INTRODUCTION. Introduction. Dear HEDNA Members,

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1 2015 ANNUAL REPORT

2 Introduction INTRODUCTION Dear HEDNA Members, It gives me great pleasure to present you with our second annual report, highlighting HEDNA activity in The association continues to thrive, and we are delighted with the proactive direction it has taken. With increased mergers and acquisitions in the hospitality sector, it is imperative for HEDNA to remain abreast of the state of the industry and its main players. Like most trade associations, our financial position is driven by membership revenue. With continued consolidation affecting the status of both Principal (hotel) members and Allied members, the Board must undertake measures to protect its membership income. I encourage you all to embrace the many initiatives we have embarked upon and to contribute your voice and expertise. As I am known to remark, an association is defined by the actions of its members above those of its Board. We usher in our 25th anniversary with an exciting new brand identity. Our marketing committee introduced a new logo, web site and collateral at the close of 2015, and we will continue to build on this momentum throughout the coming year. Rajesh Vohra, HEDNA President

3 Financials FINANCIALS In 2010, HEDNA s reserves fell to an all-time low due to economic crises and world events. Ever since, it has been a priority of HEDNA s Board of Directors and management team to maintain a strategic focus on the financial stability of the organization. At the close of 2015, we are poised to achieve the highest revenue year since 2008 while simultaneously contributing to the association s strategic reserve fund. Currently, our reserve is precisely on target at 50% of the operating expense budget. Achieving our reserve goal has allowed us to re-invest funds into the organization. We have invested in HEDNA s future by supporting communications and marketing initiatives, membership development, education, international outreach, enhanced meeting events and programs, and more. Through the invaluable support of HEDNA membership, the Board has approved an expense budget of over US$1 million for At the same time, the association has been able to avoid substantial increases in dues, meeting registration fees and the cost of its educational programming through continued diligence in the area of expense management HEDNA 2015 Revenue HEDNA 2016 Budgeted Revenue 5% 4% 20% 21% 0% 0% 45% 46% 30% 29% Winter Meeting Revenue Spring Meeting Revenue Membership Revenue Other Program Revenue

4 Financials HEDNA 2015 Expenses HEDNA 2016 Budgeted Expenses 8% 9% 18% 24% 49% 50% 25% 17% Winter Meeting Expenses Spring Meeting Expenses Administrative Expenses Other Expenses HEDNA REVENUE VS. EXPENSES $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $ Revenue Expenses HEDNA RESERVES $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $

5 Conferences CONFERENCES Attendance at HEDNA s annual conferences continues to grow steadily year over year. Our 2015 Winter meeting in the United States saw an increase in attendance of 24% over 2014 and our Spring meeting in Europe saw an increase of 20%. Sponsorship revenue for the Winter meeting increased by 53% over 2014, while the Spring meeting saw a decline of 28%. The result was a 5% increase in sponsorship revenue overall. Advance registrations for the 2016 Winter meeting in Miami indicate another year of increased attendance and sponsorship. U.S. Meeting Registrations Los Angeles New Orleans Las Vegas Las Vegas CITY/YEAR Europe Meeting Registrations Barcelona Brussels Edinburgh Madrid Prague CITY/YEAR U.S. Meeting Sponsorship Income Los Angeles 2015 $72,700 New Orleans 2014 $47,487 Las Vegas 2012 $23,902 Las Vegas 2011 $18,937 CITY/YEAR $10 $20k $30k $40k $50k $60k $70k Europe Meeting Sponsorship Income Barcelona 2015 $49,250 Brussels 2014 $68,750 Edinburgh 2013 $40,125 Madrid 2012 $20,192 Prague 2011 $24,250 CITY/YEAR $10 $20k $30k $40k $50k $60k $70k

6 Working Groups & Committees WORKING GROUPS & COMMITTEES Membership Committee In 2015, the Membership Committee was tasked with analyzing the association s mix of Principal, Allied, Fellowship and Consultant members. The intent was to foster a well-balanced membership base to reflect the ever-evolving distribution environment of the hospitality industry. As a result, the committee has drawn in incremental, high-profile members that have begun to contribute to the success of HEDNA s strategic initiatives. Education Committee HEDNA saw many advances in its education program, HEDNA University, in In conjunction with ecornell, the Education Committee completed the development of an online version of the popular HEDNA U 1.0 course in January. The group also engaged HER Consulting to assist in the development of a six-module HEDNA U 2.0 course and conducted the first class in June. The HEDNA U 1.0 Corporate Training program was introduced in August. Finally, in support of the China Working Group, the committee engaged a service to translate the online HEDNA U 1.0 course into Mandarin by early Marketing Committee In 2015, a committee from within the board was tasked with raising the profile of the association by improving its communications outreach. To this end, a branding consultant was engaged to complete a strategic analysis. To increase HEDNA s relevancy, promote engagement and cultivate growth in membership, the association s vision and core messaging were redefined and its brand identity was repositioned to establish momentum, vitality and an appropriately modern presence. Under the direction of a graphic design firm, the brand enhancement encompassed the reinvention of the logo and all communications vehicles including member collateral, conference materials, the web site and other e-marketing channels. The roll-out of the new graphic identity began with communications for the Winter conference and will be completed in early 2016 in celebration of HEDNA s 25th anniversary. The committee will continue to reinforce HEDNA s brand promise by focusing on the association s value proposition in Payments Forum In addition to hosting industry thought leaders at both annual conferences, the Payments Forum and its associated working groups focused on three key areas in 2015: virtual payment cards, chip cards and global payments. In collaboration with Hotel Technology Next Generation (HTNG), the joint publication, Virtual Payment Cards: A Handbook for Hoteliers, was developed along with specifications for virtual payment cards. Available at hedna.org, the specifications for hotel booking and payment systems are an important step towards a much needed industry standard.

