Hyatt Hotels Corp. posted better-than-expected results during the first quarter, reporting gains in average daily rate and occupancy, as well as a spike in net income from asset sales.
Systemwide ADR grew 2.7 percent year over year to $186.63, and occupancy rose 2.2 percentage points to 72.4 percent. At Hyatt's U.S. full-service hotels, transient room revenue increased 4.4 percent, driven by increases in rate and occupancy. Group room revenue, however, declined 1.4 percent. Hyatt president and CEO Mark Hoplamazian attributed the dip in group to the shift of the Easter holiday into the first quarter. He said that while association business declined, corporate group business held steady.
Looking ahead to the rest of the year, Hoplamazian expects gains in group revenue, as group bookings made during the first quarter for travel in future periods were stronger than expected. Hyatt revised its prior revenue per available room guidance for 2018, increasing expectations from the 1 to 3 percent range to the 2 to 3.5 percent range.
Net income increased from $55 million in the first quarter of 2017 to $411 million, in the first quarter of 2018, driven by the $992 million sale, to Host Hotels & Resorts, of the Andaz Maui at Wailea Resort, the Grand Hyatt San Francisco and the Hyatt Regency Coconut Point Resort and Spa. Those properties remain under long-term management agreements with Hyatt.
Questioned during the company's first-quarter earnings call about the potential for future brand acquisitions, Hoplamazian said Hyatt is actively looking at a number of opportunities but "it's really too early to say." The company added to its portfolio 1,896 rooms across nine properties during the first quarter. It's on track to add 60 properties during 2018.
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