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| Strategic Hotels & Resorts Reports Fourth Quarter and Full Year 2006 Financial Results |
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CHICAGO, Feb. 28 /PRNewswire-FirstCall/ -- Strategic Hotels & Resorts (NYSE: BEE) today reported results for the fourth quarter and year ended December 31, 2006.
Full Year 2006 Financial Highlights Fourth Quarter Events Subsequent Events Laurence Geller, chief executive officer of Strategic Hotels & Resorts, commented, "The continued strength of our properties' revenue metrics reflects the high growth potential of our acquired hotels. Since our IPO in 2004, we have successfully integrated over $3.0 billion in acquisitions and have created a distinctive portfolio of high-end, irreplaceable hotels with substantial potential for long-term operational and property growth and performance. Over the past year, we strengthened our financial platform, expanded our management team and developed executable master plans for our properties. Going forward, our focus is on execution." "Same store" hotel comparisons for the fourth quarter 2006 are derived from the company's North American portfolio at December 31, 2006, consisting of properties held for five or more quarters, in which operations are included in the consolidated results of the company, and that have not sustained substantial property damage or business interruption or undergone large-scale capital projects during the reporting periods being compared. As a result, same store comparisons contain ten properties and exclude the Four Seasons Washington, D.C., acquired on March 1, 2006, the unconsolidated Hotel del Coronado, acquired on January 9, 2006, the Hyatt Regency New Orleans, which was taken out of service on August 29, 2005 due to damage resulting from Hurricane Katrina, the Westin St. Francis, acquired on June 1, 2006, the Ritz- Carlton Laguna Niguel, acquired on July 7, 2006, and the Fairmont Scottsdale Princess, acquired on September 1, 2006. "Same store" hotel comparisons for the full year 2006 are derived from the company's North American portfolio at December 31, 2006, consisting of properties held for two or more fiscal years, in which operations are included in the consolidated results of the company, and that have not sustained substantial property damage or business interruption or undergone large-scale capital projects during the reporting periods being compared. As a result, same store comparisons contain seven properties and exclude the InterContinental Chicago and InterContinental Miami, both acquired on April 1, 2005, the Fairmont Chicago, acquired on September 1, 2005, the Four Seasons Washington, D.C., the Hotel del Coronado, the Hyatt Regency New Orleans, the Westin St. Francis, the Ritz-Carlton Laguna Niguel and the Fairmont Scottsdale Princess. Total North American hotel comparisons are derived from the company's hotel portfolio at December 31, 2006, consisting of properties in which operations are included in the consolidated results of the company, and that have not sustained substantial property damage or business interruption or undergone large-scale capital projects during the reporting periods being compared. As a result, total North American portfolio comparisons contain twelve properties and exclude the Four Seasons Washington, D.C., the Ritz- Carlton Laguna Niguel, the Hotel del Coronado and the Hyatt Regency New Orleans. Period-over-period comparisons for the total North American portfolio are calculated using full period results which may include prior ownership periods. Total European hotel comparisons are derived from the company's European owned and leased hotel properties at December 31, 2006 consisting of the London Marriott Hotel Grosvenor Square, Paris Marriott Champs-Elysees, Hamburg Marriott, and InterContinental Praha. Operating Results The company reported a net loss available to common shareholders of $6.1 million, or $0.08 per diluted share for the fourth quarter of 2006, compared to net income of $14.0 million, or $0.32 per diluted share, for the fourth quarter of 2005. For the year ended December 31, 2006, the company reported net income available to common shareholders of $95.6 million, or $1.39 per diluted share, compared to net income of $23.5 million, or $0.66 per diluted share for the year ended December 31, 2005. Adjusted EBITDA for the fourth quarter of 2006 was $52.1 million, compared to $40.5 million for the fourth quarter of 2005. Excluding loss on early extinguishment of debt of $2.2 million, planning costs related to the New Orleans Jazz District of $1.0 million, and a post closing adjustment on sale of assets of $0.4 million, Comparable EBITDA was $55.8 million for the quarter, versus Comparable EBITDA of $27.4 million for the fourth quarter of 2005 after excluding loss on early extinguishment of debt of $8.1 million and gain on sale of assets of $21.2 million. For the year ended December 31, 2006, Adjusted EBITDA was $270.6 million, compared to $129.1 million for the year ended December 31, 2005. Excluding gain on sale of assets of $88.9 million, termination costs of $9.9 million, planning costs related to the New Orleans Jazz District of $3.0 million, and loss on early extinguishment of debt of $3.2 million, Comparable EBITDA was $197.7 million for the year ended December 31, 2006, versus $116.0 million for the year ended December 31, 2005 after excluding gain on sale of assets of $21.2 million and loss on early extinguishment of debt of $8.1 million. FFO in the fourth quarter of 2006 was $20.3 million, or $0.26 per fully converted share, compared to $9.2 million, or $0.17 per fully converted share in the fourth quarter of 2005. Excluding loss on early extinguishment of debt of $2.2 million, planning costs related to the New Orleans Jazz District of $1.0 million and the related net tax benefits of $0.1 million, Comparable FFO for the fourth quarter of 2006 was $23.3 million, or $0.30 per fully converted share, versus $17.3 million, or $0.33 per fully converted share, for the fourth quarter of 2005 after excluding loss on early extinguishment of debt of $8.1 million. "Fully converted" per share results represent FFO before certain minority interest adjustments, divided by the weighted average total number of shares, restricted stock units, stock options and operating company units convertible into shares. For the year ended December 31, 2006, the company reported FFO of $87.3 million, or $1.24 per fully converted share, compared to $61.3 million, or $1.37 per fully converted share for the year ended December 31, 2005. Excluding termination costs of $9.9 million and the related tax benefit of $3.8 million, planning costs related to the New Orleans Jazz District of $3.0 million and the related tax benefit of $0.6 million, and loss on early extinguishment of debt of $3.2 million, Comparable FFO for the year ended December 31, 2006 was $98.9 million or $1.41 per fully converted share, versus $69.4 million or $1.55 per fully converted share for the year ended December 31, 2005 after excluding loss on early extinguishment of debt of $8.1 million. Year-over-year Comparable FFO per share comparisons are negatively impacted by the Hyatt Regency New Orleans, which was taken out of service by Hurricane Katrina in August 2005, and several other one-time contributions to Comparable FFO in 2005. North American same store Total RevPAR increased 9.6 percent during the fourth quarter of 2006 over the prior period in 2005, driven by 6.4 percent growth in non-room revenues and 12.3 percent growth in RevPAR. Same store ADR grew 8.8 percent. For the year ended December 31, 2006, same store Total RevPAR increased 7.9 percent, driven by 6.5 percent growth in non-room revenues and 9.4 percent growth in RevPAR. Same store ADR grew 9.0 percent. Total North American Total RevPAR increased 8.6 percent during the fourth quarter of 2006 over the prior period in 2005, driven by 4.9 percent growth in non-room revenues and 11.9 percent growth in RevPAR. Total North American ADR grew 11.0 percent. For the year ended December 31, 2006, Total North American Total RevPAR increased 9.1 percent, driven by 7.1 percent growth in non-room revenues and 10.7 percent growth in RevPAR. Total North American ADR grew 10.7 percent. Total European Total RevPAR for the fourth quarter of 2006 increased 27.1 percent over the fourth quarter of 2005, due to 34.3 percent growth in non- room revenues and 25.4 percent growth in RevPAR. RevPAR growth was driven by a 22.2 percent increase in ADR. For the year ended December 31, 2006, Total RevPAR increased 17.6 percent, due to 22.2 percent growth in non-room revenues and 15.9 percent growth in RevPAR. RevPAR growth was driven by a 10.8 percent increase in ADR. North American same store EBITDA margins contracted 90 basis points in the fourth quarter of 2006 compared to the prior period in 2005. Margin expansion driven by ADR growth was offset by a correction for property-level errors in the accounting of certain expenses by Ritz-Carlton at the Half Moon Bay property. Excluding this property, EBITDA margins increased 120 basis points. Total North American gross operating profit margins increased 170 basis points in the fourth quarter of 2006 compared to the prior period in 2005. Excluding the Ritz-Carlton Half Moon Bay, total North American gross operating profit margins increased 310 basis points. For the year ended December 31, 2006, North American same store EBITDA margins expanded 160 basis points compared to the year ended December 31, 2005. Total North American gross operating profit margins increased 150 basis points.
