Hilton chief expects bounceback in second half of 2021
'Light is at the end of the tunnel', CEO Christopher Nassetta says
The second half of 2021 "is going to be a lot better than everybody thinks", the chief executive of the Hilton hotels business said.
The hospitality industry is "still in the eye of the storm" caused by the Covid-19 pandemic, and the next 60-90 days are going to be "very difficult", Christopher Nassetta, president and chief executive of Hilton told the Bloomberg Year Ahead event on Tuesday evening.
"There are parts of the world that had been doing well that are doing less well – Europe, Asia Pacific, even China more recently," Mr Nassetta said.
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Despite this, "the light is at the end of the tunnel," he added. "Objectively, you can see the steps in place. We have a political cycle over with, a new administration, an intense focus on getting us through the crisis in terms of what’s going on with the rollout of vaccines."
Like many companies in the hospitality sector, Hilton has witnessed a significant fall in revenues as movement restrictions to stem the spread of the virus have been put in place in countries around the world.
The company's revenue for the first nine months of 2020 more than halved to $3.4bn, leading it to declare a loss to shareholders of $491m for the period, compared to a profit of $706m in the prior-year period.
Occupancy rates across its hotels stood at 40.4 per cent for the first nine months of 2020. Hilton had 6,333 hotels containing a total of 998,282 rooms in properties it either owned, managed or franchised as of September 30, 2020.
"What I’ve said to our team is the first quarter is going to be really challenging, the second quarter is not going to feel great and we’re going to be transitioning, but I think there’s going to be a real opportunity for the third and fourth quarter, where we get to the other side of the health crisis, to be a lot better than people think."
Mr Nassetta said the recovery is dependent on the rollout of vaccinations going well, with support from the political systems in terms of providing a "bridge" for workers and small businesses, so that "liquidity issues don’t turn into solvency issues".
Hilton will "strongly encourage" its workers to be vaccinated when appropriate, but will not require it, Mr Nassetta said.
Published: January 27, 2021 02:54 PM