Host Hotels & Resorts, Inc. (NYSE:HST) Q3 2019 Earnings Conference Call Transcript

Nov 06, 2019 • 10:00 am ET

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Host Hotels & Resorts, Inc. (NYSE:HST) Q3 2019 Earnings Conference Call Transcript

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Presentation
Operator
Operator

Good day and welcome to the Host Hotels & Resorts Incorporated Third Quarter 2019 Earnings Conference Call. [Operator Instructions]. At this time, it is now my pleasure to turn today's call over to Ms. Tejal Engman, Vice President. Please go ahead, ma'am.

Executive
Tejal Engman

Thanks, Carrie. Good morning everyone. Welcome to the Host Hotels & Resorts third quarter 2019 earnings call. Before we begin, I'd like to remind everyone that many of the comments made today are considered to be forward-looking statements under federal securities laws. As described in our filings with the SEC, these statements are subject to numerous risks and uncertainties that could cause future results to differ from those expressed and we are not obligated to publicly update or revise these forward-looking statements.

In addition, on today's call, we will discuss certain non-GAAP financial information, such as FFO, adjusted EBITDAre and comparable hotel results. You can find this information, together with reconciliations to the most directly comparable GAAP information, in today's earnings press release, in our 8-K filed with the SEC, and the supplemental financial information on our website at hosthotels.com.

This morning Jim Risoleo, our President and Chief Executive Officer, will provide an overview of our third quarter results and update on our capital allocation activities and our outlook for 2019. Michael Bluhm our Chief Financial Officer will then provide detailed commentary on our third quarter performance, our capital position and our guidance for 2019.

Following their remarks, we will be available to respond to your questions. And now, I'd like to turn the call over to Jim.

Executive
James F. Risoleo

Thank you, Tejal, and thanks everyone for joining us this morning. We remain focused on creating value for our shareholders on multiple fronts in the third quarter, which exceeded consensus expectations for adjusted EBITDAre and adjusted FFO per diluted share. We grew comparable hotel Total RevPAR by 120 basis points in the third quarter and delivered our strongest comparable total RevPAR and RevPAR performance year-to-date.

We continued to successfully execute our capital allocation strategy by completing $565 million of asset sales and repurchasing $200 million of stock during the third quarter and have sold an additional $297 million of assets subsequent to quarter end. We strengthened our balance sheet by refinancing $650 million of Series Z and B bonds, with the first green bond issuance in the lodging industry and achieved the lowest effective bond pricing in the company's history.

In addition, we increased the capacity of our revolving credit in term loan facility by $500 million to $2.5 billion. And finally, we made significant progress on our pipeline of ROI projects, which we expect will unlock embedded value at several of our iconic and irreplaceable assets.

I will now discuss our comparable revenue performance, revised 2019 operational outlook, capital allocation and our pipeline of ROI projects. Michael will detail our third quarter comparable EBITDA margin performance, recap our balance sheet improvements and provide the specifics on our updated 2019 guidance.

Beginning with our third quarter revenue performance, we drove comparable