Host Hotels & Resorts, Inc. (NASDAQ: HST) (the “Company”), the
nation’s largest lodging real estate investment trust (“REIT”),
today announced results for first quarter of 2024.
OPERATING RESULTS(unaudited, in
millions, except per share and hotel statistics)
|
|
Quarter ended March 31, |
|
|
|
|
|
2024 |
|
|
|
2023 |
|
|
Percent Change |
Revenues |
|
$ |
1,471 |
|
|
$ |
1,381 |
|
|
6.5 |
% |
Comparable hotel
revenues⁽¹⁾ |
|
|
1,398 |
|
|
|
1,375 |
|
|
1.7 |
% |
Comparable hotel Total
RevPAR⁽¹⁾ |
|
|
369.58 |
|
|
|
367.56 |
|
|
0.5 |
% |
Comparable hotel
RevPAR⁽¹⁾ |
|
|
215.37 |
|
|
|
218.08 |
|
|
(1.2 |
%) |
|
|
|
|
|
|
|
Net income |
|
$ |
272 |
|
|
$ |
291 |
|
|
(6.5 |
%) |
EBITDAre⁽¹⁾ |
|
|
504 |
|
|
|
444 |
|
|
13.5 |
% |
Adjusted EBITDAre⁽¹⁾ |
|
|
483 |
|
|
|
444 |
|
|
8.8 |
% |
|
|
|
|
|
|
|
Diluted earnings per common
share |
|
|
0.38 |
|
|
|
0.40 |
|
|
(5.0 |
%) |
NAREIT FFO per diluted
share⁽¹⁾ |
|
|
0.60 |
|
|
|
0.54 |
|
|
11.1 |
% |
Adjusted FFO per diluted
share⁽¹⁾ |
|
|
0.60 |
|
|
|
0.55 |
|
|
9.1 |
% |
- Additional detail
on the Company’s results, including data for 22 domestic markets,
is available in the First Quarter 2024 Supplemental Financial
Information on the Company’s website at www.hosthotels.com.
James F. Risoleo, President and Chief Executive
Officer, said, “Host delivered comparable hotel Total RevPAR growth
of 0.5% over the first quarter of 2023, which is impressive given
the challenging comparison of the prior year. Banquet revenues led
our performance, driven by improvements in group business and
continued strong demand in food and beverage. In addition, we
delivered net income of $272 million, a decline of 6.5% compared to
the first quarter of 2023, and Adjusted EBITDAre of $483 million,
an 8.8% improvement over the first quarter of 2023. At the same
time, comparable hotel RevPAR declined 1.2%, as a result of tough
comparisons, the impact of Maui, and unseasonable weather in many
markets that impacted short term leisure demand.”
Risoleo continued, “Subsequent to quarter end,
we acquired the 1 Hotel Nashville and Embassy Suites by Hilton
Nashville Downtown, underscoring the strength of our balance sheet
and our strategic approach to capital allocation. This two-hotel
complex further improves the quality of our portfolio and
establishes a meaningful presence for Host in a top performing
market. As a result of the acquisition, additional business
interruption insurance gains and improving out-of-room spend, we
kept our net income guidance flat to our previous forecast, while
increasing the mid-point of our Adjusted EBITDAre guidance by 2%.
We tightened our full year Total RevPAR growth guidance range to
2.7% to 4.6% and our RevPAR growth guidance range to 2.0% to 4.0%,
based on our performance in the first quarter, the evolving nature
of demand in Maui, and our expectations for growth in the second
half of the year. Given our fortress balance sheet and successful
capital allocation execution, we believe Host is well positioned to
continue delivering EBITDA growth.”
_______________________________(1) NAREIT Funds From Operations
(“FFO”) per diluted share, Adjusted FFO per diluted share,
EBITDAre, Adjusted EBITDAre and comparable hotel revenues are
non-GAAP (U.S. generally accepted accounting principles) financial
measures within the meaning of the rules of the Securities and
Exchange Commission (“SEC”). See the Notes to Financial Information
on why the Company believes these supplemental measures are useful,
reconciliations to the most directly comparable GAAP measure, and
the limitations on the use of these supplemental measures.
Additionally, comparable hotel results and statistics include
adjustments for dispositions, acquisitions and non-comparable
hotels. See Hotel Operating Data for RevPAR results of the
portfolio based on the Company's ownership period without these
adjustments.
HIGHLIGHTS:
- Comparable hotel
Total RevPAR was $369.58, representing an increase of 0.5% compared
to first quarter of 2023, as strong contributions from group
business led to an increase in food and beverage revenues, with
banquet and catering revenues per group room night in excess of the
prior peak reached in first quarter of 2023.
- Comparable hotel
RevPAR was $215.37 for the first quarter of 2024, representing a
decrease of 1.2% compared to first quarter of 2023, driven by the
impacts of the Maui wildfires, unseasonable weather conditions in
several markets, and unanticipated delays in renovation. In
addition, there were difficult comparisons to first quarter of
2023, which had experienced elevated levels of leisure demand
leading to significant RevPAR growth.
- GAAP net income was
$272 million for first quarter of 2024, reflecting a 6.5% decrease
compared to first quarter of 2023, primarily due to a decline in
gain on asset sales, partially offset by gains on insurance
settlements recognized in the first quarter. GAAP operating profit
margin was 19.8%, an improvement of 180 basis points compared to
the first quarter of 2023 due to the insurance gains.
- Comparable hotel
EBITDA was $435 million for first quarter of 2024, a 2.9% decrease
compared to first quarter of 2023, leading to a comparable hotel
EBITDA margin decline of 140 basis points to 31.2%. The decline for
the quarter was driven by increased wages and higher insurance
expenses in comparison to first quarter 2023.
- Adjusted EBITDAre
was $483 million for first quarter of 2024, exceeding 2023 by 8.8%,
driven by strong operating performance at The Ritz-Carlton, Naples,
which was closed in the first half of 2023 due to Hurricane Ian,
and including the benefit of the business interruption gain.
- To date, the
Company has received insurance proceeds of $263 million out of the
expected potential insurance recovery of approximately $310 million
for covered costs related to damage and disruption caused by
Hurricane Ian. The Company received $31 million in the first
quarter and $10 million of these proceeds were recognized as a
gain on business interruption.
Subsequent Acquisition
- On April 15, 2024,
the Company acquired the fee simple interest in the 215-room 1
Hotel Nashville and 506-room Embassy Suites by Hilton Nashville
Downtown for a total purchase price of $530 million. The LEED
Silver® hotels comprise a two-hotel complex located in Nashville's
famed Lower Broadway entertainment district across the street from
Music City Convention Center and near other key points of interest,
and feature seven food and beverage outlets, a spa, two fitness
centers, a yoga studio and 33,000 square feet of shared meeting
space.
Maui Update
- Impacts from the
August 2023 wildfires in Maui, Hawaii continued into 2024. In the
first quarter, the Company's Maui hotels and golf courses impacted
RevPAR by 170 basis points. Operating profit margin and comparable
hotel EBITDA margin were impacted by approximately 50 basis points
and 30 basis points, respectively, for the first quarter. The first
quarter impact is understated, as the Company would have expected
Maui to contribute 140 basis points to portfolio RevPAR growth in
the first quarter given the renovation disruption at Fairmont Kea
Lani in 2023. As a result, the total estimated impact of the
wildfires on first quarter RevPAR is 310 basis points.
BALANCE SHEET
The Company maintains a robust balance sheet and completed
several transactions in March and April of 2024. These transactions
include:
- Net draws of $215
million on the revolving credit facility (including a $300 million
draw in March, as well as a $65 million draw and $150 million
repayment subsequent to quarter end).
- The aforementioned
$530 million acquisition of the 1 Hotel Nashville and Embassy
Suites by Hilton Nashville Downtown.
- The repayment of
the $400 million 3⅞% Series G senior notes at maturity on April 1,
2024.
- The first quarter
dividend paid on common stock of $141 million in April 2024.
After adjusting for the above investing and financing activities
completed after quarter end, the Company estimates that it has the
following balances:
- Total assets of
$11.8 billion.
- Debt balance of
$4.0 billion, with a weighted average maturity of 4.3 years, a
weighted average interest rate of 4.7%, and a balanced maturity
schedule.
-
Total available liquidity of approximately $1.7 billion, including
furniture, fixtures and equipment escrow reserves of $231 million
and $1.3 billion available under the revolver portion of the credit
facility, and an estimated adjusted cash balance as follows (in
millions):
Cash and cash equivalents at March 31, 2024 |
|
$ |
1,349 |
|
Repayment of Series G senior
notes |
|
|
(400 |
) |
Net repayment on revolver
portion of credit facility, post quarter-end |
|
|
(85 |
) |
Cash consideration for the
acquisition of 1 Hotel and Embassy Suites Nashville |
|
|
(530 |
) |
First quarter dividend paid on
common stock |
|
|
(141 |
) |
Cash and cash equivalents
adjusted for subsequent transactions |
|
$ |
193 |
|
|
DIVIDENDS
The Company paid a first quarter common stock
cash dividend of $0.20 per share on April 15, 2024 to
stockholders of record on March 28, 2024. All future
dividends, including any special dividends, are subject to approval
by the Company’s Board of Directors.
HOTEL BUSINESS MIX UPDATE
The Company’s customers fall into three broad
groups: transient, group and contract business, which accounted for
approximately 61%, 35%, and 4%, respectively, of its full year 2023
room sales.
