Three Months and Years Ended December 31, 2005 and
2004
Consolidated Statements of Operations
(in thousands, except per share data)
Three Months Ended Years Ended
December 31, December 31,
2005 2004 2005
2004
Revenues:
Rooms
$68,628 $48,705 $257,628 $248,371
Food and beverage
49,940 32,563 164,838 138,480
Other hotel operating
revenue 15,263 13,715
53,492 49,827
133,831 94,983 475,958 436,678
Lease revenue
3,294 3,314 16,787
24,233
Total revenues
137,125 98,297 492,745 460,911
Operating Costs and Expenses:
Rooms
17,862 11,433 62,730 62,772
Food and beverage
34,511 24,196 116,493 106,131
Other departmental expenses
40,069 29,180 136,559 125,803
Management fees
3,398 3,837 15,033
16,351
Other property level expenses
7,730 5,638 29,089
27,722
Lease expense
3,210 3,257 13,178
6,446
Depreciation and amortization
13,568 9,591 49,824
57,275
Corporate expenses
6,237 4,352 21,023
28,845
Total operating
costs and
expenses
126,585 91,484 443,929 431,345
Operating income
10,540 6,813 48,816
29,566
Interest expense
(8,611) (7,084) (36,142) (62,191)
Interest income
991 252 2,117
1,255
(Loss) gain on early
extinguishment of
debt
(7,572) 29 (7,572)
(20,874)
Other income, net
1,698 1,233 8,359
549
(Loss) income before income
taxes,
minority interests
and discontinued
operations (2,954) 1,243
15,578 (51,695)
Income tax benefit (expense)
1,064 (1,628) (1,298) (2,388)
Minority interests
301 83 (3,508)
1,993
(Loss) income from continuing
operations
(1,589) (302) 10,772 (52,090)
Income (loss) from discontinued
operations
17,720 (9,116) 19,488 65,423
Net income (loss)
16,131 (9,418) 30,260 13,333
Preferred shareholder
dividend (2,125)
- (6,753) -
Net income (loss) available
to
common shareholders
$14,006 $(9,418) $23,507 $13,333
Basic Income (Loss) Per
Share:
(Loss) income
from continuing
operations available to common
shareholders per share
$(0.08) $(0.01) $0.11 $(2.14)
Income (loss)
from discontinued
operations
per share
0.40 (0.30) 0.55
2.69
Net income
(loss) available to
common
shareholders per share $0.32 $(0.31)
$0.66 $0.55
Basic weighted-average
common
shares
outstanding
44,086 30,204 35,376 24,390
Diluted Income (Loss) Per
Share:
(Loss) income
from continuing
operations available to common
shareholders per share
$(0.08) $(0.08) $0.11 $(2.14)
Income (loss)
from discontinued
operations
per share
0.40 (0.23) 0.55
2.69
Net income
(loss) available to
common
shareholders per share $0.32 $(0.31)
$0.66 $0.55
Diluted weighted-average
common
shares
outstanding
44,086 39,753 35,577 24,390
December 31, 2005 and 2004
Consolidated Balance Sheets
(in thousands, except share data)
Years Ended
December 31,
2005
2004
Assets
Property and equipment
$1,300,250 $952,717
Less accumulated
depreciation
(217,695) (222,150)
Net property and equipment
1,082,555 730,567
Goodwill
66,656 66,438
Intangible assets (net
of
accumulated amortization
of $1,340
and $87, respectively)
2,129
1,613
Investment in hotel joint
venture
12,886 12,060
Cash and cash equivalents
65,017 40,071
Restricted cash and cash
equivalents
32,115 26,979
Accounts receivable (net
of
allowance for doubtful
accounts of
$427 and $361, respectively)
31,286 21,056
Deferred financing costs
(net of
accumulated amortization
of $969
and $1,420, respectively)
7,544 11,178
Other assets
122,334 80,388
Insurance recoveries receivable
25,588
-
Total assets
$1,448,110 $990,350
Liabilities and Owners' Equity
Liabilities:
Mortgages
and other debt payable
$633,380 $489,140
Bank credit
facility
26,000 54,000
Accounts payable
and accrued
expenses
90,486 58,946
Distributions
payable
11,531
8,709
Deferred fees
on management
contracts
-
2,333
Deferred gain
on sale of hotels
99,970 119,616
Total liabilities
861,367 732,744
Minority interests in SHCI's
operating partnership
76,030 61,053
Minority interests in
consolidated
hotel joint ventures
11,616
-
Owners' equity:
8.5% Series
A Cumulative Redeemable
Preferred
Shares ($0.01 par value;
4,000,000
shares issued and
outstanding;
liquidation
preference
$25.00 per share)
97,553
-
Common shares
($0.01 par value;
150,000,000
common shares
authorized;
43,878,273 and
30,035,701
common shares issued
and
outstanding, respectively)
439
300
Additional
paid-in capital
688,250 483,691
Deferred compensation
(1,916) (1,731)
Accumulated
deficit
(241,613) (271,873)
Accumulated
distributions to
shareholders
(53,142) (13,447)
Accumulated
other comprehensive
