Ryman Hospitality Properties, Inc. (reit) · NYSE:RHP
Ryman Hospitality Properties, Inc. (reit) — Gaylord Entertainment — Investor Day (June 2003)
89 slides from Ryman Hospitality Properties, Inc. (reit)'s investor day presentation, Jun 11, 2003
Slide 1: Gaylord Entertainment 2003 Analyst Conference
Gaylord Entertainment 2003 Analyst Conference Gaylord Opryland Resort & Convention Center June 10-11, 2003 ^ Nashville, Tennessee defined by our differences
Slide 2: Privacy statement
Privacy statement The information contained in this slide presentation is summary information that is intended to be considered in the context of Gaylord Entertainment's SEC filings and other public announcements it makes, by press release or otherwise, from time to time. The Company undertakes no d
Slide 3: Agenda
Agenda Overview & strategy Colin Reed 45 minutes Gaylord Hotels Jay Sevigny 30 minutes Financial overview David Kloeppel 45 minutes Q&A
Slide 4: Overview & strategy
Colin Reed President & Chief Executive Officer Overview & strategy
Slide 5: Company transformation
GAYLORD ENTERTAINMENT™ Company transformation
Slide 6: Financial transformation
Financial transformation LTM 1Q03(1) LTM 1Q02(1) Revenues $420.0 $318.9 EBITDA (3) 65.7 31.8 % margin (3) 16% 10% Total debt $338.9 $398.6 Net debt (2) 275.1 368.6 Net debt / EBITDA 4.2x 11.6x (1) Last twelve months ended. (2) Defined as total debt less cash and equivalents of $63.8 million and $30.
Slide 7: Gaylord Hotels
GAYLORD HOTELS
Slide 8: Gaylord Hotels
Gaylord Hotels Gaylord Hotels is the only lodging brand focused solely on the large group meetings segment Market estimated to be $86 billion Our core customers are meeting planners who service large groups (200+ peak room nights) We provide custom-tailored solutions for our customers' unique needs
Slide 9: Gaylord Hotels - Defined by our Differences
Gaylord Hotels - Defined by our Differences 1st Qtr 3rd Qtr 4th Qtr 33.3 33.3 33.3 Superior Product Entertaining Environment Superior Service
Slide 10: Gaylord Hotels - superior product
Gaylord Hotels - superior product 1st Qtr 3rd Qtr 4th Qtr 33.3 33.3 33.3 Superior Product Entertaining Environment Superior Service Significant scale Highest ratio of meeting space per room among our competitors Can accommodate multiple large groups simultaneously All in one place Guest rooms, meeti
Slide 11: Gaylord Hotels - superior service
Gaylord Hotels - superior service 1st Qtr 3rd Qtr 4th Qtr 33.3 33.3 33.3 Superior Product Entertaining Environment Superior Service Services to assist meeting planner Single point of contact to plan event "Marketing toolkit" to attract attendees Convention services rep. to ensure smooth event execut
Slide 12: Gaylord Hotels - entertaining environment
Gaylord Hotels - entertaining environment 1st Qtr 3rd Qtr 4th Qtr 33.3 33.3 33.3 Superior Product Entertaining Environment Superior Service Unique entertainment options inside each property Expansive, theme-based atriums Award-winning restaurants; high-quality banquet food Nighttime entertainment, s
Slide 13: Gaylord Hotels - brand development
Gaylord Hotels - brand development Superior Product Superior Service Entertaining Environment Customers: Meeting Planners & Attendees Sustainable Advantage Brand Development Superior Knowledge & Relationships Customer behavior drives our brand development.
Slide 14: Superior knowledge
Superior knowledge Competitive intelligence helps build sustainable advantage 25 years of customer relationships and historical database of spending patterns Currently conducting extensive national research study Screening approximately 12,000 meeting planners Developing comprehensive, proprietary d
Slide 15: Gaylord Hotels - competition
Gaylord Hotels - competition Less than 100 hotels in the U.S. Generally >1,000 rooms Have adequate meeting space, or are connected to / within walking distance of a municipal convention center Variety of brands, but not a major focus for any single brand Marriott Hilton Hyatt Starwood Intercontinent
Slide 16: Competitive operating models
Competitive operating models Gaylord Hotels Municipal Convention Center / Host hotel Meeting space / room (< 200 sq. ft.) Adequacy of meeting space ? ? ^ Ease of planning ? ^ ? Ease of logistics ? ^ ^ Control of service environment ? ^ ? Yield driven by group business ? ? ^
Slide 17: How have we performed?
