

     (6     (9     (7     2   

Foreign currency losses

     (3     (1     (4     (2

Loss on sale of real estate

     (2     —          (2     —     

Other

     (4     (1     (4     —     
                                  

Other income (loss), net

   $ (9   $ (6   $ (6   $ 10   
                                  
Equity And Cost Method Investments (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Jun. 30, 2010
6 Months Ended
Jun. 30, 2010
Jun. 30, 2011
Dec. 31, 2010
3 Months Ended
Jun. 30, 2011
Hyatt Place And Hyatt Summerfield Suites Development Joint Venture [Member]
Jun. 30, 2011
Hyatt Place And Hyatt Summerfield Suites Joint Venture [Member]
Contribution to investment
 
 
$ 205 
$ 175 
 
$ 20 
Ownership percentage in the joint venture
 
 
 
 
 
40.00% 
Required amount of funding by Hyatt to maintain ownership percentage
 
 
 
 
40.00% 
 
Maximum investment by joint venture
 
 
 
 
80 
 
Equity earnings losses from unconsolidated hospitality ventures impairments
$ 9 
$ 9 
 
 
 
 
Equity And Cost Method Investments (Equity And Cost Method Investment Balances) (Details) (USD $)
In Millions
Jun. 30, 2011
Dec. 31, 2010
Equity And Cost Method Investments
 
 
Equity method investments
$ 205 
$ 175 
Cost method investments
73 
70 
Total investments
$ 278 
$ 245 
Equity And Cost Method Investments (Summarized Financial Information) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Equity And Cost Method Investments
 
 
 
 
Total revenues
$ 229 
$ 204 
$ 468 
$ 409 
Gross operating profit
71 
67 
147 
129 
Income (loss) from continuing operations
12 
(6)
23 
(22)
Net income (loss)
$ 12 
$ (6)
$ 23 
$ (22)
Fair Value Measurement (Narrative) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Jun. 30, 2011
Mortgage-Backed Securities [Member]
Dec. 31, 2010
Mortgage-Backed Securities [Member]
Jun. 30, 2010
Mortgage-Backed Securities [Member]
Dec. 31, 2009
Mortgage-Backed Securities [Member]
Transfers into (out of) Level Three
$ 0 
$ 0 
$ 0 
$ 0 
 
 
 
 
Balance of Level Three securities
 
 
 
 
$ 2 
$ 2 
$ 2 
$ 2 
Fair Value Measurement (Assets And Liabilities Measured At Fair Value On A Recurring Basis) (Details) (USD $)
In Millions
Jun. 30, 2011
Dec. 31, 2010
Mutual Funds [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
$ 257 
$ 244 
Mutual Funds [Member] |
Quoted Prices In Active Markets For Identical Assets (Level 1) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
257 
244 
Equity Securities [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
42 
50 
Equity Securities [Member] |
Quoted Prices In Active Markets For Identical Assets (Level 1) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
34 
41 
Equity Securities [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
U.S. Government Obligations [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
104 
101 
U.S. Government Obligations [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
104 
101 
U.S. Government Agencies [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
56 
61 
U.S. Government Agencies [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
56 
61 
Corporate Debt Securities [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
459 
451 
Corporate Debt Securities [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
459 
451 
Mortgage-Backed Securities [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
22 
16 
Mortgage-Backed Securities [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
20 
14 
Mortgage-Backed Securities [Member] |
Significant Unobservable Inputs (Level 3) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
Asset-Backed Securities [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
11 
Asset-Backed Securities [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
11 
Other [Member] |
Total Fair Value [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
Other [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities included in short-term investments, prepaids and other assets and other assets
Interest Bearing Money Market Funds [Member] |
Total Fair Value [Member]
 
 
Marketable securities recorded in cash and cash equivalents
389 
699 
Interest Bearing Money Market Funds [Member] |
Quoted Prices In Active Markets For Identical Assets (Level 1) [Member]
 
 
Marketable securities recorded in cash and cash equivalents
389 
699 
Commercial Paper [Member] |
Total Fair Value [Member]
 
 
Marketable securities recorded in cash and cash equivalents
 
Commercial Paper [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Marketable securities recorded in cash and cash equivalents
 
Interest Rate Swap [Member] |
Total Fair Value [Member]
 
 
Derivative instruments
Interest Rate Swap [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Derivative instruments
Interest Rate Locks [Member] |
Total Fair Value [Member]
 
 
Derivative instruments
 
Interest Rate Locks [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Derivative instruments
 
Foreign Currency Forward Contracts [Member] |
Total Fair Value [Member]
 