income
(loss)
9,526
(387)
Total owners' equity
499,097 196,553
Total liabilities and owners'
equity
$1,448,110 $990,350
Three Months and Years Ended December 31, 2005 and 2004
REIT Hotel Statements of Operations (a)
(in thousands, except per share data)
Three Months Ended Years Ended
December 31, December 31,
2005 2004 2005
2004
REIT Hotel Revenues:
Rooms
$68,628 $48,705 $257,628 $170,300
Food and beverage
49,940 32,563 164,838 102,633
Other hotel operating
revenue 15,263 13,715
53,492 41,135
133,831 94,983 475,958 314,068
Lease revenue (b)
3,294 3,314 16,787
20,698
REIT hotel
revenues
137,125 98,297 492,745 334,766
REIT Hotel Expenses:
Rooms
17,862 11,433 62,730 38,859
Food and beverage
34,511 24,196 116,493 76,266
Other departmental expenses
40,069 29,180 136,559 94,512
Management fees
3,398 3,837 15,033
13,431
Other property level expenses
7,730 5,638 29,089
17,953
Lease expense
3,210 3,257 13,178
6,446
REIT hotel
expenses
106,780 77,541 373,082 247,467
REIT Hotel Adjusted Operating
Income
30,345 20,756 119,663 87,299
Interest expense, net
(7,620) (6,832) (34,025) (38,698)
(Loss) gain on early
extinguishment of
debt
(7,572) 29 (7,572)
(8,211)
Other income, net (c)
448 (17) 3,359
(1,951)
Income before income taxes
and
minority interests
15,601 13,936 81,425 38,439
Income tax benefit (expense)
1,064 (1,628) (1,298) (2,388)
Minority interests (d)
301 83 (3,508)
1,993
REIT Hotel Income
16,966 12,391 76,619 38,044
REIT depreciation and amortization
(13,568) (9,591) (49,824) (37,590)
Corporate expenses
(6,237) (4,352) (21,023) (28,845)
Asset management fees related to
distributed assets (e)
1,250 1,250 5,000
2,500
Non-REIT hotel results, net
- -
- (26,199)
Income (loss) from discontinued
operations
17,720 (9,116) 19,488 65,423
Net Income (Loss)
$16,131 $(9,418) $30,260 $13,333
Three Months and Years Ended December 31, 2005 and 2004
(a) REIT hotel operating data above excludes the results
of operations of the distributed assets that are required to be included
in GAAP financial statement presentations prior to the date of the IPO
because we are deemed to have continuing involvement as a result of our
agreement to asset manage those assets. In addition, REIT hotel operating
data above also excludes the results of operations of hotels sold. As a
result, we have presented only REIT hotel operating results and a reconciliation
of REIT hotel income to net income (loss), the most directly comparable
GAAP measure.
REIT hotel operating results are presented because we
believe that it most fairly represents comparable period-to-period performance
of our hotels and facilitates comparisons with other hotel REITs and hotel
owners. Because of the elimination of the non-REIT hotel operations, the
REIT hotel operating results do not represent our total revenues, expenses
or operating profit in accordance with GAAP. These results should be considered
in combination with our GAAP financial statements by investors when evaluating
our performance.
(b) Until March 1, 2004, the Hamburg Marriott was accounted
for under the equity method. After March 1, 2004 when we acquired our joint
venture partner's 65% leasehold interest in the property, we record lease
revenue for the Hamburg Marriott. Lease revenue for the year ended December
31, 2004 includes revenues from the Hyatt Regency New Orleans until June
29, 2004 when we converted the Hyatt Regency New Orleans lease to a management
agreement. Prior to June 29, 2004, the Paris Marriott Champs Elysees was
accounted for as a finance obligation and we consolidated its results because
of a continuing involvement in supporting the financing of the property
through a collateralized guarantee. On June 29, 2004, we recorded a sale
and leaseback related to the Paris Marriott Champs Elysees. Subsequent
to June 29, 2004, we earn only lease revenue from the Hamburg Marriott
and the Paris Marriott Champs Elysees.
(c) Other income, net includes our equity in earnings
or losses of our investment in the Prague hotel joint venture for the three
months and years ended December 31, 2005 and 2004 as well as earnings or
losses from our investment in the Hamburg Marriott hotel joint venture
are included in the year ended December 31, 2004 until the acquisition
of our joint venture partner's interest in the property on March 1, 2004.
(d) There are two components to our minority interests.