How have we performed? How have we performed?
Slide 18: The economic environment has been challenging
The economic environment has been challenging. Smith Travel Research Reflects quarter-over-quarter percentage change (i.e., 1Q01 compared to 1Q00).
Slide 19: Our RevPAR index has improved dramatically
Despite the environment, our RevPAR index has improved dramatically... Gaylord Hotels RevPAR Index Palms Nashville 1Q02 0.95 0.75 1Q03 1.14 0.95 75% 114% 95% 95%
Slide 20: Hospitality segment profitability
....as has our hospitality segment profitability. ($ millions)
Slide 21: Our 2002 bookings were quite strong
Our 2002 bookings were quite strong. (thousands) Room nights booked (1) 1999 2000 2001 2002 Nashville 710 480 475 675 Palms 200 580 250 275 Texas 40 110 -25 250 (1) For all future periods.
Slide 22: Rotation and retention trends
Our rotation and retention trends are reflecting our fundamental health. 2002 multi-property bookings as a percentage of total Star account bookings. Star accounts rebooking within 4 months of their stay. 1Q02 2Q02 3Q02 4Q02 East 0.295 0.308 0.366 0.586 2001 2002 East 0.095 0.198 Retention bookings
Slide 23: What is the next challenge?
What is the next challenge? What is the next challenge?
Slide 24: Expansion opportunities
Expansion opportunities Satisfaction = Loyalty = Rotation = Growth San Diego, CA Phoenix, AZ Dallas, TX Washington, D.C Orlando, FL Nashville, TN Top convention markets* Existing site Under construction ? ? ? ? ? ? ? ? ? ? ? Los Angeles, CA Las Vegas, NV ? San Francisco, CA Chicago, IL Atlanta, GA N
Slide 25: Gaylord Hotels summary
Gaylord Hotels summary Only brand focused solely on the meetings & convention segment Unique assets custom-tailored to meet customers unique needs Industry-leading customer service based on well-trained & incentivized workforce Superior customer knowledge to deliver continuous product & sales / mark
Slide 26: Grand Ole Opry
Slide 27: Grand Ole Opry
Grand Ole Opry An American icon with a 75+ year heritage as the cornerstone of country music Nationally and internationally renowned brand with extraordinary awareness and imagery 70 million "Country Lifestyle" consumers in the United States Opportunity to strategically position the brand and capita
Slide 28: Brand awareness
Brand awareness West 85% Midwest 89% South 83% Northeast 78% The Grand Ole Opry is among the most widely recognized "Country Lifestyle" brands in the United States.
Slide 29: Brand imagery
Brand imagery Consumers describe the Grand Ole Opry with overwhelmingly positive attributes. Base: Those who were at least somewhat familiar with the Grand Ole Opry; numbers reflect percentage of those who felt the attributes described the Opry "very well" or "well". Source: FutureBrand July, 2002 8
Slide 30: Brand development & extension
Brand development & extension Brand development & extension Distribution is the first step: Brand extension extension extension
Slide 31: Opry brand extension
The building blocks have been established through alliances with distribution partners We are currently developing and / or exploring additional products to capitalize on brand affinity and awareness Opry brand extension Cable Television Terrestrial Radio (FM) Terrestrial Radio (AM) Terrestrial Radi
Slide 32: Brand extension
Brand extension Base: Those who were at least somewhat familiar with the Grand Ole Opry Restaurants 37 42 51 64 0% 20% 40% 60% 80% 100% Recorded music Collectibles Clothing Source: FutureBrand July, 2002 Consumers show strong views toward extending the Grand Ole Opry brand.
