Ryman Hospitality Properties, the former Gaylord Entertainment, reported a third-quarter loss of $26.7 million, which included more than $50 million in costs associated with its pending conversion to a real estate investment trust.
The quarter also was marred by a drop in sales due to the disruption caused by the company's sale to Marriott International of the Gaylord Hotels brand and management rights. But Chairman, President and CEO Colin Reed said those issues — which caused revenues to grow only slightly to $228 million from a year ago — appear to have passed.
"Against the backdrop of the enormous change that took place across the entire company, we are pleased with how our business performed this quarter," Reed said in the company's earnings statement. "We delivered an improved profitability performance at our properties, with a hospitality segment CCF margin increase of 100 basis points compared to the third quarter last year."
Gross room night bookings during the quarter totaled 338,000, a drop of 22 percent from last year. Reed said on his team's conference call that the Marriott announcement in late May caused "a lot of squirreliness" among the company's workers.
"We are confident that with the transaction behind us, the bookings performance should improve," Reed said. "In fact, during the month of October, group sales leads and tentative bookings for our hospitality segment each increased by over 20 percent, a solid indicator that the bookings pipeline is filling again and sales activity is increasing."
Reed and CFO Mark Fioravanti also said that Superstorm Sandy has led to the cancellation of 14,000 room nights at Ryman's Washington-area and Florida resorts — the latter had been set to host a group that was stranded in the D.C. area — that will cost it about $3 million in consolidated cash flow this quarter.
Investors reacted to the Q3 numbers and conference call comments by pushing down Ryman shares (Ticker: RHP) more than 2 percent to about $37.90. Since Gaylord converted to Ryman on Oct. 1, the stock is down about 5 percent.