10-Q 1 pk-20220930.htm 10-Q 10-Q
000161740601--12-31falseQ30001617406us-gaap:OccupancyMember2022-01-012022-09-300001617406pk:HiltonDenverCityCenterMortgageLoanMember2022-01-012022-09-300001617406us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberus-gaap:MortgagesMember2021-12-310001617406us-gaap:NoncontrollingInterestMember2021-07-012021-09-300001617406pk:TwoThousandTwentyFiveSeniorSecuredNotesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-09-300001617406us-gaap:CommonStockMember2022-04-012022-06-300001617406us-gaap:RestrictedStockMember2021-12-310001617406us-gaap:RevolvingCreditFacilityMember2020-05-012020-05-310001617406pk:ConsolidatedHotelsSegmentMember2022-01-012022-09-300001617406pk:TwoThousandAndTwentyEightSeniorSecuredNotesMember2022-09-300001617406pk:AncillaryHotelMember2021-07-012021-09-300001617406us-gaap:MortgagesMember2022-01-012022-09-3000016174062022-04-012022-06-300001617406us-gaap:FoodAndBeverageMember2021-01-012021-09-300001617406us-gaap:NoncontrollingInterestMember2021-12-310001617406us-gaap:RevolvingCreditFacilityMember2022-01-012022-09-300001617406pk:TwoThousandAndTwentyFiveSeniorSecuredNotesMember2022-09-300001617406pk:TwoThousandNineteenTermFacilityMember2021-12-310001617406pk:HamptonInnSuitesMemphisShadyGroveMember2022-01-012022-09-300001617406us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-03-310001617406us-gaap:FoodAndBeverageMember2021-07-012021-09-300001617406pk:TwoThousandAndTwentyNineSeniorSecuredNotesMember2022-01-012022-09-300001617406us-gaap:EmployeeStockOptionMember2022-09-300001617406us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberpk:TwoThousandTwentyEightSeniorSecuredNotesMember2021-12-310001617406us-gaap:PerformanceSharesMember2021-12-310001617406us-gaap:FairValueInputsLevel1Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberpk:TwoThousandAndTwentyNineSeniorSecuredNotesMember2022-09-300001617406us-gaap:PerformanceSharesMember2022-09-300001617406pk:CommercialMortgagedBackedSecuritiesLoansAndMortgageLoansMember2022-09-300001617406us-gaap:RetainedEarningsMember2021-01-012021-03-310001617406us-gaap:CommonStockMember2022-06-300001617406us-gaap:FoodAndBeverageMember2022-07-012022-09-300001617406pk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2021-12-310001617406us-gaap:LondonInterbankOfferedRateLIBORMemberus-gaap:RevolvingCreditFacilityMember2022-01-012022-09-300001617406us-gaap:CommonStockMember2022-01-012022-03-310001617406us-gaap:FairValueInputsLevel1Memberpk:TwoThousandAndTwentyNineSeniorSecuredNotesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001617406us-gaap:RevolvingCreditFacilityMember2022-07-012022-07-310001617406us-gaap:PerformanceSharesMember2022-01-012022-09-300001617406pk:AncillaryHotelMember2022-01-012022-09-3000016174062021-06-300001617406pk:HotelAdagioAutographCollectionMember2021-01-012021-09-300001617406us-gaap:RetainedEarningsMember2021-06-300001617406pk:TwoThousandNineteenTermFacilityMember2022-01-012022-09-300001617406us-gaap:AllOtherSegmentsMember2021-12-310001617406us-gaap:CommonStockMember2022-03-310001617406us-gaap:OccupancyMember2022-07-012022-09-300001617406us-gaap:NoncontrollingInterestMember2022-07-012022-09-300001617406us-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberpk:TwoThousandTwentyEightSeniorSecuredNotesMember2022-09-300001617406pk:AllOthersFiveHotelsMembersrt:MaximumMember2022-09-300001617406us-gaap:NoncontrollingInterestMember2022-06-300001617406pk:HiltonGardenInnLaxElSegundoMember2022-01-012022-09-300001617406us-gaap:SubsequentEventMemberpk:DoubletreeHotelLasVegasAirportMember2022-10-012022-10-3100016174062022-01-012022-03-310001617406us-gaap:HotelOtherMember2022-01-012022-09-300001617406us-gaap:HotelOtherMember2021-07-012021-09-300001617406us-gaap:NoncontrollingInterestMember2021-01-012021-03-310001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMember2021-12-310001617406pk:OtherDepartmentalAndSupportMember2021-07-012021-09-300001617406us-gaap:NoncontrollingInterestMember2022-01-012022-03-310001617406us-gaap:OccupancyMember2021-01-012021-09-3000016174062021-07-012021-09-300001617406pk:HiltonSanDiegoBayfrontMember2022-09-300001617406us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberpk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2021-12-310001617406us-gaap:RetainedEarningsMember2022-03-310001617406us-gaap:RetainedEarningsMember2022-07-012022-09-300001617406us-gaap:MortgagesMember2021-12-310001617406pk:ConsolidatedHotelsSegmentMember2022-07-012022-09-300001617406us-gaap:AllOtherSegmentsMember2021-01-012021-09-300001617406srt:MaximumMemberus-gaap:EmployeeStockOptionMember2022-09-300001617406pk:ConsolidatedHotelsSegmentMember2021-01-012021-09-300001617406pk:PKDomesticAndPKFinanceCoIssuerIncMemberpk:TwoThousandAndTwentyNineSeniorSecuredNotesMember2021-05-3100016174062021-12-3100016174062022-03-310001617406us-gaap:RetainedEarningsMember2020-12-310001617406us-gaap:FairValueInputsLevel3Memberus-gaap:MortgagesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-09-300001617406us-gaap:AllOtherSegmentsMember2022-09-300001617406us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberpk:TwoThousandNineteenTermFacilityMember2022-09-300001617406us-gaap:AllOtherSegmentsMember2022-07-012022-09-300001617406us-gaap:NoncontrollingInterestMember2021-03-3100016174062021-01-012021-03-310001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMember2022-09-300001617406us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberpk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2021-12-310001617406pk:ConsolidatedHotelsSegmentMember2021-12-310001617406pk:CommercialMortgagedBackedSecuritiesLoansAndMortgageLoansMember2021-12-310001617406pk:TwoThousandAndTwentyFiveSeniorSecuredNotesMember2021-12-310001617406srt:MaximumMemberpk:NonEmployeeStockOptionMember2022-09-300001617406us-gaap:FairValueInputsLevel1Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberpk:TwoThousandTwentyEightSeniorSecuredNotesMember2022-09-300001617406us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-01-012021-03-310001617406us-gaap:AdditionalPaidInCapitalMember2021-06-300001617406us-gaap:CommonStockMember2021-09-300001617406us-gaap:AdditionalPaidInCapitalMember2022-09-300001617406pk:ParkIntermediateHoldingsLimitedLiabilityCompanyMember2017-01-030001617406us-gaap:RetainedEarningsMember2022-06-300001617406pk:CourtyardWashingtonCapitolHillNavyYardMember2021-01-012021-09-300001617406pk:OtherDepartmentalAndSupportMember2022-07-012022-09-300001617406pk:AllOthersFiveHotelsMember2022-09-300001617406us-gaap:CommonStockMember2021-03-310001617406pk:BonnetCreekComplexMember2022-09-300001617406us-gaap:RetainedEarningsMember2021-09-300001617406us-gaap:HotelOtherMember2021-01-012021-09-300001617406us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberus-gaap:MortgagesMember2022-09-300001617406pk:NonEmployeeStockOptionMember2022-09-300001617406pk:TwoThousandTwentyFiveSeniorSecuredNotesMemberus-gaap:FairValueInputsLevel1Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001617406srt:MinimumMemberpk:SpecialAwardsMemberus-gaap:PerformanceSharesMember2020-11-012020-11-300001617406pk:AllOthersFiveHotelsMembersrt:MinimumMember2022-09-3000016174062022-09-300001617406srt:MaximumMemberpk:SpecialAwardsMemberus-gaap:PerformanceSharesMember2020-11-012020-11-300001617406us-gaap:AllOtherSegmentsMember2021-07-012021-09-300001617406us-gaap:AccumulatedOtherComprehensiveIncomeMember2020-12-3100016174062022-07-012022-09-300001617406us-gaap:NoncontrollingInterestMember2020-12-310001617