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Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2020

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 1-13079

RYMAN HOSPITALITY PROPERTIES, INC.

(Exact Name of Registrant as Specified in its Charter)

Delaware

    

73-0664379

(State or Other Jurisdiction of

(I.R.S. Employer

Incorporation or Organization)

Identification No.)

One Gaylord Drive

Nashville, Tennessee 37214

(Address of Principal Executive Offices)

(Zip Code)

(615) 316-6000

(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:

Name of Each Exchange on

Title of Each Class

Trading Symbol(s)

Which Registered

Common stock, par value $.01

RHP

New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  Yes  No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  Accelerated filer  Non-accelerated filer  Smaller reporting company  Emerging growth company 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class

    

Outstanding as of April 30, 2020

Common Stock, par value $.01

54,970,480 shares

Table of Contents

RYMAN HOSPITALITY PROPERTIES, INC.

FORM 10-Q

For the Quarter Ended March 31, 2020

INDEX

    

Page

Part I - Financial Information

3

Item 1. Financial Statements.

3

Condensed Consolidated Balance Sheets (Unaudited) – March 31, 2020 and December 31, 2019

3

Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited) - For the Three Months Ended March 31, 2020 and 2019

4

Condensed Consolidated Statements of Cash Flows (Unaudited) - For the Three Months Ended March 31, 2020 and 2019

5

Condensed Consolidated Statements of Stockholders’ Equity and Noncontrolling Interest (Unaudited) - For the Three Months Ended March 31, 2020 and 2019

6

Notes to Condensed Consolidated Financial Statements (Unaudited)

7

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

27

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

50

Item 4. Controls and Procedures.

50

Part II - Other Information

51

Item 1. Legal Proceedings.

51

Item 1A. Risk Factors.

51

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

52

Item 3. Defaults Upon Senior Securities.

53

Item 4. Mine Safety Disclosures.

53

Item 5. Other Information.

53

Item 6. Exhibits.

53

SIGNATURES

54

2

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Part I – FINANCIAL INFORMATION

Item 1. – FINANCIAL STATEMENTS.

RYMAN HOSPITALITY PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(In thousands)

    

March 31, 

    

December 31, 

2020

2019

ASSETS:

 

  

 

  

Property and equipment, net of accumulated depreciation (including $969,130 and $979,012 from VIEs, respectively)

$

3,129,977

$

3,130,252

Cash and cash equivalents - unrestricted (including $22,072 and $33,772 from VIEs, respectively)

 

662,156

 

362,430

Cash and cash equivalents - restricted

 

64,501

 

57,966

Notes receivable

 

99,900

 

110,135

Trade receivables, less credit loss reserve of $1,155 and $828, respectively (including $20,688 and $16,523 from VIEs, respectively)

 

78,952

 

70,768

Deferred income tax assets, net

 

 

25,959

Prepaid expenses and other assets (including $32,247 and $27,888 from VIEs, respectively)

 

112,236

 

123,845

Intangible assets (including $192,366 and $202,366 from VIEs, respectively)

197,080

207,113

Total assets

$

4,344,802

$

4,088,468

LIABILITIES AND EQUITY:

 

  

 

  

Debt and finance lease obligations (including $793,174 and $792,696 from VIEs, respectively)

$

2,951,888

$

2,559,968

Accounts payable and accrued liabilities (including $44,818 and $57,590 from VIEs, respectively)

 

240,313

 

264,915

Dividends payable

 

53,037

 

50,711

Deferred management rights proceeds

 

174,558

 

175,332

Operating lease liabilities

 

106,925

 

106,331

Deferred income tax liabilities, net

600

Other liabilities (including $24,887 and $2,174 from VIEs, respectively)

 

94,434

 

64,971

Total liabilities

3,621,755

3,222,228

Commitments and contingencies

 

 

Noncontrolling interest in consolidated joint venture

163,026

221,511

Stockholders' equity:

Preferred stock, $.01 par value, 100,000 shares authorized, no shares issued or outstanding

 

 

Common stock, $.01 par value, 400,000 shares authorized, 54,970 and 54,897 shares issued and outstanding, respectively

 

550

 

549

Additional paid-in capital

 

1,185,885

 

1,185,168

Treasury stock of 626 and 619 shares, at cost

 

(17,872)

 

(17,315)

Accumulated deficit

 

(545,104)

 

(495,514)

Accumulated other comprehensive loss

 

(63,438)

 

(28,159)

Total stockholders' equity

 

560,021

 

644,729

Total liabilities and equity

$

4,344,802

$

4,088,468

The accompanying notes are an integral part of these condensed consolidated financial statements.

