London, UK – Last Thursday, 2 September 2021 saw an important debut for London City Airport. At 5:45 pm, an Embraer E190-E2 made its first commercial flight into the iconic airport in the centre of the British political and financial capital. Registered HB-AZG, the Helvetic Airways aircraft flew from Zurich to London in 1 hour 20 minutes, also reestablishing an essential link for the global financial community.
Flight LX 456, operated by Helvetic Airways on behalf of its partner company Swiss International Air Lines, was welcomed by a water salute from London City Airport’s fire service. On board the sold out flight were 110 passengers, including representatives of the international media, business travellers, as well as those visiting friends and family.
It should be noted that Embraer aircraft account for nearly 90% of all movements at the airport. At the same time, the E190-E2 nearly doubles the available range from LCY to more than 4,000 km, for the first time bringing destinations such as Istanbul, Casablanca and Moscow within reach.
With the coronavirus pandemic bringing a more regional emphasis to air transport along with a trend towards the use of smaller aircraft types, Helvetic Airways is now ideally equipped both to provide reliable and cost-effective flight operations and to take full and fruitful advantage of the new opportunities currently offered in markets worldwide. With a fleet of 12 Embraer E2 aircraft, Helvetic Airways is currently the largest Embraer E-Jets operator in the world, strengthening its position as a regional airline based in Switzerland, Europe and beyond.
SBB and ÖBB are stepping up their long-standing cooperation in international passenger services. The two railway companies are seeking to scale up the existing night train services from six to ten lines. Planning is underway for new night trains from Switzerland to Amsterdam, Rome and Barcelona. Last week, SBB and ÖBB signed a corresponding Letter of Intent. The planned expansion of services can only be guaranteed with financial support from the Swiss climate fund.
Demand for international night train services significantly increased in 2019 and at the start of 2020 until the coronavirus crisis struck. The number of passengers using night train services from Switzerland grew by over 25 per cent with respect to the previous year. The two partner railways consider this a sustainable trend given the significant rise in customer demand for environmentally friendly and resource-efficient travel. There is clear evidence to show that night trains have a positive effect on overall emissions, as they generate modal shift from other modes of transport to rail. ÖBB and SBB share the goal of shifting more travel to rail and thus contributing to a reduction in CO2 emissions from the travel sector. This commitment reflects the aims of the Paris Agreement on climate change and the political and public will to develop an attractive night train network as an important component of environmentally friendly and sustainable mobility in Europe.
With its 19 Nightjet lines and eight further services provided in cooperation with partner railways, ÖBB already runs Europe’s largest night train network. This includes the network from Switzerland run in cooperation with SBB, comprising six lines and one additional service. SBB and ÖBB want to build on this success and expand night train services in Europe together. Over the last few months, the companies have thoroughly tested and evaluated various options for expanding the service. By cooperating, the railway companies will be able to make use of synergies in production and marketing of the service offer and save on costs. In the Letter of Intent signed last week, the two railway companies presented their strategy for expanding services as outlined in “2024 Nightjet Network for Switzerland”. The plans involve expanding the Nightjet network from Switzerland to incorporate a total of ten lines and 25 destinations.
Cornerstones of the expansion plan:
– From 2022 timetable onwards: new Nightjet connection to Amsterdam. As a first step in the expansion process, the two railway companies want to launch a new daily Nightjet service running Zurich–Basel–Frankfurt–Cologne–Amsterdam in December 2021. However, the very limited availability of rolling stock suitable for night train services restricts short-term service expansion. SBB therefore intends to lease suitable rolling stock from German leasing company RDC Asset GmbH.
– Increasing capacity on services to Berlin, Hamburg and Prague and new connection to Leipzig and Dresden. The services currently provided from Zurich via Basel to Berlin and Hamburg are increasingly popular. Capacity on this route will therefore be expanded significantly. SBB and ÖBB wish to serve both destinations with two separate trains covering the whole route, if possible from the 2023 timetable change. This will enable a significant capacity increase. They also plan to run the service to Prague via Germany as a portion of the Berlin Nightjet with sleeping cars and couchettes. The new route would also provide a direct connection to Leipzig and Dresden.
– Plans for new connections to Rome and Barcelona. There are plans for a new line connecting Zurich via Bern, Brig, Domodossola to Rome. A daily connection from Zurich via Bern, Lausanne, Geneva to Barcelona is also planned. This would also integrate French-speaking Switzerland directly into the night train network. It is not yet clear whether it will be possible to run these two lines, as agreements with other partner railways are yet to be reached.
To ensure that night train services can be expanded in the medium to long term, ÖBB is also investing in new rolling stock. The new night train sets are to come into service gradually over a period of time.
SBB and ÖBB are campaigning for greater political support for night trains.