406pk:SpecialAwardsMemberus-gaap:PerformanceSharesMemberpk:EightSharePriceTargetsMember2020-11-012020-11-300001617406us-gaap:AdditionalPaidInCapitalMember2022-03-310001617406us-gaap:AdditionalPaidInCapitalMember2021-01-012021-03-310001617406pk:ConsolidatedHotelsSegmentMember2022-09-300001617406us-gaap:RestrictedStockMember2022-09-300001617406us-gaap:AdditionalPaidInCapitalMember2022-07-012022-09-300001617406us-gaap:AllOtherSegmentsMember2022-01-012022-09-300001617406us-gaap:FairValueInputsLevel3Memberpk:TwoThousandNineteenTermFacilityMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001617406us-gaap:CommonStockMember2020-12-310001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001617406srt:MaximumMemberpk:SpecialAwardsMemberus-gaap:PerformanceSharesMember2022-01-012022-06-300001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Member2021-12-3100016174062021-01-012021-09-300001617406us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-06-3000016174062021-09-300001617406us-gaap:RetainedEarningsMember2022-09-300001617406us-gaap:FairValueInputsLevel1Memberpk:TwoThousandTwentyFiveSeniorSecuredNotesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2022-09-300001617406us-gaap:NoncontrollingInterestMember2022-03-310001617406us-gaap:AdditionalPaidInCapitalMember2022-01-012022-03-310001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMember2016-10-310001617406pk:AllOthersFiveHotelsMember2021-12-310001617406us-gaap:RetainedEarningsMember2022-04-012022-06-300001617406us-gaap:RetainedEarningsMember2021-07-012021-09-300001617406us-gaap:AdditionalPaidInCapitalMember2021-04-012021-06-300001617406pk:TwoThousandAndTwentyFiveSeniorSecuredNotesMemberpk:PKDomesticAndPKFinanceCoIssuerIncMember2020-05-310001617406pk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2022-01-012022-09-300001617406us-gaap:RetainedEarningsMember2021-12-310001617406us-gaap:AdditionalPaidInCapitalMember2022-04-012022-06-3000016174062020-12-310001617406pk:ChesapeakeLodgingTrustMember2019-05-050001617406us-gaap:FoodAndBeverageMember2022-01-012022-09-3000016174062022-01-012022-09-300001617406pk:ConsolidatedHotelsSegmentMember2021-07-012021-09-300001617406pk:TwoThousandAndTwentyEightSeniorSecuredNotesMember2021-12-310001617406pk:HhvMortgageLoanAndHiltonDenverCityCenterSecuredMortgageLoanMember2022-09-300001617406pk:TwoThousandAndTwentyNineSeniorSecuredNotesMember2021-12-310001617406pk:HomewoodSuitesByHiltonSeattleConventionCenterPikeStreetMember2022-01-012022-09-300001617406us-gaap:OccupancyMember2021-07-012021-09-300001617406pk:OtherDepartmentalAndSupportMember2021-01-012021-09-300001617406pk:HiltonChicagoMember2022-01-012022-09-300001617406us-gaap:FairValueInputsLevel1Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberpk:TwoThousandTwentyEightSeniorSecuredNotesMember2021-12-310001617406pk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2022-09-300001617406pk:HiltonSanDiegoBayfrontMember2021-12-310001617406us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberpk:TwoThousandNineteenTermFacilityMember2021-12-310001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMember2022-01-012022-09-300001617406pk:TwoThousandNineteenTermFacilityMember2022-09-300001617406us-gaap:RevolvingCreditFacilityMember2021-12-310001617406us-gaap:NoncontrollingInterestMember2022-09-3000016174062022-06-3000016174062022-01-012022-06-300001617406us-gaap:HotelOtherMember2022-07-012022-09-300001617406pk:HotelIndigoSanDiegoGaslampQuarterMember2021-01-012021-09-300001617406us-gaap:NoncontrollingInterestMember2021-09-300001617406pk:PKDomesticAndPKFinanceCoIssuerIncMemberpk:TwoThousandAndTwentyEightSeniorSecuredNotesMember2020-09-300001617406us-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMemberpk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2022-09-300001617406us-gaap:AdditionalPaidInCapitalMember2022-06-300001617406us-gaap:AdditionalPaidInCapitalMember2020-12-310001617406us-gaap:FairValueInputsLevel1Memberpk:TwoThousandAndTwentyNineSeniorSecuredNotesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-09-300001617406pk:HiltonSanDiegoBayfrontMember2022-01-012022-06-300001617406us-gaap:RevolvingCreditFacilityMember2022-09-300001617406us-gaap:CommonStockMember2021-12-310001617406pk:OtherDepartmentalAndSupportMember2022-01-012022-09-300001617406us-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Memberpk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2022-09-300001617406us-gaap:MortgagesMember2022-09-300001617406pk:TwoThousandAndTwentyEightSeniorSecuredNotesMember2022-01-012022-09-300001617406us-gaap:AdditionalPaidInCapitalMember2021-07-012021-09-300001617406us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2022-09-300001617406pk:AncillaryHotelMember2021-01-012021-09-300001617406us-gaap:FairValueInputsLevel3Memberpk:TwoThousandNineteenTermFacilityMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-09-300001617406us-gaap:RetainedEarningsMember2022-01-012022-03-310001617406pk:LeMeridienSanFranciscoMember2021-01-012021-09-300001617406us-gaap:RestrictedStockMember2022-01-012022-09-300001617406us-gaap:NoncontrollingInterestMember2022-04-012022-06-300001617406us-gaap:RetainedEarningsMember2021-04-012021-06-300001617406pk:AncillaryHotelMember2022-07-012022-09-300001617406pk:HurricanesIanAndFionaMember2022-01-012022-09-300001617406pk:SpecialAwardsMemberus-gaap:PerformanceSharesMemberpk:EightSharePriceTargetsMember2022-01-012022-09-3000016174062021-04-012021-06-300001617406pk:HiltonHawaiianVillageCommercialMortgagedBackedSecuritiesLoanMember2016-10-310001617406us-gaap:VariableInterestEntityPrimaryBeneficiaryMember2021-12-310001617406us-gaap:FairValueInputsLevel1Memberpk:TwoThousandTwentyFiveSeniorSecuredNotesMemberus-gaap:CarryingReportedAmountFairValueDisclosureMember2021-12-310001617406pk:TwoThousandNineteenTermFacilityMember2022-07-012022-07-310001617406us-gaap:CommonStockMember2021-06-300001617406pk:WNewOrleansFrenchQuarterMember2021-01-012021-09-300001617406us-gaap:NoncontrollingInterestMember2021-04-012021-06-300001617406us-gaap:AdditionalPaidInCapitalMember2021-09-300001617406us-gaap:AdditionalPaidInCapitalMember2021-12-310001617406us-gaap:NoncontrollingInterestMember2021-06-300001617406us-gaap:FairValueInputsLevel3Memberus-gaap:MortgagesMemberus-gaap:EstimateOfFairValueFairValueDisclosureMember2021-12-310001617406pk:TwoThousandAndTwentyNineSeniorSecuredNotesMember2022-09-300001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMemberus-gaap:FairValueInputsLevel3Memberus-gaap:EstimateOfFairValueFairValueDisclosureMember2022-09-300001617406us-gaap:FairValueInputsLevel1Memberus-gaap:CarryingReportedAmountFairValueDisclosureMemberpk:TwoThousandAndTwentyNineSeniorSecuredNotesMember2021-12-310001617406us-gaap:LondonInterbankOfferedRateLIBORMemberpk:TwoThousandNineteenTermFacilityMember2022-01-012022-09-300001617406us-gaap:RetainedEarningsMember2021-03-3100016174062022-10-280001617406pk:TwoThousandAndTwentyFiveSeniorSecuredNotesMember2022-01-012022-09-3000016174062021-03-310001617406us-gaap:CommonStockMember2022-09-300001617406us-gaap:AdditionalPaidInCapitalMember2021-03-310001617406pk:HiltonGardenInnChicagoOakBrookMember2022-01-012022-09-300001617406pk:SanFranciscoCommercialMortgagedBackedSecuritiesLoanMemberus-gaap:CarryingReportedAmountFairValueDisclosureMemberus-gaap:FairValueInputsLevel3Member2022-09-300001617406us-gaap:AccumulatedOtherComprehensiveIncomeMember2021-07-012021-09-30pk:Segmentxbrli:purepk:Entitypk:Hotelxbrli:sharesiso4217:USDxbrli:sharesutr:Diso4217:USDpk:Target

