FILE PHOTO: The GM logo is seen at the General Motors Lansing Grand River Assembly Plant in Lansing.
WASHINGTON (Reuters) – General Motors Co <GM> confirmed on Monday it agreed to loan $40 million to an electric vehicle start-up to facilitate the acquisition of its shuttered Lordstown Assembly plant in Ohio.
Lordstown Motors Corp, which is 10% owned by Workhorse Group Inc <WKHS>, bought the plant and equipment for $20 million in November as part of its ambitious plan to begin building electric pickup trucks by the end of 2020.
The loan agreement, which was reported earlier Monday by the Business Journal in Youngstown, was filed in Trumbull County last week.
Lordstown Motors has been working on the engineering of the new truck, “Endurance”, and hired Rich Schmidt, a former director of manufacturing at Tesla Inc, as chief production officer.
“We structured the sales agreement to help support Lordstown Motors’ launch plans for the Endurance pickup,” GM spokesman Jim Cain said, who added it “allows them to take possession of the plant and to cover some operating expenses while they undertake their capital raise.”
GM is not investing in the venture, but Cain said GM financing could rise to $50 million.
The fate of the sprawling northeastern Ohio plant became a political lightning rod after GM announced its planned closure in November 2018, drawing condemnation from U.S. President Donald Trump and many U.S. lawmakers.
Lordstown CEO Steve Burns told Reuters last month he hopes to have pre-production prototypes coming off the assembly line by April and to start production by November 2020 with an initial workforce of 400 hourly workers.
Burns said last month the company hopes to raise more than $300 million, the Business Journal reported. Burns told Reuters it retained Ohio investment bank Brown Gibbons Lang & Co in its capital fundraising effort.
GM and South Korea’s LG Chem <051910.KS> said Thursday they will invest $2.3 billion to build an electric vehicle battery cell joint venture plant in Ohio which will be one of the world’s largest battery facilities.
The plant, to be built near the Lordstown complex, will employ more than 1,100 people, the companies said.
As part of the Lordstown sale, GM has the option to lease land near the assembly plant that it could use for the battery plant.
(Reporting by David Shepardson; Editing by Sonya Hepinstall)
CHICAGO, Dec. 5, 2019 /PRNewswire/ — United Airlines (NASDAQ: UAL) today announced that Oscar Munoz, Chief Executive Officer, will transition to the role of Executive Chairman of the Board of Directors of United Airlines Holdings, Inc. in May 2020. As CEO, Munoz has transformed United’s culture and set new standards of operational and financial performance. J. Scott Kirby, President, will succeed Munoz as Chief Executive Officer.
“With United in a stronger position than ever, now is the right time to begin the process of passing the baton to a new leader,” Munoz said. “One of my goals as CEO was to put in place a successful leadership transition for United Airlines. I brought Scott to United three years ago, and I am confident that there is no one in the world better equipped to lead United to even greater heights. It has been the honor of my career to lead the 95,000 dedicated professionals who serve United’s customers every day. I look forward to continuing to work closely with Scott in the months ahead and supporting the company’s ongoing success in my new role.”
Kirby was recruited to United Airlines by Munoz in August 2016, after a three-decade career in the commercial airline business. His appointment reflects a commitment from Munoz and the Board to preserve leadership continuity and demonstrates confidence in the airline’s strategy and current trajectory.
“When I joined United as CEO, I laid out ambitious goals to build a new spirit of United by regaining the trust of our employees and customers – and I’m proud of how far we’ve come,” Munoz said. “Along with the successful implementation of the plan our team laid out in January 2018, United’s operational and financial performance isn’t just better – it’s better than ever. By instilling a culture of ‘proof not promise,’ we have transformed United even faster than we expected and there’s an incredible sense of excitement about the future.”
Kirby, a highly-regarded industry leader, has played a pivotal role in enabling United’s cultural transformation and successfully executing the company’s strategic growth plan.
“I am honored to be named the next CEO of United and to succeed Oscar, whose leadership has been truly transformational for United Airlines,” Kirby said. “I look forward to working with Oscar, the Board, our established leadership team and every United employee as we drive forward our proven strategy and focus on being the airline customers choose to fly and return to time and again.”
Munoz will serve as Executive Chairman for a one-year term and will continue to work closely with Kirby, the Board and the United team in shaping United’s employee and customer-centric culture. He will also lead the company’s Board and continue to engage on behalf of United with a range of external stakeholders.