 
Derivative instruments
(1)
(4)
Foreign Currency Forward Contracts [Member] |
Significant Other Observable Inputs (Level 2) [Member]
 
 
Derivative instruments
$ (1)
$ (4)
Fair Value Measurement (Investments Classified As Available For Sale) (Details) (USD $)
In Millions
Jun. 30, 2011
Dec. 31, 2010
Cost or amortized cost
$ 408 
$ 403 
Gross unrealized gain
Gross unrealized loss
(4)
(2)
Fair Value
407 
403 
Corporate Debt Securities [Member]
 
 
Cost or amortized cost
380 
366 
Gross unrealized gain
Gross unrealized loss
(3)
(2)
Fair Value
380 
366 
U.S. Government Agencies [Member]
 
 
Cost or amortized cost
19 
28 
Fair Value
19 
28 
Equity Securities [Member]
 
 
Cost or amortized cost
Gross unrealized loss
(1)
 
Fair Value
$ 8 
$ 9 
Fair Value Measurement (Available For Sale Securities By Contractual Maturity) (Details) (USD $)
In Millions
Jun. 30, 2011
Fair Value Measurement
 
Due in one year or less, Cost or Amortized Cost
$ 248 
Due in one to two years, Cost or Amortized Cost
151 
Total, Cost or Amortized Cost
399 
Due in one year or less, Fair Value
249 
Due in one to two years, Fair Value
150 
Total, Fair Value
$ 399 
Fair Value Measurement (Carrying Amounts And Fair Values Of Other Financial Instruments) (Details) (USD $)
In Millions
Jun. 30, 2011
Dec. 31, 2010
Fair Value Measurement
 
 
Financing receivables, Carrying Amount
$ 381 
$ 386 
Financing receivables, Fair Value
383 
392 
Debt, excluding capital lease obligations, Carrying Amount
(558)
(558)
Debt, excluding capital lease obligations, Fair Value
$ (604)
$ (596)
Financing Receivables (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
3 Months Ended
Jun. 30, 2011
2011
2011
Secured Financing To Hotel Owners [Member]
2011
Secured Financing To Hotel Owners [Member]
Maximum [Member]
2011
Secured Financing To Hotel Owners [Member]
Minimum [Member]
3 Months Ended
Jun. 30, 2011
Unsecured Financing To Hotel Owners [Member]
2011
Unsecured Financing To Hotel Owners [Member]
2010
Unsecured Financing To Hotel Owners [Member]
Dec. 31, 2010
Unsecured Financing To Hotel Owners [Member]
3 Months Ended
Jun. 30, 2010
Vacation Ownership Mortgage Receivables [Member]
2011
Vacation Ownership Mortgage Receivables [Member]
2010
Vacation Ownership Mortgage Receivables [Member]
Dec. 31, 2010
Vacation Ownership Mortgage Receivables [Member]
Mortgage loan receivable
 
 
$ 278 
 
 
 
 
 
 
 
 
 
 
Provisions for vacation ownership mortgage receivables and unsecured financing
 
 
 
 
 
Mortgage receivable interest rate in addition to LIBOR
 
 
3.75% 
 
 
 
 
 
 
 
 
 
 
Mortgage receivable maturity date
 
 
July 2012 
 
 
 
 
 
 
 
 
 
 
Fixed interest rate for franchisee loans
 
 
 
7.50% 
5.50% 
 
 
 
 
 
 
 
 
Weighted average interest rate on vacation ownership mortgages receivable
 
 
 
 
 
 
 
 
 
 
14.00% 
 
 
Past due amount
 
 
 
 
 
$ 9 
$ 9 
 
$ 13 
 
 
 
$ 1 
Financing Receivables (Schedule Of Financing Receivables) (Details) (USD $)
In Millions
Jun. 30, 2011
Mar. 31, 2011
Dec. 31, 2010
Total Financing Receivable
$ 465 
 
$ 468 
Less allowance
(84)
(83)
(82)
Less current portion included in receivables
(26)
 
(11)
Total long-term financing receivables
355 
 
375 
Unsecured Financing To Hotel Owners [Member]
 
 
 
Total Financing Receivable
89 
 
87 
Less allowance
(72)
(70)
(68)
Secured Financing To Hotel Owners [Member]
 
 
 
Total Financing Receivable
325 
 
326 
Less allowance
(3)
 
(4)
Vacation Ownership Mortgage Receivables [Member]
 
 
 
Total Financing Receivable
51 
 
55 
Less allowance
$ (9)
 
$ (10)
Financing Receivables (Schedule Of Secured Financing To Hotel Owners) (Details) (USD $)
In Millions
Jun. 30, 2011
Mar. 31, 2011
Dec. 31, 2010
Financing receivables
$ 465 
 