2006 Capital Market Activity Review Quarterly Distribution The Board of Directors previously declared on December 4, 2006 a quarterly dividend of $0.23 per share of common stock, payable to shareholders of record as of the close of business Friday, December 26, 2006. The dividend was paid on January 10, 2007. Additionally, for shareholders of record as of December 15, 2006, the Board declared a quarterly dividend of $0.53125 per share of 8.50% Series A Cumulative Redeemable Preferred Stock, $0.51563 per share of 8.25% Series B Cumulative Redeemable Preferred Stock, and $0.51563 per share of 8.25% Series C Cumulative Redeemable Preferred Stock. The preferred stock dividends were paid on December 29, 2006. 2007 Outlook For the year ending December 31, 2007, the company anticipates that Comparable EBITDA will be in the range of $259.7 million to $267.2 million, Comparable FFO will be in the range of $117.3 million to $124.8 million, and Comparable FFO per fully converted share in the range of $1.50 to $1.60. The company expects 2007 North American same store Total RevPAR growth to be in the range of 5.5 percent to 6.5 percent, and RevPAR growth to be in the range of 6.5 percent to 7.5 percent. The company expects 2007 total North American Total RevPAR growth to be in the range of 6.5 percent to 7.5 percent, and RevPAR growth to be in the range of 7.5 percent to 8.5 percent. The total North American portfolio includes all consolidated North American properties as of January 1, 2007. The following tables reconcile projected 2007 net income to projected Comparable FFO and Comparable EBITDA (in millions, except per share data):
Low Range High Range
Net Income $16.1 $23.5
Deferred Tax on Realized Portion of Deferred Gain 1.3 1.3
Realized Portion of Deferred Gain on Sale
Leasebacks (4.6) (4.6)
Depreciation 99.9 99.9
Depreciation from Unconsolidated Affiliates 6.0 6.0
Minority Interests 0.7 0.8
Adjustments from Consolidated Joint Ventures (2.1) (2.1)
Comparable Funds from Operations $117.3 $124.8
Comparable FFO per Fully Converted Share $1.50 $1.60
Low Range High Range
Net Income $16.1 $23.5
Preferred Shareholder Dividends 29.8 29.8
Realized Portion of Deferred Gain on Sale
Leasebacks (4.6) (4.6)
Depreciation 99.9 99.9
Minority Interests 0.7 0.8
Adjustments from Consolidated Joint Ventures (4.1) (4.1)
Interest Expense 86.9 86.9
Adjustments from Unconsolidated Affiliates 26.0 26.0
Income Taxes 9.0 9.0
Comparable EBITDA $259.7 $267.2
The company's 2007 guidance includes the following assumptions:
-- North American same store Total RevPAR growth in the range of 5.5
percent to 6.5 percent and RevPAR growth in the range of 6.5 percent
to 7.5 percent;
-- Total North American Total RevPAR growth in the range of 6.5 percent
to 7.5 percent and RevPAR growth in the range of 7.5 percent to 8.5
percent;
-- A 50 to 100 basis point increase in North American same store EBITDA
margins and a 125 to 175 basis point expansion in total North American
gross operating profit margins;
-- No impact from the Hyatt Regency New Orleans. For the purposes of
guidance, no benefit or expense is assumed to contribute to EBITDA and
no insurance settlement is considered;
-- No acquisition, disposition or capital raising activity;
-- Furniture, fixtures and equipment spending of $44 million funded from
property FF&E reserves;
-- Capital expenditures in excess of reserves for FF&E totaling $45
million which cause displacement in revenues resulting in an
approximate reduction in EBITDA totaling $4 million in 2007;
-- No asset management fee income from distributed assets as the
company's agreement was terminated in 2006;
-- Adjusted EBITDA contribution of $2 million on European leaseholds
(lease revenue less lease expense and amortization of deferred gains
applicable to the Paris Marriott Champs-Elysees and Marriott Hamburg);
-- Corporate expenses of $28 million;
-- Average LIBOR rate of 5.35 percent;
-- No foreign currency exchange gain or loss. The company will begin
excluding foreign currency exchange gain or loss applicable to third-
party and inter-company debt and certain balance sheet items held by
foreign subsidiaries;
-- Current and deferred taxes of $9 million; and
-- No contribution to Comparable EBITDA or FFO from residential sales at
the Hotel del Coronado North Beach Village and Residence Club Punta
Mita.
First Quarter 2007 Guidance
For the first quarter of 2007, the company anticipates that Comparable EBITDA will be in the range of $53.1 million to $55.6 million, Comparable FFO will be in the range of $20.0 million to $22.5 million, and Comparable FFO per fully converted share in the range of $0.26 to $0.29. The company expects first quarter 2007 North American same store Total RevPAR growth to be in the range of 6.5 percent to 7.5 percent, and first quarter 2007 RevPAR growth to be in the range of 8.5 percent to 9.5 percent. The company expects first quarter 2007 total North American Total RevPAR growth to be in the range of 4.5 percent to 5.5 percent, and first quarter 2007 RevPAR growth to be in the range of 6.5 percent to 7.5 percent.
The following tables reconcile projected first quarter 2007 net income to
projected Comparable FFO and Comparable EBITDA (in millions, except per share
data):
Low Range High Range
Net Loss $(7.3) $(4.8)
Deferred Tax on Realized Portion of Deferred Gain 0.3 0.3
Realized Portion of Deferred Gain on Sale
Leasebacks (1.1) (1.1)
Depreciation 27.1 27.1
Depreciation from Unconsolidated Affiliates 1.5 1.5
Minority Interests 0.0 0.0
Adjustments from Consolidated Joint Ventures (0.5) (0.5)
Comparable Funds from Operations $20.0 $22.5
Comparable FFO per Fully Converted Share $0.26 $0.29
Low Range High Range
Net Loss $(7.3) $(4.8)
Preferred Shareholder Dividends 7.5 7.5
Realized Portion of Deferred Gain on Sale
Leasebacks (1.1) (1.1)
Depreciation 27.1 27.1
Minority Interests 0.0 0.0
Adjustments from Consolidated Joint Ventures (1.0) (1.0)
Interest Expense 21.0 21.0
Adjustments from Unconsolidated Affiliates 6.4 6.4
Income Taxes 0.5 0.5
Comparable EBITDA $53.1 $55.6
Earnings Call
The company will conduct its fourth quarter and year-end 2006 conference call for investors and other interested parties on Thursday, March 1 at 11:00 a.m. Eastern Time (ET). Interested individuals are invited to listen to the call by telephone at (800) 810-0924 (toll international: (913) 981-4901). To participate on the webcast, log on to http://www.strategichotels.com or www.earnings.com 15 minutes before the call to download the necessary software. For those unable to listen to the call live, a taped rebroadcast will be available beginning at 2:00 p.m. ET on March 1, 2007, through 12:00 midnight ET on March 8, 2007. To access the replay, dial (888) 203-1112 (toll international: (719) 457-0820) and request replay pin number 4469117. A replay of the call will also be available on the Internet at http://www.strategichotels.com or http://www.earnings.com for 30 days after the call. The company also produces supplemental financial data that includes detailed information regarding the operating results. This supplemental data is considered an integral part of this earnings release. These materials are available on the Strategic Hotels & Resorts website at http://www.strategichotels.com within the investor relations section. About the Company Strategic Hotels & Resorts, Inc. is a real estate investment trust (REIT) which owns and asset manages high-end hotels and resorts. The company has ownership interests in 20 properties with an aggregate of 10,000 rooms. For further information, please visit the company's website at http://www.strategichotels.com . This press release contains forward-looking statements about Strategic Hotels & Resorts (the "Company"). Except for historical information, the matters discussed in this press release are forward-looking statements subject to certain risks and uncertainties. Actual results could differ materially from the Company's projections. Factors that may contribute to these differences include, but are not limited to