Park Hotels & Resorts(US:PK)2025-11-03 21:17Company Overview - Park Hotels & Resorts Inc. has interests in 38 hotels with over 24,000 rooms, of which over 87% are luxury and upper upscale [74]. Financial Performance - The company reported a net loss of $14 million for Q3 2025, compared to a net income of $57 million in Q3 2024 [92]. - Adjusted EBITDA for Q3 2025 was $130 million, down from $159 million in Q3 2024 [92]. - Hotel Adjusted EBITDA for the nine months ended September 30, 2025, was $483 million, compared to $536 million for the same period in 2024 [92]. - Nareit FFO attributable to stockholders for Q3 2025 was $45 million, a decrease from $82 million in Q3 2024, representing a decline of 45.1% [97]. - Adjusted FFO attributable to stockholders for Q3 2025 was $70 million, down from $102 million in Q3 2024, reflecting a decrease of 31.4% [97]. - Rooms revenue for Q3 2025 was $370 million, a decrease of $33 million or 8.2% compared to $403 million in Q3 2024 [100]. - Food and beverage revenue for Q3 2025 was $150 million, down $7 million or 4.5% from $157 million in Q3 2024 [100]. - The company reported a net (loss) income attributable to stockholders of $(16) million for Q3 2025, compared to $54 million in Q3 2024 [97]. - The company’s total rooms revenue for the nine months ended September 30, 2025, was $1,134 million, down $59 million or 4.9% from $1,193 million in the same period of 2024 [102]. Operational Highlights - The company operates through two segments: consolidated hotels and unconsolidated hotels, with consolidated hotels being the only reportable segment [77]. - The New York Hilton Midtown saw a 27.7% increase in food and beverage revenue for Q3 2025 compared to Q3 2024, primarily due to increased banquet and catering revenue [106]. - The Caribe Hilton in Puerto Rico experienced a 15.5 percentage point increase in occupancy for Q3 2025 compared to Q3 2024 [107]. Expenses and Impairments - General and administrative expenses for Q3 2025 remained flat at $11 million compared to Q3 2024 [110]. - Total corporate general and administrative expenses for the nine months ended September 30, 2025, increased by 3.8% to $54 million from $52 million in the same period of 2024 [110]. - The company recognized an impairment loss of approximately $70 million related to the Hyatt Centric Fisherman's Wharf during the nine months ended September 30, 2025, compared to an impairment loss of approximately $12 million in the same period of 2024 [111]. - Depreciation expense increased due to accelerated depreciation from renovations, including approximately $56 million for the Royal Palm South Beach Miami renovation that began in May 2025 [112]. Cash Flow and Investments - Net cash provided by operating activities decreased by 16.0% to $293 million for the nine months ended September 30, 2025, compared to $349 million in the same period of 2024 [129]. - The company used $113 million in net cash for investing activities during the nine months ended September 30, 2025, primarily due to $188 million of capital expenditures [131]. - The company repurchased approximately 3.5 million shares of common stock for a total purchase price of $45 million during the nine months ended September 30, 2025 [128]. Debt and Financial Position - As of September 30, 2025, total indebtedness was approximately $3.8 billion, including over $2 billion of Senior Notes [137]. - The company ceased making debt service payments on a $725 million SF Mortgage Loan since June 2023 [137]. - As of September 30, 2025, the company had total cash and cash equivalents of $278 million and $31 million of restricted cash [123]. Market Conditions and Outlook - Economic disruptions, including elevated interest and inflation rates, may adversely affect consumer sentiment and travel demand [78]. - The company is cautiously optimistic for the remainder of 2025 based on expected improvements in group demand and benefits from renovations [78]. - The company aims to enhance asset value through single-asset and portfolio acquisitions and dispositions [75]. - Revenue per Available Room (RevPAR) is a key performance indicator, reflecting occupancy and average daily rate (ADR) trends [81]. - The company is exposed to market risk primarily from changes in interest rates, which may affect future income and cash flows [139]. - Financial arrangements may be sought to hedge against cash flow volatility associated with interest rate changes [139]. Dividends - The company declared a third quarter dividend of $0.25 per share, paid on October 15, 2025, and a fourth quarter dividend of $0.25 per share to be paid on January 15, 2026 [125]. Accounting Policies - There have been no material changes to critical accounting policies or methods since the last annual report [138].