Hyatt Hotels Earnings 2019-12-31

H 10K Annual Report

Balance Sheet	Income Statement	Cash Flow

Comparables ($MM TTM)
Ticker	M Cap	Assets	Liab	Rev	G Profit	Net Inc	EBITDA	EV	G Margin	EV/EBITDA	ROA
IHG	10,223	3,753	4,830	0	0	0	0	10,021			0%
HTHT	9,184	23,993	17,674	0	0	0	0	13,112			0%
H	8,094	8,082	4,435	4,909	0	430	978	9,239	0%	9.4	5%
CZR	7,820	26,136	23,328	8,637	0	-223	2,182	15,063	0%	6.9	-1%
PK	5,525	9,431	3,855	2,707	0	291	704	8,003	0%	11.4	3%
WH	5,406	4,656	3,356	2,132	0	148	414	7,430	0%	17.9	3%
CHH	4,794	1,214	1,337	1,072	0	216	365	5,544	0%	15.2	18%
ERI	3,521	6,082	4,996	2,432	0	95	635	3,327	0%	5.2	2%
STAY	3,159	3,940	2,627	1,242	0	203	566	5,276	0%	9.3	5%
BYD	3,121	6,710	5,498	3,077	0	129	661	6,813	0%	10.3	2%

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Form 10-K

(Mark One)


☑	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2019


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File No. 001-34521

HYATT HOTELS CORPORATION

(Exact Name of Registrant as Specified in Its Charter)



Delaware				20-1480589
(State or Other Jurisdiction of Incorporation or Organization)				(IRS Employer Identification No.)
150 North Riverside Plaza
	8th Floor,	Chicago,	Illinois	60606
(Address of Principal Executive Offices)				(Zip Code)

Registrant's telephone number, including area code: (312) 750-1234

Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol	Name of each exchange on which registered
Class A Common Stock, $0.01 par value	H	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☑

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check One):



Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☑

At June 28, 2019, the aggregate market value of the registrant's Class A common stock, $0.01 par value, held by non-affiliates of the registrant was approximately $2,838.0 million (based upon the closing sale price of the Class A common stock on June 28, 2019 on The New York Stock Exchange). The market value of the registrant's Class B common stock is not included in the above value as there is no active market for such stock.

At January 31, 2020, there were 35,841,277 shares of the registrant's Class A common stock, $0.01 par value, outstanding and 65,463,274 shares of the registrant's Class B common stock, $0.01 par value, outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Part III of this Annual Report on Form 10-K incorporates by reference portions of the registrant's Proxy Statement for its 2020 Annual Meeting of Stockholders to be held on May 20, 2020.

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HYATT HOTELS CORPORATION

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FISCAL YEAR ENDED DECEMBER 31, 2019



	PART I

	Disclosure Regarding Forward-Looking Statements	1
Item 1.	Business	4
Item 1A.	Risk Factors	26
Item 1B.	Unresolved Staff Comments	51
Item 2.	Properties	52
Item 3.	Legal Proceedings	57
Item 4.	Mine Safety Disclosures	58
	Executive Officers of the Registrant	59

	PART II

Item 5.	Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities	62
Item 6.	Selected Financial Data	65
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	66
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	91
Item 8.	Financial Statements and Supplementary Data	92
Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	92
Item 9A.	Controls and Procedures	92
Item 9B.	Other Information	92

	PART III

Item 10.	Directors, Executive Officers, and Corporate Governance	93
Item 11.	Executive Compensation	93
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	93
Item 13.	Certain Relationships and Related Transactions, and Director Independence	94
Item 14.	Principal Accountant Fees and Services	94

	PART IV

Item 15.	Exhibits and Financial Statement Schedule	96
Item 16.	Form 10-K Summary	96

Signatures		97

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Disclosure Regarding Forward-Looking Statements

This annual report contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include statements about the Company's plans, strategies, financial performance, the amount by which the Company intends to reduce its real estate asset base and the anticipated timeframe for such asset dispositions, prospects or future events and involve known and unknown risks that are difficult to predict. As a result, our actual results, performance or achievements may differ materially from those expressed or implied by these forward-looking statements. In some cases, you can identify forward-looking statements by the use of words such as "may," "could," "expect," "intend," "plan," "seek," "anticipate," "believe," "estimate," "predict," "potential," "continue," "likely," "will," "would," and variations of these terms and similar expressions, or the negative of these terms or similar expressions. Such forward-looking statements are necessarily based upon estimates and assumptions that, while considered reasonable by us and our management, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to:


•	the factors discussed in this annual report set forth under the sections titled "Risk Factors" in Part I, Item 1A and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Part II, Item 7;


•	general economic uncertainty in key global markets and a worsening of global economic conditions or low levels of economic growth;


•	the rate and the pace of economic recovery following economic downturns;


•	levels of spending in business and leisure segments as well as consumer confidence;


•	declines in occupancy and average daily rate ("ADR");


•	limited visibility with respect to future bookings;


•	loss of key personnel;


•	domestic and international political and geo-political conditions, including political or civil unrest or changes in trade policy;


•	hostilities, or fear of hostilities, including future terrorist attacks, that affect travel;


•	travel-related accidents;


