Financial Data and Key Metrics Changes - The second quarter results exceeded expectations, driven by strong demand and pricing discipline, with occupancy levels increasing compared to the first quarter [7][10] - The company reported a total unrestricted cash balance of approximately $238 million as of June 30, 2021, with no cash burn on a company-wide operational basis during the second quarter [17][18] - ADR growth in Q2 over 2019 was approximately 16%, with property EBITDA margins reaching around 26% at only 50% occupancy [54] Business Line Data and Key Metrics Changes - Mexico led the recovery with comparable occupancies in the high 50s for the quarter, and occupancy levels increased into the 60s by June [9][10] - Jamaica saw a sequential improvement in international passenger arrivals by over 30 percentage points compared to 2019, with occupancy approaching 60% in June [11] - The Dominican Republic experienced a 20% improvement in occupancy versus Q1, driven by the flagship Hyatt Ziva & Zilara Cap Cana, which achieved EBITDA margins nearing 40% [12] Market Data and Key Metrics Changes - The Pacific segment reported significant recovery, with international passenger arrivals exceeding 2019 levels in Las Cabos and Puerto Vallarta [27] - The overall performance of the Dominican Republic was weighed down by two externally managed properties, which lagged behind globally branded resorts [13][28] - The U.S. sourced approximately 77% of managed room nights, reflecting a shift in customer mix due to travel restrictions [30] Company Strategy and Development Direction - The company is focused on growing high-return opportunities leveraging direct booking capabilities and all-inclusive operating expertise [36][37] - Management is currently not pursuing ground-up development projects but is interested in turnkey resort opportunities that are under-branded and under-managed [37] - The company aims to increase consumer direct business to at least 50% by 2023, with 48.5% of room nights booked directly in Q2 2021 [13] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for the upcoming high season and 2022, citing strong competitive positioning and rate strength [35] - The company does not foresee significant impacts from the Delta variant on bookings or cancellations as of now [8] - Management acknowledged challenges in the labor market but noted that the situation is not as dire as in the U.S., with vaccination rates among employees being high in the Dominican Republic [80] Other Important Information - The company completed the sale of the Capri hotel, generating net proceeds of just under $50 million, which was partially used to pay down debt [18] - The MICE group business is showing strong demand, with approximately $14 million of group business on the books for 2021, and over $30 million for 2022 [21][22] Q&A Session Summary Question: What are the occupancy caps in Mexico and Jamaica? - Management stated that occupancy caps are not significantly impacting business, with caps at 70% in Quintana Roo and 80% in Puerto Vallarta, and they are focused on driving ADRs [40] Question: How are rates and ADRs expected to perform? - Management indicated that everyone is paying more, and they believe the current rate increases may reset a new floor for future pricing [41][42] Question: What is the outlook for EBITDA and margins? - Management expects that strong ADRs will allow for comparable pre-pandemic property EBITDA margins at lower occupancy levels, despite anticipated cost increases [54][55] Question: How are the externally managed properties performing? - The two externally managed properties are lagging due to being non-branded and reliant on higher-cost tour operator channels, but management hopes for improvement as airlift increases [56][57] Question: What is the competitive landscape like? - Management believes they are gaining market share due to the quality of their properties and service, and they are well-positioned to take advantage of any distressed opportunities that may arise [63][64]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________ FORM 10-Q _______________________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarterly period ended June 30, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. COMMISSION FILE NO. 1-38012 Playa Hotels & Resorts N.V. (Exact name of registrant as specified in its ch ...

Playa Hotels & Resorts N.V. (NASDAQ:PLYA) Q1 2021 Earnings Conference Call May 6, 2021 11:30 AM ET Company Participants Ryan Hymel – Executive Vice President and Chief Financial Officer Bruce Wardinski – Chairman and Chief Executive Officer Conference Call Participants Chris Woronka – Deutsche Bank Shaun Kelley – Bank of America Smedes Rose – Citi Patrick Scholes – Truist Securities Jonathan Jenkins – Janney Chad Beynon – Macquarie Operator Good day, and welcome to the Playa Hotels First Quarter 2021 Earnin ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________ FORM 10-Q _______________________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarterly period ended March 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. COMMISSION FILE NO. 1-38012 Playa Hotels & Resorts N.V. (Exact name of registrant as specified in its c ...

