Host Hotels & Resorts, Inc. (NYSE: HST) (the “Company”),
the nation’s largest lodging real estate investment trust (“REIT”),
today announced results for the second quarter of 2020.
James F. Risoleo, President and Chief Executive
Officer, said, “I am incredibly proud of Host’s swift and decisive
response to the challenging operating environment we faced in the
second quarter. We significantly reduced our monthly hotel-level
loss from April to June by working with our operators to reopen 19
hotels in a socially and financially responsible manner while
continuing to carefully control expenses. Our total portfolio grew
average occupancy by 380 basis points and improved average room
rates by over 50% from April through June. As importantly, we
worked with our supportive lending partners to successfully amend
our $2.5 billion credit agreement and achieved outstanding terms
that preserve the Company’s liquidity while retaining our
flexibility to capitalize on value-enhancing investment
opportunities during this period of extreme dislocation.”
Risoleo continued, “Although it remains
difficult to estimate the timing or magnitude of an economic
recovery, we are continuing to take actions to strengthen our
business to achieve our key near-term objectives, including
improving cash flow and achieving breakeven EBITDA at our hotels.
We are working with our operators to drive occupancy and increase
revenues while redefining our operating model to generate higher
levels of profitability at lower levels of occupancy. As we rise to
the unprecedented challenge facing the travel industry today, our
hearts and minds remain with all those affected by COVID-19, as
well as with the healthcare workers who are making tremendous
sacrifices to help save lives and end this crisis.”
OPERATING RESULTS(unaudited, in
millions, except per share and hotel statistics)
|
|
Quarter endedJune 30, |
|
|
Percent |
|
|
Year-to-date endedJune 30, |
|
|
Percent |
|
|
|
2020 |
|
|
2019 |
|
|
Change |
|
|
2020 |
|
|
2019 |
|
|
Change |
|
Revenues |
|
$ |
103 |
|
|
$ |
1,483 |
|
|
(93.1 |
)% |
|
$ |
1,155 |
|
|
$ |
2,873 |
|
|
(59.8 |
)% |
All owned hotel revenues (pro
forma) (1) |
|
|
103 |
|
|
|
1,398 |
|
|
(92.6 |
)% |
|
|
1,155 |
|
|
|
2,712 |
|
|
(57.4 |
)% |
Net income (loss) |
|
|
(356 |
) |
|
|
290 |
|
|
N/M |
|
|
|
(359 |
) |
|
|
479 |
|
|
N/M |
|
EBITDAre and Adjusted EBITDAre
(1) |
|
|
(190 |
) |
|
|
460 |
|
|
N/M |
|
|
|
(26 |
) |
|
|
867 |
|
|
N/M |
|
All owned hotel Total RevPAR -
Constant US$ |
|
|
23.16 |
|
|
|
327.00 |
|
|
(92.9 |
)% |
|
|
134.46 |
|
|
|
319.06 |
|
|
(57.9 |
)% |
All owned hotel RevPAR -
Constant US$ |
|
|
14.31 |
|
|
|
204.15 |
|
|
(93.0 |
)% |
|
|
80.81 |
|
|
|
198.12 |
|
|
(59.2 |
)% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings (loss) per
common share |
|
|
(0.50 |
) |
|
|
0.39 |
|
|
N/M |
|
|
|
(0.50 |
) |
|
|
0.64 |
|
|
N/M |
|
NAREIT FFO and Adjusted FFO
per diluted share (1) |
|
|
(0.26 |
) |
|
|
0.53 |
|
|
N/M |
|
|
|
(0.03 |
) |
|
|
1.01 |
|
|
N/M |
|
__________N/M = Not meaningful.
(1) NAREIT Funds From Operations (“FFO”) per
diluted share, Adjusted FFO per diluted share, EBITDAre, Adjusted
EBITDAre and all owned hotel results (pro forma) 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.
*Additional detail on the Company’s results,
including data for 22 domestic markets and top 40 hotels by Total
RevPAR, is available in the Second Quarter 2020 Supplemental
Financial Information available on the Company’s website at
www.hosthotels.com.
PORTFOLIO HIGHLIGHTS:
- As of July 30, 2020, re-opened 19
of the 35 hotels that had suspended operations as of May 6,
2020.
- Improved average occupancy by 380
basis points, from 6.9% in April to 10.7% in June 2020.
- Improved average room rate by over
50%, from $129 in April to $194 in June 2020.
UPDATE ON COVID-19
RESPONSE
In response to the COVID-19 pandemic, the
Company and its hotel operators have prioritized preserving
financial liquidity and ensuring that its hotels are well
positioned for recovery. Actions by the Company in support of these
priorities include:
Preserving financial liquidity:
Hotel Operations
- Reduced portfolio-wide hotel
operating costs by approximately 70% in the second quarter compared
to the prior year, by suspending operations at certain hotels,
furloughs of hotel employees and scaling back operations.
- Reduced hotel labor costs
significantly due to the furlough of up to 80% of hotel employees
who received healthcare benefits and special pay of $45 million in
the second quarter. The Company accrued $35 million of these
second-quarter costs in the first quarter and $32 million of
these third-quarter costs in the second quarter.
Balance Sheet, Capital Allocation and Expense
Management
- Amended the credit agreement
governing the $1.5 billion revolving credit facility and two
$500 million term loans in June 2020, while preserving the
Company’s flexibility in making acquisitions and raising capital,
subject to certain restrictions. Additional detail on the Company’s
second quarter covenant levels is available in the Second Quarter
2020 Supplemental Financial Information available on the Company’s
website at www.hosthotels.com.
- Suspended the quarterly dividend
and stock repurchases.
- Continue to expect reductions in
corporate expenses for the full year of 10-15% compared to the
prior year. Corporate expenses in the second quarter were unchanged
from the prior year due to timing of certain expenses.
Positioning for recovery:
- Continued to take advantage of
reduced demand to complete Marriott transformational capital
program and other ROI projects. The Company believes the
renovations will position these hotels to capture additional
revenue during a potential economic recovery.
- Continued to review operating costs
at varying levels of occupancy with a focus on modernizing brand
standards, streamlining operating departments and accelerating the
adoption of cost-saving technology.
The impact of the COVID-19 pandemic on the
Company remains fluid and a great deal of uncertainty surrounding
the trends and duration of the COVID-19 pandemic remains. The
Company, as well as its hotel managers, are monitoring developments
on an ongoing basis and may take additional actions in response to
future developments to reduce the impact to the Company’s
stakeholders.
OPERATING RESULTS
The Company’s prior year presentation of
comparable hotel performance is no longer relevant given the impact
of COVID-19. Hotel operating results, including RevPAR, are being
reported on an All Owned Hotel pro forma basis, which includes all
consolidated properties owned as of June 30, 2020, but does
not include the results of operations for properties sold in 2019.
Additionally, operating results for acquisitions in the prior year
are reflected for the full 2019 calendar quarter, to include
results for periods prior to the Company’s ownership. See the Notes
to Financial Information – All Owned Hotel Operating Statistics and
Results for further information on these pro forma statistics.
Due to low occupancy levels and/or state
mandates, operations remain suspended at 16 hotels in the Company’s
portfolio as of July 30, 2020. The Company has provided a complete
list of these suspended hotels on page 41 of its Second Quarter
2020 Supplemental Information available on the Company’s website at
www.hosthotels.com.
The following presents the monthly hotel
operating results for the full portfolio and for the hotels without
suspended operations during the periods presented:
|
|
Total Portfolio |
|
|
Open Hotels (2) |
|
|
|
April |
|
|
May |
|
|
June |
|
|
April |
|
|
May |
|
|
June |
|
Number of hotels |
|
|
80 |
|
|
|
80 |
|
|
|
80 |
|
|
|
45 |
|
|
|
45 |
|
|
|
47 |
|
Number of rooms |
|
|
46,669 |
|
|
|
46,670 |
|
|
|
46,670 |
|
|
|
26,379 |
|
|
|
26,379 |
|
|
|
27,280 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Occupancy
Percentage |
|
|
6.9 |
% |
|
|
8.8 |
% |
|
|
10.7 |
% |
|
|
12.1 |
% |
|
|
15.3 |
% |
|
|
16.3 |
% |
Average Room Rate |
|
$ |
128.54 |
|
|
$ |
150.16 |
|
|
$ |
193.67 |
|
|
$ |
134.01 |
|
|
$ |
146.09 |
|
|
$ |
182.26 |
|
RevPAR |
|
$ |
8.92 |
|
|
$ |
13.29 |
|
|
$ |
20.77 |
|
|
$ |
16.16 |
|
|
$ |
22.37 |
|
|
$ |
29.71 |
|
__________(2) Represents the hotels that were
accepting reservations during the entirety of the month. Excludes
the 35, 35, and 33 hotels with suspended operations in the months
of April, May, and June, respectively.
