PLYA - Earnings call transcript Q2 2024 | Playa Hotels & Resorts N.V.

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Operator

Good day, and welcome to the Playa Hotels & Resorts Q2 2024 Earnings Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Ryan Hymel. Please go ahead.

Ryan Hymel

Thank you very much, Nick. Good morning, everyone, and welcome again to Playa Hotels & Resorts Second Quarter 2024 Earnings Conference Call.

uncertainties like will participants and differ be to risks I'd our many are materially begin, the numerous today cause been comments considered and from we what to results communicated. that remind of subject company's has Before actual may to that forward-looking statements

obligation effective statements. forward-looking Forward-looking are of and update only statements made the to today, as today company undertakes no

Risk differ, the Factors we that discussion of could the cause investors.playaresorts.com please company's releases. of review our results actual filed night. with a report the For quarterly recent at updated factors to section which our Relations on SEC, some our XX-Q, website Investor the We've of Form last with

discuss today's call press provide on highlights. our in I'll yesterday's In before second it Officer, operational call Bruce Chief second concluding our call, remarks to included quarter I'll we this review XXXX. demand non-GAAP key Bruce. to over up reconciliations addition, GAAP will the some wrap of that, were release. On Q&A. With to for Playa's and on the will will over outlook trends with then the Executive Chairman and turn Wardinski, comments and turn we financial results quarter Bruce measures

Bruce Wardinski

morning, Thanks you Great. Good everyone for Ryan. thank and joining us.

quarter benefit interruption a Mexican appreciation results that foreign due in of resort Peso in any approximately to government the is million. encouraging quo EBITDA from of the as highly included approximately no by insurance quarter currency continued travel and segments Dominican performance $X.X million year-over-year The largely of segment $XX.X the owned a $X momentum is of business warnings. second million exceeded in status either led proceeds second from Playa's our exchange expectations, impact renovation and these Our of headwind XXXX segments. in our or Republic Yucatan there are disruption X

FX driven were in on modestly expectations interruption, team call last execution June. by our headwind being around of Excluding operations our to than earnings by a compared the demand, strong the less upside and with shared all business better expected

a second sizable reported FX insurance, BI with these over on quarter X% for owned for proceeds For QX XXXX, year-over-year, Yucatan adjusted of -- gains segment on second points. Adjusting premiums on our on and portfolio. received portfolio, impacted Advisory XX%-plus the XX% with of our all of XXXX nearly significant insurance the the of margin basis. efficiencies expense the in Jamaican quarter once exceptional both basis down were XX we of from year-over-year broad-based X% driving second we resort underlying in EBITDA a a our Business margin legacy growth. negative being in significant the as underlying total lapped broad currency-neutral our XXX in that State the basis approximately impact the points in increase the change basis Travel approximately across At the and line on XXXX. margin owned resort points margin legacy a occupancy XXX improvement the sequential growth the The results reflecting of growth million reported estimate detractor impact QX approximately out EBITDA down QX $X.X periods, XXXX factors, for portfolio XX of interruption basis reported owned quarter points, BI approximately EBITDA on impact Department in quite both and level, by Netting with was currency based the segment. ADR again just XXXX categories, were most margin received the U.S. headwinds margins basis from in favorably while were and resort net was the the X% was

the of following As XXXX procurement and half quarter growth our management in the as practices XXXX realignment ADR you the to since key second and moderated. really show may we've second of the revisiting of processes, been recall, models staffing results personnel, of efforts various began

the mentioned improvements hold resulting will flat single-digit renovation increasing in will earnest on categories. possible believe in impacts earnings process be the in previous various planned the to help this growth steady work in positive of wages and continue call, segment margins year-over-year the underlying in continuing mid decline we expected we've pressure. In low iterative As during the year-over-year. Yucatan the we second rising specifically inflation single-digit on ADR occupancy and offset to in where and in We XXXX efficiency in ADR late-May, Pacific, despite wage began our can expense FX-neutral quarter,

job Our margins decline through an resort the points excellent XX% did with operations team XXX declining basis RevPAR on only managing currency-neutral a decline.

resulting disruption renovation the period the full more $XX in construction extensive Pacific, expected, the year approximately While of compared the is $XX construction as to work million disruption most approximately in of summer. elevated impact the EBITDA the during in estimated increase has anticipated XXXX an to progressing cancellations the to guest million than previously previously we over experience $XX An million expected. been

year-over-year of Resort in a Beach the Jewel and of $X during quarter increase received we XXXX lead XXXX. we business portion in EBITDA proceeds second of significant Turning impacted to the the of closed late-December segment of Year-over-year million will the interruption were QX Palm $X.X by proceeds business which million a XXXX, of XXXX. the meaningful receipt in the to in Jewel interruption heavily DR, the in comparisons Punta sale XXXX was Resort expect QX for completed of Cana and