Playa Hotels & Resorts N.V. (NASDAQ:PLYA) Q4 2020 Results Conference Call March 5, 2021 10:00 AM ET Company Participants Ryan Hymel - EVP and CFO Bruce Wardinski - Chairman and CEO Conference Call Participants Chris Woronka - Deutsche Bank Patrick Scholes - Truist Securities Chad Beynon - Macquarie Smedes Rose - Citi Jonathan Jenkins - Janney Operator Good morning, and welcome to the Playa Hotels Fourth Quarter 2020 Earnings Call. All participants will be in listen-only mode. [Operator Instructions] Please ...

PART I [Business](index=8&type=section&id=Item%201.%20Business) Playa Hotels & Resorts N.V. operates 21 all-inclusive resorts in Mexico and the Caribbean, leveraging strategic brand partnerships, with 2020 operations significantly impacted by the COVID-19 pandemic Portfolio Overview as of December 31, 2020 | Metric | Value | | :--- | :--- | | Total Resorts | 21 | | Total Rooms | 8,172 | | Locations | Mexico, Jamaica, Dominican Republic | - Playa's strategy is to leverage **globally recognized brand partnerships**, such as Hyatt and Hilton, to capitalize on the high volume of U.S. visitors to its operating regions[26](index=26&type=chunk)[28](index=28&type=chunk) - The COVID-19 pandemic had a **significant adverse impact** on the business starting in the first quarter of 2020, leading to the temporary suspension of operations at all resorts[33](index=33&type=chunk) - The company emphasizes its **integrated and scalable operating platform**, which manages 18 of its resorts and is designed to improve operating efficiency and integrate new acquisitions[34](index=34&type=chunk) - As of December 31, 2020, the company employed approximately **8,000 people**, with the majority located at its resorts in Jamaica, Mexico, and the Dominican Republic, with staffing levels temporarily adjusted in 2020 due to the pandemic[66](index=66&type=chunk) [Risk Factors](index=16&type=section&id=Item%201A.%20Risk%20Factors) The company faces significant risks including the ongoing COVID-19 pandemic impact, geographic concentration, reliance on strategic partnerships, substantial debt, and a material weakness in internal controls over financial reporting - The COVID-19 pandemic is having a **significant material adverse effect** on business, results, cash flows, and financial condition, leading to **no revenues in Q2 2020** and severely reduced occupancy upon reopening[68](index=68&type=chunk)[69](index=69&type=chunk) - The company is exposed to risks from its **geographic concentration** in Mexico, Jamaica, and the Dominican Republic, including weather-related events like hurricanes[74](index=74&type=chunk) - **Critical relationships with Hyatt and Hilton** are essential, and their deterioration, failure to maintain brand standards, or termination of franchise agreements could significantly harm the business and portfolio value[77](index=77&type=chunk)[80](index=80&type=chunk)[89](index=89&type=chunk) - The company has **$1.27 billion substantial debt** as of December 31, 2020, which could restrict future operations, and its debt agreements impose significant restrictive covenants[116](index=116&type=chunk)[119](index=119&type=chunk) - A **material weakness in internal control over financial reporting related to income taxes** was identified for both 2020 and 2019, increasing the risk of a material misstatement in financial statements[134](index=134&type=chunk) [Unresolved Staff Comments](index=36&type=section&id=Item%201B.%20Unresolved%20Staff%20Comments) The company reported no unresolved staff comments from the SEC - None[180](index=180&type=chunk) [Properties](index=37&type=section&id=Item%202.%20Properties) As of December 31, 2020, the company's portfolio comprises 21 resorts with 8,172 rooms across four geographic segments, with 7,720 rooms owned and 452 managed Portfolio Summary by Status (as of Dec 31, 2020) | Category | Total Rooms | | :--- | :--- | | Total Rooms Owned | 7,720 | | Total Rooms Operated (Managed) | 452 | | **Total Rooms Owned and Operated** | **8,172** | Portfolio Breakdown by Geographic Segment (Owned Rooms) | Segment | Number of Resorts | Total Rooms | | :--- | :--- | :--- | | Yucatán Peninsula | 7 | 2,642 | | Pacific Coast | 2 | 926 | | Dominican Republic | 6 | 2,644 | | Jamaica | 5 | 1,508 | [Legal Proceedings](index=37&type=section&id=Item%203.