Pebblebrook Hotel Trust (NYSE:PEB) Q2 2023 Earnings Conference Call July 28, 2023 9:00 AM ET

Company Participants

Raymond Martz - CFO

Jon Bortz - Chairman and CEO

Conference Call Participants

Dori Kesten - Wells Fargo

Smedes Rose - Citi

Bill Crow - Raymond James

Duane Pfennigwerth - Evercore ISI

Floris van Dijkum - Compass Point

Ari Klein - BMO Capital Markets

Michael Bellisario - Baird

Gregory Miller - Truist Securities

Anthony Powell - Barclays

Operator

Greetings and welcome to the Pebblebrook Hotel Trust Second Quarter Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded.

It is now my pleasure to introduce your host, Raymond Martz, Co-President and Chief Financial Officer. Thank you. You may begin.

Raymond Martz

Thanks Donna, and good morning everyone. Welcome to our second quarter 2023 earnings call and webcast. Joining me today is Jon Bortz, our Chairman and Chief Executive Officer; and Tom Fisher, our Co-President and Chief Investment Officer. And for those of you who track these sorts of things, this is Jon's 100th earnings call, so congrats, Jon.

To start, a reminder that comments today are effective for only today, July 28th, 2023. Our comments may include forward-looking statements under federal securities laws. Actual results could differ materially from our comments. Please refer to our latest SEC filings for a detailed discussion of potential risk factors and our website for reconciliations of the non-GAAP financial measures referred to during our call.

We are pleased to report that our adjusted EBITDA and adjusted FFO both exceeded the top end of our outlook. Operating expense reductions helped to offset lower-than-expected RevPAR growth, while greater-than-expected business interruption proceeds and interest and tax savings provided a further boost to our bottom-line financial results.

We continue to see a gradual recovery in business travel as both improving group and transient demand benefited our urban properties. The recovery in San Francisco led the way, with occupancy climbing by over 13 points followed by Washington, D.C. up 11 points, Los Angeles increasing over nine points, Chicago up six points, and Portland increasing almost three points.

Our urban properties also benefited from recovering leisure travel to the cities with concerts, sporting events, and festivals, generating demand loss during the pandemic. A big thank you to Taylor Swift, and we love her, Dead & Company, and Morgan Wallen. And please keep scheduling those big contracts.