Financial Analysis Report Hyatt Finance Essay

Financial Analysis Report Hyatt Finance Essay This report is prepared to analyse the financial statements for Hyatt Hotel Corp. I have analysed three years Balance Sheet and Income Statement for the year 2009 to 2011. An introduction has been provided with the key data of Hyatt, its geographic spread, market, brands, strategy and a brief history is covered. Income Statement Analysis is performed followed by various financial ratios, profitability ratio, solvency ratio, liquidity ration and activity ratios has been calculated and compared for the years 2009 to 2011. A discussion on how well the Hyatt has performed with in the industry has been provided. Its performance is benchmarked with two other industry leaders, Accor Hotels and Marriott Hotels. Some of the issues identified are discussed in conclusion. All the findings are supported with data available from the financial statements. Balance sheet analysis is done and various ratios have been discussed in details. Hyatts performance is evaluated for the year 2009, 2010 and 2011. At the end a conclusion is made followed by some recommendations to buy, sell or hold on the investment is provided. HYATT was established in 1957 by Mr. Jay Pritzker, after acquiring Hyatt House Motel located near Los Angeles International Airport. Hyatt became a public company sector company in 1962 as both Pritzker brothers Jay Donald expanded the family business into North American Management Hotel ownership country. Hyatt became the global hospitality leader after its Launching of innovatively designed Hyatt Regency Atlanta in 1967. Hyatt is now named as Hyatt Hotels Corporation after Hyatt International Hyatt Corporation was conjoined in to one company and operating for Pritzker Familys interest (Hyatt 2013). Hyatt believes in expansion, innovativeness diversification this represented by its 9 competitive brands owning 500 properties which are globally spread around the world into 46 countries. (Hyatt 2013). Each brand is designed uniquely to offer a distinguished experience of Food Beverages, ambience and services to the guests. It is their attitude and personalized touch that makes the stay memorable. Park Hyatt which is known for its luxury sophistication has a spread of 30 hotels in major gateway cities of America, Europe, Africa Middle East, and Southwest Asia Asia Pacific. ANDAZ as the name suggests has a unique design and at the same time has insights of local neighbourhood. The company has 9 hotels under this brand. Grand Hyatt has huge infrastructure and spectacular design, with innovative concepts of food and beverage. It is preferred brand for grand weddings, convections and meetings. Hyatt brand has 28 properties. Hyatt Regency is aimed for business travellers convention travellers, equipped with most of modern technologies and guest friendly atmosphere. Hyatt Place is ranked no. 1 select service brand by Business Travel News 2012 Survey, it has a wide range of 172 properties in United States and Costa Rica. Hyatt House was formerly known as Summerfield Suites and is designed in residential size to make the guest feel at home as it offers extended stay in all their 54 properties. Hyatt Resorts are all located at the vacation destinations thus they are well known as beach resort, mountain resort, dessert Resort etc. they are most conveniently constructed with all the leisure around to make the tour relaxing and adventurous. Hyatt Vacation Clubs are time share properties which offers ownership to the members to enjoy access to any Hyatt Vacation club in addition to their home destination, Hyatt entered into vacation ownership in 1994(Hyatt 2013). Hyatt has partnership with 19 diversified non profit organisations and contributes them in their various activities; this is a part of their social responsibility. Hyatt has identified specific market segments and their competitors in order to make their services the best and customer friendly, like introducing Web Check in for any Hyatt properties, various spas and leisure activities at tourists and business properties, has identified requirements of amenities by guest feedback and introduced it. The company understands that customer satisfaction is totally dependent on employee satisfaction in a service industry and their asset is their work force, therefore Global Hyatt was awarded as 2011 Best place to work. Hyatt has also been awarded as Best Elite program in Asia-2012 for boosting their guests loyalty through Gold, Diamond and Platinum memberships. This strategically planned program offers complimentary stays and services; this ensures higher frequency of their guests. One of i ts major introductions of competitive strategy is ANDAZ which is an eco friendly brand and an intelligent innovativeness to decrease the carbon footprints. Hyatt accomplishes it mission and goals by Diversity and Inclusive Framework for building and focusing on their work place, work force and market place (Hyatt 2013).Hyatt has 60 individual spas with the original concept of healing with water and it introduced its spa in 1972, in Indonesia. This is a strategy of diversification and expansion. Hyatt