$ 468 
Less allowance
(84)
(83)
(82)
Secured Financing To Hotel Owners [Member]
 
 
 
2011
 
 
2012
17 
 
 
2013
278 
 
 
2014
 
 
 
2015
29 
 
 
2016
 
 
 
Thereafter
 
 
 
Financing receivables
325 
 
326 
Less allowance
(3)
 
(4)
Net secured financing to hotel owners
$ 322 
 
 
Financing Receivables (Schedule Of Vacation Ownership Mortgages Receivables) (Details) (USD $)
In Millions
Jun. 30, 2011
Mar. 31, 2011
Dec. 31, 2010
Financing receivables
$ 465 
 
$ 468 
Less allowance
(84)
(83)
(82)
Vacation Ownership Mortgage Receivables [Member]
 
 
 
2011
 
 
2012
 
 
2013
 
 
2014
 
 
2015
 
 
2016
 
 
Thereafter
10 
 
 
Financing receivables
51 
 
55 
Less allowance
(9)
 
(10)
Net vacation ownership mortgage receivables
$ 42 
 
 
Financing Receivables (Analysis Of Financing Receivables) (Details) (USD $)
In Millions
Jun. 30, 2011
Mar. 31, 2011
Dec. 31, 2010
Total past due
$ 12 
 
$ 16 
Current
453 
 
452 
Total Financing Receivable
465 
 
468 
Receivables on non-accrual status
117 
 
110 
Less allowance
(84)
(83)
(82)
Recorded investment >90 days and accruing
 
 
Unsecured Financing To Hotel Owners [Member]
 
 
 
Total past due
 
13 
Current
80 
 
74 
Total Financing Receivable
89 
 
87 
Receivables on non-accrual status
77 
 
69 
Less allowance
(72)
(70)
(68)
Recorded investment >90 days and accruing
 
 
 
Secured Financing To Hotel Owners [Member]
 
 
 
Current
325 
 
326 
Total Financing Receivable
325 
 
326 
Receivables on non-accrual status
40 
 
41 
Less allowance
(3)
 
(4)
Recorded investment >90 days and accruing
 
 
 
Vacation Ownership Mortgage Receivables [Member]
 
 
 
Total past due
 
Current
48 
 
52 
Total Financing Receivable
51 
 
55 
Less allowance
(9)
 
(10)
Recorded investment >90 days and accruing
 
 
$ 1 
Financing Receivables (Allowance For Credit Losses) (Details) (USD $)
In Millions
6 Months Ended
Jun. 30,
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
3 Months Ended
Jun. 30, 2011
6 Months Ended
Jun. 30, 2011
3 Months Ended
Jun. 30, 2011
Unsecured Financing To Hotel Owners [Member]
2011
Unsecured Financing To Hotel Owners [Member]
2010
Unsecured Financing To Hotel Owners [Member]
2011
Secured Financing To Hotel Owners [Member]
Mar. 31, 2011
Secured Financing To Hotel Owners [Member]
2011
Vacation Ownership Mortgage Receivables [Member]
2010
Vacation Ownership Mortgage Receivables [Member]
2011
Vacation Ownership Mortgage Receivables [Member]
2010
Vacation Ownership Mortgage Receivables [Member]
Beginning Balance
$ 83 
$ 82 
$ 70 
$ 68 
 
$ 4 
$ 3 
$ 10 
 
$ 10 
 
Provisions
 
 
 
Other Additions
 
 
 
 
 
 
 
 
 
Write Offs
(1)
(3)
 
 
 
(1)
 
(1)
 
(2)
 
Ending total allowance
$ 84 
$ 84 
$ 72 
$ 72 
 
$ 3 
$ 3 
$ 9 
 
$ 9 
 
Financing Receivables (Impaired Loans) (Details) (USD $)
In Millions
6 Months Ended
Jun. 30, 2011
12 Months Ended
Dec. 31, 2010
Unsecured Financing To Hotel Owners [Member]
 
 
Recorded Investment
$ 49 
$ 47 
Unpaid Principal Balance
45 
43 
Related Allowance
(44)
(42)
Average Recorded Investment
48 
45 
Secured Financing To Hotel Owners [Member]
 