The following are the results for transient,
group and contract business in comparison to 2023 performance, for
the Company's current portfolio:
|
Quarter ended March 31, 2024 |
|
Transient |
|
Group |
|
Contract |
Room nights (in thousands) |
|
1,314 |
|
|
|
1,103 |
|
|
|
172 |
|
Percent change in room nights
vs. same period in 2023 |
|
(1.9 |
%) |
|
|
4.1 |
% |
|
|
7.5 |
% |
Rooms revenues (in
millions) |
$ |
456 |
|
|
$ |
324 |
|
|
$ |
35 |
|
Percent change in revenues vs.
same period in 2023 |
|
(4.7 |
%) |
|
|
5.3 |
% |
|
|
18.2 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL EXPENDITURES
The following presents the Company’s capital
expenditures spend through the first quarter of 2024 and the
forecast for full year 2024 (in millions):
|
Quarter ended March 31,
2024 |
|
2024 Full Year Forecast |
|
|
|
|
|
|
|
Actual |
|
Low-end of range |
|
High-end of range |
ROI - Marriott and Hyatt Transformational Capital Programs |
$ |
13 |
|
|
$ |
125 |
|
|
$ |
150 |
|
All other return on investment
("ROI") projects |
|
20 |
|
|
|
100 |
|
|
|
130 |
|
Total ROI Projects |
|
33 |
|
|
|
225 |
|
|
|
280 |
|
Renewals and Replacements
("R&R") |
|
58 |
|
|
|
250 |
|
|
|
300 |
|
R&R and ROI Capital
expenditures |
|
91 |
|
|
|
475 |
|
|
|
580 |
|
R&R - Insurable
Reconstruction |
|
12 |
|
|
|
25 |
|
|
|
25 |
|
Total Capital
Expenditures |
$ |
103 |
|
|
$ |
500 |
|
|
$ |
605 |
|
|
|
|
|
|
|
Inventory spend for condo
development(1) |
|
6 |
|
|
|
50 |
|
|
|
70 |
|
Total capital allocation |
$ |
109 |
|
|
$ |
550 |
|
|
$ |
675 |
|
__________(1)
Represents construction costs for the development of condominium
units on a land parcel adjacent to Four Seasons Resort Orlando at
Walt Disney World® Resort. Under U.S. GAAP, costs to develop units
for resale are considered an operating activity on the statement of
cash flows, and categorized as inventory. This spend is separate
from payments for capital expenditures, which are considered
investing activities.
Under the Hyatt Transformational Capital
Program, the Company received $2 million, of the expected full year
$9 million, of operating guarantees in the first quarter of 2024 to
offset business disruptions.
2024
OUTLOOK
The 2024 guidance range continues to contemplate
steady demand in travel and low supply growth. In addition, the
range incorporates continued improvement in group business, a
gradual recovery in business transient demand, softer short term
leisure transient demand, and the evolution of demand on Maui as
the island recovers from the recent wildfires. Growth in the first
half of 2024 is expected to be flat to low single-digits, while the
second half of the year is expected to have stronger year-over-year
improvements due to better group booking pace, less renovation
disruption compared to the second half of 2023 and diminishing
impacts from the wildfire event in Maui, which occurred in early
August of 2023.
Operating profit margin in 2024 is expected to
increase slightly compared to 2023, while comparable hotel EBITDA
margins are expected to decline compared to 2023, due to the
impacts from the Maui wildfires and continued growth in wages, real
estate taxes and insurance. At the midpoint of guidance, the impact
from the Maui wildfires is expected to be an approximate decline of
130 basis points in RevPAR, 90 basis points in Total RevPAR and 20
basis points in margins. At the midpoint, in comparison to 2019,
operating profit margin is expected to increase 110 basis points
and comparable hotel EBITDA margins are expected to increase 10
basis points, as portfolio-wide cost reductions continue to curb
inflation and benefiting from business interruption gains.
The guidance range for net income and Adjusted
EBITDAre includes an additional $28 million of gains from business
interruption proceeds compared to prior forecast comprised of $8
million related to Hurricane Ian and based on an estimated range of
$18 million to $22 million related to the Maui wildfires, which is
expected to be received during the remainder of 2024. The guidance
also includes an estimated $17 million and $29 million of net
income and Adjusted EBITDAre, respectively, which is expected from
the recent acquisition of the 1 Hotel Nashville and Embassy Suites
by Hilton Nashville Downtown. Due to the timing of the acquisition,
the results for these two hotels will be included in the comparable
hotel guidance starting in the second quarter. Additionally,
following the collapse of a portion of Highway 1 in California in
March 2024, Alila Ventana Big Sur temporarily closed on March 30,
2024 and will be removed from the forecast comparable hotel set for
full year 2024.
The Company anticipates its 2024 operating
results as compared to 2023 will be in the following range:
|
Current Full Year 2024 Guidance |
|
Current Full Year 2024 Guidance Change vs.
2023 |
|
Previous Full Year 2024 Guidance Change vs.
2023 |
|
Change in Full Year 2024 Guidance to the
Mid-Point |
Comparable hotel Total
RevPAR |
$352 to $359 |
|
2.7% to 4.6% |
|
2.9% to 5.8% |
|
(60) bps |
Comparable hotel RevPAR |
$214 to $218 |
|
2.0% to 4.0% |
|
2.5% to 5.5% |
|
(100) bps |
Total revenues under GAAP (in
millions) |
$5,650 to $5,753 |
|
6.4% to 8.3% |
|
5.2% to 8.1% |
|
80 bps |
Operating profit margin under
GAAP |
15.4% to 16.1% |
|
(20) bps to 50 bps |
|
(40) bps to 70 bps |
|
(10) bps |
Comparable hotel EBITDA
margin |
29.3% to 29.8% |
|
(80) bps to (30) bps |
|
(120) bps to (40) bps |
|
30 bps |
|
|
|
|
|
|
|
|
Based upon the above parameters, the Company
estimates its 2024 guidance as follows:
|
Current Full Year 2024 Guidance |
|
Previous Full Year 2024 Guidance |
|
Change in Full Year 2024 Guidance to the
Mid-Point |
Net income (in millions) |
$719 to $775 |
|
$708 to $794 |
|
$(4) |
Adjusted EBITDAre (in
millions) |
$1,640 to $1,700 |
|
$1,590 to $1,680 |
|
$35 |
Diluted earnings per common
share |
$1.00 to $1.08 |
|
$.99 to $1.11 |
|
$(0.01) |
NAREIT and Adjusted FFO per
diluted share |
$1.97 to $2.05 |
|
$1.92 to $2.04 |
|
$0.03 |
|
|
|
|
|
|
|
See the 2024 Forecast Schedules and the Notes to
Financial Information for items that may affect forecast results
and the First Quarter 2024 Supplemental Financial Information for
additional detail on the mid-point of full year 2024 guidance.
ABOUT HOST HOTELS & RESORTS
Host Hotels & Resorts, Inc. is an S&P
500 company and is the largest lodging real estate investment trust
and one of the largest owners of luxury and upper-upscale hotels.
The Company currently owns 74 properties in the United States and
five properties internationally totaling approximately 42,700
rooms. The Company also holds non-controlling interests in seven
domestic and one international joint ventures. Guided by a
disciplined approach to capital allocation and aggressive asset
management, the Company partners with premium brands such as
Marriott®, Ritz-Carlton®, Westin®, Sheraton®, W®, St. Regis®, The
Luxury Collection®, Hyatt®, Fairmont®, 1 Hotels®, Hilton®, Four
Seasons®, Swissôtel®, ibis® and Novotel®, as well as independent
brands. For additional information, please visit the Company’s
website at www.hosthotels.com.
Note: This press release contains
forward-looking statements within the meaning of federal securities
regulations. These forward-looking statements which include, but
may not be limited to, our expectations regarding the recovery of
travel and the lodging industry, the impact of the Maui wildfires
and 2024 estimates with respect to our business, including our
anticipated capital expenditures and financial and operating
results. Forward-looking statements are not guarantees of future
performance and involve known and unknown risks, uncertainties and
other factors which may cause the actual results to differ
materially from those anticipated at the time the forward-looking
statements are made. These risks include, but are not limited to,
those described in the Company’s annual report on Form 10-K and
other filings with the SEC. Although the Company believes the
expectations reflected in such forward-looking statements are based
upon reasonable assumptions, it can give no assurance that the
expectations will be attained or that any deviation will not be
material. All information in this release is as of May 1,
2024, and the Company undertakes no obligation to update any
forward-looking statement to conform the statement to actual
results or changes in the Company’s expectations.
- This press release
contains registered trademarks that are the exclusive property of
their respective owners. None of the owners of these trademarks has
any responsibility or liability for any information contained in
this press release.
*** Tables to Follow ***
Host Hotels & Resorts, Inc., herein referred to as “we,”
“Host Inc.,” or the “Company,” is a self-managed and
self-administered real estate investment trust that owns hotel
properties. We conduct our operations as an umbrella partnership
REIT through an operating partnership, Host Hotels & Resorts,
L.P. (“Host LP”), of which we are the sole general partner. When
distinguishing between Host Inc. and Host LP, the primary
difference is approximately 1% of the partnership interests in Host
LP held by outside partners as of March 31, 2024, which are
non-controlling interests in Host LP in our consolidated balance
sheets and are included in net (income) loss attributable to
non-controlling interests in our condensed consolidated statements
of operations. Readers are encouraged to find further detail
regarding our organizational structure in our annual report on Form
10-K.
HOST HOTELS & RESORTS, INC. Condensed
Consolidated Balance Sheets(unaudited, in millions, except
shares and per share amounts) |
|
|
|
March 31,2024 |
|
December 31,2023 |
|
|
|
|
|
ASSETS |
Property and equipment, net |
|
$ |
9,565 |
|
|
$ |
9,624 |
|
Right-of-use assets |
|
|
551 |
|
|
|
550 |
|
Due
from managers |
|
|
158 |
|
|
|
128 |
|
Advances to and investments in affiliates |
|
|
147 |
|
|
|
126 |
|
Furniture, fixtures and equipment replacement fund |
|
|
231 |
|
|
|
217 |
|
Notes
receivable |
|
|
72 |
|
|
|
72 |
|
Other |
|
|
391 |
|
|
|
382 |
|
Cash
and cash equivalents |
|
|
1,349 |
|
|
|
1,144 |
|
Total assets |
|
$ |
12,464 |
|
|
$ |
12,243 |
|
|
|
|
|
|
LIABILITIES, NON-CONTROLLING INTERESTS AND
EQUITY |
Debt⁽¹⁾ |
|
|
|
|
Senior notes |
|
$ |
3,121 |
|
|
$ |
3,120 |
|
Credit facility, including the term loans of $997 |
|
|
1,290 |
|
|
|
989 |
|
Mortgage and other debt |
|
|
99 |
|
|
|
100 |
|
Total debt |
|
|
4,510 |
|
|
|
4,209 |
|
Lease
liabilities |
|
|
564 |
|
|
|
563 |
|
Accounts payable and accrued expenses |
|
|
237 |
|
|
|
408 |
|
Due
to managers |
|
|
37 |
|
|
|
64 |
|
Other |
|
|
176 |
|
|
|
173 |
|
Total liabilities |
|
|
5,524 |
|
|
|
5,417 |
|
|
|
|
|
|
Redeemable non-controlling interests - Host Hotels &
Resorts, L.P. |
|
|
200 |
|
|
|
189 |
|
|
|
|
|
|
Host
Hotels & Resorts, Inc. stockholders’ equity: |
|
|
|
|
Common stock, par value $0.01, 1,050 million shares authorized,
705.0 million shares and 703.6 million shares issued and
outstanding, respectively |
|
|
7 |
|
|
|
7 |
|
Additional paid-in capital |
|
|
7,514 |
|
|
|
7,535 |
|
Accumulated other comprehensive loss |
|
|
(73 |
) |
|
|
(70 |
) |
Deficit |
|
|
(712 |
) |
|
|
(839 |
) |
Total equity of Host Hotels & Resorts, Inc. stockholders |
|
|
6,736 |
|
|
|
6,633 |
|
Non-redeemable non-controlling interests—other consolidated
partnerships |
|
|
4 |
|
|
|
4 |
|
Total equity |
|
|
6,740 |
|
|
|
6,637 |
|
Total liabilities, non-controlling interests and equity |
|
$ |
12,464 |
|
|
$ |
12,243 |
|
__________
(1) Please see our
First Quarter 2024 Supplemental Financial Information for more
detail on our debt balances and financial covenant ratios under our
credit facility and senior notes indentures.
