2017

At-A-Glance

Key Highlights and Performance Metrics.

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Nearly a century ago, a young entrepreneur named Conrad Hilton purchased, almost on impulse, the Mobley Hotel in Cisco, Texas. Soon the inventor of the modern hospitality industry found himself setting an even grander goal: “To fill the earth with the light and warmth of hospitality.” Almost one hundred years later our world continues to benefit from Conrad’s vision.

I have said for some time that we have entered a Golden Age of Travel, and 2017 brought an important milestone with international tourism arrivals reaching a staggering 1.3 billion¹ — an all-time high. Trends indicate this record will continue to be broken as the middle class grows in places like China and India, and the next generations of travelers seek unique adventures and genuine hospitality.

This golden age is a golden opportunity for our industry. Travel and tourism can emerge as a powerful remedy to the world’s challenges. We are a principal contributor to global economic growth, providing 10 percent of global GDP. We are also the world’s largest employer, hiring one out of every nine people.¹ Travel is an engine for understanding, connecting diverse peoples, ideas, and cultures. We are in the business of creating travel opportunities and environments that enhance those human connections, creating a positive ripple effect through communities all over the world.

This golden age is also a golden opportunity for Hilton. Our guests come from around the globe and arrive at our nearly 5,300 properties carrying the excitement, joy, and stress of their days. Waiting to greet them are 380,000² Hilton Team Members with a simple mission: To make each and every guest feel like part of our family, feel at home, and to enrich their lives with unforgettable travel experiences.

2017 was a pivotal year for Hilton. We successfully completed the spin-offs of Park Hotels & Resorts and Hilton Grand Vacations to create a new simplified, resilient, fee-based business model. We celebrated our 5,000th property milestone, launched our 14th brand — Tapestry Collection by Hilton, rolled out new technologies, and returned nearly $1.1 billion to shareholders, all of which enhance the guest experience, strengthen our loyalty base, and drive performance.

Hilton continued to expand travel opportunities for millions of ambitious new travelers. We opened nearly 400 new properties, a rate of more than one hotel per day, and 51,600 net new rooms. This marked our third consecutive year of record net unit growth — 6.5 percent — allowing us to welcome guests in 105 countries and territories. With a pipeline of nearly 2,300 properties and 345,000 rooms, we continue to lead the industry in net unit growth. And our 21 percent share of rooms under construction accounts for more than four times our current market share, more than any other hospitality company.

We expanded our geographic reach as well. We now have more than 200 properties in Asia Pacific, more than 100 of which are in Greater China. Our growth in Latin America continues at a rapid pace with more than 100 hotels in the region and more than 70 in the pipeline. And, through our Hilton Africa Growth Initiative, we expect to add 100 properties to our Sub-Saharan African portfolio over the next five years.

To deliver exceptional experiences for every guest, every hotel, every time, we pursue technological advances that create customizable experiences. We scaled our Digital Key technology to 350,000 rooms at more than 2,500 properties worldwide. To allow our guests to control their stay from the palm of their hand we introduced Connected Room, providing guests the freedom to control lighting, temperature, and entertainment all from the Hilton Honors app.

And we create unparalleled value for our guests through our Hilton Honors loyalty program, which continues to grow with 71 million members and counting. In 2018, we are adding new benefits and introducing a suite of American Express co-branded credit cards — all of which empower members to achieve their travel goals.

As always, our hospitality mission extends beyond our hotels and into our communities. Our Travel with Purpose corporate responsibility strategy guides how we use our footprint to empower communities and contribute lasting, positive change. We consistently review and build on our robust commitments to youth opportunity, environmental stewardship, and community resiliency, and in 2017 this approach earned Hilton a spot on the Dow Jones Sustainability Index for the first time. This year we reached a cumulative $1 billion in savings through our industry-leading sustainability practices. Additionally, to date, we have dedicated more than $3 million to disaster relief efforts and $1 million to action grant projects that support our mission.

At Hilton, we have a century-long commitment to infuse the “light and warmth of hospitality” in the connections we make with the 160 million or so guests we welcome with purpose every year. As we expand our hospitality to new countries in 2018, we will strive to enable our guests to travel with purpose by giving them more opportunities to make meaningful connections with the people and communities around them.

On behalf of our entire team, thank you for your continued partnership during this historically important time for our industry.

We are Hilton. We are hospitality.

Sincerely,

Christopher J. Nassetta
President & Chief Executive Officer

¹ Source: WTTC https://www.wttc.org/-/media/files/reports/economic-impact-research/regions-2017/world2017.pdf
² Team Members include employees at Hilton corporate offices and its owned and managed properties, and employees of franchisees who work on-property at independently owned and operated franchise properties in the Hilton portfolio.

Properties above are New York Hilton Midtown, Conrad Koh Samui, Hilton Niseko Village.