WHITE PLAINS, N.Y.--(BUSINESS WIRE)--Starwood
Hotels &
Resorts Worldwide, Inc. (NYSE: HOT)
today reported strong fourth quarter 2006 financial results, driven by
double-digit worldwide REVPAR increases and higher operating margins.
Fourth Quarter 2006 Highlights
- Excluding special items, EPS from continuing operations was
$0.92
compared
to $0.71 for the fourth quarter of 2005. Including special items, EPS
from
continuing operations was $0.94 compared to $0.70 in the fourth quarter
of 2005.
- Worldwide System-wide REVPAR for Same-Store Hotels
increased 11.4%
compared
to the fourth quarter of 2005. System-wide REVPAR for Same-Store Hotels
in North America increased 9.1% compared to the fourth quarter of 2005.
- Worldwide REVPAR for Starwood branded Same-Store Owned
Hotels increased
11.7% compared to the fourth quarter of 2005. REVPAR for Starwood
branded
Same-Store Owned Hotels in North America increased 8.6% compared to the
fourth quarter of 2005.
- Margins at Starwood branded Same-Store Owned Hotels
Worldwide and in
North
America improved 280 and 153 basis points, respectively, as compared to
the fourth quarter of 2005.
- Management and franchise revenues increased 54.8% over
2005, including
revenues from the Le Meridien hotels and the hotels sold to Host.
- The Company signed 61 hotel management and franchise
contracts in the
quarter
(representing approximately 12,500 rooms). For the full year, the
Company
signed 156 hotel management and franchise contracts (representing
approximately
36,700 rooms).
- Excluding residential sales, contract sales at vacation
ownership
properties
increased 15.0% over 2005. Reported revenues from vacation ownership
and
residential sales increased $130 million when compared to 2005. Strong
increases in revenues from vacation ownership sales were partially
offset
by a decline in residential sales.
- Excluding special items, income from continuing operations
was $199
million
compared to $162 million in the same period of 2005. Net income,
including
special items, was $203 million compared to $159 million in the fourth
quarter of 2005.
- Total Company Adjusted EBITDA was $383 million when
compared to $391
million
in 2005. The year over year reduction is due to the sale of 50 hotels
since
the beginning of the fourth quarter of 2005 and stock based
compensation
expense, offset in part by increases in management and franchise
revenues.
- During the fourth quarter, the Company repurchased
approximately 0.6
million
shares at a cost of $34.2 million. For the full year, the Company
repurchased
21.7 million shares at a cost of $1.263 billion.
Starwood Hotels & Resorts Worldwide, Inc. ("Starwood" or the
"Company")
today reported EPS from continuing operations for the fourth quarter of
2006 of $0.94 compared to $0.70 in the fourth quarter of 2005.
Excluding
special items, EPS from continuing operations was $0.92 for the fourth
quarter of 2006 compared to $0.71 in the fourth quarter of 2005.
Excluding
special items, the effective income tax rate in the fourth quarter of
2006
was 21.4% including a $19 million benefit resulting from the
recognition
of certain tax credits related to 2005.
Income from continuing operations was $203 million in the
fourth quarter
of 2006 compared to $159 million in 2005. Excluding special items,
which
net to a $4 million benefit in 2006, income from continuing operations
was $199 million for the fourth quarter of 2006 compared to $162
million
in 2005.
Net income was $203 million and EPS was $0.93 in the fourth
quarter
of 2006 compared to net income of $159 million and EPS of $0.70 in the
fourth quarter of 2005.
Steven J. Heyer, CEO, said, "I am extremely proud of what
Starwood accomplished
this year and am even more excited about our positioning for 2007. With
our fee business now the largest contributor to our bottom line, our
broad
global presence, our industry-leading pipeline, and our significant
brand
initiatives throughout 2006, we are transforming from a cyclical real
estate
business into a leading global lifestyle brand company. We emerged from
2006 with the right asset mix, a clear strategy, focus, process and
discipline.
By any measure, it is clear our new model has been paying off. Today,
Starwood
is a higher-growth, more capital-efficient, cash-rich and less-cyclical
business."
Heyer continued: "Fourth quarter results were impressive,
beating our
guidance. While North America branded REVPAR at Same-Store Owned Hotels
increased at the high end of our guidance, up 8.6%, Worldwide REVPAR
jumped
11.7%. Importantly, this REVPAR growth had great flow-through at these
hotels, driving North American and Worldwide margin increases of over
150
basis points and 280 basis points, respectively. Worldwide System-wide
REVPAR increased 11.4% and managed and franchised revenues increased
54.8%
in the quarter.
Our pipeline's upward trajectory is a testament to the
strength of our
branding initiatives, our development focus, and our emphasis on
building
relationships with the best development partners in the world. We
signed
156 new long-term hotel contracts this year, the most in our history,
and
according to December 2006 Smith Travel data, our brands emerged as #1
overall in the upper-upscale and luxury development market, with 38% of
the hotels and rooms in the pipeline today. This represents strong
growth
on an absolute basis, and significant market share gains. We have a
leading
position in the upper-upscale and luxury segments, and our global
development
group and brand teams are working to extend this lead.
Revenues at our timeshare division grew 13% year over year,
and we expect
our St Regis, Westin and Sheraton brands to continue driving strong
growth
in this under-penetrated business. Contract sales were up 15% in the
quarter
due to the combination of higher pricing and additional units sold.
We fully expect 2007 to be another great year for our company
and we
remain focused on our strategic initiatives - service excellence, brand
development, pipeline development, vacation ownership growth, real
estate
development and repositionings. We believe that these initiatives will
allow us to outperform the competition and continue to create value for
our shareholders."
Operating Results
Fourth Quarter Ended December 31, 2006
Management and Franchise Revenues
Worldwide System-wide (owned, managed and franchised) REVPAR
for Same-Store
Hotels increased 11.4% compared to the fourth quarter of 2005 including
24.8% in Africa & the Middle East, 17.0% in Europe, 12.5% in Latin
America, 11.2% in Asia Pacific and 9.1% in North America. The 9.1%
increase
in System-wide REVPAR for Same-Store Hotels in North America by brand
was:
St. Regis/Luxury Collection 15.7%, W Hotels 13.5%, Westin 9.8% and
Sheraton
7.7%.
Management fees, franchise fees and other income were $209
million,
up $57 million, or 37.5%, from the fourth quarter of 2005. Management
fees
grew 57.4% to $107 million and franchise fees grew 34.8% to $31
million.
The increases are related to the addition of new hotels (including Le
Meridien
hotels and the hotels sold to third parties, including Host Hotels
&
Resorts, Inc. ("Host")), and growth in REVPAR of existing hotels under
management, offset in part by fees associated with hotels that left the
system.
The hotels sold to Host contributed $28 million, and the Le
Meridien
hotels added $16 million, respectively, of management and franchise
revenues
during the fourth quarter of 2006. The Le Meridien hotels contributed
$5
million in the same quarter of 2005 as the Company acquired that
business
at the end of November of 2005. Excluding the hotels sold to Host, and
fees from Le Meridien, management and franchise revenues increased
18.2%
in the fourth quarter of 2006 when compared to 2005. Worldwide Le
Meridien
hotels that were in operation during both periods had REVPAR growth of
21.8% in the fourth quarter of 2006 when compared to 2005 with ADR
increasing
16.8% and occupancy increasing 290 basis points.
During the fourth quarter of 2006, the Company signed 61 hotel
management
and franchise contracts (representing approximately 12,500 rooms: 15
Sheraton,
15 aloft, 11 Four Points by Sheraton, 9 Westin, 3 W Hotels, 2 Le
Meridien,
2 Luxury Collection, 2 St. Regis, and 2 Element). Of the hotels signed
in the quarter, 46 were new builds and 15 were conversions from other
brands.
For the full year, the Company signed 156 hotel management and
franchise
contracts (representing approximately 36,700 rooms). The Company now
has
roughly 400 hotels in the active pipeline and almost 100,000 rooms at
December
31, 2006, driven by strong interest in all Starwood brands.
Approximately
half of the pipeline is in international locations.
During the fourth quarter of 2006, 18 new hotels and resorts
(representing
approximately 4,400 rooms) entered the system, including The Westin
Chicago
North Shore (Wheeling, Illinois, 411 rooms), The U.S. Grant (San Diego,
California, 270 rooms) and The Westin St. Maarten, Dawn Beach Resort
&
Spa (St. Maarten, Netherland Antilles, 416 rooms). Eight properties
(representing
approximately 1,700 rooms) were removed from the system during the
quarter.
The Company expects to open more than 80 hotels (representing
approximately
20,000 rooms) in 2007 and is targeting signing approximately 200 hotel
management and franchise contracts in 2007.
