What was the operating income for Embassy Suites By Hilton in 2024?
Embassy_Suites_By_Hilton Franchise · 2025 FDDAnswer from 2025 FDD Document
equity, including the activity during the years ended December 31, 2024, 2023 and 2022, see Note 8: Related Party Transactions.
See notes to financial statements.
Hilton Franchise Holding LLC Statements of Cash Flows (in thousands)
2024 2023 2022 Operating Activities: Net income $ 1,487,571 $ 1,372,281 $ Adjustments to reconcile net income to net cash provided by operating activities: Amortization of contract acquisition costs 16,053 12,897 Amortization expense 3,751 414 Franchise contract acquisition costs, net of refunds (81,063) (37,185) Changes in operating assets and liabilities: Accounts receivable, net (7,971) (5,787) Other receivables due from Hilton affiliates 64,535 30,383 Other current assets (2,269) (54) Other current liabilities 5 10 Change in other non-current assets (7) 85 Change in deferred revenues 34,651 46,130 Change in other long-term liabilities (5,568) 5,405 Decrease (increase) in due from Hilto
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 97)
What This Means (2025 FDD)
According to Embassy Suites By Hilton's 2025 Franchise Disclosure Document, the net income for operating activities in 2024 was $1,487,571 (in thousands). This figure represents the company's earnings from its core business operations before accounting for interest, taxes, and other non-operating items. It is a key indicator of the company's profitability and efficiency in generating revenue from its franchise activities.
For a prospective Embassy Suites By Hilton franchisee, understanding the net income is crucial as it reflects the financial health and stability of the franchisor. A strong and growing net income suggests that the franchisor is managing its operations effectively and has a sustainable business model. This can provide reassurance to franchisees about the potential for long-term success and support from a financially sound parent company.
However, it's important to note that this figure is part of a consolidated statement and may not directly translate to the profitability of individual franchised locations. Factors such as amortization of contract acquisition costs, changes in assets and liabilities, and related-party transactions with Hilton affiliates also influence the net income. Therefore, while the net income provides a general overview of the franchisor's financial performance, prospective franchisees should also consider other financial metrics and conduct their own due diligence to assess the potential profitability of their specific franchise.
Furthermore, the FDD also includes statements of cash flows, which provide additional insights into the company's financial activities. For 2024, the net cash provided by operating activities was $1,516,760 (in thousands). This figure indicates the actual cash generated from the company's operations, which can be used for investments, debt repayment, and other strategic initiatives. Reviewing both net income and cash flow statements can offer a more comprehensive understanding of the franchisor's financial strength and its ability to support its franchisees.