•	natural or man-made disasters such as earthquakes, tsunamis, tornadoes, hurricanes, floods, wildfires, oil spills, nuclear incidents, and global outbreaks of pandemics or contagious diseases or fear of such outbreaks, such as the recent coronavirus (COVID-19) outbreak;


•	our ability to successfully achieve certain levels of operating profits at hotels that have performance tests or guarantees in favor of our third-party owners;


•	the impact of hotel renovations and redevelopments;


•	risks associated with our capital allocation plans and common stock repurchase program and other forms of shareholder capital return, including the risk that our common stock repurchase program could increase volatility and fail to enhance shareholder value;


•	our intention to pay a quarterly cash dividend and the amounts thereof, if any;


•	the seasonal and cyclical nature of the real estate and hospitality businesses;


•	changes in distribution arrangements, such as through internet travel intermediaries;


•	changes in the tastes and preferences of our customers;


•	relationships with colleagues and labor unions and changes in labor laws;


•	the financial condition of, and our relationships with, third-party property owners, franchisees, and hospitality venture partners;


•	the possible inability of third-party owners, franchisees, or development partners to access capital necessary to fund current operations or implement our plans for growth;


•	risks associated with potential acquisitions and dispositions and the introduction of new brand concepts;


•	the timing of acquisitions and dispositions and our ability to successfully integrate completed acquisitions with existing operations;


•	failure to successfully complete proposed transactions (including the failure to satisfy closing conditions or obtain required approvals);


•	our ability to successfully execute on our strategy to expand our management and franchising business while at the same time reducing our real estate asset base within targeted timeframes and at expected values;


•	declines in the value of our real estate assets;

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•	unforeseen terminations of our management or franchise agreements;


•	changes in federal, state, local, or foreign tax law;


•	increases in interest rates and operating costs;


•	foreign exchange rate fluctuations or currency restructurings;


•	lack of acceptance of new brands or innovation;


•	general volatility of the capital markets and our ability to access such markets;


•	changes in the competitive environment in our industry, including as a result of industry consolidation, and the markets where we operate;


•	our ability to successfully grow the World of Hyatt loyalty program;


•	cyber incidents and information technology failures;


•	outcomes of legal or administrative proceedings; and


•	violations of regulations or laws related to our franchising business.

These factors are not necessarily all of the important factors that could cause our actual results, performance, or achievements to differ materially from those expressed in or implied by any of our forward-looking statements. Other unknown or unpredictable factors also could harm our business, financial condition, results of operations, or cash flows. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements set forth above. Forward-looking statements speak only as of the date they are made, and we do not undertake or assume any obligation to update publicly any of these forward-looking statements to reflect actual results, new information or future events, changes in assumptions, or changes in other factors affecting forward-looking statements, except to the extent required by applicable law. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

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Terms Used in this Annual Report

Unless otherwise specified or the context otherwise requires, references in this annual report to "we," "our," "us," "Hyatt," and the "Company" refer to Hyatt Hotels Corporation and its consolidated subsidiaries.

As used in this annual report, the term "Pritzker family business interests" means (1) various lineal descendants of Nicholas J. Pritzker (deceased) and spouses and adopted children of such descendants; (2) various trusts for the benefit of the individuals described in clause (1) and trustees thereof; and (3) various entities owned and/or controlled, directly and/or indirectly, by the individuals and trusts described in (1) and (2).

As used in this annual report, the term "properties" refers to hotels, resorts, and other properties, including branded spas and fitness studios, and residential, vacation, and condominium ownership units that we develop, own, operate, manage, franchise, or to which we provide services or license our trademarks. "Hyatt portfolio of properties" or "portfolio of properties" refers to hotels, resorts, and other properties that we develop, own, operate, manage, franchise, license, or provide services to, including under the Park Hyatt, Miraval, Grand Hyatt, Alila, Andaz, The Unbound Collection by Hyatt, Destination, Hyatt Regency, Hyatt, Hyatt Ziva, Hyatt Zilara, Thompson Hotels, Hyatt Centric, Caption by Hyatt, Joie de Vivre, Hyatt House, Hyatt Place, tommie, Hyatt Residences Club, and Exhale brands. Our "worldwide hotel portfolio" includes our full and select service hotels. Our "worldwide property portfolio" includes our wellness and all-inclusive resorts, branded spas and fitness studios, and residential, vacation, and condominium ownership units in addition to our worldwide hotel portfolio. "Residential ownership units" refer to residential units that we manage, own, or to which we provide services or license our trademarks (such as serviced apartments and Hyatt-branded residential units) that are typically part of a mixed-use project and located either adjacent to or near a full service hotel that is a member of the Hyatt portfolio of properties or in unique leisure locations. "Vacation ownership units" refer to the fractional and timeshare vacation ownership properties with respect to which we license our trademarks and that are part of the Hyatt Residence Club. "Condominium ownership units" refer to whole ownership residential units (condominium and private residences) that we provide services to and, in some cases management of, the rental programs or homeowner associations associated with such units. "Hospitality ventures" refer to entities in the hospitality industry in which we own less than a 100% equity interest.

Additionally, through strategic relationships, we provide certain reservation and/or loyalty program services to hotels that are unaffiliated with our hotel portfolio and which operate under other tradenames or marks owned by such hotel or licensed by third parties.