7 Working Groups & Committees WORKING GROUPS & COMMITTEES Continued In May, the group hosted a webinar with Visa to educate members on chip technology and the shift in on-property counterfeit fraud liability. It published the webinar as well as the EMV Technology Quick Reference Guide for Hoteliers at hedna.org. Finally, the group launched a Global Hospitality Payments Working Group to outline options, designs and best practices for the entire stream of payment processing for the hotel industry. This ambitious project will cover topics such as consumer-based, B2B, cross-border and multi-currency payments, corporate and agency bookings, and hotel commissions. The group will convene for the first time at the 2016 Winter conference. Metasearch Working Group The mission of the Metasearch Working Group is to inspire and equip the industry with the knowledge needed to effectively participate in the global metasearch landscape. In 2015, the group held highly attended workshops prior to both HEDNA conferences. In August, the group published a white paper to help hotels navigate the complexities of metasearch. HEAVY META: How to Optimize Your Presence on Metasearch is available at hedna.org. Mobile Working Group The newest collaboration at HEDNA, the Mobile Working Group was formed to address the growing impact of mobile technology in the hospitality industry. Its mission is to foster an educational environment in which members can discover new ways to harness mobile in their distribution strategies. In 2016, the group will explore particular challenges within the mobile space and publish a white paper based on its conclusions Switchover Working Group The Switchover Working Group is committed to increasing clarity in the switchover process. The group redefined the guidelines and process for notifying the GDSs and DHISCO to changes in representation and branding. The results have been adopted by the industry. The Property Switchover Guidelines and a sample letter are available at hedna.org. China Working Group In 2015, the primary focus of the China Working Group was to expand HEDNA s presence in China by recruiting domestic hotel chains and local allied members. In May, the group convened for the first time in Shanghai followed by a successful networking event which resulted in increased membership. For 2016, the group will focus on payment challenges and opportunities in China, and it will introduce a Mandarin version of HEDNA U online to increase interest within the region. Head of Programs Since March 2015, HEDNA s new Head of Programs has worked with the Board, various committees and working groups, and staff at Kellen Company to advance the association s goals. Two key areas included fine-tuning the balance between principal and allied membership and expanding HEDNA s presence in other markets, especially China. In 2016, the focus of the Head of Programs will be on conference programming and the execution of a targeted plan to increase the association s presence in Latin and South America.

8 Looking Ahead LOOKING AHEAD As we head into our 25th year, we are excited by the increased participation we are seeing in our conferences and educational programs, as well as in our committees and working groups. We hope you will consider participating in areas related to your interests and expertise. At the same time, the Board welcomes suggestions regarding topics and issues the association should consider or actively pursue. Please feel free to reach out to any of HEDNA s Board members or staff with your thoughts and ideas.

9 2015 Board & Staff 2015 BOARD & STAFF PRESIDENT Rajesh Vohra Sales & Marketing Director, Sarova Hotels VICE PRESIDENT Doug Carr Executive Director Distribution, FRHI Hotels & Resorts SECRETARY Cynthia Castillo Head of Hotel Program & Customer Relationship, Global Hotel Group, Amadeus TREASURER Pam Woodman Director edistribution Services, Marriott International STAFF Reed Hitchcock Executive Director Ann Crampton Associate Director Erin Graziani Member Services BOARD MEMBERS AT LARGE David Cabreza Director, International Distribution Services, Hilton Worldwide Mike Carlo Head of Travel Solutions, WEX Inc Sarah Fults Director, Third Party Distribution, Choice Hotels Jodie Gibson Senior Director, Connectivity, Wyndham Hotel Group Sandra Langley Vice President, Distribution, InterContinental Hotels Group Sebastien Leitner Director Distribution Accounts, Expedia Edward Perry Head of Distribution Partnerships, Americas, HRS Group David Revelle Senior Director of Global Partnerships, DerbySoft Dee Thomas Vice President, Product Management, Supplier Solutions, Lanyon Sylvie Hachey Head of Programs Steve Gigantiello Director of Meetings & Expositions

10 ADMINISTRATIVE OFFICES HEDNA Headquarters National Press Building, Suite 750, th St, NW Washington, DC T: F: HEDNA Europe Office Avenue Jules Bordet 142, 1140 Brussels T: HEDNA APAC Office 11F/1177, Block A, Gateway Plaza, No18 Xiaguangli North Road, East 3rd Ring, Chaoyang District, Beijing, T: info@hedna.org 2015 ANNUAL REPORT