HOST HOTELS & RESORTS, INC.Condensed
Consolidated Statements of Operations(unaudited, in
millions, except per share amounts) |
|
|
|
Quarter endedMarch 31, |
|
|
|
2024 |
|
|
|
2023 |
|
Revenues |
|
|
|
|
Rooms |
|
$ |
853 |
|
|
$ |
820 |
|
Food and beverage |
|
|
473 |
|
|
|
431 |
|
Other |
|
|
145 |
|
|
|
130 |
|
Total revenues |
|
|
1,471 |
|
|
|
1,381 |
|
Expenses |
|
|
|
|
Rooms |
|
|
202 |
|
|
|
193 |
|
Food and beverage |
|
|
295 |
|
|
|
269 |
|
Other departmental and support expenses |
|
|
334 |
|
|
|
315 |
|
Management fees |
|
|
69 |
|
|
|
65 |
|
Other property-level expenses |
|
|
104 |
|
|
|
91 |
|
Depreciation and amortization |
|
|
180 |
|
|
|
169 |
|
Corporate and other expenses⁽¹⁾ |
|
|
27 |
|
|
|
31 |
|
Gain on insurance settlements |
|
|
(31 |
) |
|
|
— |
|
Total operating costs and expenses |
|
|
1,180 |
|
|
|
1,133 |
|
Operating
profit |
|
|
291 |
|
|
|
248 |
|
Interest income |
|
|
18 |
|
|
|
14 |
|
Interest expense |
|
|
(47 |
) |
|
|
(49 |
) |
Other gains |
|
|
— |
|
|
|
69 |
|
Equity in earnings of affiliates |
|
|
8 |
|
|
|
7 |
|
Income before income
taxes |
|
|
270 |
|
|
|
289 |
|
Benefit for income taxes |
|
|
2 |
|
|
|
2 |
|
Net
income |
|
|
272 |
|
|
|
291 |
|
Less: Net income attributable
to non-controlling interests |
|
|
(4 |
) |
|
|
(4 |
) |
Net income
attributable to Host Inc. |
|
$ |
268 |
|
|
$ |
287 |
|
Basic and diluted
earnings per common share |
|
$ |
0.38 |
|
|
$ |
0.40 |
|
___________
(1) Corporate and
other expenses include the following items:
|
|
Quarter endedMarch 31, |
|
|
|
2024 |
|
|
|
2023 |
|
General and administrative
costs |
|
$ |
21 |
|
|
$ |
21 |
|
Non-cash stock-based
compensation expense |
|
|
6 |
|
|
|
7 |
|
Litigation accruals |
|
|
— |
|
|
|
3 |
|
Total |
|
$ |
27 |
|
|
$ |
31 |
|
HOST HOTELS & RESORTS, INC.Earnings
per Common Share(unaudited, in millions, except per share
amounts) |
|
|
|
Quarter ended March 31, |
|
|
|
2024 |
|
|
|
2023 |
|
Net income |
|
$ |
272 |
|
|
$ |
291 |
|
Less: Net income attributable to non-controlling interests |
|
|
(4 |
) |
|
|
(4 |
) |
Net income attributable to
Host Inc. |
|
$ |
268 |
|
|
$ |
287 |
|
|
|
|
|
|
Basic weighted average shares
outstanding |
|
|
704.0 |
|
|
|
713.4 |
|
Assuming distribution of common shares granted under the
comprehensive stock plans, less shares assumed purchased at
market |
|
|
1.5 |
|
|
|
1.5 |
|
Diluted weighted average
shares outstanding⁽¹⁾ |
|
|
705.5 |
|
|
|
714.9 |
|
Basic and diluted
earnings per common share |
|
$ |
0.38 |
|
|
$ |
0.40 |
|
___________(1)
Dilutive securities may include shares granted under comprehensive
stock plans, preferred operating partnership units (“OP Units”)
held by non-controlling limited partners and other non-controlling
interests that have the option to convert their limited partnership
interests to common OP Units. No effect is shown for any securities
that were anti-dilutive for the period.
HOST HOTELS & RESORTS, INC.Hotel
Operating Data for Consolidated Hotels |
|
Comparable Hotel Results by
Location(1) |
|
|
As of March 31, 2024 |
|
Quarter ended March 31, 2024 |
|
Quarter ended March 31, 2023 |
|
|
|
|
Location |
No. ofProperties |
|
No. ofRooms |
|
AverageRoom Rate |
|
AverageOccupancyPercentage |
|
RevPAR |
|
Total RevPAR |
|
AverageRoom Rate |
|
AverageOccupancyPercentage |
|
RevPAR |
|
Total RevPAR |
|
PercentChange inRevPAR |
|
PercentChange inTotal RevPAR |
Miami |
2 |
|
1,038 |
|
$ |
635.30 |
|
82.0 |
% |
|
$ |
520.71 |
|
$ |
867.57 |
|
$ |
643.96 |
|
77.9 |
% |
|
$ |
501.89 |
|
$ |
862.22 |
|
3.7 |
% |
|
0.6 |
% |
Phoenix |
3 |
|
1,545 |
|
|
490.11 |
|
81.3 |
% |
|
|
398.36 |
|
|
854.54 |
|
|
529.55 |
|
82.5 |
% |
|
|
436.73 |
|
|
878.14 |
|
(8.8 |
%) |
|
(2.7 |
%) |
Maui/Oahu |
4 |
|
2,006 |
|
|
539.98 |
|
72.6 |
% |
|
|
391.83 |
|
|
631.50 |
|
|
605.58 |
|
76.2 |
% |
|
|
461.65 |
|
|
700.34 |
|
(15.1 |
%) |
|
(9.8 |
%) |
Florida Gulf Coast |
4 |
|
1,403 |
|
|
436.83 |
|
80.1 |
% |
|
|
350.05 |
|
|
739.96 |
|
|
435.39 |
|
80.2 |
% |
|
|
349.32 |
|
|
760.63 |
|
0.2 |
% |
|
(2.7 |
%) |
Jacksonville |
1 |
|
446 |
|
|
528.66 |
|
64.6 |
% |
|
|
341.31 |
|
|
774.19 |
|
|
510.30 |
|
67.2 |
% |
|
|
343.06 |
|
|
768.78 |
|
(0.5 |
%) |
|
0.7 |
% |
Orlando |
2 |
|
2,448 |
|
|
407.08 |
|
74.2 |
% |
|
|
302.14 |
|
|
637.59 |
|
|
427.60 |
|
76.0 |
% |
|
|
325.11 |
|
|
641.80 |
|
(7.1 |
%) |
|
(0.7 |
%) |
San Diego |
3 |
|
3,294 |
|
|
294.27 |
|
77.4 |
% |
|
|
227.67 |
|
|
452.71 |
|
|
282.93 |
|
76.9 |
% |
|
|
217.70 |
|
|
422.03 |
|
4.6 |
% |
|
7.3 |
% |
Los Angeles/Orange County |
3 |
|
1,067 |
|
|
299.02 |
|
74.8 |
% |
|
|
223.80 |
|
|
334.70 |
|
|
296.72 |
|
79.9 |
% |
|
|
237.19 |
|
|
353.46 |
|
(5.6 |
%) |
|
(5.3 |
%) |
New York |
2 |
|
2,486 |
|
|
289.59 |
|
74.0 |
% |
|
|
214.29 |
|
|
317.47 |
|
|
281.95 |
|
73.3 |
% |
|
|
206.60 |
|
|
313.90 |
|
3.7 |
% |
|
1.1 |
% |
San Francisco/San Jose |
6 |
|
4,162 |
|
|
290.06 |
|
64.0 |
% |
|
|
185.67 |
|
|
280.40 |
|
|
290.85 |
|
60.8 |
% |
|
|
176.75 |
|
|
267.55 |
|
5.0 |
% |
|
4.8 |
% |
Washington, D.C. (CBD) |
5 |
|
3,245 |
|
|
275.83 |
|
66.9 |
% |
|
|
184.43 |
|
|
270.75 |
|
|
270.57 |
|
64.2 |
% |
|
|
173.81 |
|
|
261.11 |
|
6.1 |
% |
|
3.7 |
% |
Austin |
2 |
|
767 |
|
|
276.13 |
|
64.7 |
% |
|
|
178.72 |
|
|
323.83 |
|
|
289.30 |
|
70.1 |
% |
|
|
202.79 |
|
|
358.95 |
|
(11.9 |
%) |
|
(9.8 |
%) |
Houston |
5 |
|
1,942 |
|
|
223.14 |
|
74.6 |
% |
|
|
166.45 |
|
|
231.31 |
|
|
204.18 |
|
73.4 |
% |
|
|
149.81 |
|
|
209.59 |
|
11.1 |
% |
|
10.4 |
% |
Northern Virginia |
2 |
|
916 |
|
|
244.11 |
|
67.8 |
% |
|
|
165.55 |
|
|
265.89 |
|
|
227.21 |
|
65.6 |
% |
|
|
149.04 |
|
|
225.76 |
|
11.1 |
% |
|
17.8 |
% |
New Orleans |
1 |
|
1,333 |
|
|
211.33 |
|
74.6 |
% |
|
|
157.65 |
|
|
253.56 |
|
|
221.98 |
|
73.0 |
% |
|
|
161.94 |
|
|
238.77 |
|
(2.7 |
%) |
|
6.2 |
% |
Boston |
2 |
|
1,496 |
|
|
224.11 |
|
67.9 |
% |
|
|
152.09 |
|
|
221.78 |
|
|
210.79 |
|
69.2 |
% |
|
|
145.84 |
|
|
213.40 |
|
4.3 |
% |
|
3.9 |
% |
San Antonio |
2 |
|
1,512 |
|
|
229.52 |
|
66.1 |
% |
|
|
151.75 |
|
|
252.73 |
|
|
238.60 |
|
70.1 |
% |
|
|
167.19 |
|
|
266.21 |
|
(9.2 |
%) |
|
(5.1 |
%) |
Philadelphia |
2 |
|
810 |
|
|
202.76 |
|
72.8 |
% |
|
|
147.59 |
|
|
228.90 |
|
|
207.09 |
|
74.2 |
% |
|
|
153.60 |
|
|
239.52 |
|
(3.9 |
%) |
|
(4.4 |
%) |
Atlanta |
2 |
|
810 |
|
|
213.56 |
|
61.6 |
% |
|
|
131.66 |
|
|
227.78 |
|
|
196.79 |
|
74.0 |
% |
|
|