3

Table of Contents

RYMAN HOSPITALITY PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

AND COMPREHENSIVE INCOME

(Unaudited)

(In thousands, except per share data)

Three Months Ended

March 31, 

    

2020

    

2019

    

Revenues:

 

  

 

  

 

Rooms

$

106,128

$

132,212

Food and beverage

 

145,750

 

171,143

Other hotel revenue

 

33,793

 

34,155

Entertainment

 

27,359

 

33,265

Total revenues

 

313,030

 

370,775

Operating expenses:

 

  

 

  

Rooms

 

32,308

 

34,969

Food and beverage

 

83,811

 

91,359

Other hotel expenses

 

90,474

 

90,939

Management fees, net

 

5,492

 

9,756

Total hotel operating expenses

 

212,085

 

227,023

Entertainment

 

29,346

 

25,641

Corporate

 

8,136

 

9,004

Preopening costs

 

801

 

2,134

Gain on sale of assets

(1,261)

Credit loss on held-to-maturity securities

5,828

Depreciation and amortization

53,345

53,009

Total operating expenses

 

308,280

 

316,811

Operating income

 

4,750

 

53,964

Interest expense

 

(29,358)

 

(32,087)

Interest income

 

2,371

 

2,908

Loss from unconsolidated joint ventures

 

(1,895)

 

Other gains and (losses), net

 

195

 

(141)

Income (loss) before income taxes

 

(23,937)

 

24,644

Provision for income taxes

 

(26,799)

 

(1,974)

Net income (loss)

(50,736)

22,670

Net loss attributable to noncontrolling interest in consolidated joint venture

4,220

6,738

Net income (loss) available to common stockholders

$

(46,516)

$

29,408

Basic income (loss) per share available to common stockholders

$

(0.85)

$

0.57

Diluted income (loss) per share available to common stockholders

$

(0.85)

$

0.57

Comprehensive income (loss), net of taxes

$

(88,173)

$

22,779

Comprehensive loss, net of taxes, attributable to noncontrolling interest

12,829

6,738

Comprehensive income (loss), net of taxes, available to common stockholders

$

(75,344)

$

29,517

The accompanying notes are an integral part of these condensed consolidated financial statements.

4

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RYMAN HOSPITALITY PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

Three Months Ended

March 31, 

    

2020

    

2019

    

Cash Flows from Operating Activities:

 

  

 

  

 

Net income (loss)

$

(50,736)

22,670

Amounts to reconcile net income (loss) to net cash flows provided by operating activities:

 

Provision for deferred income taxes

 

26,559

1,100

Depreciation and amortization

 

53,345

53,009

Amortization of deferred financing costs

 

1,894

1,927

Credit loss on held-to-maturity securities

5,828

Loss from unconsolidated joint ventures

1,895

Stock-based compensation expense

 

2,230

2,026

Changes in:

 

Trade receivables

 

(8,345)

(42,050)

Accounts payable and accrued liabilities

 

(26,297)

17,632

Other assets and liabilities

 

(1,702)

(1,754)

Net cash flows provided by operating activities

 

4,671

 

54,560

Cash Flows from Investing Activities:

 

  

 

  

Purchases of property and equipment

 

(43,168)

(48,873)

Investment in other joint ventures

 

(3,090)

(102)

Other investing activities

 

1,004

(127)

Net cash flows used in investing activities

 

(45,254)

 

(49,102)

Cash Flows from Financing Activities:

 

  

 

  

Net borrowings under revolving credit facility

 

400,000

10,000

Repayments under term loan B

 

(1,250)

Borrowing under Gaylord Rockies construction and mezzanine loans

28,897

Deferred financing costs paid

 

(106)

Payment of dividends

 

(50,078)

(44,420)

Payment of tax withholdings for share-based compensation

 

(1,631)

(3,813)