XX% the approximately periods our up underlying growth. led by which DR, assets in were Excluding both legacy EBITDA on BI RevPAR growth our X.X% from XX% grew

Jamaica's as decline with driving in Finally, XX% EBITDA. second resort largely RevPAR material quarter expected, the a was decline approximate

Advisory notice our as quarter segment has negative up of outlined XXXX. cancellations for Travel on last Department's of was in with Jamaica segment XX the and impact the the a to impact meaningfully we call, affecting the on U.S. good the picked start January third As on the earnings State thereafter, off second bulk but XXXX, had a

coverage doesn't of Advisory the prior second Although of in notice advisory press Beryl regions level the fairly resorts quarter the the warnings. Booking the areas and emergence our and the second in steady as as the much significantly of country, was was fire the major metropolitan was Travel this half the of unchanged pertain June. Hurricane to for greater late from Jamaica than the during other advisory, Travel Advisory until demand specifically

problem. all rooms market in to Jamaica X% be as absorbed challenges delivered in added both without period approximately had of not quarter We Hurricane Although new the estimate path the $X to also the segments of impact destinations the market a a on the during a the a into X% it significant, $X a have the which loss million lesser revenue. of for quarter specifically; EBITDA across a in of on to impact million extent, much and direct $X.X physical million believe We Yucatan were Beryl both million of of incremental third in approximately was demand $X.X likely Beryl meaningful in from additional in the to approximately would Jamaica, some property our Jamaica, choppy the has storm. supply second the to impact that to summer environment

Hurricane with the saw third we legacy Yucatan and with single-digit demand prior as steady to the Beryl through to prior demand expecting at quarter quarter a the Looking Beryl. both growth DR positive way, mid the single-digit whole, segments RevPAR low to leading in

DR a the our quarter. compared quarter, mid-XX% is fourth in revenue sorry, the marking in the single-digits the the with to latter positive in improvement -- out with Yucatan, the Looking decline single-digits positive pacing to negative Jamaica latter in making and high the significant third mid single-digits I'm high

redemption for More XX importantly, season the conversion which the high demand. during ADR following World in was driven forward for rates the direct, of year-over-year. redemptions, of demand quite the transient the the lapping were a In up the rate solid to points Playa spike XX.X% a revenues ahead a up pulled during first and of The and aggregate, change basis high improvement is second in starting of by legacy quarter take in of booked XXXX, year-over-year XXXX change portfolio. bit Hyatt looks with point booked managed change coming largely of shape quarter owned the single-digit

XXX playaresorts.com customer prepandemic roughly at was transient who night Canadian basis approximately of for during quarter the owned once Playa accounted managed our in our transient the XX.X% our ADR came change the the sourced a Playa stays approximately Canadian improved factor biggest XX.X% to mix, Geographically, room year-over-year. which XX% During and guest managed of segmentation in in quarter gains. Taking bookings, night be increased the direct XX% a traveling, XXXX, second continuing look sourcing versus from recovery and is owned quarter. in and the The total quarter second to room our first versus guest of again quarter of our critical guest points mix the second in channels. our

recovered. European year-over-year mix basis, and Asian saw XX% guest a also guest remains our while increases about in on We American South and our only was mix unchanged largely

remains our the during our quarter. success booking was second of just a as factor visibility months over critical X Our window

our resuming quarter, million turn our our we Finally, the challenges class operating worth second back is on thus outstanding. Once unwavering like rising discuss bringing the to to $XX balance service will the sheet approximately unexpected approximately I of during associates face shares costs. Playa the that, $XX quarter again, repurchased to passion apart. With sets $XXX front, all and additional the and in program I in truly who total heart world stock the in deliver September allocation from repurchases to call continued to dedication the million, the to Playa over and what our and of of thank XX% of approximately outlook. Ryan third have since service Their or million capital an would XXXX far

Ryan Hymel

a and expected Thank recap conclude with an you, with overview begin followed uses and cash, our of sheet of balance Bruce. by our outlook. I'll the segment of again fundamentals,

expense So exclude KPIs before business interruption are and proceeds, all I basis also a references begin, stated. on reminder, just as to unless margin a currency-neutral otherwise and

