HILTON WORLDWIDE HOLDINGS INC., 10-Q filed on 8/1/2014
Quarterly Report
Document and Entity Information Document
6 Months Ended
Jun. 30, 2014
Jul. 28, 2014
Entity Information [Line Items]
 
 
Entity Registrant Name
Hilton Worldwide Holdings Inc. 
 
Entity Central Index Key
0001585689 
 
Current Fiscal Year End Date
--12-31 
 
Entity Filer Category
Non-accelerated Filer 
 
Document Type
10-Q 
 
Document Period End Date
Jun. 30, 2014 
 
Document Fiscal Period Focus
2014 
 
Document Fiscal Period Focus
Q2 
 
Amendment Flag
false 
 
Trading Symbol
hlt 
 
Entity Common Stock, Shares Outstanding
 
984,617,365 
Condensed Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Current Assets:
 
 
Cash and cash equivalents
$ 545 
$ 594 
Restricted cash and cash equivalents
284 
266 
Accounts receivable, net of allowance for doubtful accounts
858 
731 
Inventories
359 
396 
Deferred income tax assets
23 
23 
Current portion of financing receivables, net
52 
94 
Current portion of securitized financing receivables, net
65 
27 
Prepaid expenses
166 
148 
Other
65 
104 
Total current assets
2,417 
2,383 
Property, Investments and Other Assets:
 
 
Property and equipment, net
9,036 
9,058 
Financing receivables, net
359 
635 
Securitized financing receivables, net
462 
194 
Investments in affiliates
257 
260 
Goodwill
6,227 
6,220 
Brands
5,016 
5,013 
Management and franchise contracts, net
1,390 
1,452 
Other intangible assets, net
727 
751 
Deferred income tax assets
196 
193 
Other
410 
403 
Total property, investments and other assets
24,080 
24,179 
Total assets
26,497 
26,562 
Current Liabilities:
 
 
Accounts payable, accrued expenses and other
1,999 
2,079 
Current maturities of long-term debt
Current maturities of non-recourse debt
107 
48 
Income taxes payable
11 
11 
Total current liabilities
2,120 
2,142 
Long-term debt
11,314 
11,751 
Non-recourse debt
890 
920 
Deferred revenues
593 
674 
Deferred income tax liabilities
5,058 
5,053 
Liability for guest loyalty program
630 
597 
Other
1,145 
1,149 
Total liabilities
21,750 
22,286 
Commitments and contingencies - see Note 16
   
   
Equity:
 
 
Preferred stock
Common stock
10 
10 
Additional paid-in capital
10,009 
9,948 
Accumulated deficit
(4,999)
(5,331)
Accumulated other comprehensive loss
(186)
(264)
Total Hilton stockholders' equity
4,834 
4,363 
Noncontrolling interests
(87)
(87)
Total equity
4,747 
4,276 
Total liabilities and equity
$ 26,497 
$ 26,562 
Condensed Consolidated Balance Sheets (Parentheticals) (USD $)
In Millions, except Share data, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Statement of Financial Position [Abstract]
 
 
Allowance for doubtful accounts receivable
$ 30 
$ 32 
Variable interest entities - current assets
216 
97 
Variable interest entities - property, investments and other assets
694 
408 
Variable interest entities - current liabilities
219 
86 
Variable interest entities - liabilities
$ 987 
$ 583 
Preferred stock, par value (per share)
$ 0.01 
$ 0.01 
Preferred stock, authorized shares
3,000,000,000 
3,000,000,000 
Preferred stock, issued shares
Preferred stock, outstanding shares
Common stock, par value (per share)
$ 0.01 
$ 0.01 
Common stock, authorized shares
30,000,000,000 
30,000,000,000 
Common stock, issued shares
984,617,365 
984,615,364 
Common stock, outstanding shares
984,617,365 
984,615,364 
Condensed Consolidated Statements of Operations (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Revenues
 
 
 
 
Owned and leased hotels
$ 1,117 
$ 1,070 
$ 2,062 
$ 1,984 
Management and franchise fees and other
354 
299 
666 
561 
Timeshare
276 
261 
555 
507 
Other revenues from managed and franchised properties
920 
750 
1,747 
1,591 
Total revenues
2,667 
2,380 
5,030 
4,643 
Expenses
 
 
 
 
Owned and leased hotels
833 
804 
1,604 
1,547 
Timeshare
188 
181 
365 
351 
Depreciation and amortization
158 
149 
311 
309 
General, administrative and other
133 
92 
230 
189 
Other expenses from managed and franchised properties
920 
750 
1,747 
1,591 
Total expenses
2,232 
1,976 
4,257 
3,987 
Operating income
435 
404 
773 
656 
Interest income
Interest expense
(158)
(131)
(311)
(274)
Equity in earnings (losses) from unconsolidated affiliates
12 
Gain (loss) on foreign currency transactions
32 
(39)
46 
(82)
Other gain (loss), net
11 
(1)
14 
Income before income taxes
333 
241 
540 
317 
Income tax benefit (expense)
(121)
(84)
(204)
(122)
Net income (loss)
212 
157 
336 
195 
Net loss (income) attributable to noncontrolling interests
(3)
(2)
(4)
(6)
Net income (loss) attributable to Hilton Stockholders
$ 209 
$ 155 
$ 332 
$ 189 
Earnings per share:
 
 
 
 
Basic and diluted
$ 0.21 
$ 0.17 
$ 0.34 
$ 0.20 
Condensed Consolidated Statements of Comprehensive Income (Loss) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Statement of Comprehensive Income [Abstract]
 
 
 
 
Net income (loss)
$ 212 
$ 157 
$ 336 
$ 195 
Other comprehensive income (loss), net of tax:
 
 
 
 
Currency translation adjustment
53 
(18)
81 
(181)
Pension liability adjustment
12 
Cash flow hedge adjustment
(6)
 
(9)
 
Total other comprehensive income (loss)
50 
(10)
76 
(169)
Comprehensive income (loss)
262 
147 
412 
26 
Comprehensive loss (income) attributable to noncontrolling interests
(3)
(8)
(2)
(22)
Comprehensive income (loss) attributable to Hilton stockholders
$ 259 
$ 139 
$ 410 
$ 4 
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parentheticals) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Statement of Comprehensive Income [Abstract]
 
 
 
 
Foreign currency translation adjustment, tax
$ 66 
$ (31)
$ 102 
$ (155)
Pension liability adjustment, tax
(1)
(5)
(1)
(7)
Cash flow adjustment, tax
$ 3 
 
$ 5 
 
Condensed Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Operating Activities:
 
 
Net income
$ 336 
$ 195 
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
Depreciation and amortization
311 
309 
Equity in earnings from unconsolidated affiliates
(12)
(8)
Loss (gain) on foreign currency transactions
(46)
82 
Other gain, net
(14)
(6)
Share-based compensation
41 
Distributions from unconsolidated affiliates
11 
10 
Deferred income taxes
(42)
25 
Change in restricted cash and cash equivalents
(1)
(46)
Working capital changes and other
(72)
74 
Net cash provided by operating activities
512 
638 
Investing Activities:
 
 
Capital expenditures for property and equipment
(110)
(121)
Acquisitions
(30)
Payments received on other financing receivables
Issuance of other financing receivables
(1)
(7)
Investments in affiliates
(5)
(3)
Distributions from unconsolidated affiliates
11 
13 
Proceeds from asset dispositions
35 
Contract acquisition costs
(21)
(10)
Software capitalization costs
(32)
(26)
Net cash used in investing activities
(121)
(183)
Financing Activities:
 
 
Borrowings
350 
451 
Repayment of debt
(783)
(952)
Debt issuance costs
(2)
Change in restricted cash and cash equivalents
(17)
(30)
Capital contribution
13 
Distributions to noncontrolling interests
(2)
(3)
Net cash used in financing activities
(441)
(534)
Effect of exchange rate changes on cash and cash equivalents
(15)
Net increase (decrease) in cash and cash equivalents
(49)
(94)
Cash and cash equivalents, beginning of period
594 
755 
Cash and cash equivalents, end of period
545 
661 
Supplemental Disclosures:
 
 
Interest
257 
288 
Income taxes, net of refunds
141 
40 
Non-Cash Capital Lease Asset Increase
11 
 
Non-Cash Capital Lease Asset Reduction
 
(44)
Non-Cash Capital Lease Obligation Increase
11 
 
Non-Cash Capital Lease Obligation Reduction
 
$ (48)
Condensed Consolidated Statements of Stockholders' Equity (USD $)
In Millions, except Share data, unless otherwise specified
Total
Common Stock [member]
Additional Paid-in Capital [member]
Accumulated Deficit [member]
Accumulated Other Comprehensive Income (Loss) [member]
Noncontrolling Interest [member]
Balance at Dec. 31, 2012
$ 2,155 
$ 1 
$ 8,452 
$ (5,746)
$ (406)
$ (146)
Balance (shares) at Dec. 31, 2012
 
921,000,000 
 
 
 
 
Net income (loss)
195 
 
 
189 
 
Other comprehensive income (loss), net of tax:
 
 
 
 
 
 
Currency translation adjustment
(181)
 
 
 
(197)
16 
Pension liability adjustment
12 
 
 
 
12 
 
Total other comprehensive income (loss)
(169)
 
 
 
(185)
16 
Distributions
(3)
 
 
 
 
(3)
Balance at Jun. 30, 2013
2,178 
8,452 
(5,557)
(591)
(127)
Balance (shares) at Jun. 30, 2013
 
921,000,000 
 
 
 
 
Balance at Dec. 31, 2013
4,276 
10 
9,948 
(5,331)
(264)
(87)
Balance (shares) at Dec. 31, 2013
984,615,364 
985,000,000 
 
 
 
 
Net income (loss)
336 
 
 
332 
 
Other comprehensive income (loss), net of tax:
 
 
 
 
 
 
Currency translation adjustment
81 
 
 
 
83 
(2)
Pension liability adjustment
 
 
 
 
Cash flow hedge adjustment
(9)
 
 
 
(9)
 
Total other comprehensive income (loss)
76 
 
 
 
78 
(2)
Share-based compensation
48 
 
48 
 
 
 
Capital contribution
13 
 
13 
 
 
 
Distributions
(2)
 
 
 
 
(2)
Balance at Jun. 30, 2014
$ 4,747 
$ 10 
$ 10,009 
$ (4,999)
$ (186)
$ (87)
Balance (shares) at Jun. 30, 2014
984,617,365 
985,000,000 
 
 
 
 
Organization and Basis of Presentation
Organization and Basis of Presentation
Organization and Basis of Presentation

Organization

Hilton Worldwide Holdings Inc. ("Hilton" together with its subsidiaries, "we," "us," "our" or the "Company"), a Delaware corporation, is one of the largest hospitality companies in the world based upon the number of hotel rooms and timeshare units under our 11 distinct brands. We are engaged in owning, leasing, managing, developing and franchising hotels, resorts and timeshare properties. As of June 30, 2014, we owned, leased, managed or franchised 4,158 hotel and resort properties, totaling 687,222 rooms in 93 countries and territories, as well as 44 timeshare properties comprising 6,758 units.

In December 2013, we completed a 9,205,128-for-1 stock split on issued and outstanding shares, which is reflected in all share and per share data presented in our condensed consolidated financial statements and accompanying notes.

Basis of Presentation and Use of Estimates

The accompanying condensed consolidated financial statements for the three and six months ended June 30, 2014 and 2013 have been prepared in accordance with United States of America ("U.S.") generally accepted accounting principles ("GAAP") and are unaudited. We have condensed or omitted certain information and footnote disclosures normally included in financial statements presented in accordance with U.S. GAAP. Although we believe the disclosures made are adequate to prevent the information presented from being misleading, these financial statements should be read in conjunction with the consolidated financial statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended December 31, 2013.

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported and, accordingly, ultimate results could differ from those estimates. Interim results are not necessarily indicative of full year performance.

In our opinion, the accompanying condensed consolidated financial statements reflect all adjustments, including normal recurring items, considered necessary for a fair presentation of the interim periods. All material intercompany transactions have been eliminated in consolidation.
Recently Issued Accounting Pronouncements
Recently Issued Accounting Pronouncements
Note 2: Recently Issued Accounting Pronouncements

Adopted Accounting Standards

In July 2013, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2013-11 ("ASU 2013-11"), Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This ASU provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists in the applicable jurisdiction to settle any additional income taxes that would result from disallowance of the tax position. The provisions of ASU 2013-11 were effective, prospectively, for reporting periods beginning after December 15, 2013. As a result of our adoption of this ASU on January 1, 2014, $108 million of unrecognized tax benefits were reclassified against deferred income tax assets.

In March 2013, the FASB issued ASU No. 2013-05 ("ASU 2013-05"), Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This ASU clarifies when a cumulative translation adjustment should be released to net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real estate) within a foreign entity. The provisions of ASU 2013-05 were effective, prospectively, for reporting periods beginning after December 15, 2013. The adoption did not have a material effect on our condensed consolidated financial statements.

Accounting Standards Not Yet Adopted

In May 2014, the FASB issued ASU No. 2014-09 ("ASU 2014-09"), Revenue from Contracts with Customers (Topic 606). This ASU supersedes the revenue recognition requirements in "Revenue Recognition (Topic 605)," and requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The provisions of ASU 2014-09 are effective for annual periods beginning after December 15, 2016, including interim periods within that reporting period and are to be applied retrospectively; early application is not permitted. We are currently evaluating the effect that this ASU will have on our consolidated financial statements.