 
Recorded Investment
40 
41 
Unpaid Principal Balance
40 
40 
Related Allowance
(3)
(4)
Average Recorded Investment
40 
40 
Interest Income Recognized
$ 1 
$ 2 
Acquisitions, Dispositions, And Discontinued Operations (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
3 Months Ended
Jun. 30, 2011
3 Months Ended
Mar. 31, 2011
2011
2010
Dec. 31, 2010
Jun. 30, 2011
Hyatt Place And Hyatt Summerfield Suites Joint Venture [Member]
Jun. 30, 2011
Woodfin Suites [Member]
Mar. 31, 2011
Hyatt Regency Minneapolis [Member]
2011
Hyatt Deerfield [Member]
2011
Hyatt Tampa Bay [Member]
2011
Hyatt Regency Greenville [Member]
1 Months Ended
Mar. 31, 2010
Hyatt Regency Boston [Member]
6 Months Ended
Jun. 30, 2010
Amerisuites Orlando [Member]
Mar. 31, 2010
Amerisuites Orlando [Member]
3 Months Ended
Jun. 30, 2011
Hyatt Place And Hyatt Summerfield Suites [Member]
6 Months Ended
Jun. 30, 2011
Hyatt Place And Hyatt Summerfield Suites [Member]
3 Months Ended
Jun. 30, 2010
Hyatt Washington D.C. [Member]
6 Months Ended
Jun. 30, 2010
Hyatt Washington D.C. [Member]
Total purchase price
 
 
 
 
 
 
$ 77 
 
 
 
 
 
 
 
 
 
 
 
Proceeds from sales of real estate
 
 
 
 
 
 
 
 
 
 
 
 
 
 
110 
 
 
 
Loss on sales of real estate
(2)
 
(2)
 
 
 
 
 
 
 
 
 
 
 
(2)
(2)
 
 
Equity method investments
205 
 
205 
 
175 
20 
 
 
 
 
 
 
 
 
 
 
 
 
Ownership percentage in the joint venture
 
 
 
 
 
40.00% 
 
 
 
 
 
 
 
 
 
 
 
 
Carrying value of loan
 
 
 
 
 
 
 
25 
 
 
 
 
 
 
 
 
 
 
Proceeds from sales of real estate
 
 
90 
113 
 
 
 
 
 
 
 
113 
 
 
90 
 
 
 
Proceeds from sale of discontinued operations
 
 
 
22 
 
 
 
 
 
 
 
 
 
 
 
 
22 
 
Ownership interest in Chesapeake Lodging Trust
 
 
 
 
 
 
 
 
 
 
 
4.90% 
 
 
 
 
 
 
Pre-tax gain on disposal of assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gain on disposal of discontinued operation, pre-tax
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Real estate sale proceeds transferred to escrow as restricted cash
 
 
(35)
(113)
 
 
 
 
 
 
 
 
 
 
35 
 
 
 
Maximum days cash remains restricted from the date of execution
 
 
 
 
 
 
 
 
 
 
 
 
 
 
180 
 
 
 
Net sales proceeds released from restricted cash
 
 
 
 
 
 
 
 
(26)
(56)
(15)
 
 
 
 
 
 
 
Impairment loss from discontinued operations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets held for sale
 
 
 
 
18 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net proceeds from sale
 
18 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenues from discontinued operations properties
 
 
 
 
 
 
 
 
 
 
 
 
$ 1 
 
 
 
$ 0 
$ 0 
Acquisitions, Dispositions, And Discontinued Operations (Results Of Acquisition) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Revenues
$ 936 
$ 889 
$ 1,811 
$ 1,730 
Income from continuing operations
36 
19 
46 
26 
Woodfin Suites [Member]
 
 
 
 
Revenues
 
 
 
Income from continuing operations
 
 
 
 
Acquisitions, Dispositions, And Discontinued Operations (Pro Forma Consolidated Results Of Operations) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Acquisitions, Dispositions, And Discontinued Operations
 
 
 
 
Revenues
$ 4 
$ 4 
$ 9 
$ 8 
Income from continuing operations
$ 1 
$ 1 
$ 2 
$ 2 
Goodwill And Intangible Assets (Narrative) (Details) (USD $)
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Dec. 31, 2010
Goodwill And Intangible Assets
 
 
 
 
 
Goodwill
$ 102,000,000 
 
$ 102,000,000 
 
$ 102,000,000 
Typical franchise contract term
 
 
20 
 
 
Life of management contracts, minimum
 
 
 
 
Life of management contracts, maximum
 
 
40 
 
 
Goodwill impairment charges
 
Definite lived intangible asset impairment charges
$ 0 
$ 0 
$ 0 
$ 0 
 
Goodwill and Intangible Assets (Summary of Intangible Assets) (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30,
Jun. 30, 2011
Dec. 31, 2010
2011
Contract Acquisition Costs [Member]
2011
Acquired Lease Rights [Member]
2011
Franchise Intangibles [Member]
2011
Brand Intangibles [Member]
2011
Other Intangibles [Member]
Contract acquisition costs
$ 156 
$ 150 
 
