Hilton Reports 4Q98, FY98 Results
Beverly Hills, Calif., February 4, 1999—Hilton Hotels Corporation (NYSE:HLT) today reported results for the fourth quarter and year ended December 31, 1998. The results for both the quarter and year reflect Hilton`s spin-off of its casino gaming operations, a tax-free distribution to shareholders that was completed December 31, 1998.
Hilton reported income from continuing operations for the fourth quarter of $44 million, or $.17 per diluted share, compared to $41 million, or $.15 per diluted share, for the same period in 1997. The company`s proportionate share of costs associated with the gaming spin-off reduced fourth quarter earnings by $.04 per diluted share. In the 1997 quarter, costs associated primarily with the ITT acquisition effort reduced earnings also by $.04 per diluted share.
For the year, Hilton reported income from continuing operations of $188 million, or $.71 per diluted share, versus 1997`s $183 million, or $.68 per diluted share. The aforementioned costs impacted both 1998 and 1997 EPS by $.04 per diluted share.
The company reported total fourth quarter 1998 earnings before interest, taxes, depreciation, amortization and non-cash items (EBITDA) of $151 million, a 36 percent increase over the 1997 period. Fourth quarter 1998 EBITDA included costs of $13 million associated with the gaming spin-off, while EBITDA for the same period in 1997 included $16 million of costs associated primarily with the ITT effort. On a recurring basis, total EBITDA for the fourth quarter 1998 rose 29 percent to $164 million from $127 million in 1997.
Fiscal year 1998 total EBITDA rose 20 percent to $596 million from $497 million in 1997. On a recurring basis, giving effect to the costs noted above, total EBITDA for the year was $609 million, up 19 percent from $513 million.
Driving the EBITDA gains for both the fourth quarter and year were exceptional performances from several of Hilton`s major market full-service hotels, along with the EBITDA contribution from hotel acquisitions made during the year.
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Fourth quarter and fiscal 1998 interest expense reflect higher debt levels due to acquisition activity during the year, and a higher average cost of debt resulting from the company issuing long-term fixed notes to replace floating rate debt in 1997.
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