As part of this transition, United’s current Chairman, Jane Garvey, will retire from the Board in May 2020 after more than a decade of exceptional service, including serving as Chairman since May 2018. At the request of the Board, Garvey agreed to remain in her role for a year beyond the Board’s mandatory retirement age.
“On behalf of the Board of Directors, I cannot thank Oscar enough for his outstanding leadership and commitment to United, and we are pleased that we will continue to benefit from his expertise and experience in his role as Executive Chairman,” Garvey said. “Oscar became CEO at one of the most challenging points in United’s history, and his focus on putting customers and employees first has transformed United’s culture today and successfully positioned the company for tomorrow. One of Oscar’s greatest legacies is the best-in-class leadership team he has built, and we have full confidence that Scott is the ideal candidate to lead United into the bright future that lies ahead.”
The company also announced that Ted Philip will become Lead Independent Director following the 2020 Annual Meeting of Shareholders. Philip joined the Board in July 2016 and chairs the Nominating/Governance Committee. He also currently serves on the Board of Directors of Hasbro, Inc. and BRP Inc.
“I could not be more excited about the opportunity that we have at United over the next several years to fulfill this airline’s incredible potential,” Philip said. “I am proud to work alongside Oscar in guiding United’s Board and leadership team, and I am eager to get to work on delivering for all of our stakeholders. The entire Board and I want to thank Jane for her many contributions to United over the last decade, including her highly successful tenure as Chairman.”
All of the changes announced today will take effect following the company’s Annual Meeting of Shareholders, scheduled for May 20, 2020.
Every customer. Every flight. Every day.
In 2019, United is focusing more than ever on its commitment to its customers, looking at every aspect of its business to ensure that the carrier keeps customers’ best interests at the heart of its service. In addition to today’s news, United recently announced that MileagePlus miles will now never expire, giving members a lifetime to use miles on flights and experiences. Customers now have more free on board snack options as well, with a choice of Lotus Biscoff cookies, pretzels and the Stroopwafel. The airline also recently released a re-imagined version of the most downloaded app in the airline industry, introduced ConnectionSaver – a tool dedicated to improving the experience for customers connecting from one United flight to the next – and launched PlusPoints, a new upgrade benefit for MileagePlus premier members.
Ultra-modern and high-tech manufacturing facility will be located at Toronto Pearson International Airport
Slated for completion in 2023, the one-million square-foot facility will be home to the most advanced aircraft manufacturing processes in the world
Strengthened commitment to Ontario’s aerospace industry, securing job growth and supporting economic development in the region for years to come
TORONTO, Dec. 04, 2019 (GLOBE NEWSWIRE) — Bombardier is pleased to announce that it has signed a long-term lease agreement with the Greater Toronto Airports Authority (GTAA) to build its new state-of-the art Global Manufacturing Centre located at Toronto Pearson International Airport. With preliminary site work underway in Mississauga and first production activities set to begin in 2023, the cutting-edge facility will optimize final assembly operations for all Global business jets, including the industry flagship Global 7500 business jet.
The Global Manufacturing Centre at Toronto Pearson International Airport, approximately 20 km from the current Global aircraft final assembly site at Downsview, will reinforce Canada’s leading position in the business aviation market.
“Today, I’m very excited to announce the relocation of our Global aircraft family production activities to a new, cutting-edge manufacturing facility at Toronto Pearson. This is a strategic move for Bombardier and a strong commitment to Ontario’s aerospace industry. It will allow us to offer world-class career opportunities and continue fueling the economic development of the region for years to come,” said Alain Bellemare, President and Chief Executive Officer, Bombardier Inc.
The one-million square-foot facility will combine thousands of highly-skilled employees with 21st century production and tooling innovation. Bombardier employs the highest caliber technology throughout the manufacturing process of the Global 7500 business jets, including a state-of-the-art automated positioning system that uses laser-guided measuring to ensure major aircraft structures, such as the wing and fuselage, are joined consistently and perfectly each time. Combining human ingenuity with the most advanced machines, the Global 7500final assembly line in Toronto is a testament to the industry’s most advanced business jet.
This strengthened commitment to the Greater Toronto Area will also leverage significant recent R&D investments and a continued collaboration with Ontario’s colleges and universities for world class training, research and development.
