Hyatt Hotels Corp. said second-quarter RevPAR declined 89.4%, citing an "uneven recovery" hampered by Covid-19's continued surge and widespread travel and quarantine restrictions.
"Leisure demand was the principal driver of 13 weeks of increases in occupancy and net bookings across the globe; however, the rate of growth in demand moderated in the middle of July, due to rising case counts in certain areas and cross-border travel restrictions that remain in place across the world," said Hyatt CEO Mark Hoplamazian during the company's Q2 earnings call Tuesday.
"We've seen increased momentum in the latter half of July, but until meaningful and consistent progress is made toward slowing the spread of the virus, international travel will continue to be negatively impacted."
Hyatt reported that around 80% of the group's global portfolio was open as of the end of June, which grew to around 87% by the end of July. That compares to a low of approximately 65% of total hotels open as of April 30.
In the U.S., Covid-19 outbreaks in some states weighed down Hyatt's second-quarter performance. Additionally, booking windows in the market have shrunk, with more than 65% of Hyatt's full-service U.S. bookings and more than 75% of the group's select-service U.S. bookings being made just four days ahead of the date of stay.
"The [negative] impacts with respect to growth rate were pronounced in markets where you had surges of Covid-19 cases," said Hoplamazian. "Other than Arizona, those rates of progression have largely returned, but it's logical to expect that surges in caseloads will have an impact. And given the [short] booking windows, the impact is instantaneous."
Hyatt did, however, report encouraging green shoots in China, where RevPAR trends have steadily improved since May. Excluding Hong Kong, Macau and Taiwan, preliminary estimates indicate occupancy in China reached approximately 65% at the end of July.
According to Hoplamazian, some of that relatively high occupancy rate has been bolstered by midweek business travel, with the business transient category now accounting for an estimated quarter of total demand in China.
China represents around 5% of Hyatt's business on an earnings basis.
Other bright spots include Hyatt's select-service brands, which are outperforming the company's full-service flags, as well as some of the company's resort properties, with those benefiting from solid drive-to demand "doing really well."
For the second quarter, Hyatt reported total revenues of $250 million, compared to $1.29 billion for the same period last year. The company recorded a net loss of $236 million for the quarter, down from last year's second-quarter net income of $86 million.