February 16, 2017

Hilton reports corporate transient business pickup in Q4


Even before Hilton and other hoteliers reported Q4 earnings, industry analysts broadly concluded that hotels performed better than expected, fueled by a pickup in corporate transient business.

Hilton has maintained its 2017 guidance—1 percent to 3 percent growth in revenue per available room—though an uptick in corporate transient business that began in the fourth quarter and carried into January has made the company's outlook slightly more positive than it was a quarter ago.

"It would be hard to say that I don't feel a bit better about our 1 to 3 than I did when we gave it to you last fall," Nassetta said during the company's earnings call. "The opportunity to be at the midpoint [of Hilton's guidance] or above would be higher today than it was at that time."

The company has "some green shoots": A solid base of group business is on the books, according to Nassetta, and corporate transient business for 2017 looks good so far, as group average daily rate and corporate negotiated rates are up 2 percent to 3 percent versus 2016. Still, Nassetta said, there are "a lot of swirling winds out there" that could impact the hotel business in 2017 and beyond.

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