Other financing activities

 

(91)

1,605

Net cash flows provided by (used in) financing activities

 

346,844

 

(7,731)

Net change in cash, cash equivalents, and restricted cash

 

306,261

 

(2,273)

Cash, cash equivalents, and restricted cash, beginning of period

 

420,396

 

149,089

Cash, cash equivalents, and restricted cash, end of period

$

726,657

$

146,816

Reconciliation of cash, cash equivalents, and restricted cash to balance sheet:

Cash and cash equivalents - unrestricted

$

662,156

$

94,873

Cash and cash equivalents - restricted

64,501

 

51,943

Cash, cash equivalents, and restricted cash, end of period

$

726,657

$

146,816

The accompanying notes are an integral part of these condensed consolidated financial statements.

5

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RYMAN HOSPITALITY PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND NONCONTROLLING INTEREST

(Unaudited)

(In thousands)

    

    

    

    

    

Accumulated

    

    

Additional

Other

Total

Common

Paid-in

Treasury

Accumulated

Comprehensive

Stockholders'

Noncontrolling

Stock 

Capital 

Stock

Deficit

Loss

Equity

Interest

BALANCE, December 31, 2019

$

549

$

1,185,168

$

(17,315)

$

(495,514)

$

(28,159)

$

644,729

$

221,511

Net loss

 

 

 

 

(46,516)

 

 

(46,516)

 

(4,220)

Adjustment of noncontrolling interest to redemption value

54,265

54,265

(54,265)

Transition adjustment related to adoption of ASU 2016-13

(5,343)

2,158

(3,185)

Other comprehensive loss, net of income taxes

 

 

 

 

 

(37,437)

 

(37,437)

 

Payment of dividends ($0.95 per share)

 

 

147

(557)

(51,996)

 

 

(52,406)

 

Restricted stock units and stock options surrendered

 

1

(1,660)

 

 

 

 

(1,659)

 

Stock-based compensation expense

 

 

2,230

 

 

 

 

2,230

 

BALANCE, March 31, 2020

$

550

$

1,185,885

$

(17,872)

$

(545,104)

$

(63,438)

$

560,021

$

163,026

    

    

    

    

    

Accumulated

    

    

Additional

Other

Total

Common

Paid-in

Treasury

Accumulated

Comprehensive

Stockholders'

Noncontrolling

Stock 

Capital 

Stock

Deficit

Loss

Equity

Interest

BALANCE, December 31, 2018

$

513

$

900,795

$

(15,183)

$

(388,524)

$

(28,024)

$

469,577

$

287,433

Net income

 

 

 

 

29,408

 

 

29,408

 

(6,738)

Adjustment of noncontrolling interest to redemption value

(10,420)

(10,420)

10,420

Transition adjustment related to adoption of ASU 2018-02

2,707

(2,707)

Other comprehensive income, net of income taxes

 

 

 

 

 

109

 

109

 

Payment of dividends ($0.90 per share)

 

 

168

 

(504)

 

(46,076)

 

 

(46,412)

 

Restricted stock units and stock options surrendered

 

1

 

(3,825)

 

 

 

 

(3,824)

 

Stock-based compensation expense

 

 

2,026

 

 

 

 

2,026

 

BALANCE, March 31, 2019

$

514

$

899,164

$

(15,687)

$

(412,905)

$

(30,622)

$

440,464

$

291,115

The accompanying notes are an integral part of these condensed consolidated financial statements.

6

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RYMAN HOSPITALITY PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

1. BASIS OF PRESENTATION:

On January 1, 2013, Ryman Hospitality Properties, Inc. (“Ryman”) and its subsidiaries (collectively with Ryman, the “Company”) began operating as a real estate investment trust (“REIT”) for federal income tax purposes, specializing in group-oriented, destination hotel assets in urban and resort markets. The Company’s owned assets include a network of upscale, meetings-focused resorts that are managed by Marriott International, Inc. (“Marriott”) under the Gaylord Hotels brand. These resorts, which the Company refers to as the Gaylord Hotels properties, consist of the Gaylord Opryland Resort & Convention Center in Nashville, Tennessee (“Gaylord Opryland”), the Gaylord Palms Resort & Convention Center near Orlando, Florida (“Gaylord Palms”), the Gaylord Texan Resort & Convention Center near Dallas, Texas (“Gaylord Texan”) and the Gaylord National Resort & Convention Center near Washington D.C. (“Gaylord National”). The Company’s other owned hotel assets managed by Marriott include the Inn at Opryland, an overflow hotel adjacent to Gaylord Opryland, and the AC Hotel at National Harbor, Washington D.C. (“AC Hotel”), an overflow hotel adjacent to Gaylord National.