145.62 |
|
|
242.65 |
|
(9.6 |
%) |
|
(6.1 |
%) |
Seattle |
2 |
|
1,315 |
|
|
210.91 |
|
52.7 |
% |
|
|
111.05 |
|
|
162.48 |
|
|
197.72 |
|
53.1 |
% |
|
|
105.09 |
|
|
156.16 |
|
5.7 |
% |
|
4.1 |
% |
Chicago |
3 |
|
1,562 |
|
|
179.25 |
|
55.7 |
% |
|
|
99.76 |
|
|
145.54 |
|
|
178.91 |
|
51.6 |
% |
|
|
92.37 |
|
|
135.28 |
|
8.0 |
% |
|
7.6 |
% |
Denver |
3 |
|
1,342 |
|
|
177.37 |
|
55.3 |
% |
|
|
98.05 |
|
|
159.53 |
|
|
171.90 |
|
48.7 |
% |
|
|
83.66 |
|
|
114.72 |
|
17.2 |
% |
|
39.1 |
% |
Other |
10 |
|
3,061 |
|
|
351.34 |
|
58.4 |
% |
|
|
205.11 |
|
|
320.77 |
|
|
357.65 |
|
58.2 |
% |
|
|
208.18 |
|
|
321.87 |
|
(1.5 |
%) |
|
(0.3 |
%) |
Domestic |
71 |
|
40,006 |
|
|
318.95 |
|
68.9 |
% |
|
|
219.79 |
|
|
378.15 |
|
|
323.60 |
|
68.7 |
% |
|
|
222.38 |
|
|
375.83 |
|
(1.2 |
%) |
|
0.6 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
5 |
|
1,499 |
|
|
173.64 |
|
56.1 |
% |
|
|
97.47 |
|
|
139.44 |
|
|
171.05 |
|
60.3 |
% |
|
|
103.18 |
|
|
145.42 |
|
(5.5 |
%) |
|
(4.1 |
%) |
All Locations |
76 |
|
41,505 |
|
$ |
314.65 |
|
68.4 |
% |
|
$ |
215.37 |
|
$ |
369.58 |
|
$ |
318.75 |
|
68.4 |
% |
|
$ |
218.08 |
|
$ |
367.56 |
|
(1.2 |
%) |
|
0.5 |
% |
___________
(1) See the Notes to
Financial Information for a discussion of comparable hotel
operating statistics. CBD of a location refers to the central
business district. Hotel RevPAR is calculated as room revenues
divided by the available room nights. Hotel Total RevPAR is
calculated by dividing the sum of rooms, food and beverage and
other revenues by the available room nights.
|
|
Results
by Location - actual, based on ownership
period(1) |
|
|
As of March 31, |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
2023 |
|
Quarter ended March 31, 2024 |
|
Quarter ended March 31, 2023 |
|
|
|
|
Location |
No. ofProperties |
|
No. ofProperties |
|
AverageRoom Rate |
|
AverageOccupancyPercentage |
|
RevPAR |
|
Total RevPAR |
|
AverageRoom Rate |
|
AverageOccupancyPercentage |
|
RevPAR |
|
Total RevPAR |
|
PercentChange inRevPAR |
|
PercentChange inTotal RevPAR |
Miami |
2 |
|
2 |
|
$ |
635.30 |
|
82.0 |
% |
|
$ |
520.71 |
|
$ |
867.57 |
|
$ |
643.96 |
|
77.9 |
% |
|
$ |
501.89 |
|
$ |
862.22 |
|
3.7 |
% |
|
0.6 |
% |
Phoenix |
3 |
|
3 |
|
|
490.11 |
|
81.3 |
% |
|
|
398.36 |
|
|
854.54 |
|
|
506.37 |
|
81.9 |
% |
|
|
414.65 |
|
|
815.69 |
|
(3.9 |
%) |
|
4.8 |
% |
Maui/Oahu |
4 |
|
4 |
|
|
539.98 |
|
72.6 |
% |
|
|
391.83 |
|
|
631.50 |
|
|
605.58 |
|
76.2 |
% |
|
|
461.65 |
|
|
700.34 |
|
(15.1 |
%) |
|
(9.8 |
%) |
Florida Gulf Coast |
5 |
|
5 |
|
|
604.37 |
|
80.9 |
% |
|
|
488.72 |
|
|
983.10 |
|
|
435.50 |
|
60.8 |
% |
|
|
264.99 |
|
|
577.81 |
|
84.4 |
% |
|
70.1 |
% |
Jacksonville |
1 |
|
1 |
|
|
528.66 |
|
64.6 |
% |
|
|
341.31 |
|
|
774.19 |
|
|
510.30 |
|
67.2 |
% |
|
|
343.06 |
|
|
768.78 |
|
(0.5 |
%) |
|
0.7 |
% |
Orlando |
2 |
|
2 |
|
|
407.08 |
|
74.2 |
% |
|
|
302.14 |
|
|
637.59 |
|
|
427.60 |
|
76.0 |
% |
|
|
325.11 |
|
|
641.80 |
|
(7.1 |
%) |
|
(0.7 |
%) |
San Diego |
3 |
|
3 |
|
|
294.27 |
|
77.4 |
% |
|
|
227.67 |
|
|
452.71 |
|
|
282.93 |
|
76.9 |
% |
|
|
217.70 |
|
|
422.03 |
|
4.6 |
% |
|
7.3 |
% |
Los Angeles/Orange County |
3 |
|
3 |
|
|
299.02 |
|
74.8 |
% |
|
|
223.80 |
|
|
334.70 |
|
|
296.72 |
|
79.9 |
% |
|
|
237.19 |
|
|
353.46 |
|
(5.6 |
%) |
|
(5.3 |
%) |
New York |
2 |
|
2 |
|
|
289.59 |
|
74.0 |
% |
|
|
214.29 |
|
|
317.47 |
|
|
281.95 |
|
73.3 |
% |
|
|
206.60 |
|
|
313.90 |
|
3.7 |
% |
|
1.1 |
% |
San Francisco/San Jose |
6 |
|
6 |
|
|
290.06 |
|
64.0 |
% |
|
|
185.67 |
|
|
280.40 |
|
|
290.85 |
|
60.8 |
% |
|
|
176.75 |
|
|
267.55 |
|
5.0 |
% |
|
4.8 |
% |
Washington, D.C. (CBD) |
5 |
|
5 |
|
|
275.83 |
|
66.9 |
% |
|
|
184.43 |
|
|
270.75 |
|
|
270.57 |
|
64.2 |
% |
|
|
173.81 |
|
|
261.11 |
|
6.1 |
% |
|
3.7 |
% |
Austin |
2 |
|
2 |
|
|
276.13 |
|
64.7 |
% |
|
|
178.72 |
|
|
323.83 |
|
|
289.30 |
|
70.1 |
% |
|
|
202.79 |
|
|
358.95 |
|
(11.9 |
%) |
|
(9.8 |
%) |
Houston |
5 |
|
5 |
|
|
223.14 |
|
74.6 |
% |
|
|
166.45 |
|
|
231.31 |
|
|
204.18 |
|
73.4 |
% |
|
|
149.81 |
|
|
209.59 |
|
11.1 |
% |
|
10.4 |
% |
Northern Virginia |
2 |
|
2 |
|
|
244.11 |
|
67.8 |
% |
|
|
165.55 |
|
|
265.89 |
|
|
227.21 |
|
65.6 |
% |
|
|
149.04 |
|
|
225.76 |
|
11.1 |
% |
|
17.8 |
% |
New Orleans |
1 |
|
1 |
|
|
211.33 |
|
74.6 |
% |
|
|
157.65 |
|
|
253.56 |
|
|
221.98 |
|
73.0 |
% |
|
|
161.94 |
|
|
238.77 |
|
(2.7 |
%) |
|
6.2 |
% |
Boston |
2 |
|
2 |
|
|
224.11 |
|
67.9 |
% |
|
|
152.09 |
|
|
221.78 |
|
|
210.79 |
|
69.2 |
% |
|
|
145.84 |
|
|
213.40 |
|
4.3 |
% |
|
3.9 |
% |
San Antonio |
2 |
|
2 |
|
|
229.52 |
|
66.1 |
% |
|
|
151.75 |
|
|
252.73 |
|
|
238.60 |
|
70.1 |
% |
|
|
167.19 |
|
|
266.21 |
|
(9.2 |
%) |
|
(5.1 |
%) |
Philadelphia |
2 |
|
2 |
|
|
202.76 |
|
72.8 |
% |
|
|
147.59 |
|
|
228.90 |
|
|
207.09 |
|
74.2 |
% |
|
|
153.60 |
|
|
239.52 |
|
(3.9 |
%) |
|
(4.4 |
%) |
Atlanta |
2 |
|
2 |
|
|
213.56 |
|
61.6 |
% |
|
|
131.66 |
|
|
227.78 |
|
|
196.79 |
|
74.0 |
% |
|
|
145.62 |
|
|
242.65 |
|
(9.6 |
%) |
|
(6.1 |
%) |
Seattle |
2 |
|
2 |
|
|
210.91 |
|
52.7 |
% |
|
|
111.05 |
|
|
162.48 |
|
|
197.72 |
|
53.1 |
% |
|
|
105.09 |
|
|
156.16 |
|
5.7 |
% |
|
4.1 |
% |
Chicago |
3 |
|
3 |
|
|
179.25 |
|
55.7 |
% |
|
|
99.76 |
|
|
145.54 |
|
|
178.91 |
|
51.6 |
% |
|
|
92.37 |
|
|
135.28 |
|
8.0 |
% |
|
7.6 |
% |
Denver |
3 |
|
3 |
|
|
177.37 |
|
55.3 |
% |
|
|
98.05 |
|
|
159.53 |
|
|
171.90 |
|
48.7 |
% |
|
|
83.66 |
|
|
114.72 |
|
17.2 |
% |
|
39.1 |
% |
Other |
10 |
|
10 |
|
|
351.34 |
|
58.4 |
% |
|
|
205.11 |
|
|
320.77 |
|
|
357.65 |
|
58.2 |
% |
|
|
208.18 |
|
|
321.87 |
|
(1.5 |
%) |
|
(0.3 |
%) |
Domestic |
72 |
|
72 |
|
|
329.69 |
|
69.1 |
% |
|
|
227.73 |
|
|
393.64 |
|
|
323.61 |
|
68.0 |
% |
|
|
220.10 |
|
|
371.64 |
|
3.5 |
% |
|
5.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
5 |
|
5 |
|
|
173.64 |
|
56.1 |
% |
|
|
97.47 |
|
|
139.44 |
|
|
171.05 |
|
60.3 |
% |
|
|
103.18 |
|
|
145.42 |
|
(5.5 |
%) |
|
(4.1 |
%) |
All Locations |
77 |
|
77 |
|
$ |
325.14 |
|
68.6 |
% |
|
$ |
223.09 |
|
$ |
384.62 |
|
$ |
318.78 |
|
67.7 |
% |
|
$ |
215.94 |
|
$ |
363.65 |
|
3.3 |
% |
|
5.8 |
% |
___________
(1) Represents the
results of the portfolio for the time period of our ownership,
including the results of non-comparable properties, dispositions
through their date of disposal and acquisitions beginning as of the
date of acquisition.