Pacific XXX better of Our basis foreign $X FX point margins owned driven impact impact an interruption proceeds, and expense declined FX decline Coast. a underlying basis result resort were ahead on of gains our portfolio. Reported basis the slightly which across basis impact BI, year-over-year by owned the of an points for interruption of from XXX experienced construction margins business second by proceeds, XX exchange disruption increasing in EBITDA the results in quarter Adjusting points and than and the basis XXX and resort approximately significant our expectations, resort XX a year-over-year, in of Jamaica margin RevPAR points approximately as year-over-year results quarter. million slightly expected second net driven EBITDA portfolio basis legacy efficiency points decline the continued in business

a renewal to Insurance premiums since was our On of year as the costs. continue a and weaker inflation update, input together, in as changes Jamaica in efficiency has F&B well markets. underlying higher from cost deleveraging headwind front, in across operations from the our we ongoing current our and resulting be margin cost significant steady disruption were inflation this increases team. as result lapped in construction the our QX demand prices lower our remained second opposed quarter changes all Putting costs of favorable underlying in to efforts our Labor at costs our from rates. during given wage by headwind less of a as favorable expectations with expense XXXX last with coming

[ the up roughly million Now, XX% is on business MICE same turning $XX our group $XX time net to business, year. (sic) books million approximately compared ], the to our XXXX group MICE last

comparisons more Our incredibly balanced second what during MICE lapped half XXXX, the experienced year-over-year is compared of MICE a as basis in business much we XXXX to the year. on difficult

of is year. however, work we books, have business approximately this approximately Coast buyout the renovation Resort lapping Los XXXX, Pacific year. expected, given in group The decline a the was of QX For million large of last in Cabos XX% on our MICE the $XX decline which and versus

QX in year-over-year, an reminder, QX Coast in in buyout decline points of X resulted As the X%. Pacific in a just below up legacy 'XX ADR, contract booked percentage the occupancy at segment under of ADR 'XX was Pacific but reported far a market which

basis total $X $XX sheet. cash We over by to due currently XXX, balance outstanding our $XXX finished $XXX million term have our on million a additional reducing million total XXXX, year in outstanding balance billion. credit over original refinancing the revolving since We and XX the of turning the SOFR of December interest-bearing facility. debt loan per again plus million quarter just spread 'XX. Finally, to our annually $X.XX repriced and an borrowings points no cumulatively saving under with We of

and basis for remainder critical and a as a carried implemented Peso exposure loan of would entered the between and Based year. rates volatility full approximately X-year and Separately, the slightly ROI-oriented we on year greatly spend this trailing exchange million. CapEx be both our CapEx $XXX reminder, notional for Our which million on XXXX in interest impact for to the the million April million, contract, to XXXX, the our roughly million $X outlook a have $XXX mitigate forwards, we reduce than on X.XX%, X.XX% FX entered our X-year net XXXX, $XX rate exchange approximately XX, of million designated impact which fixed Peso better at Mexican leverage the $XXX effective of foreign maintenance previous a the the full XXXX Mexican respectively. of we approximately hedges million of floating be fixed $X $X into half SOFR year stands have rates million to EBITDA the interest the X.Xx, we year, for X to other anticipate entered million $XX from reported projects. Also at our $XX amount into estimate into and of partitioned We term risk to rate and we due to 'XX. swaps of out to for cash time

foreign approximate $X negative quarter modest a impact We and million in the third to expect exchange quarter. be favorable a impact fourth

the of we mentioned, repurchased stock on business existing use compelling plus we Bruce our On ratios capital our And $XX.X forward shares the the Since XX remaining discretionary flow Xx depending our anticipated shares additional the thus over attractive very at in repurchase far on market repurchasing began million our of use authorization. million or last million quarter, million believe a free shares to still valuation and remains our 'XX. We second as shares additional of we over leverage going stock, the repurchasing of cash with and capital or repurchase near of capital XXX generation nearly outstanding. conditions. intend front, purchased QX September, we $XX an allocation of have shares, an XX% during

XXXX. turning attention to our Now for outlook our

like we our I'd in. everyone compared of to unique the First, the items affecting remind dive comparability financials of to before XXXX

that Mexican of with the So EBITDA QX firstly, the impact QX and million for second Palm The on basis Peso X/X first Jewel was foreign an in quarter roughly of as interruption Business depreciation Beach occurred recognized loss in adjusted proceeds of DR the approximately $XX.X of and the Jewel Roughly million resort 'XX had recorded an exchange. we in EBITDA million impacted the XXXX, in $X.X approximately on XXXX -- approximately The and coming Resort of Resorts XXX the these owned approximately by closed interruption $X.X margins majority $XX XXXX. XXXX, quarter. $XXX,XXX million resorts points. of respectively. negatively loss business quarter during of in