Owned, Leased and Consolidated Joint Venture Hotels
Worldwide REVPAR for Starwood branded Same-Store Owned Hotels
increased
11.7%. REVPAR at Starwood branded Same-Store Owned Hotels in North
America
increased 8.6%. REVPAR growth was particularly strong at the Company's
owned hotels in Chicago, New York, Phoenix, and San Diego.
Internationally,
Starwood branded Same-Store Owned Hotel REVPAR increased 12.5%
excluding
the impact of foreign exchange, and as reported, in US dollars, branded
Same-Store Owned Hotel REVPAR increased 17.5%.
Revenues at Starwood branded Same-Store Owned Hotels in North
America
increased 8.3% while costs and expenses increased 6.1% when compared to
2005. Margins at these hotels increased 153 basis points.
Revenues at Starwood branded Same-Store Owned Hotels Worldwide
increased
10.6% while costs and expenses increased 6.5% when compared to 2005.
Margins
at these hotels increased 280 basis points.
Reported revenues at owned, leased and consolidated joint
venture hotels
were $602 million when compared to $894 million in 2005. Reported
revenues
and operating income were impacted by the sale of 50 hotels since the
beginning
of the fourth quarter of 2005. These hotels had $2 million of revenues
and $1 million of expenses (before depreciation) in 2006 as compared to
$358 million of revenues and $254 million of expenses (before
depreciation)
in the same quarter of 2005.
Vacation Ownership
While contract sales of vacation ownership intervals were up
15.0%,
total vacation ownership reported revenues increased 108.1% to $310
million
when compared to 2005 due primarily to the timing of the recognition of
deferred revenues under percentage of completion accounting for
pre-sales
at projects under construction. The average price per vacation
ownership
unit sold increased 11.2% to approximately $27,000, and the number of
contracts
signed increased 3.5% when compared to 2005.
During the fourth quarter of 2006, the Company was actively
selling
vacation ownership interests at 15 resorts. Starwood Vacation Ownership
is also in the predevelopment phase of several other new vacation
ownership
resorts in California, Colorado, Hawaii, Mexico and Aruba.
During the fourth quarter of 2006, the Company sold
approximately $133
million of vacation ownership notes receivable and recognized gains of
$17 million as compared to gains of $25 million in the same period of
2005.
Residential
During the fourth quarter of 2006, the Company recognized
residential
revenues of approximately $12 million primarily from sales at the St.
Regis
in New York. To date, the Company has recognized approximately $40.7
million
in revenues from the sale of condominiums at the St. Regis in New York.
In the fourth quarter of 2005, the Company recognized residential
revenues
of $43.0 million primarily associated with sales at the St. Regis
Museum
Tower in San Francisco which sold out in the first half of 2006.
Selling, General, Administrative and Other
Selling, general, administrative and other expenses increased
33.3%
to $128 million compared to the fourth quarter of 2005. Approximately
one-third
of the increase is due to the impact of stock-based compensation,
including
stock option expense. The remaining increase includes investments in
our
global development capability, and costs associated with the launch of
the Company's new brands, aloft and Element, as well as the addition of
the Le Meridien business.
Asset Sales
During the fourth quarter of 2006, the Company sold two
wholly-owned
hotels for cash proceeds of approximately $29 million. Additionally,
the
Company received proceeds of approximately $20 million from the sales
of
two unconsolidated joint ventures in the fourth quarter of 2006.
Capital
Gross capital spending during the quarter included
approximately $55
million in renovations of hotel assets including construction capital
at
the Sheraton Centre Toronto Hotel, the Westin Cancun Resort & Spa,
and the Westin Maui Resort. Investment spending on gross vacation
ownership
interest ("VOI") inventory was $107 million, which was offset by cost
of
sales of $74 million associated with VOI sales during the quarter. The
inventory spend included VOI construction at the Westin Ka'anapali
Ocean
Resort Villas North in Maui, the Westin Princeville Resort in Kauai,
the
Westin Kierland Resort in Arizona, Sheraton's Vistana Villages in
Orlando,
and the Westin Lagunamar Resort in Cancun.
Share Repurchase
During the fourth quarter of 2006, the Company repurchased
approximately
0.6 million shares at a total cost of approximately $34.2 million.
Since
January 1, 2006, the Company has returned more than $4.3 billion to
shareholders,
including $2.8 billion in connection with the sale of 33 hotels to
Host,
approximately $1.263 billion for the repurchase of approximately 21.7
million
shares of its stock and $276 million in dividends. At December 31,
2006,
approximately $380 million remained available under the Company's share
repurchase authorization. Starwood had approximately 214 million shares
outstanding (including partnership units) at December 31, 2006.
Dividend
The Company's former REIT subsidiary paid dividends of $0.21
per share
for each of the first and second quarters of 2006. The remaining 2006
dividend
of $0.42 per share was declared by the Board of Directors in December
2006
and paid by the Company on January 19, 2007.
Balance Sheet
At December 31, 2006, the Company had total debt of $2.632
billion and
cash and cash equivalents (including $336 million of restricted cash)
of
$519 million, or net debt of $2.113 billion, compared to net debt of
$2.437
billion at the end of the third quarter of 2006.
At December 31, 2006, debt was approximately 67% fixed rate
and 33%
floating rate and its weighted average maturity was 4.4 years with a
weighted
average interest rate of 6.97%. The Company had cash (including total
restricted
cash) and availability under domestic and international revolving
credit
facilities of approximately $1.867 billion.
Results for the Twelve Months Ended December 31, 2006
EPS from continuing operations increased to $5.01 compared to
$1.88
in 2005. Excluding special items, EPS from continuing operations was
$2.73
compared to $2.34 in 2005. Excluding special items, income from
continuing
operations was $607 million compared to $526 million in 2005. Net
income
was $1.043 billion and EPS was $4.69 compared to $422 million and
$1.88,
respectively, in 2005. Total Company Adjusted EBITDA, which was
significantly
impacted by the sale of 56 hotels since the beginning of 2005, was
$1.309
billion compared to $1.417 billion in 2005.
Outlook
The Company's 2007 Guidance assumes the following changes
since we last
provided guidance:
- The sale of two unconsolidated joint ventures in the fourth
quarter of
2006
- The expected sale of 14 owned hotels and 8 hotels in
unconsolidated
joint
ventures in 2007 with anticipated gross proceeds of $475 million to
$500
million. Most sales are expected to be completed in the first half of
2007.
For the Full year 2007:
Adjusted EBITDA is expected to be
approximately $1.365
billion prior to
anticipated asset sales. Adjusting for the asset sales mentioned above,
2007 Adjusted EBITDA is expected to be approximately $1.335 billion,
assuming:
-- REVPAR growth at Company operated (Owned and Managed)
hotels worldwide of 8% to 10%
-- REVPAR growth at Same-Store Owned Hotels in North America
of 7% to 9%
-- North America Same-Store Owned Hotel EBITDA growth of 12%
to 14% with margin improvement of 100 to 150 basis points
at these hotels
-- Growth from management and franchise revenues of
approximately 17% to 19% including revenues earned from the
hotels sold to Host, and 13% to 15% excluding the hotels
sold to Host
-- An increase in operating income from our vacation ownership
and residential business of $45 to $55 million (including
gains on sale of vacation ownership notes receivable)
- Income from continuing operations, before special items, is
expected to
be approximately $543 million reflecting an effective tax rate of
approximately
33%.
- EPS before special items is expected to be approximately
$2.50
- Full year capital expenditures (excluding timeshare
inventory) would be
approximately $650 million, including $300 million for maintenance,
renovation
and technology and $350 million for other growth initiatives, including
the Bal Harbour project. Additionally, net capital expenditures for
timeshare
inventory would be approximately $150 million.
- Full year depreciation and amortization expense would be
approximately
$340 million
- Full year cash interest expense would be approximately $184
million and
cash taxes of approximately $240 million.
Reconciliation to reflect the sale of assets completed in Q4 2006 and
assets expected to be sold in 2007
(in millions)
2007 Adjusted EBITDA Guidance $1,365
Adjustments to estimate the sale of 14 owned hotels sold
in Q4 2006 or expected to be sold in 2007
Less: Revenues from hotels sold in Q4 2006 or expected
to be sold in 2007 (94)
Add: Expenses from hotels sold in Q4 2006 or expected
to be sold in 2007 73
Add: Expected fees from hotels sold or expected to be
sold encumbered by management or franchise contracts 2
Adjustments to estimate the sale of 10 JV assets sold in
Q4 2006 or expected to be sold in 2007
Less: Earnings from unconsolidated JV hotels sold or
expected to be sold (11)
-------------
2007 Adjusted EBITDA Guidance to reflect asset sales $1,335
=============
For the three months ended March 31, 2007:
Adjusted EBITDA is
expected to be $255 million assuming:
-- REVPAR growth at Company operated (Owned and Managed)
hotels worldwide of 8% to 10%
-- REVPAR growth at Same-Store Owned Hotels in North America
of 8% to 10%
-- North America Same-Store Owned Hotel EBITDA growth of 13%
to 15% with margin improvement of 100 to 150 basis points
at these hotels
-- Growth from management and franchise revenues of
approximately 35% to 40% including revenues earned from
the hotels sold to Host, and 13% to 15% excluding the
hotels sold to Host
-- An increase in operating income from our vacation
ownership and residential business of $15 to $20 million
- Income from continuing operations, before special items, is
expected to
be approximately $83 million reflecting an effective tax rate of
approximately
33%.