The Company also owns a 62.1% interest in a joint venture (the “Gaylord Rockies joint venture”) that owns the Gaylord Rockies Resort & Convention Center near Denver, Colorado (“Gaylord Rockies”), which opened in December 2018 and is managed by Marriott. As further discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, management has concluded that the Company is the primary beneficiary of this variable interest entity. As such, the Company has consolidated the assets, liabilities and results of operations of the Gaylord Rockies joint venture in the accompanying condensed consolidated financial statements. The portion of the Gaylord Rockies joint venture that the Company does not own is recorded as noncontrolling interest in consolidated joint venture in the accompanying condensed consolidated balance sheet, and any adjustment necessary to reflect the noncontrolling interest at its redemption value is shown in the accompanying condensed consolidated statement of stockholders’ equity. Creditors of the Gaylord Rockies joint venture have no recourse to the general credit of the Company, except with respect to certain limited loan guarantees as discussed in Note 13, “Commitments and Contingencies” to the condensed consolidated financial statements included herein.

The Company also owns a number of media and entertainment assets, including the Grand Ole Opry, the legendary weekly showcase of country music’s finest performers; the Ryman Auditorium, the storied live music venue and former home of the Grand Ole Opry; WSM-AM, the Opry’s radio home; Ole Red, a brand of Blake Shelton-themed bar, music venue and event spaces; and three Nashville-based assets managed by Marriott – Gaylord Springs Golf Links (“Gaylord Springs”), the Wildhorse Saloon, and the General Jackson Showboat. The Company also owns a 50% interest in a joint venture intended to create and distribute a linear multicast and over-the-top channel dedicated to the country music lifestyle (“Circle”), which launched its broadcast network on January 1, 2020. See Note 13, “Commitments and Contingencies” to the condensed consolidated financial statements included herein for further disclosure.

The condensed consolidated financial statements include the accounts of Ryman and its subsidiaries and have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted from this report pursuant to such rules and regulations. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. In the opinion of management, all adjustments necessary for a fair statement of the results of operations for the interim periods have been included. All adjustments are of a normal, recurring nature. The results of operations for such interim periods are not necessarily indicative of the results for the full year because of seasonal and short-term variations.

The Company principally operates, through its subsidiaries and its property managers, as applicable, in the following business segments: Hospitality, Entertainment, and Corporate and Other.

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Impact of COVID-19 Pandemic

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus disease (COVID-19) as a pandemic, which continues to spread throughout the United States. COVID-19 is having an unprecedented impact on the U.S. economy, and due to the COVID-19 pandemic, there is significant uncertainty surrounding the full extent of its impact on the Company’s future results of operations and financial position.

The Company, in consultation with local governmental authorities, first determined to close its Nashville-based entertainment venues on March 15, 2020. As cancellations at the Gaylord Hotels properties began to increase, the Company and its hotel manager, Marriott, implemented a series of operational changes, beginning with scaling back operations at the hotels to reflect reduced occupancy, closing food and beverage outlets, and reducing hourly staffing and culminating with the suspension of operations at the Gaylord Hotels properties beginning March 24, 2020. Hotel employees that were laid off or furloughed were generally paid the equivalent of one week of compensation, and benefits for hotel employees are being maintained through June 30, 2020. The Gaylord Hotels properties, as well as substantially all of the Company’s entertainment assets remain closed, and the decision to reopen will be based on a number of factors and made in consultation with local health authorities.

In the Company’s Entertainment segment, in addition to the closure of its entertainment assets, the Company has taken steps to reduce operating costs in all areas. The Company is continuing to pay all full-time and part-time employees at its Company-managed properties through May 15, 2020.

