TYSONS, Va.--(BUSINESS WIRE)--Park Hotels & Resorts Inc. (NYSE: PK) (the “Company” or “Park”) today announced that it is has withdrawn its previously announced 2020 outlook amid growing concerns about the COVID-19 virus outbreak. Since providing guidance nearly two weeks ago, Park has experienced a material increase in the number of corporate group cancellations. Additionally, increasing travel restrictions, governmental travel advisories and state of emergency declarations across several of our key markets are expected to adversely impact the Company’s financial results for the full year 2020.
On February 26, 2020, as part of the Company's full-year 2019 earnings press release, Park provided full-year 2020 guidance which included approximately $8 million of lost rooms revenues resulting primarily from known group customer cancellations related to COVID-19. Largely over the last week, the Company has experienced a material increase in expected lost rooms revenue from group customer cancellations, which, as of today's date, have increased to approximately $30 million, with most of that impact expected to occur in March and April.
“Since our earnings call on February 27, 2020, the situation related to COVID-19 has evolved rapidly, creating a notable economic impact to our business,” said Thomas J. Baltimore, Jr., Chairman and CEO of Park. “In addition to the anticipated impact to inbound international travel, during the past week we have seen an increase in group and business transient cancellations as corporate customers pause and assess the highly fluid and uncertain environment. Consequently, we expect to see a material impact in the first half of this year. However, given the short-term nature of the cancellations and the uncertainty of how long the COVID-19 outbreak will last, we cannot provide a view on our 2020 outlook at this time. While we currently expect to recoup some of the lost revenue in the form of cancellation fees as well as rebooked events, we are primarily focused on implementing cost containment strategies across our portfolio as well as ensuring the health and safety of all employees and guests in our hotels. I am confident our teams will thoughtfully adapt to this changing environment and employ best practices from our pool of highly experienced leaders both on property and among our corporate team.”
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include, but are not limited to, statements related to Park’s current expectations regarding the performance of its business, financial results, liquidity and capital resources, the effects of competition and the effects of future legislation or regulations, and other non-historical statements. Forward-looking statements include all statements that are not historical facts, and in some cases, can be identified by the use of forward-looking terminology such as the words “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “could,” “seeks,” “projects,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words.
Forward-looking statements involve risks, uncertainties and assumptions. Actual results may differ materially from those expressed in these forward-looking statements. You should not put undue reliance on any forward-looking statements and Park urges investors to carefully review the disclosures Park makes concerning risk and uncertainties in Item 1A: “Risk Factors” in Park’s Annual Report on Form 10-K for the year ended December 31, 2019, as such factors may be updated from time to time in Park’s filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. Except as required by law, Park undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
About Park Hotels & Resorts
Park Hotels & Resorts Inc. (NYSE: PK) is the second largest publicly traded lodging real estate investment trust with a diverse portfolio of market-leading hotels and resorts with significant underlying real estate value. Park’s portfolio currently consists of 60 premium-branded hotels and resorts with over 33,000 rooms located in prime U.S. markets with high barriers to entry. For additional information, please visit Park's website at www.pkhotelsandresorts.com.
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