Q3 2026 Ryman Hospitality Properties Inc Earnings Conference Call - RYMAN HOSPITALITY PROPERTIES INC

Financial Performance:

• Third quarter consolidated revenue and adjusted EBITDA RE set new records, driven by strong same-store hospitality performance.
• Same-store hospitality portfolio achieved 7.9% growth in RevPAR and 8% growth in Total RevPAR, outperforming expectations by ~400 basis points.
• Same-store adjusted EBITDA RE improved 12% year-over-year, exceeding guidance by approximately $7 million.
• Group business saw 3.5% ADR growth (200+ bps better than expected) and 14% increase in banquet/AV revenues driven by higher catering spend per attendee.
• Leisure demand exceeded expectations at Gaylord National (driven by 4th of July/America 250) and Gaylord Texan (post-renovation).
• Entertainment segment generated record Q3 revenue (+1.5%) and $23.8 million adjusted EBITDA RE, though profitability was negatively impacted by General Jackson Showboat maintenance disruptions.
• Liquidity position remains strong with nearly $1.3 billion in total available liquidity; proforma net leverage ratio stands at 4.4x assuming 4-year contribution from Grand Lakes.
• Capital expenditure guidance narrowed to $450–$500 million for 2026, reflecting increased visibility on project timing.

Guidance and Future Outlook:

• Raised midpoints for same-store hospitality Q4 guidance based on Q3 beat and modestly increased leisure demand expectations (low single-digit growth).
• Lowered consolidated adjusted EBITDA RE guidance midpoint by $3 million for the full year 2026 to account for General Jackson Showboat wind-down costs and YTD profitability impacts.
• Projected near-10% growth in AFFO per share at the midpoint, factoring in limited contribution from new acquisitions and equity dilution.
• Confident in meeting or exceeding 2027 financial objectives for adjusted EBITDA RE and AFFO per share as previously outlined at the 2024 Investor Day.
• 2027 group room revenue pace on books is up 4.5% year-over-year with ADR pacing in the mid-single digit range.
• Expect 2027 capital disruption to be lower than 2026, with major projects (JW Hill Country room renovations) completing in Q1 and Opryland meeting space opening mid-year.

Business Segments and Product Lines:

• Hospitality: Focus on "all-under-one-roof" premium group strategy continues to drive incremental on-property revenue; Grand Lakes Orlando acquisition (closed Sept 1) adds a Ritz-Carlton/JW Marriott asset to the portfolio.
• Entertainment: Opry Entertainment Group (OEG) showing top and bottom-line growth; opened second Category 10 location in Las Vegas with record foot traffic and spending; new units in Orlando and India scheduled for early 2028.
• Acquisitions: Integration of JW Desert Ridge and Grand Lakes Orlando is on track; initial synergies being realized through customer rotation and operational efficiencies.
• Asset Retirement: Decision made to retire the General Jackson Showboat after 40+ years due to increasing maintenance costs and operational disruptions; wind-down costs factored into 2026 guidance.
• Strategic Restructuring: Board continues to evaluate potential investment in OEG to increase its independence; no definitive agreements reached as of Q3.

Market and Competitive Landscape:

• Underlying group demand remains healthy with no new meaningful supply expected in the near term; strong pipeline activity for 2027 and 2028.
• Premium group strategy successfully attracting higher-rated customers with greater spending potential; SMRF (Social, Military, Education, Religious, Fraternal) groups showed 26% ADR growth, booking at $316/night.
• Fintech sector identified as a key growth area for group bookings; sales team successfully filling "back-half" arrival patterns (Wed/Thu) previously considered harder to book.
• Orlando remains the #1 meetings market; Grand Lakes acquisition addresses underrepresentation in this top market and complements the existing Gaylord Palms footprint.
• Competitive advantage leveraged through extensive capital investments that have shifted meeting planner perception of legacy assets (e.g., Opryland revenue growing from $350M/$100M EBITDA a decade ago to $500M/$200M today).

Risks and Challenges:

• General Jackson Showboat maintenance issues created operational disruptions and financial headwinds, leading to the retirement decision and guidance reduction.
• Ritz-Carlton brand integration presents margin challenges; historically lower EBITDA margins compared to Gaylord properties require careful operational management to preserve profitability while honoring brand standards.
• Capital projects (Hill Country, Opryland expansion) carry execution risks and temporary disruption to profitability, though 2027 disruption is expected to be lower than 2026.
• Macroeconomic uncertainty remains a factor for long-term group spending, though current booking trends and attrition/cancellation collections indicate resilience.

Management Commentary and Tone:

• Management expressed high confidence and pride in the "standout" Q3 performance, describing the strategy as "paying off" with record metrics across the board.
• Colin Reed (Executive Chairman) highlighted strong shareholder value creation via AFFO per share growth and expressed that "the best times are ahead."
• Mark Fioravanti (CEO) emphasized the strength of the "all-under-one-roof" model and the success of the premium group rotation strategy.
• Patrick Chaffin (COO) and Mark Fioravanti noted strong alignment with Marriott management regarding technology, productivity, and procurement savings (e.g., Pepsi to Coca-Cola switch).
• Tone regarding OEG IPO/investment remains cautious but positive, with a focus on preserving legacy while enabling growth.

Analyst Questions and Answers:

• 2027 Returns & CapEx: Management confirmed room renovations (Texan, Hill Country) and Opryland meeting space will drive 2027 growth, with ADR lifts already visible in booking pace.
• ADR Trends: Explained Q3 ADR of $293 vs. Q2 $310 was due to a strategic shift in filling tougher "back-half" arrival patterns (Wed/Thu) rather than decelerating demand; overall business health is strong.
• Ritz-Carlton Synergies: Discussed learning opportunities on margins and the potential for cross-property booking where meeting planners split large groups between Gaylord Palms and Grand Lakes (9 miles apart), with minimal overlap in current bookings (<17%).
• Marriott Fee Relief: Procurement and food & beverage rebates are the primary upside; full impact assessment pending year-end rebates and cycle completion, expected to be detailed in Q4 results.
• Long-term Margin Growth: Management views margin expansion as driven by value perception from CapEx investments rather than just rate hikes; no new casino competition exists.
• Future Acquisitions: Company is in a "digestion phase" post-acquisitions; prioritizing high-return internal CapEx (Rockies expansion, Opryland expansion) over external M&A, though Orlando's unique lack of land supply made Grand Lakes a strategic necessity.
• Customer Trends: Length of stay remains consistent; Fintech sector is a specific focus for growth.

Other Key Points:

• Issued $700 million in senior unsecured notes and ~5.865 million shares to fund the Grand Lakes acquisition, with both offerings significantly oversubscribed.
• Intent remains to distribute 100% of taxable income through dividends over time.
• Tariff IPO rights for OEG remain unexercisable for four years.
• 2027 CapEx disruption expected to be lower than 2026, supporting the outlook for strong profitability.