First, we reflect minority interests related to the InterContinental Chicago
and Miami hotels on the balance sheet for the 15% portion of the properties
consolidated by us, but not owned by us. The $11,616,000 minority interest
balance was established based on the historical book value of the assets
at the time of the transaction. The earnings or losses from these properties
attributable to minority interests are normally reflected as minority interests
in the statements of operations; however, based on the partnership agreements
with IHG, we receive a preferred return of all the net cash flow (as defined
in the agreements) at the properties through December 31, 2005, up to a
certain threshold. The threshold was not exceeded in 2005; therefore no
earnings or losses from these properties have been reflected as adjustments
to minority interests. Second, minority interest in SHC Funding on the
consolidated balance sheets is calculated by dividing the number of units
held by the minority interests by the sum of SHCI's units and the units
held by the minority interests, all calculated based on the units outstanding
at the end of the period. Net income (loss) is allocated to minority interests
in SHC Funding based on their weighted average ownership percentages during
the period. The ownership percentage is calculated by dividing the number
of units held by the minority interests by the sum of SHCI's units and
the units held by the minority interests, all calculated based on the weighted
average days outstanding.
(e) We have an asset management agreement with SHC LLC,
under which we manage the day-to-day business of SHC LLC for an initial
annual fee of $5,000,000, payable monthly in arrears. The term of the agreement
is for five years, commenced on June 29, 2004 and will renew unless prior
written notice is given. In addition, SHC LLC has the right to terminate
the agreement if certain events occur. SHC LLC recently sold three properties
in 2005 and one property in 2006. As a result of the disposition of these
properties, the asset management fee was reduced by approximately $2.2
million annually.
December 31, 2005
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 investors
as key measures of our operating performance: Funds from Operations (FFO);
Fully Converted FFO; and Comparable FFO; Earnings Before Interest Expense,
Taxes, Depreciation and Amortization (EBITDA); and Adjusted EBITDA; and
Comparable EBITDA. Reconciliation of these measures to net income (loss)
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 that would not have certain
drawbacks associated with net income (loss) under GAAP. NAREIT defines
FFO as net income (loss) (computed in accordance with GAAP) excluding gains
or (losses) from sales of 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
Fully Converted FFO, which is FFO plus convertible debt interest expense
and minority interest expense on convertible minority interests. We also
present Comparable FFO, which is Fully Converted FFO excluding the impact
of any gains or losses on early extinguishment of debt and impairment losses.
We believe that the presentation of FFO, Fully Converted FFO and Comparable
FFO provides useful information to 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 (loss) 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
for 2005 and 2004 is presented on a full participation basis, which means
we have assumed conversion of all operating partnership minority interests
into the Company's common shares. 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 and early extinguishment
of debt and impairment losses. 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, Fully Converted FFO, 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 (loss) or operating performance.
FFO, Fully Converted FFO, 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, Fully Converted FFO, 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. 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, Fully Converted FFO, Comparable FFO, EBITDA, Adjusted EBITDA and
Comparable EBITDA to the most directly comparable GAAP financial performance
measure, which is net income (loss) available to common shareholders, and
provide an explanatory description by footnote of the items excluded from
FFO, Fully Converted FFO, EBITDA and Adjusted EBITDA. Prior year amounts
have been adjusted to conform to the current year presentation of a fully
converted basis.
Three Months and Years Ended December 31, 2005 and 2004
Reconciliation of Net Income
(Loss) Available to Common Shareholders to
EBITDA, Adjusted EBITDA and Comparable EBITDA
(in thousands)
Three Months Ended Years Ended
December 31, December 31,
2005 2004 2005
2004
Net income (loss) available to
common shareholders
$14,006 $(9,418) $23,507 $13,333
Depreciation and amortization -
continuing operations
13,568 9,591 49,824
57,275
Depreciation and amortization -
discontinued operations
- 1,062 2,782
4,188
Interest expense - continuing
operations
8,611 7,084 36,142
62,191
Interest expense - discontinued
operations
231 397 1,607
2,964
Income taxes - continuing operations
(1,064) 4,055 1,298
4,815
Mexican asset tax refund
- (2,427) -
(2,427)
Minority interests
3,057 (2,914) 7,396 (4,831)
Adjustments from unconsolidated
affiliates
1,031 1,064 4,166
5,672
Preferred shareholder dividend
2,125 -
6,753 -
EBITDA (a)
41,565 8,494 133,475 143,180
Realized portion of deferred gain
on
sale leasebacks
(1,061) (1,058) (4,355) (2,180)
Adjusted EBITDA (a)
$40,504 $7,436 $129,120 $141,000
Gain on sale of assets -
discontinued operations
(21,202) - (21,202)
(75,982)
Loss (gain) on early extinguishment
of debt - continuing operations
7,572 (29) 7,572
20,874
Loss on early extinguishment of debt
- discontinued operations
543 -
543 1,060
Impairment losses - discontinued
operations
- 12,675 -
12,675
Comparable EBITDA
$27,417 $20,082 $116,033 $99,627
(a) EBITDA and Adjusted EBITDA have
not been adjusted for the following
amounts included
in net income (loss) available to common shareholders
because these
gains (losses) have either occurred during the prior two
years or are
reasonably likely to occur within two years (in
thousands).
