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 BEVERLY HILLS, Calif., Jan. 13 /PRNewswire/ -- Hilton Hotels Corp. today reported a 22 percent increase in net income for the fourth quarter ended Dec. 31, 1993. Net income totaled $32.3 million, or $.67 per share, compared with $26.5 million, or $.55 per share, in the 1992 fourth quarter.
 The increase reflects continued strength in gaming operations, coupled with improved operating performance in major hotel markets. Additionally, the fourth quarter provision for income taxes reflects a credit resulting from the favorable resolution of Federal and State income taxes for prior years.
 Operating income for the quarter was $59 million, a 5 percent increase from 1992's $56.4 million. The company's gaming operations reported operating income of $36.6 million, a 4 percent jump from 1992's $35.2 million. While operating income from hotels was flat for the quarter, $29.6 million in 1993 vs. $29.7 million in 1992, the operating performance from this division increased 42 percent before a $12.5 million reserve for a loan to a managed property.
 Strong performances were recorded at Hilton's Reno, Nev. and Laughlin, Nev. gaming properties, as well as a particularly successful quarter at the Flamingo Hilton Las Vegas. The Las Vegas Hilton was impacted by increased marketing and capital improvement expenses, including the opening of the "Starlight Express" musical production. Since its September opening, however, "Starlight Express" has played consistently to sold-out audiences and grossed $5.8 million in ticket sales in its first three months.
 Nevada occupancy was 87 percent, compared to 86 percent a year ago.
 Significant increases in operating income were recorded in a number of Hilton's key hotel markets, including New York, Chicago, New Orleans and Hawaii, along with an encouraging division-wide increase of almost 4 percent in average room rate.
 Hotel occupancy was flat at 64 percent from the same period in 1992.
 Net income for the year, before the cumulative effect of accounting changes, was $102.7 million, or $2.14 per share, compared with $103.9 million, or $2.17 per share, in 1992. Including the effects of accounting changes, 1993 net income totaled $106.1 million, or $2.21 per share. During the current year, the company recorded an after-tax loss of $3.1 million resulting from demolition of certain facilities at the Flamingo Hilton Las Vegas to permit further expansion at that property.
 Total operating income for the year increased 9 percent to $239.9 million, from $219.9 million in 1992. Operating income was up in both gaming and hotels. The Gaming Division reported an increase of 11 percent to $170.5 million, vs. $153.4 million in 1992, with all gaming properties posting increased earnings from 1992. Despite the aforementioned $12.5 million bad debt provision, operating income from the Hotels Division rose 5 percent to $96.2 million, from $91.5 million a year ago.
 Nevada occupancy for the year was 89 percent, up from 87 percent in 1992, while hotel occupancy increased to 67 percent from 66 percent a year ago.
 Several significant gaming developments not only highlighted 1993, but are expected to bring positive results in 1994. These include Hilton acquiring the right to develop two riverboat casinos in Kansas City, Mo., the first of which will open in summer 1994; receiving a license from regulatory authorities to operate the "Queen of New Orleans" riverboat in New Orleans (opening February 1994), and together with Caesars World Inc. and Circus Circus Enterprises Inc., being named the exclusive developer and operator of a 75,000 square-foot, land-based casino in Windsor, Ontario, Canada. A 60,000 square-foot temporary casino will open in Windsor in spring 1994.
 In addition, a hotel-casino in Brisbane, Australia -- operated by Hilton's Conrad subsidiary -- is scheduled to open in spring 1995. The company also submitted a proposal for a riverboat casino in Michigan City, Ind., close to the metropolitan Chicago market.
 Improved hotel results for the year reflected improvement in several key markets, the success of marketing programs and a general resurgence in the hotel industry. Properties in New York and Chicago continued their trend of improved performance that began in the third quarter, while other large, major-market properties -- including those in Atlanta, San Francisco, New Orleans and San Antonio -- also had strong years.
 In 1994, Hilton expects the 1,241-room Hilton Waikoloa Village -- purchased in September 1993 at a fraction of its original cost -- to help strengthen a Hawaii market still feeling the effects of sluggish economies in Southern California and Japan. In addition, the Hilton Grand Vacations Co. 200-unit vacation ownership project at the Flamingo Hilton Las Vegas got off to an excellent start with strong pre-opening sales.
 "In addition to an outstanding fourth quarter, we saw 1993 as a gratifying and pivotal year in which we laid the foundation for greater worldwide success in 1994 and 1995," said Barron Hilton, chairman and chief executive officer.
 "We are meeting new gaming competition by making the necessary investments in our Nevada properties, while aggressively pursuing new opportunities," he said. "Our competitive victories in Kansas City and Windsor, and progress in New Orleans, Brisbane and Uruguay will bring benefits starting in the next year.
 "General recovery in the hotel industry and strategic acquisitions such as Waikoloa, have us positioned for success in the coming years."
 Hilton added, "The combination of strong businesses in both gaming and hotels, our prudent yet aggressive approach to improving each of these businesses and the strengthening of the economic situation in many parts of the world -- including the United States -- give us reason for optimism."
 Consolidated Statement of Income
 (In millions, except per share amounts)
 Three Months Ended 12 Months Ended
 Dec. 31, Percent Dec. 31, Percent
 1993 1992 Change 1993 1992 Change
 Total revenue $370.0 335.5 10 $1,393.5 1,229.6 13
 Hotels $29.6 29.7 --- $96.2 91.5 5
 Gaming 36.6 35.2 4 170.5 153.4 11
 expense (7.2) (8.5) -15 (26.8) (25.0) 7
 Total operating
 income 59.0 56.4 5 239.9 219.9 9
 Net interest
 expense (16.9) (17.8) -5 (73.2) (61.7) 19
 Foreign currency
 losses (0.1) --- --- (1.3) --- ---
 transactions 1.4 0.9 --- (3.1) 0.9 ---
 Provision for
 income taxes (11.1) (13.0) -15 (59.6) (55.2) 8
 Cumulative effect
 of accounting
 changes --- --- --- 3.4 --- ---
 Net income $32.3 26.5 22 $106.1 103.9 2
 Earnings per share:
 Before cumulative
 effect of accounting
 changes: $0.67 0.55 22 $2.14 2.17 -1
 Cumulative effect
 of accounting
 changes: --- --- --- 0.07 --- ---
 Net income: 0.67 0.55 22 2.21 2.17 2
 Average number
 of shares 48.1 47.9 48.0 47.9
 Percentage of
 Hotels owned or
 managed 64 64 --- 67 66 2
 Gaming (Nevada) 87 86 1 89 87 2
 -0- 1/13/94
 /CONTACT: Marc A. Grossman, Corporate Communications, 310-205-4545, or 702-732-5537/

CO: Hilton Hotels Corp. ST: California IN: LEI CNO SU: ERN

JM-MF -- LA010 -- 1688 01/13/94 09:07 EST
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Publication:PR Newswire
Date:Jan 13, 1994

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