“Second-quarter results improved significantly as travel demand rebounded sharply in certain markets,” said Mark Hoplamazian, president/CEO, Hyatt Hotels Corporation. “While leisure travel continues to lead the recovery, we are very encouraged by continued improvements in business transient and group. Accelerating RevPAR growth expanded our operating leverage and as a result we generated positive adjusted EBITDA and operating cash flow in the quarter.”

Second-quarter 2021 highlights:

  • Adjusted EBITDA increased compared to the second quarter of 2020, to $55 million.

  • Comparable system-wide RevPAR increased to $72.47 in the second quarter of 2021, and decreased 49.8% compared to the second quarter 2019 on a reported basis.

  • Comparable owned and leased hotels RevPAR increased to $86.66 in the second quarter of 2021 and decreased 53.4% compared to the second quarter 2019 on a reported basis.

  • Net rooms growth of 7.1%.

  • As of June 30, the company had cash, cash equivalents and short-term investments of $1,737 million.

Hoplamazian continued, “While the recovery is likely to remain uneven over the coming months, we remain confident in continued momentum in RevPAR growth given positive forward-looking indicators in our business. Furthermore, the strength of our brands continues to yield industry-leading net rooms growth. We opened 100 properties over the last 12 months and maintain a strong pipeline representing more than 40% of our existing rooms.”

Operational update
Comparable system-wide RevPAR strengthened over the course of the second quarter of 2021, increasing nearly 30% from April-June 2021, and reaching the highest level since February 2020. Results in the second quarter were driven by very strong leisure transient demand, particularly in the U.S. and Greater China, where leisure transient revenue was fully recovered to 2019 levels. Group and business transient demand also gained momentum through the second quarter.

Comparable owned and leased hotels RevPAR strengthened through the second quarter of 2021, increasing nearly 50% from April-June 2021. At June 30, comparable owned and leased hotels RevPAR was at an approximate 30% premium to comparable system-wide RevPAR, consistent with historical trends. The RevPAR premium drove significant operating leverage resulting in $12 million of adjusted EBITDA in owned and leased hotels segment in the second quarter, nearly all of which occurred in the month of June.

As of June 30, 98% of total system-wide hotels (97% of rooms) were open.

Second quarter results

Second-quarter 2021 financial results as compared to second-quarter 2020 are as follows:

Management, franchise and other fees
Management and franchise fee revenues totaled $77 million in the second quarter of 2021 compared to $12 million reported in the second quarter of 2020, and reflected a sequential improvement from $49 million reported in the first quarter of 2021. The increase in total management and franchise fee revenues reflects a continued demand recovery from the onset of the COVID-19 pandemic inclusive of incentive fees which benefited from favorable operating leverage. Other fee revenues increased 99.9% to $16 million driven primarily by an increase in license fees related to our co-branded credit card.

Americas management and franchising segment
Americas management and franchising segment adjusted EBITDA increased to $54 million in the second quarter of 2021 compared to -$3 million reported in the second quarter of 2020. Results were led by the strong recovery in the U.S. At June 30, 99% of Hyatt’s Americas full- and select-service hotels (98% of rooms) were open.

Americas net rooms increased 5.2% compared to the second quarter of 2020.

ASPAC management and franchising segment
Southeast Asia, Greater China, Australia, New Zealand, South Korea, Japan and Micronesia (ASPAC) management and franchising segment adjusted EBITDA increased to $10 million in the second quarter of 2021 compared to -$2 million reported in the second quarter of 2020. Results across the region were led by Greater China. At June 30, 96% of Hyatt’s ASPAC full- and select-service hotels (97% of rooms) were open.

ASPAC net rooms increased 13.5% compared to the second quarter of 2020.

EAME/SW Asia management and franchising segment
Europe, Africa, Middle East and Southwest Asia (EAME/SW Asia) management and franchising segment adjusted EBITDA increased to -$1 million in the second quarter of 2021 compared to -$11 million reported in the second quarter of 2020. Results across the region were driven primarily by recovery in the Middle East and Eastern Europe and reduced selling, general and administrative expenses. At June 30, 97% of Hyatt’s EAME/SW Asia full- and select-service hotels (96% of rooms) were open.

EAME/SW Asia net rooms increased 7.5% compared to the second quarter of 2020.

Owned and leased hotels segment
Total owned and leased hotels segment adjusted EBITDA increased to $12 million in the second quarter of 2021 compared to -$78 million reported in the second quarter of 2020. Owned and leased hotels segment results improved meaningfully over the quarter led by strong leisure transient demand in various markets in the U.S.

At June 30, 97% of Hyatt’s owned and leased hotels (92% of rooms) were open.

Openings and future expansion
A total of 27 new hotels (or 4,302 rooms) opened in the second quarter of 2021, contributing to a 7.1% increase in net rooms compared to the second quarter of 2020.

As of June 30, the company had executed management or franchise contracts for approximately 495 hotels (or approximately 101,000 rooms). This compares to approximately 490 hotels (or approximately 100,000 rooms) as of March 31.

Transaction/capital strategy update
During the second quarter, the company completed the following transactions:

On June 3, a Hyatt affiliate acquired the 59-room Ventana Big Sur, an Alila Resort, located in Big Sur, CA for approximately $148 million, securing the company’s long-term brand presence in a highly sought-after resort destination.

On June 4, a Hyatt affiliate sold the 490-room Hyatt Regency Lost Pines Resort and Spa near Austin for approximately $275 million to an unrelated third party and entered into a long-term management agreement.

The company intends to successfully execute plans to sell approximately $1.5 billion of real estate by March 2022 as part of its capital strategy announced in March of 2019. As of June 30, 2021, the Company has realized net proceeds of approximately $1.1 billion towards that goal while continuing to expand its management and franchising business.

2021 outlook
The company is providing the following guidance for the 2021 fiscal year:

  • Adjusted selling, general and administrative expenses are expected to be approximately $240 million.

  • CapEx are expected to be approximately $110 million.

  • The company expects net rooms growth to be greater than 6.0%.