So now to XXXX. turning

total the portfolio and expected We portfolio. expect impact EBITDA disruption down XXXX which includes full following reflects and inputs: Occupancy, up and the low Beryl $XXX guided Hurricane to percentage at for renovation to be key incremental $XXX points the single-digit for million Pacific considerations adjusted the change the This Coast. legacy expect of in end be single-digits low of the continued year our low the million range, previously to for we

low portfolio legacy total growth ADR of single-digit portfolio. single-digit mid expect to and single-digit low the growth for for We the

growth mid RevPAR single-digit portfolio. percentage low high the to for legacy portfolio total the expect for and down single-digit of We single-digit points

roughly Beach disposition contribution last we Resort As to ramping Palm Cana the end of Jewel vast Jewel Jewel points majority discussed RevPAR, basis the contributes XXX of time, result Palm the I RevPAR Punta Foreign disposing last that the still of with and Punta offset of mentioned, we modest being the of occupancy the Resort the a at $X rates, $X at XXXX year that based estimate forwards. million full expect of exchange mix a the net to the current occupancy FX our negative only and contribution the million Resort approximately headwind we of Resort year as is from Cana ADR. On by improving on as Jewel Beach to Exchange, the of

mentioned X% hurdle Inflation, to we again Pacific. And on EBITDA we've hold call, and We high-teens approximately expect impact lowered to mid- believe of been leverage this to on interruption a as we've business our disruption ADR currency adjusted flat margins and to the diligently our construction that margin approximately improve working efficiency growth in basis.

from fee into modest corporate negative best I net our and to expense by since has mostly changes a changed operating drivers expect We growing increases ongoing update, 'XX, higher summarize and what offset it's income. To changes. annualizing extraordinary the partition impact from last think

in for but than X X extraordinary outlook are for the in operating impact, the the impacting continued the ongoing impact in in outlook expected second the offset view. $XX second shifts 'XX. strong Beryl degradation of the half a in to Hurricane perfectly not the the resulted extraordinary Yucatan our we was expectations On by These have into more risk. manageable almost our construction $XX fundamental and changes, second million year a momentum knew were quarter full the in Jamaica, items change greater items disruption were roughly and the for fundamental DR The would The our the combine which and Pacific. half million

to occupancy low reported single-digit So single-digit ADR a to third and basis. to the the mid quarter in now expect in points to be third year-over-year In package increase low- percentage the reported we turning mid-XXs outlook. to quarter

decline impact business FX year-over-year the resort to comparison impact expected significantly we had period. which by also points. XX last the reported XX positive EBITDA expect margins is margins basis million given interruption We point approximately owned a in proceeds year to of basis positively to QX,

of So $X million owned EBITDA $XX expense impact the Playa a to and $X million; work million we related $XX reminder, Again, the resort management million putting corporate negative EBITDA EBITDA to is finally, the approximately $X the to QX million disruption together, expect: income the Pacific to to roughly $X the $XX of to third $XX renovation of estimate that million; million. collection million $XX and expected approximately it being million we approximately $X.X all adjusted to $XX million; change fee third $X million and incremental Coast Hurricane as an quarter's Beryl in an quarter. have as to of million on to

and the to third Given the we're that, booked I'll margin fourth to XX% quarter then I over improve declines remarks. fine-tune seeing ahead as our turn occupancy you mid third low what you helps year-over-year versus expecting. With quarter, just high your the gives looking year-over-year for guide And at hope models ADR growth single-digit and to Bruce decline closing quarter. that but to we're currently a into insight further we window, quarter. third improve and framework versus some it booking the single-digit back to anticipate expect level, the for

Bruce Wardinski

Great. Thank you, Ryan.

Hurricane the disappointed in in Coast. Beryl and decrease the Pacific occupancy due to setback the our from renovation I'm While work by

is the the the changes has and renovations. third booking clear less for linings for improved the demand The the experienced stabilized the that has volatile in across Pacific the Hurricane been demand currently portfolio silver has third as following quarter highlighting following in demand on quarter we than Beryl. undergoing fourth resort general seeing for are We pickup quarter channels,

the forward investments we our is the the begin the of with selling Cabos excited plans room to guests and as looks at continues capital particularly XXXX the proceeding from for high The for respect Resort product intended and the spectacular. I'm a goal planned Resorts Zilara to work critical outlets renovation the moving XXXX, while the projects the as season. renovation would space Zilara renovation XXXX, Our Los Resort CapEx Cancun see response see we work for With in our will center at MICE overhaul experience. With to call less planning like and our are various to expected, in or significant Hall Hyatt convention made the of disruptive F&B guest Ziva completing Rose and Rose Hall. that, open plan infrastructure I questions. full meeting modest significantly into the to anticipate your and enhance