Slide 33: Grand Ole Opry summary
Grand Ole Opry summary Extraordinary brand awareness from 75+ year heritage as cornerstone of country music Very positive brand imagery High consumer receptivity for brand extension Low-cost distribution channel for artists and record labels to reach millions of fans; will insulate and reinforce bra
Slide 34: Jay Sevigny
Jay Sevigny President, Gaylord Opryland Resort & Convention Center President, Gaylord Opryland Resort & Convention Center President, Gaylord Opryland Resort & Convention Center
Slide 35: Challenges in 2001
Challenges in 2001 Experiencing declines in Star accounts Advance reservations Occupancy Challenge of opening a new hotel in post-9/11 environment Declining employee satisfaction and customer satisfaction What did we do...
Slide 36: Our new vision
Our new vision STAR employees delivering flawless service to customers seeking meeting, conventions and leisure experiences
Slide 37: Superior service
Superior service Service begins with the right leadership Jay Sevigny, President, Gaylord Opryland Resort and Convention Center John Caparella, Senior Vice President, Gaylord Palms Resort & Convention Center John Imaizumi, Senior Vice President, Gaylord Opryland Texas Resort & Convention Center Func
Slide 38: Guest satisfaction
Guest satisfaction We measure customer satisfaction through an outside firm Our outstanding service experience rose across our network from 76% in 2001 to 88% in 2002 The number of guests who rated Gaylord an excellent price/value experience rose from 64% in 2001 to 76% in 2002 As a result, a guest
Slide 39: Superior product
Superior product Our properties logistically meet the needs of our target customers - meeting planners and convention attendees Generous meeting space per hotel room is a distinct competitive advantage over our competitors Product enhancements have been made to provide flawless service and to exceed
Slide 40: Awards & recognition - Gaylord Opryland
Awards & recognition -Gaylord Opryland Honored with the prestigious "Gold Key Elite" award by Meetings & Conventions magazine Old Hickory Steakhouse awarded the prestigious DiR^NA Award National media coverage: President George W. Bush was the keynote speaker at the NRB conference The Food Network f
Slide 41: Awards & recognition - Gaylord Palms
Awards & recognition - Gaylord Palms AAA Four Diamond Award 2003 Pinnacle Award 2003 Incentive magazine Platinum Partner award Digital City: Best Breakfast, Best Spa Society of American Travel Writers visit in Nov. 2003 2003 Larson Award National TV: Price is Right, Elimidate Elimidate Elimidate Eli
Slide 42: Financial discipline and results
Financial discipline and results Financial discipline and results Compared to prior year, 1Q showed marked improvement in Revenue and EBITDA 88% incremental flow through Favorable group business and responsible fiscal management led to: 11.5% point increase in EBITDA margin 3.0% point improvement in
Slide 43: Gaylord Opryland Nashville
Gaylord Opryland Nashville The crown jewel of the Gaylord Hotels family, this showcase resort lavishes guests with genuine Southern delights and hospitality Themed atriums include: Magnolia Garden Conservatory Cascades Delta Delta Delta Delta Delta Delta Delta Delta Delta Delta Delta Delta
Slide 44: Gaylord Palms
Gaylord Palms Just minutes from Disney World in Kissimmee-St. Cloud, this magical property invites guests on a spirited journey of the Sunshine State Themed atriums include: Key West Everglades St. Augustine
Slide 45: Compelling environments
Compelling environments Compelling environments Meeting and Convention Space Space Space Space Environment Entertainment Shopping Leisure Activities Activities Activities Activities Activities Fine Dining
Slide 46: Entertainment / thematic atmosphere
Entertainment / thematic atmosphere SS Gaylord - Gaylord Palms Resort & Convention Center
Slide 47: Client observations
Client observations Client observations Client observations "We got countless compliments on the location / amenities" - -National Association for Campus Activities February 24 - March 2, 2003
Slide 48: Client observations
Client observations Client observations Client observations "In years past the lines at the restaurants were a problem-this year there were no lines. Your can tell customer service is a focus of the hotels" - -Optical Image Technologies March 9-11, 2003
Slide 49: Client observations
Client observations "Out of Nowhere, 30 People set an entire room in 15 minutes. Great Job" - -Diabetic Shoes.com March 11-12, 2003
Slide 50: Square footage comparisons
Square footage comparisons Gaylord Hotels average 241 square feet of meeting, exhibition and pre- function space per guest room.
