Release Date: February 26, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Playa Hotels & Resorts NV (NASDAQ:PLYA) exceeded expectations for the fourth quarter of 2024, driven by strong demand across all segments.
• The company experienced better than expected ADR growth in the Pacific coast, Yucatan, and Dominican Republic.
• Foreign currency exchange provided a tailwind of approximately $2 million, positively impacting financial results.
• The company completed the sale of the Jewel Puntaconda resort, contributing to financial performance.
• Playa Hotels & Resorts NV (NASDAQ:PLYA) repurchased approximately $25 million worth of stock during the fourth quarter, enhancing shareholder value.

Negative Points

• Underlying owned resort EBITDA growth was down approximately 15% in the fourth quarter for the total portfolio.
• The fourth quarter was challenged by construction disruption in the Pacific coast and the lingering impact of Hurricane Beryl.
• The US State Department travel advisory negatively impacted the Jamaican segment.
• Jamaica experienced a significant 50% decline in resort EBITDA due to a 16% RevPAR decline.
• Construction disruption in the Pacific coast was approximately $10 million worse than expected.

Q & A Highlights

• Warning! GuruFocus has detected 3 Warning Sign with PLYA.

Q: Can you provide an overview of Playa Hotels & Resorts' financial performance in Q4 2024? A: Bruce Wardinski, CEO, highlighted that the company's Q4 2024 results exceeded expectations due to strong demand across all segments, finishing with a robust holiday season. The owned resort EBITDA was $67.1 million, including a $1.1 million benefit from business interruption insurance. Excluding this, the upside was driven by better-than-expected demand and ADR growth, lower corporate expenses, and a favorable foreign currency exchange tailwind.

Q: How did the recent hurricanes impact Playa Hotels & Resorts' operations and financials? A: The CEO noted that Hurricane Beryl significantly impacted the second half of the year, particularly affecting the Jamaica segment. The travel warning for Jamaica also had a substantial financial impact, estimated at $25 to $30 million. Despite these challenges, the company managed to improve sequentially in Q4.

Q: What strategic actions did Playa Hotels & Resorts take in terms of asset sales? A: Bruce Wardinski mentioned the completion of the sale of the Jewel Puntacana resort in December 2023 and the Jewel Paradise Cove resort in February 2025 for $28.5 million. These sales are part of the company's strategy to optimize its portfolio.

Q: How is Playa Hotels & Resorts managing its foreign exchange exposure? A: The CFO, Ryan Hymel, stated that the company has implemented FX hedges on approximately 75% of its Mexican peso exposure for 2025 at an exchange rate of approximately 19.5, compared to an average incurred exchange rate of 18.3 in 2024. This is expected to result in a favorable year-over-year FX benefit.

Q: What is the status of the potential transaction with Hyatt Hotels Corporation? A: The CEO confirmed that Playa Hotels & Resorts entered into an agreement with Hyatt, where Hyatt will acquire all outstanding shares for $13.50 per share in cash. The board recommended in favor of the tender offer, and the transaction is seen as a positive outcome for shareholders.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.