-- Loss (gain)
on early extinguishment of debt from continuing
operations amounted to $7,572 and $(29) for the three months ended
December 31, 2005 and 2004, respectively, and $7,572 and $20,874
for the years ended December 31, 2005 and 2004, respectively.
-- Loss on
early extinguishment of debt from discontinued operations
amounted to $543 and $0 for the three months ended December 31,
2005 and 2004, respectively, and $543 and $1,060 for years ended
December 31, 2005 and 2004, respectively.
-- Gain on
sale of assets from discontinued operations amounted to
$21,202 and $0 for the three months ended December 31, 2005 and
2004, respectively, and $21,202 and $75,982 for the years ended
December 31, 2005 and 2004, respectively.
Three Months and Years Ended December 31, 2005 and 2004
Reconciliation of Net Income (Loss) Available
to Common Shareholders to
Funds From Operations (FFO), FFO -
Fully Converted and Comparable FFO
(in thousands)
Three Months Ended Years Ended
December 31, December 31,
2005 2004 2005
2004
Net income (loss) available to common
shareholders
$14,006 $(9,418) $23,507 $13,333
Depreciation and amortization -
continuing operations
13,568 9,591 49,824 57,275
Depreciation and amortization -
discontinued operations
- 1,062 2,782 4,188
Gain on sale of assets - continuing
operations
- -
(42) -
Gain on sale of assets - discontinued
operations
(21,202) - (21,202) (75,982)
Realized portion of deferred gain
on
sale leasebacks
(1,061) (1,058) (4,355) (2,180)
Deferred tax expense on realized
portion of deferred gain
on sale leasebacks
312 335 1,307
657
Minority interests adjustments
(2,244) (2,642) (10,546) (5,573)
Adjustments from unconsolidated
affiliates
522 494 2,096
3,174
FFO (a)
3,901 (1,636) 43,371 (5,108)
Convertible debt interest
expense -
- - 4,105
Convertible minority interests
5,301 (271) 17,942
743
FFO - Fully Converted (a)
$9,202 $(1,907) $61,313 $(260)
Loss (gain) on early extinguishment
of debt - continuing operations
7,572 (29) 7,572
20,874
Loss on early extinguishment of debt
- discontinued operations
543 -
543 1,060
Impairment losses - discontinued
operations
- 12,675 -
12,675
Comparable FFO
$17,317 $10,739 $69,428 $34,349
(a) FFO and Fully Converted FFO have
not been adjusted for the following
amounts included
in net income (loss) available to common shareholders
because these
gains (losses) have either occurred during the prior two
years or are
reasonably likely to occur within two years (in
thousands).
-- Loss (gain)
on early extinguishment of debt from continuing
operations amounted to $7,572 and $(29) for the three months ended
December 31, 2005 and 2004, respectively, and $7,572 and $20,874
for the years ended December 31, 2005 and 2004, respectively.
-- Loss on
early extinguishment of debt from discontinued operations
amounted to $543 and $0 for the three months ended December 31,
2005 and 2004, respectively, and $543 and $1,060 for the years
ended December 31, 2005 and 2004, respectively.
Four Quarters Ended December 31, 2005
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; (ii) exclusion
of Marriott Schaumburg and Embassy
Suites Lake Buena Vista Resort
as these properties were sold in the
fourth quarter of 2005 and their
results of operations were reclassified
to discontinued operations;
and (iii) presentation of the European hotels
without regard to either ownership
structure or leaseholds. Acquisition
properties and the related dates
of purchase are as follows:
InterContinental Chicago and
InterContinental Miami (April 1, 2005), and
Fairmont Chicago (September
1, 2005).
