Park Hotels & Resorts Inc. · NYSE:PK
Park Hotels & Resorts — Q3 2024 Earnings Presentation
32 slides from Park Hotels & Resorts's earnings presentation, Oct 30, 2024
Slide 1: Investor Presentation
Investor Presentation November 2024
Slide 2: Park Hotels & Resorts: Mission, Investment Strategy, Guiding Principles
Park Hotels & Resorts Mission Investment Strategy Guiding Principles To be the preeminent lodging Upper-Upscale & Luxury Aggressive REIT, focused on consistently Full-Service Asset Management delivering superior, risk- adjusted returns for Premier Urban and Resort Prudent stockholders through active
Slide 3: Park at a Glance
Park at a Glance 41 Hotels 25K $6.6B Rooms Enterprise Value (1) 9.9x EBITDA Multiple (2) Waldorf Astoria Orlando Hilton Waikoloa Village Top 10 Markets TTM 3Q24(3) 1) Hawaii 32% Signia Hilton Bonnet Creek 2) Orlando 14% Hilton Denver City Center 3) New Orleans 7% 4) Southern CA 7% 5) Boston 7% 6) Ne
Slide 4: Park: A Compelling Investment Story
Park: A Compelling Investment Story Undervalued Internal Growth ROI Pipeline Financial Flexibility Iconic portfolio at Improving demand ROI pipeline to drive Ample liquidity to wide discount(1) 2024 Comparable RevPAR growth value creation execute strategy guidance of 1.5% to 2.5% vs 2023 36% discoun
Slide 5: Experienced Management Team with Track Record of Success
Experienced Management Team with Track Record of Success President, Chairman & CEO Thomas J. Baltimore, Jr. Executive Management EVP, CFO & EVP, Design & EVP, Asset EVP & EVP & CIO EVP, HR General Counsel Treasurer Construction Management Tom Morey Jill Olander Joe Piantedosi Nancy Vu Sean M. Dell’O
Slide 6: Iconic Portfolio: Urban and Resort Destinations
Iconic Portfolio: Urban and Resort Destinations Hilton Hawaiian Village Waikiki Beach Resort Hyatt Regency Boston Royal Palm South Beach Miami Hilton Denver City Center Hilton Waikoloa Village Waldorf Astoria Orlando Signia Orlando Bonnet Creek Hilton New Orleans Riverside Hilton Santa Barbara Beach
Slide 7: Building Blocks for Growth
Building Blocks for Growth Hilton Waikoloa Village 7|
Slide 8: 2024 Outlook
2024 Outlook FY 2024 Outlook Excluding Impact of Hurricanes and Strike Activity as of November 11, 2024 Metrics Comparable RevPAR Low $183 High $185 +200 bps Y/Y Growth 1.5% 2.5% FY 2024 Comparable RevPAR Growth Adjusted EBITDA $635 $655 (at Midpoint) Y/Y Change (3.6%) (0.5)% $675M Comparable Hotel
Slide 9: Park Portfolio: Well-Insulated from Supply
Park Portfolio: Well-Insulated from Supply (1) Favorable supply picture for Park through 2025 National Supply Growth Average: 0.8% 30.0% 20.0% 10.0% 2.9% 2.7% 2.2% 2.1% 1.3% 1.2% 1.2% 1.2% 1.1% 0.9% 0.9% 0.8% 0.8% 0.8% 0.7% 0.5% 0.1% 0.1% —% 0.0% Ne Na Ph Da Se Or Ha At Ho Sa Ne W Lo Ch De M Bo Ph S
Slide 10: Improving Group to Drive Performance in 2024
Improving Group to Drive Performance in 2024 Group Demand Continues to Recover at a Strong Pace Group trends expected (1) to accelerate well into 2024 2024 Comparable Group Revenue Pace Market Highlights 21.0% 17.8% 13.3% 13.4% Chicago: Group Revenue Pace ahead of 2023 by 12%; citywide 10.5% 11.0% 1
Slide 11: Why Hawaii: Among Top Resort Markets in US with Bright Future
Why Hawaii: Among Top Resort Markets in US with Bright Future Key Drivers of Hawaii’s Success By the Numbers: PK’s Hawaii Hotels • Consistently Ranked Among Top Resort Markets in US: Over the last 20 years, Oahu’s RevPAR growth has outpaced the US by 120 bps $230M • Increased Domestic Airlift: US Ai
Slide 12: ROI Case Study: Signia + Waldorf Bonnet Creek
ROI Case Study: Signia + Waldorf Bonnet Creek $220M meeting space expansion and comprehensive renovation elevates group profile of iconic complex Resort Complex Profile • 1,511 guestrooms • 296,000 SF meeting and event space • 11 dining options • 2 pools and 1 lazy river • 18-hole golf course • 1 sp
Slide 13: ROI Case Study: Casa Marina, Curio Collection
ROI Case Study: Casa Marina, Curio Collection $80M investment in transformative rebranding, renovation and resiliency upgrade of iconic Key West resort Financial Highlights Scope • $414 YTD RevPAR as of 3Q24, up 125% to last year; lapped Interior renovation disruption in 2023 • Complete renovation •
Slide 14: Value Enhancing ROIs: Track Record of Success
Value Enhancing ROIs: Track Record of Success Other Recent Value Enhancing ROI Projects Hilton Santa Barbara Beachfront The Reach Key West, Curio Casa Marina Key West, Curio Resort Collection by Hilton Collection by Hilton Re-branded from DoubleTree by Hilton Re-branded from Waldorf Astoria Re-brand
Slide 15: Major Capex Projects Underway
Major Capex Projects Underway Park’s investment in value-enhancing capex projects is expected to deliver strong growth Estimated Project Budget Scope Completion Full renovation of 392 guestrooms and the addition of 12 Hilton Hawaiian Village Waikiki guestrooms through the conversion of suites, incre
Slide 16: Robust ROI Pipeline: Significant Embedded Value
Robust ROI Pipeline: Significant Embedded Value Value Creation Key Developments (completed): $327M • Bonnet Creek Orlando ($220M) $1B • Casa Marina and The Reach Key West Resorts ($93M) Potential ROI Pipeline • Hilton Santa Barbara ($14M) In Planning Projects : ~$1B $320M+ • Hilton Hawaiian Village