plans to introduce an Eco Track web based tool for monitoring Hyatts environmental impact by gathering monthly data of their environmental goals, it aims to start full fledge by 2015. This would include reduce energy consumption, water consumption, green house emission and waste sent to the landfills in comparison to 2006 levels. Hyatt Union Square in Manhattan along with restaurants of One Five hospitality group is in pipeline for April 2013, besides that Andaz Tokyo, first Andaz Hotel in Japan is to open in 2014. Park Hyatt Mallorca is the first Hyatt hotel in Mallorca, an island in Mediterranean for which Hyatt has entered into an agreement with Spanish real estate company. Moreover Hyatt plans for expansion and growth in the competitive hospitality industry by diversification and innovativeness (Hyatt 2013). Income Statement Analysis How has the group performed? In last three years of Hyatts performance (year 2009 to 2011) review I can state that its sales has been increased each year, the increase is not constant but each year has shown overall increase from the previous year as shown in Appendix-I Profit Loss Statement of Hyatt. The % movement (sales) of year 2009, 2010 and 2011 is 6, 5 and 11 respectively. From the last three years of review, it can be said that the performance indicators are showing a positive upward trend for the company (Hyatt 2013). The percentage movement of rooms in the year 2009 was not very promising for the company but the positive trend of sales improved the room % movement for the year 2010 and 2011 as 4.1 and 8.5 respectively. The average occupancy data supports the increase in sales for years 2009-2011. For the said period average occupancy is 65.7, 70.9 and 72.5. (Hyatt 2013) REVPAR defined as revenue per available room has shown an upward increase from year 2009 to 2011 ($103 to $122) refer to the values in Appendix-I Profit Loss Statement of Hyatt. The companys revenue has been on steady increase as per REVPAR. The average room rate (ARR) often known as average daily rate (ADR) has been on increase in the last three of review. The ADR or ARR for the said years are $157, $163 and $169 for the year 2009, 2011 and 2011 respectively. The % movement increase for the years 2009 to 2011 is 4% to 7.6%. The company has seen a growth of REVPAR despite some of its properties were under renovations during the period 2009-2010 as mentioned in the annual report of the company. From its North American Management and Franchising, the companys revenue has increased due to the increase in franchisee and other fees increased due to improved profitability across the portfolio. Hotel industry/companies are evaluated in terms their ability to generate profits on sales, known as profit margin. Poor pricing and sales volume can bring down the profit margin. The gross profit for the last three years of the company has increased from $579 to $741 thereby increasing the gross margin % from 17.4% to 20%. This shows that the company has been performing well and its management has control over its expenses. The net profit has fell sharply in the year 2009 which is -$43. This sharp fall was due to the high operating expenses and low operating income, added to it was low equity earnings and high interest expenses. Net profit shows a rapid upward trend in the year 2010 and 2011 i.e. $66 and $113. This was due to the high operating income at hand and low interest expenses. This indicates that the company has recovered from losses and looks more promising in the year 2010-11. The net profit margin of the company has increased from negative to positive value showing profitable growth earnings for the company. The net profit margin for the last three years is -1.29%, 1.87% and 3.06%. Benchmarking of the Company (Hyatt): The benchmarking of the company is performed with two of industry leaders named Accor Hotels and Marriott Hotels. Various financial ratios are compared for the years 2009, 2010 and 2011. Profitability comparison of two industries: ROA: Hyatt has shown a better return on assets or in other words a better profitability of hospitality industry (-0.65) as compared to Accor (-2.3) and Marriott (-5.3). The performance of Hyatts has been steady and its profitability has increased in three years term to 1.53%. In the year 2011, Hyatt is under performing as compared to Marriott but better than Accor which has ROA of 0.60% as shown in following graph: Fig 1 In the year 2010, Accor has a very high ROA followed by a sharp fall in year 2011, which indicates that very high fluctuations of ROA possess a higher risk of instability of the company. ROE: Another key ratio is return on equity which compares the net income of the companies with owners investment. Hyatts ROE has shown a gradual increase for the last three years. Compared to Accor and Marriott in the years 2009, it was the best investment company in hospitality. In 2010, Hyatt has shown a gradual increase of 1% on ROE as compared to Accor and Marriott which has shown a very sharp rise of 100% and 29% respectively. A company with a higher ROE is a better investment than one with a lower ROE since it has a stronger ability to generate cash