Slide 51: Room configuration options
Room configuration options Room configuration options Gaylord Opryland Resort & Convention Center
Slide 52: Room configuration options
Room configuration options Gaylord Palms Resort & Convention Center
Slide 53: Flexible meeting space
Flexible meeting space Delta Ballroom - Gaylord Opryland Resort & Convention Center
Slide 54: Flexible meeting space
Flexible meeting space Osceola Ballroom - Gaylord Palms Resort & Convention Center
Slide 55: Gaylord Opryland Texas
GAYLORD OPRYLAND TEXAS" RESORT & CONVENTION CENTER 59
Slide 56: Gaylord Opryland Texas - January 2002
Gaylord Opryland Texas - January 2002
Slide 57: Gaylord Opryland Texas - April 2003
Gaylord Opryland Texas - April 2003
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Slide 60: Gaylord Opryland Texas
Gaylord Opryland Texas
Slide 61: Gaylord Opryland Texas
Gaylord Opryland Texas
Slide 62: GAYLoD HoreLs
GAYLoD HoreLs fr _Resrauepar: "Wes" Leyton peo LAKE Hoge
Slide 63: A refined marketing message
A refined marketing message 2001 Advertising Current Advertising Current Advertising
Slide 64: Internet development
Internet development Launched re-designed Gaylord Hotels and Gaylord Opryland websites. Consistent brand look and feel across properties Meeting space guide 360-degree views
Slide 65: Gaylord brand image
Gaylord brand image In-Room Table Tent Advertisement Direct Mail Extended consistent brand look and feel across attractions and direct mail marketing.
Slide 66: Gaylord Hotels brand advertising
Gaylord Hotels brand advertising Gaylord Hotels brand advertising Gaylord Hotels brand advertising Gaylord Hotels brand advertising
Slide 67: David Kloeppel
David Kloeppel Executive Vice President & Chief Financial Officer
Slide 68: Large group focus
Large group focus Group Non-Group East 82 18 82% of our business comes from group business. 19% of groups generate 87% of group room nights. Note: Information based on 2002 occupancy. 82% Group 18% Non-Group Total Room Nights 1046 Star (600+) Target (201-599) Exec. Mtgs. (10-200) 121 129 1046 17% 70
Slide 69: Customer characteristics
Customer characteristics A large association segment contribution provides revenue visibility and stability. Average Booking Window 49% 11% 18% 22% Customer Segmentation Association Corporate Other Group Leisure 0 1 2 3 4 5 YEARS 4.2 2.5 2.1 Note: Information based on current bookings for all future
Slide 70: Life cycle of a booking
Life cycle of a booking Measuring the pipeline and its components provides indications for future occupancy. Turndown / Cancel Information Request Meet rate guidelines? Meeting space ratios? Availability? Yes Contract proposed? Prospect Yes Contract signed? Tentative Yes New Definite No No No 6-7 we
Slide 71: New prospects
New prospects The overall number of new prospects has increased over the past twelve months and is now back to September 2001 levels. Trailing 6-month average 800 700 650 600 550 500 450 400 750 New Prospects Roomnights (000)
Slide 72: Inventory of prospects
Inventory of prospects Inventory of prospects has been increasing over the last year. Prospect Inventory Roomnights
Slide 73: Conversion
Conversion Conversion ratios have improved over the past 18 months. Trailing 6-month average Trailing 6-month average Conversion Ratio of Prospects to Definites
Slide 74: Conversion
Conversion Small changes in conversion ratios produce meaningful increases in future revenue. New prospects / year (room nights) 7.2 million Conversion ratio change 1% Room nights 72,000 ADR $150.00 Food & beverage $150.00 Future revenue impact $21.6 million
Slide 75: New definites
New definites - - 20 40 60 80 100 120 140 160 180 Jan-01 Apr-01 Jul-01 Oct-01 Jan-02 Apr-02 Jul-02 Oct-02 Jan-03 Apr-03 Trailing 6-month average New Definites Roomnights (000)
Slide 76: Total RevPAR drives operating margins
