Xenia Hotels (XHR) Misses Q2 EPS by 2c, Revenues Beat

Xenia Hotels (NYSE: XHR) reported Q2 EPS of $0.26, $0.02 worse than the analyst estimate of $0.28. Revenue for the quarter came in at $277.06 million versus the consensus estimate of $269.69 million.

Second Quarter 2018 Highlights

• Net Income: Net income attributable to common stockholders was $28.8 million and net income per diluted share was $0.26, a 58.5% and 60.0% decline, respectively, year over year due to a $49.2 million gain on sale of investment properties during the second quarter 2017.
• Same-Property RevPAR: Same-Property RevPAR increased 3.4% compared to the second quarter of 2017 to $177.99, as occupancy increased 190 basis points and ADR increased 1.0%.
• Same-Property Hotel EBITDA Margin: Same-Property Hotel EBITDA Margin was 33.5%, an increase of 32 basis points compared to the second quarter of 2017.
• Total Portfolio RevPAR: Total Portfolio RevPAR was $178.04, 8.5% higher than in the second quarter of 2017, reflecting portfolio performance and the change in portfolio composition.
• Adjusted EBITDAre: Adjusted EBITDAre increased $10.3 million to $89.8 million, an increase of 12.9% compared to the second quarter of 2017.
• Adjusted FFO per Diluted Share: Adjusted FFO per diluted share was $0.66, an increase of 11.9% compared to the second quarter of 2017.
• Financing Activity: The Company paid off four mortgage loans totaling $210 million and executed two swap transactions totaling $65 million.
• Capital Markets Activity: The Company issued $122.2 million of common stock under its At-The-Market program.
• Dividends: The Company declared its second quarter dividend of $0.275 per share to common stockholders of record on June 29, 2018.

"Our second quarter operating results met our expectations as strong April performance drove a 3.4% RevPAR increase for the quarter," commented Marcel Verbaas, Chairman and Chief Executive Officer of Xenia. "Top-line performance was particularly strong in Dallas, as healthy group business contributed to RevPAR growth of 14.1%, and San Francisco, where robust transient demand lead to a 10.6% RevPAR increase for the quarter. Additionally, we began to see the early benefit of our recent renovations at the Westin Galleria and Westin Oaks which, coupled with easier year-over-year comparisons, resulted in a 12.2% RevPAR increase at our Houston hotels. We were pleased with our margin growth of 32 basis points during the quarter, as total expenses increased by a modest 2.1%. As we look ahead, we remain cautiously optimistic about operating fundamentals and we look forward to reaping the full benefit of the seven guestroom renovations we completed in the first half of 2018. Although our on-going capital projects, which include guestroom renovations at Marriott Dallas City Center and Hyatt Regency Grand Cypress as well as meeting space renovations at our Houston hotels, are creating varying levels of disruption to operations in the third quarter, we believe the significant improvements we are making to our portfolio in 2018 will further enhance our competitive positioning as we look toward 2019 and beyond."

For earnings history and earnings-related data on Xenia Hotels (XHR) click here.

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