Sunstone Hotel Investors, Inc. (NYSE:SHO) Q2 2020 Earnings Conference Call August 4, 2020 12:00 PM ET Company Participants Aaron Reyes – Vice President-Corporate Finance and Treasurer John Arabia – President and Chief Executive Officer Bryan Giglia – Executive Vice President and Chief Financial Officer Conference Call Participants Lukas Hartwich – Green Street Advisors David Katz – Jefferies Anthony Powell – Barclays Dori Kesten – Wells Fargo Bill Crow – Raymond James Rich Hightower – Evercore Chris Woronka ...

Supplemental Financial Information | --- | --- | --- | |------------------------------------------------------|-------|----------------| | | | August 4, 2020 | | | | | | | | | | Supplemental Financial Information | | | | For the quarter ended June 30, 2020 August 4, 2020 | | | Supplemental Financial Information August 4, 2020 CORPORATE PROFILE, FINANCIAL DISCLOSURES, AND SAFE HARBOR 3 About Sunstone 4 Forward-Looking Statement 5 Non-GAAP Financial Measures 6 CORPORATE FINANCIAL INFORMATION 9 Condensed Conso ...

Sunstone Hotel Investors, Inc. (NYSE:SHO) Q1 2020 Earnings Conference Call May 8, 2020 12:00 PM ET Company Participants Aaron Reyes - VP, Corporate Finance & Treasurer John Arabia - President & CEO Bryan Giglia - CFO Conference Call Participants Lukas Hartwich - Green Street Advisors Anthony Powell - Barclays Shaun Kelly - Bank of America Chris Woronka - Deutsche Bank Smedes Rose - Citi Michael Bellisario - Baird Stephen Grambling - Goldman Sachs David Katz - Jefferies Bill Crow - Raymond James Patrick Scho ...

Supplemental Financial Information | --- | --- | --- | |-----------------------------------------------------------------------------------------|-------|-------------| | | | May 8, 2020 | | | | | | | | | | | | | | Supplemental Financial Information For the quarter ended March 31, 2020 May 8, 2020 | | | Supplemental Financial Information May 8, 2020 CORPORATE PROFILE, FINANCIAL DISCLOSURES, AND SAFE HARBOR 2 About Sunstone 3 Forward-Looking Statement 4 Non-GAAP Financial Measures 5 CORPORATE FINANCIAL INFOR ...

Financial Data and Key Metrics Changes - In Q4 2019, comparable portfolio RevPAR increased by 80 basis points year-over-year, while total revenues rose by 2.1%, leading to full-year RevPAR growth of 1.9% and total revenue growth of 2.9% [13][14] - Full-year adjusted EBITDA and adjusted FFO per diluted share exceeded the high end of guidance, despite ongoing cost pressures [15][30] Business Line Data and Key Metrics Changes - Transient room revenue grew approximately 3% in 2019, while group revenue remained flat [14] - Food and beverage revenues increased by 2.6%, and ancillary property level revenues surged by 14% in Q4 [14] Market Data and Key Metrics Changes - The Wailea market continued to show strong RevPAR index gains, while markets like Chicago, Portland, and New York City experienced general weakness [16][18] - December 2019 saw better-than-expected operating trends, particularly in Wailea, Long Beach, Chicago, and San Francisco [18] Company Strategy and Development Direction - The company plans to focus on long-term relevant real estate and has increased its share repurchase program from $300 million to $500 million, indicating a preference for buying back shares over acquisitions [26][28] - Limited capital expenditures are expected in 2020, with a focus on strategic renovations, such as the Marriott Portland [22][90] Management's Comments on Operating Environment and Future Outlook - The operating environment for 2020 is expected to be similar to 2019, with limited RevPAR growth anticipated across most markets [20] - The company is monitoring the potential impact of the Coronavirus on travel and hotel demand, although current expectations do not include significant negative impacts [23][57] Other Important Information - The company disposed of the leasehold interest in the Courtyard LAX for $50 million, consolidating its portfolio and reducing ground lease exposure [11][12] - A $0.05 per common share dividend has been declared for Q1 2020, with expectations to maintain this throughout the year [32] Q&A Session Summary Question: Impact of hotel values due to weak fundamentals - Management noted that high-quality assets still attract strong bids, while commodity assets face more challenges [36] Question: Wailea Beach Resort's ADR Index - The ADR Index gap has improved from $280 behind the luxury set in 2014 to $180 behind at the end of 2019 [37] Question: Hilton Times Square property tax increases - Management discussed significant property tax pressures and a disputed ground rent increase, which could impact margins [42][43] Question: Transient demand trends - Management observed better transient demand in December, with an uptick in both corporate and leisure bookings [48] Question: Share repurchase strategy - The company emphasized that share repurchases are a capital allocation tool rather than a signaling mechanism [84] Question: CapEx spending trends - Management indicated that lower projected CapEx spending is due to postponed renovations and a well-maintained portfolio [90]

Sunstone Hotel Investors, Inc. (NYSE:SHO) Q3 2019 Earnings Conference Call November 5, 2019 12:00 PM ET Company Participants Aaron Reyes - VP, Corporate Finance & Treasurer John Arabia - President, CEO & Director Bryan Giglia - EVP & CFO Marc Hoffman - EVP & COO Robert Springer - EVP & CIO John Arabia - President, CEO & Director Bryan Giglia - EVP & CFO Conference Call Participants Lukas Hartwich - Green Street Advisors Anthony Powell - Barclays Bank Michael Bellisario - Robert W. Baird & Co. Smedes Rose - ...