Bombardier also confirmed it will continue to support the aerospace heritage of the Downsview site with a multi-million-dollar contribution to the Downsview Aerospace Innovation and Research Consortium (DAIR) to develop a visionary aerospace hub for academic research and training activities. The contribution includes $2.5 million CAD in capital funding to refurbish the historic Moth Building, where wartime Mosquito fighter bombers and Tiger Moth trainers were produced.
CHICAGO, Dec 3 (Reuters) – United Airlines Holdings Inc announced on Tuesday an order for 50 Airbus SE A321XLR jets to fly between the U.S East Coast and Europe, becoming the latest U.S. airline to ink a deal for the European planemaker’s new passenger jet.
The long-range A321XLR jets will replace United’s 53 Boeing 757-200 planes beginning in 2024, the Chicago-based planemaker said, flying to cities like Porto, Portugal and other potential new destinations.
United’s 757 planes will reach the end of their lifespan in about a decade and Boeing Co is not building any more of the large single-aisle model.
Instead, the U.S. planemaker has been considering a new twin-aisle plane, provisionally known as the NMA, but has delayed a launch decision until 2020 while it manages the ongoing global grounding of its 737 MAX jets following two fatal crashes.
United’s chief operating officer Andrew Nocella told reporters the airline has worked closely with Boeing on the potential new aircraft and is still open to orders if the planemaker decides to move forward with developing the NMA.
Meanwhile, U.S carriers including American Airlines Group Inc, JetBlue Airways Corp and Spirit Airlines Inc have agreed orders for Airbus A320neo-family jets.
Among the benefits of the A321XLR is a 30% lower fuel burn per seat compared to previous generation aircraft, United said.
United has also ordered the larger A350 widebody jets but said it is deferring delivery of those jets until they are needed in 2027.
Its A321XLR order is the second for a U.S. carrier following tariffs that the United States is imposing on European-made aircraft.
(Reporting by Tracy Rucinski Editing by Chris Reese and Michael Perry)
PURCHASE, N.Y., Nov. 21, 2019 (GLOBE NEWSWIRE) — Atlas Air Worldwide Holdings, Inc. (AAWW) today confirmed that its subsidiaries Atlas Air, Inc. and Southern Air, Inc. have prevailed in another legal dispute with the union that represents its pilots in ongoing negotiations, the International Brotherhood of Teamsters.
The decision by the U.S. Court of Appeals for the Second Circuit affirms a March 13, 2018, decision by the Southern District Court of New York compelling the Teamsters to arbitrate whether the merger provisions in Atlas Air and Southern Air’s collective bargaining agreements apply to the bargaining process. Today’s decision, as well as two binding decisions by arbitrators rendered in favor of both Atlas Air and Southern Air this summer, have made clear that IBT must engage in the current Atlas Air and Southern Air collective bargaining agreements’ expedited and defined process for achieving a joint collective bargaining agreement.
In a separate labor-related decision rendered in July 2019, the U.S. Court of Appeals for the District of Columbia unanimously affirmed a federal district court ruling in November 2017 that ordered the union to stop an intentional and illegal work slowdown by Atlas Air pilots in violation of the Railway Labor Act. The unanimous ruling from a three-judge panel upheld the lower-court order that blocked the union from continuing to engage in improper activities such as excessive sick calls on short notice or refusing to volunteer for open time.
“With these decisions behind us, it’s time for the union to honor its obligations under the collective bargaining agreements and these binding decisions. Specifically, the union has an obligation to produce an integrated seniority list and engage in direct bargaining for a defined and limited period of time. In ongoing negotiations, the union has yet to provide us with a comprehensive economic proposal covering pay and benefits for evaluation. We remain committed to working collaboratively with union leaders to efficiently negotiate and complete the contract,” said William J. Flynn, Chairman and Chief Executive Officer, Atlas Air Worldwide.
For more information about the contract negotiations process and updates, please visit AtlasAir5YPilots.com and follow @AtlasAir5Y on Twitter.
Airline prioritises passenger experience and connectivity with fleet upgrade
Toulouse, 19 November, 2019 – World number one regional aircraft manufacturer ATR, just delivered the first of three ATR 72-600 aircraft to Tunisair Express. The Tunisian airline will use these aircraft to renew its regional fleet providing passengers with essential connectivity both domestically and internationally. The latest generation ATR 72-600 burns 40% less fuel and emits 40% less CO2 compared to a similarly sized regional jet.