- EPS before special items is expected to be approximately
$0.38.
Special Items
The Company recorded net credits of $4 million (after-tax) for
special
items in the fourth quarter of 2006 compared to $3 million of net
charges
(after-tax) in the same period of 2005.
Special items in the fourth quarter of 2006 primarily relate
to restructuring
and other special charges, and additional one-time income tax benefits
realized in connection with the Host transaction.
The following represents a reconciliation of income from
continuing
operations before special items to income from continuing operations
after
special items (in millions, except per share data):
Three Months Ended Year Ended
December 31, December 31,
------------------ ---------------
2006 2005 2006 2005
-------- --------- ------- -------
Income from continuing operations
$199 $162 before special items $607 $526
-------- --------- ------- -------
$0.92 $0.71 EPS before special items $2.73 $2.34
-------- --------- ------- -------
Special Items
Restructuring and other special
(9) (13) charges, net (a) (20) (13)
-- -- Debt defeasance costs (b) (37) --
-- -- Debt extinguishment costs (c) (7) --
(Loss) gain on asset dispositions
(4) 2 and impairments, net (d) (3) (30)
-------- --------- ------- -------
(13) (11) Total special items - pre-tax (67) (43)
Income tax benefit for special
7 5 items (e) 28 16
Income tax benefits related to the
10 -- transaction with Host (f) 524 --
Tax expense and repatriation of
-- -- foreign earnings -- (47)
Reserves and credits associated
-- 3 with tax matters (g) 23 (29)
-------- --------- ------- -------
4 (3) Total special items - after-tax 508 (103)
-------- --------- ------- -------
$203 $159 Income from continuing operations $1,115 $423
-------- --------- ------- -------
$0.94 $0.70 EPS including special items $5.01 $1.88
======== ========= ======= =======
(a) During the three months ended December 31, 2006, the loss is
primarily related to severance costs related to certain executives
and transition costs associated with the Le Meridien transaction. For
the twelve months ended December 31, 2006, the charge includes
additional Le Meridien transition costs offset, in part, by the
reversal of ITT acquisition reserves. During 2005, the Company
recorded $13 million primarily related to severance costs in
connection with the Company's restructuring as a result of its
planned disposition of significant real estate assets and Le Meridien
transition costs.
(b) During the three months ended March 31, 2006, the Company
completed two transactions whereby it was released from certain debt
obligations that allowed Starwood to sell certain hotels that
previously served as collateral for such debt. The Company incurred
expenses totaling $37 million in connection with the early
extinguishment of these debt obligations. These expenses are
reflected in interest expense in the Company's consolidated statement
of income.
(c) During the three months ended June 30, 2006, the Company incurred
costs of approximately $7 million related to the early extinguishment
of $150 million of debentures issued by its former subsidiary,
Sheraton Holding Corporation. These expenses are reflected in
interest expense in the Company's consolidated statement of income.
(d) For the three months ended December 31, 2006, primarily reflects
$20 million in losses recognized in connection with the impairment of
two properties, one of which is expected to be demolished and rebuilt
under the aloft and Element brands and another which represents land
that was sold to a developer who plans to build a Starwood hotel,
partially offset by a $16 million gain on the sale of the Company's
interest in a joint venture. For the twelve months ended December 31,
2006, the balance also includes losses and impairment charges of
approximately $54 million on the sale of hotels offset by gains on
the sale of hotels and joint ventures and insurance proceeds of
approximately $55 million. The three months ended December 31, 2005
reflect gains recorded on 3 hotel sales and the loss for the twelve
months ended December 31, 2005 is related to losses on the sale or
impairment of hotels.
(e) Represents taxes on special items at the Company's incremental tax
rate.
(f) Primarily relates to a deferred tax asset recognized on the
deferred gain and other one-time tax benefits realized in connection
with the Host sale.
(g) Income tax benefit for the year ended December 31, 2006 primarily
relates to the reversal of tax reserves no longer deemed necessary as
the related contingencies have been resolved. Income tax expense in
the three and twelve months ended December 31, 2005 is due to
increases in tax reserves related to the Company's 1998 disposition
of the World Directories business, offset by tax refunds related to
the 1995 split-up of ITT Corporation.
The Company has included the above supplemental information concerning
special items to assist investors in analyzing Starwood's financial
position
and results of operations. The Company has chosen to provide this
information
to investors to enable them to perform meaningful comparisons of past,
present and future operating results and as a means to emphasize the
results
of core on-going operations.
Starwood will be conducting a conference call to discuss the
fourth
quarter financial results at 10:30 a.m. (EST) today at (719) 457-2698.
The conference call will be available through simultaneous webcast in
the
Investor Relations/Press Releases section of the Company's website at http://www.starwoodhotels.com.
A replay of the conference call will also be available from 12:30 p.m.
(EST) today through Thursday, February 8 at 12:00 midnight (EST) on
both
the Company's website and via telephone replay at (719) 457-0820
(access
code 4726733).
Definitions
All references to EPS, unless otherwise noted, reflect
earnings per
diluted share from continuing operations. All references to "net
capital
expenditures" mean gross capital expenditures for timeshare and
fractional
inventory net of cost of sales. EBITDA represents net income before
interest
expense, taxes, depreciation and amortization. The Company believes
that
EBITDA is a useful measure of the Company's operating performance due
to
the significance of the Company's long-lived assets and level of
indebtedness.
EBITDA is a commonly used measure of performance in its industry which,
when considered with GAAP measures, the Company believes gives a more
complete
understanding of the Company's operating performance. It also
facilitates
comparisons between the Company and its competitors. The Company's
management
has historically adjusted EBITDA (i.e., "Adjusted EBITDA") when
evaluating
operating performance for the total Company as well as for individual
properties
or groups of properties because the Company believes that the inclusion
or exclusion of certain recurring and non-recurring items, such as
revenues
and costs and expenses from hotels sold, restructuring and other
special
charges and gains and losses on asset dispositions and impairments, is
necessary to provide the most accurate measure of core operating
results
and as a means to evaluate comparative results. The Company's
management
also uses Adjusted EBITDA as a measure in determining the value of
acquisitions
and dispositions and it is used in the annual budget process. Due to
guidance
from the Securities and Exchange Commission, the Company now does not
reflect
such items when calculating EBITDA; however, the Company continues to
adjust
for these special items and refers to this measure as Adjusted EBITDA.
The Company has historically reported this measure to its investors and
believes that the continued inclusion of Adjusted EBITDA provides
consistency
in its financial reporting and enables investors to perform more
meaningful
comparisons of past, present and future operating results and provides
a means to evaluate the results of its core on-going operations. EBITDA
and Adjusted EBITDA are not intended to represent cash flow from
operations
as defined by GAAP and such metrics should not be considered as an
alternative
to net income, cash flow from operations or any other performance
measure
prescribed by GAAP. The Company's calculation of EBITDA and Adjusted
EBITDA
may be different from the calculations used by other companies and,
therefore,
comparability may be limited.
All references to Same-Store Owned Hotels reflect the
Company's owned,
leased and consolidated joint venture hotels, excluding hotels sold to
date, undergoing significant repositionings or for which comparable
results
are not available (i.e., hotels not owned during the entire periods
presented
or closed due to seasonality or hurricane damage). REVPAR is defined as
revenue per available room. ADR is defined as average daily rate.
All references to contract sales or originated sales reflect
vacation
ownership sales before revenue adjustments for percentage of completion
accounting methodology.
All references to management and franchise revenues represent
base and
incentive fees, franchise fees, amortization of deferred gains
resulting
from the sales of hotels subject to long-term management contracts and
termination fees offset by payments by Starwood under performance and
other
guarantees.
Starwood Hotels & Resorts Worldwide, Inc. is one of the
leading
hotel and leisure companies in the world with approximately 870
properties
in more than 100 countries and 145,000 employees at its owned and
managed
properties. Starwood® Hotels is a fully integrated owner, operator and
franchisor of hotels and resorts with the following internationally
renowned
brands: St. Regis®, The Luxury Collection®, W®, Westin®, Le Meridien®,
Sheraton®, Four Points® by Sheraton, aloft(SM), and Element(SM).
Starwood
Hotels also owns Starwood Vacation Ownership, Inc., one of the premier
developers and operators of high quality vacation interval ownership
resorts.
For more information, please visit www.starwoodhotels.com.