%20Legal%20Proceedings) The company is involved in various legal claims and lawsuits, with detailed information incorporated by reference from Note 8 of the Consolidated Financial Statements - Information on legal proceedings is incorporated by reference from **Note 8 – Commitments and contingencies** in the Consolidated Financial Statements[184](index=184&type=chunk) [Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not Applicable[185](index=185&type=chunk) PART II [Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities](index=38&type=section&id=Item%205.%20Market%20for%20Registrant%27s%20Common%20Equity%2C%20Related%20Stockholder%20Matters%20and%20Issuer%20Purchases%20of%20Equity%20Securities) The company's ordinary shares trade on NASDAQ under "PLYA", with **164,029,575 shares outstanding** as of February 26, 2021, and no cash dividends paid or anticipated due to retention for operations and credit facility restrictions - The company's ordinary shares have traded on **NASDAQ under the symbol "PLYA"** since March 13, 2017[187](index=187&type=chunk) - The company has **never paid cash dividends** and does not plan to in the foreseeable future, with payments also being **restricted by its Senior Secured Credit Facility**[189](index=189&type=chunk) - In June 2020, the company sold **4,878,049 ordinary shares** to certain buyers for an aggregate purchase price of **$20.0 million**, at a price of $4.10 per share[192](index=192&type=chunk) [Selected Financial Data](index=39&type=section&id=Item%206.%20Selected%20Financial%20Data) Selected financial data for 2020 reflects a significant downturn due to COVID-19, with total revenue at **$273.2 million**, a net loss of **$262.4 million**, and **$99.9 million** net cash used in operating activities Selected Consolidated Statement of Operations Data ($ in thousands) | | 2020 | 2019 | 2018 | | :--- | :--- | :--- | :--- | | Total revenue | $273,189 | $636,477 | $617,013 | | Operating (loss) income | $(190,237) | $25,710 | $90,597 | | Net (loss) income | $(262,370) | $(4,357) | $18,977 | Selected Consolidated Balance Sheet Data ($ in thousands) | | 2020 | 2019 | 2018 | | :--- | :--- | :--- | :--- | | Total assets | $2,097,665 | $2,196,964 | $2,135,158 | | Total debt | $1,251,267 | $1,040,658 | $989,387 | | Total equity | $568,136 | $809,651 | $839,841 | Selected Consolidated Statement of Cash Flow Data ($ in thousands) | | 2020 | 2019 | 2018 | | :--- | :--- | :--- | :--- | | Net cash from Operating activities | $(99,938) | $72,188 | $114,430 | | Net cash from Investing activities | $29,412 | $(203,816) | $(204,586) | | Net cash from Financing activities | $222,455 | $36,206 | $89,280 | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=40&type=section&id=Item%207.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) The COVID-19 pandemic severely impacted 2020 performance, leading to a **57.1% decrease in total revenue** to **$273.2 million** and a **$262.4 million net loss**, prompting significant liquidity preservation measures and phased resort reopenings - The COVID-19 pandemic led to the **temporary suspension of operations** at all resorts in late March 2020, with reopenings beginning July 1, 2020, resulting in a **significant adverse impact on revenue and liquidity**[201](index=201&type=chunk)[202](index=202&type=chunk) - To mitigate the pandemic's impact, the company raised **$224.0 million in additional capital**, sold two resorts for **$60.0 million**, deferred non-critical capital expenditures, and implemented broad compensation cuts[204](index=204&type=chunk) Key Performance Indicators (Total Portfolio, 2020 vs 2019) | Metric | 2020 | 2019 | % Change | | :--- | :--- | :--- | :--- | | Occupancy | 26.9% | 77.3% | (65.2)% | | Net Package RevPAR | $76.61 | $198.28 | (61.4)% | | Total Net Revenue ($M) | $262.9 | $607.2 | (56.7)% | | Adjusted EBITDA ($M) | $(21.2) | $150.7 | (114.1)% | - As of December 31, 2020, the company had **$146.9 million of available cash** (excluding restricted cash) and **$1.27 billion total debt obligations**[270](index=270&type=chunk)[273](index=273&type=chunk) - Critical accounting policies and estimates involve **significant judgment**, particularly in areas like business combinations, impairment of property and goodwill, and income taxes[292](index=292&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=62&type=section&id=Item%207A.