 
 
 
 
Acquired lease rights
135 
130 
 
 
 
 
 
Franchise intangibles
50 
50 
 
 
 
 
 
Brand intangibles
11 
11 
 
 
 
 
 
Other
 
 
 
 
 
Gross intangibles, total
359 
349 
 
 
 
 
 
Accumulated amortization
(77)
(69)
 
 
 
 
 
Intangibles, net
$ 282 
$ 280 
 
 
 
 
 
Weighted Average Useful Lives
 
 
23 
114 
20 
14 
Goodwill And Intangible Assets (Amortization Expense) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Goodwill And Intangible Assets
 
 
 
 
Amortization expense
$ 5 
$ 4 
$ 8 
$ 7 
Derivative Instruments (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30,
2011
2010
12 Months Ended
Dec. 31, 2010
Number of interest rate swap contracts
 
Derivative expiration date
Aug. 15, 2015 
Aug. 15, 2015 
 
Notional amount of contracts
$ 25 
$ 25 
 
Amount of note hedged
100 
100 
 
Senior unsecured note
250 
250 
 
Fixed rate range, lower end
2.68% 
 
 
Fixed rate range, higher end
2.9675% 
 
 
Derivative assets
 
Change in fair value of long term debt
 
Interest Rate Locks [Member]
 
 
 
Notional value of treasury-lock derivative instruments
$ 250 
 
 
Derivative Instruments (US Dollar Equivalent Of The Notional Amount Of Forward Contracts) (Details) (Foreign Currency Forward Contracts [Member], USD $)
In Millions
Jun. 30, 2011
Dec. 31, 2010
Notional amount of foreign currency derivatives
$ 141 
$ 176 
Pound Sterling [Member]
 
 
Notional amount of foreign currency derivatives
63 
66 
Swiss Franc [Member]
 
 
Notional amount of foreign currency derivatives
32 
47 
Korean Won [Member]
 
 
Notional amount of foreign currency derivatives
36 
43 
Euro [Member]
 
 
Notional amount of foreign currency derivatives
 
19 
Canadian Dollar [Member]
 
 
Notional amount of foreign currency derivatives
 
Australian Dollar [Member]
 
 
Notional amount of foreign currency derivatives
$ 1 
$ 1 
Derivative Instruments (Fair Value Of Derivative Instruments) (Details) (USD $)
In Millions
Jun. 30, 2011
Dec. 31, 2010
Total derivative assets
$ 9 
$ 4 
Total derivative liabilities
Interest Rate Locks [Member] |
Designated as Hedging Instrument [Member] |
Prepaids and Other Assets [Member]
 
 
Total derivative assets
 
Designated as Hedging Instrument [Member] |
Interest Rate Swap [Member] |
Other Assets [Member]
 
 
Total derivative assets
Foreign Currency Forward Contracts [Member] |
Derivatives Not Designated as Hedging Instruments [Member] |
Accrued Expenses and Other Current Liabilities [Member]
 
 
Total derivative liabilities
$ 1 
$ 4 
Derivative Instruments (Effect Of Derivative Instruments On Income) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Interest Rate Locks [Member] |
Cash Flow Hedges [Member] |
Accumulated Other Comprehensive Loss [Member]
 
 
 
 
Amount of gain (loss) recognized in accumulated other comprehensive income (loss) on derivative (effective portion)
$ 4 
 
$ 4 
 
Interest Rate Locks [Member] |
Cash Flow Hedges [Member] |
Interest Expense [Member]
 
 
 
 
Amount of gain (loss) reclassified from accumulated other comprehensive income (loss) into income (effective portion)
 
 
 
 
Interest Rate Locks [Member] |
Cash Flow Hedges [Member] |
Other Income (Loss), Net [Member]
 
 
 
 
Amount of gain (loss) recognized in income on derivative (ineffective portion and amount excluded from effectiveness testing)
 1
 1
 1
 1
Fair Value Hedges [Member] |
Interest Rate Swap [Member] |
Other Income (Loss) Net [Member]
 
 
 
 
Gains (losses) on derivatives
2
2
2
2
Losses on borrowings
(2)2
(5)2
(1)2
(5)2
Foreign Currency Forward Contracts [Member] |
Derivatives Not Designated as Hedging Instruments [Member]
 
 
 
 
Gains (losses) on derivatives
 
 
Foreign Currency Forward Contracts [Member] |
Derivatives Not Designated as Hedging Instruments [Member] |
Other Income (Loss) Net [Member]
 
 
 