By upgrading to the ATR -600 series, the airline has also chosen to prioritise the comfort of its passengers, introducing the latest generation 18” wide seats and the Cabinstream In-Flight Experience, allowing passengers to access a variety of content on their personal electronic devices.
Tunisair Express Director General, Yosr Chouari, said: “We are looking forward to introducing this new ATR aircraft with the latest comfort and technology to our passengers, with this first delivery marking an important step in our fleet renewal. Regional aviation provides essential connectivity for Tunisia and the unbeatable economics of the ATR 72-600, together with the best cabin, make it perfect for both our domestic and international operations.”
ATR Chief Executive Officer, Stefano Bortoli, commented: “As the leading regional aviation manufacturer, we understand how tough it can be for regional airlines. That is why we do everything that we can to support our clients and operators, ensuring that each innovation we introduce adds value in either the cockpit or the cabin and their bottom line. It is a clear recognition that when an airline wants to put its passengers first, the ATR is selected as the best aircraft for the job.”
ATR’s Market Forecast sees a demand for 350 new turboprops over the next 20 years for the Africa and Middle-East region. Regional aviation provides essential connectivity around the world. A 10% increase in regional flights generates additional increases of 5% in tourism, 6% in regional GDP and 8% foreign direct investment. Turboprops are key in connecting communities around the world: 36% of all commercial airports rely exclusively on turboprops and 50% rely, also exclusively, on regional aircraft.
Air Arabia, the Middle East and North Africa’s first and largest low cost carrier, has signed a firm order for 120 Airbus aircraft comprising 73 A320neo’s, 27 A321neo’s and 20 A321XLR’s. The agreement was signed at the 2019 Dubai Airshow in the presence of Air Arabia’s Chairman Sheikh Abdullah Bin Mohammed Al Thani, Adel Al Ali, Chief Executive Officer Air Arabia and Guillaume Faury, Airbus Chief Executive Officer.
Adel Al Ali, Group Chief Executive Officer of Air Arabia, said: “Air Arabia’s fleet growth strategy has always been driven by commercial demand and we are glad to announce today one of the region’s largest single-aisle orders with Airbus to support our growth plans. This new milestone underpins not only our solid financial fundamentals but also the strength of our multi-hub growth strategy that we have adopted over the years while remaining focused on efficiency, performance and passenger experience.” He added: “The addition of the A320neo, A321neo and A321XLR complements our existing fleet and allows us to expand our service to farther and newer destinations while remaining loyal to our low-cost business model. We look forward to working with Airbus and receiving the first delivery.”
Christian Scherer, Airbus Chief Commercial Officer said: “We are delighted to expand our partnership with Air Arabia, this is a great endorsement for the A320neo Family which will allow the airline to tap into new markets. We are committed to supporting the fast expansion of Air Arabia and the region”
Air Arabia is an all Airbus operator with a total fleet of 54 A320 Family aircraft including the A321LR. All aircraft will feature a comfortable single-class cabin with one of the most generous seat pitches today.
The A321XLR is the next evolutionary step from the A321LR which responds to market needs for even more range and payload, creating more value for the airlines. From 2023, it will deliver an unprecedented Xtra Long Range of up to 4,700nm – 15% more than the A321LR and with 30% lower fuel burn per seat compared with previous generation competitor aircraft.
Featuring the widest single-aisle cabin in the sky, the best-selling A320neo Family, comprising the A319neo, A320neo, and A321neo, deliver at least 20% reduced fuel burn as well as 50% less noise compared to previous generation aircraft, thanks to incorporating the very latest technologies including new generation engines and Sharklets. At the end of October 2019, the A320neo Family had received more than 7,000 firm orders from over 110 customers worldwide.
Airbus andEmirates Airline have signed a purchase agreement for 50 A350-900s – Airbus’ newest generation widebody aircraft.
The order was signed at Dubai Airshow 2019 by His Highness Sheikh Ahmed bin Saeed Al Maktoum and Guillaume Faury, Airbus Chief Executive Officer.
HH Sheikh Ahmed said: “Today, we are pleased to sign a firm order for 50 A350 XWB’s, powered by Rolls-Royce Trent XWB engines. This follows a thorough review of various aircraft options and of our own fleet plans. It is Emirates’ long-standing strategy to invest in modern and efficient aircraft, and we are confident in the performance of the A350 XWB.