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to interest rate risk, with **23% of debt at floating rates**, and foreign currency risk, where a **5% adverse change** could impact pre-tax net income by approximately **$10.5 million** annually - The company is exposed to interest rate risk, with **23% of its outstanding debt at floating rates** as of year-end 2020, where a **1.0% increase** in rates would result in an approximate **$1.2 million** annual increase in interest expense[313](index=313&type=chunk) - The company faces **foreign currency risk** as approximately **79.5% of its 2020 operating expenses** were denominated in local currencies, while revenues are primarily in U.S. dollars[315](index=315&type=chunk) - A hypothetical **5% adverse change** in foreign exchange rates would have impacted 2020 net income before tax by approximately **$5.0 million** (Mexican Peso), **$2.3 million** (Dominican Peso), and **$3.2 million** (Jamaican Dollar)[316](index=316&type=chunk) [Financial Statements and Supplementary Data](index=63&type=section&id=Item%208.%20Financial%20Statements%20and%20Supplementary%20Data) This section presents the audited consolidated financial statements for 2020, including an unqualified opinion on financials but an adverse opinion on internal control over financial reporting due to a material weakness in income tax provision - The independent auditor, Deloitte & Touche LLP, issued an **unqualified opinion on the financial statements** but an **adverse opinion on the effectiveness of internal control over financial reporting** as of December 31, 2020[322](index=322&type=chunk)[333](index=333&type=chunk) - The auditor identified a **material weakness in internal control over financial reporting**, stating that the company's control activities related to its **income tax provision** did not operate with a level of precision that would identify a material misstatement[339](index=339&type=chunk) Consolidated Balance Sheet Highlights ($ in thousands) | | Dec 31, 2020 | Dec 31, 2019 | | :--- | :--- | :--- | | Cash and cash equivalents | $146,919 | $20,931 | | Total Assets | $2,097,665 | $2,196,964 | | Total Debt | $1,251,267 | $1,040,658 | | Total Shareholders' Equity | $568,136 | $809,651 | Consolidated Statement of Operations Highlights ($ in thousands) | | 2020 | 2019 | 2018 | | :--- | :--- | :--- | :--- | | Total revenue | $273,189 | $636,477 | $617,013 | | Operating (loss) income | $(190,237) | $25,710 | $90,597 | | Net (loss) income | $(262,370) | $(4,357) | $18,977 | [Changes in and Disagreements with Accountants on Accounting and Financial Disclosure](index=115&type=section&id=Item%209.%20Changes%20in%20and%20Disagreements%20With%20Accountants%20on%20Accounting%20and%20Financial%20Disclosure) The company reported no changes in or disagreements with its accountants on accounting and financial disclosure - None[557](index=557&type=chunk) [Controls and Procedures](index=115&type=section&id=Item%209A.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were not effective as of December 31, 2020, due to a material weakness in internal control over financial reporting related to the income tax provision, with a remediation plan initiated - Management concluded that disclosure controls and procedures were **not effective** as of December 31, 2020[559](index=559&type=chunk) - A **material weakness** was identified in internal control over financial reporting: "The control activities related to our **income tax provision** did not operate with a level of precision that would identify a material misstatement"[561](index=561&type=chunk) - The company has initiated a **remediation plan** that includes hiring additional resources and implementing enhanced policies, procedures, and controls for income tax accounting[563](index=563&type=chunk) [Other Information](index=116&type=section&id=Item%209B.%20Other%20Information) The company reported no other information for this item - None[566](index=566&type=chunk) PART III [Directors, Executive Officers and Corporate Governance](index=117&type=section&id=Item%2010.