Investor Presentaiton
Definitions (cont'd)
Occupancy
Occupancy represents the total number of room nights sold divided by the total number of room nights available at a hotel or group of hotels.
Occupancy measures the utilization of the Company's hotels' available capacity. Management uses occupancy to gauge demand at a specific hotel
or group of hotels in a given period. Occupancy levels also help management determine achievable Average Daily Rate ("ADR") levels as demand
for hotel rooms increases or decreases.
Average Daily Rate
ADR represents rooms revenue divided by total number of room nights sold in a given period. ADR measures average room price attained by a hotel
and ADR trends provide useful information concerning the pricing environment and the nature of the customer base of a hotel or group of hotels.
ADR is a commonly used performance measure in the hotel industry, and management uses ADR to assess pricing levels that the Company is able
to generate by type of customer, as changes in rates have a more pronounced effect on overall revenues and incremental profitability than changes
in occupancy, as described above.
Revenue per Available Room
Revenue per Available Room ("RevPAR") represents rooms revenue divided by total number of room nights available to guests for a given period.
Management considers RevPAR to be a meaningful indicator of the Company's performance as it provides a metric correlated to two primary and
key factors of operations at a hotel or group of hotels: occupancy and ADR. RevPAR is also a useful indicator in measuring performance over
comparable periods for comparable hotels.
References to RevPAR and ADR are presented on a currency neutral basis (prior periods are reflected using the current period exchange rates),
unless otherwise noted.
Pro-forma
Certain financial measures and other information have been adjusted for the Company's historical debt and related balances and interest expense to
give the net effect to financing transactions that were completed prior to spin-off, incremental fees based on the terms of the post spin-off
management agreements, adjustments to income tax expense based on the Company's post spin-off REIT tax structure, the removal of costs
incurred related to the spin-off and the establishment of Park as a separate public company and the estimated excise taxes on certain REIT leases.
Further adjustments have been made to reflect the effects of hotels disposed of or acquired during the periods presented. When presenting such
information, the amounts are identified as "Pro-forma."
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