** Please contact Starwood's new, toll-free media hotline at
(866) 4-STAR-PR (866-478-2777)
for photography or additional information.**
Note: This press release contains forward-looking statements within the
meaning of federal securities regulations. Forward-looking statements
are
not guarantees of future performance and involve risks and
uncertainties
and other factors that may cause actual results to differ materially
from
those anticipated at the time the forward-looking statements are made.
Further results, performance and achievements may be affected by
general
economic conditions including the impact of war and terrorist activity,
business and financing conditions, foreign exchange fluctuations,
cyclicality
of the real estate (including residential) and the hotel and vacation
ownership
businesses, operating risks associated with the hotel, vacation
ownership
and residential businesses, relationships with associates and labor
unions,
customers and property owners, the impact of the internet reservation
channels,
our reliance on technology, domestic and international political and
geopolitical
conditions, competition, governmental and regulatory actions (including
the impact of changes in U.S. and foreign tax laws and their
interpretation),
travelers' fears of exposure to contagious diseases, risk associated
with
the level of our indebtedness, risk associated with potential
acquisitions
and dispositions, and the introduction of new brand concepts and other
risks and uncertainties. These risks and uncertainties are presented in
detail in our filings with the Securities and Exchange Commission.
Future
vacation ownership units indicated in this press release include
planned
units on land owned by the Company or by joint ventures in which the
Company
has an interest that have received all major governmental land use
approvals
for the development of vacation ownership resorts. There can be no
assurance
that such units will in fact be developed and, if developed, the time
period
of such development (which may be more than several years in the
future).
Some of the projects may require additional third-party approvals or
permits
for development and build out and may also be subject to legal
challenges
as well as a commitment of capital by the Company. The actual number of
units to be constructed may be significantly lower than the number of
future
units indicated. Although we believe the expectations reflected in such
forward-looking statements are based upon reasonable assumptions, we
can
give no assurance that our expectations will be attained or that
results
will not materially differ. We undertake no obligation to publicly
update
or revise any forward-looking statement, whether as a result of new
information,
future events or otherwise.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per Share data)
Three Months Ended Year Ended
December 31, December 31,
------------------------- ------------------------
% %
2006 2005 Variance 2006 2005 Variance
------- -------- -------- ------- ------- --------
Revenues
Owned, leased and
consolidated joint
$602 $894 (32.7) venture hotels $2,692 $3,517 (23.5)
Vacation ownership
and residential
sales and
322 192 67.7 services(a) 1,005 889 13.0
Management fees,
franchise fees and
209 152 37.5 other income 697 501 39.1
Other revenues from
managed and
franchised
439 278 57.9 properties (b) 1,585 1,070 48.1
------- -------- -------- ------- ------- --------
1,572 1,516 3.7 5,979 5,977 0.0
Costs and Expenses
Owned, leased and
consolidated joint
448 672 33.3 venture hotels 2,023 2,634 23.2
Vacation ownership
204 158 (29.1) and residential 736 661 (11.3)
Selling, general,
administrative and
128 96 (33.3) other 470 370 (27.0)
Restructuring and
other special
9 13 30.8 charges, net 20 13 (53.8)
70 82 14.6 Depreciation 280 387 27.6
5 7 28.6 Amortization 26 20 (30.0)
Other expenses from
managed and
franchised
439 278 (57.9) properties (b) 1,585 1,070 (48.1)
------- -------- -------- ------- ------- --------
1,303 1,306 0.2 5,140 5,155 0.3
269 210 28.1 Operating income 839 822 2.1
Gain on sale of VOI
-- 25 (100.0) notes receivable -- 25 (100.0)
Equity earnings and
gains and losses
from unconsolidated
15 24 (37.5) ventures, net 61 64 (4.7)
Interest expense,
net of interest
income of $3, $8,
(40) (58) 31.0 $29 and $19 (215) (239) 10.0
(Loss) gain on asset
dispositions and
(4) 2 n/m impairments, net (3) (30) 90.0
------- -------- -------- ------- ------- --------
Income from
continuing
operations before
taxes and minority
240 203 18.2 equity 682 642 6.2
Income tax (expense)
(36) (44) n/m benefit 434 (219) n/m
Minority equity in
(1) -- n/m net income (1) -- n/m
------- -------- -------- ------- ------- --------
Income from
continuing
203 159 n/m operations 1,115 423 n/m
Discontinued
Operations:
Loss from
-- -- -- operations -- (1) n/m
Net loss on
(2) -- n/m dispositions ( (2) -- n/m
Cumulative effect of
2 -- n/m accounting change ( (70) -- n/m
------- -------- -------- ------- ------- --------
$203 $159 n/m Net income $1,043 $422 n/m
======= ======== ======== ======= ======= ========
Earnings (Loss) Per
Share - Basic
Continuing
$0.98 $0.72 n/m operations $5.25 $1.95 n/m
Discontinued
(0.01) -- n/m operations (0.01) -- n/m
Cumulative effect of
-- -- -- accounting change (0.33) -- n/m
-------- -------- ------- ------- --------
$0.97 $0.72 n/m Net income $4.91 $1.95 n/m
======= ======== ======== ======= ======= ========
Earnings (Loss) Per
Share - Diluted
Continuing
$0.94 $0.70 n/m operations $5.01 $1.88 n/m
Discontinued
(0.01) -- n/m operations (0.01) -- n/m
Cumulative effect of
-- -- -- accounting change (0.31) -- n/m
------- -------- -------- ------- ------- --------
$0.93 $0.70 n/m Net income $4.69 $1.88 n/m
======= ======== ======== ======= ======= ========
Weighted average
208 219 number of Shares 213 217
======= ======== ======= =======
Weighted average
number of Shares
217 228 assuming dilution 223 225
======= ======== ======= =======
(a) Includes gains on sales of vacation ownership notes receivable of
$17 million in the three and twelve months ended December 31, 2006.
(b) The Company includes in revenues the reimbursement of costs
incurred on behalf of managed hotel property owners and franchisees
with no added margin and includes in costs and expenses these
reimbursed costs. These costs relate primarily to payroll costs at
managed properties where the Company is the employer.
n/m = not meaningful
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
CONSOLIDATED BALANCE SHEETS
(in millions, except share data)
December 31, December 31,
2006 2005
------------ ------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents $183 $897
Restricted cash 329 295
Accounts receivable, net of allowance for
doubtful accounts of $49 and $50 593 642
Inventories 566 280
Prepaid expenses and other 139 169
------------ ------------
Total current assets 1,810 2,283
Investments 436 403
Plant, property and equipment, net 3,831 4,169
Assets held for sale (a) 2 2,882
Goodwill and intangible assets, net 2,302 2,315
Deferred tax assets 530 40
Other assets (b) 381 402
------------ ------------
$9,292 $12,494
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Short-term borrowings and current
maturities of long-term debt (c) $805 $1,219
Accounts payable 179 156
Accrued expenses 955 1,049
Accrued salaries, wages and benefits 383 297
Accrued taxes and other 153 158
------------ ------------
Total current liabilities 2,475 2,879
Long-term debt (c) 1,827 2,849
Long-term debt held for sale (d) -- 77
Deferred tax liabilities 28 602
Other liabilities 1,928 851
------------ ------------
6,258 7,258
Minority interest 25 25
Commitments and contingencies
Stockholders' equity:
Class A exchangeable preferred shares of
the Trust; $0.01 par value; authorized
30,000,000 shares; outstanding 0 and
562,222 shares at December 31, 2006 and
December 31, 2005, respectively -- --
Class B exchangeable preferred shares of
the Trust; $0.01 par value; authorized
15,000,000 shares; outstanding 0 and
24,627 shares at December 31, 2006 and
December 31, 2005, respectively -- --
Corporation common stock; $0.01 par
value; authorized 1,050,000,000
213,484,439 and 217,218,781 shares at
December 31, 2006 and December 31, 2005,
respectively 2 2
Trust Class B shares of beneficial
interest; $0.01 par value; authorized
1,000,000,000 shares; outstanding 0 and
217,218,781 shares at December 31, 2006
and December 31, 2005, respectively -- 2
Additional paid-in capital 2,286 5,412
Deferred compensation -- (53)
Accumulated other comprehensive loss (227) (322)
Retained earnings 948 170
------------ ------------
Total stockholders' equity 3,009 5,211
--------------------------
$9,292 $12,494
==========================
(a) At December 31, 2006, reflects land which is considered held for
sale. At December 31, 2005, includes 33 hotels that were sold in the
second quarter of 2006 in connection with the definitive agreement
signed on November 14, 2005 with Host Hotels & Resorts, Inc. and 3
hotels that had signed definitive agreements at December 31, 2005 and
were sold in the first quarter of 2006.
(b) Includes restricted cash of $7 million and $12 million at December
31, 2006 and December 31, 2005, respectively.
