EX-99.2 4 g74351ex99-2.txt SLIDE PRESENTATION EXHIBIT 99.2 Gaylord Entertainment Co. Analyst Conference February 19-20, 2002 Gaylord Palms Resort & Convention Center [GAYLORD ENTERTAINMENT LOGO] Slide 1 The information contained in this slide presentation is summary information that is intended to be considered in the context of Gaylord Entertainment's SEC filings and other public announcements it makes, by press release or otherwise, from time to time. The Company undertakes no duty or obligation to publicly update or revise the information contained in this slide presentation, although it may do so from time to time as management believes is warranted. Any such updating may be made through the filing of reports or documents with the SEC, through press releases or through other public disclosure. This slide presentation contains statements as to the Company's beliefs and expectations of the outcome of future events that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. These include the risks and uncertainties associated with economic conditions affecting the hospitality business generally, the timing of the opening of new hotel facilities, costs associated with developing new hotel facilities, business levels at the Company's hotels, the ability to successfully complete potential divestitures, and the ability to consummate the financing for new developments. Other factors that could cause operating and financial results to differ are described in the filings made from time to time by the Company with the Securities and Exchange Commission. The Company does not undertake any obligation to release publicly any revisions to forward-looking statements made by it to reflect events or circumstances occurring after the date hereof or the occurrence of unanticipated events. [GAYLORD ENTERTAINMENT LOGO] Slide 2 Collapsed Divisional Overhead - Divisional structure was removed - Reorganized Hotels, Attractions and MM&E units to create one strategy group - Initial annual cost savings of approximately $8 M July August September October November December January February 2001 2001 2001 2001 2001 2001 2002 2002
[GAYLORD ENTERTAINMENT LOGO] Slide 3 New Corporate HR Policies - Conducted market research leading to: - Health & welfare improvements - 401k improvements - Implemented consistent grading and titles - Tied bonus to Company profitability - Developed long term compensation program July August September October November December January February 2001 2001 2001 2001 2001 2001 2002 2002
[GAYLORD ENTERTAINMENT LOGO] Slide 4 Compensation Philosophy - Externally competitive and internally equitable - Short-term incentive compensation will be tied to individual and organizational performance with increased rewards for outstanding individual performance - Long-term compensation will provide substantial earnings opportunities for achieving long-term goals - The combination of long-term and annual compensation should result in total compensation that is above average for the industry provided superior long-term performance is achieved [GAYLORD ENTERTAINMENT LOGO] Slide 5 New Corporate Finance Policies - Signature authorization - Capital policy - 12% return target on all new investments July August September October November December January February 2001 2001 2001 2001 2001 2001 2002 2002
[GAYLORD ENTERTAINMENT LOGO] Slide 6 Non-core Assets Identified [NASHVILLE PREDATORS LOGO] [OPRY MILLS LOGO] [GET MANAGEMENT LOGO] [BASS PRO SHOPS LOGO] [COUNTRY MUSIC TELEVISION INTERNATIONAL LOGO] [WORLD ENTERTAINMENT LOGO] [GAYLORD ENTERTAINMENT LOGO] Slide 7 Non-Core Assets DISPOSED - Gaylord Digital - Word - CMTI - Pandora Films - Z Music - Gaylord Studios - GET Event TV - Sports Group - GET Productions - GET Management - MM&E Admin TO BE DISPOSED - Minority interest in Predators - Minority interest in Opry Mills Collectively, - OKC Redhawks these four are - Real Estate $300 - $400M in Value TO BE DETERMINED - Acuff-Rose - Minority interest in Bass Pro Shops [GAYLORD ENTERTAINMENT LOGO] Slide 8 Remaining Non-Core Assets - Acuff-Rose - Music publishing business - Catalogue of 55,000 songs - Including Hank Williams Sr., Roy Orbison, and Patsy Cline - Staff of 22 writers [GAYLORD ENTERTAINMENT LOGO] Slide 9 Remaining Non-Core Assets - Bass Pro Shops - Category killer in sporting goods and outdoor recreation - Strong growth trajectory - Solid same store sales [GAYLORD ENTERTAINMENT LOGO] Slide 10 Re-branding of Hotels - Extensive research told us ... - Opryland has great recognition with customers that have experienced it - Non-users are not compelled to visit - Gaylord name better aligned with hotel's image - Upscale - High quality - Destination within a destination July August September October November December January February 2001 2001 2001 2001 2001 2001 2002 2002
[GAYLORD ENTERTAINMENT LOGO] Slide 11 Re-branding of Hotels [GAYLORD OPRYLAND (TM) LOGO] ------ RESORT & CONVENTION CENTER NASHVILLE [GAYLORD PALMS(TM) LOGO] ----- RESORT & CONVENTION CENTER Florida [GAYLORD OPRYLAND(TM) LOGO] ------ RESORT & CONVENTION CENTER Texas Slide 12 Gaylord Texas - Project slowed post 9/11 - Slowdown gave us opportunity to - Review design - Re-bid contracts - Evaluate financing opportunities - $55M spend in 2002 - $240M spend in 2003 - Open by June 2004 July August September October November December January February 2001 2001 2001 2001 2001 2001 2002 2002
Slide 13 The Future Gaylord - Hospitality - Be the premier brand in the resort convention center sector - Opry/WSM Enterprises - Extend Opry brand and WSM distribution to provide premier country music content and entertainment [GAYLORD ENTERTAINMENT LOGO] Slide 14 Core of Hospitality Strategy - Loyalty - Build loyalty among meeting planners - Service - Provide exceptional service - Offer value added services such as CorporateMagic - Distribution and Product - Create convention & exhibition oriented chain [GAYLORD ENTERTAINMENT LOGO] Slide 15 Hospitality Strategy Segment Convention & Exhibition Meeting Planners Loyalty Their Customers Service Transient Leisure Gaylord Gaylord Palms Gaylord Other Distribution Nashville Florida Texas Development Attractions [GAYLORD ENTERTAINMENT LOGO] Slide 16 Loyalty - Strategy is to build Meeting Planner relationships through ... - Events: PCMA - Understanding Needs - Focus Groups - Database Tracking - VIP Marketing Strategy [GAYLORD ENTERTAINMENT LOGO] Slide 17 Product - "Under One Roof" - Unsurpassed meeting, convention & exhibition space - Innovative regional dining options - World class golf & spa facilities - Exciting on-site entertainment venues [GAYLORD ENTERTAINMENT LOGO] Slide 18 Media Content Strategy
WSM(AM) Opry Hee Haw Library Satellite Radio Terrestrial Radio Internet Retail/Wholesale Exportation Television TV Production ----------- WSM Cable Radio Network Opry --------- Opry ----------- Syndication Opry Tour Lifestyle ----------- Broadcast Product Channel Opry WSM --------- Licensing --------- ----------- ---- Radio Customer --------- WSM Syndication WSM (limited) Database Internet Festivals Deal ----------------------------------------------------------------------------------------------------------------------------------- Sources - Fee - Ads - Retail - Toys - Sponsorship - Ads of Revenues - Ads - Sponsorship - Banner ads - Apparel - Concert - Retail - Other Promotion - Attendance to fairs ----------------------------------------------------------------------------------------------------------------------------------- Impediments - Programming need - Programming - None - None - Type of - Financial deal format production - Review viability - Investment of partner required - Network strategy
Slide 19 Gaylord Hotels - Group Focus Customer Breakdown [CHART] Transient 18% Group 82% Group Customer Breakdown [CHART] SMERF 15% Association 33% Corporate 52% [GAYLORD ENTERTAINMENT LOGO] Slide 20 Large Groups Drive Occupancy Year 2000 Comparison of Group Size to Hotel Occupancy [CHART]
800+ 200-800 10-200 % of Rooms 66% 23% 11% # of Groups 71 104 671
[GAYLORD ENTERTAINMENT LOGO] Slide 21 Occupancy - Known and Predictable - Assume occupancy = 75% in a given year - 50% pre-booked before the year begins - 10% group booked in the year for the year - 15% transient - High visibility on occupancy - Opportunity to manage yield [GAYLORD ENTERTAINMENT LOGO] Slide 22 The Group Meeting Market Convention/Meeting/Exhibition Market [CHART]
