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Business Segment Information
 9 Months Ended
Sep. 30, 2017
Segment Reporting [Abstract]  
Business Segment Information

Note 11: Business Segment Information

As of September 30, 2017, we have two operating segments, our consolidated hotels and unconsolidated hotels. Our unconsolidated hotels operating segment does not meet the definition of a reportable segment, thus our consolidated hotels is our only reportable segment. We evaluate our consolidated hotels primarily based on hotel adjusted earnings before interest expense, taxes and depreciation and amortization (“EBITDA”). Hotel Adjusted EBITDA is calculated as EBITDA, further adjusted to exclude:

 

•

Gains or losses on sales of assets for both consolidated and unconsolidated investments;

 

•

Gains or losses on foreign currency transactions;

 

•

Transition costs related to our establishment as an independent, publicly traded company;

 

•

Share-based compensation expense;

 

•

Non-cash impairment losses; and

 

•

Other gains or losses that management believes are not representative of our current or future operating performance.

 

The following table presents revenues for our consolidated hotels reconciled to our condensed combined consolidated amounts and Hotel Adjusted EBITDA to net income: 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2017

 

 

2016(1)

 

 

2017

 

 

2016(1)

 

 

 

(in millions)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total consolidated hotel revenue

 

$

685

 

 

$

667

 

 

$

2,096

 

 

$

2,047

 

Other revenue

 

 

3

 

 

 

4

 

 

 

9

 

 

 

10

 

Total revenues

 

$

688

 

 

$

671

 

 

$

2,105

 

 

$

2,057

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Hotel Adjusted EBITDA

 

$

182

 

 

$

201

 

 

$

573

 

 

$

615

 

Other revenue

 

 

3

 

 

 

4

 

 

 

9

 

 

 

10

 

Impairment loss

 

 

—

 

 

 

—

 

 

 

—

 

 

 

(15

)

Depreciation and amortization expense

 

 

(74

)

 

 

(73

)

 

 

(217

)

 

 

(220

)

Corporate and other expense

 

 

(20

)

 

 

(21

)

 

 

(57

)

 

 

(56

)

Interest income

 

 

1

 

 

 

—

 

 

 

2

 

 

 

1

 

Interest expense

 

 

(32

)

 

 

(49

)

 

 

(93

)

 

 

(141

)

Equity in earnings from investments in affiliates

 

 

6

 

 

 

6

 

 

 

18

 

 

 

16

 

(Loss) gain on foreign currency transactions

 

 

(1

)

 

 

1

 

 

 

(4

)

 

 

—

 

Income tax benefit (expense)

 

 

44

 

 

 

(26

)

 

 

2,344

 

 

 

(79

)

Loss from hurricane damage

 

 

(2

)

 

 

—

 

 

 

(2

)

 

 

—

 

Other gains and losses

 

 

(2

)

 

 

(6

)

 

 

(3

)

 

 

(9

)

Net income

 

$

105

 

 

$

37

 

 

$

2,570

 

 

$

122

 

  

(1)

Prior to the spin-off, we had one operating and reportable segment, our ownership segment. Prior period presentation has been restated to reflect our current reportable segment.

 

The following table presents total assets for our consolidated hotels, reconciled to condensed combined consolidated amounts:

 

 

 

September 30, 2017

 

 

December 31, 2016

 

 

 

(in millions)

 

Consolidated hotels

 

$

9,710

 

 

$

9,747

 

All other

 

 

93

 

 

 

87

 

 

 

$

9,803

 

 

$

9,834