the following: availability of capital; ability to obtain or refinance debt; rising interest rates; rising insurance premiums; cash available for capital expenditures; competition; demand for hotel rooms in our current and proposed market areas; economic conditions generally and in the real estate market specifically; delays in construction and development; demand for hotel condominiums; marketing challenges associated with entering new lines of business; risks related to natural disasters; the pace and extent of the recovery of the New Orleans economy and tourism industry; the successful collection of insurance proceeds and rehabilitation of the New Orleans property; the effect of threats of terrorism and increased security precautions on travel patterns and hotel bookings; the outbreak of hostilities and international political instability; legislative or regulatory changes, including changes to laws governing the taxation of REITs; and changes in generally accepted accounting principles, policies and guidelines applicable to REITs. Additional risks are discussed in the Company's filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. The forward-looking statements are made as of the date of this press release, and we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended Years Ended
December 31, December 31,
2006 2005 2006 2005
Revenues:
Rooms $122,247 $60,193 $381,019 $224,850
Food and beverage 88,505 43,877 244,022 144,860
Other hotel operating revenue 27,247 12,356 74,075 43,045
237,999 116,426 699,116 412,755
Lease revenue 4,550 3,294 20,257 16,787
Total revenues 242,549 119,720 719,373 429,542
Operating Costs and Expenses:
Rooms 31,260 15,535 95,161 54,493
Food and beverage 60,537 29,862 170,141 100,689
Other departmental expenses 61,711 33,516 181,495 114,005
Management fees 10,485 3,058 26,774 13,865
Other hotel expenses 17,516 6,821 47,659 25,024
Lease expense 3,265 3,210 13,682 13,178
Depreciation and amortization 25,778 12,013 75,135 43,753
Corporate expenses 7,030 6,237 25,383 21,023
Total operating costs and
expenses 217,582 110,252 635,430 386,030
Operating income 24,967 9,468 83,943 43,512
Interest expense (20,800) (7,843) (51,111) (33,047)
Interest income 999 942 4,263 2,005
Loss on early extinguishment of
debt (2,150) (6,540) (2,150) (6,540)
Equity in (losses) earnings of
joint ventures (1,320) 503 (1,066) 2,818
Other income, net 712 1,195 4,400 5,541
Income (loss) before income
taxes, minority interests
and discontinued operations 2,408 (2,275) 38,279 14,289
Income tax expense (563) (39) (3,320) (2,401)
Minority interest (expense)
income in SHR's operating
partnership (9) 368 (703) (2,937)
Minority interest expense in
consolidated affiliates (32) - (763) -
Income (loss) from continuing
operations 1,804 (1,946) 33,493 8,951
(Loss) income from discontinued
operations, net of tax and
minority interests (468) 18,077 86,636 21,309
Net income 1,336 16,131 120,129 30,260
Preferred shareholder dividends (7,462) (2,125) (24,543) (6,753)
Net (loss) income available to
common shareholders $(6,126) $14,006 $95,586 $23,507
Basic (Loss) Income Per Share:
(Loss) income from continuing
operations available to common
shareholders per share $(0.07) $(0.09) $0.13 $0.06
(Loss) income from discontinued
operations per share (0.01) 0.41 1.27 0.60
Net (loss) income available to
common shareholders per share $(0.08) $0.32 $1.40 $0.66
Weighted-average common shares
outstanding 75,713 44,086 68,286 35,376
Diluted (Loss) Income Per Share:
(Loss) income from continuing
operations available to common
shareholders per share $(0.07) $(0.09) $0.13 $0.06
(Loss) income from discontinued
operations per share (0.01) 0.41 1.26 0.60
Net (loss) income available to
common shareholders per share $(0.08) $0.32 $1.39 $0.66
Weighted-average common shares
outstanding 75,713 44,086 68,569 35,577
Consolidated Balance Sheets
(in thousands, except share data)
Years Ended December 31,
2006 2005
Assets
Property and equipment $2,644,120 $1,300,250
Less accumulated depreciation (268,991) (217,695)
Net property and equipment 2,375,129 1,082,555
Goodwill 421,516 66,656
Intangible assets (net of
accumulated amortization of $3,166
and $1,340, respectively) 45,793 2,129
Investment in joint ventures 71,349 15,533
Cash and cash equivalents 86,462 65,017
Restricted cash and cash equivalents 73,400 32,115
Accounts receivable (net of
allowance for doubtful accounts of
$809 and $427, respectively) 70,282 31,286
Deferred financing costs (net of
accumulated amortization of $2,194
and $969, respectively) 10,701 7,544
Deferred tax assets 43,555 35,594
Other assets 57,522 84,093
Insurance recoveries receivable - 25,588
Total assets $3,255,709 $1,448,110
Liabilities and Shareholders' Equity
Liabilities:
Mortgages and other debt payable $1,442,865 $633,380
Bank credit facility 115,000 26,000
Accounts payable and accrued expenses 186,293 85,247
Distributions payable 18,175 11,531
Deferred tax liabilities 24,390 5,239
Deferred gain on sale of hotels 107,474 99,970
Insurance proceeds received in excess
of insurance recoveries receivable 20,794 -
Total liabilities 1,914,991 861,367
Minority interests in SHR's
operating partnership 12,463 76,030
Minority interests in consolidated
affiliates 10,965 11,616
Shareholders' equity:
8.5% Series A Cumulative Redeemable
Preferred Stock ($0.01 par value;
4,000,000 shares issued and outstanding;
liquidation preference $25.00 per share) 97,553 97,553
8.25% Series B Cumulative Redeemable
Preferred Stock ($0.01 par value;
4,600,000 shares issued and outstanding;
liquidation preference $25.00 per share) 110,775 -
8.25% Series C Cumulative Redeemable
Preferred Stock ($0.01 par value;
5,750,000 shares issued and outstanding;
liquidation preference $25.00 per share) 138,940 -
Common shares ($0.01 par value; 150,000,000
common shares authorized; 75,406,727 and
43,878,273 common shares issued and
outstanding, respectively) 753 439
Additional paid-in capital 1,224,400 688,250
Deferred compensation - (1,916)
Accumulated deficit (265,435) (294,755)
Accumulated other comprehensive income 10,304 9,526
Total shareholders' equity 1,317,290 499,097
Total liabilities and
shareholders' equity $3,255,709 $1,448,110
Non-GAAP Financial Measures
In addition to REIT hotel income, six other non-GAAP financial measures
are presented for the Company that we believe are useful to management and
investors as key measures of our operating performance: Funds from
Operations (FFO); FFO - Fully Converted; Comparable FFO; Earnings Before
Interest Expense, Taxes, Depreciation and Amortization (EBITDA); Adjusted
EBITDA; and Comparable EBITDA. A reconciliation of these measures to net
income available to common shareholders, the most directly comparable GAAP
measure, is set forth in the following tables.
We compute FFO in accordance with standards established by the National
Association of Real Estate Investment Trusts, or NAREIT, which adopted a
definition of FFO in order to promote an industry-wide standard measure of
REIT operating performance. NAREIT defines FFO as net income (or loss)
(computed in accordance with GAAP) excluding (losses) or gains from sales
of depreciable property plus real estate-related depreciation and
amortization, and after adjustments for our portion of these items related
to unconsolidated partnerships and joint ventures. We also present FFO -
Fully Converted, which is FFO plus minority interest expense on
convertible minority interests. We also present Comparable FFO, which is
FFO - Fully Converted excluding the impact of any gains or losses on early
extinguishment of debt, impairment losses and other non-recurring charges.
We believe that the presentation of FFO, FFO - Fully Converted and
Comparable FFO provides useful information to management and investors
regarding our results of operations because they are measures of our
ability to fund capital expenditures and expand our business. In
addition, FFO is widely used in the real estate industry to measure
operating performance without regard to items such as depreciation and
amortization.
