Hyatt Hotels Corporation, for the second quarter, reported comparable systemwide hotels RevPAR increased 1.6%, driven by the company’s luxury chain scales, compared to the second quarter of 2024. Net rooms grew by 11.8%, and net rooms excluding acquisitions grew by 6.5%.
“The second quarter’s results reflect solid performance across our business, including strong fee contribution in a lower RevPAR growth environment,” said Mark S. Hoplamazian, president/CEO, Hyatt. “As we look ahead, we are encouraged by recent booking trends, leaving us optimistic about improving performance in the fourth quarter and into next year. We are confident in our ability to continue delivering strong financial results by leveraging our brand-led strategic approach and history of leading industry net room growth.”
He continued, “The Playa transactions, including the agreement to sell the entirety of Playa’s real estate portfolio, reinforce our commitment to our asset-light business model and solidifies our leadership in the fast-growing luxury all-inclusive segment. The acquisition and planned disposal of the Playa Real Estate Portfolio, at an attractive multiplication, allows us to create once again highly durable fees and a long-term value.
Highlights of the second quarter include:
- Hyatt Hotels Corporation’s net loss was $3 million, and its adjusted net income was $66.6 million
- Diluted EPS for the quarter was $0.68 and adjusted diluted earnings was $(0.03)
- Gross fees increased by 9.5% to $301 millions in the second half of 2024.
- After adjusting for assets that were sold in 2024, adjusted EBITDA increased by 9.0% to $303 million. This represents a 1.1% decrease compared to second quarter 2024.
- About 140,000 rooms are in the pipeline for management or franchising contracts, which is an increase of approximately 8 percent compared with the second quarter 2024.
Second Quarter Operational Commentary
RevPAR was up in the second-quarter for luxury chains, while RevPAR declined in select-service U.S. hotels compared with the second quarter in 2024. RevPAR was negatively affected by 60 basis points due to the timing Easter holiday, which was in the first half of last year.
Gross fees increased by 10% in the quarter compared to the same period last year. Bahia Principale and Standard International properties contributed approximately $11million, or 42%, of the overall gross fee growth.
The base management fee increased by 13% due to the growth in managed hotel RevPAR and the contribution from newly opened hotels.
The growth in incentive management fees was 15%. This is due to newly opened hotels, the performance of all-inclusive resorts, U.S. resorts, and favorable exchange rates for foreign currencies.
Franchise and other fees grew 4% due to non RevPAR fee contributions as well as newly-opened hotels.
After adjusting the EBITDA of the owned and leased segments for assets that were sold in 2024 as well as the impact of Playa Hotels, it increased by 1%. Comparable owned-and-leased margin fell by 170 basis points in the second quarter compared with the same period of 2024.
EBITDA adjusted for the distribution segment was flat compared with the second quarter in 2024. Higher pricing, cost-effective management, and favorable foreign exchange rate offset lower bookings.
Opens and Development
In the second quarter,
- The company opened 8,920 guest rooms, including approximately 2,600 associated with the Playa Hotels purchase. Notable openings included Hyatt Regency Zadar, Hyatt’s first property in Croatia; Dreams Rose Hall Resort & Spa; Zélia Halkidiki, a Destination by Hyatt hotel; and AluaSoul Sunny Beach.
- Unscripted By Hyatt is a new, upscale brand that unlocks growth by converting and reusing existing assets. This flexible approach allows owners to take advantage of our global distribution network and World of Hyatt loyalty programs.
Transactions
The following information has been provided on the Playa Hotels transaction and Playa Real estate acquisition:
- On June 17, the Playa Hotels purchase was completed for $2.6 billion.
- Announced the entry into a final agreement with Tortuga Resorts on June 30. The joint venture of an affiliate of KSL Capital Partners LLC and Rodina will sell the entire portfolio of real estate acquired in the Playa Hotels Acquisition for $2 billion. In conjunction with the expected sale before 2025, the company has entered into management contracts for 13 out of 15 resorts that will last 50 years.
- The company must use the proceeds of the Playa real-estate transaction to pay back the $1.7 billion delayed drawing term loan that was used to fund part of the Playa Hotels purchase.
Outlook for the full year 2025
The metrics below do not include any impact from the Playa Hotels purchase and the Playa Real Estate transaction that is pending.
- RevPAR is expected to grow between 1% – 3% in the hotels system, as compared to 2024.
- The growth of net rooms, excluding acquisitions, is expected to be between 6 and 7 percent for the year 2024.
- Projected net income is between $135 Million and $165 Million
- After adjusting for assets that were sold in 2024 and comparing it to the full year 2024, adjusted EBITDA will be between $1.085 billion to $1.130 billion. This represents an increase from 7% to 11%.
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