Host Hotels & Resorts Provides Update on Full-Year 2020 Guidance
10 March 2020 - 7:30AM
BETHESDA, Md., Mar 9, 2020 -- Host Hotels & Resorts,
Inc. (NYSE: HST), the nation's largest lodging real estate
investment trust (the "Company"), today announced it is withdrawing
its full-year 2020 guidance due to the ongoing financial impact of
reduced travel demand as a result of the global coronavirus
(COVID-19) outbreak.
Jim Risoleo, President and Chief Executive
Officer, said, “Given the global economic uncertainty COVID-19 has
created for the travel, airline, lodging and tourism and event
industries, among others, we are limited in our ability to
accurately predict what the financial impact to Host will be in
2020. In the spirit of being prudent and responsible financial
stewards, we believe it is currently appropriate to withdraw
financial guidance for the year. Importantly, Host has been a
leader in lodging since 1993 and has a strong track record of
successfully navigating significant global events that have
impacted lodging demand.”
Mr. Risoleo continued, “While we cannot predict
how long this situation will last, we have a strong balance sheet
with the capacity and flexibility to sustain prolonged disruption
and create long-term value for our shareholders through prudent and
disciplined capital allocation. Our hotels benefit from world-class
operators, including Marriott, Hyatt and Hilton, all of which are
committed to protecting the safety of guests, employees and other
partners, and have announced new policies and procedures with this
in mind. In addition, we are working closely with our operators to
implement contingency plans that will reduce Host’s operating costs
through this period of uncertainty.”
To date, the Company’s total revenues, net
income and adjusted EBITDAre have been negatively impacted by
approximately $97 million, $48 million and $48 million
respectively, excluding the collection of approximately $16 million
of cancellation fees. Of note:
- Several groups who have cancelled
their event have expressed a desire to rebook their event at our
properties later this year;
- Group business cancellations have
accounted for the majority of the impact on total revenues, with
California markets accounting for approximately 58% of the group
business cancellations;
- Group cancellation fee revenues are
expected to partially mitigate the expected losses to date, and the
Company plans to provide an update on its expectations for
cancellation fee collections on its first quarter 2020 earnings
call;
- Year-to-date notifications of group
business cancellations attributable to COVID-19 have not extended
beyond the first half of 2020; and
- Transient cancellations have also
increased significantly over prior periods, which the Company
believes are due to government and corporate travel restrictions
implemented as a result of COVID-19.
Due to the uncertainty regarding the duration
and extent of COVID-19, the Company cannot provide further
assurances regarding its effect on the Company’s results and the
Company does not intend to provide further updates unless deemed
appropriate.
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 75 properties in the United States and
five properties internationally totaling approximately 46,500
rooms. The Company also holds non-controlling interests in six
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®, Hilton®, Swissôtel®, ibis®
and Novotel®, as well as independent brands. For additional
information, please visit the Company’s website at
www.hosthotels.com.
* 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.
Note: This press release contains
forward-looking statements within the meaning of federal securities
regulations. These forward-looking statements include forecast
results and are identified by their use of terms and phrases such
as “anticipate,” “believe,” “could,” “estimate,” “expect,”
“intend,” “may,” “should,” “plan,” “predict,” “project,” “will,”
“continue” and other similar terms and phrases. 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: changes in national
and local economic and business conditions and other factors such
as natural disasters, pandemics and weather that will affect
occupancy rates at our hotels and the demand for hotel products and
services; the impact of geopolitical developments outside the U.S.
on lodging demand; volatility in global financial and credit
markets; operating risks associated with the hotel business; risks
and limitations in our operating flexibility associated with the
level of our indebtedness and our ability to meet covenants in our
debt agreements; risks associated with our relationships with
property managers and joint venture partners; our ability to
maintain our properties in a first-class manner, including meeting
capital expenditure requirements; the effects of hotel renovations
on our hotel occupancy and financial results; our ability to
compete effectively in areas such as access, location, quality of
accommodations and room rate structures; risks associated with our
ability to complete acquisitions and dispositions and develop new
properties and the risks that acquisitions and new developments may
not perform in accordance with our expectations; our ability to
continue to satisfy complex rules in order for us to remain a REIT
for federal income tax purposes; risks associated with our ability
to effectuate our dividend policy, including factors such as
operating results and the economic outlook influencing our board’s
decision whether to pay further dividends at levels previously
disclosed or to use available cash to make special dividends; and
other risks and uncertainties associated with our business
described in the Company’s annual report on Form 10-K, quarterly
reports on Form 10-Q and current reports on Form 8-K filed 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 the date of this
release, 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.
Tejal EngmanVice President240.744.5116
Host Hotels and Resorts (NYSE:HST)
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