United States Hotels (as of December
31, 2005)
Acquisition property revenues
- 3 Properties and 2,140 Rooms
Same store property revenues
- 7 Properties and 3,040 Rooms
Three Months Ended
March June September December
31, 30, 30,
31,
2005 2005 2005
2005 Total
Acquisition property
revenues
$- $28,664 $31,964 $44,027 $104,655
Same store property
revenues
67,237 67,093 63,468 71,883
269,681
Total revenues
$67,237 $95,757 $95,432 $115,910 $374,336
Same store seasonality %
24.9% 24.9% 23.5%
26.7% 100.0%
Mexican Hotels (as of December 31,
2005)
Same store property revenues - 2 Properties
and 380 Rooms
Three Months Ended
March June September December
31, 30, 30,
31,
2005 2005 2005
2005 Total
Same store property
revenues
$17,085 $15,990 $12,646 $15,891 $61,612
Same store seasonality %
27.7% 26.0% 20.5%
25.8% 100.0%
Total North American Hotels (as of
December 31, 2005)
Acquisition property revenues - 3
Properties and 2,140 Rooms
Same store property revenues - 9 Properties
and 3,420 Rooms
Three Months Ended
March June September December
31, 30, 30,
31,
2005 2005 2005
2005 Total
Acquisition property
revenue
$- $28,664 $31,964 $44,027 $104,655
Same store property
revenue
84,322 83,083 76,114 87,774
331,293
Total revenues
$84,322 $111,747 $108,078 $131,801 $435,948
Same store seasonality %
25.5% 25.1% 23.0%
26.4% 100.0%
European Hotels (as of December 31,
2005)
Same store property revenues - 3 Properties
and 841 Rooms
Three Months Ended
March June September December
31, 30, 30,
31,
2005 2005 2005
2005 Total
Same store property
revenues
$16,708 $23,179 $23,582 $18,923 $82,392
Same store seasonality %
20.3% 28.1% 28.6%
23.0% 100.0%
Three
Months and Years Ended December 31, 2005 and 2004
Operating Statistics by Geographic Region
Operating results have been adjusted
to show hotel performance on a
comparable period basis.
Adjustments include (i) exclusion of the seven
properties distributed out of
the Company in connection with the IPO;
(ii) exclusion of InterContinental
Chicago, InterContinental Miami and
Fairmont Chicago's partial year
results; (iii) exclusion of Ritz-Carlton
Half Moon Bay's partial year
results for the year to date analysis; (iv)
exclusion of Hyatt Regency New
Orleans due to a hurricane that ceased
significant operations in August;
(v) exclusion of Marriott Schaumburg
and Embassy Suites Lake Buena
Vista Resort as these properties were sold
in the fourth quarter of 2005
and their results of operations were
reclassified to discontinued
operations; and (vi) presentation of the
European hotels without regard
to either ownership structure or
leaseholds.
United States Hotels (as of December
31, 2005)
7 Properties
6 Properties
3,040 Rooms
2,779 Rooms
Three Months Ended
Years Ended
December 31,
December 31,
2005 2004 Change
2005 2004 Change
Average Daily
Rate
$166.70 $162.39 2.7% $156.30
$148.04 5.6%
Average Occupancy 65.8%
62.8% 3.0 pts 71.2%
68.4% 2.8 pts
RevPAR
$109.75 $101.95 7.7% $111.24
$101.32 9.8%
Total RevPAR
$242.63 $219.16 10.7% $215.81
$197.22 9.4%
Property EBITDA
Margin
18.6% 17.7% 0.9 pts
22.3% 20.9% 1.4 pts
Mexican Hotels (as of December
31, 2005)
2 Properties
2 Properties
380 Rooms
380 Rooms
Three Months Ended
Years Ended
December 31,
December 31,
2005 2004 Change
2005 2004 Change
Average Daily
Rate
$383.37 $360.35 6.4% $369.90
$349.71 5.8%
Average Occupancy 70.0%
68.7% 1.3 pts 70.4%
67.7% 2.7 pts
RevPAR
$268.22 $247.40 8.4% $260.47
$236.68 10.1%
Total RevPAR
$454.54 $430.89 5.5% $444.21
$401.11 10.7%
Property EBITDA
Margin
27.8% 32.5% (4.7)pts 30.1%
31.1% (1.0)pts
Total North American Hotels (as
of December 31, 2005)
9 Properties
8 Properties
3,420 Rooms
3,159 Rooms
Three Months Ended
Years Ended
December 31,
December 31,
2005 2004 Change
2005 2004 Change
Average Daily
Rate
$190.84 $184.95 3.2% $181.78
$171.99 5.7%
Average Occupancy 66.3%
63.4% 2.9 pts 71.1%
68.3% 2.8 pts
RevPAR
$126.47 $117.26 7.9% $129.21
$117.55 9.9%
Total RevPAR
$264.99 $241.44 9.8% $243.31
$221.67 9.8%
Property EBITDA
Margin
20.2% 20.5% (0.3)pts 24.0%
23.1% 0.9 pts
Three Months and Years Ended December 31, 2005 and 2004
European Hotels (as of December
31, 2005)
3 Properties
3 Properties
841 Rooms
841 Rooms
Three Months Ended
Years Ended
December 31,
December 31,
2005 2004 Change
2005 2004 Change
Average Daily
Rate
$206.77 $224.13 (7.7)% $238.67
$229.37 4.1%
Average
Occupancy
80.0% 79.1% 0.9 pts
80.1% 80.6% (0.5)pts
RevPAR
$165.50 $177.23 (6.6)% $191.16
$184.86 3.4%
Total RevPAR
$244.55 $258.47 (5.4)% $278.53
$259.92 7.2%
Property EBITDA
Margin
38.3% 35.8% 2.5 pts
40.6% 40.4% 0.2 pts
Years Ended December 31, 2005, 2004 and 2003
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 years ended December 31, 2005, 2004 and
2003. Property EBITDA reflects property net operating income plus depreciation
and amortization.