%20Directors%2C%20Executive%20Officers%20and%20Corporate%20Governance) Information on directors, executive officers, and corporate governance is incorporated by reference from the company's 2021 Annual General Meeting of Shareholders Proxy Statement - Information is **incorporated by reference** to the Company's Proxy Statement for the 2021 Annual General Meeting of Shareholders[569](index=569&type=chunk) [Executive Compensation](index=117&type=section&id=Item%2011.%20Executive%20Compensation) Information on executive compensation is incorporated by reference from the company's 2021 Annual General Meeting of Shareholders Proxy Statement - Information is **incorporated by reference** to the Company's Proxy Statement for the 2021 Annual General Meeting of Shareholders[570](index=570&type=chunk) [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters](index=117&type=section&id=Item%2012.%20Security%20Ownership%20of%20Certain%20Beneficial%20Owners%20and%20Management%20and%20Related%20Stockholder%20Matters) Information on security ownership is incorporated by reference from the 2021 Proxy Statement, with **8,043,686 securities** available for future issuance under equity compensation plans as of December 31, 2020 - Information is **incorporated by reference** to the Company's Proxy Statement for the 2021 Annual General Meeting of Shareholders[571](index=571&type=chunk) Securities Authorized for Issuance Under Equity Compensation Plans (as of Dec 31, 2020) | Plan Category | Securities remaining for future issuance | | :--- | :--- | | Equity compensation plans approved by security holders | 8,043,686 | | Total | 8,043,686 | [Certain Relationships and Related Transactions, and Director Independence](index=117&type=section&id=Item%2013.%20Certain%20Relationships%20and%20Related%20Transactions%2C%20and%20Director%20Independence) Information on certain relationships, related transactions, and director independence is incorporated by reference from the company's 2021 Annual General Meeting of Shareholders Proxy Statement - Information is **incorporated by reference** to the Company's Proxy Statement for the 2021 Annual General Meeting of Shareholders[574](index=574&type=chunk) [Principal Accountant Fees and Services](index=117&type=section&id=Item%2014.%20Principal%20Accountant%20Fees%20and%20Services) Information on principal accountant fees and services is incorporated by reference from the company's 2021 Annual General Meeting of Shareholders Proxy Statement - Information is **incorporated by reference** to the Company's Proxy Statement for the 2021 Annual General Meeting of Shareholders[575](index=575&type=chunk) PART IV [Exhibits and Financial Statement Schedules](index=118&type=section&id=Item%2015.%20Exhibits%20and%20Financial%20Statement%20Schedules) This section lists financial statements, schedules, and exhibits filed with the Annual Report on Form 10-K, including corporate governance documents and material contracts - This section contains a list of **all financial statements, schedules, and exhibits** filed with the 10-K[578](index=578&type=chunk)[585](index=585&type=chunk) [Form 10-K Summary](index=121&type=section&id=Item%2016.%20Form%2010-K%20Summary) This item is not applicable to the company's filing - Not applicable[588](index=588&type=chunk)

Playa Hotels & Resorts N.V. (NASDAQ:PLYA) Q3 2020 Earnings Conference Call November 5, 2020 10:00 AM ET Company Participants Ryan Hymel - EVP and CFO Bruce Wardinski - Chairman and CEO Conference Call Participants Chris Woronka - Deutsche Bank Tyler Batory - Janney's Capital Market Smedes Rose - Citi Bank Aaron Lee - Macquarie Gregory Miller - Truist Securities Operator Ladies and gentlemen, thank you for standing by, and welcome to Q3 2020 Earnings Conference Call. At this time, all participants are in a ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ___________________________________________________ FORM 10-Q _______________________________________________ ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For quarterly period ended September 30, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. COMMISSION FILE NO. 1-38012 Playa Hotels & Resorts N.V. (Exact name of registrant as specified in i ...