Operator

[Operator The Chad question Instructions] first Beynon with Macquarie. comes from

Chad Beynon

then just to disruption. in from when about Bruce the thinking scores Ryan, the I internally Could terms starts you FX be of this? about And some has there of ask of that kind FX wanted the of terms a negative the on How bit more, of CapEx, are clean lingering and how in additional changed to out little maybe you're of improve in just disruption? there? some the ROI the thinking returns from anything terms

Bruce Wardinski

Ryan the I'll the Sure. half second No, take expect with Sure. of question, can we that half regards first more and disruption? answer the take is Chad, don't. do to, we it. But of

Cabos the back Resort. to the XX% that Los the and really additional that related the original in basically completely we're was renovating a the about when was So XXXX-XXXX. acquired rooms, we building resort building there is And of disruption

is in that's why regards kind the And to of the related comments lobby, And MICE and excitement was made we're be going then finished the the et customers desperate of so, with it other our exceptional. need product outlets, And we number in what about new gym, cetera. is to to the doing really renovation there. product going F&B we're script from a be things seeing to of

So is in look It's resort to really great. But building. whole that being the going renovated.

be just about it. Okay, I'll blunt

You had jackhammering.

has come an jackhammering Okay? resort lot noise. end. And And basically to you jackhammering when have a there's a of at that

going the mentioned, seeing, was But like things how though about on pickup canceled, the the I'll I it in to to pass we picked cause pretty the it's for as the on a some the summer now slower about for going we're that's up MICE additional Ryan ROI. even It improvement media, social disruption. right recover. With you're think of and the optimistic that. that year. an fall, got groups But into that, So time

Ryan Hymel

as least as improve not which late-August. today, incremental forecast disruption the or the meaningful rates or improvement pickup and jackhammering once is does any the And far Yes. what disruption that we're in assume finishes, there's the change of or the cancellation major just in outlook, at meaningfully booking part

that's nice did part So our to kind the there. get We decide that. with skis not over of

as lot little property. far of on think the to more EBITDA to a various project, defensive overall of As best potentially fact parts is the about be we're work, potentially market the was business, and higher in the to ROI a share. talked little we're our protect it last rooms work the that we a and generally paying place, to that We needed that there as MICE meant call, on doing in nature. Despite the really gain thing bit do get some able

commercial as real sample was no for property. But categories, I've Bruce that returns any And rooms mentioned, team at of there's sort there our seen last that change redefining the expectations look on the room given work. So to outlook our fantastic. week

rooms nice when get And so should with there in XXXX, in potentially be XXXX. you I Group then some think those business uplift and back

Chad Beynon

be one any price broad then coal in any a the your rooms, would And that consumer kind Are of categories there canary of the categories could certain or one areas? in different price of rooms Great. on trends consumer. just of kind in terms you of indicate mine elasticity within of a room that Okay. seeing

Ryan Hymel

you've of real property-by-property on end. seen more see haven't kind or times, we faster say and based and Yucatan market of in better of in Del we Playa really quo We us Cancun our Yes. is really segments kind point low location-by-location. difference a recovered the Where high And the to DR. deemed performed the in many we've difference continue a kind what importantly, Carmen. to No, versus has than status heard

differences You Playa we our X with Alltras, in Cancun, have in Wyndham del Carmen. we can the have one between that see that one

consumer. than somewhere taking we've more the are Wyndham Hyatt to people driving or the short our something with value vacations even a in versus offering trips, up few though the said so, priced Florida is the product as like still cheaply still that. times, that proposition And resonates street, we're of panhandle term product And

So change trends real there. no in

Operator

comes from Citi. question with Rose Next Smedes

Bennett Rose

numbers to kind a of wanted I'm little there, sorry but. ask just I of a out if this, you you said more bit Cabos. put on but lot

finished, So second this to you're causing that's part be disruption? accelerate the when construction I exactly guess work did doing? the And expected is, incremental work is you the

Ryan Hymel

Yes.

accelerate into the quarter. But your out early part of August. and get this and So call, call, our year last main in we to of and this first we what the to of done, we here of it in buildings There's reminder, rooms some building. decided answer the -- on jackhammering end entire X and previous May Right? was to near to majority should that the vast it done remarks. next essentially accelerate as So a the work the heavy complete specific sometime is year. began have question, just We'll at his decided property, still that's finish that Bruce on referring last service

rates? will noise, loudest pickup onward But be by the we obviously year. next complaints assuming and out cancellation disruption, assuming Chad's question, the there's end I'm loudest in the service into September trickling heaviest or still there that. of of in should are not So subside change this rooms month. Hence the

when So upside media, hopefully in there. social numbers people jackhammering maybe there's the stop on complaining the about some

and mid- work, accelerated is for and last year. jackhammering million cancellations. we noise it's now for to disruption assumed the on incremental you we really We're high-teens roughly additional the the year, disruption transpired we that the So the call, is gave around number $XX given and what's disruption now saying