During the COVID-19 pandemic, the Company has
remained keenly focused on monthly operating results and the effect
on the long-term liquidity of the Company, and, as a result of the
initiatives discussed above, significantly reduced its monthly cash
expenditures for the second quarter of 2020. The following presents
the second quarter 2020 results (in millions):
|
|
April |
|
|
May |
|
|
June |
|
|
Quarter endedJune 30, 2020 |
|
Revenues |
|
$ |
24 |
|
|
$ |
30 |
|
|
$ |
49 |
|
|
$ |
103 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
|
(120 |
) |
|
|
(114 |
) |
|
|
(122 |
) |
|
|
(356 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotel-level operating loss
(3) |
|
|
(73 |
) |
|
|
(53 |
) |
|
|
(37 |
) |
|
|
(163 |
) |
Significant expenditures for the second quarter
included in the Company’s total cash burn are (in millions):
|
|
Quarter ended June 30, 2020 |
|
GAAP net cash used in operating activities |
|
$ |
(172 |
) |
Cash burn (3) |
|
$ |
(399 |
) |
|
|
|
|
|
Components of cash burn: |
|
|
|
|
Hotel-level operating loss (3) |
|
|
(163 |
) |
Interest payments |
|
|
(46 |
) |
Cash corporate and other expenses |
|
|
(21 |
) |
Capital expenditures |
|
|
(169 |
) |
__________(3) Hotel-level operating loss and
cash burn are non-GAAP 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.
The Company’s long-term liquidity can be
estimated based on the average monthly cash burn using the second
quarter performance. In this scenario, the average monthly GAAP
cash used in operating activities would be approximately $75
million at the midpoint, which includes estimated interest,
corporate-level expense, and cash timing adjustments, and the
monthly cash burn for the remainder of 2020 would be approximately
$100 million to $110 million(3), which includes estimated monthly
capital expenditures. In this scenario, the total available
liquidity at the end of 2020 would be approximately $1.8 billion to
$1.9 billion, including cash, FF&E reserves and capacity under
the credit facility. Further, at this estimated level of activity,
the Company anticipates it would have ample liquidity until the
middle of 2022, subject to obtaining continued covenant waivers
from the lenders under the credit facility.
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 2019 room
sales.
During the second quarter, demand was primarily
driven by drive-to and resort destinations. The following are the
results of the Company’s consolidated portfolio transient, group
and contract business:
|
|
Quarter ended June 30, 2020 |
|
|
Percent change vs.Quarter ended June 30, 2019 |
|
|
|
Room nights(in thousands) |
|
|
Room Revenues(in millions) |
|
|
Room nights |
|
|
Room Revenues |
|
Transient business |
|
|
198 |
|
|
$ |
37 |
|
|
|
(90.0 |
)% |
|
|
(92.8 |
)% |
Group business |
|
|
134 |
|
|
|
18 |
|
|
|
(90.0 |
)% |
|
|
(94.3 |
)% |
Contract business |
|
|
43 |
|
|
|
6 |
|
|
|
(74.1 |
)% |
|
|
(83.3 |
)% |
As of July 30, 2020, 2.7 million group room
nights for the year have been cancelled. This equates to an
estimated $1.0 billion in total cancelled group revenue of which
approximately 62% is rooms revenue. Approximately 63% of the group
room revenue lost was for the first half of the year. The Company
believes that the pace of group and transient business remains
uncertain for the second half of the year due to the continued
uncertainty surrounding the pandemic, government restrictions on
travel, and companies’ restrictions on business travel. The Company
expects further cancellations of group business in the second half
of the year.
CAPITAL EXPENDITURES
The Company’s capital expenditures spending is
expected to range from $475 million to $520 million for full year
2020:
|
|
Year-to-date endedJune 30, 2020 |
|
|
2020 Full Year Forecast |
|
|
|
Actuals |
|
|
Low-end of range |
|
|
High-end of range |
|
ROI - Marriott transformational capital program |
|
$ |
118 |
|
|
$ |
195 |
|
|
$ |
200 |
|
ROI - All other ROI
projects |
|
|
88 |
|
|
|
130 |
|
|
|
145 |
|
Total ROI project spend |
|
|
206 |
|
|
|
325 |
|
|
|
345 |
|
Renewals and Replacements |
|
|
94 |
|
|
|
150 |
|
|
|
175 |
|
Total Capital
Expenditures |
|
$ |
300 |
|
|
$ |
475 |
|
|
$ |
520 |
|
Through the second quarter of 2020, the Company
completed almost 60% of the total capital expenditure projects
planned for the year and expects total spend in the second half of
the year to be approximately $100 million lower than the first
half. The full year forecast ROI capital expenditures includes $200
million for the Marriott transformational capital program, for
which Marriott is expected to provide operating profit guarantees
of approximately $20 million in 2020, including $6 million that was
received in the second quarter of 2020.
The Company has prioritized major capital
projects in those assets and markets that are expected to recover
faster, such as leisure and drive-to destinations, as well as
previously announced major return on investment projects. The
Company is utilizing the low occupancy environment to accelerate
certain projects and minimize future disruption.
DISPOSITIONS
During the quarter, the Company sold a parcel of
land adjacent to The Phoenician hotel for approximately $17
million, of which half was financed through a bridge loan to the
buyer, and recorded a gain of $12 million.
BALANCE SHEET
The Company maintains a robust balance sheet
with the following values at June 30, 2020:
- Total assets of $12.2 billion.
- Cash balance of approximately $1.6
billion, FF&E escrow reserves of $154 million, and $750
million of available capacity under the revolver portion of the
credit facility, following the June repayment of
$750 million.
- Debt balance of $4.5 billion,
with an average maturity of 4.7 years, an average interest rate of
3.0%, and no significant maturities until 2023.
The Company’s quarterly-tested financial
covenants in its credit facility were waived beginning July 1, 2020
through the second quarter of 2021, with testing resuming for the
third quarter of 2021.
2020 OUTLOOK
Given the global economic uncertainty COVID-19
has created for the travel, airline, lodging and tourism and event
industries, among others, the Company cannot provide full year
guidance for its operations or fully estimate the effect of
COVID-19 on operations. The Company’s results during the second
quarter reflected the unprecedented declines resulting from
COVID-19. The Company does not expect to see a material improvement
in operations until government restrictions have been lifted and
business and leisure travelers are comfortable that the risks
associated with traveling and contracting COVID-19 are
significantly reduced. 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 46,700 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.
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, including
references to assumptions and forecasts of future 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: the duration
