ton Hotel strategy is to concentrate corporate resources on only the most profitable properties (Moskowitz, Katz, and Levering, 1985, p. 719). Company strategy, thus, is to own and operate properties only in the dominant markets. The services offered by the Hilton Hotels include the traditional lodging services associated with hotel organizations--rooms, food and beverage service, and ancillary services for guests. Additionally, however, the company provides a full range of business support services for business and professional guests, complete convention facilities and services for convention- related guests, and complete travel and sight-seeing services for vacationing guests. The company's hotel-casino property also provide gaming services.
Hilton Hotels revenues have increased each year over the past decade (Sharav, 1994, p. 1777). Revenues for all of 1994 are projected at $1.4 billion, while $1.49 billion in revenues are projected for 1995. Operating margins at Hilton Hotels have remained stable in the 21 percent range over the past five years. Net profit margins averaged somewhat in excess of eight-percent over the 1991-1993 period, with a projected net profit margin of 8.2 percent for all of 1994, and a projected net profit margin of 9.4 percent in 1995. Net profits have increased each year since 1991; however, the $115 million profit projected for all of 1994 will mark the first time the $112 million level has been exceeded since 1990, while the $140 million profit projected for 1995 will eclipse the company's current all time high net profit of $130.9 million attained in 1988.
During the 1991-1993 period, Hilton Hotels earned an average of 6.5 percent on total capital, and 9.3 percent on net worth (Sharav, 1994, p. 1777). For all of 1994, the comparable projections are seven-percent on total capital, and 10.5 percent on net worth, while the 1995 projections are eight-percent on total capital, and 11.5 percent on...