EBITDA represents net income available to common shareholders excluding:
(i) interest expense, (ii) income tax expense, including deferred income
tax benefits and expenses applicable to our foreign subsidiaries and
income taxes applicable to sale of assets; and (iii) depreciation and
amortization. EBITDA also excludes interest expense, income tax expense
and depreciation and amortization of our equity method investments. EBITDA
is presented on a full participation basis, which means we have assumed
conversion of all convertible minority interests of our operating
partnership into our common stock and includes preferred dividends. We
believe this treatment of minority interest provides more useful
information for management and our investors and appropriately considers
our current capital structure. We also present Adjusted EBITDA, which
eliminates the effect of realizing deferred gains on our sale leasebacks.
We also present Comparable EBITDA, which eliminates the effect of gains or
losses on sales of assets, early extinguishment of debt, impairment losses
and other non-recurring charges. We believe EBITDA, Adjusted EBITDA and
Comparable EBITDA are useful to management and investors in evaluating our
operating performance because they provide management and investors with
an indication of our ability to incur and service debt, to satisfy general
operating expenses, to make capital expenditures and to fund other cash
needs or reinvest cash into our business. We also believe they help
management and investors meaningfully evaluate and compare the results of
our operations from period to period by removing the impact of our asset
base (primarily depreciation and amortization) from our operating results.
Our management also uses EBITDA, Adjusted EBITDA and Comparable EBITDA as
measures in determining the value of acquisitions and dispositions.
We caution investors that amounts presented in accordance with our
definitions of FFO, FFO - Fully Converted, Comparable FFO, EBITDA,
Adjusted EBITDA and Comparable EBITDA may not be comparable to similar
measures disclosed by other companies, since not all companies calculate
these non-GAAP measures in the same manner. FFO, Fully Converted FFO,
Comparable FFO, EBITDA, Adjusted EBITDA and Comparable EBITDA should not
be considered as an alternative measure of our net income or operating
performance. FFO, FFO - Fully Converted, Comparable FFO, EBITDA, Adjusted
EBITDA and Comparable EBITDA may include funds that may not be available
for our discretionary use due to functional requirements to conserve funds
for capital expenditures and property acquisitions and other commitments
and uncertainties. Although we believe that FFO, FFO - Fully Converted,
Comparable FFO, EBITDA, Adjusted EBITDA and Comparable EBITDA can enhance
your understanding of our financial condition and results of operations,
these non-GAAP financial measures, when viewed individually, are not
necessarily a better indicator of any trend as compared to comparable GAAP
measures such as net income available to common shareholders. In addition,
you should be aware that adverse economic and market conditions might
negatively impact our cash flow. Below, we have provided a quantitative
reconciliation of FFO, FFO - Fully Converted, Comparable FFO, EBITDA,
Adjusted EBITDA and Comparable EBITDA to the most directly comparable GAAP
financial performance measure, which is net (loss) income available to
common shareholders, and provide an explanatory description by footnote of
the items excluded from FFO, FFO - Fully Converted, EBITDA and Adjusted
EBITDA. Prior year amounts have been adjusted to conform to the current
year presentation on a fully converted basis.
Reconciliation of Net (Loss) Income Available to Common Shareholders to
EBITDA, Adjusted EBITDA and Comparable EBITDA
(in thousands)
Three Months Ended Years Ended
December 31, December 31,
2006 2005 2006 2005
Net (loss) income available to
common shareholders $(6,126) $14,006 $95,586 $23,507
Depreciation and amortization -
continuing operations 25,778 12,013 75,135 43,753
Depreciation and amortization -
discontinued operations - 1,555 2,535 8,853
Interest expense - continuing
operations 20,800 7,843 51,111 33,047
Interest expense - discontinued
operations (63) 999 1,855 4,702
Income taxes - continuing operations 563 39 3,320 2,401
Income taxes - discontinued
operations - (1,103) (3,981) (1,103)
Minority interests 3 3,057 1,827 7,396
Adjustments from consolidated
affiliates (1,014) - (4,310) -
Adjustments from unconsolidated
affiliates 5,912 1,031 27,431 4,166
Preferred shareholder dividends 7,462 2,125 24,543 6,753
EBITDA (a) 53,315 41,565 275,052 133,475
Realized portion of deferred gain on
sale leasebacks (1,189) (1,061) (4,405) (4,355)
Adjusted EBITDA (a) 52,126 40,504 270,647 129,120
Loss (gain) on sale of assets -
discontinued operations 407 (21,202) (88,871) (21,202)
Gain on sale of assets - continuing
operations - - (48) (42)
Termination costs - discontinued
operations 67 - 9,851 -
Planning costs - New Orleans Jazz
District 950 - 3,005 -
Loss on early extinguishment of debt
- continuing operations 2,150 6,540 2,150 6,540
Loss on early extinguishment of debt
- discontinued operations 63 1,575 1,000 1,575
Comparable EBITDA $55,763 $27,417 $197,734 $115,991
(a) EBITDA and Adjusted EBITDA have not been adjusted for the following
amounts included in net income available to common shareholders
because these (losses) gains and other transactions have either
occurred during the prior two years or are reasonably likely to occur
within two years (in thousands):
-- (Loss) gain on sale of assets from discontinued operations amounted
to $(407) and $21,202 for the three months ended December 31,
2006 and 2005, respectively and $88,871 and $21,202 for the years
ended December 31, 2006 and 2005, respectively.
-- Gain on sale of assets from continuing operations amounted to
$48 and $42 for the years ended December 31, 2006 and 2005,
respectively.
-- Termination costs included in discontinued operations related to the
termination of the management agreement at the Marriott Rancho Las
Palmas property amounted to $67 and $9,851 for the three months and
year ended December 31, 2006, respectively.
-- Planning costs related to the New Orleans Jazz District surrounding
the Hyatt Regency New Orleans hotel amounted to $950 and $3,005 for
the three months and year ended December 31, 2006, respectively.
-- Loss on early extinguishment of debt from continuing operations
amounted to $2,150 and $6,540 for the three months ended
December 31, 2006 and 2005, respectively and $2,150 and $6,540 for
the years ended December 31, 2006 and 2005, respectively.
-- Loss on early extinguishment of debt from discontinued operations
amounted to $63 and $1,575 for the three months ended December 31,
2006 and 2005, respectively and $1,000 and $1,575 for the years
ended December 31, 2006 and 2005, respectively.
Reconciliation of Net (Loss) Income Available to Common Shareholders to
Funds From Operations (FFO), FFO - Fully Converted and Comparable FFO
(in thousands, except per share data)
Three Months Ended Years Ended
December 31, December 31,
2006 2005 2006 2005
Net (loss) income available to common
shareholders $(6,126) $14,006 $95,586 $23,507
Depreciation and amortization -
continuing operations 25,778 12,013 75,135 43,753
Depreciation and amortization -
discontinued operations - 1,555 2,535 8,853
Gain on sale of assets - continuing
operations - - (48) (42)
Gain on sale of assets - discontinued
operations 407 (21,202) (88,871) (21,202)
Realized portion of deferred gain on
sale leasebacks (1,189) (1,061) (4,405) (4,355)
Deferred tax expense on realized
portion of deferred gain on sale
leasebacks 339 312 1,320 1,307
Minority interests adjustments (353) (2,244) (1,761) (10,546)
Adjustments from consolidated
affiliates (494) - (2,196) -
Adjustments from unconsolidated
affiliates 1,536 522 6,446 2,096
FFO (a) 19,898 3,901 83,741 43,371
Convertible minority interests 356 5,301 3,588 17,942
FFO - Fully Converted (a) 20,254 9,202 87,329 61,313
Termination costs - discontinued
operations 67 - 9,851 -
Deferred tax benefit on termination
costs - discontinued operations (26) - (3,842) -
Planning costs - New Orleans Jazz
District 950 - 3,005 -
Deferred tax benefit on planning costs
- New Orleans Jazz District (132) - (612) -
Loss on early extinguishment of debt -
continuing operations 2,150 6,540 2,150 6,540
Loss on early extinguishment of debt -
discontinued operations 63 1,575 1,000 1,575
Comparable FFO $23,326 $17,317 $98,881 $69,428
Comparable FFO per weighted-average
fully converted shares and units
outstanding $0.30 $0.33 $1.41 $1.55
Weighted-average fully converted
shares and units outstanding 77,926 52,763 70,367 44,807
(a) FFO and FFO - Fully Converted have not been adjusted for the following
amounts included in net income available to common shareholders
because these (losses) gains and other transactions have either
occurred during the prior two years or are reasonably likely to occur
within two years (in thousands):
-- Termination costs included in discontinued operations related to the
termination of the management agreement at the Marriott Rancho Las
Palmas property amounted to $67 and $9,851 for the three months and
year ended December 31, 2006, respectively.