flows internally; however, this is not completely accurate. Looking at the Accor and Marriott for the year 2010, they show a high ROE values, but the following year they have shown a greater investment risk as compared to Hyatt, the graph below represent the same. Fig 2 EBIT: Lower EBIT ratio means the company is less capable of meeting its liabilities. If the ratio is 1.5 or less, then it is considered a high risk and its ability to meet its interest expenses may be questionable. As compared in 2009, Hyatt is not performing well as compared with Marriott whose EBIT is 3% as compared to Hyatts -0.09; however, in 2011 the situation is upside down. Hyatt is performing well as compared to Marriott. The EBIT of Hyatt is -2.49% whereas Marriott stands on -12%, refer to the graph below: Fig 3 After analysing various financial ratios between three groups of hotels, I have analysed that, Hyatt has performed better and shown constant improvement in recent three years, whereas Accor and Marriotts have shown huge up and downs throughout, which describes these groups have less stability. Balance Sheet Analysis The total assets of Hyatt have shown an upward movement for the year 2009 to 2011 from $7,155 to $7,507 or in other words, the percentage movement of total assets has a sudden rise from 1% to 5% for the year 2009-2011. This is due the fact that the total non-current assets have increased from $5,146 to $5,916 even though the current assets have decreased from $2,009 to $1,591 for the said period. Looking at the current assets trend the financial perform has taken the downward trend from year 2009 to 2011. This downward trend of current assets has raised the questions about how quickly the company can meet its liabilities if the need arises? Combined with the non-current assets of the company the overall movement is upward. The reason for the increase in total assets is the year 2011 is due to the high increase in property equipment assets; refer to the Appendix-I Balance sheet of Hyatt. (Hyaat 2013) Current ratio of the company shows its liquidity power, in other words, liquidity ratio analyse the company ability to carry out its short term obligations. For companys liquidity ratio for the year 2009, 2010 and 2011 are 4.06, 3.63 and 2.8 respectively. High current ratio in the year 2009 and 2010 indicates a high risk as management was not investing the companys assets productively to grow the revenue in 2009-10. This also means that the company has too many idle assets not being invested. Total current liabilities has increased from year 2009 to 2011 from $495 to $568, this is mainly due to the Accrued expenses increase for the year 2011 from $188 to $306. The total current liabilities movement has taken a sharp dip from 20% to -5% and then rise to 15% for the year 2009, 2010 and 2011 respectively. This also led to the net assets for the company decreased from $5040 to $4828 from year 2009 to 2011. The inventory turnover rate of the company has risen from 25.1 in 2009 to 42.5 in 2011. This growth was appreciated by the shareholders because it implies that company has become more capable of efficiently turning its inventory into sales in these three years. Companys earnings before interest and taxes (EBIT) increased quickly in the last three years (from $5 to $142), which finally resulted in a big increase of profit margin in 2010. Return on assets measures how much profit a company can squeeze out of its assets. A higher return is preferred. The situation of the company is much better in the later years as compared to the starting years of analyses. Its return on assets ratio has increased year by year in the last three years. The ROA % has increased from -0.6% to 1.5%. Return on equity ratios are used to interpret a companys ability to generate earnings from its investments. (Andrew, Damitio, Schmidgall 2007). ROE% for the company has shown a steady increase from -1% in 2009 to 2% in 2011, the profit margin% increased to 3.06% from -1.29% (because companys net income had become positive) respectively(Hyatt 2013) Debt ratio measures how much debt a company has in its total assets. A lower debt ratio can be interpreted as the company being capable of carrying its liabilities since there are enough assets (Andrew, Damitio, Schmidgall 2007). Companys debt ratio increased from 42% to 55% thereby meaning that the companys ability to satisfy its liabilities has decreased. The financial leverage of the company is the ratio of its total liabilities and total assets. The lower the ratio is, the better the company is performing and has a lower risk of failing down or becoming bankrupt. The leverage ratio for the company has shown a decline from -29.6% to -35.7% from year 2009 to 2011 which shows a lower financial risk for the company. Interest coverage ratio determines companies ability to pays interest on outstanding debts, here company has shown constant downfall in interest cover from -0.09, -2.91 and -2.49 for year 2009-11 respectively. Here companies ability to meet interest expenses are questionable, company is in burden by debt expenses (Andrew, Damitio, Schmidgall 2007). Conclusion The Hyatt has shown an increase in its