December 31,
2005
2004 2003
INTERCONTINENTAL CHICAGO
Selected Financial Information
(This table includes financial information
only for our period of ownership):
Total revenues
$52,164
N/A N/A
Property EBITDA
$18,299
N/A N/A
Selected Operating Information
(This table includes statistical
information only for our period
of ownership. For the full year of 2005,
average occupancy was 72.9%,
ADR was $182.50, RevPAR was $133.03 and
Total RevPAR was $207.70. For
the full year of 2004, average occupancy
was 71.5%, ADR was $166.15,
RevPAR was $118.86 and Total RevPAR was
$188.80):
Rooms
807
N/A N/A
Average occupancy
79.5%
N/A N/A
ADR
$190.46
N/A N/A
RevPAR
$151.43
N/A N/A
Total RevPAR
$235.05
N/A N/A
HYATT REGENCY PHOENIX
Selected Financial Information:
Total revenues
$36,169 $36,234
$34,392
Property EBITDA
$8,911 $10,095
$9,974
Selected Operating Information:
Rooms
696
712 712
Average occupancy
64.9% 64.7%
59.7%
ADR
$133.31 $134.37
$136.33
RevPAR
$86.58 $86.97
$81.34
Total RevPAR
$142.38 $139.04
$132.34
FAIRMONT CHICAGO
Selected Financial Information
(This table includes financial information
only for our period of ownership):
Total revenues
$22,654
N/A N/A
Property EBITDA
$6,357
N/A N/A
Selected Operating Information
(This table includes statistical
information only for our period
of ownership. For the full year of 2005,
average occupancy was 73.0%,
ADR was $189.49, RevPAR was $138.36 and
Total RevPAR was $238.43. For
the full year of 2004, average occupancy
was 67.2%, ADR was $175.20,
RevPAR was $117.75 and Total RevPAR was
$204.65):
Rooms
692
N/A N/A
Average occupancy
72.8%
N/A N/A
ADR
$213.79
N/A N/A
RevPAR
$155.63
N/A N/A
Total RevPAR
$268.63
N/A N/A
Years Ended December 31, 2005, 2004 and 2003
December 31,
2005
2004 2003
INTERCONTINENTAL MIAMI
Selected Financial Information
(This table includes financial information
only for our period of ownership):
Total revenues
$29,837
N/A N/A
Property EBITDA
$6,439
N/A N/A
Selected Operating Information
(This table includes statistical
information only for our period
of ownership. For the full year of 2005,
average occupancy was 72.0%,
ADR was $154.04, RevPAR was $110.89 and
Total RevPAR was $190.62. For
the full year of 2004, average occupancy
was 63.8%, ADR was $137.46,
RevPAR was $87.76 and Total RevPAR was
$159.21):
Rooms
641
N/A N/A
Average occupancy
67.6%
N/A N/A
ADR
$143.46
N/A N/A
RevPAR
$97.02
N/A N/A
Total RevPAR
$169.26
N/A N/A
HILTON BURBANK AIRPORT AND
CONVENTION CENTER
Selected Financial
Information:
Total revenues
$28,459 $23,227
$21,700
Property EBITDA
$8,865 $6,094
$5,730
Selected Operating Information:
Rooms
488
488 488
Average occupancy
73.7% 61.9%
61.1%
ADR
$123.26 $114.56
$112.47
RevPAR
$90.87 $70.92
$68.70
Total RevPAR
$159.77 $130.04
$121.83
MARRIOTT RANCHO LAS PALMAS
RESORT
Selected Financial Information:
Total revenues
$34,745 $32,815
$34,373
Property EBITDA
$2,511 $1,791
$3,240
Selected Operating Information:
Rooms
444
444 444
Average occupancy
67.9% 67.3%
68.0%
ADR
$151.22 $142.28
$143.66
RevPAR
$102.67 $95.74
$97.70
Total RevPAR
$214.98 $203.04
$212.68
HYATT REGENCY LA JOLLA AT AVENTINE
Selected Financial Information:
Total revenues
$38,077 $34,158
$33,280
Property EBITDA
$8,247 $6,667
$7,738
Selected Operating Information:
Rooms
419
419 419
Average occupancy
76.4% 74.2%
69.0%
ADR
$163.83 $152.57
$155.73
RevPAR
$125.10 $113.14
$107.47
Total RevPAR
$248.98 $222.74
$217.61
Years Ended December 31, 2005, 2004 and 2003
December 31,
2005
2004 2003
MARRIOTT LINCOLNSHIRE RESORT
Selected Financial Information:
Total revenues
$38,474 $36,947
$36,725
Property EBITDA
$6,259 $5,287
$5,550
Selected Operating Information:
Rooms
390
390 390
Average occupancy
66.7% 68.7%
65.6%
ADR
$121.57 $112.49
$112.95
RevPAR
$81.14 $77.23