In April 2014, the FASB issued ASU No. 2014-08 ("ASU 2014-08"), Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. This ASU amends guidance on reporting discontinued operations only if the disposal of a component of an entity or group of components of an entity represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. The provisions of ASU 2014-08 should be applied prospectively for all disposals of components of an entity and for all businesses that, on acquisition, are classified as held for sale that occurred within annual periods beginning on or after December 15, 2014, and interim periods within. The adoption of ASU 2014-08 is not expected to materially affect our consolidated financial statements.
Property and Equipment
Property and Equipment
Property and Equipment

Property and equipment were as follows:    
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Land
$
4,097

 
$
4,098

Buildings and leasehold improvements
5,609

 
5,511

Furniture and equipment
1,193

 
1,172

Construction-in-progress
81

 
67

 
10,980

 
10,848

Accumulated depreciation and amortization
(1,944
)
 
(1,790
)
 
$
9,036

 
$
9,058



Depreciation and amortization expense on property and equipment, including amortization of assets recorded under capital leases, was $79 million and $77 million during the three months ended June 30, 2014 and 2013, respectively, and $156 million and $166 million during the six months ended June 30, 2014 and 2013, respectively.

As of June 30, 2014 and December 31, 2013, property and equipment included approximately $150 million and $130 million, respectively, of capital lease assets primarily consisting of buildings and leasehold improvements, net of $65 million and $59 million, respectively, of accumulated depreciation and amortization.

In April 2014, we completed the sale of certain land and easement rights to a related party in connection with a timeshare project. In addition, the related party acquired the rights to the name, plans, designs, contracts and other documents related to the timeshare project. The total consideration received for this transaction was approximately $37 million. We recognized $13 million, net of tax, as a capital contribution within additional paid-in capital, representing the excess of the fair value of the consideration received over the carrying value of the assets sold.

During the six months ended June 30, 2014, we completed the sale of one hotel for approximately $4 million and a vacant parcel of land for approximately $6 million. As a result of these sales, we recognized a pre-tax gain of $12 million, including the reclassification of a currency translation adjustment of $4 million, which was previously recognized in accumulated other comprehensive loss. The gain was included in other gain (loss), net in our condensed consolidated statement of operations.

During the six months ended June 30, 2013, we acquired a parcel of land for $28 million, which we previously leased under a long-term ground lease.
Financing Receivables
Financing Receivables
Financing Receivables

Financing receivables were as follows:
 
June 30, 2014
 
Securitized Timeshare
 
Unsecuritized Timeshare
 
Other
 
Total
 
(in millions)
Financing receivables
$
491

 
$
370

 
$
40

 
$
901

Less: allowance
(29
)
 
(50
)
 
(1
)
 
(80
)
 
462

 
320

 
39

 
821

 
 
 
 
 
 
 
 
Current portion of financing receivables
69

 
58

 
2

 
129

Less: allowance
(4
)
 
(8
)
 

 
(12
)
 
65

 
50

 
2

 
117

 
 
 
 
 
 
 
 
Total financing receivables
$
527

 
$
370

 
$
41

 
$
938


 
December 31, 2013
 
Securitized Timeshare
 
Unsecuritized Timeshare
 
Other
 
Total
 
(in millions)
Financing receivables
$
205

 
$
654

 
$
49

 
$
908

Less: allowance
(11
)
 
(67
)
 
(1
)
 
(79
)
 
194

 
587

 
48

 
829

 
 
 
 
 
 
 
 
Current portion of financing receivables
29

 
106

 

 
135

Less: allowance
(2
)
 
(12
)
 

 
(14
)
 
27

 
94

 

 
121

 
 
 
 
 
 
 
 
Total financing receivables
$
221

 
$
681

 
$
48

 
$
950



Timeshare Financing Receivables

As of June 30, 2014, we had 51,840 timeshare financing receivables with interest rates ranging from zero to 20.50 percent, a weighted average interest rate of 12.16 percent, a weighted average remaining term of 7.4 years and maturities through 2025. As of June 30, 2014 and December 31, 2013, we had ceased accruing interest on timeshare financing receivables with aggregate principal balances of $31 million and $32 million, respectively.

In June 2014, we completed a securitization of approximately $357 million of gross timeshare financing receivables and issued approximately $304 million of 1.77 percent notes and approximately $46 million of 2.07 percent notes, which have a stated maturity date in November 2026. The securitization transaction did not qualify as a sale for accounting purposes and, accordingly, no gain or loss was recognized. In August 2013, we completed a securitization of approximately $255 million of gross timeshare financing receivables and issued $250 million of 2.28 percent notes that have a stated maturity date in January 2026. The proceeds from both transactions are presented as debt (collectively, the "Securitized Timeshare Debt"). See Note 7: "Debt" for additional details.

In May 2013, we entered into a revolving non-recourse timeshare financing receivables credit facility ("Timeshare Facility") that is secured by certain of our timeshare financing receivables. As of June 30, 2014 and December 31, 2013, we had $169 million and $492 million, respectively, of gross timeshare financing receivables secured under our Timeshare Facility.

The changes in our allowance for uncollectible timeshare financing receivables were as follows:
 
Six Months Ended June 30,
 
2014
 
2013
 
(in millions)
Beginning balance
$
92

 
$
93

Write-offs
(16
)
 
(11
)
Provision for uncollectibles on sales
15

 
13

Ending balance
$
91

 
$
95



Our timeshare financing receivables as of June 30, 2014 mature as follows:
 
Securitized Timeshare
 
Unsecuritized Timeshare
Year
(in millions)
2014 (remaining)
$
34

 
$
35

2015
70

 
45

2016
73

 
48

2017
75

 
49

2018
75

 
48

Thereafter
233

 
203

 
560

 
428

Less: allowance
(33
)
 
(58
)
 
$
527

 
$
370



The following table details an aged analysis of our gross timeshare financing receivables balance:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Current
$
947

 
$
948

30 - 89 days past due
10

 
14

90 - 119 days past due
3

 
4

120 days and greater past due
28

 
28

 
$
988

 
$
994

Investments in Affiliates
Investments in Affiliates
Investments in Affiliates

Investments in affiliates were as follows:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Equity investments
$
240

 
$
245

Other investments
17

 
15

 
$
257

 
$
260



We maintain investments in affiliates accounted for under the equity method, which are primarily investments in entities that owned or leased 27 and 30 hotels as of June 30, 2014 and December 31, 2013, respectively. These entities had total debt of approximately $1.0 billion and $1.1 billion as of June 30, 2014 and December 31, 2013, respectively. Substantially all of the debt is secured solely by the affiliates' assets or is guaranteed by other partners without recourse to us. We were the creditor on $17 million of debt from unconsolidated affiliates as of June 30, 2014 and December 31, 2013, which was included in financing receivables, net in our condensed consolidated balance sheets.
Consolidated Variable Interest Entities
Consolidated Variable Interest Entities
Consolidated Variable Interest Entities

As of June 30, 2014 and December 31, 2013, we consolidated five and four variable interest entities ("VIEs"), respectively. During the six months ended June 30, 2014 and 2013, we did not provide any financial or other support to any VIEs that we were not previously contractually required to provide, nor do we intend to provide such support in the future.

Two of these VIEs lease hotels from unconsolidated affiliates in Japan. We hold a significant ownership interest in these VIEs and have the power to direct the activities that most significantly affect their economic performance. Our condensed consolidated balance sheets included the assets and liabilities of these entities, which primarily comprised $34 million and $42 million of cash and cash equivalents, $38 million and $26 million of property and equipment, net, and $287 million and $284 million of non-recourse debt as of June 30, 2014 and December 31, 2013, respectively. The assets of these entities are only available to settle the obligations of these entities. Interest expense related to the non-recourse debt of these two consolidated VIEs was $5 million and $7 million during the three months ended June 30, 2014 and 2013, respectively, and $10 million and $15 million during the six months ended June 30, 2014 and 2013, respectively, and was included in interest expense in our condensed consolidated statements of operations.

In February 2013, one of our consolidated VIEs in Japan signed a Memorandum of Understanding to restructure the terms of its capital lease. The effect of the capital lease restructuring was recognized during the three months ended March 31, 2013, resulting in a reduction in property and equipment, net of $44 million and a reduction in non-recourse debt of $48 million.

In August 2013 and June 2014, we formed VIEs associated with each of our securitization transactions to issue our Securitized Timeshare Debt. We are the primary beneficiaries of these VIEs as we have the power to direct the activities that most significantly affect their economic performance, the obligation to absorb their losses and the right to receive benefits that are significant to them. As of June 30, 2014 and December 31, 2013, our condensed consolidated balance sheets included the assets and liabilities of these entities, which primarily comprised $22 million and $8 million of restricted cash and cash equivalents, $527 million and $221 million of securitized financing receivables, net and $548 million and $222 million of non-recourse debt, respectively. Our condensed consolidated statements of operations for the three and six months ended June 30, 2014 included interest income related to these VIEs of $12 million and $19 million, respectively, included in timeshare revenue, and interest expense related to these VIEs of $2 million and $3 million, respectively, included in interest expense. See Note 4: "Financing Receivables" and Note 7: "Debt" for additional details.

We have an additional consolidated VIE that owns one hotel that was immaterial to our condensed consolidated financial statements.
Debt
Debt
Debt

Long-term Debt

Long-term debt balances, including obligations for capital leases, and associated interest rates were as follows:

June 30,
 
December 31,

2014
 
2013

(in millions)
Senior secured term loan facility with a rate of 3.50%, due 2020
$
5,550

 
$
6,000

Senior notes with a rate of 5.625%, due 2021
1,500

 
1,500

Commercial mortgage-backed securities loan with an average rate of 4.05%, due 2018(1)
3,500

 
3,500

Mortgage loan with a rate of 2.30%, due 2018
525

 
525

Mortgage notes with an average rate of 6.15%, due 2016
132

 
133

Other unsecured notes with a rate of 7.50%, due 2017
54

 
53

Capital lease obligations with an average rate of 6.04%, due 2015 to 2097
82

 
73


11,343


11,784

Less: current maturities of long-term debt
(3
)

(4
)
Less: unamortized discount on senior secured term loan facility
(26
)
 
(29
)

$
11,314


$
11,751

____________
(1) 
The initial maturity date of the variable-rate component of this borrowing is November 1, 2015. We assumed all extensions, which are solely at our option, were exercised.

During the six months ended June 30, 2014, we made voluntary prepayments of $450 million on our senior secured term loan facility (the "Term Loans").

As of June 30, 2014, we had $48 million of letters of credit outstanding under our $1.0 billion senior secured revolving credit facility (the "Revolving Credit Facility"), and a borrowing capacity of $952 million.

Under our commercial mortgage-backed securities loan secured by 23 of our U.S. owned real estate assets (the "CMBS Loan"), we are required to deposit with the lender certain cash reserves for restricted uses. As of June 30, 2014 and December 31, 2013, our condensed consolidated balance sheets included $33 million and $29 million, respectively, of restricted cash and cash equivalents related to the CMBS Loan.

Non-recourse Debt

Non-recourse debt, including obligations for capital leases, and associated interest rates were as follows:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Capital lease obligations of consolidated VIEs with a rate of 6.34%, due 2018 to 2026
$
259

 
$
255

Non-recourse debt of consolidated VIEs with an average rate of 3.38%, due 2015 to 2018(1)
40

 
41

Timeshare Facility with a rate of 1.48%, due 2016
150

 
450

Securitized Timeshare Debt with an average rate of 1.98%, due 2026
548

 
222

 
997

 
968

Less: current maturities of non-recourse debt
(107
)
 
(48
)
 
$
890

 
$
920

____________
(1) 
Excludes the non-recourse debt of our VIEs that issued the Securitized Timeshare Debt, as this is presented separately.

In June 2014, we issued approximately $304 million of 1.77 percent notes and $46 million of 2.07 percent notes due November 2026, which are secured by a pledge of certain assets, consisting primarily of a pool of our timeshare financing receivables that are secured by a first mortgage or first deed of trust on a timeshare interest. We are required to make monthly payments of principal and interest under the notes. A majority of the proceeds from the asset-backed notes were used to reduce the outstanding balance on our Timeshare Facility.

We are required to deposit payments received from customers on the pledged timeshare financing receivables and securitized timeshare financing receivables related to the Timeshare Facility and Securitized Timeshare Debt, respectively, into a depository account maintained by a third party. On a monthly basis, the depository account will first be utilized to make any required principal, interest and other payments due with respect to the Timeshare Facility and Securitized Timeshare Debt. After payment of all amounts due under the respective agreements, any remaining amounts will be remitted to us for use in our operations. The balance in the depository account, totaling $27 million and $20 million as of June 30, 2014 and December 31, 2013, respectively, was included in restricted cash and cash equivalents in our condensed consolidated balance sheets.

Debt Maturities

The contractual maturities of our long-term debt and non-recourse debt as of June 30, 2014 were as follows:
Year
(in millions)
2014 (remaining)
$
61

2015
109

2016
363

2017
139

2018(1)
4,110

Thereafter
7,558

 
$
12,340

____________
(1) 
The CMBS Loan has three one-year extensions, solely at our option, that effectively extend maturity to November 1, 2018. We assumed all extensions for purposes of calculating maturity dates.
Derivative Instruments and Hedging Activities
Derivative Instruments and Hedging Activities
Derivative Instruments and Hedging Activities

During the six months ended June 30, 2014 and 2013, derivatives were used to hedge the interest rate risk associated with variable-rate debt. Certain of our loan agreements require us to hedge interest rate risk using derivative instruments.

Cash Flow Hedges

As of June 30, 2014, we held four interest rate swaps with an aggregate notional amount of $1.45 billion, which swap three-month LIBOR on the Term Loans to a fixed rate of 1.87 percent and expire in October 2018. We elected to designate these interest rate swaps as cash flow hedges for accounting purposes.

Non-designated Hedges

As of June 30, 2014, we held one interest rate cap in the notional amount of $875 million, for the variable-rate component of the CMBS Loan, that expires in November 2015 and caps one-month LIBOR at 6.0 percent. We also held one interest rate cap in the notional amount of $525 million that expires in November 2015 and caps one-month LIBOR on a mortgage loan secured by one property at 4.0 percent. We did not elect to designate either of these interest rate caps as hedging instruments.