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 001-37795

 

Park Hotels & Resorts Inc.

(Exact name of Registrant as specified in its Charter)

 

Delaware

 

36-2058176

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S Employer

Identification No.)

 

1775 Tysons Boulevard, 7th Floor, Tysons, VA

 

22102

(Address of principal executive offices)

 

(Zip Code)

(Registrant’s telephone number, including area code): (571) 302-5757

 

 

Securities registered pursuant to Section 12(b) of the Act.

 

Title of each class

Trading Symbol

Name of exchange on which registered

Common Stock, $0.01 par value per share

PK

New York Stock Exchange

 

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No ☒

 

The number of shares of common stock outstanding on October 28, 2022 was 224,843,229.

 

 

 

 


 

Table of Contents

 

PART I. FINANCIAL INFORMATION

 

Page

 

 

 

 

Item 1.

Financial Statements (unaudited)

 

3

 

Condensed Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021

 

3

 

Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2022 and 2021

 

4

 

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2022 and 2021

 

5

 

Condensed Consolidated Statements of Equity for the Three and Nine Months Ended September 30, 2022 and 2021

 

6

 

Notes to Condensed Consolidated Financial Statements

 

7

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

15

Item 3.

Quantitative and Qualitative Disclosures About Market Risk

 

25

Item 4.

Controls and Procedures

 

25

 

 

 

 

PART II. OTHER INFORMATION

 

 

Item 1.

Legal Proceedings

 

26

Item 1A.

Risk Factors

 

26

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds

 

26

Item 3.

Defaults Upon Senior Securities

 

26

Item 4.

Mine Safety Disclosures

 

27

Item 5.

Other Information

 

27

Item 6.

Exhibits

 

28

 

Signatures

 

29

 

 

2


 

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

PARK HOTELS & RESORTS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except share and per share data)

 

 

 

September 30, 2022

 

 

December 31, 2021

 

 

 

(unaudited)

 

 

 

 

ASSETS

 

 

 

 

 

 

Property and equipment, net

 

$

8,292

 

 

$

8,511

 

Investments in affiliates

 

 

4

 

 

 

15

 

Intangibles, net

 

 

43

 

 

 

44

 

Cash and cash equivalents

 

 

971

 

 

 

688

 

Restricted cash

 

 

29

 

 

 

75

 

Accounts receivable, net of allowance for doubtful accounts of $2 and $2

 

 

144

 

 

 

96

 

Prepaid expenses

 

 

40

 

 

 

35

 

Other assets

 

 

39

 

 

 

69

 

Operating lease right-of-use assets

 

 

224

 

 

 

210

 

TOTAL ASSETS (variable interest entities - $240 and $237)

 

$

9,786

 

 

$

9,743

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

Debt

 

$

4,670

 

 

$

4,672

 

Accounts payable and accrued expenses

 

 

254

 

 

 

156

 

Due to hotel managers

 

 

123

 

 

 

111

 

Other liabilities

 

 

177

 

 

 

174

 

Operating lease liabilities

 

 

243

 

 

 

227

 

Total liabilities (variable interest entities - $220 and $219)

 

 

5,467

 

 

 

5,340

 

Commitments and contingencies - refer to Note 11

 

 

 

 

 

 

Stockholders' Equity

 

 

 

 

 

 

Common stock, par value $0.01 per share, 6,000,000,000 shares
   authorized,
225,354,874 shares issued and 224,842,791 shares outstanding
   as of September 30, 2022 and
236,888,804 shares issued and 236,483,990
   shares outstanding as of December 31, 2021

 

 

2

 

 

 

2

 

Additional paid-in capital

 

 

4,325

 

 

 

4,533

 

Retained earnings (accumulated deficit)

 

 

38

 

 

 

(83

)

Total stockholders' equity

 

 

4,365

 

 

 

4,452

 

Noncontrolling interests

 

 

(46

)

 

 

(49

)

Total equity

 

 

4,319

 

 

 

4,403

 

TOTAL LIABILITIES AND EQUITY

 

$

9,786

 

 

$

9,743

 

 

Refer to the notes to the unaudited condensed consolidated financial statements.