To preserve liquidity, on March 17, 2020, the Company completed a $400 million draw from its existing $700 million revolving line of credit as a precaution to ensure funds are available to meet the Company’s obligations for a sustained period of time. At March 31, 2020, the Company had an additional $299.1 million available for borrowing under its revolving credit facility and $662.2 million in unrestricted cash on hand. In addition, following the payment of the Company’s first quarter 2020 dividend as discussed in Note 14, “Stockholders Equity,” to the condensed consolidated financial statements included herein, the Company suspended its regular quarterly dividend payments for the remainder of 2020. The Company’s board of directors will consider a future dividend as permitted by the Company’s credit agreement. The Company’s credit agreement amendment described in Note 17, “Subsequent Events,” to the condensed consolidated financial statements included herein, permits payment of dividends as necessary to maintain the Company’s REIT status and permits the Company to pay a dividend of $0.01 per share each quarter. Any future dividend is subject to the Company’s board of director’s determinations as to the amount of distributions and timing thereof.

The Company has deferred substantially all non-essential capital projects, in addition to delaying the Gaylord Rockies expansion project, which was scheduled to begin construction in second quarter 2020. The Gaylord Palms expansion project is continuing, and the Company believes the expansion will allow Gaylord Palms to serve groups moving meetings to next year.

The Company amended its credit facility on April 23, 2020, as described in Note 17, “Subsequent Events.” The Company continues to pay all required debt service payments on its indebtedness, lease payments, taxes and other payables.

The Company’s smaller hotels, the Inn at Opryland and the AC Hotel, as well as Gaylord Springs, remain operational, and the Company currently has no plans to temporarily close these businesses. Revenues from these assets have been negligible during the COVID-19 pandemic.

Block 21 Acquisition

In December 2019, the Company entered into an agreement to purchase Block 21, a mixed-use entertainment, lodging, office and retail complex located in Austin, Texas, for $275 million, which includes the assumption of approximately $141 million of existing mortgage debt. Block 21 is the home of the Austin City Limits Live at The Moody Theater (“ACL Live”), a 2,750-seat entertainment venue that serves as the filming location for the Austin City Limits television series. The Block 21 complex also includes the 251-room W Austin Hotel, the 350-seat 3TEN at ACL Live club and approximately 53,000 square feet of Class A commercial space. The Company paid a nonrefundable deposit of $15 million with the agreement, and the acquisition is subject to customary closing conditions, including, but not limited

8

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to, the consent to the Company’s assumption of the existing mortgage loan by the loan servicer. If the acquisition is completed, the Company intends to fund the acquisition with a portion of the proceeds from the equity offering discussed in Note 11, “Equity” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

Newly Issued Accounting Standards

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-13, “Financial Instruments – Credit Losses – Measurement of Credit Losses on Financial Instruments,” which changes how entities measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. The ASU replaces the previous “incurred loss” approach with an “expected loss” model for instruments measured at amortized cost. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities are required to use a new forward-looking “expected loss” model that generally will result in the earlier recognition of allowances for losses. The Company has applied these amendments with a modified-retrospective approach, with a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. For debt securities for which an other-than-temporary impairment has been previously recognized, a prospective transition approach for the prior other-than-temporary impairment is required. The Company adopted this ASU in the first quarter of 2020 and recorded an adjustment to beginning retained earnings of $5.3 million and an adjustment to accumulated other comprehensive loss of $2.2 million. See Note 4, “Accumulated Other Comprehensive Loss” and Note 6, “Notes Receivable” for additional disclosure.

In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform – Facilitation of the Effects of Reference Rate Reform on Financial Reporting,” which provides temporary optional expedients and exceptions to the existing guidance on contract modifications and hedge accounting to ease the financial reporting burdens of the expected market transition from the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates, such as the Secured Overnight Financing Rate (“SOFR”). The guidance in ASU 2020-04 is optional, effective immediately, and may be elected over time as reference rate reform activities occur generally through December 31, 2022. During the first quarter of 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of this guidance and may apply other elections as applicable as additional market changes occur.

