Host Hotels & Resorts, Inc. (HST) Q2 2023 Earnings Call Transcript

For the period ending June 30, 2023

August 3, 2023 1:00 p.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good afternoon, and welcome to the Host Hotels & Resorts Second Quarter 2023 Earnings Conference Call. Today's conference is being recorded. And at this time, I would like to turn the call over to Jaime Marcus, Senior Vice President of Investor Relations. You may go ahead.

Jaime Marcus

Thank you, and good afternoon, everyone. Before we begin, please note that many of the comments made today are considered to be forward-looking statements under federal securities laws. As described in our filings with the SEC, these statements are subject to numerous risks and uncertainties that could cause future results to differ from those expressed, and we are not obligated to publicly update or revise these forward-looking statements.

In addition, on today's call, we will discuss certain non-GAAP financial information, such as FFO, adjusted EBITDAre and comparable hotel level results. You can find this information, together with reconciliations to the most directly comparable GAAP information, in yesterday's earnings press release and our 8-K filed with the SEC and in the supplemental financial information on our website at hosthotels.com.

With me on today's call are Jim Risoleo, President and Chief Executive Officer; and Sourav Ghosh, Executive Vice President and Chief Financial Officer.

With that, I would like to turn the call over to Jim.

Jim Risoleo

Thank you, Jamie, and thanks to everyone for joining us this afternoon. During the second quarter, we delivered a comparable hotel RevPAR improvement of 2.7% compared to the second quarter of 2022. Our RevPAR performance for the quarter came in below our quarterly guidance primarily as a result of moderating transient demand in San Francisco and Seattle and at our resorts to a lesser extent.

Comparable hotel RevPAR growth was 3.8% during the quarter, underscoring the continued strength of out-of-room spend. During the quarter, we delivered adjusted EBITDAre of $446 million and adjusted FFO per share of $0.53. For our second quarter comparable hotel EBITDA of $449 million was 9% below 2022, it was 9% above 2019.

Second quarter comparable hotel EBITDA margin of 32.7% exceeded 2019. This marks the fifth consecutive quarter since the onset of the pandemic that we have achieved RevPAR, RevPAR and comparable hotel EBITDA and margins ahead of 2019 levels.

Comparable hotel RevPAR for July is expected to be approximately $209, which is 2.5% above July of 2022. Our performance in the first half of the year, coupled with the macroeconomic backdrop in the second half, led us to tighten our full year RevPAR growth guidance range to 7% to 9%. Bringing the midpoint of our full year expected RevPAR growth to 8%.