 
Gains (losses) on derivatives
$ (6)
$ 10 
$ (8)
$ 22 
Employee Benefit Plans (Schedule Of Costs Incurred For Employee Benefit Plans) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Defined Benefit Plan [Member]
 
 
 
 
Cost incurred for employee benefit plans
$ 1 
$ 1 
$ 1 
$ 1 
Defined Contribution Plans [Member]
 
 
 
 
Cost incurred for employee benefit plans
17 
13 
Deferred Compensation Plans [Member]
 
 
 
 
Cost incurred for employee benefit plans
 
 
Deferred Incentive Compensation Plans [Member]
 
 
 
 
Cost incurred for employee benefit plans
$ 1 
$ 1 
$ 1 
$ 1 
Income Taxes (Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Dec. 31, 2010
Income Taxes
 
 
 
 
 
Effective tax rate
(2.70%)
0.40% 
9.20% 
39.10% 
 
U.S. statutory federal income tax rate
35.00% 
35.00% 
35.00% 
35.00% 
 
Adjustment to foreign deferred taxes
 
 
$ 2 
 
 
Change in deferred tax asset valuation allowance
12 
12 
 
Increase in unrecognized tax benefits
 
 
 
Interest and penalties
 
 
 
Effect of a change in foreign enacted tax rate
 
 
 
 
Other adjustments to deferred tax assets
 
 
 
 
Total unrecognized tax benefits
87 
 
87 
 
89 
Amount of unrecognized tax benefits that would affect the tax rate if recognized
$ 51 
 
$ 51 
 
$ 50 
Commitments And Contingencies (Guarantees And Commitments Narrative) (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2011
Commitments
$ 581 
Joint Venture New York [Member]
 
Commitments
375 
Purchase price commitment, percentage
66.67% 
Debt instrument value
Debt instrument first subsequent increase value
10 
Debt instrument second subsequent increase value
50 
Joint Venture Hawaii [Member]
 
Maximum exposure
119 
Joint Venture Minneapolis [Member]
 
Maximum exposure
25 
Hyatt Place And Hyatt Summerfield Suites Joint Venture [Member]
 
Maximum exposure
32 
Loan, Lease Completion And Repayment Guarantees [Member]
 
Maximum exposure
45 
Successful enforcement of various guarantee agreements
41 
Profitability Guarantees [Member]
 
Charge in period
Accrual for guarantee
Maximum exposure
$ 34 
Commitments And Contingencies (Surety Bonds And Letters Of Credit Narrative) (Details) (USD $)
In Millions
6 Months Ended
Jun. 30, 2011
Commitments And Contingencies
 
Surety bonds
$ 22 
Letters of credit outstanding
79 
Letters of credit that reduce the available capacity under the revolving credit facility
$ 65 
Equity (Narrative) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended
Jun. 30, 2010
6 Months Ended
Jun. 30, 2010
3 Months Ended
Jun. 30, 2011
Common Class B
Stock repurchased
 
 
8,987,695 
Cost per share
 
 
$ 44.03 
Share repurchase, value
 
 
$ 396 
Percent repurchased
 
 
5.20% 
Treasury stock issued, shares
30,805 
 
 
Treasury stock issued, value
$ 1 
$ 1 
 
Equity (Schedule Of Stockholders' Equity And Noncontrolling Interest) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Beginning balance
 
 
$ 5,131 
$ 5,040 
Net income (loss)
36 
24 
46 
29 
Other comprehensive income
 
 
40 
(16)
Purchase of company stock
 
 
(396)
 
Purchase of shares in noncontrolling interests
 
 
 
(4)
Issuance of common stock through Employee Stock Purchase Plan
 
 
 
Shares issued from treasury
 
 
Issuance of common stock shares to directors
 
 
Attribution of share based payments
 
 
11 
10 
Ending balance
4,834 
5,061 
4,834 
5,061 
Stockholders' Equity [Member]
 
 
 
 
Beginning balance
 
 
5,118 
5,016 
Net income (loss)
 
 
47 
30 
Other comprehensive income
 
 
40 
(16)
Purchase of company stock
 
 
(396)
 
Purchase of shares in noncontrolling interests
 
 
 
(3)
Issuance of common stock through Employee Stock Purchase Plan
 
 
 
Shares issued from treasury
 
 
 
Issuance of common stock shares to directors
 
 
Attribution of share based payments
 
 
11 
10 
Ending balance
4,822 
5,039 
4,822 
5,039 
Noncontrolling Interests In Consolidated Subsidiaries [Member]
 
 
 
 
Beginning balance
 
 
13 
24 
Net income (loss)
 
