TYSONS, Va.,
“I am incredibly pleased with our preliminary fourth quarter and year-end results, with both preliminary Comparable RevPAR and Adjusted EBITDA exceeding the midpoint of our previously announced 2023 guidance ranges. Our portfolio continued to deliver impressive results, as business travel accelerated in
Operational Highlights
Based upon an initial review of preliminary operating and financial results, the Company has provided preliminary fourth quarter and full-year 2023 results as follows:
(unaudited, amounts in millions, except for RevPAR, ADR, Total RevPAR, and per share data) | |||||||||||||
Preliminary | |||||||||||||
Q4 2023 | Change vs. 2022(1) | Full -Year 2023 | Change vs. 2022(1) | ||||||||||
Comparable RevPAR | $ | 178.25 | 4.1 | % | $ | 178.62 | 8.7 | % | |||||
Comparable Occupancy | 71.0 | % | 1.5 | % pts | 72.7 | % | 4.9 | % pts | |||||
Comparable ADR | $ | 250.93 | 1.9 | % | $ | 245.80 | 1.3 | % | |||||
Comparable Total RevPAR | $ | 287.21 | 4.9 | % | $ | 285.50 | 10.2 | % | |||||
Net income | $ | 189 | 440.0 | % | $ | 107 | (38.2 | )% | |||||
Net income attributable to stockholders | $ | 188 | 452.9 | % | $ | 98 | (39.5 | )% | |||||
Operating income | $ | 276 | 230.2 | % | $ | 343 | 16.3 | % | |||||
Operating income margin | 42.1 | % | 2,950 | bps | 12.7 | % | 90 | bps | |||||
$ | 171 | 2.3 | % | $ | 680 | 9.2 | % | ||||||
27.6 | % | (70 | ) bps | 27.9 | % | (30 | ) bps | ||||||
Adjusted EBITDA | $ | 163 | 2.5 | % | $ | 659 | 8.7 | % | |||||
Adjusted FFO attributable to stockholders | $ | 111 | 9.9 | % | $ | 440 | 25.0 | % | |||||
Earnings per share - Diluted(1) | $ | 0.89 | 493.3 | % | $ | 0.45 | (36.6 | )% | |||||
Adjusted FFO per share – Diluted(1) | $ | 0.53 | 17.8 | % | $ | 2.05 | 33.1 | % | |||||
Weighted average shares outstanding – Diluted | 210 | (14 | ) | 215 | (13 | ) |
_________________________
(1) Amounts are calculated based on unrounded numbers.
(2) For both the three months and year ended
(unaudited, dollars in millions, except for RevPAR and per share data) | |||||||||||
Metric | Preliminary Full-Year 2023 | Full-Year 2023 Outlook | |||||||||
Results as of | as of | Variance(1) | |||||||||
Comparable RevPAR | $ | 179 | $ | 178 | $ | 1 | |||||
Comparable RevPAR change vs. 2022 | 8.7 | % | 8.2 | % | 0.5 | % | |||||
Adjusted EBITDA | $ | 659 | $ | 656 | $ | 3 | |||||
27.9 | % | 28.0 | % | (10 | ) bps | ||||||
(30 | ) bps | (20 | ) bps | (10 | ) bps | ||||||
Adjusted FFO per share – Diluted(2) | $ | 2.05 | $ | 1.97 | 4.1 | % |
_________________________
(1) Presented at the estimated midpoint.
(2) Amounts are calculated based on unrounded numbers.
Preliminary Estimated Financial Results
Park is presenting certain estimated financial and operating results (and, in certain cases, estimated ranges) for the fourth quarter and full-year 2023, based upon the information available as of the date of this press release. Park's actual results may differ materially from these preliminary estimated results or ranges. These estimates are preliminary and are inherently uncertain and subject to change as Park completes the preparation of its consolidated financial statements and related notes and completion of its financial close procedures for the year ended
Earnings Release and Conference Call
Park will report its finalized Fourth Quarter and Full-Year 2023 financial results after the stock market closes on
A replay of the webcast will be available within 24 hours after the live event on the Investors section of Park’s website.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (“Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (“Exchange Act”). Forward-looking statements include, but are not limited to, statements related to the impact of Park's decision to cease payments on its
All such forward-looking statements are based on current expectations of management and therefore involve estimates and assumptions that are subject to risks, uncertainties and other factors that could cause actual results to differ materially from the results expressed in these forward-looking statements. You should not put undue reliance on any forward-looking statements and we urge investors to carefully review the disclosures Park makes concerning risks and uncertainties in Item 1A: “Risk Factors” in Park's Annual Report on Form 10-K for the year ended
Non-GAAP Financial Measures
Park presents certain non-GAAP financial measures in this press release, including Nareit FFO attributable to stockholders, Adjusted FFO attributable to stockholders, EBITDA, Adjusted EBITDA,
About
Park is one of the largest publicly traded lodging REITs with a diverse portfolio of market-leading hotels and resorts with significant underlying real estate value. Park’s portfolio currently consists of 43 premium-branded hotels and resorts with over 26,000 rooms primarily located in prime city center and resort locations. Visit www.pkhotelsandresorts.com for more information.