2. REVENUES:

Revenues from occupied hotel rooms are recognized over time as the daily hotel stay is provided to hotel groups and guests. Revenues from concessions, food and beverage sales, and group meeting services are recognized over the period or at the point in time those goods or services are delivered to the hotel group or guest. Revenues from ancillary services at the Company’s hotels, such as spa, parking, and transportation services, are generally recognized at the time the goods or services are provided. Cancellation fees and attrition fees, which are charged to groups when they do not fulfill the minimum number of room nights or minimum food and beverage spending requirements originally contracted for, are generally recognized as revenue in the period the Company determines it is probable that a significant reversal in the amount of revenue recognized will not occur, which is typically the period these fees are collected. The Company generally recognizes revenues from the Entertainment segment at the point in time that services are provided or goods are delivered or shipped to the customer, as applicable. Almost all of the Company’s revenues are either cash-based or, for meeting and convention groups who meet the Company’s credit criteria, billed and collected on a short-term receivables basis. The Company is required to collect certain taxes from customers on behalf of government agencies and remit these to the applicable governmental entity on a periodic basis. These taxes are collected from customers at the time of purchase but are not included in revenue. The Company records a liability upon collection of such taxes from the customer and relieves the liability when payments are remitted to the applicable governmental agency.

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The Company’s revenues disaggregated by major source are as follows (in thousands):

Three Months Ended

March 31, 

    

2020

    

2019

Hotel group rooms

$

82,711

$

102,692

Hotel transient rooms

 

23,417

 

 

29,520

Hotel food and beverage - banquets

 

108,170

 

 

126,196

Hotel food and beverage - outlets

 

37,580

 

 

44,947

Hotel other

 

33,793

 

 

34,155

Entertainment admissions/ticketing

 

10,281

 

 

13,623

Entertainment food and beverage

 

10,027

 

 

12,039

Entertainment retail and other

 

7,051

 

 

7,603

Total revenues

 

$

313,030

 

$

370,775

The Company’s Hospitality segment revenues disaggregated by location are as follows (in thousands):

Three Months Ended

March 31, 

    

2020

    

2019

Gaylord Opryland

 

$

76,127

$

88,958

Gaylord Palms

 

45,375

 

59,917

Gaylord Texan

 

55,996

 

72,039

Gaylord National

 

49,394

 

65,630

Gaylord Rockies

54,598

45,243

AC Hotel

 

1,849

 

2,435

Inn at Opryland and other

 

2,332

 

3,288

Total Hospitality segment revenues

$

285,671

$

337,510

The majority of the Company’s Entertainment segment revenues are concentrated in Tennessee.

The Company records deferred revenues when cash payments are received in advance of its performance obligations, primarily related to advanced deposits on hotel rooms in its Hospitality segment and advanced ticketing in its Entertainment segment. At March 31, 2020 and December 31, 2019, the Company had $77.7 million and $76.7 million, respectively, in deferred revenues, which are included in accounts payable and accrued liabilities in the accompanying condensed consolidated balance sheets. Of the amount outstanding at December 31, 2019, approximately $43.3 million was recognized in revenue during the three months ended March 31, 2020.

3. INCOME PER SHARE:

The weighted average number of common shares outstanding is calculated as follows (in thousands):

Three Months Ended

March 31, 

    

2020

    

2019

Weighted average shares outstanding - basic

54,911

51,349

Effect of dilutive stock-based compensation

215

Effect of dilutive put rights

 

 

385

Weighted average shares outstanding - diluted

 

54,911

 

51,949

For the three months ended March 31, 2020, the effect of dilutive stock-based compensation was the equivalent of 141,000 shares of common stock outstanding. Because the Company had a loss from continuing operations in the three

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months ended March 31, 2020, these incremental shares were excluded from the computation of dilutive earnings per share as the effect of their inclusion would have been anti-dilutive.

As more fully discussed in Note 13, “Commitments and Contingencies,” to the condensed consolidated financial statements included herein, certain affiliates of Ares Management, L.P. (“Ares”) each have a put right to require the Company to purchase their joint venture interests in the Gaylord Rockies joint venture in consideration of cash or operating partnership units (“OP Units”) of RHP Hotel Properties, LP (the “Operating Partnership”). Any OP Units issued by the Operating Partnership to the certain affiliates of Ares will be redeemable at the option of the holders thereof for shares of the Company’s common stock on a one-for-one basis, subject to certain adjustments. For the three months ended March 31, 2020, the effect of dilutive put rights was the equivalent of 538,000 shares of common stock outstanding. Because the Company had a loss from continuing operations in the three months ended March 31, 2020, these incremental shares were excluded from the computation of dilutive earnings per share as the effect of their inclusion would have been anti-dilutive.