HOST HOTELS & RESORTS, INC. Schedule
of Comparable Hotel Results (1)(unaudited, in millions,
except hotel statistics) |
|
|
Quarter ended March 31, |
|
|
2024 |
|
|
|
2023 |
|
Number of hotels |
|
76 |
|
|
|
76 |
|
Number of rooms |
|
41,505 |
|
|
|
41,505 |
|
Change in comparable hotel
Total RevPAR |
|
0.5 |
% |
|
|
— |
|
Change in comparable hotel
RevPAR |
|
(1.2 |
%) |
|
|
— |
|
Operating profit
margin⁽²⁾ |
|
19.8 |
% |
|
|
18.0 |
% |
Comparable hotel EBITDA
margin⁽²⁾ |
|
31.2 |
% |
|
|
32.6 |
% |
Food and beverage profit
margin⁽²⁾ |
|
37.6 |
% |
|
|
37.6 |
% |
Comparable hotel food and
beverage profit margin⁽²⁾ |
|
37.4 |
% |
|
|
37.7 |
% |
|
|
|
|
Net
income |
$ |
272 |
|
|
$ |
291 |
|
Depreciation and
amortization |
|
180 |
|
|
|
169 |
|
Interest expense |
|
47 |
|
|
|
49 |
|
Benefit for income taxes |
|
(2 |
) |
|
|
(2 |
) |
Gain on sale of property and
corporate level income/expense |
|
(20 |
) |
|
|
(59 |
) |
Property transaction
adjustments⁽³⁾ |
|
— |
|
|
|
(3 |
) |
Non-comparable hotel results,
net⁽⁴⁾ |
|
(42 |
) |
|
|
3 |
|
Comparable hotel
EBITDA⁽¹⁾ |
$ |
435 |
|
|
$ |
448 |
|
___________(1) See
the Notes to Financial Information for a discussion of comparable
hotel results, which are non-GAAP measures, and the limitations on
their use. For additional information on comparable hotel EBITDA by
location, see the First Quarter 2024 Supplemental Financial
Information posted on our website.(2) Profit margins are calculated
by dividing the applicable operating profit by the related revenue
amount. GAAP profit margins are calculated using amounts presented
in the unaudited condensed consolidated statements of operations.
Comparable hotel margins are calculated using amounts presented in
the following tables, which include reconciliations to the
applicable GAAP results:
|
Quarter ended March 31, 2024 |
|
Quarter ended March 31, 2023 |
|
|
|
Adjustments |
|
|
|
|
|
Adjustments |
|
|
|
GAAP Results |
|
Non-comparable hotelresults, net ⁽⁴⁾ |
|
Depreciation andcorporate level items |
|
Comparable hotelResults |
|
GAAP Results |
|
Property transactionadjustments ⁽³⁾ |
|
Non-comparable hotelresults, net ⁽⁴⁾ |
|
Depreciation andcorporate level items |
|
Comparable hotelResults |
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room |
$ |
853 |
|
|
$ |
(38 |
) |
|
$ |
— |
|
|
$ |
815 |
|
$ |
820 |
|
$ |
(5 |
) |
|
$ |
1 |
|
|
$ |
— |
|
|
$ |
816 |
Food and beverage |
|
473 |
|
|
|
(29 |
) |
|
|
— |
|
|
|
444 |
|
|
431 |
|
|
(2 |
) |
|
|
— |
|
|
|
— |
|
|
|
429 |
Other |
|
145 |
|
|
|
(6 |
) |
|
|
— |
|
|
|
139 |
|
|
130 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
130 |
Total revenues |
|
1,471 |
|
|
|
(73 |
) |
|
|
— |
|
|
|
1,398 |
|
|
1,381 |
|
|
(7 |
) |
|
|
1 |
|
|
|
— |
|
|
|
1,375 |
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room |
|
202 |
|
|
|
(5 |
) |
|
|
— |
|
|
|
197 |
|
|
193 |
|
|
(1 |
) |
|
|
— |
|
|
|
— |
|
|
|
192 |
Food and beverage |
|
295 |
|
|
|
(17 |
) |
|
|
— |
|
|
|
278 |
|
|
269 |
|
|
(1 |
) |
|
|
(1 |
) |
|
|
— |
|
|
|
267 |
Other |
|
507 |
|
|
|
(19 |
) |
|
|
— |
|
|
|
488 |
|
|
471 |
|
|
(2 |
) |
|
|
(1 |
) |
|
|
— |
|
|
|
468 |
Depreciation and amortization |
|
180 |
|
|
|
— |
|
|
|
(180 |
) |
|
|
— |
|
|
169 |
|
|
— |
|
|
|
— |
|
|
|
(169 |
) |
|
|
— |
Corporate and other expenses |
|
27 |
|
|
|
— |
|
|
|
(27 |
) |
|
|
— |
|
|
31 |
|
|
— |
|
|
|
— |
|
|
|
(31 |
) |
|
|
— |
Gain on insurance settlements |
|
(31 |
) |
|
|
10 |
|
|
|
21 |
|
|
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
Total expenses |
|
1,180 |
|
|
|
(31 |
) |
|
|
(186 |
) |
|
|
963 |
|
|
1,133 |
|
|
(4 |
) |
|
|
(2 |
) |
|
|
(200 |
) |
|
|
927 |
Operating Profit -
Comparable hotel EBITDA |
$ |
291 |
|
|
$ |
(42 |
) |
|
$ |
186 |
|
|
$ |
435 |
|
$ |
248 |
|
$ |
(3 |
) |
|
$ |
3 |
|
|
$ |
200 |
|
|
$ |
448 |
(3) Property
transaction adjustments represent the following items: (i) the
elimination of results of operations of our hotels sold or
held-for-sale as of the reporting date, which operations are
included in our unaudited condensed consolidated statements of
operations as continuing operations, and (ii) the addition of
results for periods prior to our ownership for hotels acquired as
of the reporting date.(4) Non-comparable hotel results, net,
includes the following items: (i) the results of operations of our
non-comparable hotels, which operations are included in our
condensed consolidated statements of operations as continuing
operations, and (ii) gains on business interruption proceeds
relating to events that occurred while the hotels were classified
as non-comparable.
HOST HOTELS & RESORTS,
INC.Reconciliation of Net Income
toEBITDA, EBITDAre and Adjusted EBITDAre
(1)(unaudited, in millions) |
|
|
Quarter ended March 31, |
|
|
2024 |
|
|
|
2023 |
|
Net
income |
$ |
272 |
|
|
$ |
291 |
|
Interest expense |
|
47 |
|
|
|
49 |
|
Depreciation and amortization |
|
180 |
|
|
|
169 |
|
Income taxes |
|
(2 |
) |
|
|
(2 |
) |
EBITDA |
|
497 |
|
|
|
507 |
|
Gain on dispositions⁽²⁾ |
|
— |
|
|
|
(69 |
) |
Equity investment adjustments: |
|
|
|
Equity in earnings of affiliates |
|
(8 |
) |
|
|
(7 |
) |
Pro rata EBITDAre of equity investments⁽³⁾ |
|
15 |
|
|
|
13 |
|
EBITDAre |
|
504 |
|
|
|
444 |
|
Adjustments to EBITDAre: |
|
|
|
Gain on property insurance settlement |
|
(21 |
) |
|
|
— |
|
Adjusted
EBITDAre |
$ |
483 |
|
|
$ |
444 |
|
___________(1) See
the Notes to Financial Information for discussion of non-GAAP
measures.(2) Reflects the sale of one hotel in 2023.(3) Unrealized
gains of our unconsolidated investments are not recognized in our
EBITDAre, Adjusted EBITDAre, NAREIT FFO or Adjusted FFO until they
have been realized by the unconsolidated partnership.
HOST HOTELS & RESORTS,
INC.Reconciliation of Diluted Earnings per Common
Share toNAREIT and Adjusted Funds From Operations
per Diluted Share (1)(unaudited, in millions, except per
share amounts) |
|
|
Quarter ended March 31, |
|
|
2024 |
|
|
|
2023 |
|
Net
income |
$ |
272 |
|
|
$ |
291 |
|
Less: Net income attributable to non-controlling interests |
|
(4 |
) |
|
|
(4 |
) |
Net income
attributable to Host Inc. |
|
268 |
|
|
|
287 |
|
Adjustments: |
|
|
|
Gain on dispositions⁽²⁾ |
|
— |
|
|
|
(69 |
) |
Gain on property insurance settlement |
|
(21 |
) |
|
|
— |
|
Depreciation and amortization |
|
180 |
|
|
|
168 |
|
Equity investment adjustments: |
|
|
|
Equity in earnings of affiliates |
|
(8 |
) |
|
|
(7 |
) |
Pro rata FFO of equity investments⁽³⁾ |
|
9 |
|
|
|
10 |
|
Consolidated partnership adjustments: |
|
|
|
FFO adjustments for non-controlling interests of Host L.P. |
|
(2 |
) |
|
|
(1 |
) |
NAREIT
FFO |
|
426 |
|
|
|
388 |
|
Adjustments to NAREIT
FFO: |
|
|
|
Loss on debt extinguishment |
|
— |
|
|
|
4 |
|
Adjusted
FFO |
$ |
426 |
|
|
$ |
392 |
|
|
|
|
|
For calculation on a
per share basis:⁽⁴⁾ |
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding - EPS, NAREIT FFO and Adjusted
FFO |
|
705.5 |
|
|
|
714.9 |
|
Diluted earnings per
common share |
$ |
0.38 |
|
|
$ |
0.40 |
|
NAREIT FFO per diluted
share |
$ |
0.60 |
|
|
$ |
0.54 |
|
Adjusted FFO per
diluted share |
$ |
0.60 |
|
|
$ |
0.55 |
|
___________
(1-3) Refer to the
corresponding footnote on the Reconciliation of Net Income to
EBITDA, EBITDAre and Adjusted EBITDAre. (4) Diluted earnings per
common share, NAREIT FFO per diluted share and Adjusted FFO per
diluted share are adjusted for the effects of dilutive securities.