-- Deferred tax benefit on termination costs included in discontinued
operations amounted to $26 and $3,842 for the three months and
year ended December 31, 2006, respectively.
-- Planning costs related to the New Orleans Jazz District surrounding
the Hyatt Regency New Orleans hotel amounted to $950 and $3,005 for
the three months and year ended December 31, 2006, respectively.
-- Deferred tax benefit on planning costs related to the New Orleans
Jazz District surrounding the Hyatt Regency New Orleans hotel
amounted to $132 and $612 for the three months and year ended
December 31, 2006, respectively.
-- Loss on early extinguishment of debt from continuing operations
amounted to $2,150 and $6,540 for the three months ended
December 31, 2006 and 2005, respectively and $2,150 and $6,540 for
the years ended December 31, 2006 and 2005, respectively.
-- Loss on early extinguishment of debt from discontinued operations
amounted to $63 and $1,575 for the three months ended December 31,
2006 and 2005, respectively and $1,000 and $1,575 for the years
ended December 31, 2006 and 2005, respectively.
Seasonality by Geographic Region
Same store revenues have been adjusted to show hotel performance on a
comparable quarter-over-quarter basis. Adjustments include (i) exclusion
of Hyatt Regency New Orleans due to a hurricane that ceased significant
operations in August 2005; (ii) exclusion of Hilton Burbank Airport and
Convention Center and Marriott Rancho Las Palmas as their results of
operations were reclassified to discontinued operations; and (iii)
presentation of the hotels without regard to either ownership structure or
leaseholds. Acquisition properties and the related dates of purchase are
as follows: Hotel del Coronado (January 9, 2006), Four Seasons
Washington, D.C. (March 1, 2006), Westin St. Francis (June 1, 2006) Ritz-
Carlton Laguna Niguel (July 7, 2006), Marriott London Grosvenor Square
(August 31, 2006) and Fairmont Scottsdale Princess (September 1, 2006).
United States Hotels (as of December 31, 2006)
Acquisition property revenues - 5 Properties and 3,129 Rooms
Same store property revenues - 8 Properties and 4,225 Rooms
Three Months Ended
March June September December
31, 2006 30, 2006 30, 2006 31, 2006 Total
Acquisition property
revenues (a) $31,667 $59,198 $111,663 $122,675 $325,203
Acquisition property
revenues (b) 86,784 66,307 9,830 - 162,921
Same store property
revenues 94,247 105,914 99,736 104,990 404,887
Total pro forma revenues $212,698 $231,419 $221,229 $227,665 $893,011
Pro forma seasonality % 23.8% 25.9% 24.8% 25.5% 100.0%
Mexican Hotels (as of December 31, 2006)
Same store property revenues - 2 Properties and 385 Rooms
Three Months Ended
March June September December
31, 2006 30, 2006 30, 2006 31, 2006 Total
Same store property
revenues $20,119 $17,338 $12,233 $19,978 $69,668
Same store
seasonality % 28.9% 24.9% 17.5% 28.7% 100.0%
Total North American Hotels (as of December 31, 2006)
Acquisition property revenues - 5 Properties and 3,129 Rooms
Same store property revenues - 10 Properties and 4,610 Rooms
Three Months Ended
March June September December
31, 2006 30, 2006 30, 2006 31, 2006 Total
Acquisition property
revenues (a) $31,667 $59,198 $111,663 $122,675 $325,203
Acquisition property
revenues (b) 86,784 66,307 9,830 - 162,921
Same store property
revenues 114,366 123,252 111,969 124,968 474,555
Total pro forma revenues $232,817 $248,757 $233,462 $247,643 $962,679
Pro forma seasonality % 24.2% 25.8% 24.3% 25.7% 100.0%
European Hotels (as of December 31, 2006)
Acquisition property revenues - 1 Property and 236 Rooms
Same store property revenues - 3 Properties and 841 Rooms
Three Months Ended
March June September December
31, 2006 30, 2006 30, 2006 31, 2006 Total
Acquisition property
revenues (a) $- $- $3,705 $12,005 $15,710
Acquisition property
revenues (b) 7,140 9,082 6,143 - 22,365
Same store property
revenues 17,303 25,814 27,433 23,353 93,903
Total pro forma revenues $24,443 $34,896 $37,281 $35,358 $131,978
Pro forma seasonality % 18.5% 26.4% 28.3% 26.8% 100.0%
(a) Acquisition property revenues for our period of ownership
(b) Acquisition property revenues prior to our period of ownership
Operating Statistics by Geographic Region
Operating results have been adjusted to show hotel performance on a
comparable period basis. Adjustments include (i) exclusion of Hotel del
Coronado, Four Seasons Washington, D.C., Westin St. Francis, Ritz-Carlton
Laguna Niguel, Marriott London Grosvenor Square and Fairmont Scottsdale
Princess partial year results for the three months ended December 31, 2006
and 2005; exclusion of InterContinental Chicago, InterContinental Miami,
Fairmont Chicago, Hotel del Coronado and Four Seasons Washington, D.C.,
Westin St. Francis, Ritz-Carlton Laguna Niguel, Marriott London Grosvenor
Square and Fairmont Scottsdale Princess partial year results for the years
ended December 31, 2006 and 2005; (ii) exclusion of Hyatt Regency New
Orleans due to a hurricane that ceased significant operations in August
2005; (iii) exclusion of Embassy Suites Lake Buena Vista Resort, Marriott
Schaumburg, Marriott Rancho Las Palmas and Hilton Burbank Airport and
Convention Center as these properties results of operations were
reclassified to discontinued operations; and (iv) presentation of the
European hotels without regard to either ownership structure or
leaseholds.
United States Hotels (as of December 31, 2006)
8 Properties (three month period) and 5 Properties (year end period)
4,225 Rooms (three month period) and 2,107 (year end period)
Three Months Ended Years Ended
December 31, December 31,
2006 2005 Change 2006 2005 Change
Average Daily
Rate $201.43 $186.90 7.8% $198.45 $185.66 6.9%
Average
Occupancy 69.6% 67.5% 2.1 pts 71.5% 70.8% 0.7 pts
RevPAR $140.18 $126.15 11.1% $141.90 $131.45 7.9%
Total RevPAR $264.81 $247.23 7.1% $286.32 $268.52 6.6%
Property EBITDA
Margin 21.7% 23.6% (1.9)pts 23.2% 22.2% 1.0 pts
Mexican Hotels (as of December 31, 2006)
2 Properties
385 Rooms
Three Months Ended Years Ended
December 31, December 31,
2006 2005 Change 2006 2005 Change
Average Daily
Rate $433.09 $383.37 13.0% $430.67 $369.90 16.4%
Average
Occupancy 72.6% 70.0% 2.6 pts 68.2% 70.4% (2.2)pts
RevPAR $314.40 $268.22 17.2% $293.54 $260.47 12.7%
Total RevPAR $564.03 $454.55 24.1% $496.03 $444.21 11.7%
Property EBITDA
Margin 32.1% 27.8% 4.3 pts 33.1% 30.1% 3.0 pts
North American Same Store Hotels (as of December 31, 2006)
10 Properties (three month period) and 7 Properties (year end period)
4,610 Rooms (three month period) and 2,492 Rooms (year end period)
Three Months Ended Years Ended
December 31, December 31,
2006 2005 Change 2006 2005 Change
Average Daily
Rate $221.18 $203.28 8.8% $232.89 $213.69 9.0%
Average
Occupancy 69.8% 67.7% 2.1 pts 71.0% 70.7% 0.3 pts
RevPAR $154.47 $137.61 12.3% $165.32 $151.16 9.4%
Total RevPAR $289.34 $263.95 9.6% $318.72 $295.37 7.9%
Property EBITDA
Margin 23.3% 24.2% (0.9)pts 25.6% 24.0% 1.6 pts
European Same Store Hotels (as of December 31, 2006)
3 Properties
841 Rooms
Three Months Ended Years Ended
December 31, December 31,
2006 2005 Change 2006 2005 Change
Average Daily
Rate $253.82 $206.77 22.8% $260.25 $238.67 9.0%
Average
Occupancy 80.8% 80.0% 0.8 pts 83.6% 80.1% 3.5 pts
RevPAR $205.06 $165.50 23.9% $217.60 $191.16 13.8%
Total RevPAR $301.83 $244.55 23.4% $305.91 $268.41 14.0%
Property EBITDA
Margin 33.5% 38.3% (4.8)pts 38.1% 40.6% (2.5)pts
Selected Financial and Operating Information by Property (In Thousands, Except Operating Information)
The following tables present selected financial and operating information
by property for the three months and years ended December 31, 2006 and
2005. Property EBITDA reflects property net operating income plus
depreciation and amortization.
