The following is a summary of the Sunstone Hotel Investors, Inc. (SHO) Q1 2024 Earnings Call Transcript:
Financial Performance:
Sunstone Hotel Investors met Q1 expectations, driven by strong out-of-room spend and cost control.
The Company's Board declared a 29% increase in their quarterly dividend to $0.09 per share due to increased income from recent investments.
Reported adjusted EBITDA for the first quarter was $55 million and adjusted FFO was $0.18 per diluted share.
Total earnings disruption expected to be around $13M to $15M this year, largely due to construction and permitting delays.
Full-year adjusted EBITDA is projected to range from $242 million to $263 million, and adjusted FFO per diluted share will range between $0.84 to $0.94.
The company has over $240 million of total cash and cash equivalents and nearly $740 million of total liquidity.
Business Progress:
Acquisition of Hyatt Regency San Antonio Riverwalk demonstrates strategic investment to generate near-term growth.
Sunstone's construction at the Andaz Miami Beach is on schedule to be completed by the end of the year, reflecting solid operational progress.
Continued growth expected from the initial performance of its newly converted Westin in Washington, DC.
The company is focusing on structuring their portfolio to provide diversified, immediate earnings, with emphasis on hotels with significant group components.
They are actively evaluating additional acquisition opportunities, prioritizing assets where they can redeploy capital for higher yields.
Future investments are aimed at value-add sectors, leveraging asset managers to optimize opportunities.
The Board increased the base quarterly common dividend, indicating confidence in their growth strategy.
Proceeds from the Boston asset sale are expected to be redeployed either in hotel acquisitions or share repurchase, reflecting an adaptive financial strategy.
More details: Sunstone Hotel Investors Inc IR
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