performance and reviewing its last three years of Income Statement and Balance Sheet it is evident that this group is doing better than its other two competitors in hospitality sector; however, there are some issues with its investment policies. Its management did not invest its assets efficiently which led to a higher current ratio in the year 2009-10 exposing the company as high risk to meet its liabilities. This behavior is also supported by return on assets ratio. In the later year, the company has shown a decline of leverage ratio, putting the company into better financial shape and making low risk company in its sector. To sum up, there was a significant increase in companys financial statement in 2011. Compared to 2009, its revenue and net income increased sharply, while its total assets grew by $7507 million dollars. The equity of company decreased to $4828 million, while there was an increase of the total liability to $2679 million. According to the previous analysis of Hyatt Hotel Corporations financial performance from 2009 to 2011, it is clear that company has experienced a sharp increase of its revenue and net income in 2011. One of the main reasons is that the occupancy rate and room rate increased. Overall, trends are looking decent and I would recommend buying the investments in the company.

“Lines Written in Early Spring,” by William Wordsworth Essay

â€Å"Lines Written in Early Spring,† by William Wordsworth, sets the tone within the title. The thought of early spring brings new life and harmony to the mind of the reader. A vision of Wordsworth sitting in a open field, observing the flowers budding and bunnies hopping around comes to the reader’s mind. He â€Å"heard a thousand blended notes† of birds singing and the world blooming around him, thoughts of Bambi are brought to mind. Spring, for me, creates a feeling of joy, and I think it is the best of the four seasons. A new start for all life to live as one and get along. The next two lines could be quite confusing after the first reading. A â€Å"sweet mood† causes his â€Å"pleasant thoughts/ [to] bring sad thoughts to mind.† At first, I wondered how a sweet mood and pleasant thoughts could possibly bring sad thoughts, but when I thought about it, I realized that sometimes when you’re at your happiest moment, sad memories and ponderings come to mind. Wordsworth continues explaining that his soul was linked to Nature and her works through the wonder of spring. The image of the human soul running through him brings an apparent depth to the poem, turning the theme from spring to a more intimate perspective of man. â€Å"And much it grieved my heart to think/ what man has made of man.† The lines question a topic that most people will never fathom in their lifetimes. He describes his grieving over the topic of man’s world. To grieve, as defined by Dictionary.com, means â€Å"to be in pain of mind on account of an evil.† This definition describes exactly how Wordsworth feels about the evil that mankind has made of his world. Lines 9 and 10 continue to depict the setting that the poet is contemplating. As the spring setting returns to mind, Wordsworth reflects on how the flower appreciates the air it breaths and the birds hop and play with pleasure. The pictures show the simplicity of Nature and her animals, but also the joy they display. He spoke of a â€Å"thrill of pleasure,† which not only uses the flow of the word â€Å"pleasure† to illustrate the purity and joy of nature, but the â€Å"thrill of† affects the reader to think not of simple joy, but of the rush and the unadulterated enjoyment of this pleasure. His longing for this type of passion and thrill connects himself to nature by paradoxically  displaying the difference between man and nature. The detail with which Wordsworth writes about â€Å"budding twigs† spreading out to â€Å"catch the air† creates an aura of lust for the appreciation of the simple things in life. Leonard Skynard wrote a song called â€Å"Simple Man† which asks for a man to keep his life simple and realize that he is merely an object of God and he must remember to appreciate everything. The song and the poem are close in connection, with the same major theme of appreciation of the simple things. Wordsworth believes that this pleasure is sent from heaven and is part of Nature’s holy plan. He realizes that God is behind all things, large and small and man so often forgets to recognize the value of the air he breathes in and then flowers he picks. Speaking of â€Å"Nature’s holy plan,† I think he trust that Nature and God are one and their plans for man are the same, but they will only work if man realizes the right path to follow. The last two lines leave us with the question â€Å"Have I not reason to lament/ what man has made of man?† Wordsworth wants his reader to realize that we should all grieve for the sorrow that we cause ourselves. Man has made himself what he is today, a busy, selfish, evil person, an outcome for which we should grieve. The question leaves the reader to ponder the meaning of life and all the deep questions that are buried deep within the human soul, the questions unanswerable by words, yet only through actions.

