Hyatt’s (H) improving operating metrics have resulted in a strong growth in revenue. The company’s total revenue has grown from $3,527 million in 2010 to $4,415 million in 2014.
In 2014, Hyatt recorded an annual growth rate of 5.5% in 2014 over 2013, when its revenue grew from $4,185 million to $4,415 million. In this article, we will discuss the performance of each business segment.
Revenue by segment
Owned and leased revenue consists of proceeds from room rentals and revenues from all other services provided in those facilities. Revenues from owned and leased hotels across the world contribute more than 50% to the Hyatt’s total revenue. Its revenue has grown from $1,859 million in 2010 to $2,246 million in 2014. Growth was largely driven by strong performance in the US, where the majority of the owned and leased hotels are located. Hyatt benefited from growing business travel and transient travel and increased spending on food and beverage.
Growth was largely driven by strong performance in the US, where the majority of the owned and leased hotels are located. Hyatt benefited from growing business and transient travel, and it increased its spending on food and beverages.
America’s franchised and managed properties grew its revenues by $103 million in 2014 over 2013. Revenue from this division was at $1,877 million in 2014, growing from $1,712 million in 2012. This is mainly driven by Hyatt’s increased focus on the franchised and management model.
ASPAC franchised and managed division is one of Hyatt’s fastest-growing business segments. Revenues increased from $129 million in 2012 to $162 million in 2014, driven largely by capacity growth and RevPAR growth.
EAME/SW Asia franchised and managed division is Hyatt’s fastest-growing division. Its revenues grew from $92 million in 2012 to $130 million in 2014. Growing capacity and occupancy rates drove the revenue growth in the region.
Investors can gain exposure to the lodging sector by investing in the iShares US Consumer Services ETF (IYC). IYC invests 11.5% of its holdings in the lodging sector, which includes 0.5% in Marriott (MAR), 0.4% in Starwood (HOT), and 0.39% in Hilton (HLT).