Association Corporate Incentive Meetings Meetings Travel ----------- --------- --------- 54% 38% 8%
- Total market size estimated at $122 billion Source: Successful Meetings - State of the Industry 2001 Report [GAYLORD ENTERTAINMENT LOGO] Slide 23 Corporate and Association Meetings Corporate & Association Meetings Statistics [CHART]
Other Conference Convention Facilities Centers Centers Hotels ---------- ---------- ---------- ------ 15% 8% 38% 39%
- Gaylord Hotels product is designed to attract business that goes to Hotels & Convention Centers, an $86 Billion market. Source: Successful Meetings - State of the Industry 2001 Report [GAYLORD ENTERTAINMENT LOGO] Slide 24 GET CONSOLIDATED NET REVENUE(*) [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Gaylord Media 6.2 6.4 6.5 6.8 Gaylord Attractions 63.2 65.9 66.7 79.9 Gaylord Hotels 237.3 228.7 361.9 397.4 26% CAGR $334.6 $324.1 479.7 $523.6
(*) From continuing operations In millions ($000,000) [GAYLORD ENTERTAINMENT LOGO] Slide 25 GET Consolidated EBITDA* [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Gaylord Media (21.9) 4.2 3.5 4.1 Gaylord Corporate (29.2) (31.1) (29.4) (28.3) Gaylord Attractions (1.6) 3.4 6.1 8.8 Gaylord Hotels 74.9 59.6 93.5 112 63% CAGR $21.1 $36.1 $73.6 $96.4
In Millions ($000,000) *From continuing operations. EBITDA is before pre-opening & non-cash expenses. [GAYLORD ENTERTAINMENT LOGO] Slide 26 GET Consolidated EPS [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- EPS (4.60) (1.42) (1.37) (0.76)
[GAYLORD ENTERTAINMENT LOGO] Slide 27 GET Consolidated Cash EPS*
[CHART] 2000 2001 2002 2003 Cash EPS $0.24 $0.52 $1.58 $1.74
* From continuing operations Cash EPS defined as EBITDA less net cash interest expense [GAYLORD ENTERTAINMENT LOGO] Slide 28 Income Statement/ Balance Sheet complexity - Secured forward exchange contract - $26.8 million non-cash interest expense annually - Capitalized interest - Straight-line accounting treatment - Ground lease payment $6.7 million - Naming rights agreement $1.0 million [GAYLORD ENTERTAINMENT LOGO] Slide 29 Secured Forward Exchange Contract ("SAILS") - Seven year forward sale of Viacom Class-B stock - maturity May 22, 2007 - Pre-paid loan secured by Viacom stock; stock value hedged with derivatives - 10.9 million shares monetized at $56.0448 - May settle contract with Viacom stock or cash at maturity - At maturity:
VIACOM CLASS-B EFFECT PRICE --------------------------------------------------------------------- Below $56.0448 - Gaylord surrenders stock or $613 M cash - No downside Between $56.0448 - Gaylord retains upside in stock up to $75.0665 and $75.6605 Above $75.6605 - Same as above except Gaylord retains 25.93% upside above $75.6605
[GAYLORD ENTERTAINMENT LOGO] Slide 30 SAILS Accounting Treatment
BALANCE SHEET INCOME STATEMENT ------------- ---------------- - Market-to-Market - Gain or loss on Viacom Viacom Investment stock investment flows through P/L - Market-to-Market put option asset, call - Gain or loss on option liability derivatives contracts flow through P/L - $613 million liability = secured forward - Amortize deferred exchange contract financing cost through interest expense $26.8 - Long-term asset: million per annum deferred financing cost * Pre-paid, hedged liability * All non-operating, non-cash items
[GAYLORD ENTERTAINMENT LOGO] Slide 31 Pre-Bookings - A Critical Element
2002 2003 2004 ---- ---- ---- Gaylord Opryland 49.0% 41.7% 34.0% Gaylord Palms 55.0% 50.0% 36.1%
[GAYLORD ENTERTAINMENT LOGO] Slide 32 Pre-booking and Projected Occupancy
2002 2003 2004 ---- ---- ---- GAYLORD OPRYLAND Pre-booked Prior to '02 49.0% 41.7% 34.0% 2002 Booking 9.0% 9.5% 10.0% 2003 Booking -- 9.0% 9.5% 2004 Booking -- -- 9.0% Total Group Occupancy 58.0% 60.2% 62.5% Transient 13.4% 12.8% 11.5% Total Occupancy 71.4% 73.0% 74.0%
2002 2003 2004 ---- ---- ---- GAYLORD PALMS Pre-booked Prior to '02 55.0% 50.0% 36.1% 2002 Booking 10.0% 6.0% 15.0% 2003 Booking -- 10.0% 6.0% 2004 Booking -- -- 10.0% Total Group Occupancy 65.0% 66.0% 67.1% Transient 9.0% 10.0% 10.9% Total Occupancy 74.0% 76.0% 78.0%
