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In an effort to evaluate performance and as a follow up to our YouTube, we compare how the quarter measured up to previous management commentary and guidance


  • Even after adjusting for a lower tax rate and d&a, Q2 was very strong for Hyatt.  Adjusted EBITDA exceeded our estimate handily driven mainly by fees.  We were encouraged by the significant amount of stock repurchased during the quarter as the balance sheet remains underleveraged.   


  • BETTER:  Hyatt repurchased nearly $200 million of stock in the quarter (Hyatt had announced an additional $200MM increase in repurchase authorization in Q1).  Hyatt will continue to evaluate their capital allocation options.
  • PREVIOUSLY:  “So one think I would, just to note is that, our primary application of our capital base on our balance sheet is to support our growth, that's our number one priority. We have been, more formally over the last year, been in the market and repurchasing shares."


  • WORSE:  2014 bookings are trending near flat, lower than previous guidance.  Hyatt remains optimistic about 2015-2016 growth.
    • “Bookings for 2014 have increased by 10%. So the short-term booking trend is still very volatile. It's still very sensitive on a month-to-month basis and we continue to see that long-term bookings 2014, 2015 and even into 2016 look very healthy, look very promising. We don't see any issues there yet. Although, when you go back to last year August, September, October and you looked at 2013 and the booking trends were and compare it to where we are now with 2013, there has been quite of a wash, cancellation and push out into future years, and we continue to see that trend.”
    • “Overall, we see our booking experience as an indication that the booking window is lengthening.”


  • SAME:  2Q in the quarter for the quarter growth was 1%.  In the quarter for the year, bookings increased 6.5%.
  • PREVIOUSLY:  “As we look to the future, we're encouraged by several data points. First, group pace. Even though realized revenue for group business was down in the first quarter, overall group revenue production was up over 3% in the quarter.”


  • BETTER:  Strong transient demand was ahead of expectations.  Manufacturing, business serving the housing industry and technology segments continue to lead.
  • PREVIOUSLY:  “Second, transient demand, the overall business climate in the U.S. was strength in manufacturing, technology, housing and other sectors, is supporting robust transient demand levels. Therefore, while we expect group demand to improve relative to what we saw in the first quarter, we still expect transient business to be a stronger driver of improved results this year.”


  • WORSE:  Continues to be a challenging market, impacted by austerity measures, renovations and increased supply.  The outlook remains weak for 2013.
  • PREVIOUSLY:  In China, the focus by the new leadership on austerity has and will continue to hurt F&B revenue, in particular in the short-term.”


  • SAME:  REVPAR was stable in 2Q
  • PREVIOUSLY:  “In India, the economy is starting to stabilize, while the country enters a national political process leading up to general elections in 2014. Nonetheless, the positioning of our existing portfolio as well as the hotels expected to join our portfolio over the coming year in each of China and India is very encouraging.”


  • BETTER:  Impact from renovation of managed properties in 2Q was only $1MM
    • "We expect the impact to be towards the lower end of the previously mentioned $3 million to $6 million range per quarter for the next quarter or two. The impact is expected to decline as renovations of managed hotels are completed and year-over-year comparison issues recede.”
    • “I think the modeling disruption beyond the end of this year, we know now and we mentioned that the renovations in the key markets in Asia would continue into next year.”


  • SAME: Continues to be active.  They have four assets that are generating much interest in the transaction market.
  • PREVIOUSLY:  “Our intention is to continue to be active through the cycle on both the buy-side and the sell-side.”