Wednesday, December 2, 2009

“Investors Losing Patience As Upscale Casual Dining Restaurants Show ... - The Wall Street Transcript (blog)” plus 2 more

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“Investors Losing Patience As Upscale Casual Dining Restaurants Show ... - The Wall Street Transcript (blog)” plus 2 more

Investors Losing Patience As Upscale Casual Dining Restaurants Show ... - The Wall Street Transcript (blog)

Posted: 02 Dec 2009 11:50 AM PST

December 2, 2009 - The Wall Street Transcript has just published Travel and Leisure--Airlines, Hotels, Resorts, Cruise Lines, and Restaurants Report offering a timely review of the Leisure sector. This Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.

View Details of This Special Report

Recent Wall Street Transcript Special Reports.

SHARON ZACKFIA, Principal, CFA, joined the equity research department of William Blair & Company in 2000. She focuses on the restaurant, leisure and apparel industries. Previously, Ms. Zackfia worked in research at Credit Suisse First Boston and with the Nasdaq Stock Market and Jennison Associates. She received a B.A. from Yale University.

TWST: Where are you currently focusing your attention in the restaurant space?

Ms. Zackfia: Where I'm most positively inclined is the upscale-casual dining space and/or fast casual.

TWST: What is it about those two at this point?

Ms. Zackfia: Fast casual has actually shown improving traffic trends since April. In fact, the September quarter was the first quarter in which fast-causal comps eclipsed fast-food comps as the strongest category. I think you've seen the upper-middle-class consumer start to strengthen markedly, which really benefits fast casual.

On the other hand, upscale casual dining - and by that I mean The Cheesecake Factories (CAKE) or P.F. Chang's (PFCB) - haven't necessarily shown as much traction in same-store sales trends, and I think investors have somewhat lost some patience with those names. But I view them as relatively safe havens in that they have high free cash flow yields and potential cyclical upside in earnings. I feel more strongly about The Cheesecake Factory at this point because the concept has already improved its same-store sales trends with some strategies that they've initiated this year.

TWST: What about some of the other segments?

Ms. Zackfia: The two other major sub-categories are QSR (quick-service restaurants) and fine dining. QSR I think is tough. Trends have just begun to take a material turn to the negative, with breakfast and lunch sales tending to be more coincidentally correlated with unemployment. In addition, I feel like we're just at that inflection point where pricing power has really started to evaporate in QSR. So I don't see an easy path ahead, at least in the near future, for regaining traction.

Fine dining tends to be more tied to the business cycle. In past recessions, business-cycle spending has tended to lag consumer spending. So I don't expect we're going to see booming convention business or booming business travel until we've already seen a fairly substantial uptick in consumer spending. So I think that's going to take a bit longer to play out.

TWST: You mentioned that pricing power is evaporating in QSR. Do you see pricing power elsewhere? Why do you say it's evaporating in QSR?

Ms. Zackfia: Casual dining has had pricing power issues for about two years, so it's not new in casual dining that pricing power is elusive. QSR actually has had an unusual run of about five years of nice pricing power. In fact, prior to 2003-2004, pricing power had been fairly nonexistent in QSR for years. But in 2003, when McDonald's (MCD) made the decision to broaden its product assortment and elevate its product quality, the company in effect created a pricing umbrella for competitors. This year in QSR, average check degradation has accelerated with some consumers trading down within the menu, which is not a positive sign in terms of pricing power. So while pricing power isn't easy for any company right now, this is a rather new development in QSR relative to the established paradigm we've had in casual dining now for a couple of years.

The remainder of this 137 page Travel and Leisure--Airlines, Hotels, Resorts, Cruise Lines, and Restaurants Report can be immediately viewed by purchasing online.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 137 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.

For Information on subscribing to The Wall Street Transcript, please call 800/246-7673

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Travel+Leisure launches Southeast Asia travel site - CNNGo.com

Posted: 02 Dec 2009 04:38 AM PST

Tourists are one baby step closer to attaining even more info on Southeast Asia with the launch of the Travel + Leisure Southeast Asian website yesterday.

The website, which is an extension of the widely-distributed glossy magazine Travel + Leisure Southeast Asian edition, has basic but comprehensive lodging, dining and nightlife guides for 12 vacation-friendly Asian cities.