As used in this annual report, the term "colleagues" refers to the more than 151,000 individuals working at our corporate and regional offices and our managed, franchised, and owned properties in 65 countries around the world. We directly employ approximately 55,000 of these colleagues. The remaining colleagues are employed by third-party owners and franchisees of our properties.

Park Hyatt^®, Miraval^®, Grand Hyatt^®,Alila^®, Andaz^®, The Unbound Collection by Hyatt^®,Destination^®, Hyatt Regency^®, Hyatt^®, Hyatt Ziva™, Hyatt Zilara™, Thompson Hotels^®, Hyatt Centric^®, Caption by Hyatt, Hyatt House^®, Hyatt Place^®, tommie™, Hyatt Residence Club^®, Hyatt Residences^®, Exhale^®, World of Hyatt^®, Hyatt Resorts™, and related trademarks, logos, trade names, and service marks appearing in this annual report are the property of Hyatt Corporation or another wholly owned subsidiary of Hyatt Hotels Corporation. All other trademarks, trade names, or service marks appearing in this annual report are the property of their respective owners.

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Part I

Item 1. Business.

Our History

In 1957, Hyatt was founded by Jay Pritzker when he purchased the Hyatt House motel adjacent to the Los Angeles International Airport. In 2004, substantially all of the hospitality assets owned by Pritzker family business interests, including Hyatt Corporation and Hyatt International Corporation, were consolidated under a single entity whose name was subsequently changed to Global Hyatt Corporation. On June 30, 2009, Global Hyatt Corporation changed its name to Hyatt Hotels Corporation. On November 10, 2009, we completed our initial public offering of our Class A common stock.

Overview

Hyatt Hotels Corporation is a global hospitality company with widely recognized, industry leading brands and a tradition of innovation developed over our more than sixty-year history. We develop, own, operate, manage, franchise, license, or provide services to a portfolio of properties, consisting of full service hotels, select service hotels, resorts, and other properties, including branded spas and fitness studios, timeshare, fractional, and other forms of residential, vacation, and condominium ownership units. At December 31, 2019, our worldwide hotel portfolio consisted of 913 hotels (223,111 rooms). See Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations—Overview" for a categorized breakdown of our portfolio.

Our twelve full service brands are: Park Hyatt, Grand Hyatt, Alila, Andaz, The Unbound Collection by Hyatt, Destination, Hyatt Regency, Hyatt, Thompson Hotels, Hyatt Centric, Joie de Vivre, and tommie. Our select service brands are Caption by Hyatt, Hyatt House, and Hyatt Place. In addition, we participate in an unconsolidated hospitality venture with a Chinese hospitality company that owns and is developing the UrCove select service brand intended to serve the upper-midscale market in Greater China. The Miraval and Exhale brands form a distinct wellness category within our portfolio of brands. Our all-inclusive resort brands are Hyatt Ziva and Hyatt Zilara. We also manage, provide services to, or license our trademarks with respect to residential ownership units that are often adjacent to a Hyatt-branded full service hotel. We consult with third parties in the design and development of such mixed-use projects. We license certain of our trademarks with respect to vacation ownership units, which are part of Hyatt Residence Club. Additionally, we provide services and/or manage the rental programs or homeowner associations associated with condominium ownership units.

Substantially all of our hotel general managers are trained professionals in the hospitality industry with extensive hospitality experience in their local markets and host countries. The general managers of our managed properties are empowered to operate their properties on an independent basis using their market knowledge, management experience, and understanding of our brands. Our colleagues and hotel general managers are supported by our regional management teams located in cities around the world and our executive management team, headquartered in Chicago.

We primarily derive our revenues from owned and leased hotel operations, management of hotels, and licensing of our portfolio of brands to franchisees. For each of the years ended December 31, 2019 and December 31, 2018, revenues totaled $5.0 billion and $4.5 billion, respectively, net income attributable to Hyatt Hotels Corporation totaled $766 million and $769 million, respectively, and Adjusted EBITDA totaled $754 million and $777 million, respectively. See Part II, Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations—Key Business Metrics Evaluated by Management—Adjusted Earnings Before Interest Expense, Taxes, Depreciation, and Amortization ("Adjusted EBITDA") and EBITDA" for our definition of Adjusted EBITDA, why we present it, and for a reconciliation of our net income attributable to Hyatt Hotels Corporation to consolidated Adjusted EBITDA for the periods presented.

Our Purpose, Vision, Mission, and Values

Our Purpose

We care for people so they can be their best.

Our Vision

A world of understanding and care.

Our Mission

We deliver distinctive experiences for our guests.

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Our Values

Respect, integrity, humility, empathy, creativity, and fun.