 

3


 

PARK HOTELS & RESORTS INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(unaudited, in millions, except per share data)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Revenues

 

 

 

 

 

 

 

 

 

 

 

 

Rooms

 

$

428

 

 

$

274

 

 

$

1,153

 

 

$

587

 

Food and beverage

 

 

148

 

 

 

76

 

 

 

431

 

 

 

152

 

Ancillary hotel

 

 

67

 

 

 

58

 

 

 

198

 

 

 

137

 

Other

 

 

19

 

 

 

15

 

 

 

54

 

 

 

35

 

Total revenues

 

 

662

 

 

 

423

 

 

 

1,836

 

 

 

911

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

Rooms

 

 

115

 

 

 

76

 

 

 

298

 

 

 

170

 

Food and beverage

 

 

115

 

 

 

63

 

 

 

321

 

 

 

126

 

Other departmental and support

 

 

162

 

 

 

119

 

 

 

453

 

 

 

298

 

Other property-level

 

 

58

 

 

 

51

 

 

 

173

 

 

 

151

 

Management fees

 

 

30

 

 

 

19

 

 

 

84

 

 

 

40

 

Casualty and impairment loss, net

 

 

3

 

 

 

2

 

 

 

4

 

 

 

7

 

Depreciation and amortization

 

 

67

 

 

 

68

 

 

 

204

 

 

 

213

 

Corporate general and administrative

 

 

16

 

 

 

14

 

 

 

48

 

 

 

48

 

Other

 

 

18

 

 

 

14

 

 

 

52

 

 

 

34

 

Total expenses

 

 

584

 

 

 

426

 

 

 

1,637

 

 

 

1,087

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (loss) on sales of assets, net

 

 

14

 

 

 

(11

)

 

 

13

 

 

 

(5

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (loss)

 

 

92

 

 

 

(14

)

 

 

212

 

 

 

(181

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

 

4

 

 

 

 

 

 

5

 

 

 

 

Interest expense

 

 

(61

)

 

 

(66

)

 

 

(185

)

 

 

(195

)

Equity in earnings (losses) from investments in affiliates

 

 

1

 

 

 

 

 

 

6

 

 

 

(6

)

Other gain (loss), net

 

 

1

 

 

 

(5

)

 

 

98

 

 

 

(7

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

 

37

 

 

 

(85

)

 

 

136

 

 

 

(389

)

Income tax benefit

 

 

3

 

 

 

3

 

 

 

2

 

 

 

2

 

Net income (loss)

 

 

40

 

 

 

(82

)

 

 

138

 

 

 

(387

)

Net income attributable to noncontrolling interests

 

 

(5

)

 

 

(4

)

 

 

(10

)

 

 

(5

)

Net income (loss) attributable to stockholders

 

$

35

 

 

$

(86

)

 

$

128

 

 

$

(392

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income, net of tax expense:

 

 

 

 

 

 

 

 

 

 

 

 

Change in fair value of interest rate swap, net of tax

 

 

 

 

 

1

 

 

 

 

 

 

2

 

Loss from interest rate swap reclassified into earnings

 

 

 

 

 

2

 

 

 

 

 

 

2

 

Total other comprehensive income

 

 

 

 

 

3

 

 

 

 

 

 

4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income (loss)

 

 

40

 

 

 

(79

)

 

 

138

 

 

 

(383

)

Comprehensive income attributable to noncontrolling interests

 

 

(5

)

 

 

(4

)

 

 

(10

)

 

 

(5

)

Comprehensive income (loss) attributable to stockholders

 

$

35

 

 

$

(83

)

 

$

128

 

 

$

(388

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) per share:

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (loss) per share – Basic

 

$

0.15

 

 

$

(0.36

)

 

$

0.55

 

 

$

(1.66

)

Earnings (loss) per share – Diluted

 

$

0.15

 

 

$

(0.36

)

 

$

0.55

 

 

$

(1.66

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding – Basic

 

 

224

 

 

 

236

 

 

 

229

 

 

 

236

 

Weighted average shares outstanding – Diluted

 

 

224

 

 

 

236

 

 

 

229

 

 

 

236

 

 

Refer to the notes to the unaudited condensed consolidated financial statements.