Alongside the planned service expansion, SBB, ÖBB and other partner railways are campaigning for transport policies which facilitate night train operations in Europe. In Switzerland, the total revision of the CO2 Act after 2020 is being debated in the autumn session of the Federal Parliament. The Act provides for support for cross-border rail services from the climate fund. Last week, the Swiss Parliament voted in favour of supporting international passenger services, including night trains. While subject to a final vote and a possible referendum, financial support from the climate fund would compensate for the losses SBB would sustain given the high operating costs night train services involve.
ÖBB is the largest provider of night train services in Europe and has contributed significantly to maintaining night trains services from Switzerland in its existing partnership with SBB. Andreas Matthä, ÖBB CEO, said: “We have no doubts about the Nightjet’s success. With SBB as a committed and effective partner, we can continue to expand the Nightjet network even further. We are investing in new trains: 13 latest generation Nightjet sets will be in operation from the end of 2022. With additional services and modern rolling stock, taking the night train will become an even more attractive option.”
SBB CEO Vincent Ducrot has no doubt that demand for fast daytime services and night trains will continue to grow. “This is a sustainable trend and the demand for environmentally friendly and resource-efficient mobility will continue to increase.”
SBB and ÖBB consider night train services as an important element of the overall service offer and see great potential for creating synergies with daytime services. An attractive rail offer helps to achieve the goal of modal shift from short-haul flights to rail.
We thank the Administration, especially the President and Secretary Mnuchin, as well as the Senate for working together to take swift bipartisan action to support the American economy, including the 2.5 million jobs and 17,000 suppliers that Boeing, the aerospace industry and the U.S. rely on to maintain our world leadership in commercial, defense and services. The bill’s access to public and private liquidity, including loans and loan guarantees, is critical for airlines, airports, suppliers, and manufacturers to bridge to recovery.
Boeing’s top priority is to protect our workforce and support our extensive supply chain, and the CARES Act will help provide adequate measures to help address the pandemic. We have also taken a number of measures for affordability and liquidity as we navigate the challenges our industry currently faces, including forgoing pay for our CEO and board chairman, suspending our dividend until further notice, and extending our existing pause of any share repurchasing until further notice.
We appreciate the House taking swift action to support the American people.
SWISS took delivery today of the first of 25 new aircraft of the Airbus A320neo family. The new arrival was formally welcomed to the fleet and named “Engelberg” in a ceremony at Zurich Airport. In acquiring these advanced and efficient short- and medium-haul aircraft, SWISS is further underlining its commitment to resource-friendly aviation. With its innovative engine technologies, the Airbus A320neo consumes some 20 per cent less fuel than comparable aircraft of the older generation. SWISS’s new Airbus A320neo also features a newly developed seat that tangibly enhances its passengers’ travel comfort.
The first Airbus A320neo of Swiss International Air Lines (SWISS) landed in Zurich at 10:57 today. The aircraft, which bears the registration HB-JDA, arrived directly from Airbus’s Hamburg-Finkenwerder works airport in northern Germany. SWISS will be receiving a total of 25 new aircraft of the Airbus A320neo family (the “neo” stands for “New Engine Option”) between now and the end of 2024: seventeen A320neos and eight of the larger A321neo version. The new twinjets will replace older Airbus A320 family aircraft in the SWISS fleet’s ranks and, with their innovative powerplant technology, will help substantially further enhance SWISS’s environmental efficiency.
After arriving in Zurich, the latest member of the SWISS aircraft fleet was formally welcomed in the hangar area by a delegation of invitees from the political, business and media worlds, and was also named “Engelberg”. The naming was jointly performed by Alex Höchli, the mayor of the Central Swiss mountain resort, and Brother Meinrad Haberl of Engelberg Monastery.
Lower fuel consumption and lower noise emissions
Thanks to the advanced technology of its Pratt & Whitney engines and its aerodynamic “sharklet” wingtip extensions, the Airbus A320neo consumes up to 20 per cent less fuel than comparable aircraft types. The new twinjets are also equipped as standard with noise-reducing vortex generators. As a result, a departing Airbus A320neo has a noise footprint on takeoff which is around half the size of the footprint produced by a comparable aircraft type.
“Our new Airbus A320neo family aircraft will substantially further reduce the average age of the SWISS aircraft fleet,” says SWISS CEO Thomas Klühr. “Once they are all delivered, our aircraft’s average age will be one of the youngest in Europe at around nine years. These billion-franc investments will further enhance our environmental credentials, too,” Klühr continues, “because operating an advanced and fuel-efficient aircraft fleet is one of the most effective means of all of reducing the ecological impact of aviation activities.”
An innovative seat for greater travel comfort
The new SWISS Airbus A320neo also offers substantially more travel comfort to both Business and Economy Class passengers, thanks to its newly-developed seats from Italian manufacturer Geven. With their ergonomic pressure distribution over the backrest and the seat cushion, the new seats deliver a tangibly pleasanter sitting experience. And the innovative horizontal placement of the literature pocket above the seat table also provides more personal space.