As of June 30, 2013, we held ten interest rate caps with an aggregate notional amount of $15.2 billion, which matured in November 2013. We did not elect to designate any of these ten interest rate caps as effective hedging instruments.

Fair Value of Derivative Instruments

The effects of our derivative instruments on our condensed consolidated balance sheets were as follows:
 
June 30, 2014
 
December 31, 2013
 
Balance Sheet Classification
 
Fair Value
 
Balance Sheet Classification
 
Fair Value
 
 
 
(in millions)
 
 
 
(in millions)
Cash Flow Hedges:
 
 
 
 
 
 
 
Interest rate swaps
Other liabilities
 
$
5

 
Other assets
 
$
10

 
 
 
 
 
 
 
 
Non-designated Hedges:
 
 
 
 
 
 
 
Interest rate caps
Other assets
 

 
Other assets
 



Earnings Effect of Derivative Instruments

The effects of our derivative instruments on our condensed consolidated statements of operations and condensed consolidated statements of comprehensive income (loss) before any effect for income taxes were as follows:
 
 
 
Three Months Ended
 
Six Months Ended
 
 
 
June 30,
 
June 30,
 
Classification of Loss Recognized
 
2014
 
2013
 
2014

2013
 
 
 
(in millions)
Cash Flow Hedges:
 
 
 
 
 
 
 
 
 
Interest rate swaps(1)
Other comprehensive loss
 
$
(9
)
 
$

 
$
(14
)
 
$

 
 
 
 
 
 
 
 
 
 
Non-designated Hedges:
 
 
 
 
 
 
 
 
 
Interest rate caps
Other gain (loss), net
 

 

 

 

____________
(1) 
There were no amounts recognized in earnings related to hedge ineffectiveness or amounts excluded from hedge effectiveness testing during the three and six months ended June 30, 2014.
Fair Value Measurements
Fair Value Measurements
Fair Value Measurements

The carrying amounts and estimated fair values of our financial assets and liabilities, including related current portions, were as follows:

 
June 30, 2014
 
 
 
Hierarchy Level
 
Carrying Amount
 
Level 1
 
Level 2
 
Level 3
 
(in millions)
Assets:
 
 
 
 
 
 
 
Cash equivalents
$
291

 
$

 
$
291

 
$

Restricted cash equivalents
94

 

 
94

 

Timeshare financing receivables
988

 

 

 
990

Liabilities:
 
 
 
 
 
 
 
Long-term debt(1)
11,235

 
59

 
1,598

 
9,862

Non-recourse debt(2)
698

 

 

 
701

Interest rate swaps
5

 

 
5

 


 
December 31, 2013
 
 
 
Hierarchy Level
 
Carrying Amount
 
Level 1
 
Level 2
 
Level 3
 
(in millions)
Assets:
 
 
 
 
 
 
 
Cash equivalents
$
309

 
$

 
$
309

 
$

Restricted cash equivalents
107

 

 
107

 

Timeshare financing receivables
994

 

 

 
996

Interest rate swaps
10

 

 
10

 

Liabilities:
 
 
 
 
 
 
 
Long-term debt(1)
11,682

 
57

 
1,560

 
10,358

Non-recourse debt(2)
672

 

 

 
670

____________
(1)
Excludes capital lease obligations with a carrying value of $82 million and $73 million as of June 30, 2014 and December 31, 2013, respectively.
(2)
Represents the Securitized Timeshare Debt and the Timeshare Facility.

We believe the carrying amounts of our current financial assets and liabilities and other financing receivables approximated fair value as of June 30, 2014 and December 31, 2013. Our estimates of the fair values were determined using available market information and appropriate valuation methods. Considerable judgment is necessary to interpret market data and develop the estimated fair values. Proper classification of fair value measurements within the valuation hierarchy is considered each reporting period. The use of different market assumptions or estimation methods may have a material effect on the estimated fair value amounts.

Cash equivalents and restricted cash equivalents primarily consisted of short-term interest-bearing money market funds with maturities of less than 90 days, time deposits and commercial paper. The estimated fair values were based on available market pricing information of similar financial instruments.

The estimated fair values of our timeshare financing receivables were based on the expected future cash flows discounted at risk-adjusted rates. The primary sensitivity in these calculations is based on the selection of appropriate discount rates. Fluctuations in these assumptions will result in different estimates of fair value. An increase in the discount rates would result in a decrease in the fair values.

We measure our interest rate swaps at fair value, which were estimated using an income approach. The primary inputs into our fair value estimate include interest rates and yield curves based on observable market inputs of similar instruments.

The estimated fair values of our Level 1 long-term debt were based on prices in active debt markets. The estimated fair values of our Level 2 long-term debt were based on bid prices in a non-active debt market. The estimated fair values of our Level 3 fixed-rate long-term debt were estimated based on the expected future cash flows discounted at risk-adjusted rates. The primary sensitivity in these estimates is based on the selection of appropriate discount rates. Fluctuations in these assumptions will result in different estimates of fair value. An increase in the discount rates would result in a decrease in the fair values. The carrying amounts of our Level 3 variable-rate long-term debt and non-recourse debt approximated fair value as the interest rates under the loan agreements approximated current market rates. The estimated fair values of our Level 3 fixed-rate non-recourse debt were primarily based on indicative quotes received for similar issuances.

No financial or nonfinancial assets were measured at fair value on a nonrecurring basis as of June 30, 2014.
Income Taxes
Income Taxes
Income Taxes

At the end of each quarter we estimate the effective tax rate expected to be applied for the full year. The effective income tax rate is determined by the level and composition of pre-tax income or loss, which is subject to federal, foreign, state and local income taxes and reflects income tax expense or benefit resulting from our significant operations outside of the U.S.

Our total unrecognized tax benefits as of June 30, 2014 and December 31, 2013 were $379 million and $435 million, respectively. We had accrued balances of approximately $17 million and $45 million for the payment of interest and penalties as of June 30, 2014 and December 31, 2013, respectively. We recognize interest and penalties accrued related to unrecognized tax benefits in income tax expense. The net decrease to unrecognized tax benefits of $56 million and accrued interest and penalties of $28 million relates to a reduction to uncertain tax positions for calendar years 2006 and 2007 that were effectively settled during the second quarter in connection with the receipt of a Revenue Agent Report from the Internal Revenue Service ("IRS").

As a result of the expected resolution of examination issues with federal, state and foreign tax authorities, we believe it is reasonably possible that during the next 12 months the amount of unrecognized tax benefits will decrease up to $1 million. Included in the balance of unrecognized tax benefits as of June 30, 2014 and December 31, 2013 were $342 million and $340 million, respectively, associated with positions that, if favorably resolved, would provide a benefit to our effective tax rate.

We file income tax returns, including returns for our subsidiaries, with federal, state and foreign jurisdictions. We are under regular and recurring audit by the IRS on open tax positions. The timing of the resolution of tax audits is highly uncertain, as are the amounts, if any, that may ultimately be paid upon such resolution. Changes may result from the conclusion of ongoing audits, appeals or litigation in state, local, federal and foreign tax jurisdictions or from the resolution of various proceedings between the U.S. and foreign tax authorities. We are no longer subject to U.S. federal income tax examination for years through 2004. As of June 30, 2014, we remain subject to federal examinations from 2005-2012, state examinations from 1999-2012 and foreign examinations of our income tax returns for the years 1996 through 2013. State income tax returns are generally subject to examination for a period of three to five years after filing the respective return; however, the state effect of any federal tax return changes remains subject to examination by various states for a period generally of up to one year after formal notification to the states. The statute of limitations for the foreign jurisdictions generally ranges from three to ten years after filing the respective tax return.
Employee Benefit Plans
Employee Benefit Plans
Employee Benefit Plans

We sponsor multiple domestic and international employee benefit plans. Benefits are based upon years of service and compensation.

We have a noncontributory retirement plan in the U.S. (the "Domestic Plan"), which covers certain employees not earning union benefits. This plan was frozen for participant benefit accruals in 1996. We also have multiple employee benefit plans that cover many of our international employees. These include a plan that covers workers in the United Kingdom (the "U.K. Plan"), which was frozen to further accruals in November 2013, and a number of smaller plans that cover workers in various other countries around the world (the "International Plans").

The components of net periodic pension cost (credit) for the Domestic Plan, U.K. Plan and International Plans were as follows:
 
Three Months Ended June 30,
 
2014
 
2013
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
(in millions)
Service cost
$
2

 
$

 
$
1

 
$
1

 
$
1

 
$

Interest cost
4

 
4

 
1

 
5

 
4

 
1

Expected return on plan assets
(5
)
 
(6
)
 
(1
)
 
(6
)
 
(6
)
 
(1
)
Amortization of prior service cost
1

 

 

 
1

 

 

Amortization of net loss
1

 

 

 
1

 
1

 
1

Settlement losses
1

 

 

 

 

 

Net periodic pension cost (credit)
$
4

 
$
(2
)
 
$
1

 
$
2

 
$

 
$
1



 
Six Months Ended June 30,
 
2014
 
2013
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
(in millions)
Service cost
$
4

 
$

 
$
2

 
$
2

 
$
2

 
$
1

Interest cost
8

 
9

 
2

 
9

 
8

 
2

Expected return on plan assets
(9
)
 
(12
)
 
(2
)
 
(10
)
 
(11
)
 
(2
)
Amortization of prior service cost (credit)
2

 

 

 
2

 
(1
)
 

Amortization of net loss
1

 

 

 
2

 
2

 
1

Settlement losses
1

 

 

 

 

 
1

Net periodic pension cost (credit)
$
7

 
$
(3
)
 
$
2

 
$
5

 
$

 
$
3



We have an outstanding bond of $76 million under a class action lawsuit against Hilton and the Domestic Plan to support potential future plan contributions from us. We funded an account, which is classified as restricted cash and cash equivalents in our condensed consolidated balance sheets, to support this requirement. If the U.S. District Court for the District of Columbia approves of our compliance with the requirements of the ruling from the class action lawsuit, then the bond may be released in 2014.
Share-Based Compensation
Share-Based Compensation
Share-Based Compensation

2013 Omnibus Incentive Plan

In February 2014, we issued time-vesting restricted stock units ("RSUs"), nonqualified stock options ("options") and performance-vesting restricted stock units ("performance shares") under the 2013 Omnibus Incentive Plan.

We recorded share-based compensation expense for awards granted under the 2013 Omnibus Incentive Plan of $24 million and $35 million during the three and six months ended June 30, 2014, respectively, which includes amounts reimbursed by hotel owners. As of June 30, 2014, unrecognized compensation costs for unvested awards was approximately $146 million, which is expected to be recognized over a weighted-average period of 2.2 years on a straight-line basis.

As of June 30, 2014, there were 72,404,038 shares of common stock available for future issuance under the 2013 Omnibus Incentive Plan.

Restricted Stock Units

During the six months ended June 30, 2014, we issued 7,066,153 RSUs with a grant-date fair value of $21.53. The RSUs vest in annual installments over two or three years from the date of grant, subject to the individual’s continued employment through the applicable vesting date. Vested RSUs generally will be settled for our common stock, with the exception of certain awards that will be settled in cash.

Stock Options

During the six months ended June 30, 2014, we issued 1,003,591 options with an exercise price of $21.53. As of June 30, 2014, no options were exercisable. The options vest over three years in equal installments from the date of grant, subject to the individual’s continued employment through the applicable vesting date, and will terminate 10 years from the date of grant or earlier if the individual’s service terminates. The exercise price is equal to the closing price of the Company’s common stock on the date of grant. The grant date fair value of each of these option grants was $7.58, which was determined using the Black-Scholes-Merton option-pricing model.

Performance Shares

During the six months ended June 30, 2014, we issued 1,078,908 performance shares. The performance shares are settled at the end of the three-year performance period with 50 percent of the shares subject to achievement based on a measure of (1) the Company’s total shareholder return relative to the total shareholder returns of members of a peer company group ("relative shareholder return") and the other 50 percent of the shares subject to achievement based on (2) the Company’s earnings before interest expense, taxes and depreciation and amortization ("EBITDA") compound annual growth rate ("EBITDA CAGR"). The total number of performance shares that vest based on each performance measure (relative shareholder return and EBITDA CAGR) is based on an achievement factor that in each case, ranges from a zero to 200 percent payout.

The grant date fair value of each of the performance shares based on relative shareholder return was $23.56, which was determined using a Monte Carlo simulation valuation model. The grant-date fair value of each of the performance shares based on our EBITDA CAGR was $21.53. For these shares, we determined that the performance condition is probable of achievement and during the three and six months ended June 30, 2014, we recognized compensation expense over the vesting period at the target amount of 100 percent. As of June 30, 2014, 1,078,908 performance shares were outstanding with a remaining life of 2.5 years.

Promote Plan

Prior to December 2013, certain members of our senior management team participated in an executive compensation
plan (the "Promote plan"). Equity awards under the Promote plan were exchanged for restricted shares of common stock in connection with our initial public offering and vest as follows: (1) 40 percent vested immediately; (2) 40 percent of each award will vest on December 11, 2014, contingent upon employment through that date; and (3) 20 percent of each award will vest on the date that The Blackstone Group L.P. and its affiliates ("Blackstone" or "our Sponsor") cease to own 50 percent or more of the shares of the Company, contingent on employment through that date.

In March 2014, the vesting conditions of these restricted shares of common stock for certain participants were modified such that the remaining 60 percent of each participant's award vested in June 2014. As a result of this modification, we recorded incremental compensation expense of $7 million during the six months ended June 30, 2014. During the three and six months ended June 30, 2014, total compensation expense under the Promote plan was $6 million and $19 million, respectively, and unrecognized compensation expense as of June 30, 2014 was $78 million, including $10 million that is expected to be recognized through December 2014 and $68 million that is subject to the achievement of a performance condition. No expense was recognized for the portion of the awards that are subject to the achievement of a performance condition in the form of a liquidity event, since such an event was not probable as of June 30, 2014.