Dilutive securities may include shares granted under comprehensive
stock plans, preferred OP units held by non-controlling limited
partners and other non-controlling interests that have the option
to convert their limited partnership interests to common OP units.
No effect is shown for securities if they are anti-dilutive.
HOST HOTELS & RESORTS,
INC.Reconciliation of Net Income to
EBITDA, EBITDAre and Adjusted EBITDAre and Diluted Earnings
per Common Share to NAREIT and Adjusted Funds From
Operations per Diluted Share for Full Year 2024 Forecasts
(1)(unaudited, in millions) |
|
|
Full Year 2024 |
|
Low-end of range |
|
High-end of range |
Net income |
$ |
719 |
|
|
$ |
775 |
|
Interest expense |
|
181 |
|
|
|
183 |
|
Depreciation and amortization |
|
719 |
|
|
|
719 |
|
Income taxes |
|
25 |
|
|
|
27 |
|
EBITDA |
|
1,644 |
|
|
|
1,704 |
|
Equity investment adjustments: |
|
|
|
Equity in earnings of affiliates |
|
(14 |
) |
|
|
(15 |
) |
Pro rata EBITDAre of equity investments |
|
42 |
|
|
|
43 |
|
EBITDAre |
|
1,672 |
|
|
|
1,732 |
|
Adjustments to EBITDAre: |
|
|
|
Gain on property insurance settlement |
|
(32 |
) |
|
|
(32 |
) |
Adjusted
EBITDAre |
$ |
1,640 |
|
|
$ |
1,700 |
|
|
Full Year 2024 |
|
Low-end of range |
|
High-end of range |
Net income |
$ |
719 |
|
|
$ |
775 |
|
Less: Net income attributable to non-controlling interests |
|
(11 |
) |
|
|
(12 |
) |
Net income
attributable to Host Inc. |
|
708 |
|
|
|
763 |
|
Adjustments: |
|
|
|
Gain on property insurance settlement |
|
(32 |
) |
|
|
(32 |
) |
Depreciation and amortization |
|
717 |
|
|
|
717 |
|
Equity investment adjustments: |
|
|
|
Equity in earnings of affiliates |
|
(14 |
) |
|
|
(15 |
) |
Pro rata FFO of equity investments |
|
24 |
|
|
|
25 |
|
Consolidated partnership adjustments: |
|
|
|
FFO adjustment for non-controlling partnerships |
|
(1 |
) |
|
|
(1 |
) |
FFO adjustment for non-controlling interests of Host LP |
|
(9 |
) |
|
|
(9 |
) |
NAREIT and Adjusted
FFO |
$ |
1,393 |
|
|
$ |
1,448 |
|
|
|
|
|
Diluted weighted
average shares outstanding - EPS, NAREIT FFO and Adjusted
FFO |
|
707.4 |
|
|
|
707.4 |
|
Diluted earnings per
common share |
$ |
1.00 |
|
|
$ |
1.08 |
|
NAREIT and Adjusted
FFO per diluted share |
$ |
1.97 |
|
|
$ |
2.05 |
|
_______________
(1) The Forecasts are
based on the below assumptions:
- Comparable hotel RevPAR will
increase 2.0% to 4.0% compared to 2023 for the low and high end of
the forecast range. Comparable hotel metrics do not yet include the
results of 1 Hotel Nashville and Embassy Suites by Hilton Nashville
Downtown, which were acquired in April 2024. We expect to include
the comparable hotel results for these two hotels beginning in the
second quarter.
- Comparable hotel EBITDA margins
will decrease 80 basis points to 30 basis points compared to 2023
for the low and high ends of the forecasted comparable hotel RevPAR
range, respectively.
- We expect to spend approximately
$500 million to $605 million on capital expenditures.
- Includes $17 million of net income
and $29 million of EBITDA from the 1 Hotel Nashville and Embassy
Suites by Hilton Nashville Downtown, acquired in April 2024.
Assumes no additional acquisitions and no dispositions during the
year.
- Assumes a total of $38 million of
gains from business interruption proceeds expected to be received
in 2024 related to Hurricane Ian and related to the Maui wildfire
disruption. No further business interruption gains are expected.
Also includes $32 million of insurance proceeds from Hurricane Ian
received through May 1, 2024 that result in a gain on property
insurance settlement. No further property insurance gains have been
included related to Hurricane Ian. We have collected $263 million
out of a potential $310 million insurance recovery related to
Hurricane Ian under our policy and we continue to work with our
insurers to recover the remaining amount, although there can be no
assurances that we will be able to achieve this result.
For a discussion of items that may affect
forecast results, see the Notes to Financial Information.
HOST HOTELS & RESORTS, INC. Schedule
of Comparable Hotel Results for Full Year 2024 Forecasts
(1)(unaudited, in millions) |
|
|
Full Year 2024 |
|
Low-end of range |
|
High-end of range |
Operating profit margin(2) |
|
15.4 |
% |
|
|
16.1 |
% |
Comparable hotel EBITDA
margin(2) |
|
29.3 |
% |
|
|
29.8 |
% |
|
|
|
|
Net
income |
$ |
719 |
|
|
$ |
775 |
|
Depreciation and amortization |
|
719 |
|
|
|
719 |
|
Interest expense |
|
181 |
|
|
|
183 |
|
Provision for income taxes |
|
25 |
|
|
|
27 |
|
Gain on sale of property and corporate level income/expense |
|
30 |
|
|
|
28 |
|
Forecast results for Nashville acquisition (1) |
|
(29 |
) |
|
|
(29 |
) |
Non-comparable hotel results, net(3) |
|
(77 |
) |
|
|
(78 |
) |
Comparable hotel
EBITDA(1) |
$ |
1,568 |
|
|
$ |
1,625 |
|
___________
(1) See
"Reconciliation of Net Income to EBITDA, EBITDAre and Adjusted
EBITDAre and Diluted Earnings per Common Share to NAREIT and
Adjusted Funds From Operations per Diluted Share for Full Year 2024
Forecasts" for other forecast assumptions. Forecast comparable
hotel results include 75 hotels (of our 77 hotels owned at
March 31, 2024) that we have assumed will be classified as
comparable as of December 31, 2024. As noted in the forecast
assumptions above, forecast results for the 1 Hotel Nashville and
Embassy Suites by Hilton Nashville Downtown, acquired in April
2024, are not yet included but are expected to be part of our
comparable hotel results for full year.(2) Profit margins are
calculated by dividing the applicable operating profit by the
related revenue amount. GAAP profit margins are calculated using
amounts presented in the unaudited condensed consolidated
statements of operations. Comparable hotel margins are calculated
using amounts presented in the following tables, which include
reconciliations to the applicable GAAP results:
|
Low-end of range |
|
High-end of range |
|
|
|
Adjustments |
|
|
|
|
|
Adjustments |
|
|
|
GAAP Results |
|
Forecast results for Nashville acquisition |
|
Non-comparable hotelresults, net |
|
Depreciation andcorporate level items |
|
Comparable hotelResults |
|
GAAP Results |
|
Forecast results for Nashville acquisition |
|
Non-comparable hotelresults, net |
|
Depreciation and corporate level items |
|
Comparable hotelResults |
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rooms |
$ |
3,416 |
|
|
$ |
(51 |
) |
|
$ |
(116 |
) |
|
$ |
— |
|
|
$ |
3,249 |
|
|
$ |
3,481 |
|
|
$ |
(51 |
) |
|
$ |
(117 |
) |
|
$ |
— |
|
|
$ |
3,313 |
|
Food and beverage |
|
1,707 |
|
|
|
(19 |
) |
|
|
(84 |
) |
|
|
— |
|
|
|
1,604 |
|
|
|
1,737 |
|
|
|
(19 |
) |
|
|
(85 |
) |
|
|
— |
|
|
|
1,633 |
|
Other |
|
527 |
|
|
|
(10 |
) |
|
|
(21 |
) |
|
|
— |
|
|
|
496 |
|
|
|
535 |
|
|
|
(10 |
) |
|
|
(21 |
) |
|
|
— |
|
|
|
504 |
|
Total revenues |
|
5,650 |
|
|
|
(80 |
) |
|
|
(221 |
) |
|
|
— |
|
|
|
5,349 |
|
|
|
5,753 |
|
|
|
(80 |
) |
|
|
(223 |
) |
|
|
— |
|
|
|
5,450 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotel expenses |
|
4,014 |
|
|
|
(51 |
) |
|
|
(162 |
) |
|
|
— |
|
|
|
3,801 |
|
|
|
4,059 |
|
|
|
(51 |
) |
|
|
(163 |
) |
|
|
— |
|
|
|
3,845 |
|
Depreciation and amortization |
|
719 |
|
|
|
|
|
— |
|
|
|
(719 |
) |
|
|
— |
|
|
|
719 |
|
|
|
|
|
— |
|
|
|
(719 |
) |
|
|
— |
|
Corporate and other expenses |
|
118 |
|
|
|
— |
|
|
|
— |
|
|
|
(118 |
) |
|
|
— |
|
|
|
118 |
|
|
|
|
|
— |
|
|
|
(118 |
) |
|
|
— |
|
Gain on insurance settlements |
|
(70 |
) |
|
|
— |
|
|
|
18 |
|
|
|
32 |
|
|
|
(20 |
) |
|
|
(70 |
) |
|
|
— |
|
|
|
18 |
|
|
|
32 |
|
|
|
(20 |
) |
Total expenses |
|
4,781 |
|
|
|
(51 |
) |
|
|
(144 |
) |
|
|
(805 |
) |
|
|
3,781 |
|
|
|
4,826 |
|
|
|
(51 |
) |
|
|
(145 |
) |
|
|
(805 |
) |
|
|
3,825 |
|
Operating Profit -
Comparable hotel EBITDA |
$ |
869 |
|
|
$ |
(29 |
) |
|
$ |
(77 |
) |
|
$ |
805 |
|
|
$ |
1,568 |
|
|
$ |
927 |
|
|
$ |
(29 |
) |
|
$ |
(78 |
) |
|
$ |
805 |
|
|
$ |
1,625 |
|
(3) Non-comparable hotel results, net, includes
the following items: (i) the results of operations of our
non-comparable hotels, which operations are included in our
condensed consolidated statements of operations as continuing
operations, and (ii) gains on business interruption proceeds
relating to events that occurred while the hotels were classified
as non-comparable. The following are expected to be non-comparable
for full year 2024:
- The Ritz-Carlton, Naples (business
disruption due to Hurricane Ian beginning in September 2022,
reopened in July 2023);
- Alila Ventana Big
Sur, (business disruption due to closure of a portion of Highway 1
in California resulting in temporary closure of the hotel beginning
at the end of March 2024); and
- Sales and marketing
expenses related to the development and sale of condominium units
on a development parcel adjacent to Four Seasons Resort Orlando at
Walt Disney World® Resort.