Slide 17: Hilton Hawaiian Village Ala Moana Tower Development
Hilton Hawaiian Village Ala Moana Tower Development Project Summary • Develop a ~400K SF, 515-key high-rise tower adjacent to HHV – Park’s most iconic asset and largest EBITDA producer • Amenities expected to include arrivals/departures lounge, 8th floor outdoor pool and bar, 1st floor retail (flags
Slide 18: Hilton Waikoloa Village Development
Hilton Waikoloa Village Development Project Summary • Utilize existing density to develop up to 213 additional keys (timeshare or hotel) on existing parking and tennis court area • Park could develop additional hotel keys or pursue alternative use or monetization strategy for excess land (e.g., time
Slide 19: Casa Marina Outparcel Development
Casa Marina Outparcel Development Project Summary • Develop two land parcels adjacent to Casa Marina that are Casa Marina The Reach currently occupied by admin offices and vacant structures Potential • Requires zoning change and legislative measures to Development Site permit commercial transient re
Slide 20: Royal Palm South Beach Repositioning
Royal Palm South Beach Repositioning Project Summary • Comprehensive renovation of 404 rooms at the oceanfront hotel and repositioning to higher quality, upper upscale product offering • Scope will address all areas of hotel and incorporate amenities that are commensurate with other lifestyle hotels
Slide 21: Hilton Santa Barbara Development
Hilton Santa Barbara Development Project Summary • Create 77 net new keys through redevelopment of existing tennis courts and portion of parking lot • Development plan requires transfer of development rights from adjacent parcel that is owned by JV partner Rationale & ROI Drivers • Add keys to premi
Slide 22: Appendix
Appendix Hilton Hawaiian Village Waikiki Beach Resort 22 |
Slide 23: Strong Balance Sheet with Ample Liquidity
Strong Balance Sheet with Ample Liquidity Park's balance sheet remains strong with ample liquidity and improved financial flexibility for growth while providing protection during economic uncertainty Debt Metrics Over Time Commentary Actual Actual • Well-laddered and improved debt maturity schedule
Slide 24: Dedicated Corporate Responsibility Framework
Dedicated Corporate Responsibility Framework 6 Hotels Earned EPA’s ENERGY STAR Certification YTD 2024 GRESB Real Estate 3 Dedicated Assessment Subcommittees under formal Corporate Responsibility Committee: Ø Green Park Committee Founding donor of Nareit’s Dividends Through Diversity, Alignment with
Slide 25: Definitions
Definitions Comparable The Company presents certain data for its consolidated hotels on a Comparable basis as supplemental information for investors: Comparable Hotel Revenues, Comparable RevPAR, Comparable Occupancy, Comparable ADR, Comparable Hotel Adjusted EBITDA and Comparable Hotel Adjusted EBI
Slide 26: Definitions (Continued)
Definitions (Continued) Nareit FFO attributable to stockholders, Adjusted FFO attributable to stockholders, Nareit FFO per share – diluted and Adjusted FFO per share – diluted Nareit FFO attributable to stockholders and Nareit FFO per diluted share (defined as set forth below) are presented herein a
Slide 27: Definitions (Continued)
Definitions (Continued) Occupancy Occupancy represents the total number of room nights sold divided by the total number of room nights available at a hotel or group of hotels. Occupancy measures the utilization of the Company’s hotels’ available capacity. Management uses Occupancy to gauge demand at
Slide 28: Non-GAAP Financial Measures
Non-GAAP Financial Measures Comparable Adjusted EBITDA and Hotel Adjusted EBITDA TTM Nine Months Ended Year Ended (unaudited, in millions) September 30, September 30, September 30, December 31, 2024 2024 2023 2023 Net income (loss) $ 341 $ 153 $ (82) $ 106 Depreciation and amortization expense 286 1
Slide 29: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) Net Debt to Comparable Adjusted EBITDA (unaudited, in millions) September 30, 2024 September 30, 2023 Debt $ 3,855 $ 4,490 Add: unamortized deferred financing costs and discount 25 23 Less: unamortized premium — (1) Debt, excluding unamortized deferred financi
Slide 30: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) Guidance - Comparable Hotel Adjusted EBITDA, Comparable Hotel Revenues and Comparable Hotel Adjusted EBITDA Margin unaudited, in millions Year Ending December 31, 2024 Low Case High Case Net income 152 172 Depreciation and amortization expense 257 257 Interest
Slide 31: Non-GAAP Financial Measures (continued)
Non-GAAP Financial Measures (continued) Guidance - Nareit FFO Attributable to Stockholders and Adjusted FFO Attributable to Stockholders unaudited, in millions except per share data Year Ending December 31, 2024 Low Case High Case Net income attributable to stockholders $ 141 $ 161 Depreciation and
Slide 32: About Park and Safe Harbor Disclosure
About Park and Safe Harbor Disclosure About Park Hotels & Resorts Inc. Park (NYSE: PK) is one of the largest publicly-traded lodging real estate investment trusts ("REIT") with a diverse portfolio of iconic and market-leading hotels and resorts with significant underlying real estate value. Park's p
Park Hotels & Resorts — Q3 2024 Earnings Presentation on 6ix