We recorded compensation expense related to the Promote plan of $1 million and $3 million during the three and six months ended June 30, 2013, respectively.

Cash-based Long-term Incentive Plan

In February 2014, we terminated a cash-based, long-term incentive plan and reversed the associated accruals resulting in a reduction of compensation expense of approximately $25 million for the six months ended June 30, 2014.
Earnings Per Share
Earnings Per Share
Earnings Per Share

The following table presents the calculation of basic and diluted earnings per share ("EPS"):
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in millions, except per share amounts)
Basic EPS:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Net income attributable to Hilton stockholders
$
209

 
$
155

 
$
332

 
$
189

Denominator:
 
 
 
 
 
 
 
Weighted average shares outstanding
985

 
921

 
985

 
921

Basic EPS
$
0.21

 
$
0.17

 
$
0.34

 
$
0.20

 
 
 
 
 
 
 
 
Diluted EPS:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Net income attributable to Hilton stockholders
$
209

 
$
155

 
$
332

 
$
189

Denominator:
 
 
 
 
 
 
 
Weighted average shares outstanding
985

 
921

 
985

 
921

Diluted EPS
$
0.21

 
$
0.17

 
$
0.34

 
$
0.20



Approximately 1 million options were excluded from the computation of diluted EPS for the three and six months ended June 30, 2014 because their effect would have been anti-dilutive under the treasury stock method.
Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Loss

The components of accumulated other comprehensive loss, net of taxes, were as follows:
 
Currency Translation Adjustment(1)
 
Pension Liability Adjustment
 
Cash Flow Hedge Adjustment
 
Total
 
(in millions)
Balance as of December 31, 2013
$
(136
)
 
$
(134
)
 
$
6

 
$
(264
)
 
 
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
87

 
2

 
(9
)
 
80

Amounts reclassified from accumulated other comprehensive loss
(4
)
 
2

 

 
(2
)
Net current period other comprehensive income (loss)
83

 
4

 
(9
)
 
78

 
 
 
 
 
 
 
 
Balance as of June 30, 2014
$
(53
)
 
$
(130
)
 
$
(3
)
 
$
(186
)

 
Currency Translation Adjustment(1)
 
Pension Liability Adjustment
 
Total
 
(in millions)
Balance as of December 31, 2012
$
(212
)
 
$
(194
)
 
$
(406
)
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
(197
)
 
8

 
(189
)
Amounts reclassified from accumulated other comprehensive loss

 
4

 
4

Net current period other comprehensive income (loss)
(197
)
 
12

 
(185
)
 
 
 
 
 
 
Balance as of June 30, 2013
$
(409
)
 
$
(182
)
 
$
(591
)

____________
(1) 
Includes net investment hedges.

The following table presents additional information about reclassifications out of accumulated other comprehensive loss:
 
Six Months Ended June 30,
 
2014
 
2013
 
(in millions)
Currency translation adjustment:
 
 
 
Sale and liquidation of foreign assets(1)
$
4

 
$
(1
)
Gains on net investment hedges(2)

 
1

Tax benefit(3)(4)

 

Total currency translation adjustment reclassifications for the period, net of taxes
4

 

 
 
 
 
Pension liability adjustment:
 
 
 
Amortization of prior service cost(5)
(2
)
 
(1
)
Amortization of net loss(5)
(1
)
 
(5
)
Tax benefit(3)
1

 
2

Total pension liability adjustment reclassifications for the period, net of taxes
(2
)
 
(4
)
 
 
 
 
Total reclassifications for the period, net of tax
$
2

 
$
(4
)
____________
(1) 
Reclassified out of accumulated other comprehensive loss to other gain (loss), net in our condensed consolidated statements of operations. Amounts in parentheses indicate a loss in our condensed consolidated statements of operations.
(2) 
Reclassified out of accumulated other comprehensive loss to gain (loss) on foreign currency transactions in our condensed consolidated statements of operations.
(3) 
Reclassified out of accumulated other comprehensive loss to income tax expense in our condensed consolidated statements of operations.
(4) 
The respective tax benefit was less than $1 million for the six months ended June 30, 2013.
(5) 
Reclassified out of accumulated other comprehensive loss to general, administrative and other in the condensed consolidated statements of operations. These amounts were included in the computation of net periodic pension cost. See Note 11: "Employee Benefit Plans" for additional information. Amounts in parentheses indicate a loss in our condensed consolidated statements of operations.
Business Segments
Business Segments
Business Segments

We are a diversified hospitality company with operations organized in three distinct operating segments: ownership, management and franchise and timeshare. Each segment is managed separately because of its distinct economic characteristics.

The ownership segment includes all hotels that we wholly own or lease, as well as consolidated non-wholly owned entities and consolidated VIEs. As of June 30, 2014, this segment included 118 wholly owned and leased hotels and resorts, three non-wholly owned hotel properties and three hotels of consolidated VIEs. While we do not include equity in earnings (losses) from unconsolidated affiliates in our measures of segment revenues, we manage these investments in our ownership segment. Our unconsolidated affiliates are primarily investments in entities that owned or leased 27 hotels and one condominium management company as of June 30, 2014.

The management and franchise segment includes all of the hotels we manage for third-party owners, as well as all franchised hotels operated or managed by someone other than us under one of our proprietary brand names of our brand portfolio. As of June 30, 2014, this segment included 517 managed hotels and 3,489 franchised hotels. This segment also earns fees for managing properties in our ownership and timeshare segments.

The timeshare segment includes the development of vacation ownership clubs and resorts, marketing and selling of timeshare intervals, providing timeshare customer financing and resort operations. This segment also provides assistance to third-party developers in selling their timeshare inventory. As of June 30, 2014, this segment included 44 timeshare properties.

Corporate and other represents revenues and related operating expenses generated by the incidental support of hotel operations for owned, leased, managed and franchised hotels and other rental income, as well as corporate assets and related expenditures.

The performance of our operating segments is evaluated primarily based on Adjusted EBITDA, which should not be considered an alternative to net income (loss) or other measures of financial performance or liquidity derived in accordance with U.S. GAAP. EBITDA, presented herein, is a non-GAAP financial measure that reflects net income attributable to Hilton stockholders, excluding interest expense, a provision for income taxes and depreciation and amortization. We define Adjusted EBITDA as EBITDA, further adjusted to exclude certain items, including, but not limited to, gains, losses and expenses in connection with: (i) asset dispositions for both consolidated and unconsolidated investments; (ii) foreign currency transactions; (iii) debt restructurings/retirements; (iv) non-cash impairment losses; (v) furniture, fixtures and equipment ("FF&E") replacement reserves required under certain lease agreements; (vi) reorganization costs; (vii) share-based and certain other compensation expenses prior to and in connection with our initial public offering; (viii) severance, relocation and other expenses; and (ix) other items.

The following table presents revenues and Adjusted EBITDA for our reportable segments, reconciled to consolidated amounts:
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in millions)
Revenues
 
 
 
 
 
 
 
Ownership(1)(2)
$
1,126


$
1,078

 
$
2,078

 
$
1,998

Management and franchise(3)
371


326

 
702

 
608

Timeshare
276


261

 
555

 
507

Segment revenues
1,773


1,665

 
3,335

 
3,113

Other revenues from managed and franchised properties
920


750

 
1,747

 
1,591

Other revenues(4)
25


15

 
46

 
30

Intersegment fees elimination(1)(2)(3)(4)
(51
)

(50
)
 
(98
)
 
(91
)
Total revenues
$
2,667


$
2,380

 
$
5,030

 
$
4,643

 
 
 
 
 
 
 
 
Adjusted EBITDA
 
 
 
 
 
 
 
Ownership(1)(2)(3)(4)(5)
$
291


$
271

 
$
470

 
$
445

Management and franchise(3)
371


326

 
702

 
608

Timeshare(1)(3)
69


60

 
154

 
119

Corporate and other(2)(4)
(80
)

(67
)
 
(131
)
 
(135
)
Adjusted EBITDA
$
651


$
590

 
$
1,195

 
$
1,037

____________
(1)
Includes charges to timeshare operations for rental fees and fees for other amenities, which were eliminated in our condensed consolidated financial statements. These charges totaled $8 million and $7 million for the three months ended June 30, 2014 and 2013, respectively, and $14 million and $12 million for the six months ended June 30, 2014 and 2013, respectively. While the net effect is zero, our measures of segment revenues and Adjusted EBITDA include these fees as a benefit to the ownership segment and a cost to timeshare Adjusted EBITDA.
(2)
Includes other intercompany charges of $1 million for the three months ended June 30, 2014 and 2013 and $2 million for the six months ended June 30, 2014 and 2013.
(3)
Includes management, royalty and intellectual property fees of $29 million and $26 million for the three months ended June 30, 2014 and 2013, respectively, and $56 million and $47 million for the six months ended June 30, 2014 and 2013, respectively. These fees are charged to consolidated owned and leased properties and were eliminated in our condensed consolidated financial statements. Also includes a licensing fee of $11 million and $13 million for the three months ended June 30, 2014 and 2013, respectively, and $22 million and $25 million for the six months ended June 30, 2014 and 2013, respectively, which is charged to our timeshare segment by our management and franchise segment and was eliminated in our condensed consolidated financial statements. While the net effect is zero, our measures of segment revenues and Adjusted EBITDA include these fees as a benefit to the management and franchise segment and a cost to ownership Adjusted EBITDA and timeshare Adjusted EBITDA.
(4) 
Includes charges to consolidated owned and leased properties for services provided by our wholly owned laundry business of $2 million and $3 million for the three months ended June 30, 2014 and 2013, respectively, and $4 million and $5 million for the six months ended June 30, 2014 and 2013, respectively. These charges were eliminated in our condensed consolidated financial statements.
(5) 
Includes unconsolidated affiliate Adjusted EBITDA.

The following table provides a reconciliation of Adjusted EBITDA to EBITDA and EBITDA to net income attributable to Hilton stockholders:
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in millions)
Adjusted EBITDA
$
651

 
$
590

 
$
1,195

 
$
1,037

Net income attributable to noncontrolling interests
(3
)
 
(2
)
 
(4
)
 
(6
)
Gain (loss) on foreign currency transactions
32

 
(39
)
 
46

 
(82
)
FF&E replacement reserve
(12
)
 
(10
)
 
(23
)
 
(17
)
Share-based compensation expense
(6
)
 
(1
)
 
(19
)
 
(3
)
Other gain (loss), net
11

 
(1
)
 
14

 
6

Other adjustment items
(17
)
 
(9
)
 
(30
)
 
(20
)
EBITDA
656

 
528

 
1,179

 
915

Interest expense
(158
)
 
(131
)
 
(311
)
 
(274
)
Interest expense included in equity in earnings from unconsolidated affiliates
(3
)
 
(2
)
 
(6
)
 
(6
)
Income tax expense
(121
)
 
(84
)
 
(204
)
 
(122
)
Depreciation and amortization
(158
)
 
(149
)
 
(311
)
 
(309
)
Depreciation and amortization included in equity in earnings from unconsolidated affiliates
(7
)
 
(7
)
 
(15
)
 
(15
)
Net income attributable to Hilton stockholders
$
209

 
$
155

 
$
332

 
$
189



The following table presents assets for our reportable segments, reconciled to consolidated amounts:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Assets:
 
 
 
Ownership
$
11,851

 
$
11,936

Management and franchise
10,726

 
11,016

Timeshare
1,836

 
1,871

Corporate and other
2,084

 
1,739

 
$
26,497

 
$
26,562



The following table presents capital expenditures for property and equipment for our reportable segments, reconciled to consolidated amounts:
 
Six Months Ended
 
June 30,
 
2014

2013
 
(in millions)
Capital expenditures for property and equipment:
 
 
 
Ownership
$
106

 
$
116

Timeshare
1

 
2

Corporate and other
3

 
3

 
$
110

 
$
121

Commitments and Contingencies
Commitments and Contingencies Disclosure
Commitments and Contingencies

As of June 30, 2014, we had outstanding guarantees of $27 million, with remaining terms ranging from four months to nine years, for debt and other obligations of third parties. We have two letters of credit for a total of $27 million that have been pledged as collateral for two of these guarantees. Although we believe it is unlikely that material payments will be required under these guarantees or letters of credit, there can be no assurance that this will be the case.

We have also provided performance guarantees to certain owners of hotels that we operate under management contracts. Most of these guarantees allow us to terminate the contract, rather than fund shortfalls, if specified performance levels are not achieved. However, in limited cases, we are obligated to fund performance shortfalls. As of June 30, 2014, we had six contracts containing performance guarantees, with expirations ranging from 2018 to 2030, and possible cash outlays totaling approximately $150 million. Our obligations under these guarantees in future periods are dependent on the operating performance levels of these hotels over the remaining terms of the performance guarantees. We do not have any letters of credit pledged as collateral against these guarantees. As of June 30, 2014 and December 31, 2013, we recorded current liabilities of approximately $9 million and non-current liabilities of approximately $46 million and $51 million, respectively, in our condensed consolidated balance sheets for obligations under our outstanding performance guarantees that are related to certain VIEs for which we are not the primary beneficiary.

As of June 30, 2014, we had outstanding commitments under third-party contracts of approximately $144 million for capital expenditures at certain owned and leased properties, including our consolidated VIEs. Our contracts contain clauses that allow us to cancel all or some portion of the work. If cancellation of a contract occurred, our commitment would be any costs incurred up to the cancellation date, in addition to any costs associated with the discharge of the contract.

We have entered into an agreement with a developer in Las Vegas, Nevada, whereby we have agreed to purchase residential units from the developer that we will convert to timeshare units to be marketed and sold under our Hilton Grand Vacations brand. Subject to certain conditions, we are required to purchase approximately $92 million of inventory ratably over a maximum period of four years, which is equivalent to purchases of approximately $6 million per quarter. We began purchasing inventory during the quarter ended March 31, 2013, and as of June 30, 2014, we had purchased $46 million of inventory under this agreement. As of June 30, 2014, our contractual obligations pursuant to this agreement for the remainder of 2014 and the years ended December 31, 2015 and 2016 were $12 million, $24 million and $10 million, respectively.