HOST HOTELS & RESORTS, INC.Notes to
Financial Information |
FORECASTS
Our forecast of net income, earnings per diluted
share, NAREIT and Adjusted FFO per diluted share, EBITDA, EBITDAre,
Adjusted EBITDAre and comparable hotel results are forward-looking
statements and are not guarantees of future performance and involve
known and unknown risks, uncertainties and other factors which may
cause actual results and performance to differ materially from
those expressed or implied by these forecasts. Although we believe
the expectations reflected in the forecasts are based upon
reasonable assumptions, we can give no assurance that the
expectations will be attained or that the results will not be
materially different. Risks that may affect these assumptions and
forecasts include the following: potential changes in overall
economic outlook make it inherently difficult to forecast the level
of RevPAR; the amount and timing of debt payments may change
significantly based on market conditions, which will directly
affect the level of interest expense and net income; the amount and
timing of transactions involving shares of our common stock may
change based on market conditions; and other risks and
uncertainties associated with our business described herein and in
our annual report on Form 10-K, quarterly reports on Form 10-Q and
current reports on Form 8-K filed with the SEC.
COMPARABLE HOTEL OPERATING STATISTICS
AND RESULTS
To facilitate a year-to-year comparison of our
operations, we present certain operating statistics (i.e., Total
RevPAR, RevPAR, average daily rate and average occupancy) and
operating results (revenues, expenses, hotel EBITDA and associated
margins) for the periods included in our reports on a comparable
hotel basis in order to enable our investors to better evaluate our
operating performance. We define our comparable hotels as those
that: (i) are owned or leased by us as of the reporting date and
are not classified as held-for-sale; and (ii) have not sustained
substantial property damage or business interruption, or undergone
large-scale capital projects, in each case requiring closures
lasting one month or longer (as further defined below), during the
reporting periods being compared.
We make adjustments to include recent
acquisitions to include results for periods prior to our ownership.
For these hotels, since the year-over-year comparison includes
periods prior to our ownership, the changes will not necessarily
correspond to changes in our actual results. Additionally,
operating results of hotels that we sell are excluded from the
comparable hotel set once the transaction has closed or the hotel
is classified as held-for-sale.
The hotel business is capital-intensive and
renovations are a regular part of the business. Generally, hotels
under renovation remain comparable hotels. A large-scale capital
project would cause a hotel to be excluded from our comparable
hotel set if it requires the entire property to be closed to hotel
guests for one month or longer.
Similarly, hotels are excluded from our
comparable hotel set from the date that they sustain substantial
property damage or business interruption if it requires the
property to be closed to hotel guests for one month or longer. In
each case, these hotels are returned to the comparable hotel set
when the operations of the hotel have been included in our
consolidated results for one full calendar year after the hotel has
reopened. Often, related to events that cause property damage and
the closure of a hotel, we will collect business interruption
insurance proceeds for the near-term loss of business. These
proceeds are included in gain on insurance settlements on our
condensed consolidated statements of operations. Business
interruption insurance gains related to a hotel that was excluded
from our comparable hotel set also will be excluded from the
comparable hotel results.
Of the 77 hotels that we owned as of
March 31, 2024, 76 have been classified as comparable hotels.
The operating results of the following properties that we owned as
of March 31, 2024 are excluded from comparable hotel results
for these periods:
- The Ritz-Carlton, Naples (business
disruption due to Hurricane Ian beginning in September 2022,
reopened in July 2023); and
- Sales and marketing expenses related to
the development and sale of condominium units on a development
parcel adjacent to Four Seasons Resort Orlando at Walt Disney
World® Resort.
Additionally, following the collapse of a
portion of Highway 1 in California, Alila Ventana Big Sur closed on
March 30, 2024 and has yet to reopen to guests. As a result, the
property will be removed from the comparable hotel set starting in
the second quarter.
FOREIGN CURRENCY TRANSLATION
Operating results denominated in foreign
currencies are translated using the prevailing exchange rates on
the date of the transaction, or monthly based on the weighted
average exchange rate for the period. Therefore, hotel statistics
and results for non-U.S. properties include the effect of currency
fluctuations, consistent with our financial statement
presentation.
NON-GAAP FINANCIAL MEASURES
Included in this press release are certain
“non-GAAP financial measures,” which are measures of our historical
or future financial performance that are not calculated and
presented in accordance with GAAP, within the meaning of applicable
SEC rules. They are as follows: (i) FFO and FFO per diluted share
(both NAREIT and Adjusted), (ii) EBITDA, (iii) EBITDAre and
Adjusted EBITDAre, and (iv) Comparable Hotel Operating Statistics
and Results. The following discussion defines these measures and
presents why we believe they are useful supplemental measures of
our performance.
NAREIT FFO AND NAREIT FFO PER DILUTED SHARE
We present NAREIT FFO and NAREIT FFO per diluted
share as non-GAAP measures of our performance in addition to our
earnings per share (calculated in accordance with GAAP). We
calculate NAREIT FFO per diluted share as our NAREIT FFO (defined
as set forth below) for a given operating period, as adjusted for
the effect of dilutive securities, divided by the number of fully
diluted shares outstanding during such period, in accordance with
NAREIT guidelines. As noted in NAREIT’s Funds From Operations White
Paper – 2018 Restatement, NAREIT defines FFO as net income
(calculated in accordance with GAAP) excluding depreciation and
amortization related to certain real estate assets, gains and
losses from the sale of certain real estate assets, gains and
losses from change in control, impairment expense of certain real
estate assets and investments and adjustments for consolidated
partially owned entities and unconsolidated affiliates. Adjustments
for consolidated partially owned entities and unconsolidated
affiliates are calculated to reflect our pro rata share of the FFO
of those entities on the same basis.
We believe that NAREIT FFO per diluted share is
a useful supplemental measure of our operating performance and that
the presentation of NAREIT FFO per diluted share, when combined
with the primary GAAP presentation of diluted earnings per share,
provides beneficial information to investors. By excluding the
effect of real estate depreciation, amortization, impairment
expense and gains and losses from sales of depreciable real estate,
all of which are based on historical cost accounting and which may
be of lesser significance in evaluating current performance, we
believe that such measures can facilitate comparisons of operating
performance between periods and with other REITs, even though
NAREIT FFO per diluted share does not represent an amount that
accrues directly to holders of our common stock. Historical cost
accounting for real estate assets implicitly assumes that the value
of real estate assets diminishes predictably over time. As noted by
NAREIT in its Funds From Operations White Paper – 2018 Restatement,
the primary purpose for including FFO as a supplemental measure of
operating performance of a REIT is to address the artificial nature
of historical cost depreciation and amortization of real estate and
real estate-related assets mandated by GAAP. For these reasons,
NAREIT adopted the FFO metric in order to promote a uniform
industry-wide measure of REIT operating performance.
Adjusted FFO per Diluted Share
We also present Adjusted FFO per diluted share
when evaluating our performance because management believes that
the exclusion of certain additional items described below provides
useful supplemental information to investors regarding our ongoing
operating performance. Management historically has made the
adjustments detailed below in evaluating our performance, in our
annual budget process and for our compensation programs. We believe
that the presentation of Adjusted FFO per diluted share, when
combined with both the primary GAAP presentation of diluted
earnings per share and FFO per diluted share as defined by NAREIT,
provides useful supplemental information that is beneficial to an
investor’s understanding of our operating performance. We adjust
NAREIT FFO per diluted share for the following items, which may
occur in any period, and refer to this measure as Adjusted FFO per
diluted share:
- Gains and Losses on
the Extinguishment of Debt – We exclude the effect of finance
charges and premiums associated with the extinguishment of debt,
including the acceleration of the write-off of deferred financing
costs from the original issuance of the debt being redeemed or
retired and incremental interest expense incurred during the
refinancing period. We also exclude the gains on debt repurchases
and the original issuance costs associated with the retirement of
preferred stock. We believe that these items are not reflective of
our ongoing finance costs.
- Acquisition Costs –
Under GAAP, costs associated with completed property acquisitions
that are considered business combinations are expensed in the year
incurred. We exclude the effect of these costs because we believe
they are not reflective of the ongoing performance of the
Company.
- Litigation Gains
and Losses – We exclude the effect of gains or losses associated
with litigation recorded under GAAP that we consider to be outside
the ordinary course of business. We believe that including these
items is not consistent with our ongoing operating
performance.
- Severance Expense
–In certain circumstances, we will add back hotel-level severance
expenses when we do not believe that such expenses are reflective
of the ongoing operation of our properties. Situations that would
result in a severance add-back include, but are not limited to, (i)
costs incurred as part of a broad-based reconfiguration of the
operating model with the specific hotel operator for a portfolio of
hotels and (ii) costs incurred at a specific hotel due to a
broad-based and significant reconfiguration of a hotel and/or its
workforce. We do not add back corporate-level severance costs or
severance costs at an individual hotel that we consider to be
incurred in the normal course of business.
In unusual circumstances, we also may adjust
NAREIT FFO for gains or losses that management believes are not
representative of the Company’s current operating performance. For
example, in 2017, as a result of the reduction of the U.S. federal
corporate income tax rate from 35% to 21% by the Tax Cuts and Jobs
Act, we remeasured our domestic deferred tax assets as of December
31, 2017 and recorded a one-time adjustment to reduce our deferred
tax assets and to increase the provision for income taxes by
approximately $11 million. We do not consider this adjustment to be
reflective of our ongoing operating performance and, therefore, we
excluded this item from Adjusted FFO.