and scope of the COVID-19 pandemic and its short and longer-term
impact on the demand for travel, transient and group business, and
levels of consumer confidence; actions governments, businesses and
individuals take in response to the pandemic, including limiting or
banning travel; the impact of the pandemic and actions taken in
response to the pandemic on global and regional economies, travel,
and economic activity, including the duration and magnitude of its
impact on unemployment rates, business investment and consumer
discretionary spending; the pace of recovery when the COVID-19
pandemic subsides; general economic uncertainty in U.S. markets
where we own hotels and a worsening of economic conditions or low
levels of economic growth in these markets; the effects of steps we
and our hotel managers take to reduce operating costs in response
to the COVID-19 pandemic; other changes (apart from the COVID-19
pandemic) in national and local economic and business conditions
and other factors such as natural disasters 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 July 30, 2020 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
June 30, 2020, which is non-controlling interests in Host LP in our
consolidated balance sheets and is included in net (income) loss
attributable to non-controlling interests in our 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)
|
|
June 30, 2020 |
|
|
December 31, 2019 |
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
Property and equipment,
net |
|
$ |
9,613 |
|
|
$ |
9,671 |
|
Right-of-use assets |
|
|
595 |
|
|
|
595 |
|
Due from managers |
|
|
6 |
|
|
|
63 |
|
Advances to and investments in
affiliates |
|
|
38 |
|
|
|
56 |
|
Furniture, fixtures and
equipment replacement fund |
|
|
154 |
|
|
|
176 |
|
Other |
|
|
206 |
|
|
|
171 |
|
Cash and cash equivalents |
|
|
1,578 |
|
|
|
1,573 |
|
Total assets |
|
$ |
12,190 |
|
|
$ |
12,305 |
|
|
|
|
|
|
|
|
|
|
LIABILITIES, NON-CONTROLLING INTERESTS AND
EQUITY |
|
Debt (1) |
|
|
|
|
|
|
|
|
Senior notes |
|
$ |
2,778 |
|
|
$ |
2,776 |
|
Credit facility, including the term loans of $997 |
|
|
1,736 |
|
|
|
989 |
|
Other debt |
|
|
29 |
|
|
|
29 |
|
Total debt |
|
|
4,543 |
|
|
|
3,794 |
|
Lease liabilities |
|
|
607 |
|
|
|
606 |
|
Accounts payable and accrued
expenses |
|
|
68 |
|
|
|
263 |
|
Other |
|
|
169 |
|
|
|
175 |
|
Total liabilities |
|
|
5,387 |
|
|
|
4,838 |
|
|
|
|
|
|
|
|
|
|
Redeemable non-controlling
interests - Host Hotels & Resorts, L.P. |
|
|
81 |
|
|
|
142 |
|
|
|
|
|
|
|
|
|
|
Host Hotels & Resorts,
Inc. stockholders’ equity: |
|
|
|
|
|
|
|
|
Common stock, par value $.01, 1,050 million shares authorized,
705.2 million shares and 713.4 million shares issued and
outstanding, respectively |
|
|
7 |
|
|
|
7 |
|
Additional paid-in capital |
|
|
7,586 |
|
|
|
7,675 |
|
Accumulated other comprehensive loss |
|
|
(74 |
) |
|
|
(56 |
) |
Deficit |
|
|
(802 |
) |
|
|
(307 |
) |
Total equity of Host Hotels & Resorts, Inc. stockholders |
|
|
6,717 |
|
|
|
7,319 |
|
Non-redeemable non-controlling
interests—other consolidated partnerships |
|
|
5 |
|
|
|
6 |
|
Total equity |
|
|
6,722 |
|
|
|
7,325 |
|
Total liabilities, non-controlling interests and equity |
|
$ |
12,190 |
|
|
$ |
12,305 |
|
___________ |
|
|
|
|
|
|
|
|
(1) Please see our Second Quarter 2020
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 ended June 30, |
|
|
Year-to-date ended June 30, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rooms |
|
$ |
61 |
|
|
$ |
931 |
|
|
$ |
687 |
|
|
$ |
1,788 |
|
Food and beverage |
|
|
11 |
|
|
|
449 |
|
|
|
341 |
|
|
|
882 |
|
Other |
|
|
31 |
|
|
|
103 |
|
|
|
127 |
|
|
|
203 |
|
Total revenues |
|
|
103 |
|
|
|
1,483 |
|
|
|
1,155 |
|
|
|
2,873 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rooms |
|
|
43 |
|
|
|
226 |
|
|
|
230 |
|
|
|
443 |
|
Food and beverage |
|
|
39 |
|
|
|
290 |
|
|
|
284 |
|
|
|
575 |
|
Other departmental and support expenses |
|
|
113 |
|
|
|
334 |
|
|
|
432 |
|
|
|
661 |
|
Management fees |
|
|
(2 |
) |
|
|
71 |
|
|
|
28 |
|
|
|
125 |
|
Other property-level expenses |
|
|
70 |
|
|
|
91 |
|
|
|
163 |
|
|
|
183 |
|
Depreciation and amortization |
|
|
168 |
|
|
|
166 |
|
|
|
332 |
|
|
|
336 |
|
Corporate and other expenses(1) |
|
|
25 |
|
|
|
25 |
|
|
|
50 |
|
|
|
54 |
|
Total operating costs and expenses |
|
|
456 |
|
|
|
1,203 |
|
|
|
1,519 |
|
|
|
2,377 |
|
Operating profit
(loss) |
|
|
(353 |
) |
|
|
280 |
|
|
|
(364 |
) |
|
|
496 |
|
Interest income |
|
|
1 |
|
|
|
7 |
|
|
|
7 |
|
|
|
15 |
|
Interest expense |
|
|
(40 |
) |
|
|
(43 |
) |
|
|
(77 |
) |
|
|
(86 |
) |
Other gains/(losses) |
|
|
13 |
|
|
|
57 |
|
|
|
12 |
|
|
|
62 |
|
Gain on foreign currency
transactions and derivatives |
|
|
2 |
|
|
|
1 |
|
|
|
1 |
|
|
|
1 |
|
Equity in earnings (losses) of
affiliates |
|
|
(25 |
) |
|
|
4 |
|
|
|
(21 |
) |
|
|
9 |
|
Income (loss) before
income taxes |
|
|
(402 |
) |
|
|
306 |
|
|
|
(442 |
) |
|
|
497 |
|
Benefit (provision) for income
taxes |
|
|
46 |
|
|
|
(16 |
) |
|
|
83 |
|
|
|
(18 |
) |
Net income
(loss) |
|
|
(356 |
) |
|
|
290 |
|
|
|
(359 |
) |
|
|
479 |
|
Less: Net (income) loss attributable to non-controlling interests |
|
|
4 |
|
|
|
(4 |
) |
|
|
4 |
|
|
|
(7 |
) |
Net income (loss)
attributable to Host Inc. |
|
$ |
(352 |
) |
|
$ |
286 |
|
|
$ |
(355 |
) |
|
$ |
472 |
|
Basic and diluted
earnings (loss) per common share |
|
$ |
(.50 |
) |
|
$ |
.39 |
|
|
$ |
(.50 |
) |
|
$ |
.64 |
|
___________ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Corporate and other expenses include the
following items:
|
|
Quarter ended June 30, |
|
|
Year-to-date ended June 30, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
General and administrative costs |
|
$ |
21 |
|
|
$ |
22 |
|
|
$ |
43 |
|
|
$ |
47 |
|
Non-cash stock-based
compensation expense |
|
|
4 |
|
|
|
3 |
|
|
|
7 |
|
|
|
7 |
|
Total |
|
$ |
25 |
|
|
$ |
25 |
|
|
$ |
50 |
|
|
$ |
54 |
|
HOST HOTELS & RESORTS,
INC.Earnings (Loss) per Common
Share(unaudited, in millions, except per share
amounts)
|
|
Quarter endedJune 30, |
|
|
Year-to-date endedJune 30, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Net income (loss) |
|
$ |
(356 |
) |
|
$ |
290 |
|
|
$ |
(359 |
) |
|
$ |
479 |
|
Less: Net (income) loss attributable to non-controlling
interests |
|
|
4 |
|
|
|
(4 |
) |
|
|
4 |
|
|
|
(7 |
) |
Net income (loss) attributable
to Host Inc. |
|
$ |
(352 |
) |
|
$ |
286 |
|
|
$ |
(355 |
) |
|
$ |
472 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average shares
outstanding |
|
|
705.1 |
|
|
|
739.1 |
|
|
|
706.7 |
|
|
|
739.9 |
|
Assuming distribution of common shares granted under
the comprehensive stock plans, less shares
assumed purchased at market |
|
|
— |
|
|
|
.3 |
|
|
|
— |
|
|
|
.3 |
|
Diluted weighted average
shares outstanding (1) |
|
|
705.1 |
|
|
|
739.4 |
|
|
|
706.7 |
|
|
|
740.2 |
|
Basic and diluted earnings
(loss) per common share |
|
$ |
(.50 |
) |
|
$ |
.39 |
|
|
$ |
(.50 |
) |
|
$ |
.64 |
|