(c) Excludes Starwood's share of unconsolidated joint venture debt
aggregating approximately $484 million and $469 million at December
31, 2006 and December 31, 2005, respectively.
(d) Represents the debt that was assumed by Host in connection with
the definitive agreement signed on November 14, 2005.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP to GAAP Reconciliations - Historical Data
(in millions)
Three Months Ended Year Ended
December 31, December 31,
------------------------ ------------------------
% %
2006 2005 Variance 2006 2005 Variance
------- ------- -------- ------- ------- --------
Reconciliation of
Net Income to
EBITDA and Adjusted
EBITDA
$203 $159 n/m Net income $1,043 $422 n/m
47 76 (38.2) Interest expense(a) 263 283 (7.1)
Income tax (benefit)
38 44 n/m expense(b) (432) 218 n/m
78 93 (16.1) Depreciation(c) 311 423 (26.5)
6 8 (25.0) Amortization (d) 31 26 19.2
------- ------- -------- ------- ------- --------
372 380 (2.1) EBITDA 1,216 1,372 (11.4)
Loss (gain) on asset
dispositions and
4 (2) n/m impairments, net 3 30 (90.0)
Restructuring and
other special
9 13 (30.8) charges, net 20 13 53.8
Discontinued
-- -- -- operations -- 2 n/m
Cumulative effect of
(2) -- n/m accounting change 70 -- n/m
------- ------- -------- ------- ------- --------
$383 $391 (2.0) Adjusted EBITDA $1,309 $1,417 (7.6)
======= ======= ======== ======= ======= ========
(a) Includes $4 million and $10 million of interest expense related to
unconsolidated joint ventures for the three months ended December 31,
2006 and 2005, respectively, and $19 million and $25 million for the
year ended December 31, 2006 and 2005, respectively.
(b) Includes $2 million and $0 million of tax (benefit) expense
recorded in discontinued operations for the three months ended
December 31, 2006 and 2005, respectively, and $2 million and $1
million for the year ended December 31, 2006 and 2005, respectively.
(c) Includes $8 million and $11 million of Starwood's share of
depreciation expense of unconsolidated joint ventures for the three
months ended December 31, 2006 and 2005, respectively, and $31
million and $36 million for the year ended December 31, 2006 and
2005, respectively.
(d) Includes $1 million of Starwood's share of amortization expense of
unconsolidated joint ventures for the three months ended December 31,
2006 and 2005, and $5 million and $6 million for the year ended
December 31, 2006 and 2005, respectively.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP to GAAP Reconciliations - Future Performance
(In millions)
Three Months Ended Year Ended
March 31, 2007 December 31, 2007
------------------ -----------------
$83 Net income $543
46 Interest expense 184
41 Income tax expense 268
85 Depreciation and amortization 340
------------------ -----------------
255 EBITDA 1,335
Gain on asset disposition and
-- impairments, net --
Restructuring and other special
-- charges, net --
------------------ -----------------
$255 Adjusted EBITDA $1,335
================== =================
Three Months Ended Year Ended
March 31, 2007 December 31, 2007
------------------ -----------------
$83 Income from continuing operations 543
------------------ -----------------
$0.38 EPS $2.50
------------------ -----------------
Special Items
Restructuring and other special
-- charges, net --
Gain on asset dispositions and
-- impairments, net --
------------------ -----------------
-- Total special items - pre-tax --
Income tax (benefit) expense on
-- special items --
------------------ -----------------
-- Total special items - after-tax --
------------------ -----------------
Income from continuing operations
$83 excluding special items $543
------------------ -----------------
$0.38 EPS excluding special items $2.50
================== =================
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP to GAAP Reconciliations -
Same Store Owned Hotel Revenue and Expenses
(In millions)
Three Months Ended Year Ended
December 31, December 31,
------------------------ ------------------------
Same-Store Owned
% Hotels (1) %
2006 2005 Variance Worldwide 2006 2005 Variance
------- ------- -------- ------- ------- --------
Revenue
Same-Store Owned
$512 $466 9.8 Hotels $1,942 $1,785 8.8
Hotels Sold or
Closed in 2006
and 2005 (56
2 358 (99.3) hotels) 384 1,422 (73.0)
Hotels Without
Comparable
Results (11
88 70 27.2 hotels) 359 304 18.3
Other ancillary
-- -- -- hotel operations 7 6 7.7
------- ------- -------- ------- ------- --------
Total Owned, Leased
and Consolidated
Joint Venture
$602 $894 (32.7) Hotels Revenue $2,692 $3,517 (23.5)
======= ======= ======== ======= ======= ========
Costs and Expenses
Same-Store Owned
$377 $356 (6.1) Hotels $1,443 $1,361 (6.0)
Hotels Sold or
Closed in 2006
and 2005 (56
1 254 99.7 hotels) 293 1,026 71.4
Hotels Without
Comparable
Results (11
70 62 13.5 hotels) 283 243 (16.4)
Other ancillary
-- -- -- hotel operations 4 4 (2.1)
------- ------- -------- ------- ------- --------
Total Owned, Leased
and Consolidated
Joint Venture
Hotels Costs and
$448 $672 33.3 Expenses $2,023 $2,634 23.2
======= ======= ======== ======= ======= ========
Three Months Ended Year Ended
December 31, December 31,
------------------------ ------------------------
Same-Store Owned
% Hotels %
2006 2005 Variance North America 2006 2005 Variance
------- ------- -------- ------- ------- --------
Revenue
Same-Store Owned
$332 $309 7.3 Hotels $1,255 $1,148 9.3
Hotels Sold or
Closed in 2006
and 2005 (45
1 298 (99.7) hotels) 311 1,168 (73.4)
Hotels Without
Comparable
Results (8
76 62 23.9 hotels) 315 255 23.4
------- ------- -------- ------- ------- --------
Total Owned, Leased
and Consolidated
Joint Venture
$409 $669 (38.8) Hotels Revenue $1,881 $2,571 (26.8)
======= ======= ======== ======= ======= ========
Costs and Expenses
Same-Store Owned
$245 $233 (5.5) Hotels $925 $868 (6.5)
Hotels Sold or
Closed in 2006
and 2005 (45
1 210 (99.7) hotels) 242 846 (71.3)
Hotels Without
Comparable
Results (8
61 54 13.2 hotels) 250 208 20.5
------- ------- -------- ------- ------- --------
Total Owned, Leased
and Consolidated
Joint Venture
Hotels Costs and
$307 $497 38.2 Expenses $1,417 $1,922 26.3
======= ======= ======== ======= ======= ========
Three Months Ended Year Ended
December 31, December 31,
------------------------ ------------------------
Same-Store Owned
% Hotels %
2006 2005 Variance International 2006 2005 Variance
------- ------- -------- ------- ------- --------
Revenue
Same-Store Owned
$180 $157 14.7 Hotels $687 $637 7.8
Hotels Sold or
Closed in 2006
and 2005 (11
1 60 (97.9) hotels) 73 254 (71.2)
Hotels Without
Comparable
Results (3
12 8 54.5 hotels) 44 49 (8.6)
Other ancillary
-- -- -- hotel operations 7 6 7.7
------- ------- -------- ------- ------- --------
Total Owned, Leased
and Consolidated
Joint Venture
$193 $225 (14.3) Hotels Revenue $811 $946 (14.3)
======= ======= ======== ======= ======= ========
Costs and Expenses
Same-Store Owned
$132 $123 (7.3) Hotels $518 $493 (5.1)
Hotels Sold or
Closed in 2006
and 2005 (11
-- 44 (100.1) hotels) 51 180 (71.5)
Hotels Without
Comparable
Results (3
9 8 15.5 hotels) 33 35 (7.8)
Other ancillary
-- -- -- hotel operations 4 4 2.1
------- ------- -------- ------- ------- --------
Total Owned, Leased
and Consolidated
Joint Venture
Hotels Costs and
$141 $175 19.3 Expenses $606 $712 14.9
======= ======= ======== ======= ======= ========
(1) Same-Store Owned Hotel Results exclude 56 hotels sold or closed in
2006 and 2005 and 11 hotels without comparable results;
Starwood Hotels & Resorts Worldwide, Inc.
Worldwide Hotel Results - Same Store
For the Three Months Ended December 31, 2006
UNAUDITED
System Wide (1) - System Wide (1) -
Worldwide North America
--------------------- ---------------------
2006 2005 Var. 2006 2005 Var.