“Complementing our A380’s and 777’s, the A350’s will give us added operational flexibility in terms of capacity, range and deployment. In effect, we are strengthening our business model to provide efficient and comfortable air transport services to, and through, our Dubai hub.”
Sheikh Ahmed added: “This deal reflects our confidence in the future of the UAE’s aviation sector, and is a strong affirmation of Dubai’s strategy to be a global nexus connected to cities, communities and economies via a world-class and modern aviation sector.”
“We are honoured by Emirates’ strong vote of confidence in our newest widebody aircraft, taking our partnership to the next level. The A350 will bring unbeatable economics and environmental benefits to their fleet,” said Guillaume Faury, Airbus Chief Executive Officer. “We look forward to seeing the A350 flying in Emirates colours!”
The A350 XWB offers by design unrivalled operational flexibility and efficiency for all market segments – up to ultra-long haul (17,900km). Its Airspace by Airbus cabin is the quietest of any twin-aisle aircraft and offers passengers and crews the most modern in-flight flying experience. The aircraft features the latest aerodynamic design, a carbon fibre fuselage and wings, plus new fuel-efficient Rolls-Royce Trent XWB engines. Together, these latest technologies result in 25% lower operating costs, as well as 25% reduction in fuel burn and CO2 emissions compared with previous-generation competing aircraft – demonstrating Airbus’ commitment to minimise its environmental impact while remaining at the cutting edge of air travel.
Strong Net Rooms Growth Fuels Nearly 11% Increase in Management and Franchise Fees
CHICAGO (October 30, 2019) – Hyatt Hotels Corporation (“Hyatt” or the “Company”) (NYSE: H) today reported third-quarter 2019 financial results. Net income attributable to Hyatt was $296 million, or $2.80 per diluted share, in the third quarter of 2019, compared to $237 million, or $2.09 per diluted share, in the third quarter of 2018. Adjusted net income attributable to Hyatt was $39 million, or $0.37 per diluted share, in the third quarter of 2019, compared to $37 million, or $0.33 per diluted share, in the third quarter of 2018. Refer to the table on page 14 of the schedules for a summary of special items impacting Adjusted net income and Adjusted earnings per share in the three months ended September 30, 2019.
Mark S. Hoplamazian, president and chief executive officer of Hyatt Hotels Corporation, said, “The strength of our brands and the consistent approach we have to operating with excellence and efficiency are serving us very well in this period of volatile economic conditions. In particular, our management and franchise fee growth of nearly 11% this quarter is driven by roughly 13% year-over-year net rooms growth. Further, we have successfully increased productivity and operating efficiency for 23 straight quarters which has allowed us to maintain strong hotel operating margins even in the face of flat RevPAR growth this quarter.”
Third quarter of 2019 financial highlights as compared to the third quarter of 2018 are as follows:
Net income increased 25.4% to $296 million.
Adjusted EBITDA decreased 7.3% to $163 million, a decrease of 6.5% in constant currency.
Comparable system-wide RevPAR was flat, including a decrease of 0.1% at comparable owned and leased hotels. Comparable system-wide RevPAR growth was favorably impacted by approximately 50 basis points from the timing of the Jewish holidays, but was offset by a similar reduction resulting from political unrest in Hong Kong.
Comparable U.S. hotel RevPAR decreased 0.6%; full service hotel RevPAR increased 0.2% and select service hotel RevPAR decreased 2.3%.
Net rooms growth was 13.2%, or 7.9% excluding the acquisition of Two Roads Hospitality LLC (“Two Roads”) in the fourth quarter of 2018.
Comparable owned and leased hotels operating margin decreased 20 basis points to 21.0%.
Adjusted EBITDA margin of 26.9% decreased 280 basis points in constant currency.Mr. Hoplamazian continued, “We continue to execute on our capital strategy and shift our earnings profile while maintaining our focus on global growth. We expect to end the year with approximately 57% of our earnings coming from our hotel management and franchise business, an increase of roughly 400 basis points from 2018. Our pipeline remains robust while continuing to deliver solid organic net rooms growth of almost 8% this quarter, net of the acquisition of Two Roads in the fourth quarter of 2018. While theNote: All RevPAR and ADR percentage changes are in constant dollars. This release includes references to non-GAAP financial measures. Refer to the non-GAAP reconciliations included in the schedules and the definitions of the non-GAAP measures presented beginning on page 12.
current global operating environment is challenging, we feel confident in our ability to manage through volatility and identify opportunities to strengthen our brands and performance.”
