Market Overview

Sunstone Hotel Investors Reports Results For First Quarter 2019

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IRVINE, Calif., May 6, 2019 /PRNewswire/ -- Sunstone Hotel Investors, Inc. (the "Company" or "Sunstone") (NYSE:SHO), the owner of Long-Term Relevant Real Estate® in the hospitality sector, today announced results for the first quarter ended March 31, 2019.

First Quarter 2019 Operational Results (as compared to First Quarter 2018):

  • Net income decreased 53.4% to $17.9 million. Excluding the effect of the gain on the two hotels sold during the first quarter of 2018, net income would have decreased 21.4%.
  • Income attributable to common stockholders per diluted common share decreased 60.0% to $0.06. Excluding the effect of the gain on the two hotels sold during the first quarter of 2018, income attributable to common stockholders per diluted common share would have decreased 25.0%.
  • 21 Hotel Comparable Portfolio RevPAR increased 4.3% to $177.23.
  • 21 Hotel Comparable Portfolio Adjusted EBITDAre Margin, excluding prior year property tax adjustments, net increased 40 basis points to 26.3%.
  • Adjusted EBITDAre, excluding noncontrolling interest increased 3.3% to $64.5 million.
  • Adjusted FFO attributable to common stockholders per diluted share increased 5.0% to $0.21.

John Arabia, President and Chief Executive Officer, stated, "Comparable property-level Adjusted EBITDA increased an impressive 6.0% in the first quarter due to strength in both group and transient business, healthy out-of-room revenues growth, the continued benefit from our completed renovation projects, and an ongoing focus on operating efficiencies. First quarter Comparable Portfolio RevPAR came in near the high end of our previously provided guidance range and our Comparable Portfolio Adjusted EBITDA margins increased by a healthy 40 basis points, which combined, resulted in quarterly earnings materially above the high end of our previously provided guidance range. Our outlook for operating fundamentals for the remainder of the year has not changed; therefore, we have increased our full-year earnings guidance for 2019."


UNAUDITED SELECTED STATISTICAL AND FINANCIAL DATA

($ in millions, except RevPAR, ADR and per share amounts)











Three Months Ended March 31,



2019


2018


Change











Net Income

$

17.9


$

38.5


(53.4)

%

Income Attributable to Common Stockholders per Diluted Share

$

0.06


$

0.15


(60.0)

%










21 Hotel Comparable Portfolio RevPAR (1)

$

177.23


$

169.99


4.3

%










21 Hotel Comparable Portfolio Occupancy (1)


79.2

%


79.2

%

bps

21 Hotel Comparable Portfolio ADR (1)

$

223.78


$

214.63


4.3

%










21 Hotel Comparable Portfolio Adjusted EBITDAre Margin (1) (2)


26.3

%


25.9

%

40

bps










Adjusted EBITDAre, excluding noncontrolling interest

$

64.5


$

62.4


3.3

%

Adjusted FFO Attributable to Common Stockholders

$

47.5


$

45.9


3.5

%

Adjusted FFO Attributable to Common Stockholders per Diluted Share

$

0.21


$

0.20


5.0

%








(1)

The 21 Hotel Comparable Portfolio is comprised of all hotels owned by the Company as of March 31, 2019.

(2)

The 21 Hotel Comparable Portfolio Adjusted EBITDAre Margins exclude any prior year property tax adjustments, net.

Disclosures regarding the non-GAAP financial measures in this release are included on pages 5 through 7. Reconciliations of non-GAAP financial measures to the most comparable GAAP measure for each of the periods presented are included on pages 10 through 14 of this release.

The Company's actual results for the quarter ended March 31, 2019 compare to its guidance originally provided as follows:

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