4. ACCUMULATED OTHER COMPREHENSIVE LOSS:

The Company’s balance in accumulated other comprehensive loss is comprised of amounts related to the Company’s minimum pension liability discussed in Note 11, “Pension and Postretirement Benefits Other Than Pension Plans,” interest rate derivatives designated as cash flow hedges of the Company’s and the Gaylord Rockies joint venture’s outstanding debt as discussed in Note 7, “Debt,” and amounts related to an other-than-temporary impairment of a held-to-maturity investment that existed prior to the Company’s adoption of ASU 2016-13 with respect to the notes receivable discussed in Note 6, “Notes Receivable,” to the condensed consolidated financial statements included herein, and Note 3, “Notes Receivable,” to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019. Changes in accumulated other comprehensive loss by component for the three months ended March 31, 2020 and 2019 consisted of the following (in thousands):

Other-Than-

Minimum

Temporary

Pension

Impairment of

Interest Rate

    

Liability

    

Investment

    

Derivatives

    

Total

Balance, December 31, 2019

$

(23,916)

$

(5,877)

$

1,634

$

(28,159)

Losses arising during period

(1,107)

(35,947)

(37,054)

Amounts reclassified from accumulated other comprehensive loss

17

 

52

 

(452)

 

(383)

Net other comprehensive income (loss)

 

(1,090)

 

52

 

(36,399)

 

(37,437)

Transition adjustment related to adoption of ASU 2016-13 (see Note 1)

2,158

2,158

Balance, March 31, 2020

$

(25,006)

$

(3,667)

$

(34,765)

$

(63,438)

Other-Than-

Minimum

Temporary

Pension

Impairment of

Interest Rate

    

Liability

    

Investment

    

Derivatives

    

Total

Balance, December 31, 2018

$

(21,814)

$

(6,210)

$

$

(28,024)

Amounts reclassified from accumulated other comprehensive loss

 

20

 

83

 

 

103

Income tax benefit

 

6

 

 

 

6

Net other comprehensive income

 

26

 

83

 

 

109

Transition adjustment related to adoption of ASU 2018-02

(2,707)

(2,707)

Balance, March 31, 2019

$

(24,495)

$

(6,127)

$

$

(30,622)

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5. PROPERTY AND EQUIPMENT:

Property and equipment, including right-of-use finance lease assets, at March 31, 2020 and December 31, 2019 is recorded at cost (except for right-of-use finance lease assets) and summarized as follows (in thousands):

March 31, 

December 31, 

    

2020

    

2019

Land and land improvements

$

350,993

$

349,024

Buildings

 

3,441,389

 

3,432,136

Furniture, fixtures and equipment

 

969,130

 

968,858

Right-of-use finance lease assets

1,613

1,613

Construction-in-progress

 

103,815

 

82,906

 

4,866,940

 

4,834,537

Accumulated depreciation and amortization

 

(1,736,963)

 

(1,704,285)

Property and equipment, net

$

3,129,977

$

3,130,252

6. NOTES RECEIVABLE:

As further discussed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, in connection with the development of Gaylord National, the Company holds two issuances of governmental bonds (“Series A bond” and “Series B bond”) with a total carrying value and approximate fair value of $99.9 million and $110.1 million at March 31, 2020 and December 31, 2019, respectively, net of credit loss reserve of $11.0 million and $0, respectively. The Company receives debt service and principal payments thereon, payable from property tax increments, hotel taxes and special hotel rental taxes generated from Gaylord National through the maturity dates of July 1, 2034 and September 1, 2037, respectively. The Company records interest income over the life of the notes using the effective interest method.

The Company has the intent and ability to hold these bonds to maturity. In the first quarter of 2020, the Company recorded an initial transition adjustment of $5.2 million and performed its quarterly assessment of credit losses under the newly adopted credit loss standard discussed in Note 1, which considers the estimate of projected tax revenues that will service the Series B bond over its remaining term. These long-range tax revenue projections were updated as a result of the closure of Gaylord National as a result of the COVID-19 pandemic. As a result of these reduced long-range tax revenue projections over the remaining life of the Series B bond, the Company increased its credit loss reserve by $5.8 million at March 31, 2020.