___________ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Dilutive securities may include shares
granted under comprehensive stock plans, preferred operating
partnership units (“OP Units”) held by minority 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 (1)(2)
All Owned Hotels (pro forma) by Location in Constant
US$
|
|
As of June 30, 2020 |
|
|
Quarter ended June 30, 2020 |
|
|
Quarter ended June 30, 2019 |
|
|
|
|
|
|
|
|
|
Location |
|
No. ofProperties |
|
|
No. ofRooms |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
PercentChange inRevPAR |
|
|
PercentChange inTotal RevPAR |
|
Florida Gulf Coast |
|
|
5 |
|
|
|
1,842 |
|
|
$ |
278.24 |
|
|
|
17.7 |
% |
|
$ |
49.11 |
|
|
$ |
87.12 |
|
|
$ |
313.53 |
|
|
|
73.9 |
% |
|
$ |
231.56 |
|
|
$ |
471.22 |
|
|
|
(78.8 |
)% |
|
|
(81.5 |
)% |
Maui/Oahu |
|
|
4 |
|
|
|
1,983 |
|
|
|
75.47 |
|
|
|
3.7 |
|
|
|
2.77 |
|
|
|
5.82 |
|
|
|
384.31 |
|
|
|
92.3 |
|
|
|
354.62 |
|
|
|
563.56 |
|
|
|
(99.2 |
) |
|
|
(99.0 |
) |
Jacksonville |
|
|
1 |
|
|
|
446 |
|
|
|
469.00 |
|
|
|
28.1 |
|
|
|
131.95 |
|
|
|
219.50 |
|
|
|
414.11 |
|
|
|
84.1 |
|
|
|
348.40 |
|
|
|
753.61 |
|
|
|
(62.1 |
) |
|
|
(70.9 |
) |
Miami |
|
|
3 |
|
|
|
1,276 |
|
|
|
276.13 |
|
|
|
8.3 |
|
|
|
22.86 |
|
|
|
39.35 |
|
|
|
299.54 |
|
|
|
80.6 |
|
|
|
241.56 |
|
|
|
390.25 |
|
|
|
(90.5 |
) |
|
|
(89.9 |
) |
Phoenix |
|
|
3 |
|
|
|
1,654 |
|
|
|
185.02 |
|
|
|
6.8 |
|
|
|
12.58 |
|
|
|
53.48 |
|
|
|
277.88 |
|
|
|
74.6 |
|
|
|
207.40 |
|
|
|
488.38 |
|
|
|
(93.9 |
) |
|
|
(89.0 |
) |
San Francisco/San Jose |
|
|
7 |
|
|
|
4,528 |
|
|
|
175.74 |
|
|
|
4.2 |
|
|
|
7.43 |
|
|
|
14.51 |
|
|
|
267.87 |
|
|
|
82.7 |
|
|
|
221.55 |
|
|
|
313.95 |
|
|
|
(96.6 |
) |
|
|
(95.4 |
) |
Los Angeles |
|
|
4 |
|
|
|
1,726 |
|
|
|
207.67 |
|
|
|
9.9 |
|
|
|
20.48 |
|
|
|
28.05 |
|
|
|
228.49 |
|
|
|
89.1 |
|
|
|
203.54 |
|
|
|
300.39 |
|
|
|
(89.9 |
) |
|
|
(90.7 |
) |
New York |
|
|
3 |
|
|
|
4,261 |
|
|
|
134.19 |
|
|
|
30.2 |
|
|
|
40.47 |
|
|
|
43.18 |
|
|
|
292.59 |
|
|
|
84.9 |
|
|
|
248.42 |
|
|
|
378.93 |
|
|
|
(83.7 |
) |
|
|
(88.6 |
) |
San Diego |
|
|
3 |
|
|
|
3,288 |
|
|
|
181.47 |
|
|
|
2.5 |
|
|
|
4.57 |
|
|
|
17.07 |
|
|
|
257.34 |
|
|
|
83.0 |
|
|
|
213.66 |
|
|
|
394.65 |
|
|
|
(97.9 |
) |
|
|
(95.7 |
) |
Atlanta |
|
|
4 |
|
|
|
1,682 |
|
|
|
138.09 |
|
|
|
9.6 |
|
|
|
13.23 |
|
|
|
18.55 |
|
|
|
188.81 |
|
|
|
76.7 |
|
|
|
144.87 |
|
|
|
232.21 |
|
|
|
(90.9 |
) |
|
|
(92.0 |
) |
Washington, D.C. (CBD) |
|
|
5 |
|
|
|
3,238 |
|
|
|
221.94 |
|
|
|
4.6 |
|
|
|
10.14 |
|
|
|
10.76 |
|
|
|
278.76 |
|
|
|
91.5 |
|
|
|
255.04 |
|
|
|
367.23 |
|
|
|
(96.0 |
) |
|
|
(97.1 |
) |
New Orleans |
|
|
1 |
|
|
|
1,333 |
|
|
|
N/M |
|
|
|
0.0 |
|
|
|
0.29 |
|
|
|
1.94 |
|
|
|
196.98 |
|
|
|
81.0 |
|
|
|
159.65 |
|
|
|
233.90 |
|
|
|
(99.8 |
) |
|
|
(99.2 |
) |
Orange County |
|
|
2 |
|
|
|
925 |
|
|
|
163.08 |
|
|
|
7.4 |
|
|
|
12.01 |
|
|
|
18.18 |
|
|
|
189.11 |
|
|
|
79.5 |
|
|
|
150.28 |
|
|
|
251.79 |
|
|
|
(92.0 |
) |
|
|
(92.8 |
) |
Orlando |
|
|
1 |
|
|
|
2,004 |
|
|
|
N/M |
|
|
|
0.1 |
|
|
|
0.05 |
|
|
|
17.24 |
|
|
|
177.39 |
|
|
|
70.7 |
|
|
|
125.33 |
|
|
|
295.11 |
|
|
|
(100.0 |
) |
|
|
(94.2 |
) |
Houston |
|
|
4 |
|
|
|
1,716 |
|
|
|
112.05 |
|
|
|
13.9 |
|
|
|
15.63 |
|
|
|
20.43 |
|
|
|
181.69 |
|
|
|
74.6 |
|
|
|
135.49 |
|
|
|
193.31 |
|
|
|
(88.5 |
) |
|
|
(89.4 |
) |
Philadelphia |
|
|
2 |
|
|
|
810 |
|
|
|
120.32 |
|
|
|
10.6 |
|
|
|
12.75 |
|
|
|
15.74 |
|
|
|
247.35 |
|
|
|
89.7 |
|
|
|
221.94 |
|
|
|
366.74 |
|
|
|
(94.3 |
) |
|
|
(95.7 |
) |
Northern Virginia |
|
|
3 |
|
|
|
1,252 |
|
|
|
129.21 |
|
|
|
7.9 |
|
|
|
10.20 |
|
|
|
15.45 |
|
|
|
214.09 |
|
|
|
77.9 |
|
|
|
166.82 |
|
|
|
280.83 |
|
|
|
(93.9 |
) |
|
|
(94.5 |
) |
Seattle |
|
|
2 |
|
|
|
1,315 |
|
|
|
196.68 |
|
|
|
1.1 |
|
|
|
2.26 |
|
|
|
5.68 |
|
|
|
234.35 |
|
|
|
85.1 |
|
|
|
199.47 |
|
|
|
271.52 |
|
|
|
(98.9 |
) |
|
|
(97.9 |
) |
Boston. |
|
|
3 |
|
|
|
2,715 |
|
|
|
N/M |
|
|
|
0.2 |
|
|
|
0.28 |
|
|
|
2.05 |
|
|
|
272.01 |
|
|
|
87.8 |
|
|
|
238.87 |
|
|
|
324.76 |
|
|
|
(99.9 |
) |
|
|
(99.4 |
) |
Denver |
|
|
3 |
|
|
|
1,340 |
|
|
|
112.47 |
|
|
|
7.9 |
|
|
|
8.87 |
|
|
|
10.96 |
|
|
|
176.07 |
|
|
|
79.4 |
|
|
|
139.88 |
|
|
|
210.69 |
|
|
|
(93.7 |
) |
|
|
(94.8 |
) |
San Antonio |
|
|
2 |
|
|
|
1,512 |
|
|
|
123.02 |
|
|
|
5.4 |
|
|
|
6.59 |
|
|
|
9.36 |
|
|
|
186.37 |
|
|
|
75.1 |
|
|
|
139.94 |
|
|
|
200.21 |
|
|
|
(95.3 |
) |
|
|
(95.3 |
) |
Chicago |
|
|
4 |
|
|
|
1,816 |
|
|
|
110.04 |
|
|
|
9.8 |
|
|
|
10.82 |
|
|
|
13.03 |
|
|
|
237.05 |
|
|
|
82.5 |
|
|
|
195.46 |
|
|
|
278.10 |
|
|
|
(94.5 |
) |
|
|
(95.3 |
) |
Other |
|
|
6 |
|
|
|
2,509 |
|
|
|
109.28 |
|
|
|
13.5 |
|
|
|
14.77 |
|
|
|
18.40 |
|
|
|
175.50 |
|
|
|
83.0 |
|
|
|
145.69 |
|
|
|
207.76 |
|
|
|
(89.9 |
) |
|
|
(91.1 |
) |
Domestic |
|
|
75 |
|
|
|
45,171 |
|
|
|
165.18 |
|
|
|
8.9 |
|
|
|
14.62 |
|
|
|
23.52 |
|
|
|
252.03 |
|
|
|
82.4 |
|
|
|
207.60 |
|
|
|
332.73 |
|
|
|
(93.0 |
) |
|
|
(92.9 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
|
5 |
|
|
|
1,499 |
|
|
|
59.79 |
|
|
|
8.4 |
|
|
|
5.02 |
|
|
|
12.44 |
|
|
|
143.72 |
|
|
|
69.7 |
|
|
|
100.16 |
|
|
|
154.14 |
|
|
|
(95.0 |
) |
|
|
(91.9 |
) |
All Locations - Constant US$ |
|
|
80 |
|
|
|
46,670 |
|
|
|
161.97 |
|
|
|
8.8 |
|
|
|
14.31 |
|
|
|
23.16 |
|
|
|
249.07 |
|
|
|
82.0 |
|
|
|
204.15 |
|
|
|
327.00 |
|
|
|
(93.0 |
) |
|
|
(92.9 |
) |
All Owned Hotels (pro forma) in Nominal US$
|
|
As of June 30, 2020 |
|
|
Quarter ended June 30, 2020 |
|
|
Quarter ended June 30, 2019 |
|
|
|
|
|
|
|
|
|
|
|
No. ofProperties |
|
|
No. ofRooms |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
PercentChange inRevPAR |
|
|
PercentChange inTotal RevPAR |
|
International |
|
|
5 |
|
|
|
1,499 |
|
|
$ |
59.79 |
|
|
|
8.4 |
% |
|
$ |
5.02 |
|
|
$ |
12.44 |
|
|
$ |
158.97 |
|
|
|
69.7 |
% |
|
$ |
110.79 |
|
|
$ |
169.04 |
|
|
|
(95.5 |
)% |
|
|
(92.6 |
)% |
Domestic |
|
|
75 |
|
|
|
45,171 |
|
|
|
165.18 |
|
|
|
8.9 |
|
|
|
14.62 |
|
|
|
23.52 |
|
|
|
252.03 |
|
|
|
82.4 |
|
|
|
207.60 |
|
|
|
332.73 |
|
|
|
(93.0 |
) |
|
|
(92.9 |
) |
All Locations |
|
|
80 |
|
|
|
46,670 |
|
|
|
161.97 |
|
|
|
8.8 |
|
|
|
14.31 |
|
|
|
23.16 |
|
|
|
249.49 |
|
|
|
82.0 |
|
|
|
204.49 |
|
|
|
327.47 |
|
|
|
(93.0 |
) |
|
|
(92.9 |
) |
All Owned Hotels (pro forma) by Location in Constant
US$
|
|
As of June 30, 2020 |
|
|
Year-to-date ended June 30, 2020 |
|
|
Year-to-date ended June 30, 2019 |
|
|
|
|
|
|
|
|
|
Location |
|
No. ofProperties |
|
|
No. ofRooms |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
PercentChange inRevPAR |
|
|
PercentChange inTotal RevPAR |
|
Florida Gulf Coast |
|
|
5 |
|
|
|
1,842 |
|
|
$ |
400.35 |
|
|
|
44.2 |
% |
|
$ |
177.03 |
|
|
$ |
353.01 |
|
|
$ |
379.76 |
|
|
|
78.4 |
% |
|
$ |
297.90 |
|
|
$ |
586.44 |
|
|
|
(40.6 |
)% |
|
|
(39.8 |
)% |
Maui/Oahu |
|
|
4 |
|
|
|
1,983 |
|
|
|
451.32 |
|
|
|
39.1 |
|
|
|
176.41 |
|
|
|
259.64 |
|
|
|
410.35 |
|
|
|
90.6 |
|
|
|
371.89 |
|
|
|
573.91 |
|
|
|
(52.6 |
