Ryman Hospitality Properties(RHP)2023-02-24 18:30Financial Data and Key Metrics Changes - In Q4 2022, the company generated total revenue of $568.9 million, with net income to common shareholders at $58.1 million or $1.03 per fully diluted share, representing a growth of 12.3% over 2022 and 14.5% over 2019 [64][65] - The hospitality margin in Q4 was 31.1%, which was 30 basis points less than Q4 2019 but flat when excluding the decline in interest income on the Gaylord National bonds [23] - Total consolidated adjusted EBITDAre for Q4 was $168.1 million, exceeding the high end of the recent guidance by over $17 million [55] Business Line Data and Key Metrics Changes - The hospitality segment delivered $150.1 million of adjusted EBITDAre in Q4, with full-year profitability $12.7 million above the high end of the last guidance range for 2022 [45] - Same-store revenue for the hospitality segment was up 35%, and same-store adjusted EBITDAre was up 62% compared to Q4 2019 [38] - The entertainment segment's adjusted EBITDAre for 2022 was projected to be between $87 million to $97 million, significantly transforming compared to 2019 [40] Market Data and Key Metrics Changes - The company entered 2023 with 49.8% net group occupancy points on the books, 4 points higher than the start of 2022, and an ADR of $222, which is 5% higher than the start of 2022 [33] - The company noted that three of its five markets (Orlando, Nashville, and Dallas) were in the top 7 large metro areas for population growth over the last five years [37] Company Strategy and Development Direction - The company aims to induce transient demand through innovative programs and has seen significant recovery and transformation post-pandemic [20][29] - The strategy includes significant capital investments in expanding and upgrading assets against limited new supply, with a focus on high-quality, purpose-built assets [27][37] - The company is also investing in food and beverage improvements and sustainability initiatives, such as solar panel installations [118] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the recovery trajectory, with expectations for RevPAR growth of 9% to 12% and total RevPAR growth of 6.5% to 9.5% for 2023 [34] - The company anticipates continued headwinds from wage rate increases but expects to offset these through productivity gains and pricing strategies [100][87] - Management highlighted a strong lead volume for group bookings and a positive outlook for the corporate segment [72][112] Other Important Information - The company declared a quarterly dividend of $0.75 per share, a significant increase from the previous $0.25 [58] - The company ended the quarter with $334.2 million of unrestricted cash and a $700 million revolving credit facility that remained undrawn, indicating strong liquidity [66] Q&A Session All Questions and Answers Question: Expectations for cancellation and attrition fees this year - The company expects cancellation and attrition fees to be in the $20 million to $25 million range, a substantial reduction from the previous year [70] Question: Guidance for the second half of the year - Management indicated that as the year progresses, comparisons to 2019 will become tougher, suggesting potential flattish performance in the second half [76] Question: Current view on the National hotel and Chula Vista project - Management expressed satisfaction with the renovation work at the National hotel and indicated no desire to invest in the Chula Vista project [90][103] Question: Wage and benefit cost increases - The company anticipates wage rate increases of 5% to 6% in 2023, with efforts to offset these through productivity gains [87] Question: Forward booking activity and macro concerns - Management noted that while there was initial caution due to tech sector layoffs, lead volumes have been promising, indicating a recovery in confidence among meeting planners [86] Question: Group bookings composition for 2023 - The company expects a higher proportion of corporate bookings compared to previous years, with positive trends in lead volumes [112] Question: Key drivers of the entertainment business - Management highlighted growth opportunities in both physical venues and digital distribution, aiming to create a stand-alone live entertainment and media business [145]