Coronavirus update: Hilton shuts down the operations of 150 hotels in China
Hilton estimates a percentage point impact on RevPAR, or revenue per available room, a key metric in the hotel industry.
Coronavirus, as per records, has now claimed more than 1000 lives in China and almost 43,000 lives worldwide. Now, since the start it has been taking a toll on hospitality and tourism industry. However, now things have taken a negative turn.
Hilton has closed 150 of its hotels, containing 33,000 rooms in China owing travelers' concerns over contracting the coronavirus if travelled to China. This was announced by Hilton CEO Christopher Nassetta on the company’s post-earnings conference call.
Assuming that the outbreak lasts three to six months, with an additional three to six month recovery period, Hilton expects a $25 million to $50 million hit on full-year adjusted EBIDTA, he said. The company estimates a percentage point impact on RevPAR, or revenue per available room, a key metric in the hotel industry.
Nassetta said later on the call that the situation was evolving. “We’re reporting at a time where we know a bunch but not that much relative to where this thing is going,” he said. He noted that China represents 2.7% of company’s overall EBIDTA. Hilton shares were up 2% at $113.74 in afternoon trading after the company reported an earnings beat.