La Quinta Holdings CEO Keith Cline said customers choosing same-day bookings has pushed its direct-booking numbers through proprietary channels.
IRVING, Texas—Online travel agencies might make up 20% of La Quinta Holdings’ bookings, but the company is still seeing a good number of direct bookings through proprietary channels.
During La Quinta’s third-quarter earnings call, President and CEO Keith Cline said a decent number of same-day bookings contributed to the percentage of customers booking direct through proprietary channels.
EVP and CFO Jim Forson, though, said the company’s mix of OTA business has risen with the addition of Booking.com to its distribution channel mix.
“Year to date, our mix of OTA business is just under 20% of our bookings,” he said. “The (global distribution system) is under 5%, and the rest of it is all through our proprietary channels, either property direct, LQ.com and mobile or the call center.”
Forson added the company has a tight booking window, with 35% to 40% of rooms being booked same day.
“Of that group, about three-quarters of them are showing up at the property or are calling the property and (transferring it) to the call center,” he said.
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Updated guidance, franchising
La Quinta revised its full-year guidance for 2016, which reflects Q3 performance and “the impact of changes in the timing of owned assets leaving the system,” the company’s earnings release stated.
The company lowered its full-year guidance on franchised hotel openings from 55 to 60 down to 45 to 50. Prior guidance stated expected adjusted earnings before interest, taxes, depreciation and amortization to range from $361 million to $371 million, but the company has since lowered its guidance and anticipates adjusted EBITDA will range from $354 million to $360 million.
In Q3 2016, La Quinta opened 15 franchised hotels with 1,300 rooms, which included the company’s first property in Colombia. The company now has a pipeline total of 239 franchised properties with 21,800 rooms, located in the U.S., Mexico, Colombia, Nicaragua, Guatemala, Chile and El Salvador.
Sale of 24 hotels
La Quinta said it was still on course to sell the 24 owned hotels it announced in Q3 2015 were in definitive purchase and sale agreements. So far, 21 have exited its system, with the remaining three anticipated to close soon.
As of press time, La Quinta’s stocks were down 25.4% year to date. The Baird/STR Hotel Stock Index was down 0.6% for the same time period.