4


 

PARK HOTELS & RESORTS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited, in millions)

 

 

 

Nine Months Ended

 

 

 

September 30,

 

 

 

2022

 

 

2021

 

Operating Activities:

 

 

 

 

 

 

Net income (loss)

 

$

138

 

 

$

(387

)

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating
   activities:

 

 

 

 

 

 

Depreciation and amortization

 

 

204

 

 

 

213

 

(Gain) loss on sales of assets, net

 

 

(13

)

 

 

5

 

Casualty and impairment loss, net

 

 

4

 

 

 

7

 

Equity in (earnings) losses from investments in affiliates

 

 

(6

)

 

 

6

 

Other (gain) loss, net

 

 

(92

)

 

 

7

 

Share-based compensation expense

 

 

13

 

 

 

15

 

Amortization of deferred financing costs

 

 

7

 

 

 

9

 

Distributions from unconsolidated affiliates

 

 

6

 

 

 

 

Deferred income taxes

 

 

 

 

 

(1

)

Changes in operating assets and liabilities

 

 

78

 

 

 

31

 

Net cash provided by (used in) operating activities

 

 

339

 

 

 

(95

)

Investing Activities:

 

 

 

 

 

 

Capital expenditures for property and equipment

 

 

(104

)

 

 

(28

)

Proceeds from asset dispositions, net

 

 

143

 

 

 

454

 

Proceeds from the sale of investments in affiliates, net

 

 

101

 

 

 

 

Contributions to unconsolidated affiliates

 

 

 

 

 

(5

)

Insurance proceeds for property damage claims

 

 

 

 

 

4

 

Net cash provided by investing activities

 

 

140

 

 

 

425

 

Financing Activities:

 

 

 

 

 

 

Repayments of credit facilities

 

 

 

 

 

(1,193

)

Proceeds from issuance of Senior Secured Notes

 

 

 

 

 

750

 

Proceeds from issuance of mortgage debt

 

 

30

 

 

 

14

 

Repayments of mortgage debt

 

 

(36

)

 

 

(18

)

Debt issuance costs

 

 

(3

)

 

 

(15

)

Dividends paid

 

 

(5

)

 

 

 

Distributions to noncontrolling interests, net

 

 

(7

)

 

 

(2

)

Tax withholdings on share-based compensation

 

 

(3

)

 

 

(5

)

Repurchase of common stock

 

 

(218

)

 

 

 

Net cash used in financing activities

 

 

(242

)

 

 

(469

)

Net increase (decrease) in cash and cash equivalents and restricted cash

 

 

237

 

 

 

(139

)

Cash and cash equivalents and restricted cash, beginning of period

 

 

763

 

 

 

981

 

Cash and cash equivalents and restricted cash, end of period

 

$

1,000

 

 

$

842

 

 

 

 

 

 

 

 

Supplemental Disclosures

 

 

 

 

 

 

Non-cash financing activities:

 

 

 

 

 

 

Dividends declared but unpaid

 

$

2

 

 

$

 

 

 

Refer to the notes to the unaudited condensed consolidated financial statements.

5


 

PARK HOTELS & RESORTS INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(unaudited, in millions)

 

 

 

 

 

 

 

 

 

 

 

 

(Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Deficit)

 

 

Non-

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Paid-in

 

 

Retained

 

 

controlling

 

 

 

 

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Earnings

 

 

Interests

 

 

Total

 

 

 

 

Balance as of December 31, 2021

 

 

236

 

 

$

2

 

 

$

4,533

 

 

$

(83

)

 

$

(49

)

 

$

4,403

 

 

 

 

Share-based compensation, net

 

 

 

 

 

 

 

 

1

 

 

 

 

 

 

 

 

 

1

 

 

 

 

Net loss

 

 

 

 

 

 

 

 

 

 

 

(57

)

 

 

1

 

 

 

(56

)

 

 

 

Dividends and dividend
    equivalents
(1)

 

 

 

 

 

 

 

 

 

 

 

(2

)

 

 

 

 

 

(2

)