NON-GAAP FINANCIAL MEASURES RECONCILIATIONS PRELIMINARY EBITDA AND ADJUSTED EBITDA | |||||||
(unaudited, dollars in millions) | Preliminary | ||||||
Three Months Ended | Year Ended | ||||||
Operating income | $ | 276 | $ | 343 | |||
Interest income | 9 | 38 | |||||
Interest expense | (52 | ) | (207 | ) | |||
Interest expense on the SF Mortgage Loan | (14 | ) | (45 | ) | |||
Equity in earnings from investments in affiliates | 2 | 11 | |||||
Other gain, net | 1 | 5 | |||||
Income tax expense(1) | (33 | ) | (38 | ) | |||
Net income | 189 | 107 | |||||
Depreciation and amortization expense | 94 | 287 | |||||
Interest income | (9 | ) | (38 | ) | |||
Interest expense | 52 | 207 | |||||
Interest expense on the SF Mortgage Loan | 14 | 45 | |||||
Income tax expense(1) | 33 | 38 | |||||
Interest expense, income tax and depreciation and amortization included in equity in earnings from investments in affiliates | 1 | 8 | |||||
EBITDA | 374 | 654 | |||||
Gain on sales of assets, net | — | (15 | ) | ||||
Gain on derecognition of assets(2) | (221 | ) | (221 | ) | |||
Gain on sale of investments in affiliates | — | (3 | ) | ||||
Share-based compensation expense | 4 | 18 | |||||
Impairment and casualty loss | — | 204 | |||||
Other items | 6 | 22 | |||||
Adjusted EBITDA | $ | 163 | $ | 659 |
_____________________________________
(1) Represents the midpoint of an estimated range of
(2) For the three months and year ended
NON-GAAP FINANCIAL MEASURES RECONCILIATIONS PRELIMINARY COMPARABLE HOTEL ADJUSTED EBITDA AND COMPARABLE HOTEL ADJUSTED EBITDA MARGIN | |||||||
(unaudited, dollars in millions) | Preliminary | ||||||
Three Months Ended | Year Ended | ||||||
Adjusted EBITDA | $ | 163 | $ | 659 | |||
Less: Adjusted EBITDA from investments in affiliates | (5 | ) | (24 | ) | |||
Add: All other(1) | 12 | 52 | |||||
170 | 687 | ||||||
Less: Adjusted EBITDA from hotels disposed of | — | (3 | ) | ||||
Less: Adjusted EBITDA from the | 1 | (4 | ) | ||||
$ | 171 | $ | 680 |
Preliminary | |||||||
Three Months Ended | Year Ended | ||||||
Total Revenues | $ | 657 | $ | 2,698 | |||
Less: Other revenue | (21 | ) | (85 | ) | |||
Less: Revenues from hotels disposed of | — | (10 | ) | ||||
Less: Revenue from the | (17 | ) | (162 | ) | |||
$ | 619 | $ | 2,441 |
Preliminary | |||||||
Three Months Ended | Year Ended | ||||||
Total Revenues | $ | 657 | $ | 2,698 | |||
Operating income | $ | 276 | $ | 343 | |||
Operating income margin(2) | 42.1 | % | 12.7 | % | |||
Preliminary | |||||||
Three Months Ended | Year Ended | ||||||
$ | 619 | $ | 2,441 | ||||
$ | 171 | $ | 680 | ||||
27.6 | % | 27.9 | % |
_________________________
(1) Includes revenues and expenses related to support service arrangements with Hilton Grand Vacations and non-income taxes on TRS leases.
(2) Percentages are calculated based on unrounded numbers.
NON-GAAP FINANCIAL MEASURES RECONCILIATIONS PRELIMINARY NAREIT FFO AND ADJUSTED FFO | |||||||
(unaudited, in millions, except per share data) | Preliminary | ||||||
Three Months Ended | Year Ended | ||||||
Net income attributable to stockholders | $ | 188 | $ | 98 | |||
Depreciation and amortization expense | 94 | 287 | |||||
Depreciation and amortization expense attributable to noncontrolling interests | (1 | ) | (4 | ) | |||
Gain on sales of assets, net | — | (15 | ) | ||||
Gain on derecognition of assets(1) | (221 | ) | (221 | ) | |||
Gain on sale of investments in affiliates | — | (3 | ) | ||||
Impairment loss | — | 202 | |||||
Equity investment adjustments: | |||||||
Equity in earnings from investments in affiliates | (2 | ) | (11 | ) | |||
Pro rata FFO of investments in affiliates | 2 | 14 | |||||
Nareit FFO attributable to stockholders | 60 | 347 | |||||
Casualty loss | — | 2 | |||||
Share-based compensation expense | 4 | 18 | |||||
Incremental interest expense on the SF Mortgage Loan(2) | 12 | 20 | |||||
Other items(3) | 35 | 53 | |||||
Adjusted FFO attributable to stockholders | $ | 111 | $ | 440 | |||
Nareit FFO per share – Diluted(4) | $ | 0.29 | $ | 1.62 | |||
Adjusted FFO per share – Diluted(4) | $ | 0.53 | $ | 2.05 | |||
Weighted average shares outstanding – Diluted | 210 | 215 |
______________________________
(1) For the three months and year ended
(2) Represents incremental interest expense associated with the default of the SF Mortgage Loan.
