Sunstone Hotel Investors (SHO) Reports Q1 Revenues Miss

Sunstone Hotel Investors (NYSE: SHO) reported Q1 EPS of ($0.75), $0.72 worse than the analyst estimate of ($0.03). Revenue for the quarter came in at $191.21 million versus the consensus estimate of $222.25 million.

John Arabia, President and Chief Executive Officer, stated, "In response to the unprecedented impact of COVID-19 on the lodging industry and our portfolio, we acted quickly to meet these significant challenges and position ourselves for the future. First, working with our hotel operators, and in consultation with various health authorities, we temporarily suspended operations at the majority of our hotels and significantly reduced operating expenses at those hotels that remain open and running at low occupancies. Second, we have postponed a large number of capital projects, while at the same time, we have accelerated a small number of operationally disruptive capital projects while the hotels have suspended operations. Third, we have paused both our share buyback activity and common stock distributions and put in place various cost-containment initiatives at our corporate headquarters. And finally, we are working with our top-tier bank group and note holders to not only provide us needed covenant relief, but also provide some flexibility to continue to manage our business with an eye on the future."

Mr. Arabia continued, "Our strong balance sheet and liquidity position provide us with a long runway to endure this unprecedented operating environment. After taking the difficult, but necessary, steps to protect the company and to maximize liquidity, we have turned our attention to the future. We are working with our operators to modify hotel operations to adapt to, and best compete in, a new environment and we continue to work with our group customers to rebook or sell new group meetings at most of our hotels. With our financial strength, significant expertise, and strong partnerships with our operators and capital providers, I am confident in our ability to weather this historic storm. I greatly look forward to reopening our hotels, getting the talented and hard-working hotel teams back to work and welcoming our guests to our hotels and resorts as soon as appropriate."

For earnings history and earnings-related data on Sunstone Hotel Investors (SHO) click here.

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