EBITDA
Earnings before Interest Expense, Income Taxes,
Depreciation and Amortization (“EBITDA”) is a commonly used measure
of performance in many industries. Management believes EBITDA
provides useful information to investors regarding our results of
operations because it helps us and our investors evaluate the
ongoing operating performance of our properties after removing the
impact of the Company’s capital structure (primarily interest
expense) and its asset base (primarily depreciation and
amortization). Management also believes the use of EBITDA
facilitates comparisons between us and other lodging REITs, hotel
owners that are not REITs and other capital-intensive companies.
Management uses EBITDA to evaluate property-level results and as
one measure in determining the value of acquisitions and
dispositions and, like FFO and Adjusted FFO per diluted share, it
is widely used by management in the annual budget process and for
our compensation programs.
EBITDAre and Adjusted EBITDAre
We present EBITDAre in accordance with NAREIT
guidelines, as defined in its September 2017 white paper “Earnings
Before Interest, Taxes, Depreciation and Amortization for Real
Estate,” to provide an additional performance measure to facilitate
the evaluation and comparison of the Company’s results with other
REITs. NAREIT defines EBITDAre as net income (calculated in
accordance with GAAP) excluding interest expense, income tax,
depreciation and amortization, gains or losses on disposition of
depreciated property (including gains or losses on change of
control), impairment expense for depreciated property and of
investments in unconsolidated affiliates caused by a decrease in
value of depreciated property in the affiliate, and adjustments to
reflect the entity’s pro rata share of EBITDAre of unconsolidated
affiliates.
We make additional adjustments to EBITDAre when
evaluating our performance because we believe that the exclusion of
certain additional items described below provides useful
supplemental information to investors regarding our ongoing
operating performance. We believe that the presentation of Adjusted
EBITDAre, when combined with the primary GAAP presentation of net
income, is beneficial to an investor’s understanding of our
operating performance. Adjusted EBITDAre also is similar to the
measure used to calculate certain credit ratios for our credit
facility and senior notes. We adjust EBITDAre for the following
items, which may occur in any period, and refer to this measure as
Adjusted EBITDAre:
- Property Insurance
Gains – We exclude the effect of property insurance gains reflected
in our condensed consolidated statements of operations because we
believe that including them in Adjusted EBITDAre is not consistent
with reflecting the ongoing performance of our assets. In addition,
property insurance gains could be less important to investors given
that the depreciated asset book value written off in connection
with the calculation of the property insurance gain often does not
reflect the market value of real estate assets.
- Acquisition Costs –
Under GAAP, costs associated with completed property acquisitions
that are considered business combinations are expensed in the year
incurred. We exclude the effect of these costs because we believe
they are not reflective of the ongoing performance of the
Company.
- Litigation Gains
and Losses – We exclude the effect of gains or losses associated
with litigation recorded under GAAP that we consider to be outside
the ordinary course of business. We believe that including these
items is not consistent with our ongoing operating
performance.
- Severance Expense –
In certain circumstances, we will add back hotel-level severance
expenses when we do not believe that such expenses are reflective
of the ongoing operation of our properties. Situations that would
result in a severance add-back include, but are not limited to, (i)
costs incurred as part of a broad-based reconfiguration of the
operating model with the specific hotel operator for a portfolio of
hotels and (ii) costs incurred at a specific hotel due to a
broad-based and significant reconfiguration of a hotel and/or its
workforce. We do not add back corporate-level severance costs or
severance costs at an individual hotel that we consider to be
incurred in the normal course of business.
In unusual circumstances, we also may adjust
EBITDAre for gains or losses that management believes are not
representative of the Company’s current operating performance. The
last adjustment of this nature was a 2013 exclusion of a gain from
an eminent domain claim.
Limitations on the Use of NAREIT FFO per Diluted
Share, Adjusted FFO per Diluted Share, EBITDA, EBITDAre and
Adjusted EBITDAre
We calculate EBITDAre and NAREIT FFO per diluted
share in accordance with standards established by NAREIT, which may
not be comparable to measures calculated by other companies that do
not use the NAREIT definition of EBITDAre and FFO or do not
calculate FFO per diluted share in accordance with NAREIT guidance.
In addition, although EBITDAre and FFO per diluted share are useful
measures when comparing our results to other REITs, they may not be
helpful to investors when comparing us to non-REITs. We also
calculate Adjusted FFO per diluted share and Adjusted EBITDAre,
which measures are not in accordance with NAREIT guidance and may
not be comparable to measures calculated by other REITs or by other
companies. This information should not be considered as an
alternative to net income, operating profit, cash from operations
or any other operating performance measure calculated in accordance
with GAAP. Cash expenditures for various long-term assets (such as
renewal and replacement capital expenditures), interest expense
(for EBITDA, EBITDAre and Adjusted EBITDAre purposes only),
severance expense related to significant property-level
reconfiguration and other items have been, and will be, made and
are not reflected in the EBITDA, EBITDAre, Adjusted EBITDAre,
NAREIT FFO per diluted share and Adjusted FFO per diluted share
presentations. Management compensates for these limitations by
separately considering the impact of these excluded items to the
extent they are material to operating decisions or assessments of
our operating performance. Our consolidated statements of
operations and consolidated statements of cash flows in the
Company’s annual report on Form 10-K and quarterly reports on Form
10-Q include interest expense, capital expenditures, and other
excluded items, all of which should be considered when evaluating
our performance, as well as the usefulness of our non-GAAP
financial measures. Additionally, NAREIT FFO per diluted share,
Adjusted FFO per diluted share, EBITDA, EBITDAre and Adjusted
EBITDAre should not be considered as measures of our liquidity or
indicative of funds available to fund our cash needs, including our
ability to make cash distributions. In addition, NAREIT FFO per
diluted share and Adjusted FFO per diluted share do not measure,
and should not be used as measures of, amounts that accrue directly
to stockholders’ benefit.
Similarly, EBITDAre, Adjusted EBITDAre, NAREIT
FFO and Adjusted FFO per diluted share include adjustments for the
pro rata share of our equity investments, and NAREIT FFO and
Adjusted FFO per diluted share include adjustments for the pro rata
share of non-controlling partners in consolidated partnerships. Our
equity investments consist of interests ranging from 11% to 67% in
eight domestic and international partnerships that own a total of
35 properties and a vacation ownership development. Due to the
voting rights of the outside owners, we do not control and,
therefore, do not consolidate these entities. The non-controlling
partners in consolidated partnerships primarily consist of the
approximate 1% interest in Host LP held by unaffiliated limited
partners and a 15% interest held by an unaffiliated limited partner
in a partnership owning one hotel for which we do control the
entity and, therefore, consolidate its operations. These pro rata
results for NAREIT FFO and Adjusted FFO per diluted share, EBITDAre
and Adjusted EBITDAre were calculated as set forth in the
definitions above. Readers should be cautioned that the pro rata
results presented in these measures for consolidated partnerships
(for NAREIT FFO and Adjusted FFO per diluted share) and equity
investments may not accurately depict the legal and economic
implications of our investments in these entities.
Comparable Hotel Property Level Operating
Results
We present certain operating results for our
hotels, such as hotel revenues, expenses, food and beverage profit,
and EBITDA (and the related margins), on a comparable hotel, or
"same store," basis as supplemental information for our investors.
Our comparable hotel results present operating results for our
hotels without giving effect to dispositions or properties that
experienced closures due to renovations or property damage, as
discussed in “Comparable Hotel Operating Statistics and Results”
above. We present comparable hotel EBITDA to help us and our
investors evaluate the ongoing operating performance of our
comparable hotels after removing the impact of the Company’s
capital structure (primarily interest expense) and its asset base
(primarily depreciation and amortization expense). Corporate-level
costs and expenses also are removed to arrive at property-level
results. We believe these property-level results provide investors
with supplemental information about the ongoing operating
performance of our comparable hotels. Comparable hotel results are
presented both by location and for the Company’s properties in the
aggregate. We eliminate from our comparable hotel level operating
results severance costs related to broad-based and significant
property-level reconfiguration that is not considered to be within
the normal course of business, as we believe this elimination
provides useful supplemental information that is beneficial to an
investor’s understanding of our ongoing operating performance. We
also eliminate depreciation and amortization expense because, even
though depreciation and amortization expense are property-level
expenses, these non-cash expenses, which are based on historical
cost accounting for real estate assets, implicitly assume that the
value of real estate assets diminishes predictably over time. As
noted earlier, because real estate values historically have risen
or fallen with market conditions, many real estate industry
investors have considered presentation of historical cost
accounting for operating results to be insufficient.
Because of the elimination of corporate-level
costs and expenses, gains or losses on disposition, certain
severance expenses and depreciation and amortization expense, the
comparable hotel operating results we present do not represent our
total revenues, expenses, operating profit or net income and should
not be used to evaluate our performance as a whole. Management
compensates for these limitations by separately considering the
impact of these excluded items to the extent they are material to
operating decisions or assessments of our operating performance.
Our condensed consolidated statements of operations include such
amounts, all of which should be considered by investors when
evaluating our performance.
We present these hotel operating results on a
comparable hotel basis because we believe that doing so provides
investors and management with useful information for evaluating the
period-to-period performance of our hotels and facilitates
comparisons with other hotel REITs and hotel owners. In particular,
these measures assist management and investors in distinguishing
whether increases or decreases in revenues and/or expenses are due
to growth or decline of operations at comparable hotels (which
represent the vast majority of our portfolio) or from other
factors. While management believes that presentation of comparable
hotel results is a supplemental measure that provides useful
information in evaluating our ongoing performance, this measure is
not used to allocate resources or to assess the operating
performance of each of our hotels, as these decisions are based on
data for individual hotels and are not based on comparable hotel
results in the aggregate. For these reasons, we believe comparable
hotel operating results, when combined with the presentation of
GAAP operating profit, revenues and expenses, provide useful
information to investors and management.
SOURAV GHOSHChief Financial Officer(240)
744-5267 |
JAIME MARCUSInvestor Relations(240)
744-5117ir@hosthotels.com |
|
|
PDF
available: http://ml.globenewswire.com/Resource/Download/f5ec1b27-6a21-45b4-b004-3d620ab46b43
Host Hotels and Resorts (NASDAQ:HST)
Historical Stock Chart
From May 2024 to Jun 2024
Host Hotels and Resorts (NASDAQ:HST)
Historical Stock Chart
From Jun 2023 to Jun 2024