Hilton Worldwide Q1 Profit Soars; Lifts FY14 Forecast

(RTTNews) - Hilton Worldwide Holdings, Inc. (HLT) reported Friday a surge in the first-quarter profit, benefited by special gain as well as strong revenue growth. Further, the hospitality firm issued earnings forecast for its second quarter, better than analysts' estimates. The company also lifted its fiscal 2014 expectations.

President & Chief Executive Officer Christopher Nassetta said, "We had a strong first quarter that significantly exceeded our expectations. We are very optimistic about the remainder of 2014, and as a result we have increased our RevPAR, EPS and Adjusted EBITDA outlook for the year."

In pre-market activity, Hilton stock was gaining $0.35 or 1.55 percent, trading at $22.99.

The first-quarter 2014 net income attributable to stockholders grew to $123 million or $0.12 per share from last year's $34 million or $0.03 per share.

The latest quarter results included a special gain of $13 million related to share-based compensation related to the initial public offering.

Adjusted for special items, quarterly earnings per share amounted to $0.13. On average, 19 analysts polled by Thomson Reuters expected earnings of $0.09 per share for the quarter. Analysts' estimates typically exclude one-time items.

Adjusted earnings before interest, tax, depreciation and amortization or EBITDA increased 22 percent to $544 million from last year's $447 million.

The company recorded total revenues of $2.36 billion in the recent quarter, higher than last year's $2.26 billion. The Street had expected revenues of $2.34 billion.

System-wide comparable revenue per available room or RevPAR increased 6.6 percent for the first quarter on a currency neutral basis.

In the quarter, management and franchise fees increased 17 percent year-over-year to $331 million. RevPAR at comparable managed and franchised hotels increased 6.8 percent on a currency neutral basis.

Revenues from the ownership segment were $952 million, 3 percent higher than the prior year, and RevPAR at comparable hotels increased 5.1 percent on a currency neutral basis.

Looking ahead, for the second quarter, Hilton expects adjusted earnings per share of $0.18 to $0.20, while analysts estimate $0.17. System-wide RevPAR is expected to increase between 5.5 percent and 6.5 percent on a comparable and currency neutral basis and adjusted EBITDA is expected to be between $635 million and $655 million.

For 2014, the company has raised its annual adjusted earnings per share view to $0.64 - $0.67 from the previous guidance of $0.57- $0.61. Analysts project earnings per share of $0.60 for the year.

Adjusted EBITDA is now projected to be between $2.415 billion and $2.465 billion, with the new midpoint above the top end of its prior guidance of $2.365 billion to $2.435 billion.

The company now expects RevPAR growth with system-wide comparable RevPAR rising 5.5 percent to 7 percent, compared to earlier forecast of an increase between 5 percent and 7 percent.