[GAYLORD ENTERTAINMENT LOGO] Slide 33 Key Operating Statistics - Guidelines
1Q 2Q 3Q 4Q 2002 2003 -- -- -- -- ---- ---- Gaylord Opryland Occupancy 63-65% 66-68% 72-74% 76-78% 69-71% 73% ADR $ 143 $ 146 $ 140 $ 150 $ 145 $150 RevPAR $ 90-93 $ 96-99 $100-104 $114-117 $100-103 $109 Gaylord Palms Occupancy 68-70% 72-74% 75-78% 72-74% 72-74% 80% ADR $ 180 $ 180 $ 160 $ 190 $ 180 $200 RevPAR $122-126 $129-133 $120-125 $136-140 $130-133 $160
[GAYLORD ENTERTAINMENT LOGO] Slide 34 Hotel Economics - 2002 E
Gaylord Gaylord Palms Opryland ------- -------- ADR $ 179.33 $ 146.19 Occupancy 74.2% 71.4% RevPAR $ 133.06 $ 104.44 Revenues Rooms 67,247,940 49.4% 110,206,064 50.4% F&B 47,980,318 35.3% 71,719,777 32.8% Other 20,852,369 15.3% 36,574,159 16.7% ----------- ----------- Total Revenue 136,080,627 218,500,000 Profit Rooms 50,013,792 74.4% 85,446,495 77.5% F&B 14,228,915 29.7% 19,530,534 27.2% Other 9,223,355 44.2% 10,652,357 29.1% ----------- ----------- 73,466,062 54.0% 115,629,386 52.9% EBITDA 36,500,000 26.8% 55,000,000 25.2%
Target is 30% [GAYLORD ENTERTAINMENT LOGO] Slide 35 Gaylord Hotels Segment Net Revenue [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Radisson Nashville 6.7 6.6 7.4 8.1 Opryland Texas 0.8 0.2 0 0 Palms Florida 0 0 136.1 151.5 Opryland Nashville 229.9 222 218.5 237.8
EBITDA (before Pre-opening, & non-cash expenses) [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Radisson Nashville 2.1 2 2.1 2.3 Opryland Texas 0.8 0.2 0 0 Palms Florida 0 0 36.5 51.1 Opryland Nashville 72.6 57.4 55 66.6
EBITDA Margin [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Opryland Nashville 32% 26% 25% 28% Palms Florida 27% 28% Radisson Nashville 32% 30% 28% 29%
[GAYLORD ENTERTAINMENT LOGO] Slide 36 Gaylord Attractions Net Revenue [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Other 17.2 10.4 11.8 12.5 Corporate Magic 13.7 23.7 20.5 31 Wildhorse Nashville 8.1 7.5 8.1 8.8 General Jackson 12.2 10.8 11.8 12.2 Grand Ole Opry 12 13.4 14.5 15.4
EBITDA [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Other (2.4) 0.9 0.7 1.1 Corporate Magic (3.2) (1.6) 0.1 1.5 Wildhorse Nashville 0.8 0.7 0.8 0.9 General Jackson 2.6 1.9 2.2 2.5 Grand Ole Opry 0.5 1.6 2.4 2.9
EBITDA Margin [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Grand Ole Opry 4.5% 11.7% 16.5% 18.8% General Jackson 21.7% 17.9% 18.7% 20.1% Wildhorse Nashville 10.2% 8.8% 9.7% 10.2% Corporate Magic (23.4%) (7.0)% 0.0% 5.0% Other (14.0%) 9.0% 6.0% 9.0%
[GAYLORD ENTERTAINMENT LOGO] Slide 37 Media Segment Revenue [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Radio (WSM and WWTN) 11.8 10.6 12.7 13.7 Acuff-Rose Music 14.1 14.8 16 16.8
EBITDA [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Radio (WSM and WWTN) 1.3 0.3 0 0.2 Acuff-Rose Music 3.6 4 3.6 3.9
EBITDA Margin [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- Acuff-Rose Music 25.7% 27.3% 22.7% 23.2% Radio (WSM and WWTN) 11.0% 2.8% 0.0% 1.5%
In Millions ($000,000) [GAYLORD ENTERTAINMENT LOGO] Slide 38 GET Consolidated Capital Expenditures
[CHART] 2001 2002 2003 ---- ---- ---- Gaylord Hotels 285.7 135 258.1 Gaylord Attractions 8.9 1.4 2.7 Gaylord Corporate 3.3 12.1 12.1 Gaylord Media 0 0.7 0.7 $276.4 $149.3 $273.6
In Millions ($000,000) [GAYLORD ENTERTAINMENT LOGO] Slide 39 GET Consolidated Net Debt(*) [CHART]
2000 2001 2002 2003 ---- ---- ---- ---- $148.9 $396.4 $401.3 $596.4
In Millions ($000,000) (*)Excluding secured forward exchange contract & asset sales [GAYLORD ENTERTAINMENT LOGO] Slide 40 Sensitivity Analysis Credit Impact Debt/EBITDA [CHART] 2002 2003 5.4x 6.2x EBITDA/Interest [CHART] 2002 2003 3.3x 2.4x Pre asset sales [GAYLORD ENTERTAINMENT LOGO] Slide 41 Sources of Capital - Operating cash flow - Sell non-core assets - Selectively monetize hotel real estate - Leverage [GAYLORD ENTERTAINMENT LOGO] Slide 42 In Summary - Built a solid platform for future growth - Own great, under-exploited brands/assets - Understand how to create value - Developing the culture to Be A Shareholder Driven Company [GAYLORD ENTERTAINMENT LOGO] Slide 43