Supplemental Financial Information | --- | --- | --- | |-----------------------------------------------------------------------------------------|-------|----------------| | | | August 1, 2019 | | | | | | | | | | | | | | Supplemental Financial Information For the quarter ended June 30, 2019 August 1, 2019 | | | Supplemental Financial Information August 1, 2019 HIDDEN_ROW CORPORATE PROFILE, FINANCIAL DISCLOSURES, AND SAFE HARBOR 3 About Sunstone 4 Forward-Looking Statement 5 Non-GAAP Financial Measures 6 COR ...

Sunstone Hotel Investors, Inc. (NYSE:SHO) Q2 2019 Earnings Conference Call August 2, 2019 12:00 PM ET Company Participants Aaron Reyes - VP, Corporate Finance & Treasurer John Arabia - President, CEO & Director Bryan Giglia - EVP & CFO Marc Hoffman - EVP & COO Robert Springer - EVP & CIO Conference Call Participants Anthony Powell - Barclays Bank Michael Bellisario - Robert W. Baird & Co. Chris Woronka - Deutsche Bank Bennett Rose - Citigroup Richard Hightower - Evercore ISI David Katz - Jefferies Stephen G ...

Sunstone Hotel Investors, Inc. (NYSE:SHO) Q1 2019 Results Conference Call May 7, 2019 12:00 PM ET Company Participants Aaron Reyes - VP, Corporate Finance John Arabia - President and CEO Bryan Giglia - CFO Robert Springer - CIO Marc Hoffman - COO Conference Call Participants Lukas Hartwich - Green Street Advisors Jeff Donnelly - Wells Fargo Anthony Powell - Barclays Smedes Rose - Citi Chris Woronka - Deutsche Bank Dany Asad - Bank of America Michael Bellisario - Baird Operator Good morning, ladies and gentl ...

Financial Data and Key Metrics Changes - In 2018, the company achieved better than expected operating results and earnings, with RevPAR and comparable property level revenues for 21 hotels increasing by 5.6% in Q4, and full year RevPAR growth at 2.8% [22][23] - Adjusted EBITDA and adjusted FFO per diluted share exceeded the high end of guidance for both Q4 and the full year [24] - The company ended 2018 with over $680 million in total adjusted unrestricted cash and a $500 million undrawn revolving credit facility [37] Business Line Data and Key Metrics Changes - The company sold six non-core hotels for a total of $353 million, improving portfolio quality and providing financial flexibility [11][13] - Comparable hotel EBITDA growth increased by 7% in Q4 and by 2% for the full year, despite cost pressures in wages, benefits, and property taxes [23][25] - The company completed over $150 million in capital improvements across its portfolio, enhancing long-term earnings prospects [16] Market Data and Key Metrics Changes - The company expects modest growth in portfolio RevPAR and total hotel revenues in 2019, with specific markets like Boston, Chicago, and Washington, D.C. facing headwinds [28][30] - The group pace for 2019 was up nearly 1%, with 76% of group rooms already booked [30] Company Strategy and Development Direction - The company aims to concentrate its portfolio on long-term relevant real estate, with plans to methodically dispose of non-core assets while seeking strategic acquisitions [10][35] - The management is cautious about current pricing expectations for high-quality assets, indicating a preference for patience in investment decisions [32][34] Management's Comments on Operating Environment and Future Outlook - The management anticipates continued cost pressures in wages and benefits, making it challenging to maintain hotel EBITDA margins [27] - The company expects to see strong performance in markets like San Francisco and Wailea, while facing challenges in others [28][30] Other Important Information - The company declared a $0.05 per common share dividend for Q1 2019, with an annual dividend yield of approximately 4.8% for 2018 [43][44] - The company invested over $4 million in environmental and sustainability projects in 2018, with plans for further investments in 2019 [20][21] Q&A Session Summary Question: Can you provide specifics on the assumptions made in the 2019 budget regarding payroll costs and RevPAR growth? - The company expects salary and wages to increase by 3% to 5%, with benefits slightly higher, and anticipates strong performance in Q1 driven by San Francisco [48][49] Question: What drove the stronger performance in San Francisco? - The first quarter is expected to be particularly strong due to group bookings and a favorable market environment [51] Question: Can you elaborate on the wage adjustments made in 2018? - Wage adjustments were broad-based, driven by market conditions and the need to retain quality staff, with increases of about 4% to 5% in 2018 [60][64] Question: How has the government shutdown impacted the company? - The company experienced several hundred thousand dollars in revenue loss due to the shutdown, which has been factored into the Q1 guidance [112] Question: What is the company's view on buybacks in the current cycle? - The management sees buybacks as an important capital allocation tool and is considering it as part of their strategy [76] Question: How does the company view its position for potential M&A? - The company believes it is well-positioned for M&A opportunities, but any acquisition must align with its strategic objectives [127][128]