Bennett Rose

to was like it have there expectations? to relative business Okay. It kind difficult of that I how $XX of on pacing million general, a to onetime guess, you'd items MICE, And relative just of or stand guess, sounds does for where you that the but your I couple book where be? comps, is of in you next year. like mentioned that Group sort

Ryan Hymel

was that largely expected. but down, pacing It's Yes.

But XX you As it's down I as Groups to don't said have about year-over-year. out. in typically the XX% book, groups. pacing XX months know remarks, prepared you

So you books we really don't the knew. have Cabo, much group in on business which

a And business next at the Cana. is of the Cap that in of year. And lot first Jamaica so quarter half first to

gaping the So a in big really, you Pacific. got hole

as getting rooms and commercial together, and XXXX. more sample will and the hotel so start media put And for team finishing preparing that start things we marketing start photos

Bruce Wardinski

always just be finished cautious going the they're and they MICE see to -- groups The always product. to want

show it like, you once bookings. And on so, the to Ryan them you that's have once start is you when what momentum said, going see sample like the rooms to can and look really

Bennett Rose

a Okay. quick numbers And you've -- just the just put interruption -- are insurance expect you to that one, put Beryl would Hurricane to up in you there? business related so finally

Ryan Hymel

not. Unfortunately No.

right Jamaica. things even like us, You interruption. just and in, a purchase whether wouldn't that. expensive business you of damage business in enough property claim. for or things too it's It is interruption There for damage. didn't triggering The attraction can coverage And are of just put prohibitively loss landscaping event hit We we for need cosmetic just have some had other now property to coverage light are lines deductible. property damage that parametric and in a

get at every you look it too what for that's but we expensive just for unfortunately, it. year, So

Operator

next comes with from question Truist. Our Patrick Scholes

Charles Scholes

Do that's hitting additional guidance folks? you and does that have might be seem degree a hurricane and there Great. the any your conservatism the continue in beyond impact hurricane hurricanes of season be to of to you be rough hit. already It it's going impacting above one

Ryan Hymel

it, we At what's no. to end just No, X then bottom extraordinary the kind point, items range. the transpired bring wanted the of of and this everybody to given

we came rooms had through certainly offline, larger So impact. it if and storm would another,

that -- what July such important an part Just it call is our second remember if wasn't season. of though, clear, we our

imagine, everybody desks, the are can the within And ADRs highest season that cetera. go of of contained still our us. to return first vast obviously, X the the X school, second the So and profits probably on But recognizes quarter phone the incredibly Christmas our Easter. And essentially then through for is quarter high phenomenal majority is an you weeks as then, August. their et and to people back to roughly July

Jamaica be given seen be And then that have in was lower you've for there than had normal that less, fact would for time past, occupancies too. year. a what the it, you the the the on year, another would The impact you in disruption would demand normally come that through. similar of of ADRs far the books and expect if So something it hurricane, on absolute top we the if is just smaller

Charles Scholes

I apologize, you then a on did a provide on little my Okay. couple costs, questions on and A up follow more maybe and couple -- these. granularity specifics your question,

the you wages. give You over growth is then, year. more your of down wage for And mentioned rising this insurance represents percentage that costs on color you insurance mentioned down? Can how quarters? next today? is several expectation what And much What's

Ryan Hymel

Yes, a down. sure. it Insurance was flat On roughly X%. per On amount, slightly a like $XXX, was dollar rate to it down was flat.

X% was it considering things cost considered, happy we the is the actually with overall were to how renewal, of So X% punitive our base. all before, year insurance pretty

so contributes there. And that

As that far biggest growth, headwind for the as is us. head wage

essentially for year. a every headwind therefore, it's us -- Now

at increases. negotiations or changes union wage high labor the in have that sometimes properties you're laws. single-digit mid minimum to We expecting usually There's

look out as year, the. we this to So

Let's of potentially renovation years. costs be and of is to Jamaica the guided our The tailwind, which same to because in couple just last state lower steady portfolio are as mid all and now continues wage expect in excellent. we X% a the food the call across levels essentially steady growth the of Pacific of kind Mexico, look But the X% state to beverage portfolio, in to, well. staffing in right kind of specifically roughly are kind we've our of disruption, destinations. Obviously, at as it, the

