Signs Of Improvement
Trio Of Large Brand Companies Reveal Net Income, RevPAR Growth In 3Q Reports
Several of the large brand companies reported both net income and RevPAR growth in their recently released third-quarter reports when compared to 2020 driven largely by leisure travel and incremental gains in group business.
Hilton, for the third quarter ended Sept. 30, reported net income of $240 million.
For the three and nine months ended Sept. 30, system-wide comparable RevPAR increased 98.7% and 47.6%, respectively, compared to the same periods in 2020, due to increases in both occupancy and ADR, and the three months ended Sept. 30 was down 18.8% compared to the three months ended Sept. 30, 2019. Fee revenues increased 93% and 49%, respectively, compared to the same periods in 2020.
For the three months ended Sept. 30, diluted EPS was $0.86 and diluted EPS, adjusted for special items, was $0.78. compared to -$0.29 and $0.06, respectively, for the three months ended Sept. 30, 2020. Net income and adjusted EBITDA were $240 million and $519 million, respectively, for the third quarter, compared to a loss of $81 million and a gain of $224 million, respectively, for the same period in 2020.
“We are pleased with our third-quarter results, which continue to reflect recovery from the adverse impact of the COVID-19 pandemic,” said Christopher J. Nassetta, president/CEO, Hilton. “Leisure travel remained strong and business travel continued to pick up during the quarter.
Meanwhile, Wyndham Hotels & Resorts reported net income of $103 million for the three months ended Sept. 30, with Q3 RevPAR for the U.S. surpassing 2019 levels. The company also updated its 2021 full-year outlook.
The company generated net income of $103 million, or $1.09 per diluted share, compared to net income of $27 million, or $0.29 per diluted share, in the third quarter of 2020. The increase of $76 million, or $0.80 per diluted share, reflects the increase in fee-related and other revenues and lower net interest expense, partially offset by higher volume-related expenses due to the ongoing recovery in travel demand.
“Our resilient select-service franchising business model continues to lead the industry’s recovery with RevPAR well in excess of 2019 levels,” said Geoffrey A. Ballotti, president/CEO. “These results have been fueled by the many investments we made over the last two years to capture an increasing share of both leisure and everyday business travel. Developer interest in our brands is strong. Our pipeline grew another 440 basis points and is now at pre-pandemic levels. At the same time, our teams opened over 50% more rooms than we opened last year, and more rooms than we opened in the third quarter of 2019.”
Paris-based Accor, for the third quarter ended Sept. 30, reported that RevPAR improved by 20 percentage points over last quarter thanks to strong performances in key regions for the company.
RevPAR improved by 20 percentage points vs. Q2 2021, reflecting a strong activity recovery seen over the summer. Over the quarter, the strong demand translated in higher prices than in Q3 2019 in most leisure geographies such as French and British provinces, the UAE and the U.S. with strong lifestyle hotels. September and October confirmed the return of business travelers and some MICE activity.
“This third quarter of 2021 saw a genuine pick-up in demand,” said Sébastien Bazin, chairman/CEO, Accor. “Our business was very strong this summer in Europe, the Middle East and the Americas, particularly for our leisure destinations. These trends are expected to persist out to the end of the year.”