$74.08
Total RevPAR
$271.18 $260.26
$258.70
LOEWS SANTA MONICA BEACH HOTEL
Selected Financial Information:
Total revenues
$42,784 $37,922
$33,041
Property EBITDA
$13,921 $12,076
$9,059
Selected Operating Information:
Rooms
342
342 342
Average occupancy
83.1% 79.7%
70.3%
ADR
$263.34 $244.00
$236.58
RevPAR
$218.81 $194.53
$166.22
Total RevPAR
$342.74 $302.96
$264.69
RITZ-CARLTON HALF MOON BAY
Selected Financial Information
(This table includes financial information
only for our period of ownership):
Total revenues
$50,973 $18,202
N/A
Property EBITDA
$8,508 $2,823
N/A
Selected Operating Information
(This table includes statistical
information only for our period
of ownership. For the year ended December
31, 2004, average occupancy
was 64.0%, ADR was $315.59, RevPAR was
$202.08 and Total RevPAR was
$487.33):
Rooms
261
261 N/A
Average occupancy
67.4% 67.9%
N/A
ADR
$328.99 $319.11
N/A
RevPAR
$221.71 $216.84
N/A
Total RevPAR
$535.07 $536.46
N/A
HYATT REGENCY NEW ORLEANS
Selected Financial Information
(For purposes of comparison, we have
provided financial information
for this property as if the hotel was
subject to a management agreement
(it was on a lease prior to June
2004)):
Total revenues
$40,011 $59,101
$63,143
Property EBITDA
$9,790 $16,964
$20,149
Selected Operating Information
(The number of rooms for the year ended
December 31, 2005 was calculated
using an average rate assuming no rooms
were in use for September through
December due to the hurricane):
Rooms
779 1,184
1,184
Average occupancy
59.9% 62.3%
65.0%
ADR
$139.79 $141.14
$142.75
RevPAR
$83.80 $87.92
$92.79
Total RevPAR
$140.80 $136.38
$146.11
Years Ended December 31, 2005, 2004 and 2003
December 31,
2005 2004
2003
FOUR SEASONS MEXICO CITY
Selected Financial Information:
Total revenues
$22,777 $22,274 $22,297
Property EBITDA
$4,941 $5,883
$5,550
Selected Operating Information:
Rooms
240 240
240
Average occupancy
64.7% 63.3%
63.2%
ADR
$220.72 $217.62 $216.92
RevPAR
$142.86 $137.69 $137.05
Total RevPAR
$260.01 $253.57 $254.53
FOUR SEASONS PUNTA MITA RESORT
Selected Financial Information:
Total revenues
$38,835 $33,512 $29,654
Property EBITDA
$13,623 $11,458 $9,691
Selected Operating Information:
Rooms
140 140
140
Average occupancy
80.2% 75.2%
68.0%
ADR
$576.34 $540.10 $528.85
RevPAR
$462.10 $406.39 $359.83
Total RevPAR
$759.98 $654.02 $580.31
Years Ended December 31, 2005, 2004 and 2003
December 31,
2005 2004
2003
INTERCONTINENTAL PRAGUE
Selected Financial Information
(Amounts below are 100%
of
operations, of which SHCI
owns 35%):
Total revenues
$33,609 $32,866 $28,010
Property EBITDA
$15,364 $15,028 $13,845
Selected Operating Information:
Rooms
372 372
372
Average Occupancy
80.1% 80.4%
73.5%
ADR
$198.93 $195.21 $181.39
RevPAR
$159.31 $156.87 $133.36
Total RevPAR
$247.53 $241.39 $206.29
MARRIOTT HAMBURG
Selected Financial Information
(Amounts below are 100%
of
operations, of which SHCI
owned
35% through March 2004):
Total revenues
$17,183 $17,683 $16,186
Property EBITDA
$5,005 $4,906
$4,522
Selected Operating Information:
Rooms
277 277
277
Average occupancy
78.8% 79.8%
78.7%
ADR
$146.42 $149.05 $133.00
RevPAR
$115.39 $118.93 $104.63
Total RevPAR
$169.95 $174.42 $160.09
PARIS MARRIOTT CHAMPS ELYSEES
Selected Financial Information:
Total revenues
$31,600 $29,455 $27,614
Property EBITDA
$13,091 $12,366 $11,980
Selected Operating Information:
Rooms
192 192
192
Average occupancy
82.0% 82.2%
82.0%
ADR
$441.84 $406.54 $384.07
RevPAR
$362.18 $334.19 $315.12
Total RevPAR
$450.91 $419.16 $394.04
Years Ended December 31, 2005, 2004 and 2003
Reconciliation of Property EBITDA to EBITDA
(in thousands)
Years Ended December 31,
2005
2004
2003
Property Property
Property
Hotel
EBITDA EBITDA EBITDA EBITDA
EBITDA EBITDA