During 2010, an affiliate of our Sponsor settled a $75 million liability on our behalf in conjunction with a lawsuit settlement by entering into service contracts with the plaintiff. We recorded the portion settled by this affiliate as a capital contribution. Additionally, as part of the settlement, we entered into a guarantee with the plaintiff to pay any shortfall that this affiliate does not fund related to those service contracts up to the value of the settlement amount made by the affiliate. The remaining potential exposure under this guarantee as of June 30, 2014 was approximately $37 million. We have not accrued a liability for this guarantee as we believe the likelihood of any material funding to be remote.

We are involved in other litigation arising from the normal course of business, some of which includes claims for substantial sums. Accruals are recorded when the outcome is probable and can be reasonably estimated in accordance with applicable accounting requirements regarding accounting for contingencies. While the ultimate results of claims and litigation cannot be predicted with certainty, we expect that the ultimate resolution of all pending or threatened claims and litigation as of June 30, 2014 will not have a material effect on our condensed consolidated results of operations, financial position or cash flows.
Subsequent Events
Subsequent Events [Text Block]
Subsequent Events

Equity Method Investments Exchange

We have a portfolio of 11 hotels that we own through noncontrolling interests in equity method investments with one other partner.  In July 2014, we entered into an agreement to exchange our ownership interest in six of these hotels for the remaining interest in the other five hotels.  After the exchange, we will have a 100 percent ownership interest in five of the 11 hotels and will no longer hold a noncontrolling interest in the remaining six hotels.  The transaction will be accounted for as a business combination achieved in stages, which will require us to remeasure our investments in these unconsolidated equity method investments at fair value and recognize a gain or loss if the fair value is in excess of or below our carrying value, respectively. Additionally, we will recognize the identifiable assets acquired, primarily property and equipment, and mortgage debt assumed at fair value upon consolidation of the five hotels in which we will hold a 100 percent ownership interest. We are unable to estimate the fair value at this time. 

Debt Repayment

In July 2014, we made a voluntary prepayment of $150 million on our Term Loans.
Recently Issued Accounting Pronouncements (Policies)
In July 2013, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2013-11 ("ASU 2013-11"), Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This ASU provides guidance on the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss or a tax credit carryforward exists in the applicable jurisdiction to settle any additional income taxes that would result from disallowance of the tax position. The provisions of ASU 2013-11 were effective, prospectively, for reporting periods beginning after December 15, 2013. As a result of our adoption of this ASU on January 1, 2014, $108 million of unrecognized tax benefits were reclassified against deferred income tax assets.
In March 2013, the FASB issued ASU No. 2013-05 ("ASU 2013-05"), Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity. This ASU clarifies when a cumulative translation adjustment should be released to net income when a parent either sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a nonprofit activity or a business (other than a sale of in substance real estate) within a foreign entity. The provisions of ASU 2013-05 were effective, prospectively, for reporting periods beginning after December 15, 2013. The adoption did not have a material effect on our condensed consolidated financial statements.
In May 2014, the FASB issued ASU No. 2014-09 ("ASU 2014-09"), Revenue from Contracts with Customers (Topic 606). This ASU supersedes the revenue recognition requirements in "Revenue Recognition (Topic 605)," and requires entities to recognize revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to in exchange for those goods or services. The provisions of ASU 2014-09 are effective for annual periods beginning after December 15, 2016, including interim periods within that reporting period and are to be applied retrospectively; early application is not permitted.
In April 2014, the FASB issued ASU No. 2014-08 ("ASU 2014-08"), Presentation of Financial Statements (Topic 205) and Property, Plant and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. This ASU amends guidance on reporting discontinued operations only if the disposal of a component of an entity or group of components of an entity represents a strategic shift that has (or will have) a major effect on an entity’s operations and financial results. The provisions of ASU 2014-08 should be applied prospectively for all disposals of components of an entity and for all businesses that, on acquisition, are classified as held for sale that occurred within annual periods beginning on or after December 15, 2014, and interim periods within.
Property and Equipment (Tables)
Schedule of Property and Equipment
Property and equipment were as follows:    
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Land
$
4,097

 
$
4,098

Buildings and leasehold improvements
5,609

 
5,511

Furniture and equipment
1,193

 
1,172

Construction-in-progress
81

 
67

 
10,980

 
10,848

Accumulated depreciation and amortization
(1,944
)
 
(1,790
)
 
$
9,036

 
$
9,058

Financing Receivables (Tables)
Financing receivables were as follows:
 
June 30, 2014
 
Securitized Timeshare
 
Unsecuritized Timeshare
 
Other
 
Total
 
(in millions)
Financing receivables
$
491

 
$
370

 
$
40

 
$
901

Less: allowance
(29
)
 
(50
)
 
(1
)
 
(80
)
 
462

 
320

 
39

 
821

 
 
 
 
 
 
 
 
Current portion of financing receivables
69

 
58

 
2

 
129

Less: allowance
(4
)
 
(8
)
 

 
(12
)
 
65

 
50

 
2

 
117

 
 
 
 
 
 
 
 
Total financing receivables
$
527

 
$
370

 
$
41

 
$
938


 
December 31, 2013
 
Securitized Timeshare
 
Unsecuritized Timeshare
 
Other
 
Total
 
(in millions)
Financing receivables
$
205

 
$
654

 
$
49

 
$
908

Less: allowance
(11
)
 
(67
)
 
(1
)
 
(79
)
 
194

 
587

 
48

 
829

 
 
 
 
 
 
 
 
Current portion of financing receivables
29

 
106

 

 
135

Less: allowance
(2
)
 
(12
)
 

 
(14
)
 
27

 
94

 

 
121

 
 
 
 
 
 
 
 
Total financing receivables
$
221

 
$
681

 
$
48

 
$
950

The changes in our allowance for uncollectible timeshare financing receivables were as follows:
 
Six Months Ended June 30,
 
2014
 
2013
 
(in millions)
Beginning balance
$
92

 
$
93

Write-offs
(16
)
 
(11
)
Provision for uncollectibles on sales
15

 
13

Ending balance
$
91

 
$
95

Our timeshare financing receivables as of June 30, 2014 mature as follows:
 
Securitized Timeshare
 
Unsecuritized Timeshare
Year
(in millions)
2014 (remaining)
$
34

 
$
35

2015
70

 
45

2016
73

 
48

2017
75

 
49

2018
75

 
48

Thereafter
233

 
203

 
560

 
428

Less: allowance
(33
)
 
(58
)
 
$
527

 
$
370

The following table details an aged analysis of our gross timeshare financing receivables balance:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Current
$
947

 
$
948

30 - 89 days past due
10

 
14

90 - 119 days past due
3

 
4

120 days and greater past due
28

 
28

 
$
988

 
$
994

Investments in Affiliates (Tables)
Schedule of Investments in Affiliates
Investments in affiliates were as follows:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Equity investments
$
240

 
$
245

Other investments
17

 
15

 
$
257

 
$
260

Debt (Tables)
Long-term debt balances, including obligations for capital leases, and associated interest rates were as follows:

June 30,
 
December 31,

2014
 
2013

(in millions)
Senior secured term loan facility with a rate of 3.50%, due 2020
$
5,550

 
$
6,000

Senior notes with a rate of 5.625%, due 2021
1,500

 
1,500

Commercial mortgage-backed securities loan with an average rate of 4.05%, due 2018(1)
3,500

 
3,500

Mortgage loan with a rate of 2.30%, due 2018
525

 
525

Mortgage notes with an average rate of 6.15%, due 2016
132

 
133

Other unsecured notes with a rate of 7.50%, due 2017
54

 
53

Capital lease obligations with an average rate of 6.04%, due 2015 to 2097
82

 
73


11,343


11,784

Less: current maturities of long-term debt
(3
)

(4
)
Less: unamortized discount on senior secured term loan facility
(26
)
 
(29
)

$
11,314


$
11,751

____________
(1) 
The initial maturity date of the variable-rate component of this borrowing is November 1, 2015. We assumed all extensions, which are solely at our option, were exercised.
Non-recourse debt, including obligations for capital leases, and associated interest rates were as follows:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Capital lease obligations of consolidated VIEs with a rate of 6.34%, due 2018 to 2026
$
259

 
$
255

Non-recourse debt of consolidated VIEs with an average rate of 3.38%, due 2015 to 2018(1)
40

 
41

Timeshare Facility with a rate of 1.48%, due 2016
150

 
450

Securitized Timeshare Debt with an average rate of 1.98%, due 2026
548

 
222

 
997

 
968

Less: current maturities of non-recourse debt
(107
)
 
(48
)
 
$
890

 
$
920

____________
(1) 
Excludes the non-recourse debt of our VIEs that issued the Securitized Timeshare Debt, as this is presented separately.
The contractual maturities of our long-term debt and non-recourse debt as of June 30, 2014 were as follows:
Year
(in millions)
2014 (remaining)
$
61

2015
109

2016
363

2017
139

2018(1)
4,110

Thereafter
7,558

 
$
12,340

____________
(1) 
The CMBS Loan has three one-year extensions, solely at our option, that effectively extend maturity to November 1, 2018. We assumed all extensions for purposes of calculating maturity dates.
Derivative Instruments and Hedging Activities (Tables)
The effects of our derivative instruments on our condensed consolidated balance sheets were as follows:
 
June 30, 2014
 
December 31, 2013
 
Balance Sheet Classification
 
Fair Value
 
Balance Sheet Classification
 
Fair Value
 
 
 
(in millions)
 
 
 
(in millions)
Cash Flow Hedges:
 
 
 
 
 
 
 
Interest rate swaps
Other liabilities
 
$
5

 
Other assets
 
$
10

 
 
 
 
 
 
 
 
Non-designated Hedges:
 
 
 
 
 
 
 
Interest rate caps
Other assets
 

 
Other assets
 


The effects of our derivative instruments on our condensed consolidated statements of operations and condensed consolidated statements of comprehensive income (loss) before any effect for income taxes were as follows:
 
 
 
Three Months Ended
 
Six Months Ended
 
 
 
June 30,
 
June 30,
 
Classification of Loss Recognized
 
2014
 
2013
 
2014

2013
 
 
 
(in millions)
Cash Flow Hedges:
 
 
 
 
 
 
 
 
 
Interest rate swaps(1)
Other comprehensive loss
 
$
(9
)
 
$

 
$
(14
)
 
$

 
 
 
 
 
 
 
 
 
 
Non-designated Hedges:
 
 
 
 
 
 
 
 
 
Interest rate caps
Other gain (loss), net
 

 

 

 

____________
(1) 
There were no amounts recognized in earnings related to hedge ineffectiveness or amounts excluded from hedge effectiveness testing during the three and six months ended June 30, 2014.
Fair Value Measurements (Tables)
Fair Value of Financial Assets and Liabilities
The carrying amounts and estimated fair values of our financial assets and liabilities, including related current portions, were as follows:

 
June 30, 2014
 
 
 
Hierarchy Level
 
Carrying Amount
 
Level 1
 
Level 2
 
Level 3
 
(in millions)
Assets:
 
 
 
 
 
 
 
Cash equivalents
$
291

 
$

 
$
291

 
$

Restricted cash equivalents
94

 

 
94

 

Timeshare financing receivables
988

 

 

 
990

Liabilities:
 
 
 
 
 
 
 
Long-term debt(1)
11,235

 
59

 
1,598

 
9,862

Non-recourse debt(2)
698

 

 

 
701

Interest rate swaps
5

 

 
5

 


 
December 31, 2013
 
 
 
Hierarchy Level
 
Carrying Amount
 
Level 1
 
Level 2
 
Level 3
 
(in millions)
Assets:
 
 
 
 
 
 
 
Cash equivalents
$
309

 
$

 
$
309

 
$

Restricted cash equivalents
107

 

 
107

 

Timeshare financing receivables
994

 

 

 
996

Interest rate swaps
10

 

 
10

 

Liabilities:
 
 
 
 
 
 
 
Long-term debt(1)
11,682

 
57

 
1,560

 
10,358

Non-recourse debt(2)
672

 

 

 
670

____________
(1)
Excludes capital lease obligations with a carrying value of $82 million and $73 million as of June 30, 2014 and December 31, 2013, respectively.
(2)
Represents the Securitized Timeshare Debt and the Timeshare Facility.

