Ryman Hospitality Properties(US:RHP)2023-11-07 19:58Financial Data and Key Metrics Changes - The same-store hospitality portfolio delivered adjusted EBITDAre of $135.2 million in Q3 2023, a year-over-year decline of $1.5 million, with a 90 basis point decline in adjusted EBITDAre margin due to an increase in incentive management fee expenses [5][14]. - The company updated its full year guidance range for consolidated adjusted EBITDAre to $672 million to $700 million, reflecting an increase of $4.5 million at the midpoint [14]. - The net leverage ratio of total consolidated net debt to adjusted EBITDAre was 4.3x, below the end of 2019, with 80% of outstanding debt at fixed rates [15]. Business Line Data and Key Metrics Changes - The same-store hospitality portfolio saw total revenue up 20.7%, total ADR up 22.4%, and group ADR up 16.5% compared to Q3 2019 [2]. - The Entertainment segment delivered $82.3 million in revenue and $25.6 million in adjusted EBITDAre, up 6.7% and 21% respectively compared to Q3 2022 [34]. - Approximately 695,000 group room nights were booked in Q3 2023, a 13.2% increase from the comparable period in 2022, with an average rate of $268, up 1.2% from the prior record [11]. Market Data and Key Metrics Changes - The company reported a shift in group mix to a more normalized level of corporate group room nights and banquet spend, with attrition and cancellation fees increasing to $11.3 million, up $1.3 million from 2022 [32]. - Early ticket sales for the upcoming holiday season are pacing ahead of last year, indicating strong demand [86]. Company Strategy and Development Direction - The company is focusing on enhancing customer relationships and investing in assets to improve value propositions, which translates to stronger customer loyalty and shareholder returns [88]. - The company plans to continue its differentiated strategy by building long-term group customer relationships and improving service quality [29]. - The pivot in the media distribution strategy for Circle away from linear television to streaming and digital distribution is expected to increase audience reach [35][89]. Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about margin growth in 2024, despite pressures from rising real estate taxes and insurance costs [39][40]. - The company anticipates continued strong growth in group bookings, particularly in the corporate segment, which is expected to drive catering revenue [56]. - Management is encouraged by the performance of the JW Hill Country asset and is focusing on operational efficiencies and enhancing customer experiences [44][46]. Other Important Information - The company has approximately $543.1 million in unrestricted cash and total available liquidity of about $1.3 billion [36]. - The company plans to host an Investor Day in mid-January to discuss its strategy and growth priorities [9]. Q&A Session Summary Question: Can you share thoughts about margins for next year? - Management is hopeful for margin growth next year, estimating a need for a 3.6% increase in RevPAR to maintain flat EBITDA margins [39]. Question: What are the expectations for the upcoming holiday season? - Early indications show favorable ticket sales for the holiday season, with expectations of strong demand [71]. Question: Can you discuss the decision to wind down Circle entertainment? - The decision was made to pivot towards syndicating and licensing content to increase audience reach, given the pressures on linear TV [77][89].