Financial Data and Key Metrics Changes - The company reported a cash balance of $280 million as of June 30, 2020, which includes approximately $28 million in restricted cash [30] - Monthly cash burn was approximately $20 million in a zero revenue environment, but this is expected to decrease as two-thirds of resorts are currently open [44] - The company’s property level cash burn was approximately $8 million to $9 million per month while closed, with expectations for improvement as resorts reopen [43] Business Line Data and Key Metrics Changes - Direct bookings accounted for 51.6% of room nights booked in Q2 2020, up 23 percentage points year-over-year, indicating a strong performance in direct channels [16] - The company’s direct-to-consumer website generated $32.5 million in gross revenue for 2020, down from $47.5 million in 2019 [17] - The MICE (Meetings, Incentives, Conferences, and Exhibitions) business saw approximately 51% of 2020 group business impacted by the crisis, with a significant portion rebooking for later dates [28] Market Data and Key Metrics Changes - The U.S. source business increased to 80% of all business booked, while Mexico-based business rose to 13% [35] - The company noted that airlift to Mexico, particularly Cancun, is performing better than Jamaica and the Dominican Republic, which are still experiencing significant reductions in flight availability [83] - The company’s revenue on the books for Q4 2020 is down approximately 30% compared to the previous year, with declines evenly split between Jamaica and Mexico [39] Company Strategy and Development Direction - The company is focused on growing direct bookings and reducing customer acquisition costs, aiming to increase direct business to at least 50% by 2023 [16] - The company is exploring opportunities for consolidation in the all-inclusive space, particularly targeting family-owned operators that may struggle financially [67] - The company plans to enhance its health and wellness offerings and has introduced a unique extended stay program called "Work & Learn From Paradise" [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery of leisure travel, noting that pent-up demand is evident, especially in Mexico [53] - The company is confident in its ability to maintain rate integrity, emphasizing the safety and experience offered at its resorts compared to competitors [52] - Management acknowledged the uncertainty in the market but remains hopeful for a rebound as travel restrictions ease and consumer confidence builds [45] Other Important Information - The company raised a total of $224 million in June through various financing methods to enhance liquidity [22] - The company has suspended share repurchase activity for the time being due to the current environment [33] - Incremental capital raised will increase interest expense by nearly $5 million per quarter going forward [25] Q&A Session Summary Question: How do you think the rate integrity holds up? - Management believes that rate is not a major concern as travelers prioritize safety and experience, and they expect occupancy to build over time [52][54] Question: What is the outlook for family-owned private companies in the market? - Management sees opportunities for consolidation as many family-owned operators may struggle financially, which could benefit Playa [67] Question: What are the expectations for EBITDA margins post-pandemic? - Management indicated it is too early to tell, but they expect some operational efficiencies to emerge as they ramp up operations [68] Question: What are the current trends in market share gains? - Management noted strong direct booking numbers and believes they will continue to perform well compared to competitors reliant on tour operators [76] Question: What is the booking window and cancellation trend? - The booking window has compressed to 30-45 days, with cancellations occurring closer to the date of stay, reflecting the flexibility in the current environment [81]

[PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section presents the company's financial statements, management's analysis of performance and condition, market risk disclosures, and internal controls for the period ended June 30, 2020 [Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company's financial statements for the period ending June 30, 2020, reflect a severe negative impact from the COVID-19 pandemic, leading to a dramatic decline in revenue, a significant net loss of **$110.0 million** for the first six months, and negative cash flow from operations Condensed Consolidated Balance Sheet Highlights | Balance Sheet Item | June 30, 2020 ($ in thousands) | Dec 31, 2019 ($ in thousands) | Change | | :--- | :--- | :--- | :--- | | Cash and cash equivalents | 251,022 | 20,931 | +1,099% | | Total assets | 2,267,264 | 2,196,964 | +3.2% | | Debt | 1,251,877 | 1,040,658 | +20.3% | | Total liabilities | 1,556,706 | 1,387,313 | +12.2% | | Total shareholders' equity | 710,558 | 809,651 | -12.2% | Condensed Consolidated Statement of Operations Highlights | Metric | Three Months Ended June 30, 2020 ($ in