It’s not just aloft, either, that passengers will enjoy an even more comfortable flight: the new seats can be reclined to 20 degrees (instead of the previous 12) during the taxi, takeoff and landing phases. And Business Class travellers can even recline their seat to a full 26 degrees during the cruise phase of flight.
SWISS will be deploying its Airbus A320neos on its short- and medium-haul routes of up to 4,200 kilometres within Europe and to and from destinations in North Africa and the Middle East. The Airbus A320neo accommodates 180 passengers in Business and Economy Class.
Akio Toyoda, president of Toyota Motor Corporation, speaks at a news conference, where he announced Toyota’s plans to build a prototype city of the future on a 175-acre site at the base of Mt. Fuji in Japan, during the 2020 CES in Las Vegas
LAS VEGAS (Reuters) – Toyota Motor Corp <TM> said on Monday it plans to build a prototype “city of the future” at the base of Japan’s Mt. Fuji, powered by hydrogen fuel cells and functioning as a laboratory for autonomous cars, “smart homes,” artificial intelligence and other technologies.
Toyota unveiled the plan at CES, the big technology industry show. The development, to be built at the site of a factory that is planned to be closed, will be called “Woven City” – a reference to Toyota’s start as a loom manufacturing company – and will serve as a home to full-time residents and researchers.
Toyota did not disclose costs for the project.
Executives at many major automakers have talked about how cities of the future could be designed to cut climate-changing emissions from vehicles and buildings, reduce congestion and apply internet technology to everyday life. But Toyota’s plan to build a futuristic community on 175 acres (71 hectares)near Mt. Fuji is a big step beyond what rivals have proposed.
The proposal highlights not only Toyota Chief Executive Akio Toyoda’s ambition, but also the financial and political resources Toyota can bring to bear, especially in its home country.
Toyota expects 2,000 people will live at the city initially, with construction slated to start next year. Toyoda called the project “my personal ‘field of dreams.’
“You know if you build it, they will come.”
Toyota said it has commissioned Danish architect Bjarke Ingels to design the community. Ingels’ firm designed the 2 World Trade Center building in New York and Google’s offices in Silicon Valley and London.
Toyota said it is open to partnerships with other companies that want to use the project as a testing ground for technology.
(Reporting by Jane Lanhee Lee and David Shepardson; Writing by Joe White; Editing by Dan Grebler)
Watch the 30 second Woven City YouTube video by clicking HERE!
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)
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.
(Reuters) – Fiat Chrysler and Peugeot owner PSA are in talks to combine in a deal that could create a $50 billion (£38.88 billion) automaker, a source familiar with the matter said on Tuesday.
Fiat Chrysler shares rose sharply after news of the talks and ended up more than 7.5% in U.S. trading. The companies and the French government had no comment.
The Wall Street Journal first reported the discussions. PSA’s supervisory board was due to meet on Wednesday to discuss the potential merger, another source close to the matter said.
If a combination of Peugeot and Fiat Chrysler succeeded in overcoming political, financial and governance hurdles, the new enterprise would still face substantial challenges. Global automakers face the prospect of a slowdown in global demand coinciding with the most dramatic technology changes in a century.
Peugeot Chief Executive Carlos Tavares has predicted “ten years of chaos” for global automakers as regulators demand a switch to electric vehicles to reduce emissions linked to climate change.
Investors have speculated for several years that Fiat Chrysler was hunting for a merger partner, encouraged by the rhetoric of the company’s late chief executive, Sergio Marchionne.
In 2015, Marchionne outlined the case for consolidation of the auto industry and tried unsuccessfully to interest General Motors Co in a deal. Fiat Chrysler earlier this year broached a merger with French automaker Renault SA that ultimately collapsed.
Created when Fiat, under Marchionne’s leadership, bought control of Chrysler out of a U.S. government-backed bankruptcy in 2009, Fiat Chrysler has one of the global auto industry’s most profitable franchises in the Jeep sport utility vehicle brand and a money-spinning North American pickup and commercial van operation in Ram. Both would boost Peugeot, which does not sell vehicles in the U.S. market.
Peugeot and Fiat Chrysler could over time share engines and vehicle architectures, reducing capital spending and freeing up cash to invest in electric vehicles and emissions reduction technology required in Europe, China and other global markets.
Fiat Chrysler is under increasing pressure to invest in clean car technology. The company disclosed earlier this month that it faces a $79 million fine for falling short of U.S. fuel efficiency standards. Fiat Chrysler agreed to pay U.S. electric car maker Tesla Inc for credits to help it comply with European emissions standards until 2022.