 
(1)
(1)
Purchase of shares in noncontrolling interests
 
 
 
(1)
Ending balance
$ 12 
$ 22 
$ 12 
$ 22 
Equity (Schedule Of Comprehensive Income (Loss)) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Equity
 
 
 
 
Net Income
$ 36 
$ 24 
$ 46 
$ 29 
Foreign currency translation adjustments
15 
(19)
38 
(15)
Unrealized gains on derivative instruments
 
 
Unrealized losses on available for sale securities
 
(1)
 
(1)
Total comprehensive income
53 
86 
13 
Comprehensive loss attributable to noncontrolling interests
Comprehensive income attributable to Hyatt Hotels Corporation
$ 54 
$ 5 
$ 87 
$ 14 
Stock-Based Compensation (Narrative) (Details) (USD $)
In Millions, except Share data, unless otherwise specified
6 Months Ended
Jun. 30, 2011
Amortization period, deferred compensation expense, years
10 
Maximum [Member] |
Performance Share Units [Member]
 
Percentage of shares vested
200.00% 
Minimum [Member] |
Performance Share Units [Member]
 
Percentage of shares vested
0.00% 
Stock Appreciation Rights [Member]
 
Contractual life, stock appreciation rights (in years)
10 
Grants in period
359,062 
Weighted-average fair value at grant date
$ 19.08 
Total unearned compensation
$ 20 
Restricted Stock Units [Member]
 
Grants in period
498,809 
Weighted-average fair value at grant date
$ 41.66 
Total unearned compensation
36 
Performance Share Units [Member]
 
Grants in period
99,660 
Weighted-average fair value at grant date
$ 41.74 
Performance period (in years)
Total unearned compensation
$ 3 
Related-Party Transactions (Leases Narrative) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30, 2010
6 Months Ended
Jun. 30, 2010
3 Months Ended
Jun. 30, 2011
Related Party [Member]
6 Months Ended
Jun. 30, 2011
Related Party [Member]
Related party rent, taxes and operating expenses included in selling, general and administrative expense
$ 3 
$ 5 
 
 
Future sublease income
 
 
17 
17 
Recognized loss on transaction recorded in other income (loss)
 
 
$ (5)
$ (5)
Related-Party Transactions (Other Services Narrative) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Management and franchise fees
$ 75 
$ 64 
$ 145 
$ 121 
Related Party Other Services [Member]
 
 
 
 
Management and franchise fees
Receivables due from related parties
$ 1 
 
$ 1 
 
Related-Party Transactions (Equity Method Investments Narrative) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Dec. 31, 2010
Management and franchise fees
$ 75 
$ 64 
$ 145 
$ 121 
 
Maximum [Member] |
Equity Method Investments [Member]
 
 
 
 
 
Ownership percentage in the joint venture
50.00% 
 
50.00% 
 
 
Minimum [Member] |
Equity Method Investments [Member]
 
 
 
 
 
Ownership percentage in the joint venture
8.00% 
 
8.00% 
 
 
Equity Method Investments [Member]
 
 
 
 
 
Management and franchise fees
10 
18 
17 
 
Due from related parties
$ 10 
 
$ 10 
 
$ 8 
Related-Party Transactions (Share Repurchase Narrative) (Details) (Common Class B, USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended
Jun. 30, 2011
Common Class B
 
Stock repurchased
8,987,695 
Cost per share
$ 44.03 
Share repurchase, value
$ 396 
Percent repurchased
5.20% 
Segment Information (Summarized Consolidated Financial Information by Segment) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Revenues
$ 936 
$ 889 
$ 1,811 
$ 1,730 
Adjusted EBITDA
151 
135 
260 
247 
Depreciation and amortization
72 
66 
143 
136 
North American Management and Franchising [Member]
 
 
 
 
Revenues
397 
361 
789 
708 
Intersegment Revenues
15 1
17 1
29 1
33 1
Adjusted EBITDA
44 
41 
84 
72 
Depreciation and amortization
International Management and Franchising [Member]
 
 
 
 
Revenues
54 
50 
105 
98 
Intersegment Revenues
1
1
1
1
Adjusted EBITDA
22 
18 
42 
32 
Depreciation and amortization
Owned and Leased Hotels [Member]
 
 
 
 
Revenues
484 
483 
916 
934 
Adjusted EBITDA
114 
103 
189 
185 
Depreciation and amortization
66 
61 
132 
126 
Corporate and Other [Member]
 
 
 
 
Revenues
21 
17 
39 
32 
Adjusted EBITDA
(29)2
(27)2
(55)2
(42)2
Depreciation and amortization
Favorable settlement from a construction dispute
 
