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Increased Bookings Not Enough To Help Lift 1Q Results For Brands

By Dennis Nessler | May 6, 2021

While a marked increase in bookings in March and April helped lift earnings for several major brand companies, it wasn’t enough to avoid substantial first quarter losses compared to results from the same period in 2020.

Nevertheless, company leaders pointed to the rollout of vaccines and easing travel restrictions as key catalysts to what they expect will be improved results going forward.

Hilton has reported a net loss of $109 million for the first quarter ended March 31. System-wide RevPAR was $46.23, a decrease of 38.4% from the same period last year. Occupancy came in at 43.9%, an 11% drop from Q1 2020, and ADR was $105.38, a decline of 23% from the same quarter last year.

In addition, system-wide comparable RevPAR decreased 38.4% compared to Q1 in 2020 due to both occupancy and ADR decreases. Additionally, as a result of the pandemic, fee revenues decreased 34% during Q1 compared to the same period in 2020.

For the first quarter, diluted EPS was -$0.39 and diluted EPS, adjusted for special items, was $0.02 compared to $0.06 and $0.74, respectively, for the same period last year. Net income and Adjusted EBITDA were -$109 million and $198 million, respectively, for the first quarter, compared to $18 million and $363 million, respectively, for the first quarter of 2020.

Meanwhile, Hyatt Hotels Corporation, for the first quarter ended March 31, reported a net loss of $304 million, or $2.99 per diluted share, compared to a net loss of $103 million, or $1.02 per diluted share, in the first quarter of 2020. Adjusted net loss was $363 million, or $3.57 per diluted share, in the first quarter of 2021, compared to adjusted net loss of $35 million, or $0.35 per diluted share, in the first quarter of 2020.

However, on a positive note comparable system-wide RevPAR and comparable owned and leased hotel RevPAR improved in the first quarter of 2021 compared to the fourth quarter of 2020. The pace of recovery varied by region and was favorably impacted by the easing of travel restrictions in certain markets and strengthening demand for leisure-oriented destinations, according to the company. Consistent with trends in each of the last two quarters, the recovery was led by relative strength in Greater China and U.S. select-service hotels.

Comparable system-wide RevPAR strengthened through the first quarter, increasing more than 50% from January to March, and reaching the highest level since the onset of the COVID-19 pandemic. As of March 31, 96% of total system-wide hotels (94% of rooms) were open.

Wyndham Hotels & Resorts, meanwhile, benefitted from some cost cutting measures. For the three months ended March 31, reported net income for Wyndham was $24 million, an increase of $2 million when compared to Q1 2020’s figure of $22 million. Revenues declined from $410 million in the first quarter of 2020 to $303 million in the first quarter of 2021.

The revenue decline of $107 million from Q1 2020 to 2021 includes lower pass-through cost-reimbursement revenues of $55 million in the company’s hotel management business, which have no impact on adjusted EBITDA. Excluding cost-reimbursement revenues, revenues declined $52 million primarily reflecting an 11% decline in constant-currency global RevPAR.

The increase of $2 million, or $0.03 per diluted share, in net income was a result of the company’s COVID-19 cost mitigation plan implemented in April 2020, lower volume-related expenses and the absence of restructuring and transaction-related expenses, which were partially offset by the global RevPAR decline, according to the company.

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Dennis Nessler
Editor-in-Chief

Dennis Nessler is Editor-in-Chief of Hotel Interactive, parent company of Hotel Community Forum. Nessler brings more than 28 years of editorial experience to his position, including some 17 years in the hospitality industry. As part of his duties, Nessler not only covers the industry editorially but moderates various high-level panel sessions at hospitality events and frequently conducts one-on-one interviews with C-level executives.


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