Science vs arts Essay

I consider that Science and Arts are strongly bonded as, though they are two totally opposite areas of knowing, they manage to create a balance that holds tightly the emotions and the reasoning of human mankind. Art is the expression of human creativity, of human skill and imagination. It is usually represented through paintings, music, sculpture etc. Art is created to be appreciated or criticized. The Art creates beauty, and it gives the audience the opportunity to choose whether the beauty is indeed gorgeous or hideous. I think that the beauty of a work of art is not measurable. For me, beauty represents the ability to convey strong emotions and powerful feelings through the actual displayed work of art. For me, an inspirational painting like an old American Apache that rides his horse into the sunset is much more beautiful than a portrait of a beautiful girl. But tastes cannot be discussed, as there is no standard of taste among human beings. This is why art is so controversial. Science is the intellectual and practical activity encompassing the systematic study of the structure and behavior of the physical and natural world through observation and experiments. Science is the area of knowing that explains every phenomenon so people would understand it. It needs precision and accuracy in data collecting as Science is all about exact measurements. Science helps the world develop thoroughly as it is the only way we can know the truth. A thorough evolution is an evolution that comes as closely as possible to reality. On one hand, I think one completes each other as Art is the perfection of emotion and Science is the art of numbers. Taking into consideration the fact that the world has evolved through science, it can be said that Art has changed because of Science. But art itself is a science that needs exact measurements and accurate calculus. Work is recognized as a work of art through reasoning the feelings and the emotions one gets while observing the piece of art. Observing, as said in the definition of Science, is an action done in order to get the closest answer to reality. Reality is given by  Science, which means that, basically, Art is Science. On the other hand, it can be said that Science is an Art too, as the biggest discoveries were made by passionate scientist that wanted to prove the world that the things known so far were wrong. This means that they were put into a situation in which they, through imagination, reasoning and emotion, realized they were given false or erroneous information. Probably, their frustration and their ambition showed the world that through creative thinking and imaginative reasoning things that are unknown to mankind could be explained. It is extremely difficult to have a concept of knowledge upon a thing that does not exist. This inquires imagination and creativity, two vital features that create art. In conclusion, Science and Arts share mutual importance to humankind, tough they study totally different subjects. Their huge discrepancy is the one that makes them complement each other, thus, forming a couple without which the world could not exist.

Solving The Student Debt Crisis Essay - 1609 Words

The student debt crisis has reached an all time high with debt reaching a total of 1.3 trillion dollars across the United States.With tuition cost increasing,lack of scholarships and an increase of government loans,student debt will continue to increase.The enormous amount of debt put upon each student creates the inability of those students to help the economy grow.Our economy as we know it is in shambles and decreasing the student debt significantly will help the economy grow.Instead of debt owers putting that money towards the government where it won t be used to help decrease the student debt as we can see by the total debt, it should go to the community. Money going to places such as purchasing homes,cars,consumer goods will help improve the economy.To help alleviate the immense amount of student debt lenders should be required to forgive student loans in cases where students are unable to repay their debts,decrease cost of attendance,and increase scholarship opportunities fr om universities and implement more merit based sholarships.Doing so would benefit the growth of the economy by increasing the job market,housing market and would help businesses grow. Pineda 2 Students on average have more than 25000 dollars in student loan debt they have to pay back.Due to the incredible amount of debt certain issues arise ofShow MoreRelatedThe National Student Loan Debt1571 Words   |  7 Pagesadded to the national student loan debt. According to the Consumer Financial Protection Bureau, college debt now ranks second in the greatest debt owed besides a home mortgage. Unfortunately, the affordability of obtaining a post-secondary education no longer exists. Americans are now faced with over $ 1 trillion dollars in student debt. With such a huge escalation in college debt, we are facing a generation where over 50% of graduates will owe debt (McDaniel). While having debt after graduation isRead