) |
|
|
(54.8 |
) |
Jacksonville |
|
|
1 |
|
|
|
446 |
|
|
|
398.29 |
|
|
|
42.6 |
|
|
|
169.62 |
|
|
|
342.83 |
|
|
|
391.86 |
|
|
|
81.4 |
|
|
|
318.88 |
|
|
|
722.04 |
|
|
|
(46.8 |
) |
|
|
(52.5 |
) |
Miami |
|
|
3 |
|
|
|
1,276 |
|
|
|
425.83 |
|
|
|
39.6 |
|
|
|
168.56 |
|
|
|
268.97 |
|
|
|
355.53 |
|
|
|
83.2 |
|
|
|
295.96 |
|
|
|
455.82 |
|
|
|
(43.0 |
) |
|
|
(41.0 |
) |
Phoenix |
|
|
3 |
|
|
|
1,654 |
|
|
|
352.56 |
|
|
|
37.0 |
|
|
|
130.34 |
|
|
|
303.21 |
|
|
|
327.86 |
|
|
|
78.6 |
|
|
|
257.82 |
|
|
|
566.03 |
|
|
|
(49.4 |
) |
|
|
(46.4 |
) |
San Francisco/San Jose |
|
|
7 |
|
|
|
4,528 |
|
|
|
287.40 |
|
|
|
31.8 |
|
|
|
91.26 |
|
|
|
134.44 |
|
|
|
286.10 |
|
|
|
80.0 |
|
|
|
228.99 |
|
|
|
322.35 |
|
|
|
(60.1 |
) |
|
|
(58.3 |
) |
Los Angeles |
|
|
4 |
|
|
|
1,726 |
|
|
|
215.97 |
|
|
|
39.3 |
|
|
|
84.80 |
|
|
|
124.95 |
|
|
|
226.22 |
|
|
|
87.8 |
|
|
|
198.59 |
|
|
|
294.83 |
|
|
|
(57.3 |
) |
|
|
(57.6 |
) |
New York |
|
|
3 |
|
|
|
4,261 |
|
|
|
190.39 |
|
|
|
43.1 |
|
|
|
82.11 |
|
|
|
120.16 |
|
|
|
266.94 |
|
|
|
78.5 |
|
|
|
209.56 |
|
|
|
323.62 |
|
|
|
(60.8 |
) |
|
|
(62.9 |
) |
San Diego |
|
|
3 |
|
|
|
3,288 |
|
|
|
241.83 |
|
|
|
31.8 |
|
|
|
77.01 |
|
|
|
154.12 |
|
|
|
255.23 |
|
|
|
80.0 |
|
|
|
204.18 |
|
|
|
372.23 |
|
|
|
(62.3 |
) |
|
|
(58.6 |
) |
Atlanta |
|
|
4 |
|
|
|
1,682 |
|
|
|
185.37 |
|
|
|
36.3 |
|
|
|
67.36 |
|
|
|
107.33 |
|
|
|
208.09 |
|
|
|
76.7 |
|
|
|
159.65 |
|
|
|
252.43 |
|
|
|
(57.8 |
) |
|
|
(57.5 |
) |
Washington, D.C. (CBD) |
|
|
5 |
|
|
|
3,238 |
|
|
|
229.66 |
|
|
|
29.3 |
|
|
|
67.21 |
|
|
|
97.24 |
|
|
|
265.11 |
|
|
|
82.5 |
|
|
|
218.62 |
|
|
|
312.73 |
|
|
|
(69.3 |
) |
|
|
(68.9 |
) |
New Orleans |
|
|
1 |
|
|
|
1,333 |
|
|
|
202.76 |
|
|
|
32.6 |
|
|
|
66.19 |
|
|
|
99.87 |
|
|
|
203.37 |
|
|
|
81.3 |
|
|
|
165.38 |
|
|
|
241.84 |
|
|
|
(60.0 |
) |
|
|
(58.7 |
) |
Orange County |
|
|
2 |
|
|
|
925 |
|
|
|
193.61 |
|
|
|
32.9 |
|
|
|
63.66 |
|
|
|
110.25 |
|
|
|
195.04 |
|
|
|
79.2 |
|
|
|
154.54 |
|
|
|
260.36 |
|
|
|
(58.8 |
) |
|
|
(57.7 |
) |
Orlando |
|
|
1 |
|
|
|
2,004 |
|
|
|
215.19 |
|
|
|
28.6 |
|
|
|
61.54 |
|
|
|
152.85 |
|
|
|
193.57 |
|
|
|
74.8 |
|
|
|
144.76 |
|
|
|
339.92 |
|
|
|
(57.5 |
) |
|
|
(55.0 |
) |
Houston |
|
|
4 |
|
|
|
1,716 |
|
|
|
163.52 |
|
|
|
37.6 |
|
|
|
61.51 |
|
|
|
91.53 |
|
|
|
182.15 |
|
|
|
75.2 |
|
|
|
136.92 |
|
|
|
197.16 |
|
|
|
(55.1 |
) |
|
|
(53.6 |
) |
Philadelphia |
|
|
2 |
|
|
|
810 |
|
|
|
165.99 |
|
|
|
36.7 |
|
|
|
60.90 |
|
|
|
98.18 |
|
|
|
220.90 |
|
|
|
83.9 |
|
|
|
185.41 |
|
|
|
304.83 |
|
|
|
(67.2 |
) |
|
|
(67.8 |
) |
Northern Virginia |
|
|
3 |
|
|
|
1,252 |
|
|
|
196.57 |
|
|
|
30.3 |
|
|
|
59.55 |
|
|
|
98.07 |
|
|
|
212.31 |
|
|
|
71.8 |
|
|
|
152.53 |
|
|
|
260.36 |
|
|
|
(61.0 |
) |
|
|
(62.3 |
) |
Seattle |
|
|
2 |
|
|
|
1,315 |
|
|
|
193.49 |
|
|
|
27.6 |
|
|
|
53.38 |
|
|
|
77.51 |
|
|
|
215.31 |
|
|
|
81.3 |
|
|
|
174.95 |
|
|
|
237.90 |
|
|
|
(69.5 |
) |
|
|
(67.4 |
) |
Boston |
|
|
3 |
|
|
|
2,715 |
|
|
|
176.94 |
|
|
|
26.6 |
|
|
|
47.06 |
|
|
|
71.97 |
|
|
|
236.19 |
|
|
|
78.6 |
|
|
|
185.74 |
|
|
|
260.95 |
|
|
|
(74.7 |
) |
|
|
(72.4 |
) |
Denver |
|
|
3 |
|
|
|
1,340 |
|
|
|
154.85 |
|
|
|
29.0 |
|
|
|
44.89 |
|
|
|
68.03 |
|
|
|
169.71 |
|
|
|
72.1 |
|
|
|
122.41 |
|
|
|
184.62 |
|
|
|
(63.3 |
) |
|
|
(63.2 |
) |
San Antonio |
|
|
2 |
|
|
|
1,512 |
|
|
|
179.31 |
|
|
|
24.2 |
|
|
|
43.38 |
|
|
|
65.75 |
|
|
|
191.24 |
|
|
|
76.2 |
|
|
|
145.81 |
|
|
|
215.02 |
|
|
|
(70.3 |
) |
|
|
(69.4 |
) |
Chicago |
|
|
4 |
|
|
|
1,816 |
|
|
|
136.92 |
|
|
|
28.7 |
|
|
|
39.26 |
|
|
|
54.32 |
|
|
|
199.76 |
|
|
|
71.5 |
|
|
|
142.77 |
|
|
|
203.93 |
|
|
|
(72.5 |
) |
|
|
(73.4 |
) |
Other |
|
|
6 |
|
|
|
2,509 |
|
|
|
155.53 |
|
|
|
35.4 |
|
|
|
55.07 |
|
|
|
76.39 |
|
|
|
172.13 |
|
|
|
78.1 |
|
|
|
134.38 |
|
|
|
191.51 |
|
|
|
(59.0 |
) |
|
|
(60.1 |
) |
Domestic |
|
|
75 |
|
|
|
45,171 |
|
|
|
242.02 |
|
|
|
34.0 |
|
|
|
82.19 |
|
|
|
136.94 |
|
|
|
254.20 |
|
|
|
79.3 |
|
|
|
201.52 |
|
|
|
324.88 |
|
|
|
(59.2 |
) |
|
|
(57.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International |
|
|
5 |
|
|
|
1,499 |
|
|
|
127.54 |
|
|
|
30.9 |
|
|
|
39.36 |
|
|
|
59.43 |
|
|
|
139.27 |
|
|
|
68.7 |
|
|
|
95.64 |
|
|
|
143.57 |
|
|
|
(58.8 |
) |
|
|
(58.6 |
) |
All Locations - Constant US$ |
|
|
80 |
|
|
|
46,670 |
|
|
|
238.67 |
|
|
|
33.9 |
|
|
|
80.81 |
|
|
|
134.46 |
|
|
|
250.99 |
|
|
|
78.9 |
|
|
|
198.12 |
|
|
|
319.06 |
|
|
|
(59.2 |
) |
|
|
(57.9 |
) |
All Owned Hotels (pro forma) in Nominal US$
|
|
As of June 30, 2020 |
|
|
Year-to-date ended June 30, 2020 |
|
|
Year-to-date ended June 30, 2019 |
|
|
|
|
|
|
|
|
|
|
|
No. ofProperties |
|
|
No. ofRooms |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
AverageRoom Rate |
|
|
AverageOccupancyPercentage |
|
|
RevPAR |
|
|
Total RevPAR |
|
|
PercentChange inRevPAR |
|
|
PercentChange inTotal RevPAR |
|
International |
|
|
5 |
|
|
|
1,499 |
|
|
$ |
127.54 |
|
|
|
30.9 |
% |
|
$ |
39.36 |
|
|
$ |
59.43 |
|
|
$ |
151.58 |
|
|
|
68.7 |
% |
|
$ |
104.09 |
|
|
$ |
155.00 |
|
|
|
(62.2 |
)% |
|
|
(61.7 |
)% |
Domestic |
|
|
75 |
|
|
|
45,171 |
|
|
|
242.02 |
|
|
|
34.0 |
|
|
|
82.19 |
|
|
|
136.94 |
|
|
|
254.20 |
|
|
|
79.3 |
|
|
|
201.52 |
|
|
|
324.88 |
|
|
|
(59.2 |
) |
|
|
(57.8 |
) |
All Locations |
|
|
80 |
|
|
|
46,670 |
|
|
|
238.67 |
|
|
|
33.9 |
|
|
|
80.81 |
|
|
|
134.46 |
|
|
|
251.33 |
|
|
|
78.9 |
|
|
|
198.39 |
|
|
|
319.43 |
|
|
|
(59.3 |
) |
|
|
(57.9 |
) |
___________
(1) To facilitate a quarter-to-quarter
comparison of our operations, we typically present certain
operating statistics and operating results for the periods included
in this presentation on a comparable hotel basis. However, due to
the COVID-19 pandemic and its effects on operations there is little
comparability between periods. For this reason, we are revising our
presentation to instead present hotel operating results for all
consolidated hotels and, to facilitate comparisons between periods,
we are presenting results on a pro forma basis including the
following adjustments: (1) operating results are presented for all
consolidated properties owned as of June 30, 2020 but do not
include the results of operations for properties sold in 2019; and
(2) operating results for acquisitions in the current and prior
year are reflected for full calendar years, 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. See the Notes to Financial Information – All Owned
Hotel Operating Statistics and Results for further information on
these pro forma statistics and – Constant US$ and Nominal US$ for a
discussion on constant US$ presentation. Nominal US$ results
include the effect of currency fluctuations, consistent with our
financial statement presentation. CBD of a location refers to the
central business district.(2) 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.N/M = Not
meaningful
HOST HOTELS & RESORTS,
INC. Schedule of All Owned Hotel