Third quarter of 2019 financial results as compared to the third quarter of 2018 are as follows:
Management, Franchise and Other Fees
Total management, franchise and other fees increased 11.9% (12.5% increase in constant currency) to $148 million. Base management fees increased 17.8% to $64 million, primarily in the Americas management and franchising segment due to the acquisition of Two Roads. Incentive management fees decreased 1.3% to $33 million. Franchise fees increased 11.8% to $37 million. Other fees increased 22.0% to $14 million. Excluding other fees, management and franchise fees increased 10.9% (11.6% increase in constant currency) to $134 million.
Americas Management and Franchising Segment
Americas management and franchising segment Adjusted EBITDA increased 11.2% (11.4% increase in constant currency), driven by higher management, franchise, and other fees from the Two Roads acquisition and recently opened hotels. RevPAR for comparable Americas full service hotels increased 1.5%, occupancy increased 70 basis points, and ADR increased 0.7%. RevPAR growth was driven by strength in certain resort locations outside of the United States and benefited from the timing of the Jewish holidays which had an approximate 110 basis point favorable impact. RevPAR for comparable Americas select service hotels decreased 2.4%, occupancy decreased 40 basis points, and ADR decreased 1.8%. Total Americas management and franchising adjusted revenues increased 29.6% (29.9% increase in constant currency) including revenue from the residential management operations acquired as part of Two Roads.
Transient rooms revenue at comparable U.S. full service hotels increased 1.0%, room nights increased 2.3%, and ADR decreased 1.3%. Group rooms revenue at comparable U.S. full service hotels decreased 0.2%, room nights decreased 2.3%, and ADR increased 2.2%.
Americas net rooms increased 11.5% compared to the third quarter of 2018, or 5.2% excluding Two Roads.
Southeast Asia, Greater China, Australia, South Korea, Japan and Micronesia (ASPAC) Management and Franchising Segment
ASPAC management and franchising segment Adjusted EBITDA increased 0.9% (2.5% increase in constant currency). RevPAR for comparable ASPAC full service hotels decreased 2.0%, reflecting weakness in Hong Kong. Excluding Hong Kong, RevPAR for comparable ASPAC full service hotels would have increased 0.8%. Occupancy decreased 50 basis points and ADR decreased 1.3% for ASPAC full service hotels. Revenue from management, franchise, and other fees increased 4.2% (5.4% increase in constant currency).
ASPAC net rooms increased 17.7% compared to the third quarter of 2018, or 13.7% excluding Two Roads.
Note: All RevPAR and ADR percentage changes are in constant dollars. This release includes references to non-GAAP financial measures. Refer to the non-GAAP reconciliations included in the schedules and the definitions of the non-GAAP measures presented beginning on page 12.
Europe, Africa, Middle East and Southwest Asia (EAME/SW Asia) Management and Franchising Segment
EAME/SW Asia management and franchising segment Adjusted EBITDA increased 4.8% (7.8% increase in constant currency). RevPAR for comparable EAME/SW Asia full service hotels increased 1.6%, driven by strong growth in certain European markets, including France and the United Kingdom, and Southwest Asia, offset partially by weaker performance in Russia which lapped the FIFA World Cup in 2018.
Occupancy increased 290 basis points and ADR decreased 2.6% for EAME/SWA full service hotels. Revenue from management, franchise, and other fees increased 2.2% (4.3% increase in constant currency).
EAME/SW Asia net rooms increased 15.6% compared to the third quarter of 2018, or 14.4% excluding Two Roads.
Owned and Leased Hotels Segment
Total owned and leased hotels segment Adjusted EBITDA decreased 17.6% (16.9% decrease in constant currency), including a decrease of 12.0% (11.4% decrease in constant currency) in pro rata share of unconsolidated hospitality ventures Adjusted EBITDA. Refer to the table on page 11 of the schedules for a detailed list of portfolio changes and the year-over-year net impact to total owned and leased hotels segment Adjusted EBITDA.
Owned and leased hotels segment revenues decreased 3.9% (3.0% decrease in constant currency), and was negatively impacted by non-comparable hotels. RevPAR for comparable owned and leased hotels decreased 0.1%. Occupancy and ADR were both flat.
Corporate and Other
Corporate and other Adjusted EBITDA decreased 22.4% (22.5% decrease in constant currency), inclusive of $6 million of expenses from the Two Roads acquisition.