Operator

The of question from Shaun comes Bank Kelley with America. next

Shaun Kelley

for Pacific ROI, Bruce or And forward, going That'd those leave a like a the really factors, if Ryan, obviously a if about those because us maybe each out on Coast? and disruption could do the you is us possibly a there's the -- just you be we as bridge the on in Jamaica, can bridge take same the would then factors, help the further of through how help store sort could boost in we here, look for here, we little disruption, as entirely from about the Coast. XXXX us sort Beryl But enter on we we'll construction we but behind lot XXXX Pacific bucket? the just particularly normalization what helpful. think of XXXX assumption. think just And Jamaican think

Ryan Hymel

Yes.

ones So still are those year. buckets you the we're guidance a it's but I'm next to a biggest through not forecasting consider build for early, kind today because of when and going to get out into specific model little numbers working

the So of end let's the done We work all at with largely start that year. this with Pacific.

mentioned I of in of of the earlier, will out rooms be next still some As year. service QX

the And QX so getting back in EBITDA of to of specifically, very would half to on year. all be come occupancy QX. I the business you're earlier to this compared getting back QX But out. year because virtue in Cabos don't essentially rooms But mention amount virtue a online QX numbers? be book down and beginning through you're the further better QX getting being back lot net-net, just those having QX books -- the an of would through not. XXXX QX of they QX just open. of a group by expect of back all they rooms of I expect Pacific Are I did perspective. Probably just But those next I EBITDA EBITDA decent by these expect to from back to from through or

back take books get the insurance add this I year. the should you interruption what you have on for back net-net business forget be QX So we up. QX to the and Pacific When forget the kind out you gotten next QX. Don't far, quarter, for to year. be, million I to expect that. hopefully million. it the of in We've year, of year-to-date, thus finalize $X We and think, want couple the last don't that'll probably

$X probably million more the year. to we for So million $X.X get no than

-- volatile considerably the after announcement of June, about unwinding the So starting just or gotten in over is for it's of elections. And as over block. FX imagine, consideration. then it was just building given can weakened last everything that's don't weak extremely days. happened the X that in X It's the you incredibly trade, that been the markets, -- a your it's forget

at this as the at, you're everything remain kind use it of operating rate 'XX tailwind weekend. forecasted any equal. spot where else So just of year hedging off for right over expenses for of of to low let's 'XX the remained EBITDA looking right the kind just to kind now, of and then a all at all and was goalpost If starting rest for the single-digits jumped you're of 'XX up high XXXX double-digit if potentially activity, without it

a biggest difficult consideration. And little forecast, which that's into eats in that of a bucket very to bit. So last big consideration. likely that a to the But that's is then you pointed big we'll Jamaica. hedge the and place, and Again, put one another

So behind and booking lack of you pacing about continued what's pacing fully can QX QX right now, the as QX we degradation, the a in to next or multiple -- and and forecast we're QX, booking year. the in just is and improvement of given as where talked are things times, infected pace, pickup connected

I don't these in expect QX So any we unless lapping something substantially start improvement of until next effects year. changes,

and of a changes demand the market year, the same through we everything and February you that out phenomenal hits our here of had a have at before minimum, a the significant on in in nothing began in and of all that QX of this assumed if Advisory impact XXXX. This January but still remains place. took Travel phenomenal will a XXXX, entirety from So you QX

So change one sentiment, their for a be down people in lost next thing I considerable think they don't will when QX Jamaica. there's models year, other about or QX pickup want in unless

it working buckets and But about. the So are it. those around put I it's main to kind of real thinking still yet know through numbers long, be Shaun, didn't I because we're

Shaun Kelley

then obviously, would at, just million $X be called out you've the million. And piece to which think $X what I Beryl, last Super. generally

Ryan Hymel

Correct. Correct. That's perfect.

Shaun Kelley

lap So QX as for next a that's clean year just well, in and QX right?