Our purpose, vision, mission, and values are brought to life by our colleagues, whom we refer to as the Hyatt family. We believe our colleagues around the world embody our purpose of caring for people, including one another, our guests and customers, property owners, and ultimately, the communities in which our hotels operate. We are strongly committed to advancing care for all of our stakeholders and creating personal connections that increase loyalty and drive results. The management teams at each of our managed properties lead by example, and we provide them with the appropriate autonomy to make operational decisions in the best interests of the hotel and brand. We believe the managers of our franchised properties are experienced operators with high standards who have demonstrated commitment to our values and our approach to caring for guests to enhance guest satisfaction. High levels of guest satisfaction lead to increased guest preference for our brands, which we believe results in a strengthened revenue base over the long term. We also believe engaged colleagues will enhance efficient operation of our properties, resulting in improved financial results for our owners. Sustained adherence to these principles is a basis for our brand reputation and one of the principal factors behind the decisions of our diverse group of owners and developers to invest in the Hyatt portfolio of properties around the world. We work with existing and prospective owners and developers to increase our presence around the world, which we expect will lead to guest satisfaction, brand preference, and new channels of professional growth for our colleagues.

Our Competitive Strengths

We have significant competitive strengths that support our mission to deliver distinctive experiences for our guests and drive growth and create value for our customers, colleagues, and shareholders.

World Class Brands. Inspired by a deep understanding of guest needs, we have developed a global suite of distinct brands. We believe our widely recognized, industry-leading brands provide us with a competitive advantage in attracting and driving preference. We have consistently received top rankings, awards, and accolades for service and guest experience from independent publications and surveys, including Condé Nast Traveler, Travel and Leisure, Forbes, AAA, and J.D. Power. The diversity and distinctiveness of our brand portfolio and the recognition and strength of our individual brands are key to our ability to drive preference.

Global Platform with Compelling Growth Potential. Our existing global presence is widely distributed, and our hotels operate in some of the most populous urban centers around the globe. We believe our existing hotels, located in key markets around the globe, provide us with a strong platform from which to selectively pursue new growth opportunities in markets where our brands are less prevalent. Our dedicated development executives in offices around the world apply their experience, market expertise, and knowledge to ensure the Hyatt portfolio of properties enhances preference for our brands. An important aspect of our compelling growth potential is our strong brand presence in higher growth markets such as Greater China and India. The combination of our existing locations and brands, experienced development team, World of Hyatt loyalty program, established third-party relationships, and significant access to capital provides us with a strong foundation for future growth and long-term value creation.

Deep Culture and Experienced Management Teams. Hyatt has a strong culture rooted in values that have supported our past success and form the foundation for our future. The members of the Hyatt family are united by shared values, a single purpose, and a deep commitment to listening, understanding, and personalizing experiences for our guests and customers – all of which we believe increases loyalty, differentiates us from the competition, and drives business results. Our colleagues at Hyatt properties are guided by experienced and dedicated teams including general managers and regional leadership teams that provide resources, mentorship and coaching, owner support, and other assistance. The general managers at our full service managed hotels have an average tenure of approximately 20 years, and senior operating management has an average of approximately 30 years of experience in the industry. Our seasoned executive management team sets overall policies for our Company, supports our regional teams and our colleagues around the world, provides strategic direction, and leads our global growth initiatives.

Strong Capital Base and Disciplined Financial Approach. Our approach is to maintain appropriate levels of financial leverage through industry cycles and downturns. At December 31, 2019, we had cash and cash equivalents and short-term investments of $961 million and available borrowing capacity of $1.5 billion. We believe that as a result of our balance sheet strength, we are uniquely positioned to take advantage of strategic opportunities to expand our presence and grow our business. We may deploy capital through acquisitions of management contracts, hospitality companies, real estate assets or investment in new lines of business. We adhere to a formal investment process to evaluate such opportunities with input from various groups within our global organization.

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Diverse Exposure to Hotel Management, Franchising, Ownership, and Development. We believe our experience as a global multi-brand manager, franchisor, owner, and developer of hotels makes us one of the best positioned hospitality companies in the world. Our mix of managed, franchised, and owned properties provides a broad and diverse base of revenues, profits, and cash flows and gives us flexibility to evaluate growth opportunities across our lines of business.

High-Quality Owned Hotels are Located in Desirable Markets and are a Source of Capital for New Growth Investments. At December 31, 2019, our owned and leased portfolio totaled 38 owned or leased properties (31 of which are owned) and 26 managed or franchised properties that are owned or leased (25 of which are owned) by unconsolidated hospitality ventures. Our owned full service hotels are located primarily in key markets, including major business centers and leisure destinations with strong growth potential, such as Chicago, London, New York, Paris, Miami, and Zurich. Our unconsolidated hospitality ventures include 50% ownership interests in properties in Mumbai and São Paulo. A number of our owned hotels and unconsolidated hospitality venture properties are unique assets with high brand recognition and a strong position in their local markets. We believe our owned assets provide us the opportunity to unlock additional shareholder value through targeted dispositions that provide cash proceeds to fund additional strategic investments to expand our presence or provide incremental return of capital to shareholders.

Our Business Strategy

Our strategy to drive long-term sustainable growth and create value for customers, colleagues, owners, and shareholders is focused on the following three areas:


•	Maximize Our Core Business: We continue to grow and operate our core business with excellence in order to be best-in-class while generating profits to fuel our growth.


•	Integrate New Growth Platforms: We seek to identify and integrate new opportunities to advance care for our guests and provide additional paths for growth.


•	Optimize Capital Deployment: We take a comprehensive and disciplined approach to our deployment of capital to expand our management and franchising business, invest in new growth platforms, and return capital to our shareholders.