Corporate and other adjusted revenues increased 19.1% (consistent in constant currency).
Selling, General, and Administrative Expenses
Selling, general, and administrative expenses increased 1.0%, inclusive of rabbi trust impact and stock- based compensation. Adjusted selling, general, and administrative expenses increased 13.8%, or $10 million, including $8 million of integration costs related to the acquisition of Two Roads. Refer to the table on page 17 of the schedules for a reconciliation of selling, general, and administrative expenses to Adjusted selling, general, and administrative expenses.
OPENINGS AND FUTURE EXPANSION
Twenty hotels (or 4,422 rooms) opened in the third quarter of 2019, contributing to a 13.2% increase in net rooms compared to the third quarter of 2018. Excluding the impact of the Two Roads acquisition, net rooms increased 7.9% compared to the third quarter of 2018.
As of September 30, 2019, the Company had executed management or franchise contracts for approximately 460 hotels, or approximately 92,000 rooms. The Company is expected to open approximately 85 hotels in the 2019 fiscal year.
Note: All RevPAR and ADR percentage changes are in constant dollars. This release includes references to non-GAAP financial measures. Refer to the non-GAAP reconciliations included in the schedules and the definitions of the non-GAAP measures presented beginning on page 12.
SHARE REPURCHASE/DIVIDEND
During the third quarter of 2019, the Company repurchased a total of 1,776,891 (1,099,507 Class A shares and 677,384 Class B shares) for approximately $133 million. The Company ended the third quarter with 36,811,374 Class A and 66,438,444 Class B shares issued and outstanding. From October 1 through October 25, 2019, the Company repurchased 523,499 shares of Class A common stock for an aggregate purchase price of approximately $37 million. As of October 25, 2019, the Company had approximately $351 million remaining under its share repurchase authorization.
The Company’s board of directors has declared a cash dividend of $0.19 per share for the fourth quarter of 2019. The dividend is payable on December 9, 2019 to Class A and Class B stockholders of record as of November 26, 2019.
CAPITAL STRATEGY UPDATE
In a Form 8-K filed on September 16, 2019, the Company announced the sale of the 1,260-room Hyatt Regency Atlanta for approximately $355 million to an unrelated third party and the entry into a long-term management agreement for the property upon sale.
The Company is in the process of pursuing the sale of one of its wholly-owned hotels and will provide further details as appropriate.
BALANCE SHEET / OTHER ITEMS As of September 30, 2019, the Company reported the following:
Total debt of $1,623 million.
Pro rata share of unconsolidated hospitality venture debt of approximately $564 million, substantially all of which is non-recourse to Hyatt and a portion of which Hyatt guarantees pursuant to separate agreements.
Cash and cash equivalents, including investments in highly-rated money market funds and similar investments, of $660 million, restricted cash of $140 million, and short-term investments of $63 million.
Undrawn borrowing availability of $1.5 billion under Hyatt’s revolving credit facility.2019 OUTLOOK The Company is revising the following expectations for the 2019 fiscal year:
Comparable system-wide RevPAR is expected to increase approximately 0.5%, as compared to fiscal year 2018.
Net income is expected to be approximately $431 million to $470 million. Please refer to the table on page 13 of the schedules for revised ranges impacting net income.
Other income (loss), net is expected to be approximately $98 million to $103 million, reflecting increased interest income and unrealized gains on marketable securities. The estimated $40 million negative impact related to performance guarantee expense for the four managed hotels in France is unchanged.
Adjusted EBITDA is expected to be approximately $730 million to $745 million, primarily reflecting a one point reduction in expected comparable system-wide RevPAR and the sale ofNote: All RevPAR and ADR percentage changes are in constant dollars. This release includes references to non-GAAP financial measures. Refer to the non-GAAP reconciliations included in the schedules and the definitions of the non-GAAP measures presented beginning on page 12.
Hyatt Regency Atlanta (as previously reported in a Form 8-K filed on September 16, 2019). Refer to the table on page 13 of the schedules for a reconciliation of Net Income to Adjusted EBITDA.
Depreciation and amortization expense is expected to be approximately $329 million to $334 million.
Interest expense is expected to be approximately $77 million.