Pro Forma Results (1)(unaudited, in millions, except hotel
statistics)
|
|
Quarter ended June 30, |
|
|
Year-to-date ended June 30, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Number of hotels |
|
|
80 |
|
|
|
80 |
|
|
|
80 |
|
|
|
80 |
|
Number of rooms |
|
|
46,670 |
|
|
|
46,670 |
|
|
|
46,670 |
|
|
|
46,670 |
|
Change in hotel Total RevPAR
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant US$ |
|
|
(92.9 |
)% |
|
|
— |
|
|
|
(57.9 |
)% |
|
|
— |
|
Nominal US$ |
|
|
(92.9 |
)% |
|
|
— |
|
|
|
(57.9 |
)% |
|
|
— |
|
Change in hotel RevPAR - |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Constant US$ |
|
|
(93.0 |
)% |
|
|
— |
|
|
|
(59.2 |
)% |
|
|
— |
|
Nominal US$ |
|
|
(93.0 |
)% |
|
|
— |
|
|
|
(59.3 |
)% |
|
|
— |
|
Operating profit (loss) margin
(2) |
|
|
(342.7 |
)% |
|
|
18.9 |
% |
|
|
(31.5 |
)% |
|
|
17.3 |
% |
All Owned Hotel Pro Forma
EBITDA margin (2) |
|
|
(155.3 |
)% |
|
|
31.9 |
% |
|
|
1.6 |
% |
|
|
31.2 |
% |
Food and beverage profit
margin (2) |
|
|
(254.5 |
)% |
|
|
35.4 |
% |
|
|
16.7 |
% |
|
|
34.8 |
% |
All Owned Hotel Pro Forma food
and beverage profit margin (2) |
|
|
(254.5 |
)% |
|
|
35.6 |
% |
|
|
16.7 |
% |
|
|
34.9 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) |
|
$ |
(356 |
) |
|
$ |
290 |
|
|
$ |
(359 |
) |
|
$ |
479 |
|
Depreciation and
amortization |
|
|
168 |
|
|
|
166 |
|
|
|
332 |
|
|
|
336 |
|
Interest expense |
|
|
40 |
|
|
|
43 |
|
|
|
77 |
|
|
|
86 |
|
Provision (benefit) for income
taxes |
|
|
(46 |
) |
|
|
16 |
|
|
|
(83 |
) |
|
|
18 |
|
Gain on sale of property and
corporate level income/expense |
|
|
34 |
|
|
|
(44 |
) |
|
|
51 |
|
|
|
(33 |
) |
Pro forma adjustments(3) |
|
|
— |
|
|
|
(25 |
) |
|
|
— |
|
|
|
(40 |
) |
All Owned Hotel Pro
Forma EBITDA |
|
$ |
(160 |
) |
|
$ |
446 |
|
|
$ |
18 |
|
|
$ |
846 |
|
|
|
Quarter ended June 30, 2020 |
|
|
Quarter ended June 30, 2019 |
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
GAAP Results |
|
|
Depreciation and corporate level items |
|
|
All Owned Hotel Pro Forma Results (3) |
|
|
GAAP Results |
|
|
Pro forma adjustments(3) |
|
|
Depreciation and corporate level items |
|
|
All Owned Hotel Pro Forma Results (3) |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room |
|
$ |
61 |
|
|
$ |
— |
|
|
$ |
61 |
|
|
$ |
931 |
|
|
|
(62 |
) |
|
$ |
— |
|
|
$ |
869 |
|
Food and beverage |
|
|
11 |
|
|
|
— |
|
|
|
11 |
|
|
|
449 |
|
|
|
(19 |
) |
|
|
— |
|
|
|
430 |
|
Other |
|
|
31 |
|
|
|
— |
|
|
|
31 |
|
|
|
103 |
|
|
|
(4 |
) |
|
|
— |
|
|
|
99 |
|
Total revenues |
|
|
103 |
|
|
|
— |
|
|
|
103 |
|
|
|
1,483 |
|
|
|
(85 |
) |
|
|
— |
|
|
|
1,398 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room |
|
|
43 |
|
|
|
— |
|
|
|
43 |
|
|
|
226 |
|
|
|
(14 |
) |
|
|
— |
|
|
|
212 |
|
Food and beverage |
|
|
39 |
|
|
|
— |
|
|
|
39 |
|
|
|
290 |
|
|
|
(13 |
) |
|
|
— |
|
|
|
277 |
|
Other |
|
|
181 |
|
|
|
— |
|
|
|
181 |
|
|
|
496 |
|
|
|
(33 |
) |
|
|
— |
|
|
|
463 |
|
Depreciation and amortization |
|
|
168 |
|
|
|
(168 |
) |
|
|
— |
|
|
|
166 |
|
|
|
— |
|
|
|
(166 |
) |
|
|
— |
|
Corporate and other expenses |
|
|
25 |
|
|
|
(25 |
) |
|
|
— |
|
|
|
25 |
|
|
|
— |
|
|
|
(25 |
) |
|
|
— |
|
Total expenses |
|
|
456 |
|
|
|
(193 |
) |
|
|
263 |
|
|
|
1,203 |
|
|
|
(60 |
) |
|
|
(191 |
) |
|
|
952 |
|
Operating Profit
(Loss) - All Owned Hotel Pro Forma EBITDA |
|
$ |
(353 |
) |
|
$ |
193 |
|
|
$ |
(160 |
) |
|
$ |
280 |
|
|
$ |
(25 |
) |
|
$ |
191 |
|
|
$ |
446 |
|
|
|
Year-to-date ended June 30, 2020 |
|
|
Year-to-date ended June 30, 2019 |
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
|
|
|
Adjustments |
|
|
|
|
|
|
|
GAAP Results |
|
|
Depreciation and corporate level items |
|
|
All Owned Hotel Pro Forma Results (3) |
|
|
GAAP Results |
|
|
Pro forma adjustments(3) |
|
|
Depreciation and corporate level items |
|
|
All Owned Hotel Pro Forma Results (3) |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room |
|
$ |
687 |
|
|
$ |
— |
|
|
$ |
687 |
|
|
$ |
1,788 |
|
|
$ |
(111 |
) |
|
$ |
— |
|
|
$ |
1,677 |
|
Food and beverage |
|
|
341 |
|
|
|
— |
|
|
|
341 |
|
|
|
882 |
|
|
|
(39 |
) |
|
|
— |
|
|
|
843 |
|
Other |
|
|
127 |
|
|
|
— |
|
|
|
127 |
|
|
|
203 |
|
|
|
(11 |
) |
|
|
— |
|
|
|
192 |
|
Total revenues |
|
|
1,155 |
|
|
|
— |
|
|
|
1,155 |
|
|
|
2,873 |
|
|
|
(161 |
) |
|
|
— |
|
|
|
2,712 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room |
|
|
230 |
|
|
|
— |
|
|
|
230 |
|
|
|
443 |
|
|
|
(28 |
) |
|
|
— |
|
|
|
415 |
|
Food and beverage |
|
|
284 |
|
|
|
— |
|
|
|
284 |
|
|
|
575 |
|
|
|
(26 |
) |
|
|
— |
|
|
|
549 |
|
Other |
|
|
623 |
|
|
|
— |
|
|
|
623 |
|
|
|
969 |
|
|
|
(67 |
) |
|
|
— |
|
|
|
902 |
|
Depreciation and amortization |
|
|
332 |
|
|
|
(332 |
) |
|
|
— |
|
|
|
336 |
|
|
|
— |
|
|
|
(336 |
) |
|
|
— |
|
Corporate and other expenses |
|
|
50 |
|
|
|
(50 |
) |
|
|
— |
|
|
|
54 |
|
|
|
— |
|
|
|
(54 |
) |
|
|
— |
|
Total expenses |
|
|
1,519 |
|
|
|
(382 |
) |
|
|
1,137 |
|
|
|
2,377 |
|
|
|
(121 |
) |
|
|
(390 |
) |
|
|
1,866 |
|
Operating Profit
(Loss) - All Owned Hotel Pro Forma EBITDA |
|
$ |
(364 |
) |
|
$ |
382 |
|
|
$ |
18 |
|
|
$ |
496 |
|
|
$ |
(40 |
) |
|
$ |
390 |
|
|
$ |
846 |
|
|
|
April |
|
|
May |
|
|
June |
|
|
Quarter endedJune 30, 2020 |
|
Net loss |
|
$ |
(120 |
) |
|
$ |
(114 |
) |
|
$ |
(122 |
) |
|
$ |
(356 |
) |
Depreciation and
amortization |
|
|
54 |
|
|
|
56 |
|
|
|
58 |
|
|
|
168 |
|
Interest expense |
|
|
14 |
|
|
|
13 |
|
|
|
13 |
|
|
|
40 |
|
Benefit for income taxes |
|
|
(8 |
) |
|
|
(16 |
) |
|
|
(22 |
) |
|
|
(46 |
) |
Gain on sale of property and
corporate level income/expense |
|
|
7 |
|
|
|
11 |
|
|
|
16 |
|
|
|
34 |
|
All Owned Hotel Pro
Forma EBITDA |
|
|
(53 |
) |
|
|
(50 |
) |
|
|
(57 |
) |
|
|
(160 |
) |
Benefits for furloughed
employees adjustment |
|
|
(20 |
) |
|
|
(3 |
) |
|
|
20 |
|
|
|
(3 |
) |
Hotel-level operating
loss (1) |
|
$ |
(73 |
) |
|
$ |
(53 |
) |
|
$ |
(37 |
) |
|
$ |
(163 |
) |
(1) See the Notes to Financial Information for a
discussion of non-GAAP measures and the calculation of all owned
hotel pro forma results and hotel-level operating loss, including
the limitations on their use. For additional information on hotel
EBITDA by location, see the Second Quarter 2020 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 condensed consolidated statements of
operations. Hotel margins are calculated using amounts presented in
the above tables. (3) Pro forma adjustments represent the following
items: (i) the elimination of results of operations of our
sold hotels, which operations are included in our condensed
consolidated statements of operations as continuing operations and
(ii) the addition of results for periods prior to our ownership for
hotels acquired during the presented periods. For this
presentation, we no longer adjust for certain items such
as gains on insurance settlements, the results of our leased
office buildings and other non-hotel revenue and expense items, and
they are included in the All Owned Hotel Pro Forma results.