Employee Benefit Plans (Tables)
Schedule of Net Periodic Pension Cost (Credit)
 
Six Months Ended June 30,
 
2014
 
2013
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
(in millions)
Service cost
$
4

 
$

 
$
2

 
$
2

 
$
2

 
$
1

Interest cost
8

 
9

 
2

 
9

 
8

 
2

Expected return on plan assets
(9
)
 
(12
)
 
(2
)
 
(10
)
 
(11
)
 
(2
)
Amortization of prior service cost (credit)
2

 

 

 
2

 
(1
)
 

Amortization of net loss
1

 

 

 
2

 
2

 
1

Settlement losses
1

 

 

 

 

 
1

Net periodic pension cost (credit)
$
7

 
$
(3
)
 
$
2

 
$
5

 
$

 
$
3

The components of net periodic pension cost (credit) for the Domestic Plan, U.K. Plan and International Plans were as follows:
 
Three Months Ended June 30,
 
2014
 
2013
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
Domestic Plan
 
U.K. Plan
 
International Plans
 
(in millions)
Service cost
$
2

 
$

 
$
1

 
$
1

 
$
1

 
$

Interest cost
4

 
4

 
1

 
5

 
4

 
1

Expected return on plan assets
(5
)
 
(6
)
 
(1
)
 
(6
)
 
(6
)
 
(1
)
Amortization of prior service cost
1

 

 

 
1

 

 

Amortization of net loss
1

 

 

 
1

 
1

 
1

Settlement losses
1

 

 

 

 

 

Net periodic pension cost (credit)
$
4

 
$
(2
)
 
$
1

 
$
2

 
$

 
$
1

Earnings Per Share (Tables)
Basic and Diluted Earnings Per Share
The following table presents the calculation of basic and diluted earnings per share ("EPS"):
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in millions, except per share amounts)
Basic EPS:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Net income attributable to Hilton stockholders
$
209

 
$
155

 
$
332

 
$
189

Denominator:
 
 
 
 
 
 
 
Weighted average shares outstanding
985

 
921

 
985

 
921

Basic EPS
$
0.21

 
$
0.17

 
$
0.34

 
$
0.20

 
 
 
 
 
 
 
 
Diluted EPS:
 
 
 
 
 
 
 
Numerator:
 
 
 
 
 
 
 
Net income attributable to Hilton stockholders
$
209

 
$
155

 
$
332

 
$
189

Denominator:
 
 
 
 
 
 
 
Weighted average shares outstanding
985

 
921

 
985

 
921

Diluted EPS
$
0.21

 
$
0.17

 
$
0.34

 
$
0.20

Accumulated Other Comprehensive Loss (Tables)
The components of accumulated other comprehensive loss, net of taxes, were as follows:
 
Currency Translation Adjustment(1)
 
Pension Liability Adjustment
 
Cash Flow Hedge Adjustment
 
Total
 
(in millions)
Balance as of December 31, 2013
$
(136
)
 
$
(134
)
 
$
6

 
$
(264
)
 
 
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
87

 
2

 
(9
)
 
80

Amounts reclassified from accumulated other comprehensive loss
(4
)
 
2

 

 
(2
)
Net current period other comprehensive income (loss)
83

 
4

 
(9
)
 
78

 
 
 
 
 
 
 
 
Balance as of June 30, 2014
$
(53
)
 
$
(130
)
 
$
(3
)
 
$
(186
)

 
Currency Translation Adjustment(1)
 
Pension Liability Adjustment
 
Total
 
(in millions)
Balance as of December 31, 2012
$
(212
)
 
$
(194
)
 
$
(406
)
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
(197
)
 
8

 
(189
)
Amounts reclassified from accumulated other comprehensive loss

 
4

 
4

Net current period other comprehensive income (loss)
(197
)
 
12

 
(185
)
 
 
 
 
 
 
Balance as of June 30, 2013
$
(409
)
 
$
(182
)
 
$
(591
)

____________
(1) 
Includes net investment hedges.

The following table presents additional information about reclassifications out of accumulated other comprehensive loss:
 
Six Months Ended June 30,
 
2014
 
2013
 
(in millions)
Currency translation adjustment:
 
 
 
Sale and liquidation of foreign assets(1)
$
4

 
$
(1
)
Gains on net investment hedges(2)

 
1

Tax benefit(3)(4)

 

Total currency translation adjustment reclassifications for the period, net of taxes
4

 

 
 
 
 
Pension liability adjustment:
 
 
 
Amortization of prior service cost(5)
(2
)
 
(1
)
Amortization of net loss(5)
(1
)
 
(5
)
Tax benefit(3)
1

 
2

Total pension liability adjustment reclassifications for the period, net of taxes
(2
)
 
(4
)
 
 
 
 
Total reclassifications for the period, net of tax
$
2

 
$
(4
)
____________
(1) 
Reclassified out of accumulated other comprehensive loss to other gain (loss), net in our condensed consolidated statements of operations. Amounts in parentheses indicate a loss in our condensed consolidated statements of operations.
(2) 
Reclassified out of accumulated other comprehensive loss to gain (loss) on foreign currency transactions in our condensed consolidated statements of operations.
(3) 
Reclassified out of accumulated other comprehensive loss to income tax expense in our condensed consolidated statements of operations.
(4) 
The respective tax benefit was less than $1 million for the six months ended June 30, 2013.
(5) 
Reclassified out of accumulated other comprehensive loss to general, administrative and other in the condensed consolidated statements of operations. These amounts were included in the computation of net periodic pension cost. See Note 11: "Employee Benefit Plans" for additional information. Amounts in parentheses indicate a loss in our condensed consolidated statements of operations.
Business Segments (Tables)
The following table presents revenues and Adjusted EBITDA for our reportable segments, reconciled to consolidated amounts:
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in millions)
Revenues
 
 
 
 
 
 
 
Ownership(1)(2)
$
1,126


$
1,078

 
$
2,078

 
$
1,998

Management and franchise(3)
371


326

 
702

 
608

Timeshare
276


261

 
555

 
507

Segment revenues
1,773


1,665

 
3,335

 
3,113

Other revenues from managed and franchised properties
920


750

 
1,747

 
1,591

Other revenues(4)
25


15

 
46

 
30

Intersegment fees elimination(1)(2)(3)(4)
(51
)

(50
)
 
(98
)
 
(91
)
Total revenues
$
2,667


$
2,380

 
$
5,030

 
$
4,643

 
 
 
 
 
 
 
 
Adjusted EBITDA
 
 
 
 
 
 
 
Ownership(1)(2)(3)(4)(5)
$
291


$
271

 
$
470

 
$
445

Management and franchise(3)
371


326

 
702

 
608

Timeshare(1)(3)
69


60

 
154

 
119

Corporate and other(2)(4)
(80
)

(67
)
 
(131
)
 
(135
)
Adjusted EBITDA
$
651


$
590

 
$
1,195

 
$
1,037

____________
(1)
Includes charges to timeshare operations for rental fees and fees for other amenities, which were eliminated in our condensed consolidated financial statements. These charges totaled $8 million and $7 million for the three months ended June 30, 2014 and 2013, respectively, and $14 million and $12 million for the six months ended June 30, 2014 and 2013, respectively. While the net effect is zero, our measures of segment revenues and Adjusted EBITDA include these fees as a benefit to the ownership segment and a cost to timeshare Adjusted EBITDA.
(2)
Includes other intercompany charges of $1 million for the three months ended June 30, 2014 and 2013 and $2 million for the six months ended June 30, 2014 and 2013.
(3)
Includes management, royalty and intellectual property fees of $29 million and $26 million for the three months ended June 30, 2014 and 2013, respectively, and $56 million and $47 million for the six months ended June 30, 2014 and 2013, respectively. These fees are charged to consolidated owned and leased properties and were eliminated in our condensed consolidated financial statements. Also includes a licensing fee of $11 million and $13 million for the three months ended June 30, 2014 and 2013, respectively, and $22 million and $25 million for the six months ended June 30, 2014 and 2013, respectively, which is charged to our timeshare segment by our management and franchise segment and was eliminated in our condensed consolidated financial statements. While the net effect is zero, our measures of segment revenues and Adjusted EBITDA include these fees as a benefit to the management and franchise segment and a cost to ownership Adjusted EBITDA and timeshare Adjusted EBITDA.
(4) 
Includes charges to consolidated owned and leased properties for services provided by our wholly owned laundry business of $2 million and $3 million for the three months ended June 30, 2014 and 2013, respectively, and $4 million and $5 million for the six months ended June 30, 2014 and 2013, respectively. These charges were eliminated in our condensed consolidated financial statements.
(5) 
Includes unconsolidated affiliate Adjusted EBITDA.

The following table provides a reconciliation of Adjusted EBITDA to EBITDA and EBITDA to net income attributable to Hilton stockholders:
 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2014
 
2013
 
2014
 
2013
 
(in millions)
Adjusted EBITDA
$
651

 
$
590

 
$
1,195

 
$
1,037

Net income attributable to noncontrolling interests
(3
)
 
(2
)
 
(4
)
 
(6
)
Gain (loss) on foreign currency transactions
32

 
(39
)
 
46

 
(82
)
FF&E replacement reserve
(12
)
 
(10
)
 
(23
)
 
(17
)
Share-based compensation expense
(6
)
 
(1
)
 
(19
)
 
(3
)
Other gain (loss), net
11

 
(1
)
 
14

 
6

Other adjustment items
(17
)
 
(9
)
 
(30
)
 
(20
)
EBITDA
656

 
528

 
1,179

 
915

Interest expense
(158
)
 
(131
)
 
(311
)
 
(274
)
Interest expense included in equity in earnings from unconsolidated affiliates
(3
)
 
(2
)
 
(6
)
 
(6
)
Income tax expense
(121
)
 
(84
)
 
(204
)
 
(122
)
Depreciation and amortization
(158
)
 
(149
)
 
(311
)
 
(309
)
Depreciation and amortization included in equity in earnings from unconsolidated affiliates
(7
)
 
(7
)
 
(15
)
 
(15
)
Net income attributable to Hilton stockholders
$
209

 
$
155

 
$
332

 
$
189

The following table presents assets for our reportable segments, reconciled to consolidated amounts:
 
June 30,
 
December 31,
 
2014
 
2013
 
(in millions)
Assets:
 
 
 
Ownership
$
11,851

 
$
11,936

Management and franchise
10,726

 
11,016

Timeshare
1,836

 
1,871

Corporate and other
2,084

 
1,739

 
$
26,497

 
$
26,562

The following table presents capital expenditures for property and equipment for our reportable segments, reconciled to consolidated amounts:
 
Six Months Ended
 
June 30,
 
2014

2013
 
(in millions)
Capital expenditures for property and equipment:
 
 
 
Ownership
$
106

 
$
116

Timeshare
1

 
2

Corporate and other
3

 
3

 
$
110

 
$
121

Organization and Basis of Presentation (Details)
12 Months Ended
Dec. 31, 2013
Jun. 30, 2014
Organization, Consolidation and Presentation of Financial Statements [Abstract]
 
 
Number of brands
 
11 
Number of hotel properties
 
4,158 
Number of hotel rooms
 
687,222 
Number of countries
 
93 
Number of timeshare properties
 
44 
Number of timeshare units
 
6,758 
Stock split
9,205,128-for-1 
 
Recently Issued Accounting Pronouncements Impact of Recently Issued Accounting Pronouncements (Details) (USD $)
In Millions, unless otherwise specified
Jan. 2, 2014
Accounting Policies [Abstract]
 
Reclassified unrecognized tax benefits
$ 108 
Property and Equipment - Schedule of Property and Equipment (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Property, Plant and Equipment [Abstract]
 
 
Land
$ 4,097 
$ 4,098 
Buildings And Leasehold Improvements
5,609 
5,511 
Furniture And Equipment
1,193 
1,172 
Construction in Progress, Gross
81 
67 
Property and equipment, gross
10,980 
10,848 
Accumulated depreciation and amortization
(1,944)
(1,790)
Property and equipment, net
$ 9,036 
$ 9,058 
Property and Equipment - Additional Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Dec. 31, 2013
Property, Plant and Equipment [Line Items]
 
 
 
 
 
Gain (Loss) on Disposition of Assets
 
 
$ 12 
 
 
Sale and liquidation of foreign assets
 
 
 
 
Payments to Acquire Land Held-for-use
 
 
 
28 
 
Depreciation
79 
77 
156 
166 
 
Net capital lease assets included in property and equipment
150 
 
150 
 
130 
Accumulated depreciation and amortization of capital lease assets included in property and equipment
65 
 
65 
 
59 
Grand Islander proceeds
 
 
37 
 
 
Capital contribution
 
 
13 
 
 
Proceeds from Divestiture of Businesses, Net of Cash Divested
 
 
 
 
Proceeds from Sale of Land Held-for-use
 
 
$ 6 
 
 
Financing Receivables - Schedule of Financing Receivables (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Financing receivables, gross, non-current
$ 901 
$ 908 
Allowance for financing receivables, non-current
(80)
(79)
Financing receivables, net, non-current
359 
635 
Financing receivables, gross, current
129 
135 
Allowance for financing receivables, current
(12)
(14)
Current portion of financing receivables, net
52 
94 
Financing receivables, net
938 
950 
Securitized timeshare financing receivables [member]
 
 
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Financing receivables, gross, non-current
491 
205 
Allowance for financing receivables, non-current
(29)
(11)
Financing receivables, net, non-current
462 
194 
Financing receivables, gross, current
69 
29 
Allowance for financing receivables, current
(4)
(2)
Current portion of financing receivables, net
65 
27 
Financing receivables, net
527 
221 
Unsecuritized timeshare financing receivables [member]
 
 
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Financing receivables, gross, non-current
370 
654 
Allowance for financing receivables, non-current
(50)
(67)
Financing receivables, net, non-current
320 
587 
Financing receivables, gross, current
58 
106 
Allowance for financing receivables, current
(8)
(12)
Current portion of financing receivables, net
50 
94 
Financing receivables, net
370 
681 
Other financing receivables [member]
 
 
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Financing receivables, gross, non-current
40 
49 
Allowance for financing receivables, non-current
(1)
(1)
Financing receivables, net, non-current
39 
48 
Financing receivables, gross, current
Allowance for financing receivables, current
Current portion of financing receivables, net
Financing receivables, net
41 
48 
Financing Receivable [Member]
 
 
Accounts, Notes, Loans and Financing Receivable [Line Items]
 
 
Financing receivables, net, non-current
821 
829 
Current portion of financing receivables, net
$ 117 
$ 121 
Financing Receivables - Schedule of Allowance Uncollectible Timeshare Financing Receivables (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Timeshare Allowance for Uncollectible Accounts [Roll Forward]
 
 
Beginning balance
$ 92 
$ 93 
Write-offs
(16)
(11)
Provision for uncollectibles on sales
15 
13 
Ending balance
$ 91 
$ 95 
Financing Receivables - Schedule of Maturities of Timeshare Financing Receivables (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2013
Dec. 31, 2012
Jun. 30, 2014
Securitized timeshare financing receivables [member]
Jun. 10, 2014
Securitized timeshare financing receivables [member]
Aug. 31, 2013
Securitized timeshare financing receivables [member]
Jun. 30, 2014
Unsecuritized timeshare financing receivables [member]
Schedule of Maturities of Timeshare Financing Receivables [Line Items]
 