An in-site booking portal gives users a shortcut for reserving flights, hotels and vacation packages. And their 'T+L Blogs" section rounds up what's buzzing in the 12 cities to keep travelers up-to-date with local gossip.

Users who register on the site before April 1 2010 have a chance to win free Thai Airways business class tickets to Krabi, Thailand and a complimentary stay at the brand-new Phulay Bay resort.

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Sonasta CEO and President Interview - Stephanie Sonnabend - The Wall Street Transcript (blog)

Posted: 01 Dec 2009 08:57 AM PST

December 1, 2009 - The Wall Street Transcript has just published Travel and Leisure--Airlines, Hotels, Resorts, Cruise Lines, and Restaurants Report offering a timely review of the Leisure sector. This Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.

View Details of This Special Report

Recent Wall Street Transcript Special Reports.

Stephanie Sonnabend is Chief Executive Officer, President and a member of the board of directors of Sonesta International Hotels Corp., the hotel business her grandfather, A.M. Sonnabend, founded in the 1940s. Ms. Sonnabend oversees the company's 29 hotels, resorts and Nile cruises located in the United States, St. Maarten, Egypt, Peru, Colombia, Chile and Brazil. In 2007 she celebrated her 30th year with the company.

Prior to becoming CEO and President in 2003, Ms. Sonnabend served as Sonesta's President since 1996, Executive Vice President from 1993 to 1995 and Vice President of Marketing from 1984 to 1992. Her professional memberships include the World Presidents' Organization, Massachusetts Women's Forum and the Boston Club. She serves on the board of overseers of Beth Israel Deaconess Medical Center and the New England Conservatory of Music, where she chairs the facilities committee. She is currently on the board of directors of Century Bank & Trust and Century Bancorp, where she is a member of the audit and asset liability committees.

In 2005 Ms. Sonnabend launched Youth Micro Credit International, a student-run organization whose mission is to spread the word that small amounts of money loaned to people in developing countries can significantly improve their lives. A magna cum laude graduate of Harvard University, Ms. Sonnabend received her master's degree from MIT's Sloan School of Management.

TWST: Please start with a brief history and overview of Sonesta.

Ms. Sonnabend: Sonesta (SNSTA) is a company that was started in the 1940s by my grandfather, A.M. Sonnabend, who was involved in real estate and was an entrepreneur who invested in hotels. And at that point, he also bought into a public company, so we've been public since the 1940s. We're currently traded on Nasdaq, and since that time the company has grown and evolved to where it is today. It had a number of different names early on - Sonnabend Operated Hotels, Hotel Corporation of America - and the name became Sonesta in the early 1970s as a way to unify our hotels under one brand.

TWST: How many properties do you have in your portfolio today? How do they break down in terms of owned versus managed versus franchised? What geographic markets do you have a presence in?

Ms. Sonnabend: We have 29 properties in total. Three of them are in the United States, so 26 are international. We own one of them, the Royal Sonesta Hotel in Boston, and then we have a lease in the Royal Sonesta Hotel in New Orleans. And our other one in the United States, in Miami, is a managed property. We also manage six hotels and six cruises on the Nile in Egypt, so we've got 12 properties in Egypt, about 2,500 rooms. We also have an international franchise program, where we have two franchise hotels in St. Maarten, six in Peru, three in Chile, one in Colombia and two in Brazil. The total room count is about 5,700 rooms collectionwide.

TWST: Hotel and cruise combined?

Ms. Sonnabend: Hotel and cruise under Sonesta, correct; 267 rooms are cruise, so the majority are hotels - about 5,500 hotel rooms.

TWST: How much of the overall business do the cruise ships represent versus the hotel/resort properties?

Ms. Sonnabend: Our cruise ships are relatively small, anywhere from 35 cabins on up to the largest one, which is under 70 cabins. And our smallest boat is actually eight cabins.

The remainder of this 37 page Travel and Leisure--Airlines, Hotels, Resorts, Cruise Lines, and Restaurants Report can be immediately viewed by purchasing online.

The Wall Street Transcript is a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs and research analysts. This 137 page special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

The Wall Street Transcript does not endorse the views of any interviewees nor does it make stock recommendations.

For Information on subscribing to The Wall Street Transcript, please call 800/246-7673

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