HOST HOTELS & RESORTS,
INC.Reconciliation of Net Income (Loss)
toEBITDA, EBITDAre and Adjusted EBITDAre
(1)(unaudited, in millions)
|
|
Quarter endedJune 30, |
|
|
Year-to-date endedJune 30, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Net income (loss) (2) |
|
$ |
(356 |
) |
|
$ |
290 |
|
|
$ |
(359 |
) |
|
$ |
479 |
|
Interest expense |
|
|
40 |
|
|
|
43 |
|
|
|
77 |
|
|
|
86 |
|
Depreciation and amortization |
|
|
168 |
|
|
|
166 |
|
|
|
332 |
|
|
|
336 |
|
Income taxes |
|
|
(46 |
) |
|
|
16 |
|
|
|
(83 |
) |
|
|
18 |
|
EBITDA(2) |
|
|
(194 |
) |
|
|
515 |
|
|
|
(33 |
) |
|
|
919 |
|
Gain on dispositions (3) |
|
|
(1 |
) |
|
|
(57 |
) |
|
|
— |
|
|
|
(59 |
) |
Equity investment adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in (earnings) losses of affiliates |
|
|
25 |
|
|
|
(4 |
) |
|
|
21 |
|
|
|
(9 |
) |
Pro rata EBITDAre of equity investments |
|
|
(20 |
) |
|
|
6 |
|
|
|
(14 |
) |
|
|
16 |
|
EBITDAre and Adjusted
EBITDAre (2) |
|
$ |
(190 |
) |
|
$ |
460 |
|
|
$ |
(26 |
) |
|
$ |
867 |
|
___________ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) See the Notes to Financial Information for
discussion of non-GAAP measures.(2) Net income (loss), EBITDA,
EBITDAre, Adjusted EBITDAre, NAREIT FFO and Adjusted FFO for the
quarter ended June 30, 2020 include a gain of $12 million from the
sale of land adjacent to The Phoenician and a loss of $14 million
related to inventory impairment expense recorded by our Maui
timeshare joint venture, reflected through equity in (earnings)
losses of affiliates. (3) Reflects the sale of four hotels in
2019.
HOST HOTELS & RESORTS,
INC.Reconciliation of Diluted Earnings (Loss) per
Common Share toNAREIT and Adjusted Funds From
Operations per Diluted Share
(1)(unaudited, in millions, except per share
amounts)
|
|
Quarter endedJune 30, |
|
|
Year-to-date endedJune 30, |
|
|
|
2020 |
|
|
2019 |
|
|
2020 |
|
|
2019 |
|
Net income (loss) (2) |
|
$ |
(356 |
) |
|
$ |
290 |
|
|
$ |
(359 |
) |
|
$ |
479 |
|
Less: Net (income) loss attributable to non-controlling interests |
|
|
4 |
|
|
|
(4 |
) |
|
|
4 |
|
|
|
(7 |
) |
Net income (loss)
attributable to Host Inc. |
|
|
(352 |
) |
|
|
286 |
|
|
|
(355 |
) |
|
|
472 |
|
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain on dispositions (3) |
|
|
(1 |
) |
|
|
(57 |
) |
|
|
— |
|
|
|
(59 |
) |
Depreciation and amortization |
|
|
166 |
|
|
|
165 |
|
|
|
331 |
|
|
|
334 |
|
Equity investment adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in (earnings) losses of affiliates |
|
|
25 |
|
|
|
(4 |
) |
|
|
21 |
|
|
|
(9 |
) |
Pro rata FFO of equity investments |
|
|
(20 |
) |
|
|
4 |
|
|
|
(17 |
) |
|
|
13 |
|
Consolidated partnership adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FFO adjustment for non-controlling partnerships |
|
|
— |
|
|
|
— |
|
|
|
(1 |
) |
|
|
1 |
|
FFO adjustments for non-controlling interests of
Host L.P. |
|
|
(2 |
) |
|
|
(1 |
) |
|
|
(3 |
) |
|
|
(3 |
) |
NAREIT FFO
(2) |
|
|
(184 |
) |
|
|
393 |
|
|
|
(24 |
) |
|
|
749 |
|
Adjustments to NAREIT
FFO: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on debt extinguishment |
|
|
1 |
|
|
|
— |
|
|
|
1 |
|
|
|
— |
|
Adjusted FFO
(2) |
|
$ |
(183 |
) |
|
$ |
393 |
|
|
$ |
(23 |
) |
|
$ |
749 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For calculation on a
per share basis (4): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding - EPS, NAREIT FFO and Adjusted
FFO |
|
|
705.1 |
|
|
|
739.4 |
|
|
|
706.7 |
|
|
|
740.2 |
|
Diluted earnings
(loss) per common share |
|
$ |
(.50 |
) |
|
$ |
.39 |
|
|
$ |
(.50 |
) |
|
$ |
.64 |
|
NAREIT FFO and
Adjusted FFO per diluted share |
|
$ |
(.26 |
) |
|
$ |
.53 |
|
|
$ |
(.03 |
) |
|
$ |
1.01 |
|
___________ |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1-3) Refer to the corresponding footnote on the
Reconciliation of Net Income (Loss) to EBITDA, EBITDAre and
Adjusted EBITDAre.(4) Diluted earnings (loss) 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 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.Notes to Financial
Information
ALL OWNED HOTEL OPERATING
STATISTICS AND RESULTS
To facilitate a quarter-to-quarter comparison of
our operations, we typically present certain operating statistics
and operating results for the periods included in this presentation
on a comparable hotel basis (discussed in “Comparable Hotel
Operating Statistics” below). However, due to the COVID-19 pandemic
and its effects on operations there is little comparability between
periods. For this reason, we are temporarily suspending our
comparable hotel presentation and instead present hotel operating
results for all consolidated hotels and, to facilitate comparisons
between periods, we are presenting results on a pro forma basis,
including the following adjustments: (1) operating results are
presented for all consolidated hotels owned as of June 30,
2020, but do not include the results of operations for properties
sold in 2019; and (2) operating results for acquisitions in the
current and prior year are reflected for full calendar years, 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.
COMPARABLE HOTEL OPERATING
STATISTICS
The following discusses our typical presentation
of comparable hotels; however, this method is not being used in the
current presentation due to the impact of COVID-19:
To facilitate a quarter-to-quarter comparison of
our operations, we typically 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 this report on
a comparable hotel basis in order to enable our investors to better
evaluate our operating performance.
We define our comparable hotels as those:
(i) that are
owned or leased by us at the end of the reporting periods being
compared; and
(ii) that have
not sustained substantial property damage or business interruption,
or undergone large-scale capital projects (as further defined
below) during the reporting periods being compared.