------- ------- ----- ------- ------- -----
TOTAL HOTELS
REVPAR ($) 109.09 97.90 11.4% 108.66 99.59 9.1%
ADR ($) 160.67 147.02 9.3% 159.26 148.20 7.5%
OCCUPANCY (%) 67.9% 66.6% 1.3 68.2% 67.2% 1.0
SHERATON
REVPAR ($) 99.48 88.80 12.0% 97.89 90.92 7.7%
ADR ($) 148.19 134.75 10.0% 145.93 136.93 6.6%
OCCUPANCY (%) 67.1% 65.9% 1.2 67.1% 66.4% 0.7
WESTIN
REVPAR ($) 125.18 113.74 10.1% 122.67 111.77 9.8%
ADR ($) 180.23 166.36 8.3% 176.46 163.43 8.0%
OCCUPANCY (%) 69.5% 68.4% 1.1 69.5% 68.4% 1.1
ST. REGIS/LUXURY
COLLECTION
REVPAR ($) 199.39 171.83 16.0% 190.85 164.99 15.7%
ADR ($) 311.48 286.57 8.7% 292.05 275.74 5.9%
OCCUPANCY (%) 64.0% 60.0% 4.0 65.4% 59.8% 5.6
W
REVPAR ($) 233.81 209.66 11.5% 243.07 214.21 13.5%
ADR ($) 310.49 287.82 7.9% 314.79 289.08 8.9%
OCCUPANCY (%) 75.3% 72.8% 2.5 77.2% 74.1% 3.1
FOUR POINTS
REVPAR ($) 65.94 59.65 10.5% 63.57 57.82 9.9%
ADR ($) 99.93 92.90 7.6% 98.23 91.80 7.0%
OCCUPANCY (%) 66.0% 64.2% 1.8 64.7% 63.0% 1.7
OTHER
REVPAR ($) 108.66 105.23 3.3% 108.66 105.23 3.3%
ADR ($) 139.09 131.30 5.9% 139.09 131.30 5.9%
OCCUPANCY (%) 78.1% 80.1% -2.0 78.1% 80.1% -2.0
System Wide (1) -
International
----------------------
2006 2005 Var.
------- ------- ------
TOTAL HOTELS
REVPAR ($) 109.80 95.11 15.4%
ADR ($) 163.02 145.01 12.4%
OCCUPANCY (%) 67.4% 65.6% 1.8
SHERATON
REVPAR ($) 101.33 86.34 17.4%
ADR ($) 150.81 132.18 14.1%
OCCUPANCY (%) 67.2% 65.3% 1.9
WESTIN
REVPAR ($) 133.12 119.96 11.0%
ADR ($) 192.24 175.60 9.5%
OCCUPANCY (%) 69.2% 68.3% 0.9
ST. REGIS/LUXURY COLLECTION
REVPAR ($) 205.81 176.98 16.3%
ADR ($) 326.65 294.70 10.8%
OCCUPANCY (%) 63.0% 60.1% 2.9
W
REVPAR ($) 145.26 166.22 -12.6%
ADR ($) 254.84 273.17 -6.7%
OCCUPANCY (%) 57.0% 60.8% -3.8
FOUR POINTS
REVPAR ($) 72.71 65.03 11.8%
ADR ($) 104.44 95.92 8.9%
OCCUPANCY (%) 69.6% 67.8% 1.8
OTHER
REVPAR ($)
ADR ($)
OCCUPANCY (%)
(1) Includes same store owned, leased, managed, and franchised hotels
Starwood Hotels & Resorts Worldwide, Inc.
Worldwide Hotel Results - Same Store
For the Three Months Ended December 31, 2006
UNAUDITED
System Wide (1) Company Operated (2)
--------------------- ---------------------
2006 2005 Var. 2006 2005 Var.
------- ------- ----- ------- ------- -----
TOTAL WORLDWIDE
REVPAR ($) 109.09 97.90 11.4% 125.12 111.49 12.2%
ADR ($) 160.67 147.02 9.3% 179.72 163.70 9.8%
OCCUPANCY (%) 67.9% 66.6% 1.3 69.6% 68.1% 1.5
NORTH AMERICA
REVPAR ($) 108.66 99.59 9.1% 133.35 121.87 9.4%
ADR ($) 159.26 148.20 7.5% 187.27 173.32 8.0%
OCCUPANCY (%) 68.2% 67.2% 1.0 71.2% 70.3% 0.9
EUROPE
REVPAR ($) 122.74 104.92 17.0% 138.59 117.02 18.4%
ADR ($) 185.48 165.18 12.3% 206.87 183.97 12.4%
OCCUPANCY (%) 66.2% 63.5% 2.7 67.0% 63.6% 3.4
AFRICA & MIDDLE EAST
REVPAR ($) 104.71 83.88 24.8% 104.85 84.01 24.8%
ADR ($) 158.70 136.37 16.4% 159.39 136.58 16.7%
OCCUPANCY (%) 66.0% 61.5% 4.5 65.8% 61.5% 4.3
ASIA PACIFIC
REVPAR ($) 110.10 98.98 11.2% 107.78 96.01 12.3%
ADR ($) 158.43 142.24 11.4% 154.63 139.32 11.0%
OCCUPANCY (%) 69.5% 69.6% -0.1 69.7% 68.9% 0.8
LATIN AMERICA
REVPAR ($) 81.06 72.03 12.5% 90.40 80.74 12.0%
ADR ($) 122.82 111.29 10.4% 137.32 124.20 10.6%
OCCUPANCY (%) 66.0% 64.7% 1.3 65.8% 65.0% 0.8
(1) Includes same store owned, leased, managed, and franchised hotels
(2) Includes same store owned, leased, and managed hotels
Starwood Hotels & Resorts Worldwide, Inc.
Owned Hotel Results - Same Store (1)
For the Three Months Ended December 31, 2006
UNAUDITED
WORLDWIDE NORTH AMERICA
----------------------- ----------------------
2006 2005 Var. 2006 2005 Var.
-------- -------- ----- -------- -------- ----
75 Hotels 44 Hotels
----------------------- ----------------------
TOTAL HOTELS
REVPAR ($) 139.00 125.33 10.9% 137.63 127.63 7.8%
ADR ($) 199.48 183.64 8.6% 197.99 184.33 7.4%
OCCUPANCY (%) 69.7% 68.2% 1.5 69.5% 69.2% 0.3
Total REVENUE 511,681 466,202 9.8% 332,035 309,567 7.3%
Total EXPENSES 377,443 355,645 6.1% 245,129 232,357 5.5%
66 Hotels 35 Hotels
----------------------- ----------------------
BRANDED HOTELS
REVPAR ($) 143.81 128.80 11.7% 144.96 133.47 8.6%
ADR ($) 203.59 187.09 8.8% 204.21 189.75 7.6%
OCCUPANCY (%) 70.6% 68.8% 1.8 71.0% 70.3% 0.7
Total REVENUE 478,388 432,510 10.6% 298,742 275,875 8.3%
Total EXPENSES 349,995 328,535 6.5% 217,681 205,247 6.1%
INTERNATIONAL
-----------------------
2006 2005 Var.
-------- -------- -----
31 Hotels
-----------------------
TOTAL HOTELS
REVPAR ($) 141.80 120.65 17.5%
ADR ($) 202.49 182.17 11.2%
OCCUPANCY (%) 70.0% 66.2% 3.8
Total REVENUE 179,646 156,635 14.7%
Total EXPENSES 132,314 123,288 7.3%
31 Hotels
-----------------------
BRANDED HOTELS
REVPAR ($) 141.80 120.65 17.5%
ADR ($) 202.49 182.17 11.2%
OCCUPANCY (%) 70.0% 66.2% 3.8
Total REVENUE 179,646 156,635 14.7%
Total EXPENSES 132,314 123,288 7.3%
(1) Hotel Results exclude 50 hotels sold and 10 hotels without
comparable results during 2005 & 2006
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Management Fees, Franchise Fees and Other Income
For the Three Months Ended December 31, 2006
UNAUDITED ($ millions)
Worldwide
------------------------------------
%
2006 2005 Variance Variance
------- ------- -------- --------
Management Fees:
Base Fees 65 41 24 58.5%
Incentive Fees 42 27 15 55.6%
------- ------- -------- --------
Total Management Fees 107 68 39 57.4%
Franchise Fees 31 23 8 34.8%
------- ------- -------- --------
Total Management & Franchise Fees 138 91 47 51.6%
Other Management & Franchise
Revenues (1) 23 13 10 76.9%
------- ------- -------- --------
Total Management & Franchise
Revenues 161 104 57 54.8%
======= ======= ======== ========
Other (2) 48 48 0 -
------- ------- -------- --------
Management Fees, Franchise Fees
and Other Income 209 152 57 37.5%
======= ======= ======== ========
(1) Other Management & Franchise Fees primarily includes the
amortization of deferred gains of approximately $20 million in 2006
and $3 million in 2005 resulting from the sales of hotels subject to
long-term management contracts and termination fees.
