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With that, let me turn the call over to Mr. Jay Shah, CEO.Jay H. Shah Thank you, Nikki, and good morning to everyone. I’m joined today by Neil Shah, our Chief Operating Officer, and Ashish Parikh, our Chief Financial Officer. On today’s call we will touch on some highlights from the second quarter, discuss our portfolio strategy and update you on our lodging markets and impact from the overseas and particularly, European travel as it impacts our portfolio. The second quarter portfolio result reflect the Company’s continued outperformance as Hersha delivered industry leading results as our consolidated and same-store portfolio generated RevPAR growth of 8.2% and 7.8% respectively. A particular note is our EBITDA margin. With our same-store hotels recording the highest quarterly EBITDA margins in our history at 43.9%. This performance is the direct result of our urban gateway portfolio, which is focused on the high rated trend in business traveler combined with effective yield management and our aggressive asset management programs. Additionally, with the young age of our portfolio, the significant capital that we’ve reinvested in our assets and the high occupancies in our markets, we expect a meaningful runway in our multi-year growth platform. Although we’re pleased to be harvesting the positive result of this strategic transformation, we’re even more pleased knowing that the inherent organic growth in the portfolio will be significantly bolstered in the coming quarters by over $350 million of newly developed or acquired assets, that will begin delivering EBITDA contributions later this year. We’ve assembled a portfolio of high quality hotels in key urban markets with a variety of robust demand drivers and our portfolio wide occupancy at 81% is indicative of the strength of the markets and our assets. In fact, seven of our top 10 properties by EBITDA contribution had occupancy of approximately 90% or higher during the second quarter. And 8 of those top 10 EBITDA producers had an average daily rate of greater than $200. And the one that didn’t is the Courtyard Miami, which is undergoing significant construction.
Another demand indicator regarding our concentration in urban gateway markets is international travel. Through the end of the first quarter, total overseas visitation to the U.S. was up 13.4% with Western European travel up almost 10.1%.Now let me turn specifically to New York City, vis-à-vis international travel. As a percentage of our total revenue in New York City year-to-date, international travelers on average account for approximately 18.5% of our room revenues, with roughly a quarter of that coming from Canada and the U.K. That means all other international guests comprise less than 14% of our business. Among the top 10 international revenue contributors to our New York City portfolio, European countries represent approximately 5% of our total room revenues, while the Eurozone countries represent only 3.1% of total room revenues. From another relevant perspective, a hypothetical decline of 20% of European business to our portfolio would translate to less than a 1% decline in total room revenues and that is assuming that we cannot replace the lost rooms in a portfolio that consistently runs over 90% occupancy. We had noticed a slowdown slightly in inbound Eurozone travel, but at the same time we’re seeing overall growth in international inbound travel suggesting that the strong growth in travel from Canada, Japan, Mexico, Brazil, China, Korea, and India seem to be displacing any loss experience from the Eurozone. Now let me give you a little color on each of our key markets. Our Manhattan Hotels were again among the top performers in our portfolio. RevPAR growth of 12.3% was driven by a 6.8% increase in ADR and a 4.5% increase in occupancy to 92.3%. Running occupancy at this level means our hotels were effectively sold out five nights a week. In comparison, Manhattan as per the Smith Travel Research data achieved a 7.3% RevPAR growth, with ADR growth of 5.2%. Read the rest of this transcript for free on seekingalpha.com