 
 
 
 
 
 
 
2014 (remaining)
 
 
 
 
$ 34 
 
 
$ 35 
2015
 
 
 
 
70 
 
 
45 
2016
 
 
 
 
73 
 
 
48 
2017
 
 
 
 
75 
 
 
49 
2018
 
 
 
 
75 
 
 
48 
Thereafter
 
 
 
 
233 
 
 
203 
Timeshare financing receivables, gross
 
 
 
 
560 
357 
255 
428 
Allowance for uncollectible timeshare financing receivables
(91)
(92)
(95)
(93)
(33)
 
 
(58)
Timeshare financing receivables, net
 
 
 
 
$ 527 
 
 
$ 370 
Financing Receivables - Aged Analysis of Gross Timeshare Financing Receivables (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Accounts, Notes, Loans and Financing Receivable, Gross, Allowance, and Net [Abstract]
 
 
Current
$ 947 
$ 948 
30 - 89 days past due
10 
14 
90 - 119 days past due
120 days and greater past due
28 
28 
Financing Receivable, Gross
$ 988 
$ 994 
Financing Receivables - Additional Information (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2014
Securitized timeshare financing receivables [member]
Jun. 10, 2014
Securitized timeshare financing receivables [member]
Aug. 31, 2013
Securitized timeshare financing receivables [member]
Schedule of Maturities of Timeshare Financing Receivables [Line Items]
 
 
 
 
 
Gross timeshare financing receivables secured under securitized timeshare debt
 
 
$ 560 
$ 357 
$ 255 
Securitized timeshare debt, face amount
 
 
 
 
250 
Securitized timeshare debt stated interest rate
 
 
 
 
2.28% 
Timeshare financing receivables secured under timeshare facility
169 
492 
 
 
 
Number of timeshare financing receivables outstanding
51,840 
 
 
 
 
Timeshare financing receivables range of stated interest rates, minimum
0.00% 
 
 
 
 
Timeshare financing receivables range of stated interest rates, maximum
20.50 
 
 
 
 
Timeshare financing receivables weighted average stated interest rate
12.16 
 
 
 
 
Timeshare financing receivables weighted average remaining term
7.44 
 
 
 
 
Nonaccrual timeshare financing receivables
$ 31 
$ 32 
 
 
 
Investments in Affiliates - Schedule of Investments (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures [Abstract]
 
 
Equity investments
$ 240 
$ 245 
Other investments
17 
15 
Investments in affiliates
$ 257 
$ 260 
Investments in Affiliates - Additional Information (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Equity Method Investments and Joint Ventures [Abstract]
 
 
Number of hotels owned or leased by unconsolidated joint ventures
27 
30 
Debt of unconsolidated joint ventures
$ 1,000 
$ 1,100 
Unconsolidated affiliates creditor debt
$ 17 
$ 17 
Consolidated Variable Interest Entities (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Dec. 31, 2013
Dec. 31, 2012
Variable Interest Entity [Line Items]
 
 
 
 
 
 
Number of consolidated variable interest entities
 
 
 
Cash and cash equivalents
$ 545 
$ 661 
$ 545 
$ 661 
$ 594 
$ 755 
Property and equipment, net
9,036 
 
9,036 
 
9,058 
 
Financing Receivable, Net
938 
 
938 
 
950 
 
Interest income
 
 
Interest expense
158 
131 
311 
274 
 
 
Non-Cash Capital Lease Asset Reduction
 
 
 
(44)
 
 
Non-Cash Capital Lease Obligation Reduction
 
 
 
(48)
 
 
Japan VIEs [member]
 
 
 
 
 
 
Variable Interest Entity [Line Items]
 
 
 
 
 
 
Number of consolidated variable interest entities
 
 
 
 
Cash and cash equivalents
34 
 
34 
 
42 
 
Property and equipment, net
38 
 
38 
 
26 
 
Non-recourse debt, including current maturities
287 
 
287 
 
284 
 
Interest expense
10 
15 
 
 
Non-Cash Capital Lease Asset Reduction
 
 
 
44 
 
 
Non-Cash Capital Lease Obligation Reduction
 
 
 
48 
 
 
Securitized Timeshare Debt VIE [member]
 
 
 
 
 
 
Variable Interest Entity [Line Items]
 
 
 
 
 
 
Restricted cash and cash equivalents
22 
 
22 
 
 
Financing Receivable, Net
527 
 
527 
 
221 
 
Non-recourse debt, including current maturities
548 
 
548 
 
222 
 
Interest income
12 
 
19 
 
 
 
Interest expense
$ 2 
 
$ 3 
 
 
 
Debt - Long-term Debt (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Debt Instrument [Line Items]
 
 
Long-term debt and capital lease obligations, gross, including current maturities
$ 11,343 
$ 11,784 
Current maturities of long-term debt
(3)
(4)
Unamortized discount on senior secured term loan facility
(26)
(29)
Long-term debt
11,314 
11,751 
Senior secured term loan facility [member]
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, interest rate, stated percentage
3.50% 
 
Long-term debt, gross
5,550 
6,000 
Senior notes [member]
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, interest rate, stated percentage
5.625% 
 
Long-term debt, gross
1,500 
1,500 
Commercial mortgage-backed securities loan [member]
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, weighted average interest rate
4.05% 
 
Long-term debt, gross
3,500 
3,500 
Mortgage loan [member]
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, interest rate, stated percentage
2.30% 
 
Long-term debt, gross
525 
525 
Mortgage notes [member]
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, weighted average interest rate
6.15% 
 
Long-term debt, gross
132 
133 
Other unsecured notes [member]
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, interest rate, stated percentage
7.50% 
 
Long-term debt, gross
54 
53 
Capital lease obligations [member]
 
 
Debt Instrument [Line Items]
 
 
Debt instrument, weighted average interest rate
6.04% 
 
Long-term debt, gross
$ 82 
$ 73 1
Debt - Additional Information (Details) (USD $)
6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Restricted Cash and Cash Equivalents Items [Line Items]
 
 
Restricted cash and cash equivalents
$ 284,000,000 
$ 266,000,000 
Voluntary repayments of long-term debt
450,000,000 
 
Letters of credit outstanding under revolving credit facility
48,000,000 
 
Line of credit facility, maximum borrowing capacity
1,000,000,000 
 
Line of credit facility, remaining borrowing capacity
952,000,000 
 
Number of hotels securing CMBS loan
23 
 
Commercial mortgage-backed securities loan [member]
 
 
Restricted Cash and Cash Equivalents Items [Line Items]
 
 
Restricted cash and cash equivalents
33,000,000 
29,000,000 
Timeshare debt agreements [member]
 
 
Restricted Cash and Cash Equivalents Items [Line Items]
 
 
Restricted cash and cash equivalents
$ 27,000,000 
$ 20,000,000 
Debt - Non-recourse Debt (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2014
Capital lease obligations of consolidated VIEs [member]
Dec. 31, 2013
Capital lease obligations of consolidated VIEs [member]
Jun. 30, 2014
Non-recourse debt of consolidated VIEs [member]
Dec. 31, 2013
Non-recourse debt of consolidated VIEs [member]
Jun. 30, 2014
Timeshare Facility [member]
Dec. 31, 2013
Timeshare Facility [member]
Jun. 30, 2014
Securitized Timeshare Debt [member]
Dec. 31, 2013
Securitized Timeshare Debt [member]
Jun. 10, 2014
Securitized Timeshare Debt 1.77 Notes [Member]
Jun. 10, 2014
Securitized Timeshare Debt 2.07 Notes [Member]
Non-recourse Debt [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
Debt instrument, interest rate, stated percentage
 
 
6.34% 
 
 
 
1.48% 
 
1.98% 
 
1.77% 
2.07% 
Debt instrument, weighted average interest rate
 
 
 
 
3.38% 
 
 
 
 
 
 
 
Non-recourse debt, including current maturities
 
 
$ 259 
$ 255 
$ 40 
$ 41 
$ 150 
$ 450 
$ 548 
$ 222 
$ 304 
$ 46 
Non-recourse debt and capital lease obligations, including current maturities
997 
968 
 
 
 
 
 
 
 
 
 
 
Current maturities of non-recourse debt
(107)
(48)
 
 
 
 
 
 
 
 
 
 
Non-recourse debt
$ 890 
$ 920 
 
 
 
 
 
 
 
 
 
 
Debt - Debt Maturities (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Debt Disclosure [Abstract]
 
2014 (remaining)
$ 61 
2015
109 
2016
363 
2017
139 
2018
4,110 
Thereafter
7,558 
Long-term debt and capital lease obligations, gross
$ 12,340 
Derivative Instruments and Hedging Activities - Additional Information (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2013
Interest rate caps [member]
Secured debt interest rate caps [member]
Jun. 30, 2014
Interest rate caps [member]
Mortgage loan interest rate cap [member]
Jun. 30, 2014
Interest rate caps [member]
CMBS loan interest rate cap [member]
Jun. 30, 2014
Term loan interest rate swaps [member]
Derivative [Line Items]
 
 
 
 
Derivative, notional amount
$ 15,200 
$ 525 
$ 875 
$ 1,450 
Derivative, cap interest rate
 
4.00% 
6.00% 
 
Derivative, swaption interest rate
 
 
 
1.87% 
Number of interest rate derivatives held
10 
Derivative Instruments and Hedging Activities - Fair Value of Derivative Instruments (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Designated as hedging instrument [member] |
Term loan interest rate swaps [member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Interest rate swaps, liability
$ 5 
 
Derivative fair value
 
10 
Not designated as hedging instrument [member] |
Interest rate caps [member]
 
 
Derivatives, Fair Value [Line Items]
 
 
Derivative fair value
$ 0 
$ 0 
Derivative Instruments and Hedging Activities - Earnings Effect of Derivative Instruments (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Derivative Instruments and Hedging Activities Disclosure [Abstract]
 
 
 
 
Derivative instruments, gain (loss) recognized in income, ineffective portion and amount excluded from effectiveness testing, net
$ 0 
 
$ 0 
 
Derivative instruments, gain (loss) recognized in other comprehensive income (loss), effective portion, net
(9)
(14)
Gain (loss) on interest rate derivative instruments not designated as hedging instruments
$ 0 
$ 0 
$ 0 
$ 0 
Fair Value Measurements (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Timeshare financing receivables
$ 988 
$ 994 
Carrying amount
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash equivalents
291 
309 
Restricted cash equivalents
94 
107 
Timeshare financing receivables
988 
994 
Interest rate swaps, asset
 
10 
Long-term debt
11,235 1
11,682 1
Non-recourse debt, including current maturities
698 
672 
Interest rate swaps, liability
 
Level 1
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash equivalents
Restricted cash equivalents
Timeshare financing receivables
Interest rate swaps, asset
 
Long-term debt
59 
57 
Non-recourse debt
Interest rate swaps, liability
 
Level 2
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash equivalents
291 
309 
Restricted cash equivalents
94 
107 
Timeshare financing receivables
Interest rate swaps, asset
 
10 
Long-term debt
1,598 
1,560 
Non-recourse debt
Interest rate swaps, liability
 
Level 3
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Cash equivalents
Restricted cash equivalents
Timeshare financing receivables
990 
996 
Interest rate swaps, asset
 
Long-term debt
9,862 
10,358 
Non-recourse debt
701 
670 
Interest rate swaps, liability
 
Capital lease obligations [member]
 
 
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
 
 
Long-term debt, gross
$ 82 
$ 73 1
Income Taxes (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Income Tax Disclosure [Abstract]
 
 
Unrecognized tax benefits
$ 379 
$ 435 
Unrecognized tax benefits, income tax penalties and interest accrued
17 
45 
Unrecognized tax benefits, period increase (decrease)
(56)
 
Unrecognized tax benefits, income tax penalties and interest accrued, period increase (decrease)
(28)
 
Significant change in unrecognized tax benefits is reasonably possible, amount of unrecorded benefit
 
Unrecognized tax benefits that would impact effective tax rate
$ 342 
$ 340 
Employee Benefit Plans - Net Periodic Pension Cost (Credit) (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Domestic plan [member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Service cost
$ 2 
$ 1 
$ 4 
$ 2 
Interest cost
Expected return on plan assets
(5)
(6)
(9)
(10)
Amortization of prior service cost (credit)
(1)
(2)
Amortization of net loss
Settlement losses
Net periodic pension cost (credit)
U.K. plan [member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Service cost
Interest cost
Expected return on plan assets
(6)
(6)
(12)
(11)
Amortization of prior service cost (credit)
Amortization of net loss
Settlement losses
Net periodic pension cost (credit)
(2)
(3)
International plans [member]
 
 
 
 
Defined Benefit Plan Disclosure [Line Items]
 
 
 
 
Service cost
Interest cost
Expected return on plan assets
(1)
(1)
(2)
(2)
Amortization of prior service cost (credit)
Amortization of net loss
Settlement losses
Net periodic pension cost (credit)
$ 1 
$ 1 
$ 2 
$ 3 
Employee Benefit Plans - Additional Information (Details) (Domestic plan [member], USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Domestic plan [member]
 
Defined Benefit Plan Disclosure [Line Items]
 
Court ordered posted bond
$ 76 
Share-Based Compensation - Additional Information (Details) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Compensation expense
$ 6 
$ 1 
$ 19 
$ 3 
Cash-based LTI plan termination compensation expense reduction
 
 
25 
 
2013 Omnibus Incentive Plan [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Compensation expense
24 
 
35 
 
Unrecognized compensation costs related to unvested awards
146 
 
146 
 
Unrecognized compensation costs related to unvested awards, weighted-average period
 
 
2 years 2 months 
 
Shares of common stock reserved for future issuance
72,404,038 
 
72,404,038 
 
2013 Omnibus Incentive Plan [member] |
Restricted stock units (RSUs) [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Shares granted during the period
 