Three Months Ended December 31, Years Ended December 31,
2006 2005 Change 2006 2005 Change
FAIRMONT CHICAGO
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $17,748 $16,289 9.0% $65,970 N/A N/A
Property EBITDA $3,988 $3,990 (0.1)% $14,501 N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the year ended
December 31, 2005, average occupancy was 73.0%, ADR was $189.49, RevPAR
was $138.41 and Total RevPAR was $238.52.):
Rooms 685 691 (6) 685 N/A N/A
Average occupancy 71.3% 69.4% 1.9 pts 74.9% N/A N/A
ADR $225.95 $208.78 8.2% $209.23 N/A N/A
RevPAR $161.11 $144.96 11.1% $156.74 N/A N/A
Total RevPAR $281.62 $256.23 9.9% $262.58 N/A N/A
FAIRMONT SCOTTSDALE PRINCESS
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $23,908 N/A N/A N/A N/A N/A
Property EBITDA $6,741 N/A N/A N/A N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the three months ended
December 31, 2005, average occupancy was 70.6%, ADR was $216.38, RevPAR
was $152.68 and Total RevPAR was $383.54. For the year ended December 31,
2006, average occupancy was 76.4%, ADR was $229.62, RevPAR was $175.50 and
Total RevPAR was $401.83. For the year ended December 31, 2005, average
occupancy was 76.1%, ADR was $215.79, RevPAR was $164.23 and Total RevPAR
was $383.43.
Rooms 651 N/A N/A N/A N/A N/A
Average occupancy 71.2% N/A N/A N/A N/A N/A
ADR $238.31 N/A N/A N/A N/A N/A
RevPAR $169.68 N/A N/A N/A N/A N/A
Total RevPAR $399.19 N/A N/A N/A N/A N/A
FOUR SEASONS WASHINGTON, D.C.
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $13,785 N/A N/A N/A N/A N/A
Property EBITDA $2,905 N/A N/A N/A N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the three months ended
December 31, 2005, average occupancy was 66.1%, ADR was $455.64, RevPAR
was $300.98 and Total RevPAR was $580.31. For the year ended December 31,
2006, average occupancy was 70.0%, ADR was $495.72, RevPAR was $347.07 and
Total RevPAR was $635.57. For the year ended December 31, 2005, average
occupancy was 37.6%, ADR was $498.69, RevPAR was $187.31 and Total RevPAR
was $386.61.):
Rooms 211 N/A N/A N/A N/A N/A
Average occupancy 71.8% N/A N/A N/A N/A N/A
ADR $503.40 N/A N/A N/A N/A N/A
RevPAR $361.47 N/A N/A N/A N/A N/A
Total RevPAR $710.13 N/A N/A N/A N/A N/A
Three Months Ended December 31, Years Ended December 31,
2006 2005 Change 2006 2005 Change
HOTEL DEL CORONADO
Selected Financial Information (This table includes financial information
only for our period of ownership. Amounts below are 100% of operations,
of which SHR owns 45%.):
Total revenues $31,220 N/A N/A N/A N/A N/A
Property EBITDA $10,596 N/A N/A N/A N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the three months ended
December 31, 2005, average occupancy was 71.2%, ADR was $283.94, RevPAR
was $202.17 and Total RevPAR was $455.53. For the year ended December 31,
2006, average occupancy was 80.0%, ADR was $337.56, RevPAR was $270.18 and
Total RevPAR was $544.31. For the year ended December 31, 2005, average
occupancy was 81.3%, ADR was $309.76, RevPAR was $251.95 and Total RevPAR
was $507.20.):
Rooms 679 N/A N/A N/A N/A N/A
Average occupancy 70.1% N/A N/A N/A N/A N/A
ADR $310.91 N/A N/A N/A N/A N/A
RevPAR $218.09 N/A N/A N/A N/A N/A
Total RevPAR $499.78 N/A N/A N/A N/A N/A
HYATT REGENCY LA JOLLA AT AVENTINE
Selected Financial Information:
Total revenues $10,389 $9,218 12.7% $41,062 $38,077 7.8%
Property EBITDA $2,774 $1,313 111.3% $10,854 $8,247 31.6%
Selected Operating Information:
Rooms 419 419 - 419 419 -
Average occupancy 77.2% 66.4% 10.8 pts 77.3% 76.4% 0.9 pts
ADR $169.55 $161.82 4.8% $180.39 $163.83 10.1%
RevPAR $130.95 $107.46 21.9% $139.50 $125.10 11.5%
Total RevPAR $269.51 $239.13 12.7% $268.49 $248.98 7.8%
HYATT REGENCY PHOENIX
Selected Financial Information:
Total revenues $9,206 $9,333 (1.4)% $37,643 $36,169 4.1%
Property EBITDA $2,170 $2,102 3.2% $9,963 $8,911 11.8%
Selected Operating Information:
Rooms 696 696 - 696 696 -
Average occupancy 58.0% 61.8% (3.8)pts 66.4% 64.9% 1.5 pts
ADR $142.92 $135.55 5.4% $136.03 $133.31 2.0%
RevPAR $82.91 $83.83 (1.1)% $90.35 $86.58 4.4%
Total RevPAR $143.77 $145.76 (1.4)% $148.18 $142.38 4.1%
INTERCONTINENTAL CHICAGO
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $19,550 $16,923 15.5% $72,249 N/A N/A
Property EBITDA $6,336 $5,776 9.7% $23,523 N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the year ended
December 31, 2005, average occupancy was 72.9%, ADR was $182.50, RevPAR
was $133.03 and Total RevPAR was $207.70.):
Rooms 792 807 (15) 792 N/A N/A
Average occupancy 79.6% 72.1% 7.5 pts 79.9% N/A N/A
ADR $222.55 $196.21 13.4% $205.40 N/A N/A
RevPAR $177.17 $141.55 25.2% $164.16 N/A N/A
Total RevPAR $268.31 $227.94 17.7% $249.93 N/A N/A
Three Months Ended December 31, Years Ended December 31,
2006 2005 Change 2006 2005 Change
INTERCONTINENTAL MIAMI
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $11,502 $10,816 6.3% $46,579 N/A N/A
Property EBITDA $2,842 $2,746 3.5% $12,589 N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the year ended
December 31, 2005, average occupancy was 72.0%, ADR was $154.04, RevPAR
was $110.89 and Total RevPAR was $190.62.):
Rooms 641 641 - 641 N/A N/A
Average occupancy 65.3% 66.4% (1.1)pts 67.3% N/A N/A
ADR $171.07 $164.89 3.7% $174.03 N/A N/A
RevPAR $111.74 $109.52 2.0% $117.14 N/A N/A
Total RevPAR $195.04 $183.41 6.3% $199.09 N/A N/A
LOEWS SANTA MONICA BEACH HOTEL
Selected Financial Information:
Total revenues $10,100 $9,479 6.6% $45,390 $42,784 6.1%
Property EBITDA $2,668 $2,785 (4.2)% $14,267 $13,921 2.5%
Selected Operating Information:
Rooms 342 342 - 342 342 -
Average occupancy 74.5% 69.9% 4.6 pts 84.1% 83.1% 1.0 pts
ADR $266.40 $261.20 2.0% $279.74 $263.34 6.2%
RevPAR $198.41 $182.63 8.6% $235.15 $218.81 7.5%
Total RevPAR $321.00 $301.26 6.6% $363.61 $342.74 6.1%
MARRIOTT LINCOLNSHIRE RESORT
Selected Financial Information:
Total revenues $12,642 $12,960 (2.5)% $40,138 $38,474 4.3%
Property EBITDA $2,344 $2,448 (4.2)% $7,478 $6,259 19.5%
Selected Operating Information:
Rooms 389 389 - 389 389 -
Average occupancy 65.0% 67.8% (2.8)pts 64.1% 66.7% (2.6)pts
ADR $138.62 $124.04 11.8% $136.65 $121.57 12.4%
RevPAR $90.03 $84.04 7.1% $87.53 $81.14 7.9%