We implement our strategy through a focus on four strategic priorities:

Cultivate the Best People and Evolve the Culture

We focus on cultivating the best people and fostering an inclusive work environment by attracting, developing, rewarding, and retaining individuals who live our values, distinguish Hyatt from our competitors, and provide a unique experience to our guests. We recognize our people and our culture are our greatest assets and the core of our strategy. Our goal is to sustain a strong pipeline of colleagues who are purpose driven, bring diverse perspectives, and have an agile, entrepreneurial mindset and to provide them with opportunities to fulfill their personal potential and development while helping to make Hyatt successful. We are focused on increasing the diverse representation amongst our colleagues and further integrating inclusion into our talent management practices.

Our brands are defined, in large part, by the commitment to genuine service and care that our colleagues deliver to our guests. We believe that while a great product is necessary for success, a service model that promotes genuine care for our guests and focuses on their particular needs is the key to a sustainable long-term advantage. Therefore, we strive to involve our colleagues in deciding how we care for our guests and identifying what we can do to improve guest satisfaction. We rely on our hotel general managers to lead by example and foster colleague engagement. In addition, we are focused on providing colleagues with the tools and technology needed to perform their jobs more effectively and efficiently to allow for further engagement with guests. We believe colleague engagement results in higher levels of customer satisfaction and improves the performance of our properties. To assist in this process, we aim to ensure talented management teams are in place worldwide and to reward those teams that achieve higher levels of colleague engagement, guest satisfaction, and hotel financial performance.

Through our global corporate responsibility program initiatives, we strive to advance our commitment to care by volunteering in our communities, supporting organizations that work in our communities, providing career opportunities for young people through our RiseHY program, and working to reduce our waste and carbon footprint to make the communities in which our hotels operate places where we want to live, where guests want to visit, and where our owners want to invest.

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Drive Guest and Customer Personalization

We aim to foster direct relationships with our guests by engaging with them in more direct ways, such as direct booking, communication, digital engagement, and on-property interactions. We continuously strive to uncover new opportunities to personalize the guest experience by listening to and truly understanding our guests – from the way we design our properties, to the way we cultivate and deliver our food and beverage offerings, to our holistic approach aimed at positively impacting our guests' and customers' wellbeing.

We develop loyalty by fostering personal relationships and creating emotional connections that inspire brand preference. We believe true loyalty is built through deep interpersonal connections, authenticity, care, and trust. The World of Hyatt loyalty program is designed to attract new guests, demonstrate loyalty to our existing guests, and build long lasting and meaningful relationships with guests. In addition, Hyatt's co-branded Visa credit cards with JP Morgan Chase Bank, N.A. increase the frequency and relevancy of member engagement with World of Hyatt.

Operate with Excellence

A key component of our strategy is to maximize revenues and manage costs at our managed hotel properties. We strive to optimize revenues by focusing on revenue management and establishing and increasing guest loyalty to our brands. We work to expand Hyatt's share of rooms revenues by continuously striving to provide genuine guest service and delivering value to our guests. Our existing customer base is diverse with different needs and preferences. We aim to provide differentiated service and product offerings targeted at each customer segment within each of our brands, including meeting planners and group business, leisure guests, and business travelers, in order to satisfy our customers' specific needs.

We manage costs by setting performance goals for our hotel management teams, optimizing distribution channels, and granting our general managers operational autonomy. We support these cost management efforts by providing our general managers with tools and analytics from our regional and corporate offices and by compensating our hotel management teams based on property performance. In addition to managing hotel level costs, we strive to keep corporate costs aligned with growth through efficient resource allocation, which we expect will generate savings supporting our ability to fund additional growth and further invest in our brands.

Grow with Intent

We are focused on creating long-term shareholder value and expanding our presence in targeted locations. The recognition of our brands and our reputation for service is larger than the scale of our presence around the world, and therefore, we have a unique opportunity to grow.

Increase Market Presence. We target our expansion efforts on under-penetrated markets where we already have an established presence and on locations where our guests are traveling, but where we do not have a presence. We intend to expand our presence by increasing the number of hotels in the Hyatt portfolio, primarily by entering into new management and franchise agreements. We believe our intense focus on each customer group that we serve and our understanding of how we can serve them in new locations will result in quality growth. Over the past few years, we have made significant progress in expanding our presence through development of new hotels, conversion of existing hotels, the integration of new brands such as those that were acquired in our acquisition of Two Roads Hospitality LLC ("Two Roads"), and through an alliance with Small Luxury Hotels of the World ("SLH"). Additionally, we are focused on continued growth of our development pipeline. We have expanded our pipeline by an average of over 14% per year since the time of our IPO in 2009. Since 2009, we have also entered 281 new markets and 24 new countries. Expansion in dynamic markets like Greater China and India is central to our growth strategy as representation in key cities and resort destinations provides us with the opportunity to drive preference for our brands as we serve a broader base of guests in these high growth and under-penetrated markets. At December 31, 2019, there were over 200 hotels open or under development in Greater China in markets such as Beijing, Hong Kong, Shanghai, and Shenzhen. In India, there were over 70 hotels open or under development at December 31, 2019. In addition to Greater China and India, we have also announced further expansion plans into diverse international markets including the Czech Republic, Turkey, Iceland, Finland, Spain, and Malaysia.