During the three months ended March 31, 2020 and 2019, the Company recorded interest income of $1.5 million and $2.6 million, respectively, on these bonds. The Company received payments of $2.9 million and $3.0 million during the three months ended March 31, 2020 and 2019, respectively, relating to these bonds. At March 31, 2020 and December 31, 2019, the Company had accrued interest receivable related to these bonds of $39.0 million and $38.2 million, respectively.

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7. DEBT:

The Company’s debt and finance lease obligations at March 31, 2020 and December 31, 2019 consisted of (in thousands):

March 31, 

December 31, 

    

2020

    

2019

$700M Revolving Credit Facility, interest at LIBOR plus 1.55%, maturing March 31, 2024, less unamortized deferred financing costs of $8,126 and $0

$

391,874

$

$300M Term Loan A, interest at LIBOR plus 1.50%, maturing May 31, 2025, less unamortized deferred financing costs of $2,370 and $2,478

 

297,630

 

297,522

$500M Term Loan B, interest at LIBOR plus 2.00%, maturing May 11, 2024, less unamortized deferred financing costs of $4,268 and $4,501

 

380,732

 

381,749

$400M Senior Notes, interest at 5.0%, maturing April 15, 2023, less unamortized deferred financing costs of $2,992 and $3,222

 

397,008

 

396,778

$700M Senior Notes, interest at 4.75%, maturing October 15, 2027, less unamortized deferred financing costs of $11,489 and $11,808, plus unamortized premium of $2,367 and $2,434

 

690,878

 

690,626

$800M Term Loan (Gaylord Rockies JV), interest at LIBOR plus 2.50%, maturing July 2, 2023, less unamortized deferred financing costs of $7,483 and $8,015

 

792,517

 

791,985

Finance lease obligations

1,249

1,308

Total debt

$

2,951,888

$

2,559,968

Amounts due within one year consist of the amortization payments for the $500 million term loan B of 1.0% of the original principal balance, as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.

At March 31, 2020, the Company was in compliance with all of its covenants related to its outstanding debt, and the lenders had waived the covenant in the credit facility that prohibits closure of the Gaylord Hotels properties for longer than a specified period of time. See Note 17, “Subsequent Events,” for additional discussion.

Interest Rate Derivatives

The Company may enter into interest rate swap agreements to hedge against interest rate fluctuations. The Company and the Gaylord Rockies joint venture have each entered into interest rate swaps to manage interest rate risk associated with the Company’s $500 million term loan B and the Gaylord Rockies joint venture’s $800 million term loan, respectively. Each swap has been designated as a cash flow hedge whereby the Company or the joint venture receives variable-rate amounts in exchange for fixed-rate payments over the life of the agreement without exchange of the underlying principal amount. Neither the Company nor the Gaylord Rockies joint venture use derivatives for trading or speculative purposes and currently do not hold any derivatives that are not designated as hedges.

For derivatives designated as and that qualify as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in accumulated other comprehensive loss and subsequently reclassified to interest expense in the same period during which the hedged transaction affects earnings. These amounts reported in accumulated other comprehensive loss will be reclassified to interest expense as interest payments are made on the related variable-rate debt. The Company estimates that $13.6 million will be reclassified from accumulated other comprehensive loss to interest expense in the next twelve months.

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The estimated fair value of the Company’s derivative financial instruments at March 31, 2020 and December 31, 2019 is as follows (in thousands):

Estimated Fair Value

Asset (Liability) Balance

Strike

Notional

March 31,

December 31,

Hedged Debt

Type

Rate

Index

Maturity Date

Amount

2020

2019

Term Loan B

Interest Rate Swap

1.2235%

1-month LIBOR

May 11, 2023

$ 87,500

$

(2,464)

$

959

Term Loan B

Interest Rate Swap

1.2235%

1-month LIBOR

May 11, 2023

$ 87,500

(2,464)

959

Term Loan B

Interest Rate Swap

1.2235%

1-month LIBOR

May 11, 2023

$ 87,500

(2,464)

956