(2) Other primarily includes revenues from Bliss and other
miscellaneous revenue.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Vacation Ownership & Residential Revenues and Expenses
For the Three Months Ended December 31, 2006
UNAUDITED ($ millions)
%
2006 2005 Variance
------- ------- ----------
Originated Sales Revenues (1) -- Vacation
Ownership Sales 176 153 15.0%
Other Sales and Services Revenues (2) 52 29 79.3%
Deferred Revenues -- Percentage of
Completion 70 (25) n/m
Deferred Revenues -- Other (3) 12 (8) n/m
------- ------- ----------
Vacation Ownership Sales and Services
Revenues 310 149 108.1%
Residential Sales and Services Revenues 12 43 (72.1%)
------- ------- ----------
Total Vacation Ownership & Residential
Sales and Services Revenues 322 192 67.7%
======= ======= ==========
Originated Sales Expenses (4) -- Vacation
Ownership Sales 109 104 (4.8%)
Other Expenses (5) 41 38 (7.9%)
Deferred Expenses -- Percentage of
Completion 33 (17) n/m
Deferred Expenses -- Other 10 (5) (300.0%)
------- ------- ----------
Vacation Ownership Expenses 193 120 (60.8%)
Residential Expenses 11 38 71.1%
------- ------- ----------
Total Vacation Ownership & Residential
Expenses 204 158 (29.1%)
======= ======= ==========
(1) Timeshare sales revenue originated at each sales location before
deferrals of revenue for U.S. GAAP reporting purposes
(2) Includes resort income, interest income, gain on sale of notes
receivable, and miscellaneous other revenues
(3) Includes deferral of revenue for contracts still in rescission
period, contracts that do not yet meet the requirements of SFAS No.
66 or SFAS No. 152 and, in 2006, provision for loan loss
(4) Timeshare cost of sales and sales & marketing expenses before
deferrals of sales expenses for U.S. GAAP reporting purposes
(5) Includes resort, general and administrative, and other
miscellaneous expenses
Note: Deferred revenue is calculated based on the Percentage of
Completion ("POC") of the project. Deferred expenses, also based on
POC, include product costs and direct sales and marketing costs only.
Indirect sales and marketing costs are no longer deferred per SFAS
152 as of January 1, 2006.
Starwood Hotels & Resorts Worldwide, Inc.
Worldwide Hotel Results - Same Store
For the Twelve Months Ended December 31, 2006
UNAUDITED
System Wide (1) - System Wide (1) -
Worldwide North America
--------------------- ---------------------
2006 2005 Var. 2006 2005 Var.
------- ------- ----- ------- ------- -----
TOTAL HOTELS
REVPAR ($) 109.66 99.82 9.9% 111.52 101.93 9.4%
ADR ($) 156.51 144.23 8.5% 154.76 143.27 8.0%
OCCUPANCY (%) 70.1% 69.2% 0.9 72.1% 71.1% 1.0
SHERATON
REVPAR ($) 98.71 89.81 9.9% 101.38 93.38 8.6%
ADR ($) 143.56 131.21 9.4% 143.13 132.28 8.2%
OCCUPANCY (%) 68.8% 68.4% 0.4 70.8% 70.6% 0.2
WESTIN
REVPAR ($) 127.47 116.62 9.3% 126.64 114.89 10.2%
ADR ($) 176.56 164.24 7.5% 172.64 159.46 8.3%
OCCUPANCY (%) 72.2% 71.0% 1.2 73.4% 72.0% 1.4
ST. REGIS/LUXURY
COLLECTION
REVPAR ($) 215.39 191.22 12.6% 204.55 179.79 13.8%
ADR ($) 318.86 296.40 7.6% 285.84 267.32 6.9%
OCCUPANCY (%) 67.5% 64.5% 3.0 71.6% 67.3% 4.3
W
REVPAR ($) 212.51 188.87 12.5% 220.86 195.93 12.7%
ADR ($) 280.14 256.55 9.2% 282.83 257.99 9.6%
OCCUPANCY (%) 75.9% 73.6% 2.3 78.1% 75.9% 2.2
FOUR POINTS
REVPAR ($) 67.91 61.76 10.0% 66.23 60.23 10.0%
ADR ($) 98.33 91.64 7.3% 96.36 89.33 7.9%
OCCUPANCY (%) 69.1% 67.4% 1.7 68.7% 67.4% 1.3
OTHER
REVPAR ($) 109.89 106.11 3.6% 109.89 106.11 3.6%
ADR ($) 132.91 131.43 1.1% 132.91 131.43 1.1%
OCCUPANCY (%) 82.7% 80.7% 2.0 82.7% 80.7% 2.0
System Wide (1) -
International
---------------------
2006 2005 Var.
------- ------- -----
TOTAL HOTELS
REVPAR ($) 106.52 96.30 10.6%
ADR ($) 159.69 145.96 9.4%
OCCUPANCY (%) 66.7% 66.0% 0.7
SHERATON
REVPAR ($) 95.53 85.55 11.7%
ADR ($) 144.11 129.85 11.0%
OCCUPANCY (%) 66.3% 65.9% 0.4
WESTIN
REVPAR ($) 130.08 122.05 6.6%
ADR ($) 189.75 180.17 5.3%
OCCUPANCY (%) 68.6% 67.7% 0.9
ST. REGIS/LUXURY COLLECTION
REVPAR ($) 222.39 198.89 11.8%
ADR ($) 342.35 317.33 7.9%
OCCUPANCY (%) 65.0% 62.7% 2.3
W
REVPAR ($) 132.76 121.53 9.2%
ADR ($) 243.38 236.30 3.0%
OCCUPANCY (%) 54.5% 51.4% 3.1
FOUR POINTS
REVPAR ($) 72.79 66.23 9.9%
ADR ($) 103.92 98.37 5.6%
OCCUPANCY (%) 70.0% 67.3% 2.7
OTHER
REVPAR ($)
ADR ($)
OCCUPANCY (%)
(1) Includes same store owned, leased, managed, and franchised hotels
Starwood Hotels & Resorts Worldwide, Inc.
Worldwide Hotel Results - Same Store
For the Twelve Months Ended December 31, 2006
UNAUDITED
System Wide (1) Company Operated (2)
--------------------- ----------------------
2006 2005 Var. 2006 2005 Var.
------- ------- ----- -------- ------- -----
TOTAL WORLDWIDE
REVPAR ($) 109.66 99.82 9.9% 123.27 111.99 10.1%
ADR ($) 156.51 144.23 8.5% 172.72 158.84 8.7%
OCCUPANCY (%) 70.1% 69.2% 0.9 71.4% 70.5% 0.9
NORTH AMERICA
REVPAR ($) 111.52 101.93 9.4% 132.82 121.12 9.7%
ADR ($) 154.76 143.27 8.0% 178.26 164.79 8.2%
OCCUPANCY (%) 72.1% 71.1% 1.0 74.5% 73.5% 1.0
EUROPE
REVPAR ($) 129.20 116.40 11.0% 143.65 128.84 11.5%
ADR ($) 192.29 179.57 7.1% 210.31 197.40 6.5%
OCCUPANCY (%) 67.2% 64.8% 2.4 68.3% 65.3% 3.0
AFRICA & MIDDLE EAST
REVPAR ($) 95.96 84.21 14.0% 96.78 84.98 13.9%
ADR ($) 145.48 125.29 16.1% 145.61 124.88 16.6%
OCCUPANCY (%) 66.0% 67.2% -1.2 66.5% 68.0% -1.5
ASIA PACIFIC
REVPAR ($) 100.07 92.79 7.8% 97.89 91.40 7.1%
ADR ($) 148.43 137.07 8.3% 144.30 134.68 7.1%
OCCUPANCY (%) 67.4% 67.7% -0.3 67.8% 67.9% -0.1
LATIN AMERICA
REVPAR ($) 76.86 67.04 14.6% 85.89 75.09 14.4%
ADR ($) 119.48 106.90 11.8% 134.79 118.38 13.9%
OCCUPANCY (%) 64.3% 62.7% 1.6 63.7% 63.4% 0.3
(1) Includes same store owned, leased, managed, and franchised hotels
(2) Includes same store owned, leased, and managed hotels
Starwood Hotels & Resorts Worldwide, Inc.
Owned Hotel Results - Same Store (1)
For the Twelve Months Ended December 31, 2006
UNAUDITED
WORLDWIDE NORTH AMERICA
--------------------------- ---------------------------
2006 2005 Var. 2006 2005 Var.
---------- ---------- ----- ---------- ---------- -----
74 Hotels 43 Hotels
--------------------------- ---------------------------
TOTAL HOTELS
REVPAR ($) 136.33 123.80 10.1% 135.46 122.94 10.2%
ADR ($) 191.56 177.04 8.2% 185.61 170.47 8.9%
OCCUPANCY(%) 71.2% 69.9% 1.3 73.0% 72.1% 0.9
Total
REVENUE 1,941,796 1,785,090 8.8% 1,255,149 1,148,297 9.3%
Total
EXPENSES 1,442,812 1,361,570 6.0% 924,766 868,535 6.5%
65 Hotels 34 Hotels
--------------------------- ---------------------------
BRANDED HOTELS
REVPAR ($) 140.20 126.90 10.5% 141.47 127.72 10.8%
ADR ($) 195.70 180.37 8.5% 191.08 174.57 9.5%
OCCUPANCY(%) 71.6% 70.4% 1.2 74.0% 73.2% 0.8
Total
REVENUE 1,805,444 1,650,788 9.4% 1,118,797 1,013,995 10.3%
Total
EXPENSES 1,332,566 1,254,812 6.2% 814,520 761,777 6.9%
INTERNATIONAL
-----------------------
2006 2005 Var.