Total RevPAR $290.17 $297.27 (2.4)% $283.47 $271.18 4.5%
RITZ-CARLTON HALF MOON BAY
Selected Financial Information:
Total revenues $13,853 $13,488 2.7% $55,852 $50,973 9.6%
Property EBITDA $(383) $2,057 (118.6)% $8,578 $8,508 0.8%
Selected Operating Information:
Rooms 261 261 - 261 261 -
Average occupancy 65.9% 63.8% 2.1 pts 70.3% 67.4% 2.9 pts
ADR $341.78 $336.71 1.5% $343.86 $328.99 4.5%
RevPAR $225.08 $214.87 4.8% $241.81 $221.71 9.1%
Total RevPAR $576.92 $561.72 2.7% $586.28 $535.07 9.6%
Three Months Ended December 31, Years Ended December 31,
2006 2005 Change 2006 2005 Change
RITZ-CARLTON LAGUNA NIGUEL
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $17,936 N/A N/A N/A N/A N/A
Property EBITDA $3,445 N/A N/A N/A N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the three months ended
December 31, 2005, average occupancy was 41.2%, ADR was $296.66, RevPAR
was $122.31 and Total RevPAR was $340.92. For the year ended December 31,
2006, average occupancy was 69.0%, ADR was $371.41, RevPAR was $256.21 and
Total RevPAR was $536.01. For the year ended December 31, 2005, average
occupancy was 48.1%, ADR was $333.75, RevPAR was $160.63 and Total RevPAR
was $358.37.):
Rooms 393 N/A N/A N/A N/A N/A
Average occupancy 64.7% N/A N/A N/A N/A N/A
ADR $337.30 N/A N/A N/A N/A N/A
RevPAR $218.10 N/A N/A N/A N/A N/A
Total RevPAR $496.07 N/A N/A N/A N/A N/A
WESTIN ST. FRANCIS
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $35,826 N/A N/A N/A N/A N/A
Property EBITDA $6,337 N/A N/A N/A N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the three months ended
December 31, 2005, average occupancy was 84.3%, ADR was $179.01, RevPAR
was $150.85 and Total RevPAR was $301.97. For the year ended December 31,
2006, average occupancy was 79.5%, ADR was $201.20, RevPAR was $159.85 and
Total RevPAR was $302.38. For the year ended December 31, 2005, average
occupancy was 83.4%, ADR was $176.44, RevPAR was $147.15 and Total RevPAR
was $274.33.):
Rooms 1,195 N/A N/A N/A N/A N/A
Average occupancy 78.7% N/A N/A N/A N/A N/A
ADR $212.98 N/A N/A N/A N/A N/A
RevPAR $167.52 N/A N/A N/A N/A N/A
Total RevPAR $325.87 N/A N/A N/A N/A N/A
HYATT REGENCY NEW ORLEANS
Selected Financial Information (For 2006, no financial information is
provided as the hotel is under redevelopment):
Total revenues N/A N/A N/A N/A $40,011 N/A
Property EBITDA N/A N/A N/A N/A $9,790 N/A
Selected Operating Information (For 2006 and the three months ended
December 31, 2005, no statistics are provided as the hotel is under
redevelopment. The number of rooms for the year ended December 31, 2005
was calculated using an average rate assuming no rooms were in use for the
months of September through December due to the hurricane.):
Rooms N/A N/A N/A N/A 779 N/A
Average occupancy N/A N/A N/A N/A 59.6% N/A
ADR N/A N/A N/A N/A $140.59 N/A
RevPAR N/A N/A N/A N/A $83.80 N/A
Total RevPAR N/A N/A N/A N/A $140.80 N/A
Three Months Ended December 31, Years Ended December 31,
2006 2005 Change 2006 2005 Change
FOUR SEASONS MEXICO CITY
Selected Financial Information:
Total revenues $7,357 $6,281 17.1% $23,239 $22,777 2.0%
Property EBITDA $2,138 $1,466 45.8% $5,297 $4,941 7.2%
Selected Operating Information:
Rooms 240 240 - 240 240 -
Average occupancy 68.6% 67.0% 1.6 pts 60.8% 64.7% (3.9)pts
ADR $242.75 $224.25 8.2% $239.15 $220.72 8.3%
RevPAR $166.45 $150.22 10.8% $145.42 $142.86 1.8%
Total RevPAR $333.20 $284.47 17.1% $265.29 $260.01 2.0%
FOUR SEASONS PUNTA MITA RESORT
Selected Financial Information:
Total revenues $12,621 $9,610 31.3% $46,429 $38,835 19.6%
Property EBITDA $4,281 $2,957 44.8% $17,776 $13,623 30.5%
Selected Operating Information:
Rooms 145 140 5 145 140 5
Average occupancy 79.3% 75.1% 4.2 pts 80.4% 80.2% 0.2 pts
ADR $705.66 $626.81 12.6% $670.90 $576.34 16.4%
RevPAR $559.29 $470.50 18.9% $539.05 $462.10 16.7%
Total RevPAR $946.10 $746.12 26.8% $878.51 $759.98 15.6%
Three Months Ended December 31, Years Ended December 31,
2006 2005 Change 2006 2005 Change
INTERCONTINENTAL PRAGUE
Selected Financial Information (Amounts below are 100% of operations, of
which SHR owned 35% prior to August 3, 2006):
Total revenues $9,176 $7,866 16.7% $35,698 $33,609 6.2%
Property EBITDA $3,580 $3,618 (1.1)% $14,891 $15,364 (3.1)%
Selected Operating Information:
Rooms 372 372 - 372 372 -
Average Occupancy 77.5% 81.2% (3.7)pts 81.0% 80.1% 0.9 pts
ADR $202.82 $172.50 17.6% $205.56 $198.93 3.3%
RevPAR $157.10 $140.11 12.1% $166.49 $159.31 4.5%
Total RevPAR $268.12 $229.84 16.7% $262.91 $247.53 6.2%
MARRIOTT HAMBURG
Selected Financial Information:
Total revenues $5,205 $4,564 14.0% $20,805 $17,183 21.1%
Property EBITDA $1,335 $1,219 9.5% $5,225 $5,005 4.4%
Selected Operating Information:
Rooms 277 277 - 277 277 -
Average occupancy 80.6% 80.4% 0.2 pts 84.4% 78.8% 5.6 pts
ADR $173.56 $147.04 18.0% $169.83 $146.42 16.0%
RevPAR $139.96 $118.15 18.5% $143.29 $115.39 24.2%
Total RevPAR $204.25 $179.09 14.0% $205.78 $169.95 21.1%
MARRIOTT LONDON GROSVENOR SQUARE
Selected Financial Information (This table includes financial information
only for our period of ownership):
Total revenues $12,005 N/A N/A N/A N/A N/A
Property EBITDA $4,688 N/A N/A N/A N/A N/A
Selected Operating Information (This table includes statistical
information only for our period of ownership. For the three months ended
December 31, 2005, average occupancy was 73.7%, ADR was $320.84, RevPAR
was $236.42 and Total RevPAR was $409.49. For the year ended December 31,
2006, average occupancy was 80.9%, ADR was $350.79, RevPAR was $283.94 and
Total RevPAR was $442.00. For the year ended December 31, 2005, average
occupancy was 76.9%, ADR was $303.52, RevPAR was $233.39 and Total RevPAR
was $347.03.):
Rooms 236 N/A N/A N/A N/A N/A
Average occupancy 80.5% N/A N/A N/A N/A N/A
ADR $379.74 N/A N/A N/A N/A N/A
RevPAR $305.60 N/A N/A N/A N/A N/A
Total RevPAR $552.92 N/A N/A N/A N/A N/A
PARIS MARRIOTT CHAMPS ELYSEES
Selected Financial Information:
Total revenues $8,972 $6,491 38.2% $37,400 $31,600 18.4%
Property EBITDA $2,903 $2,405 20.7% $15,699 $13,091 19.9%
Selected Operating Information:
Rooms 192 192 - 192 192 -
Average occupancy 87.5% 77.3% 10.2 pts 87.6% 82.0% 5.6 pts
ADR $448.08 $366.09 22.4% $483.91 $441.84 9.5%