 
 
Eliminations [Member]
 
 
 
 
Revenues
(20)1
(22)1
(38)1
(42)1
Adjusted EBITDA
 1
 1
 1
 1
Depreciation and amortization
 1
 1
 1
 1
Segment Information (Reconciliation of Consolidated Adjusted EBITDA to EBITDA and a Reconciliation of EBITDA to Net Income (Loss) attributable to Hyatt Hotels Corporation) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Segment Information
 
 
 
 
Adjusted EBITDA
$ 151 
$ 135 
$ 260 
$ 247 
Equity earnings (losses) from unconsolidated hospitality ventures
(11)
(19)
Asset impairments
(1)
(3)
(1)
(3)
Other income (loss), net
(9)
(6)
(6)
10 
Discontinued operations, net of tax
 
 
Net loss attributable to noncontrolling interests
Pro rata share of unconsolidated hospitality ventures Adjusted EBITDA
(22)
(18)
(37)
(32)
EBITDA
122 
103 
222 
207 
Depreciation and amortization
(72)
(66)
(143)
(136)
Interest expense
(14)
(12)
(27)
(24)
(Provision) benefit for income taxes
 
(5)
(17)
NET INCOME ATTRIBUTABLE TO HYATT HOTELS CORPORATION
$ 37 
$ 25 
$ 47 
$ 30 
Earnings Per Share (Schedule of the Calculation of Basic and Diluted Earnings Per Share) (Details) (USD $)
In Millions, except Share data
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Earnings Per Share
 
 
 
 
Income from continuing operations
$ 36 
$ 19 
$ 46 
$ 26 
Gain from discontinued operations
 
 
NET INCOME
36 
24 
46 
29 
Net loss attributable to noncontrolling interests
Net income attributable to Hyatt Hotels Corporation
$ 37 
$ 25 
$ 47 
$ 30 
Basic weighted average shares outstanding
169,907,013 
174,118,518 
172,056,525 
174,040,620 
Share-based compensation
231,715 
139,439 
272,713 
63,203 
Diluted weighted average shares outstanding
170,138,728 
174,257,957 
172,329,238 
174,103,823 
Income from continuing operations
$ 0.21 
$ 0.11 
$ 0.27 
$ 0.15 
Gain from discontinued operations
 
$ 0.03 
 
$ 0.02 
Net income
$ 0.21 
$ 0.14 
$ 0.27 
$ 0.17 
Net loss attributable to noncontrolling interests - Basic
$ 0.01 
$ 0 
$ 0.01 
$ 0 
Net income attributable to Hyatt Hotels Corporation
$ 0.22 
$ 0.14 
$ 0.28 
$ 0.17 
Income (loss) from continuing operations
$ 0.21 
$ 0.11 
$ 0.27 
$ 0.15 
Gain from discontinued operations
 
$ 0.03 
 
$ 0.02 
Net income
$ 0.21 
$ 0.14 
$ 0.27 
$ 0.17 
Net loss attributable to noncontrolling interests - Diluted
$ 0.01 
$ 0 
$ 0.01 
$ 0 
Net income attributable to Hyatt Hotels Corporation
$ 0.22 
$ 0.14 
$ 0.28 
$ 0.17 
Earnings Per Share (Anti-dilutive Shares Issued) (Details)
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Stock-settled SARs [Member]
 
 
 
 
Antidilutive securities excluded from the computations of diluted net income per share
273,320 
219,500 
150,400 
145,900 
Antidilutive Restricted Stock Units [Member]
 
 
 
 
Antidilutive securities excluded from the computations of diluted net income per share
49,000 
756,400 
4,440 
832,700 
Performance Share Units [Member]
 
 
 
 
Antidilutive securities excluded from the computations of diluted net income per share
 
 
 
 
Other Income (Loss), Net (Reconciliation of Components in Other Income (Loss), Net) (Details) (USD $)
In Millions
3 Months Ended
Jun. 30,
6 Months Ended
Jun. 30,
2011
2010
2011
2010
Other Income (Loss), Net
 
 
 
 
Interest income
$ 6 
$ 5 
$ 11 
$ 10 
Gains (losses) on other marketable securities
(6)
(9)
(7)
Foreign currency losses
(3)
(1)
(4)
(2)
Loss on sales of real estate
(2)
 
(2)
 
Other
(4)
(1)
(4)
 
Other income (loss), net
$ (9)
$ (6)
$ (6)
$ 10 
Subsequent Event (Details) (Lodge Works Sub Event [Member], USD $)
In Millions
Jul. 13, 2011
Lodge Works Sub Event [Member]
 
Total purchase price
$ 802