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Where Are We Today

The Hotel Business Model Today Michael Dominguez Senior Vice President, Sales MGM Resorts International. Where Are We Today. Demand is Back. Revpar Back To 2007 Levels. Group Still Catching Up. What Demand Looks Like. Record Nights. Days Of The Week. What Days Are Driving ADR.

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Where Are We Today

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  1. The Hotel Business Model TodayMichael DominguezSenior Vice President, SalesMGM Resorts International

  2. Where Are We Today

  3. Demand is Back

  4. Revpar Back To 2007 Levels

  5. Group Still Catching Up

  6. What Demand Looks Like

  7. Record Nights

  8. Days Of The Week

  9. What Days Are Driving ADR

  10. Non Group Leads

  11. But…At A Value

  12. ADR Growth In Group Hotels

  13. Transient Premium Returns

  14. 2014 Forecast By Scale

  15. Industry Takeaways • Supply Growth – Very Slow • Demand Growth – Healthy – Despite Everything • ADR – Will Drive Revpar Recovery • Steady As She Goes

  16. Economic Headwinds

  17. Employment A Continued Drag

  18. Fuel Cost Impacts Meetings

  19. 5 Year Crude Oil Peaked at $222 – March 2012 45% Increase

  20. Airlines Still Front And Center

  21. LET’S MAKE A DEAL

  22. Washington Focus

  23. Corporations Remain Strong

  24. How Is A Hotel Built?

  25. Direct Cost • Rooms – 75% Lost Profit Figure • F&B – Highest Direct Cost Center • Other – Smallest Profitability

  26. Commodity Pricing

  27. Beef Prices 53% Increase

  28. Poultry Price 20% Increase

  29. Salmon Price 50% Increase

  30. Shrimp Price 82% Increase

  31. Coffee 5 Year - Price Peaked at $302

  32. Coffee 10 Year - Price 106% Increase

  33. Price Of Cotton

  34. Cotton Prices 43% Increase

  35. Income Before Debt

  36. Debt Expenses

  37. Elevate The Dialogue

  38. Revenue Per Occupied Group Room 200 Total Room Nights $20,000 Food & Beverage Spend

  39. Revenue Per Occupied Group Room Hotels Expected F&B Contribution Per Group Room Night $150 Your Expected F&B Contribution Per Group Room Night $100 You have less leverage with rate and concessions

  40. Revenue Per Occupied Group Room Hotels Expected F&B Contribution Per Group Room Night $150 Your Expected F&B Contribution Per Group Room Night $200 You have a ton of leverage with rate and concessions

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