Hyatt Regency
New Orleans
$9,790 $9,790 $16,964 $16,964
$20,149 $20,149
InterContinental
Chicago (a)
18,299 18,299 -
- -
-
Hyatt Regency
Phoenix
8,911 8,911 10,095
10,095 9,974 9,974
Fairmont
Chicago (b)
6,357 6,357
- -
- -
InterContinental
Miami (a)
6,439 6,439
- -
- -
Hilton Burbank
Airport and
Convention Center 8,865
8,865 6,094 6,094
5,730 5,730
Marriott Rancho
Las Palmas Resort 2,511
2,511 1,791 1,791
3,240 3,240
Hyatt Regency
La Jolla at
Aventine
8,247 8,247 6,667
6,667 7,738 7,738
Marriott
Lincolnshire
Resort
6,259 6,259 5,287
5,287 5,550 5,550
Loews Santa Monica
Beach Hotel
13,921 13,921 12,076 12,076
9,059 9,059
Ritz-Carlton Half
Moon Bay (c)
8,508 8,508 2,823
2,823 -
-
Four Seasons
Mexico City
4,941 4,941 5,883
5,883 5,550 5,550
Four Seasons Punta
Mita Resort
13,623 13,623 11,458 11,458
9,691 9,691
InterContinental
Prague (d)
15,364 -
15,028 - 13,845
-
Marriott
Hamburg (e)
5,005 135 4,906
1,455 4,522 -
Paris Marriott
Champs
Elysees (f)
13,091 2,888 12,366
6,931 11,980 11,713
$150,131 $119,694 $111,438 $87,524 $107,028
$88,394
Adjustments:
Distributed
Property EBITDA
(see note on
page 7)
$ -
$28,387
$55,149
Corporate expenses
(21,023) (28,845)
(21,912)
Interest income
2,117
1,255
2,606
Loss on early
extinguishment of debt
(7,572) (20,874)
(13,121)
Other income
(expenses), net
8,359
549
(7,581)
Income taxes
-
2,427
551
Mexican asset
tax refund
-
(2,427)
-
Income from
discontinued
operations
(excluding minority
interest)
23,376
62,585
25,432
Depreciation and
amortization
- discontinued
operations
2,782
4,188
9,414
Interest expense
- discontinued
operations
1,607
2,964
9,684
Adjustments from
unconsolidated
affiliates
4,166
5,672
3,165
Other adjustments
(31)
(225)
-
EBITDA
$133,475 $143,180
$151,781
(a) On April 1, 2005, we purchased
an 85% controlling interest in the
joint ventures that own the InterContinental
Chicago and Miami hotels. We
consolidate these hotels for reporting
purposes. We have included the
results of this hotel in Property
EBITDA above for our period of
ownership.
(b) On September 1, 2005, we purchased
the Fairmont Chicago for
$158.0 million. We have included
the results of this hotel in Property
EBITDA above for our period of ownership.
(c) On August 24, 2004, we purchased
the Ritz-Carlton Half Moon Bay for
$123.2 million. We have included
the results of this hotel in Property
EBITDA above for our period of ownership.
(d) We have a 35% interest in the joint
venture that owns the
InterContinental Prague and account
for our investment under the equity
method of accounting. Our equity
in earnings of the hotel joint venture
is included in other income (expenses),
net in our consolidated statements
of operations.
(e) On March 1, 2004, we acquired the
65% interest we did not previously
own in the joint venture that leases
the Hamburg Marriott. On June 29,
2004, we eliminated the collateralized
guarantee on the sale leaseback
related to the property and no longer
treat the transaction as a
financing. Accordingly, a sale of
the Hamburg Marriott was recorded and
the leaseback has now been recorded
as an operating lease as of June 29,
2004. We eliminated the
finance obligation on the consolidated balance
sheet and now records lease expense
instead of mortgage interest and
depreciation expense.
(f) On June 29, 2004, we eliminated
the collateralized guarantee related
to the Paris Marriott Champs Elysees
and no longer treat the transaction
as a financing. Accordingly, a sale
of the Paris Marriott Champs Elysees
was recorded and the leaseback has
now been recorded as an operating lease
as of June 29, 2004. We
eliminated the finance obligation on the
consolidated balance sheet and now
records lease expense instead of
mortgage interest and depreciation
expense. |