thousands) | Three Months Ended June 30, 2019 ($ in thousands) | Six Months Ended June 30, 2020 ($ in thousands) | Six Months Ended June 30, 2019 ($ in thousands) | | :--- | :--- | :--- | :--- | :--- | | Total revenue | 982 | 164,023 | 178,210 | 359,819 | | Operating (loss) income | (86,042) | 10,334 | (82,626) | 57,571 | | Net (loss) income | (87,458) | 1,040 | (110,014) | 44,028 | | (Losses) earnings per share - Diluted | (0.67) | 0.01 | (0.85) | 0.34 | Condensed Consolidated Statement of Cash Flows Highlights (Six Months Ended) | Cash Flow Activity | June 30, 2020 ($ in thousands) | June 30, 2019 ($ in thousands) | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | (28,396) | 86,076 | | Net cash provided by (used in) investing activities | 58,862 | (88,947) | | Net cash provided by (used in) financing activities | 227,544 | (8,972) | | **Increase (Decrease) in Cash** | **258,010** | **(11,843)** | [Notes to the Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the severe impact of COVID-19, leading to the suspension of all 21 resorts from March to June 2020, prompting the sale of two resorts for **$60.0 million**, **$224.0 million** in new debt and equity, and a **$41.5 million** total impairment charge - Due to the COVID-19 pandemic, all of the company's 21 resorts temporarily suspended operations from late March through June 2020, with reopening beginning in stages on July 1, 2020, and 12 of 21 resorts open as of the report date[26](index=26&type=chunk) - To improve liquidity, the company sold two Jewel brand resorts for **$60.0 million**, raised additional capital through equity and debt, amended its Senior Secured Credit Facility to waive financial covenants until September 30, 2021, and significantly reduced staffing and capital expenditures[29](index=29&type=chunk)[41](index=41&type=chunk) - On June 12, 2020, the company entered into new debt agreements, including an Additional Credit Facility for **$94.0 million** and a Property Loan for **$110.0 million**, to bolster its financial position[76](index=76&type=chunk)[77](index=77&type=chunk)[81](index=81&type=chunk) - The company recognized a **$25.3 million** impairment loss on the Jewel Dunn's River and Jewel Runaway Bay resorts upon their classification as held for sale, with an additional **$16.2 million** goodwill impairment recorded in Q1 2020 due to decreased future cash flow forecasts caused by COVID-19[41](index=41&type=chunk)[99](index=99&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=30&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the unprecedented impact of the COVID-19 pandemic, causing a **99.4%** Q2 2020 revenue decrease, a **$87.5 million** net loss, and an Adjusted EBITDA loss of **$31.4 million**, while detailing liquidity preservation actions including **$224.0 million** in new capital and **$60.0 million** from resort sales [Impact of COVID-19 Pandemic and Overview](index=31&type=section&id=Impact%20of%20COVID-19%20Pandemic%20and%20Overview) The COVID-19 pandemic forced temporary suspension of all 21 resorts, causing near-total Q2 revenue loss, prompting **$224.0 million** in additional capital, **$60.0 million** from resort sales, and significant cost reductions to mitigate liquidity impact - All company resorts were temporarily closed from late March 2020 until July 1, 2020, due to the COVID-19 pandemic, with 12 out of 21 resorts having reopened as of the report date[127](index=127&type=chunk)[128](index=128&type=chunk) - To manage liquidity during the shutdown, the company raised **$224.0 million** in new debt and equity financing, sold two resorts for **$60.0 million**, borrowed an additional **$40.0 million** under its Revolving Credit Facility, and deferred all non-critical capital expenditures for 2020[129](index=129&type=chunk) [Results of Operations](index=36&type=section&id=Results%20of%20Operations) Q2 2020 total revenue plummeted **99.4%** to **$1.0 million**, resulting in an **$87.5 million** net loss, while H1 revenue fell **50.5%** to **$178.2 million** with a **$110.0 million** net loss, driven by resort closures, significant impairment losses, and increased interest expense Q2 2020 vs Q2 2019 Performance (Total Portfolio) | Metric | Q2 2020 | Q2 2019 | % Change | | :--- | :--- | :--- | :--- | | Occupancy | — % | 79.8% | (100.0)% | | Net Package RevPAR | $ — | $205.55 | (100.0)% | | Total Net Revenue | $0.5M | $155.5M | (99.7)% | | Adjusted EBITDA | $(31.4)M | $40.1M | (178.4)% | H1 2020 vs H1 2019 Performance (Total Portfolio) | Metric | H1 2020 | H1 2019 | % Change | | :--- | :--- | :--- | :--- | | Occupancy | 33.6% | 79.9% | (57.9)% | | Net Package RevPAR | $100.01 | $225.37 | (55.6)% | | Total Net Revenue | $171.7M | $344.4M | (50.1)% | | Adjusted EBITDA | $18.9M | $114.8M | (83.5)% | - Impairment losses for H1 2020 totaled **$41.4 million**, driven by a **$25.3 million** charge on two resorts classified as held for sale and a **$16.2 million** goodwill impairment due to reduced cash flow forecasts from COVID-19[174](index=174&type=chunk)[154](index=154&type=chunk) - Interest expense for Q2 2020 increased by **$10.3 million (96.1%)** YoY, primarily due to a **$5.9 million** charge from the change in fair value of interest rate swaps which became ineffective in March 2020[155](index=155&type=chunk) [Segment Results](index=51&type=section&id=Segment%20Results) All geographic segments experienced near-total revenue collapse and significant EBITDA losses in Q2 2020 due to system-wide resort closures, with H1 EBITDA seeing dramatic year-over-year declines ranging from **68% to 84%** across segments Owned Resort EBITDA by Segment (Three Months Ended June 30) | Segment | 2020 ($ in thousands) | 2019 ($ in thousands) | % Change | | :--- | :--- | :--- | :--- | | Yucatán Peninsula | (8,004) | 21,151 | (137.8)% | | Pacific Coast | (2,816) | 8,569 | (132.9)% | | Dominican Republic | (4,881) | 5,043 | (196.8)% | | Jamaica | (8,097) | 14,631 | (155.3)% | | **Total Segment** | **(23,798)** | **49,394** | **(148.2)%** | Owned Resort EBITDA by Segment (Six Months Ended June 30) | Segment | 2020 ($ in thousands) | 2019 ($ in thousands) | % Change | | :--- | :--- | :--- | :--- | | Yucatán Peninsula | 16,931 | 53,310 | (68.2)% | | Pacific Coast | 6,056 | 20,956 | (71.1)% | | Dominican Republic | 2,908 | 18,506 | (84.3)% | | Jamaica | 10,976 | 38,979 | (71.8)% | | **Total Segment** | **36,871** | **131,751** | **(72.0)%** | [Liquidity and Capital Resources](index=61&type=section&id=Liquidity%20and%20Capital%20Resources) The company's liquidity was severely impacted by the pandemic, with operating cash flow turning negative to **($28.4) million** for H1 2020, addressed by raising **$224.0 million** in new capital, selling two resorts for **$60.0 million**, and ending the quarter with **$251.0 million** in cash - As of July 31, 2020, the company had approximately **$228.0 million** of available cash, excluding **$25.7 million** of restricted cash[239](index=239&type=chunk) - On June 12, 2020, the company raised **$224.0 million** of additional capital through **$204.0 million** in debt financing and **$20.0 million** in equity financing[241](index=241&type=chunk) - The share repurchase program has been suspended to preserve cash, with approximately **$83.5 million** remaining under the authorization as of June 30, 2020[252](index=252&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=66&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to interest rate risk, with **23%** of debt at floating rates, where a **1.0%** increase would raise annual interest expense by approximately **$1.2 million**, and foreign currency risk due to **81.1%** of operating expenses being denominated in local currencies - As of June 30, 2020, **23%** of the company's debt bore floating interest rates, where a hypothetical **1.0%** increase in market rates would increase annual interest expense by approximately **$1.2 million**[275](index=275&type=chunk) - Approximately **81.1%** of operating expenses for H1 2020 were denominated in local currencies (Mexican Peso, Dominican Peso, Jamaican Dollar), creating exposure to foreign currency risk[277](index=277&type=chunk) [Controls and Procedures](index=67&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2020, with no material changes to internal control over financial reporting during the quarter - The Principal Executive Officer and Principal Financial Officer concluded that the company's disclosure controls and procedures were effective as of June 30, 2020[280](index=280&type=chunk) [PART II. OTHER INFORMATION](index=68&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section details additional information including new risk factors related to the COVID-19 pandemic and the unregistered sale of equity securities [Risk Factors](index=68&type=section&id=Item%201A.%20Risk%20Factors) This section adds a significant risk factor detailing the material adverse effects of the COVID-19 pandemic, highlighting the unprecedented impact on the hospitality industry, resort closures, revenue loss, and the need to service substantial debt with severely reduced cash flow - A new, detailed risk factor was added to address the significant material adverse effects of the COVID-19 pandemic on the business, including resort closures, revenue loss, and uncertainty about the recovery of travel demand[285](index=285&type=chunk)[286](index=286&type=chunk) - Specific risks highlighted include the ability to service substantial debt with reduced cash flow, reliance on the recovery of commercial airline service, potential for non-cash impairment charges, and risks related to employee matters following terminations and furloughs[288](index=288&type=chunk)[294](index=294&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=69&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) On June 12, 2020, the company sold **4,878,049** ordinary shares in a private placement for **$20.0 million** at **$4.10** per share to affiliates of Davidson Kempner Capital Management LP, exempt from registration under the Securities Act - On June 12, 2020, the company sold **4,878,049** ordinary shares in a private placement for an aggregate price of **$20.0 million** (**$4.10** per share)[289](index=289&type=chunk)