MoreBudget Cuts780 Words   |  4 PagesIllinois State government. The schools are being forced to make budget cuts. The teachers at the schools are being forced to take furlough days, which are day they have take off with out a pay. The cause of all of these actions is due to the major debt the State of Illinois is in. The money the state should be paying the universities, the state is using it on other items. University of Illinois is one of the schools that has to take budget cuts. This is unfair to the University of Illinois becauseRead MoreMiddle And Working Class Family s Depend On Student Loans Essay1546 Words   |  7 Pages Initial Draft Student Loan Debts Terri Gray Chamberlain college of Nursing â€Æ' Prewriting Assignment What is your narrowed topic? Middle and working class family’s depend on student loans. Loans are the only way to an education for many families not only here in the USA. Also I find it interesting that most minority families do not understand the cost of education. Student loans are aver political issue and many polices and laws have been put in place for people to have access to education yetRead MoreA Modern Day Setback That Affects The Majority Of Americans1623 Words   |  7 Pagesschool student thinking about your future and college. In this situation, you are the student who gets excellent grades and works hard but isn’t financially stable. You, like lots of others, have dreamed of pursuing your education at the schools you have been accepted to but, you have come to the conclusion that it’s not possible for you to attend those schools because of your financial situation. Thus, you’re forced to attend a community college or take out loans that will leave you in debt for aRead MoreFinding Work After College Essay924 Words   |  4 Pagesfield that is unrelated to their degree. This could be due to how many people are also trying to apply for jobs in that specific field, or it could be that that job does not provide them with enough money to live off. The most important thing that students really need to ask themselves before they attend college is, â€Å"is a college degree really enough in today’s world to get a good career and a well-paying job?† The last thing that a college graduate expects is to be working at McDonalds and livingRead MoreMOOCS and the Future of Education Essay502 Words   |  3 Pagestechnology is advancing around all of us. Computers are now accessible everywhere you go, cell phones in everyone’s hands, and even wireless internet in business we go to everyday. It doesn’t seem too farfetched now, just like online courses for college students who wish to attend without leaving the comfort of their own home for the price of internet and perhaps a book. As crazy as it sounds, it is completely true and it is becoming a huge hit. Massive Open Online Courses, MOOCS, are a popular up and comingRead MoreNew College Compact Or College For All Act?1555 Words   |  7 PagesParty presidential primaries and caucuses are a series of ongoing heated battles between Hillary Clinton and Bernie Sanders. One of the most prominent topic is the issue of student debt. According to the Federal Reserve Bank of New York, student loans have quadrupled since 2004, to $1.2 trillion (Brown). This insurmountable debt is an astronomical problem for Americans today and more so, for future Americans. College tuition has been rising for the past 40 years and will continue to do so exponentiallyRead MoreThe Teachers Of Detroit s Public1502 Words   |  7 PagesHow the can teachers expect their sickout to remedy cut pay and benefits, district debt, and dilapidated schools. The mass amount of teachers claiming to be sick has caused the schools to temporally shut down and this isn’t some snow day (G. B., B. B., D. S, 2016). Forcing these schools to shut down has greatly effected the students. Teachers need to accept the fact that their actions are harming their students and not helping. â€Å"COUGH† â€Å"COUGH† Read MoreStudent Loan Debt Has Become A National Problem With No Solution2311 Words   |  10 PagesIntroduction: According to CNN, â€Å"Almost 19% of student loan borrowers owe more than $50,000.Only 6% of borrowers had that much in 2001.† (Gillispe, 1). Why has student loan debt increased so much? Student Loan debt has become a national problem with no solution. Many students are borrowing more money to keep up with the rising cost of tuition in universities, leaving themselves with thousands of debt after graduation. Students after gaining this debt, have to find jobs to support it which can comeRead MoreObama s New Executive Action1250 Words   |  5 Pagesaffirm that they have been here for that many years ? There are too many technicalities and the fact that you re only doing this to make the republicans angry ( because whatever Democrats come up with Republicans disagree with, like the budget crisis ) will lacerate the U.S.A, not you. II. Reason #1 and Evidence First and foremost, Obama should have gone through Congress , the natural way. The natural way for a law to become a bill is to go through the house and then the Senate and then the