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In preparation for HST's 2Q earnings release tonight, we’ve put together the recent pertinent forward looking company commentary.

1Q CONFERENCE CALL YOUTUBE (April 25)

  • "Our strong first quarter performance combined with the robust group booking paid for the remainder of the year gives us confidence to raise our full year guidance. We feel very good about the fundamentals of the business and our outlook for the remainder of the year."
  • "We believe this positive cycle will gain momentum through the remainder of this year and into 2013, an increase in demand combined with projected low supply growth in our markets of roughly 0.5% in 2013 and 2014, should support a solid and sustained recovery."
  • "Group bookings for the remainder of the year surge by more than 13% compared to the prior year and are now approximately 7.5% ahead of last year's pace for the remaining three quarters and meaningfully positive in every quarter. The average rate for these bookings is up approximately 2% and our recent bookings have exceeded last year's rates by more than 8%. Both trends bode well for the future."
  • "Our transient bookings also continue to run well ahead of last year's levels and suggest strong rate growth. The combination of these trends suggests that we should continue to see improvements in occupancy in 2012, which will ultimately drive higher rates and additional mix shift. We are also seeing positive group booking activity extend into 2013, indicating that our group hotels, which lag during the early stages of this recovery, are now benefiting from increased business spending."
  • "We would expect to be a net buyer this year, but we intend to remain disciplined. If pricing levels move too high, we will look to take advantage by accelerating our sale activities. Given the unpredictability of the timing of these transactions, our guidance does not assume any additional acquisitions or dispositions this year beyond what we have already announced."
  • "We continue to find construction pricing attractive and expect these investments will yield returns substantially in excess of our cost of capital. Through the full year, we expect to spend approximately $150 million to $170 million."
  • "In terms of maintenance capital expenditures, we … expect to spend $300 million to $330 million for the full year."
  • 2012 guidance: 
    • Comparable hotel RevPAR guidance to 5% to 7%
    • On the margin side, even given that occupancy growth is still making a meaningful contribution to RevPAR growth, we believe we can drive incremental profitability and strong flow through. We expect to increase margins 50 to 100 basis points
    • Adjusted EBITDA in the range of $1.120 billion to a $1.165 billion
    • Adjusted FFO per share of $1.01 to $1.08
    • Dividends for the remainder of the year will depend on both operating results and gains on asset sales.
  • US market outlook:
    • "We expect Philadelphia to be a top-performing market in the second quarter due to strong group demand, which should allow us to drive pricing."
    • "We expect our Chicago hotels to continue to perform very well in the second quarter due to strong group and transient demand."
    • "We expect our Hawaiian properties to underperform our portfolio in the second quarter, but having good second half of the year."
    • "We expect our Houston hotels to underperform our portfolio in the second quarter, due to an unfavorable comparison to the first quarter of 2011 when the City of Houston hosted the NCAA Men's Final Four."
    • "We expect our Miami and Fort Lauderdale hotels to continue to perform well in the second quarter."
    • "We expect our Los Angeles hotels to continue to perform well in the second quarter due to strength in both group and transient demand."
    • In 1Q, "Our New York hotels... were negatively impacted by the second and final stage of the rooms renovations at the New York Marriott Marquis and the Sheraton New York Hotel & Towers, meeting space renovations at the W New York and a rooms renovation at the W Union Square. We expect our New York hotels to have a good second quarter."
    • "2012 will be a challenge in D.C. due to a weaker city-wide calendar, government travel cutbacks and a lack of legislative activity, which reduces demand. We expect the second quarter will be better, but still underperform our portfolio."
    • "We do expect our San Antonio hotels to perform better in the second quarter but to continue to underperform our portfolio."
    • "Atlanta was actually up 4.9%. Very good group, city-wide demand. We actually expect an even better second quarter. We've got really good group and transient pace on the books. And then for the rest of the year it will basically end up about where it was in the first quarter."
    • "Inbound travel to the euro zone from the U.S., U.K., Asia and the Middle East continues to be strong and is a major source of euro lodging demand. The Westin Europa & Regina in Venice, the Sheraton Warsaw, the Sheraton Skyline in London and the Paris Versailles, all had double digit RevPAR increases for the quarter."  
  • "Looking to the rest of 2012, we expect that RevPAR will be driven by both occupancy and rate growth but rate growth will be increasingly more important throughout the year. The additional rate growth should lead to solid room flow through even with growth in wage and benefit cost. We expect the positive trends in group demand to continue particularly in the second and fourth quarters which will help drive growth in banquet and audio-visual revenues and good F&B flow through. We expect unallocated cost to increase more than inflation particularly for rewards in sales and marketing where higher revenues will increase cost. We also expect property taxes to increase roughly 8%, the utilities to increase between 1% and 2% for the year."
  • "As we look overall for the full year what we're seeing at this point now is that our overall booking pace for the full year is up actually about 8.5% on a revenue basis for the full year. But that is much stronger for the last three quarters of the year than it was for the first part. So actually if you look at the last three quarters of the year, we are running – on the revenue basis, we're running in the 9.5% to 10% area. That gets comprised of a high 7% increase in room nights combined with a couple of percent in rate. "
  • "Overall, the larger hotels are probably seeing a little bit less of their business coming from group right now than they have in the past. I think they're getting the rate because they are well located in markets that are recovering quickly, which in part accounts for the differential in rate. But, we've not recovered close yet to our prior levels of group activity, you haven't quite seen the same level of group business at those larger hotels.
  • "We're seeing some… bigger increases in the smaller hotels than we are seeing in the larger hotels. We're seeing significantly good, strong increases in both. But, I think part of that comparison, you need to understand that the smaller hotels tend to book a lot of their business fairly short term.  Part of what we're encouraged by when we look at the larger hotels is the fact the association business is better, corporate group is better. We're hearing signs from our operators that the associations are thinking in terms of bigger events, both in days and attendance, as they look out into 2013 and 2014 and beyond. So, I think there's a confidence in the larger groups that they're going to hold bigger events as opposed to smaller events looking outward. That will clearly benefit the larger hotels."