Expand Select Service Presence. We continue to expand the Hyatt House and Hyatt Place brands. In September 2019, we announced Caption by Hyatt, a new lifestyle brand within the select service category. The Caption by Hyatt brand will offer the efficiency and flexibility of select service, while creating a compelling lifestyle experience that is designed to foster organic connections between guests that enrich

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their wellbeing and result in optimal revenue opportunities. In June 2019, we announced the UrCove brand, which is positioned specifically to meet Chinese travelers' preferences and growing expectations for a seamless, comfortable, and premium travel experience. We believe that these brands will support our overall growth and enhance the performance of all of our brands. We intend to grow our select service presence through third-party construction of new franchised properties, conversion and renovation of existing non-Hyatt properties, and in limited cases, support of the development of new managed and franchised properties. We believe the opportunity for properties providing a select offering of services at a lower price point than full service hotels is particularly compelling in certain markets, including Greater China, India, and the Middle East, where there is a large and growing middle class along with a meaningful number of local business travelers. At December 31, 2019, we had 11 Hyatt House hotels and 57 Hyatt Place hotels operating outside of the United States in 7 and 22 countries, respectively, throughout Asia, Europe, Africa, and Latin America. In addition to these hotels, we have announced new management and franchise agreements for select service properties currently under development in Thailand, Vietnam, France, Germany, and the Dominican Republic.

Increase Focus on Franchising. We continue to increase our franchised hotel presence, primarily in the United States. By increasing our focus on franchising, we believe we will gain access to capital from developers and property owners who are specifically targeting franchise business opportunities. We have an internal team dedicated to supporting our franchise owners and driving the expansion of our franchised hotel presence. We plan to expand existing relationships and develop new relationships with franchisees who demonstrate an ability to provide excellent customer service and maintain our brand standards.

Utilize Our Capital and Asset Base for Targeted Growth. The combination of our significant liquidity and strong capital position coupled with our high quality asset base provides a unique platform to support our growth strategy. We take a comprehensive approach to our efforts to dispose of or recycle certain hotel real estate assets and to manage capital deployment in furtherance of our expansion plans. In late 2017, we committed to a reduction of our owned real estate portfolio, and through 2018, we realized approximately $1.5 billion of proceeds from the disposition of owned assets. In March 2019, we committed to an additional $1.5 billion reduction of our owned real estate portfolio over a three year period, and as of December 31, 2019, we have realized proceeds of almost $1 billion from the disposition of owned assets. Our intent is to use the proceeds to unlock shareholder value, provide funds for growth investments, return capital to shareholders, and accelerate the evolution of our earnings profile to be less capital intensive. Capital deployment will continue with an objective to maximize long-term shareholder value, and we will assess and balance liquidity, value, and strategic importance in each instance. We will continue to commit capital to fund the renovation of certain assets and expect to maintain some level of hotel ownership over time in our owned portfolio.

Pursue Strategic Acquisitions and Alliances. We evaluate potential acquisitions of other brands or hospitality management or franchising companies as a part of our efforts to expand our global presence. We focus on acquisitions that complement our ability to serve our existing customer base and enhance customer preference by providing a greater selection of locations, properties, and services. Furthermore, we may pursue these opportunities in alliance with existing or prospective owners of managed or franchised properties to strengthen our brand presence. In May 2019, we launched a loyalty collaboration with American Airlines in which elite members in both the American Airlines AAdvantage and World of Hyatt loyalty programs can be rewarded with more access to earning both points and miles on qualifying American flights and Hyatt hotel stays. In September 2019, we launched a loyalty collaboration with Lindblad Expeditions, a global provider of expedition cruises and adventure travel experiences, that provides World of Hyatt members with more unique ways to be rewarded for their loyalty beyond the traditional hotel stay by earning and redeeming World of Hyatt points. In November 2018, we completed the acquisition of Two Roads, a hotel management company with a unique collection of distinctive brands, properties, and a robust development pipeline around the globe. In the third quarter of 2018, we announced a strategic alliance with SLH. More than 300 participating SLH hotels around the globe have been added to the World of Hyatt loyalty program, and we will continue to add more hotels in many new markets to the World of Hyatt platform in 2020. This strategic alliance significantly enriches the benefits provided to members of the World of Hyatt loyalty program by providing additional stay opportunities at luxury quality hotels in many key markets which currently do not have a significant Hyatt presence (predominantly in Europe).


o	Extend Wellness Offerings. We continue our commitment to a holistic wellness strategy as an extension of our purpose and an important part of our growth strategy. We pilot and launch products, services, and

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platforms designed to positively and holistically impact our guests' and colleagues' wellbeing. Miraval and Exhale build a greater depth of expertise in wellness and mindfulness that extends to our hotel business and increases guest loyalty. Our collaboration with Headspace will bring mindfulness exercises, guided meditations, and sleep content to guests and colleagues around the world.