Adjusted selling, general, and administrative expenses are expected to be approximately $335 million. This is inclusive of approximately $25 million of expenses related to non-recurring integration costs for Two Roads. Adjusted selling, general, and administrative expenses exclude approximately $33 million of stock-based compensation expense and any potential impact related to benefit programs funded through rabbi trusts.The Company is reaffirming the following information for the 2019 fiscal year:
The Company expects to grow units, on a net rooms basis, by approximately 7.25% to 7.75%, reflecting approximately 85 new hotel openings.
Capital expenditures are expected to be approximately $375 million.
As previously reported in an 8-K filed on September 16, 2019, the Company expects to return approximately $500 million to shareholders through a combination of cash dividends on its common stock and share repurchases.
The effective tax rate is expected to be approximately 25% to 27%.
No additional disposition or acquisition activity beyond what has been completed as of the date of this release has been included in the outlook. The Company’s outlook is based on a number of assumptions that are subject to change and many of which are outside the control of the Company. If actual results vary from these assumptions, the Company’s expectations may change. There can be no assurance that Hyatt will achieve these results.
Duluth, Minn. and Knoxville, Tenn. (30 October 2019) – Cirrus Aircraft, the global leader in personal aviation, ushered in a new era of innovation today with the introduction of Safe ReturnTM – a revolutionary emergency autoland system that enables passengers to land the Vision JetTM with just the touch of a single button. Once activated when available, Safe Return assumes control of the aircraft and transforms the Vision Jet into an autonomous vehicle that navigates to the nearest suitable airport for landing, communicates with air traffic control, lands and brings the aircraft safely to a complete stop. The Vision Jet, with both Safe Return and the award-winning Cirrus Airframe Parachute System® (CAPS®), provides a comprehensive, must-have total safety solution unique to G2 Vision Jet operators.
“Our mission is to make personal aviation more accessible by continuing to improve passenger comfort and safety,” said Zean Nielsen, Cirrus Aircraft Chief Executive Officer. “Safe Return delivers the next step towards autonomous flight, bringing a new level of confidence to the overall flying experience by providing the ultimate level of safety and control to passengers. Together, with the Cirrus Airframe Parachute System® (CAPS®), we have once again set a new standard for safety in personal air travel.”
Easily accessible by passengers in the Vision Jet cabin, Safe Return is activated by the touch of a button when available. Once pressed, the autonomous system analyzes terrain and datalink weather to determine the optimal airport for landing, and simultaneously begins communication with Air Traffic Control (ATC). Powered by the Perspective Touch+TM by Garmin® flight deck, Safe Return utilizes all available aircraft data streams, including available fuel, to safely navigate the Vision Jet to the identified airport and transition on to final approach for the appropriate runway based on ground winds. Autothrottle – launched earlier this year on the new G2 Vision Jet –and the automatic flight control system manage the aircraft’s speed, altitude and path, while the system automatically lowers the flaps and landing gear on final approach. Safe Return culminates in the aircraft making a fully autonomous landing on the intended runway and coming to a complete stop, allowing passengers to exit the aircraft.
Included during this entire process is constant communication with ATC – another layer of autonomy that provides assurance to passengers experiencing a critical situation. Upon activation, Safe Return immediately transmits an emergency message to ATC. Using text and speech technology, the system communicates the aircraft’s intentions over the appropriate ATC frequency, the 121.5 emergency voice frequency, and also switches to the universal emergency transponder code. ATC is automatically updated at regular intervals of the aircraft’s location, emergency situation and intended airport landing location. These communications begin the process of activating emergency services at the airport of intended landing to assist the passenger and pilot upon arrival. Safe Return can be easily disengaged by the pilot with a simple press of the Autopilot disconnect button on the yoke if a passenger inadvertently activates the system.
In 2016, Cirrus Aircraft ushered in a new era in personal transportation with the FAA certification of the world’s first single-engine Personal Jet – the Vision Jet. The turbine aircraft defined a new category in aviation – the Personal JetTM – with its spacious pilot and passenger-friendly cabin featuring panoramic windows, reclining seats, comfortable legroom for five adults and two children and the only turbine aircraft with a whole airframe parachute system as standard equipment. Earlier this year, Cirrus Aircraft unveiled and began delivery of the G2 Vision Jet, offering enhanced performance, comfort and safety with increased cruise altitude, speed and range, and a newly-upgraded Perspective Touch+TM by Garmin® flight deck. The company expects to begin delivery of Vision Jets equipped with Safe Return in early 2020.
