Ryman Hospitality Achieves Record Revenue, Revises 2024 Guidance
Ryman Hospitality Properties, Inc. (NYSE: RHP), a leading real estate investment trust focused on upscale convention center hotels, reported record consolidated total revenue of $550 million for the third quarter of 2024, representing a 4.1% year-over-year increase. The company’s adjusted EBITDA also rose to $175 million, up 2.3% from last year. This financial growth is attributed to strong performance in both the hospitality and entertainment segments, with the Ole Red brand making a significant contribution to the entertainment segment's record revenue.
Key Points:
- Ryman Hospitality Properties achieved record consolidated total revenue of $550 million in Q3 2024.
- Adjusted EBITDA increased to $175 million, a 2.3% year-over-year rise.
- The company raised the midpoint of its consolidated adjusted EBITDA guidance for 2024 to $770.5 million.
- Capital investments continue to exceed $1 billion, including projects at Gaylord Rockies and Gaylord Opryland.
- A new venue named Category 10 opened in Nashville and is set to be fully operational in early 2025.
- The company announced a quarterly dividend of $1.15, a 4.5% increase over the previous distribution.
Company Outlook: Ryman Hospitality revised its 2024 guidance by narrowing its RevPAR growth and adjusted EBITDA ranges due to market softness and construction disruptions. The midpoint for consolidated adjusted EBITDA guidance was raised to $770.5 million, reflecting an 11.5% increase compared to the prior year. Total capital investments for the full year 2024 are expected to be between $400 million and $450 million. The company is exploring a potential expansion at Gaylord Rockies, targeting an additional 450 rooms.
Negative Aspects: The company cited entertainment softness in certain markets and construction disruptions as factors necessitating the guidance revisions. Management discussed the impact of Hurricane Milton as contributing to the need for adjustments in guidance.
Positive Aspects: Ryman Hospitality reported success in its multi-year investment strategy with anticipated revenue growth for 2026 and 2027. The company remains optimistic about ongoing performance and future growth opportunities, focusing on raising room rates toward an 80% occupancy target.
Shortcomings: Despite increased investments, the adjusted EBITDA for JW Marriott Hill Country remained flat year-over-year at $17.5 million.
Q&A Highlights: Management emphasized strong pricing despite potentially lower occupancy levels. The new hotel in the San Diego market positively contributed to bookings with over 200,000 room nights reserved at a 9% premium to the average daily rate (ADR). The company successfully improved margins despite pricing pressures by enhancing efficiencies and increasing both entertainment and group rates.
Ryman Hospitality Properties, Inc. (NYSE: RHP) finished the third quarter with record revenues and a secure outlook for the future. Strategic investments in properties and entertainment venues, such as the newly opened Category 10 in Nashville, are expected to drive continued growth and enhance customer satisfaction. Despite facing challenges like market softness and the impact of Hurricane Milton, Ryman Hospitality is well-positioned to navigate these obstacles and capitalize on opportunities in the hospitality sector due to its strong liquidity profile and focus on operational efficiency.
InvestingPro Forecasts: The robust financial performance of Ryman Hospitality Properties in Q3 2024 is supported by data from InvestingPro. The company's revenue growth of 12.62% over the past twelve months aligns with the reported record consolidated total revenue. This growth trend is complemented by a strong EBITDA growth of 16.99% for the same period, highlighting the company's ability to convert high-level growth into improved profitability.
InvestingPro Insights emphasize that RHP trades at a low P/E ratio relative to its near-term earnings growth, with a PEG ratio of 0.39. This suggests that the stock may be undervalued considering its growth prospects, making it attractive for value-focused investors. Additionally, the company's 4.06% dividend yield and 10% dividend growth rate over the past twelve months reinforce its commitment to shareholder returns consistent with the discussion on the recent increase in quarterly dividends.
The company's profitability is further underscored by an InvestingPro Insight showing RHP has been profitable over the past twelve months, with a healthy operating income margin of 21.54%. This profitability, coupled with liquid assets exceeding short-term liabilities, signals a solid financial foundation supporting the ambitious capital investment plans outlined in the article.
For investors seeking a more comprehensive analysis, InvestingPro offers five additional insights that can provide deeper understanding of Ryman Hospitality Properties' financial health and market position.