Hilton says tax cut would finance share buybacks -

Hilton says tax cut would finance share buybacks

Credit: channelnewsasia.com

  • Dec 08 2017 00:40About: 9 days ago
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NEW YORK: Hilton Worldwide Holdings Inc would use the windfall from a lower U.S. corporate tax rate to finance share buybacks from investors, company executives said, highlighting how corporate savings would be spent under the Republican tax plan.

"What we'll do with it is what we have been doing with our money, which is capital returns. We will continue to accelerate the pace of our capital returns," Christian Charnaux, Hilton's senior vice president of corporate finance, said.

Hilton Chief Executive Chris Nassetta said that increased spending from share buybacks would still make its way down to workers as investors used the money to buy more properties.

Nassetta had previously said on the company's third-quarter earnings call he expected the hotel industry to use savings to hire more people and invest more in real estate and equipment.

In November, Hilton increased its stock repurchase authorization by US$1 billion. The total amount of common stock currently authorized for repurchase is about US$1.3 billion.

Hilton is one of many corporations that have expressed support for Republican proposals to slash the corporate tax rate. Under the narrowly approved Senate tax bill, the corporate tax rate would be permanently cut to 20 percent from 35 percent.

Additional cash flow from changes to the tax rate would add bounce to what has already been a successful year for the hotel operator.

In its third-quarter earnings, for the third time this year the company raised its full-year profit forecast after beating analyst expectations in key financial metrics for the period.

(Reporting by Alana Wise; Editing by James Dalgleish)



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