Description of Brands

Brand

Segment

Customer Base

December 31, 2019 Rooms (1)

Primary Selected
Competitors

Key Locations

% of Our
Managed and Franchised Properties (1)

Americas Region

ASPAC Region

EAME/SW Asia Region

Full
Service/
Luxury

Individual business and leisure travelers; small meetings

1,623

3,611

2,565

Four Seasons,
Ritz-Carlton,
Peninsula,
St. Regis,
Mandarin Oriental

Bangkok, Buenos Aires, St. Kitts,
New York, Paris, Vienna, Milan, Sydney, Washington D.C.

Wellness

Individual leisure travelers

<1%

410

—

Cal-a-vie, Canyon Ranch, Golden Door

Austin, Tucson

Full
Service/
Luxury

Individual business and leisure travelers; large and small meetings, social events

13%

12,278

13,710

4,035

Mandarin Oriental,
Shangri-La,
InterContinental,
Fairmont

Beijing, Berlin, Dubai, Hong Kong, Mumbai, Nassau, Rio de Janeiro, San Francisco, Shanghai, Tokyo

Full Service/ Upper-Upscale

Individual business and leisure travelers; small and large meetings, weddings, social events

1,434

296

Anantara, Banyan Tree, Como, Six Senses, One & Only

Anji, Bali, Bishangarth, Goa, Jabal Al Akhdar, Koh Russey Island, Surakarta, Wuzhen, Yangshuo

Full
Service/
Luxury

Individual business and leisure travelers; small meetings

2,180

1,053

1,775

Rosewood, Langham, Edition, 1 Hotels, W

Abu Dhabi, Amsterdam, Vienna, Munich, Maui, New York, Tokyo

Full
Service/
Luxury/Upper-Upscale

Individual business and leisure travelers; small meetings

3,131

644

1,484

Marriott Autograph Collection,

Starwood Luxury Collection,

Curio Collection by Hilton

Austin, Barcelona,

Cannes, Carmelo, Miami Beach, Nashville, New Orleans, Paris, Phoenix

Full Service/ Luxury/Upper-Upscale

Business and leisure travelers; large and small meetings, social events, associations

3,713

—

Marriott Autograph Collection, Curio Collection by Hilton, Starwood Luxury Collection

Aspen, Charleston,

Cle Elum,

Maui, Phoenix, Lake Tahoe

Full
Service/
Upper-Upscale

Conventions, business and leisure travelers; large and small meetings, social events, associations

39%

57,427

16,476

14,179

Marriott, Sheraton,
Hilton,
Renaissance,
Westin

Boston,
Chicago, Delhi, Dubai, Hong Kong, London,
Los Angeles, Mexico City, Orlando

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Brand	Segment	Customer Base	December 31, 2019 Rooms (1)				Primary Selected Competitors	Key Locations
Brand	Segment	Customer Base	% of Our Managed and Franchised Properties (1)	Americas Region	ASPAC Region	EAME/SW Asia Region	Primary Selected Competitors	Key Locations
	Full Service/ Upper-Upscale	Business and leisure travelers; small meetings	1%	1,315	—	743	Marriott, Hilton, InterContinental, Westin, independent and boutique hotels	New York, Paris, Seattle
	All-Inclusive	Leisure travelers; families; small meetings	1%	2,234	—	—	Beaches, Club Med, Sandals	Cancun, Puerto Vallarta, Rose Hall, San Jose del Cabo
	All-Inclusive	Leisure travelers; adult-only; small meetings	<1%	919	—	—	Beaches, Club Med, Sandals	Cancun, Rose Hall
	Full Service/ Luxury	Leisure travelers; couples; solo business travelers; small meetings	1%	2,205	—	—	W, Mondrian, The Standard, Edition, Hoxton, The James, Viceroy	Cabo San Lucas, Nashville, New York, Seattle, Washington D.C.
	Full Service/ Upper-Upscale	Business and leisure travelers; small meetings	3%	4,785	829	1,344	Canopy, Kimpton, Renaissance, independent and boutique hotels	Boston, Dublin, Madrid, Miami, Montevideo, New York, Tokyo
	Select Service/ Upscale	Business and leisure travelers; small meetings	—%	—	—	—	AC Hotels, Moxy, Aloft, Motto	—
	Full Service Upscale / Upper- Upscale	Leisure travelers; couples; families; solo business travelers; small meetings	1%	2,237	202	—	Kimpton, Canopy, Marriott Autograph Collection	Baltimore, Beijing Chicago, New York, San Francisco
	Select Service/ Upscale	Extended stay guests; business and leisure travelers; families; small meetings, trainings	6%	13,220	937	362	Residence Inn by Marriott, Homewood Suites	Austin, Boston, Dallas, Mexico City, Miami, San Francisco
	Select Service/ Upscale	Business and leisure travelers; small meetings	23%	45,045	4,530	2,884	Courtyard by Marriott, Hilton Garden Inn	Atlanta, Chicago, Dubai, Houston, London, Miami, Phoenix, Santiago, Shanghai
	Full Service/ Upper-Upscale	Leisure travelers; entrepreneurs; solo business travelers; small meetings