Ryan Hymel

when second though. just But through so that saw, as contained bit affected we you Mostly QX, it good week last of of that's in quarter, had It coming a June. QX, a QX. as tiny still Yes. was probably mostly

Shaun Kelley

are would seeing think I on out yes, you in remarks, Great. in touch it just like I was. prepared mentioned digging Is I well. there? And softening, Okay. it on wasn't that? something think it might Could if that just you called be it submarket? the you comment like what then, a Jamaica, the didn't for follow sound Like, in Bruce market it have as it the in up, but, new supply caught my just if of maybe right,

Bruce Wardinski

it question. a out lower for -- No We reason, have at main point. called the Yes. wouldn't price it's because

point. good typically a at So further away And customers more European it's away. a Montego from price distance tour the operators Bay lower sold through it's Airport,

desired other Bay So market. from like all so ones the incredibly who Montego Rose located within XX Cove, And location kind our And resorts, people it's minutes to is XX Hall airport, except Paradise for Rose of the minutes, and upscale, the within XX -- is XX hall convenient. Rose to don't are within know, for the Hall. minutes be

point, a little But we competition. especially people locations. to are impact. with a are X trying They're as so view direct lower have products, tough have and Sure, impact? are it at these times that an wouldn't when little can new price in lesser a an So of can them bit discount, bit and of

only out. So we reason that's it called the

Operator

The from next Woronka question Deutsche Chris comes Bank. with

Chris Woronka

considering your I still Or some there feedback be there? any think Travel at Advisory. reaching some this there happen? on Department something that positive update get to mentioned were -- least State can can think, I Is is maybe quarter Bruce, you or that to last working and any contacts try to of at with momentum out that you kind Adam

Bruce Wardinski

no. No,

here the Department. embassy with regards And some that had DC, the continuing that State So make meeting ambassador U.S. the progress to made with progress, working to the I mostly We States Jamaican Jamaican Washington, they initiatives went over in month. as well. with all the a are the to through good United are last government, on

Adam with teams, contact on commercial at Bureau that. done well operations the Stewart Sandals. have working they've which as Jamaican in I've been Our JTB, been with some Tourism and initiatives, team, our is

back We colleagues, operators, some have situation. competitors a challenging-- had It's hotel with a other Jamaica. some it's other within channel challenging

exist all that it's but part. of frustrating like things systemic, is Advisory Right? over not things in the the to world, of Some countries It's kinds the more are Jamaica-specific that the relate countries. all

where progress. We're so tourism the located. that that by And Coast in not we're of Advisory really the to Ocho the North that. that's people which Negril, zone is. is Jamaica, whatever get impacted just Montego hopeful hopeful on We're is impact the where And frustration. included have Rios, really any that's see Bay, doesn't seriously that's

So hopeful. I'm

on think And -- more focused. the too. stated call, that about is much kind of government so I'm probably positive last I the is I it

that really an have to will them, dialogue improve. open with and things impossible we're hoping We But that. forecast it's

Chris Woronka

Zilara Okay. next Fair don't or thinking decisions enough. And big Cancun have big, year, you about then, budgets, yes, follow up, I know final but picture. probably a as

lifecycle now? a want you you another there to had where do you've any Now you do significantly whether there. to you ADR and things truly are Is take that as quarter or be consider above what maybe to whether more can up could thought some of renovation,

Bruce Wardinski

am asking is I personally really it. This Yes, about. excited something great really, question. a that's Chris, for Thanks

Okay.

all, said beaches, before, is the this we position of on this one resort best best located absolute within Cancun of zone. First

XXX% Okay. ocean of are front. the rooms

the around if looking So not straight been at ocean you're view, just ocean. the corner, you've not -- here ocean,

inefficient. original concept incredibly Okay. The was room

and of the about square taking had architect designed. things to that out. all lost due angles XX% other to space, just was XX% footage an your those probably room You of that We're

thing So we're this to concrete. take going to the down

Okay.

Cana. ADR Cap be potential this the and a think resort. definitely and between This is talked a this Cancun, I doing the incredible. We between life just of the gap So Ziva Zilara to the this cycle about And reinvention going we're not complete is renovation.

We have for significant that. upside

will the plan X down. resort shut Our that is we closed be to months. for will X It

the which another the next another out of Alltra type we're be And to may our by optimistic, opportunity. value-enhancing at again, to layout will room come combined to, and and between But allow that us increasing Wyndham the with of definitive higher be of news count of this more add but looking resort resort, call, possibility that kind we'll We category this door. on definitely would value-enhancing. room probably course the due actually our next are the

we that's Los Cabos same Puerto So golden different. Los "Hey, so was to business in kind Vallarta. have This trying And renovation, Transient as as Ryan Cabos the behind -- MICE that goose that been we're with described very the well that goal like, and is of protect business." the one very,

shooting we're really We opportunity what exceptional here to for. something create and have an that's

Chris Woronka

Very Okay. that. good. Appreciate all

Bruce Wardinski

With to that, to I up catching look Appreciate think very we've forward we covered on much. get Thank call. and want you today. everything questions the we our through next earnings

Operator

now Thank concluded. for presentation. attending The conference has you today's

You disconnect. may now

Playa Hotels & Resorts (PLYA) 6 Aug 242024 Q2 Earnings call transcript