NYSE$PK

Park Hotels & Resorts Inc · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

Park Hotels' Q2 2023 results were reported, demonstrating improvements across the portfolio driven by key urban and resort markets and group business acceleration.

Park Hotels & Resorts reported a Comparable RevPAR increase of 5% compared to Q2 2022, driven by a 330 basis point increase in Comparable Occupancy and a nearly 1% increase in Comparable ADR. The company ceased payments on the $725 million non-recourse CMBS loan secured by the Hilton San Francisco Hotels and repaid the $75 million W Chicago – City Center mortgage loan. They have over $1.7 billion in liquidity.

  • Comparable RevPAR increased by 5% compared to the second quarter of 2022.
  • Comparable group revenues returned to 92% of 2019 levels, with forward bookings continuing to increase.
  • Strategic capital allocation initiatives included the commencement of a comprehensive renovation of the Casa Marina Key West and the repayment of the $75 million W Chicago – City Center mortgage loan.
  • The company ceased making payments toward the $725 million non-recourse CMBS loan secured by the two Hilton San Francisco Hotels.

Headline financials

Total Revenue

$714M

Previous: $695M+2.7%
EPS (adj)

$0.60

Previous: $0.61-1.6%
Comparable RevPAR

$191.03

Previous: $173.03+10.4%
Comparable ADR

$248.33

No prior period
Comparable Occupancy

76.9%

Previous: 71.0%+8.3%
Comparable Total RevPAR

$301.74

No prior period
Capital Expenditures

-$124M

Previous: -$52M-138.5%
Free Cash Flow

-$274M

Previous: $98M-379.6%
Net Income

-$150M

Previous: $150M-200.0%
Operating Income

-$98M

Previous: $119M-182.4%
Gross Profit

-$63M

Previous: -$65M+3.1%
Cash & Equivalents

$797M

Previous: $758M+5.1%
Total Assets

$9.34B

Previous: $9.7B-3.7%
Stock-Based Comp

$5M

Previous: $5M+0.0%

Revenue & EPS history

Park Hotels · Revenue · Quarterly

$714M

Q2 2023+2.7%vs Q2 2022
Beat estimate in 9 of 15 quarters(60%)
ActualEstimate

Revenue by segment

Park Hotels · $692M total across 3 segments · Q2 2023

  • Rooms
    $442M+2.1%
  • Food & Beverage
    $178M+2.9%
  • Ancillary Hotel
    $72M+2.9%

Forward guidance

Park Hotels is revising its full-year outlook due to the continued underperformance of the two Hilton San Francisco Hotels.

Tailwinds

  • Ongoing strength in Park's Hawaii market
  • Acceleration of group business
  • Adjusted FFO excludes an incremental $15 million of default interest and late payment administrative fees associated with default of the SF Mortgage Loan, which is required to be recognized in interest expense
  • Fully diluted weighted average shares are expected to be 217 million
  • Includes $14 million of Hotel Adjusted EBITDA disruption from a full-scale renovation at the Casa Marina Key West, Curio Collection, which is expected to be completed in the fourth quarter of 2023.

Headwinds

  • Uncertainty surrounding macro-economic factors, such as inflation and increases in interest rates
  • Supply chain disruptions
  • Possibility of an economic recession or slowdown
  • The two Hilton San Francisco Hotels will remain in Park's portfolio for the remainder of 2023
  • Full-year 2023 outlook as of May 1, 2023 included the Embassy Suites Phoenix Airport hotel, which was subsequently removed from Park's portfolio in June 2023 upon the termination of its ground lease by the lessor

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

-1.5%

Avg return

Earnings day

+0.1%

Avg return

5 days after

+1.8%

Avg return

30 days after

37%

15 / 41 earnings

Positive

+11.8%

Q3 2023

Best reaction

-16.4%

Q1 2020

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-2.6%+0.3%+7.1%
Q4 2025-1.3%-1.4%-10.1%
Q3 2025-4.8%-6.0%+0.8%
Q1 2025-1.2%+1.2%-1.9%
Q4 2024-0.5%-5.7%-14.7%
Q3 2024+0.7%-0.9%+11.5%
Q2 2024-2.5%-9.8%+1.0%
Q1 2024-4.2%-3.5%-6.7%
Q4 2023+6.0%+9.4%+9.8%
Q3 2023+11.8%+16.7%+29.6%
Q2 2023-5.3%-1.8%-5.2%
Q1 2023+1.9%+7.4%+7.4%
Q4 2022+3.3%+3.9%-16.6%
Q3 2022-9.0%-9.4%-4.1%
Q2 2022-1.0%-0.5%-8.3%
Q1 2022-1.1%-2.1%-5.6%
Q4 2021-4.1%-7.2%-5.8%
Q3 2021+0.7%+6.7%-14.2%
Q2 2021+7.7%+6.9%+7.2%
Q1 2021+1.2%-1.5%-7.1%
Q4 2020-3.1%-7.1%-2.6%
Q3 2020-1.7%+37.2%+73.1%
Q2 2020-3.7%+13.6%+22.1%
Q1 2020-16.4%-16.2%+46.8%
Q4 2019-9.0%-9.3%-57.7%
Q3 2019-3.5%-6.5%+0.9%
Q2 2019-5.0%-9.5%-12.3%
Q1 2019-5.4%-6.8%-16.8%
Q4 2018-0.4%+1.3%-0.9%
Q3 2018+1.2%+2.0%+6.0%
Q2 2018+4.2%+3.7%+6.9%
Q1 2018+2.6%+4.3%+13.5%
Q4 2017-6.0%+0.6%+4.0%
Q4 2015-6.0%+0.6%+4.0%
Q3 2016+0.7%+0.8%-0.8%
Q3 2017+0.5%+1.1%-0.4%
Q2 2016-0.7%-1.4%+1.0%
Q2 2017-3.9%-1.5%-0.7%
Q4 2016+0.2%-1.8%+4.4%
Q1 2016+0.2%-1.8%+4.4%
Q1 2017-0.6%-3.4%+4.1%
Q3 2015
Q2 2015
Q1 2015

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