Only a few days into the second-quarter earnings season for hotels, both companies that have released performance metrics have downgraded their 2019 revenue per available room guidance. On Wednesday, it was Hilton. Yesterday, Wyndham Hotels & Resorts adjusted downward from a range of between 1 percent and 3 percent to a more definitive 1 percent "to reflect recent trends."
"The biggest issue has been in the U.S. That's where we're seeing softness," said CEO Geoff Ballotti. "The international regions have been performing well."
Despite the adjustment, Wyndham global RevPAR increased 5 percent year over year in constant currency for the quarter ending June 30 and increased 40 basis points in constant currency, excluding the company's acquisitions and divestitures. U.S. RevPAR grew 5 percent and increased 30 basis points, excluding 2018 acquisitions and divestitures. The extended-stay/lifestyle properties segment showed the highest growth, 13 percent.
"The 2017 hurricanes will no longer significantly impact our driver comparisons as we move into the third quarter," CFO David Wyshner said. "Excluding acquisitions, divestitures and the hurricane effect, our U.S. RevPAR growth was driven primarily by higher occupancy. We saw the strongest results in our Howard Johnson, Microtel, Hawthorn and Wyndham brands and in the mountain and mid-Atlantic regions."
Systemwide, rooms grew 3 percent year over year in the second quarter to nearly 817,000 across about 9,200 properties. About 7,500 new rooms were domestic; the La Quinta brand, acquired in January 2018, accounted for about 1,300 of those rooms. Internationally, Wyndham added 20,000 rooms; Southeast Asia was the fastest growing region, at 22 percent.
As of June 30, the company's pipeline consisted of 188,000 rooms, a 10 percent year-over-year increase. Approximately 55 percent of the company's development pipeline is international and 74 percent is new construction.
Net income rose 24 percent to $26 million compared to the second quarter of 2018.
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