(3) Includes estimated tax expense at the midpoint of
(4) Per share amounts are calculated based on unrounded numbers.
DEFINITIONS
Comparable
The Company presents certain data for its consolidated hotels on a Comparable basis as supplemental information for investors:
EBITDA, Adjusted EBITDA,
Earnings before interest expense, taxes and depreciation and amortization (“EBITDA”), presented herein, reflects net income excluding depreciation and amortization, interest income, interest expense, income taxes and interest expense, income tax and depreciation and amortization included in equity in earnings from investments in affiliates.
Adjusted EBITDA, presented herein, is calculated as EBITDA, as previously defined, further adjusted to exclude the following items that are not reflective of Park's ongoing operating performance or incurred in the normal course of business, and thus, excluded from management's analysis in making day-to-day operating decisions and evaluations of Park's operating performance against other companies within its industry:
- Gains or losses on sales of assets for both consolidated and unconsolidated investments;
- Costs associated with hotel acquisitions or dispositions expensed during the period;
- Severance expense;
- Share-based compensation expense;
- Impairment losses and casualty gains or losses; and
- Other items that management believes are not representative of the Company’s current or future operating performance.
EBITDA, Adjusted EBITDA,
The Company believes that EBITDA, Adjusted EBITDA,
EBITDA, Adjusted EBITDA,
Nareit FFO attributable to stockholders, Adjusted FFO attributable to stockholders, Nareit FFO per share – diluted and Adjusted FFO per share – diluted
Nareit FFO attributable to stockholders and Nareit FFO per diluted share (defined as set forth below) are presented herein as non-GAAP measures of the Company’s performance. The Company calculates funds from (used in) operations (“FFO”) attributable to stockholders for a given operating period in accordance with standards established by the
The Company also presents Adjusted FFO attributable to stockholders and Adjusted FFO per diluted share when evaluating its performance because management believes that the exclusion of certain additional items described below provides useful supplemental information to investors regarding the Company’s ongoing operating performance. Management historically has made the adjustments detailed below in evaluating its performance and in its annual budget process. Management believes that the presentation of Adjusted FFO provides useful supplemental information that is beneficial to an investor’s complete understanding of operating performance. The Company adjusts Nareit FFO attributable to stockholders for the following items, which may occur in any period, and refers to this measure as Adjusted FFO attributable to stockholders:
- Costs associated with hotel acquisitions or dispositions expensed during the period;
- Severance expense;
- Share-based compensation expense;
- Casualty gains or losses; and
- Other items that management believes are not representative of the Company’s current or future operating performance.
Occupancy
Occupancy represents the total number of room nights sold divided by the total number of room nights available at a hotel or group of hotels. Occupancy measures the utilization of the Company’s hotels’ available capacity. Management uses occupancy to gauge demand at a specific hotel or group of hotels in a given period. Occupancy levels also help management determine achievable Average Daily Rate (“ADR”) levels as demand for rooms increases or decreases.
Average Daily Rate
ADR (or rate) represents rooms revenue divided by total number of room nights sold in a given period. ADR measures average room price attained by a hotel and ADR trends provide useful information concerning the pricing environment and the nature of the customer base of a hotel or group of hotels. ADR is a commonly used performance measure in the hotel industry, and management uses ADR to assess pricing levels that the Company is able to generate by type of customer, as changes in rates have a more pronounced effect on overall revenues and incremental profitability than changes in occupancy, as described above.
Revenue per
Revenue per
Total RevPAR
Total RevPAR represents rooms, food and beverage and other hotel revenues divided by the total number of room nights available to guests for a given period. Management considers Total RevPAR to be a meaningful indicator of the Company’s performance as approximately one-third of revenues are earned from food and beverage and other hotel revenues. Total RevPAR is also a useful indicator in measuring performance over comparable periods.
For more information, contact:
Senior Vice President, Corporate Strategy
571-302-5591
iweissman@pkhotelsandresorts.com
For additional information or to receive press releases via e-mail, please visit our website at
www.pkhotelsandresorts.com
Source:
2024 GlobeNewswire, Inc., source