Total RevPAR drives operating margins Note: Example case is for discussion purposes only. Assumes only Palms and Opryland Nashville rooms are in service. Business mix and operating margins are indicative of Gaylord Hotels business model but are not indications of historical or future operating perfo
Slide 77: EBITDA sensitivity
EBITDA sensitivity 10,000 room nights = $1.5 1 occupancy point = $2.3 $1 ADR = $1.1 1% increase in EBITDA margin = $3.6 Note: Assumes only Palms and Opryland Nashville in operation. $150 average ADR, $150 F&B and other revenue and 50% average margin. The following table highlights the impact to EBIT
Slide 78: Attractions - how we make money
Attractions - how we make money The Attractions segment is comprised of a number of businesses Grand Ole Opry Ryman Auditorium Springhouse Golf Club Having one-of-a-kind attractions create a "unique destination" that is appealing to meeting planners and distinguishes us from our competitors Provides
Slide 79: Attractions - how we make money (continued)
Attractions - how we make money (continued) Package room nights and attractions to stimulate transient and group leisure segments Generally correlated with the top-line growth of our Gaylord Opryland Nashville property Target segment EBITDA margin of mid-to-low teens Grand Ole Opry will drive segmen
Slide 80: Balance Sheet
GAYLORD Balance Sheet
Slide 81: Balance sheet
Balance sheet (1) Pro-forma for radio sale (anticipated to close in 3Q02) and closing of bank financing. (2) Defined as total debt less cash and equivalents of $63.8 million and $254.7 million, respectively, for 1Q03 and proforma. (3) Last twelve months ended EBITDA. Debt outstanding ($ millions) 1Q
Slide 82: Financing strategies for future development
Financing strategies for future development As the Gaylord Hotels brand continues to mature, we will evaluate ways to unlock capital from our real estate holdings to accelerate growth. Recycle capital invested in real estate Increase returns on invested capital Move to joint-venture / management fee
Slide 83: Non-core assets and ownership
Bass Pro Shops Nashville Predators Oklahoma Redhawks Various real estate Ownership 19.0% 128% 7678 GAYLORD 87
Slide 84: Bass Pro Shops profile
Bass Pro Shops profile Outdoor products category-killer 16 stores in 10 states; primarily in eastern United States Adding 5 new stores by year-end 2003 and at least 5 new stores by 2004 Ownership structure: GET 19.0% JW Childs 28.5% Johnny Morris and affiliates 52.5%
Slide 85: Guidance
Guidance We remain comfortable with our previously issued guidance Q2 2003 RevPAR = 7% - 9% growth revenue = $100 - $103 million EBITDA = $14 - $16 million CAPEX = $60 - $65 million 2003 RevPAR = 4% - 7% growth CAPEX = $230 - $235 million Future RevPAR based on current booking trends and assuming no
Slide 86: Vision for the future
Vision for the future AM, cable, satellite distribution complete FM distribution limited Limited product set 3 - 5 Years Tomorrow Today Non-Core 3 property platform Nascent brand Invested own capital to prove business model Significant real estate ownership Extensive customer relationships Non-Core
Slide 87: Investment considerations
Large market opportunity ($86 billion) Superior product offering Well-seasoned management team Strong revenue visibility / stability Significant growth opportunities Large market opportunity (70 million "Country Lifestyle" consumers) Leading industry brand Many unutilized assets Low capital-intensiv
Slide 88: EBITDA reconciliation to operating income
EBITDA reconciliation to operating income ($ millions) (1) EBITDA and EBITDA margin should not be considered as an alternative to any measure of performance as promulgated under accounting principles generally accepted in the United States (such as operating income, net income or cash from operation
Slide 89: Gaylord Hotels
a 2y GAYLORD HOTELS 93