 
7,066,153 
 
Weighted average grant-date fair value
 
 
$ 21.53 
 
2013 Omnibus Incentive Plan [member] |
Restricted stock units (RSUs) [member] |
Minimum [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Vesting period
 
 
2 years 
 
2013 Omnibus Incentive Plan [member] |
Restricted stock units (RSUs) [member] |
Maximum [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Vesting period
 
 
3 years 
 
2013 Omnibus Incentive Plan [member] |
Stock options [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Options granted during the period
 
 
1,003,591 
 
Options, grants in period, weighted-average exercise price
 
 
$ 21.53 
 
Options, exercisable, number
 
 
Vesting period
 
 
3 years 
 
Options, grants in period, weighted-average grant-date fair value
 
 
$ 7.58 
 
Expiration period
 
 
10 years 
 
2013 Omnibus Incentive Plan [member] |
Performance shares [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Shares granted during the period
 
 
1,078,908 
 
Vesting period
 
 
3 years 
 
Vesting rights
 
 
zero to 200 percent payout 
 
Nonvested awards
1,078,908 
 
1,078,908 
 
Weighted-average remaining contractual terms
 
 
2 years 6 months 
 
2013 Omnibus Incentive Plan [member] |
Relative shareholder return [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Vesting rights, percentage
 
 
50.00% 
 
Weighted average grant-date fair value
 
 
$ 23.56 
 
2013 Omnibus Incentive Plan [member] |
EBITDA CAGR [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Vesting rights, percentage
 
 
50.00% 
 
Weighted average grant-date fair value
 
 
$ 21.53 
 
Method of measuring cost of award
 
 
target amount of 100 percent 
 
Promote Plan [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Compensation expense
19 
Accelerated vesting
 
 
remaining 60 percent of each participant's award 
 
Accelerated compensation cost
 
 
 
Unrecognized compensation costs, related to unvested awards, other than options
78 
 
78 
 
Promote Plan [member] |
Immediate [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Vesting rights, percentage
 
 
40.00% 
 
Promote Plan [member] |
1 year [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Vesting rights, percentage
 
 
40.00% 
 
Unrecognized compensation costs, related to unvested awards, other than options
10 
 
10 
 
Promote Plan [member] |
Sponsor less than 50 percent ownership [member]
 
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
 
Vesting rights, percentage
 
 
20.00% 
 
Vesting rights
 
 
the date that The Blackstone Group L.P. and its affiliates ("Blackstone" or "our Sponsor") cease to own 50 percent or more of the shares of the Company 
 
Unrecognized compensation costs, related to unvested awards, other than options
$ 68 
 
$ 68 
 
Earnings Per Share (Details) (USD $)
In Millions, except Per Share data, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Earnings Per Share [Abstract]
 
 
 
 
Net income (loss) attributable to Hilton Stockholders
$ 209 
$ 155 
$ 332 
$ 189 
Basic EPS:
 
 
 
 
Weighted average shares outstanding
985 
921 
985 
921 
Basic EPS
$ 0.21 
$ 0.17 
$ 0.34 
$ 0.20 
Diluted EPS:
 
 
 
 
Weighted average shares outstanding
985 
921 
985 
921 
Diluted EPS
$ 0.21 
$ 0.17 
$ 0.34 
$ 0.20 
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount
 
 
 
Accumulated Other Comprehensive Loss - Schedule of Accumulated Other Comprehensive Loss (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Beginning balance
$ (264)
$ (406)
Other comprehensive income (loss) before reclassifications
80 
(189)
Amounts reclassified from accumulated other comprehensive loss
(2)
Net current period other comprehensive income (loss)
78 
(185)
Ending balance
(186)
(591)
Currency translation adjustment [member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Beginning balance
(136)
(212)
Other comprehensive income (loss) before reclassifications
87 
(197)
Amounts reclassified from accumulated other comprehensive loss
(4)
Net current period other comprehensive income (loss)
83 
(197)
Ending balance
(53)
(409)
Pension liability adjustment [member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Beginning balance
(134)
(194)
Other comprehensive income (loss) before reclassifications
Amounts reclassified from accumulated other comprehensive loss
Net current period other comprehensive income (loss)
12 
Ending balance
(130)
(182)
Cash flow hedge adjustment [member]
 
 
Accumulated Other Comprehensive Income (Loss) [Line Items]
 
 
Beginning balance
 
Other comprehensive income (loss) before reclassifications
(9)
 
Amounts reclassified from accumulated other comprehensive loss
 
Net current period other comprehensive income (loss)
(9)
 
Ending balance
$ (3)
 
Accumulated Other Comprehensive Loss - Reclassifications Out of Accumulated Other Comprehensive Loss (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
Sale and liquidation of foreign assets
$ 4 
 
Amounts reclassified from accumulated other comprehensive loss
(4)
Currency translation adjustment [member]
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
Sale and liquidation of foreign assets
(1)
Gains on net investment hedges
Tax benefit (expense)
Total currency translation adjustment reclassifications for the period, net of taxes
Pension liability adjustment [member]
 
 
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
 
 
Amortization of prior service credit (cost)
(2)
(1)
Amortization of net gain (loss)
(1)
(5)
Tax benefit (expense)
Total pension liability adjustment reclassifications for the period, net of taxes
$ (2)
$ (4)
Business Segments - Hotel Properties by Segment (Details)
6 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Segment Reporting [Abstract]
 
 
Number of operating business segments
 
Number of wholly owned and leased hotels and resorts
118 
 
Number of non-wholly owned hotel properties
 
Number of hotels of consolidated VIEs
 
Number of hotels owned or leased by unconsolidated joint ventures
27 
30 
Number of non-hotels owned by unconsolidated affiliates
 
Number of managed hotels
517 
 
Number of franchised hotels
3,489 
 
Number of timeshare properties
44 
 
Business Segments - Reconciliation of Revenue and Adjusted EBITDA from Segment Amounts to Consolidated Amounts (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
$ 2,667 
$ 2,380 
$ 5,030 
$ 4,643 
Adjusted EBITDA
651 
590 
1,195 
1,037 
Charges to timeshare operations for rental and other fees
14 
12 
Other charges from consolidated owned and leased properties
Charges to consolidated owned and leased properties for management, royalty and IP fees
29 
26 
56 
47 
Charges to timeshare operations for licensing fees
11 
13 
22 
25 
Charges to consolidated owned and leased properties for laundry services
Ownership [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
1,126 1 2
1,078 1 2
2,078 1 2
1,998 1 2
Adjusted EBITDA
291 1 2 3 4 5
271 1 2 3 4 5
470 1 2 3 4 5
445 1 2 3 4 5
Management and franchise [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
371 3
326 3
702 3
608 3
Adjusted EBITDA
371 3
326 3
702 3
608 3
Timeshare [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
276 
261 
555 
507 
Adjusted EBITDA
69 1 3
60 1 3
154 1 3
119 1 3
Operating segments [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
1,773 
1,665 
3,335 
3,113 
Other revenues from managed and franchised properties for segment reporting [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
920 
750 
1,747 
1,591 
Other revenues for segment reporting [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
25 4
15 4
46 4
30 4
Intersegment eliminations [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Total revenues
(51)1 2 3 4
(50)1 2 3 4
(98)1 2 3 4
(91)1 2 3 4
Corporate and other [member]
 
 
 
 
Reconciliation of Revenues and Adjusted EBITDA from Segment Amounts to Consolidated Amounts [Line Items]
 
 
 
 
Adjusted EBITDA
$ (80)2 4
$ (67)2 4
$ (131)2 4
$ (135)2 4
[3] Includes management, royalty and intellectual property fees of $29 million and $26 million for the three months ended June 30, 2014 and 2013, respectively, and $56 million and $47 million for the six months ended June 30, 2014 and 2013, respectively. These fees are charged to consolidated owned and leased properties and were eliminated in our condensed consolidated financial statements. Also includes a licensing fee of $11 million and $13 million for the three months ended June 30, 2014 and 2013, respectively, and $22 million and $25 million for the six months ended June 30, 2014 and 2013, respectively, which is charged to our timeshare segment by our management and franchise segment and was eliminated in our condensed consolidated financial statements. While the net effect is zero, our measures of segment revenues and Adjusted EBITDA include these fees as a benefit to the management and franchise segment and a cost to ownership Adjusted EBITDA and timeshare Adjusted EBITDA.
Business Segments - Reconciliation of Adjusted EBITDA to Net Income (Loss) Attributable to Hilton Stockholders (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Jun. 30, 2014
Jun. 30, 2013
Segment Reporting [Abstract]
 
 
 
 
Adjusted EBITDA
$ 651 
$ 590 
$ 1,195 
$ 1,037 
Net loss (income) attributable to noncontrolling interests
(3)
(2)
(4)
(6)
Gain (loss) on foreign currency transactions
32 
(39)
46 
(82)
FF&E replacement reserve
(12)
(10)
(23)
(17)
Share-based compensation expense
(6)
(1)
(19)
(3)
Other gain (loss), net
11 
(1)
14 
Other adjustment items
(17)
(9)
(30)
(20)
EBITDA
656 
528 
1,179 
915 
Interest expense
(158)
(131)
(311)
(274)
Interest expense included in equity in earnings (losses) from unconsolidated affiliates
(3)
(2)
(6)
(6)
Income tax benefit (expense)
(121)
(84)
(204)
(122)
Depreciation and amortization
(158)
(149)
(311)
(309)
Depreciation and amortization included in equity in earnings (losses) from unconsolidated affiliates
(7)
(7)
(15)
(15)
Net income (loss) attributable to Hilton Stockholders
$ 209 
$ 155 
$ 332 
$ 189 
Business Segments - Schedule of Assets by Segment (Details) (USD $)
In Millions, unless otherwise specified
Jun. 30, 2014
Dec. 31, 2013
Segment Reporting, Asset Reconciling Item [Line Items]
 
 
Total assets
$ 26,497 
$ 26,562 
Ownership [member]
 
 
Segment Reporting, Asset Reconciling Item [Line Items]
 
 
Total assets
11,851 
11,936 
Management and franchise [member]
 
 
Segment Reporting, Asset Reconciling Item [Line Items]
 
 
Total assets
10,726 
11,016 
Timeshare [member]
 
 
Segment Reporting, Asset Reconciling Item [Line Items]
 
 
Total assets
1,836 
1,871 
Corporate and other [member]
 
 
Segment Reporting, Asset Reconciling Item [Line Items]
 
 
Total assets
$ 2,084 
$ 1,739 
Business Segments - Schedule of Capital Expenditures by Segment (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended
Jun. 30, 2014
Jun. 30, 2013
Segment Reporting, Capital Expenditure Reconciling Item [Line Items]
 
 
Capital expenditures for property and equipment
$ 110 
$ 121 
Ownership [member]
 
 
Segment Reporting, Capital Expenditure Reconciling Item [Line Items]
 
 
Capital expenditures for property and equipment
106 
116 
Timeshare [member]
 
 
Segment Reporting, Capital Expenditure Reconciling Item [Line Items]
 
 
Capital expenditures for property and equipment
Corporate and other [member]
 
 
Segment Reporting, Capital Expenditure Reconciling Item [Line Items]
 
 
Capital expenditures for property and equipment
$ 3 
$ 3 
Commitments and Contingencies (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended 12 Months Ended 12 Months Ended
Jun. 30, 2014
Dec. 31, 2013
Jun. 30, 2014
Guarantees for debt and other obligations of third parties [member]
Jun. 30, 2014
Management contract performance guarantees [member]
Dec. 31, 2013
Management contract performance guarantees [member]
Jun. 30, 2014
Commitments for capital expenditures [member]
Dec. 31, 2013
Timeshare inventory purchase commitment [member]
Jun. 30, 2014
Timeshare inventory purchase commitment [member]
Dec. 31, 2010
Settlement guarantee [member]
Jun. 30, 2014
Settlement guarantee [member]
Commitments and Contingencies [Line Items]
 
 
 
 
 
 
 
 
 
 
Guarantor obligations, maximum exposure, undiscounted
 
 
$ 27 
$ 150 
 
 
 
 
 
$ 37 
Guarantor Obligations, Term
 
 
four months to nine years 
2018 to 2030 
 
 
 
 
 
 
Number of letters of credit pledged as collateral
 
 
 
 
 
 
 
 
 
Letters of credit outstanding, amount
 
 
27 
 
 
 
 
 
 
 
Number of guarantees with pledged collateral
 
 
 
 
 
 
 
 
 
Number of contracts with performance guarantees
 
 
 
 
 
 
 
 
 
Current liabilities
2,120 
2,142 
 
 
 
 
 
 
 
Non-current liabilities
 
 
 
46 
51 
 
 
 
 
 
Purchase commitment, remaining minimum amount committed
 
 
 
 
 
144 
 
 
 
 
Long-term purchase commitment, amount
 
 
 
 
 
 
92 
 
 
 
Long-term purchase commitment, time period
 
 
 
 
 
 
4 years 0 months 0 days 
 
 
 
Quarterly purchase commitment, amount
 
 
 
 
 
 
 
 
 
Purchase commitment satisfied
 
 
 
 
 
 
 
46 
 
 
2014 contractual obligation
 
 
 
 
 
 
 
12 
 
 
2015 contractual obligation
 
 
 
 
 
 
 
24 
 
 
2016 contractual obligation
 
 
 
 
 
 
 
10 
 
 
Litigation settlement, amount
 
 
 
 
 
 
 
 
$ 75 
 
Subsequent Events (Details) (USD $)
In Millions, unless otherwise specified
6 Months Ended 1 Months Ended
Jun. 30, 2014
Jul. 31, 2014
Subsequent event [member]
Subsequent Event [Line Items]
 
 
Voluntary repayments of long-term debt
$ 450 
$ 150 
Number of hotels in JV portfolio
 
11 
Number of hotels to be removed from JV portfolio
 
Number of hotels to be retained and wholly owned
 
Ownership percentage of retained hotels
 
100.00%