RevPAR $391.91 $283.00 38.5% $423.82 $362.18 17.0%
Total RevPAR $507.93 $367.47 38.2% $533.68 $450.91 18.4%
Reconciliation of Property EBITDA to EBITDA
(in thousands)
Three Months Ended December 31,
2006 2005
Property Property
Hotel EBITDA EBITDA EBITDA EBITDA
Fairmont Chicago (a) $3,988 $3,988 $3,990 $3,990
Fairmont Scottsdale Princess (a) 6,741 6,741 - -
Four Seasons Washington, D.C. (a) 2,905 2,905 - -
Hotel del Coronado (b) 10,596 - - -
Hyatt Regency La Jolla at Aventine 2,774 2,774 1,313 1,313
Hyatt Regency Phoenix 2,170 2,170 2,102 2,102
InterContinental Chicago (a) 6,336 6,336 5,776 5,776
InterContinental Miami (a) 2,842 2,842 2,746 2,746
Loews Santa Monica Beach Hotel 2,668 2,668 2,785 2,785
Marriott Lincolnshire Resort 2,344 2,344 2,448 2,448
Ritz-Carlton Half Moon Bay (383) (383) 2,057 2,057
Ritz-Carlton Laguna Niguel (a) 3,445 3,445 - -
Westin St. Francis (a) 6,337 6,337 - -
Hyatt Regency New Orleans - (770) - (172)
Four Seasons Mexico City 2,138 2,138 1,466 1,466
Four Seasons Punta Mita Resort 4,281 4,281 2,957 2,957
InterContinental Prague (c) 3,580 3,872 3,618 -
Marriott Hamburg (d) 1,335 257 1,219 48
Marriott London Grosvenor Square (a) 4,688 4,688 - -
Paris Marriott Champs Elysees (d) 2,903 1,143 2,405 236
$71,688 $57,776 $34,882 $27,752
Adjustments:
Corporate expenses $(7,030) $(6,237)
Interest income 999 942
Loss on early extinguishment of debt (2,150) (6,540)
Equity in (losses) earnings of joint
ventures (1,320) 503
Other income, net 712 1,195
(Loss) income from discontinued
operations (excluding minority interest) (475) 21,502
Depreciation and amortization -
discontinued operations - 1,555
Interest expense - discontinued operations (63) 999
Income taxes - discontinued operations - (1,103)
Minority interest expense in
consolidated affiliates (32) -
Adjustments from consolidated affiliates (1,014) -
Adjustments from unconsolidated affiliates 5,912 1,031
Other adjustments - (34)
EBITDA $53,315 $41,565
(a) We have included the results of hotels acquired in Property EBITDA
above for our period of ownership.
(b) On January 9, 2006 we closed the acquisition of a 45% joint venture
ownership interest in SHC KSL Partners, LP, the existing owner of the
Hotel del Coronado in Coronado, California (San Diego). We account
for our investment under the equity method of accounting. Our equity
in earnings of the hotel joint venture is included in equity in
earnings of joint ventures in our consolidated statements of
operations. We have included the results of this hotel in Property
EBITDA above for our period of ownership.
(c) On August 3, 2006, we purchased our joint venture partner's 65%
interest in the entity that owns the InterContinental Prague. Prior
to August 3, 2006 our equity in earnings of the hotel joint venture is
included in equity in earnings of joint ventures in our consolidated
statements of operations.
(d) We have leasehold interests in these properties. Therefore, EBITDA
represents the lease revenue less the lease expense recorded in our
statements. Property EBITDA represents the revenue less expenses
generated by the property.
Reconciliation of Property EBITDA to EBITDA
(in thousands)
Years Ended December 31,
2006 2005
Property Property
Hotel EBITDA EBITDA EBITDA EBITDA
Fairmont Chicago (a) $14,501 $14,501 $- $6,357
Fairmont Scottsdale Princess (a) - 7,995 - -
Four Seasons Washington, D.C. (a) - 9,156 - -
Hotel del Coronado (b) - - - -
Hyatt Regency La Jolla at
Aventine 10,854 10,854 8,247 8,247
Hyatt Regency Phoenix 9,963 9,963 8,911 8,911
InterContinental Chicago (a) 23,523 23,523 - 18,299
InterContinental Miami (a) 12,589 12,589 - 6,439
Loews Santa Monica Beach Hotel 14,267 14,267 13,921 13,921
Marriott Lincolnshire Resort 7,478 7,478 6,259 6,259
Ritz-Carlton Half Moon Bay 8,578 8,578 8,508 8,508
Ritz-Carlton Laguna Niguel (a) - 10,774 - -
Westin St. Francis (a) - 16,026 - -
Hyatt Regency New Orleans - (2,890) 9,790 9,790
Four Seasons Mexico City 5,297 5,297 4,941 4,941
Four Seasons Punta Mita Resort 17,776 17,776 13,623 13,623
InterContinental Prague (c) 14,891 6,624 15,364 -
Marriott Hamburg (d) 5,225 733 5,005 135
Marriott London Grosvenor Square (a) - 6,032 - -
Paris Marriott Champs Elysees (d) 15,699 5,384 13,091 2,888
$160,641 $184,660 $107,660 $108,318
Adjustments:
Corporate expenses $(25,383) $(21,023)
Interest income 4,263 2,005
Loss on early extinguishment of debt (2,150) (6,540)
Equity in (losses) earnings of
joint ventures (1,066) 2,818
Other income, net 4,400 5,541
(Loss) income from discontinued
operations (excluding minority interest) 87,760 25,768
Depreciation and amortization -
discontinued operations 2,535 8,853
Interest expense - discontinued operations 1,855 4,702
Income taxes - discontinued operations (3,981) (1,103)
Minority interest expense in
consolidated affiliates (763) -
Adjustments from consolidated affiliates (4,310) -
Adjustments from unconsolidated affiliates 27,431 4,166
Other adjustments (199) (30)
EBITDA $275,052 $133,475
(a) We have included the results of hotels acquired in Property EBITDA
above for our period of ownership.
(b) On January 9, 2006 we closed the acquisition of a 45% joint venture
ownership interest in SHC KSL Partners, LP, the existing owner of the
Hotel del Coronado in Coronado, California (San Diego). We account
for our investment under the equity method of accounting. Our equity
in earnings of the hotel joint venture is included in equity in
earnings of joint ventures in our consolidated statements of
operations. We have included the results of this hotel in Property
EBITDA above for our period of ownership.
(c) On August 3, 2006, we purchased our joint venture partner's 65%
interest in the entity that owns the InterContinental Prague. Prior
to August 3, 2006 our equity in earnings of the hotel joint venture is
included in equity in earnings of joint ventures in our consolidated
statements of operations.
(d) We have leasehold interests in these properties. Therefore, EBITDA
represents the lease revenue less the lease expense recorded in our
statements. Property EBITDA represents the revenue less expenses
generated by the property.
SOURCE Strategic Hotels & Resorts CONTACT: |