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 that would cause a hotel to be excluded from our comparable
hotel set is an extensive renovation of several core aspects of the
hotel, such as rooms, meeting space, lobby, bars, restaurants and
other public spaces. Both quantitative and qualitative factors are
taken into consideration in determining if the renovation would
cause a hotel to be removed from the comparable hotel set,
including unusual or exceptional circumstances such as: a reduction
or increase in room count, rebranding, a significant alteration of
the business operations, or the closing of the hotel during the
renovation.
Historically, we have not included an acquired
hotel in our comparable hotel set until the operating results for
that hotel have been included in our consolidated results for one
full calendar year. For example, we acquired the 1 Hotel South
Beach in February 2019 and therefore it was not included in our
comparable hotels for 2019. We are, however, making a change to
this policy going forward, which is explained below under “2020
Comparable Hotel Definition Change.”
Hotels that we sell are excluded from the
comparable hotel set once the transaction has closed. Similarly,
hotels are excluded from our comparable hotel set from the date
that they sustain substantial property damage or business
interruption or commence a large-scale capital project. 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 completion of the repair
of the property damage or cessation of the business interruption,
or the completion of large-scale capital projects, as
applicable.
2020 Comparable Hotel Definition Change
Effective January 1, 2020, the Company adjusted
its definition of comparable hotels to include recent acquisitions
on a pro forma basis assuming they have comparable operating
environments. Operating results for acquisitions in the current and
prior year will be reflected for full calendar years, to include
results for periods prior to Company ownership. Management believes
this will provide investors a better understanding of underlying
growth trends for the Company’s current portfolio. As a result, the
1 Hotel South Beach would be included in the comparable hotel set
for 2020.
CONSTANT US$ AND NOMINAL
US$
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. For comparative purposes, we
also present the RevPAR results for the prior year assuming the
results of our foreign operations were translated using the same
exchange rates that were effective for the comparable periods in
the current year, thereby eliminating the effect of currency
fluctuation for the year-over-year comparisons. We believe this
presentation is useful to investors as it provides clarity with
respect to growth in RevPAR in the local currency of the hotel
consistent with the way we would evaluate our domestic portfolio.
However, the estimated effect of changes in foreign currency has
been reflected in the results of net income (loss), EBITDA,
Adjusted EBITDAre, diluted earnings (loss) per common share and
Adjusted FFO per diluted share. Nominal US$ results 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, (iv) All Owned
Hotel Property Level Operating Results (v) Hotel-level operating
loss and (vi) Cash burn. 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. Effective January 1, 2019, we adopted NAREIT’s
definition of FFO included 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 real estate, gains and losses from the sale
of certain real estate assets, gains and losses from change in
control, impairment write-downs 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 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 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 outside the ordinary course of
business. We believe that including these items is not consistent
with our ongoing operating performance.
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 the 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 on-going operating performance and,
therefore, 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 write-downs of 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
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 outside the ordinary course of
business. We believe that including these items is not consistent
with our ongoing operating performance.
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 such adjustment 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 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 FFO or do not calculate FFO per
diluted share in accordance with NAREIT guidance. In addition,
although FFO per diluted share is a useful measure when comparing
our results to other REITs, it may not be helpful to investors when
comparing us to non-REITs. We also calculate Adjusted FFO per
diluted share, which is not in accordance with NAREIT guidance and
may not be comparable to measures calculated by other REITs.
EBITDA, EBITDAre and Adjusted EBITDAre, as presented, may also not
be comparable to measures calculated 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) 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 quarterly report on Form
10-Q (“Statements of Cash Flows”) 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 a
measure 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 a measure
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
seven domestic and international partnerships that own a total of
10 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 outside partners, and a
15% interest held by outside partners 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.
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 hotel-level pro forma
basis as supplemental information for our investors. Our hotel
results reflect the operating results of our hotels as discussed in
“All Owned Hotel Operating Statistics and Results” above. We
present all owned hotel pro forma EBITDA to help 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 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 hotels. All owned hotel pro forma results are
presented both by location and for the Company’s properties in the
aggregate. We 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 have
historically 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 and depreciation
and amortization expense, the 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 consolidated statements of operations include such
amounts, all of which should be considered by investors when
evaluating our performance.
While management believes that presentation of
all owned hotel results is a 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 these hotels, as these decisions are based
on data for individual hotels and are not based on all owned hotel
results in the aggregate. For these reasons, we believe all owned
hotel operating results, when combined with the presentation of
GAAP operating profit, revenues and expenses, provide useful
information to investors and management.
COVID-19 Non-GAAP Reporting Measures
Hotel-level Operating
Loss. We present hotel-level operating loss because
management believes this metric is helpful to investors to evaluate
the monthly operating performance of our properties during the
COVID-19 pandemic. We further adjust All Owned Hotel Pro Forma
EBITDA to reflect the benefits for furloughed employees in the
month that they are provided to the employees of our properties,
replacing the related GAAP expense accrual. While furlough costs
may arise in various situations, the furlough costs incurred during
the COVID-19 pandemic are unusually large and not reflective of how
wages and benefits are generally accrued and paid, therefore
management adjusts All Owned Hotel Pro Forma EBITDA to include the
furlough costs based on the timing that they are provided to the
employees to better reflect monthly costs and evaluate the hotel
performance. We accrue for the anticipated furlough costs when our
hotel managers have committed to the continuation of these benefits
regardless of the timing of the benefits. For example, in March
2020 we accrued $35 million for April and May benefits for
furloughed employees at our Marriott- and Hyatt-managed hotels. In
June 2020, we accrued $32 million for the July, August and
September benefits for our Marriott-managed hotels. As a result,
our GAAP operating results reflect the timing of the commitment
rather than the actual month of the benefits. While the net impact
of the accrual is not significant in the evaluation of our hotel
operations on a quarterly basis, we adjust for the timing of the
accrual on a monthly basis to include the expense in the month that
the furlough benefits are provided in order to evaluate the
month-to-month changes in operating results at our properties
exclusive of the timing of the accrual. Hotel-level operating loss
is not intended to be, and should not be used as, a substitute for
GAAP net income (loss). Because of the elimination of
corporate-level costs and expenses, gains or losses on disposition
and depreciation and amortization expense, the hotel-level monthly
operating results we present do not represent our total operating
results 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 consolidated statements of operations include such
amounts, all of which should be considered by investors when
evaluating our performance.
Cash Burn. We present cash
burn because management believes this metric is helpful to
investors to evaluate the company's ability to continue to fund
operations during periods where hotels have suspended operations or
are operating at very low levels of occupancy due to the COVID-19
pandemic. The Company defines cash burn as net cash from operating
activities adjusted for (i) capital expenditures, (ii) changes in
short term assets and liabilities and (iii) contributions to equity
investments, as further described below. Cash burn is not intended
to be, and should not be used as a substitute for GAAP cash flow as
it does not reflect the issuance or repurchase of equity,
dividends, issuance or repayment of debt, or other investing
activities such as the purchase or sale of properties. Adjustments
include:
- Capital Expenditures – Capital
expenditures are included in the overall cash burn as they
represent a significant on-going cash outflow of the Company. While
management continually evaluates its capital expenditure program to
appropriately balance improving and renewing its hotel portfolio
with its overall cash needs; management continues to anticipate
capital expenditures to be a significant cash outflow.
- Changes in short term assets and
liabilities – The Company eliminates changes in short-term assets
and liabilities, including due from managers, other assets and
other liabilities, that primarily represent timing of cash inflows
and outflows. As a result, cash burn includes income and expenses
in better alignment with how these items are reflected on the
statement of operations. These generally represent receipts and
payments that will be settled within the year and do not reflect
the cash savings or liquidity needs of the Company on an on-going
basis.
- Contributions to equity investments
– The Company includes contributions to equity investments that
have been necessary due to the depressed operations for these
investments during the COVID-19 pandemic. These are included as
investing activities on the Statements of Cash Flows.
The following presents the reconciliation of our
second quarter cash used in operating activities per our Statements
of Cash Flows to cash burn (in millions):
|
|
Quarter ended June 30, 2020 |
|
GAAP net cash used in operating activities |
|
$ |
(172 |
) |
|
|
|
|
|
Capital expenditures |
|
|
(169 |
) |
Contributions to equity
investments |
|
|
(1 |
) |
Timing adjustments |
|
|
|
|
Change in due from managers |
|
|
(31 |
) |
Change in other assets |
|
|
(17 |
) |
Change in other liabilities |
|
|
(9 |
) |
Cash
burn |
|
$ |
(399 |
) |
In a scenario in which hotel operational
performance remains at the average of second quarter 2020 levels,
the following presents the reconciliation of monthly cash used in
operating activities to cash burn (in millions):
|
|
Monthly average remainder of 2020 |
|
|
|
Low |
|
|
High |
|
GAAP net cash used in operating activities |
|
$ |
(76 |
) |
|
$ |
(73 |
) |
|
|
|
|
|
|
|
|
|
Capital expenditures |
|
|
(38 |
) |
|
|
(31 |
) |
Timing adjustments |
|
|
|
|
|
|
|
|
Changes in other assets/other liabilities |
|
|
4 |
|
|
|
4 |
|
Cash
burn |
|
$ |
(110 |
) |
|
$ |
(100 |
) |
A PDF accompanying this announcement is available
at: http://ml.globenewswire.com/Resource/Download/583af8ab-6e77-40a6-bb9e-e8e3a6a3963c
Host Hotels and Resorts (NYSE:HST)
Historical Stock Chart
From Apr 2024 to May 2024
Host Hotels and Resorts (NYSE:HST)
Historical Stock Chart
From May 2023 to May 2024