Closing Price ($)	Shares Out (MM)	Market Cap ($MM)
$0.00	107	$8,094

10-K	2020-02-20	Annual: 2019-12-31
10-Q	2019-10-31	Quarter: 2019-09-30
10-Q	2019-08-01	Quarter: 2019-06-30
10-Q	2019-05-02	Quarter: 2019-03-31
10-K	2019-02-14	Annual: 2018-12-31
10-Q	2018-10-31	Quarter: 2018-09-30
10-Q	2018-08-01	Quarter: 2018-06-30
10-Q	2018-05-03	Quarter: 2018-03-31
10-K	2018-02-15	Annual: 2017-12-31
10-Q	2017-11-02	Quarter: 2017-09-30
10-Q	2017-08-03	Quarter: 2017-06-30
10-Q	2017-05-04	Quarter: 2017-03-31
10-K	2017-02-16	Annual: 2016-12-31
10-Q	2016-11-03	Quarter: 2016-09-30
10-Q	2016-08-02	Quarter: 2016-06-30
10-Q	2016-05-03	Quarter: 2016-03-31
10-K	2016-02-18	Annual: 2015-12-31
10-Q	2015-11-03	Quarter: 2015-09-30
10-Q	2015-08-04	Quarter: 2015-06-30
10-Q	2015-05-05	Quarter: 2015-03-31
10-K	2015-02-18	Annual: 2014-12-31
10-Q	2014-10-29	Quarter: 2014-09-30
10-Q	2014-07-31	Quarter: 2014-06-30
10-Q	2014-04-30	Quarter: 2014-03-31
10-K	2014-02-18	Annual: 2013-12-31
10-Q	2013-10-30	Quarter: 2013-09-30
10-Q	2013-07-31	Quarter: 2013-06-30
10-Q	2013-05-01	Quarter: 2013-03-31
10-K	2013-02-13	Annual: 2012-12-31
10-Q	2012-10-31	Quarter: 2012-09-30
10-Q	2012-08-01	Quarter: 2012-06-30
10-Q	2012-05-03	Quarter: 2012-03-31
10-K	2012-02-16	Annual: 2011-12-31
10-Q	2011-11-02	Quarter: 2011-09-30
10-Q	2011-08-02	Quarter: 2011-06-30
10-Q	2011-05-03	Quarter: 2011-03-31
10-K	2011-02-17	Annual: 2010-12-31
10-Q	2010-11-03	Quarter: 2010-09-30
10-Q	2010-08-05	Quarter: 2010-06-30
10-Q	2010-05-06	Quarter: 2010-03-31
10-K	2010-02-25	Annual: 2009-12-31

8-K	2020-03-02	Regulation FD, Exhibits
8-K	2020-02-19	Earnings, Exhibits
8-K	2019-12-17	Regulation FD, Other Events
8-K	2019-11-05	Regulation FD
8-K	2019-10-30	Earnings, Exhibits
8-K	2019-09-12	Regulation FD
8-K	2019-08-07	Amend Bylaw, Other Events, Exhibits
8-K	2019-07-31	Earnings, Exhibits
8-K	2019-05-15	Shareholder Vote
8-K	2019-05-01	Earnings, Exhibits
8-K	2019-04-01	Officers
8-K	2019-03-05	Regulation FD, Exhibits
8-K	2019-02-13	Earnings, Exhibits
8-K	2018-12-12	Officers
8-K	2018-11-30	Enter Agreement, Regulation FD, Exhibits
8-K	2018-11-07	Amend Bylaw, Other Events, Exhibits
8-K	2018-11-05	Regulation FD
8-K	2018-10-30	Earnings, Other Events, Exhibits
8-K	2018-10-05	Enter Agreement, Officers, Regulation FD, Exhibits
8-K	2018-09-28	Regulation FD
8-K	2018-08-16	Enter Agreement, Other Events, Exhibits
8-K	2018-08-07	Regulation FD, Other Events, Exhibits
8-K	2018-07-31	Earnings, Exhibits
8-K	2018-05-31	Officers, Exhibits
8-K	2018-05-23	Other Events, Exhibits
8-K	2018-05-16	Amend Bylaw, Shareholder Vote, Exhibits
8-K	2018-05-04	Other Events, Exhibits
8-K	2018-05-02	Earnings, Exhibits
8-K	2018-03-29	M&A, Earnings, Regulation FD, Exhibits
8-K	2018-03-21	Officers, Exhibits
8-K	2018-02-19	Enter Agreement, Regulation FD, Exhibits
8-K	2018-02-15	Regulation FD, Exhibits
8-K	2018-02-14	Earnings, Other Events, Exhibits
8-K	2018-01-17	Officers, Other Events, Exhibits
8-K	2018-01-10	Enter Agreement, Earnings, Off-BS Arrangement, Exhibits

EX-3.1	a123119exhibit31.htm
EX-4.18	a123119exhibit418.htm
EX-10.14	a123119exhibit1014.htm
EX-14.1	hhccodeofbusinessconduct.htm
EX-21.1	a123119exhibit211.htm
EX-23.1	a123119exhibit231.htm
EX-31.1	a123119exhibit311.htm
EX-31.2	a123119exhibit312.htm
EX-32.1	a123119exhibit321.htm
EX-32.2	a123119exhibit322.htm
EX-99.1	a123119exhibit991.htm
EX-99.2	a123119exhibit992.htm