Evercore analyst Arndt Ellinghorst in a note on Tuesday said a combination of Fiat Chrysler and Peugeot “should ignite more rational industry behavior around allocation of capital and this particular merger makes materially more sense than a potential FCA-Renault merger.”
Peugeot and Fiat Chrysler had discussed a combination earlier this year, before Fiat Chrysler proposed a $35 billion merger with Renault. At that time, Fiat Chrysler said a deal with Renault offered more advantages than a combination with Peugeot.
Fiat Chrysler Chairman John Elkann broke off talks with Renault in June after French government officials intervened and pushed for Renault first to resolve tensions with its Japanese alliance partner, Nissan Motor Co.
Following the collapse of the Renault merger plan, Fiat Chrysler CEO Mike Manley left the door open for talks with would-be partners. But he said the Italian-American automaker could go it alone despite mounting costs to develop electric vehicles and comply with tougher emissions rules in Europe, the United States and China.
Along with Jeep and Ram would come Fiat’s Italian operations, which have struggled in recent years. Fiat’s Mirafiori assembly complex in its home city of Turin has run below 50% capacity, with thousands of workers on temporary layoffs.
Overall, Fiat has 58,000 workers in Italy, where the government has long resisted mass lay-offs by large employers.
Peugeot’s Tavares dismissed the idea of a combination with Fiat Chrysler during a discussion with reporters at the Frankfurt auto show last month. “We don’t need it,” he said when asked whether he was still interested in a deal with Fiat Chrysler.
Tavares has moved aggressively to expand Peugeot, acquiring German auto brand Opel from General Motors Co for $2.6 billion in 2017. Since then, he has overseen a turnaround at Opel.
Fiat Chrysler already has a commercial vehicle partnership with Peugeot.
(Reporting by Dominic Roshan K.L. in Bengaluru; Editing by Maju Samuel, Richard Chang and Dan Grebler)
RIO DE JANEIRO (Reuters) – A left-wing political party on Wednesday filed a lawsuit to block the sale of 80% of Brazilian planemaker Embraer SA’s <ERJ> commercial jet division to Boeing Co <BA> for $4.2 billion (3.3 billion pounds), arguing it will harm Brazil’s sovereignty.
The deal, which would position Boeing to compete more directly with Airbus SE <EADSY> in the market for mid-sized passenger planes, has faced significant left-wing opposition largely because Embraer is seen as a strategic company for Brazil’s national security.
So far, a handful of lower court decisions temporarily blocking the deal have been overturned by appeals court judges. The government has authorized the deal and Embraer’s shareholders are all for it.
But the latest lawsuit, filed by Brazil’s Democratic Labor Party (PDT), underscores that there is still a political risk that could potentially unravel the agreements reached so far between Boeing and Embraer. The PDT’s leader, Ciro Gomes, has staunchly opposed the sale of Embraer’s commercial jet division to Boeing.
Embraer declined to comment on the lawsuit.
The proposed deal with Boeing was first announced in July 2018.
Boeing and Embraer are waiting for antitrust approval to finalise the deal, including intense scrutiny from European regulators. They expect that to happen in early 2020.
(Reporting by Rodrigo Viga Gaier in Rio de Janeiro; Editing by Matthew Lewis)
HONG KONG (Reuters) – Shares in Cathay Pacific Airways Ltd fell nearly 4% in early trade on Thursday following the resignation of its chairman after the market closed on the previous day.
The departure of John Slosar was announced less than three weeks after mounting Chinese regulatory scrutiny led to the shock exit of its chief executive, Rupert Hogg.
Cathay shares had closed 7.2% higher on Wednesday as the Hong Kong market was lifted by reports of the withdrawal of a controversial extradition bill, which was officially announced after the market closed.
Long-serving Swire Pacific Ltd executive Patrick Healy was appointed as Cathay’s new chairman on Wednesday following the resignation of Slosar, who had served in the role since 2014.
“As John would have retired soon anyway it’s not really a huge setback as a business,” an analyst said of Slosar’s departure. “However it’s always awful to see when politics dictate like this.”
The analyst, who was not authorised to speak publicly about personnel changes, said he believed if the political situation in Hong Kong stabilised, the situation at Cathay should as well.
Daiwa Capital Markets analyst Kelvin Lau said the extradition bill’s withdrawal was positive for Cathay, even though protests were not expected to end immediately.
“We expect this to be a turning point where the situation would at least not worsen,” he said in a note to clients, adding that recent personnel changes at the airline should satisfy the requirements of the Chinese regulator and were likely to instill confidence among customers.
China’s aviation regulator last month said crew who engaged in the anti-government protests in Hong Kong posed a threat to safety and should be suspended from staffing flights to the mainland and over its airspace.
(Reporting by Donny Kwok and Jamie Freed, writing by Jamie Freed, editing by Richard Pullin)