-------- -------- -----
31 Hotels
-----------------------
TOTAL HOTELS
REVPAR ($) 138.05 125.51 10.0%
ADR ($) 204.33 191.38 6.8%
OCCUPANCY(%) 67.6% 65.6% 2.0
Total REVENUE 686,647 636,793 7.8%
Total EXPENSES 518,046 493,035 5.1%
31 Hotels
-----------------------
BRANDED HOTELS
REVPAR ($) 138.05 125.51 10.0%
ADR ($) 204.33 191.38 6.8%
OCCUPANCY(%) 67.6% 65.6% 2.0
Total REVENUE 686,647 636,793 7.8%
Total EXPENSES 518,046 493,035 5.1%
(1) Hotel Results exclude 56 hotels sold and 11 hotels without
comparable results during 2005 & 2006
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Management Fees, Franchise Fees and Other Income
For the Twelve Months Ended December 31, 2006
UNAUDITED ($ millions)
Worldwide
------------------------------------
%
2006 2005 Variance Variance
------- ------- -------- --------
Management Fees:
Base Fees 234 146 88 60.3%
Incentive Fees 132 80 52 65.0%
------- ------- -------- --------
Total Management Fees 366 226 140 61.9%
Franchise Fees 118 96 22 22.9%
------- ------- -------- --------
Total Management & Franchise Fees 484 322 162 50.3%
Other Management & Franchise
Revenues (1) 80 40 40 100.0%
------- ------- -------- --------
Total Management & Franchise
Revenues 564 362 202 55.8%
======= ======= ======== ========
Other (2) 133 139 (6) (4.3)%
------- ------- -------- --------
Management Fees, Franchise Fees
and Other Income 697 501 196 39.1%
======= ======= ======== ========
(1) Other Management & Franchise Fees primarily includes the
amortization of deferred gains of approximately $62 million in 2006
and $12 million in 2005 resulting from the sales of hotels subject to
long-term management contracts and termination fees.
(2) Other primarily includes revenues from Bliss and other
miscellaneous revenue.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Vacation Ownership & Residential Revenues and Expenses
For the Twelve Months Ended December 31, 2006
UNAUDITED ($ millions)
%
2006 2005 Variance
------- ------- --------
Originated Sales Revenues (1) -- Vacation
Ownership Sales 739 620 19.2%
Other Sales and Services Revenues (2) 156 112 39.3%
Deferred Revenues -- Percentage of
Completion 0 (23) n/m
Deferred Revenues -- Other (3) 10 (6) n/m
------- ------- --------
Vacation Ownership Sales and Services
Revenues 905 703 28.7%
Residential Sales and Services Revenues 100 186 (46.2%)
------- ------- --------
Total Vacation Ownership & Residential
Sales and Services Revenues 1,005 889 13.0%
======= ======= ========
Originated Sales Expenses (4) -- Vacation
Ownership Sales 471 405 (16.3%)
Other Expenses (5) 159 129 (23.3%)
Deferred Expenses -- Percentage of
Completion 0 (16) n/m
Deferred Expenses -- Other 29 (4) n/m
------- ------- --------
Vacation Ownership Expenses 659 514 (28.2%)
Residential Expenses 77 147 47.6%
------- ------- --------
Total Vacation Ownership & Residential
Expenses 736 661 (11.3%)
======= ======= ========
(1) Timeshare sales revenue originated at each sales location before
deferrals of revenue for U.S. GAAP reporting purposes
(2) Includes resort income, interest income, gain on sale of notes
receivable, and miscellaneous other revenues
(3) Includes deferral of revenue for contracts still in rescission
period, contracts that do not yet meet the requirements of SFAS No.
66 or SFAS No. 152 and, in 2006, provision for loan loss
(4) Timeshare cost of sales and sales & marketing expenses before
deferrals of sales expenses for U.S. GAAP reporting purposes
(5) Includes resort, general and administrative, and other
miscellaneous expenses
Note: Deferred revenue is calculated based on the Percentage of
Completion ("POC") of the project. Deferred expenses, also based on
POC, include product costs and direct sales and marketing costs only.
Indirect sales and marketing costs are no longer deferred per SFAS
152 as of January 1, 2006.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Debt Portfolio Summary
As of December 31, 2006
UNAUDITED
Interest Balance % of Interest Avg Maturity
Debt Terms (in millions) Portfolio Rate (in years)
--------------- -------- ------------- --------- -------- ------------
Floating Rate
Debt:
Senior credit
facility
Revolving
credit Various
facility + .475% $435 17% 5.77% 4.1
------------- --------- -------- ------------
435 17% 5.77% 4.1
Mortgages and
other Various 132 5% 7.10% 1.5
Interest rate LIBOR
swaps + 4.23% 300 11% 9.59%
------------- --------- --------
Total Floating 867 33% 7.30% 3.5
Fixed Rate
Debt:
Sheraton
Holding public
debt 449 17% 7.38% 8.9
Senior notes
(1) 1,481 56% 6.70% 3.0
Mortgages and
other 135 5% 7.49% 8.3
Interest rate
swaps (300) -11% 7.88%
------------- --------- --------
Total Fixed 1,765 67% 6.81% 4.6
------------- --------- --------
Total Debt $2,632 100% 6.97% 4.4
============= ========= ========
(1) Balance consists of outstanding public debt of $1.498 billion and
a $5 million fair value adjustment related to the unamortized gain on
fixed to floating interest rate swaps terminated in September 2002
and March 2004 and a ($22) million fair value adjustment related to
current fixed to floating interest rate swaps.
Maturities
---------------------------------------
less than 1 year $805
2-3 years 45
4-5 years 447
greater than 5 years 1,335
------------------
$2,632
==================
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotels without Comparable Results & Other Selected Items
As of December 31, 2006
UNAUDITED ($ millions)
Properties without comparable results in 2006:
Property Location
--------------------------------------- -----------------------------
W New Orleans - French Quarter New Orleans, LA
W New Orleans New Orleans, LA
St. Regis Aspen Aspen, CO
Sheraton Bal Harbour Beach Resort Bal Harbour, FL
St. Regis New York New York, NY
Caesars Paradise Stream Mount Pocono, PA
St. Regis Hotel, San Francisco San Francisco, CA
Westin St. John Resort & Villas St. John, Virgin Islands
The Westin Resort & Spa, Cancun Cancun, Mexico
Sheraton Fiji Nadi, Fiji
Westin Royal Denarau Nadi, Fiji
Properties sold or closed in 2006 and 2005:
Property Location
--------------------------------------- -----------------------------
33 Hotels Sold to Host Hotels & Resorts Various
Sheraton Denver Tech Center Englewood, CO
Deerfield Beach Hilton Ft. Lauderdale, FL
Raphael Chicago, IL
Sheraton Chapel Hill Chapel Hill, NC
St. Regis Washington, DC Washington, DC
Sheraton Russell Hotel New York, NY
Westin Philadelphia Philadelphia, PA
Westin Princeton at Forrestal Village Princeton, NJ
Sheraton Ft. Lauderdale Airport Hotel Dania, FL
Westin Hotel Long Beach Long Beach, CA
Sheraton Suites San Diego San Diego, CA
Sheraton Framingham Hotel Framingham, MA
Westin Embassy Row, Washington D.C. Washington, DC
Westin Atlanta North at Perimeter Atlanta, GA
Sheraton Suites Key West Key West, FL
Sheraton Colony Square Atlanta, GA
Sheraton Colonial Hotel & Golf Club Lynnfield, MA
Sheraton Universal Hotel Universal City, CA
Hotel Danieli Venice, Italy
Sheraton Lisboa Hotel & Towers Lisbon, Portugal
Sheraton Cancun Resort & Towers Cancun, Mexico
Sheraton Inn Lexington Lexington, MA
Sheraton Omaha Hotel Omaha, NE
Selected Balance Sheet and Cash Flow Items:
Cash and cash equivalents
(including restricted cash of $336 million) $ 519
Debt $ 2,632
Revenues and Expenses Associated with Assets Sold or Closed in 2005
and 2006 or Expected to be Sold in the First Quarter of 2007 (1):
Q1 Q2 Q3 Q4 Full Year
----- ----- ----- ----- ---------
Hotels Sold in 2005:
2005
Revenues $ 36 $ 41 $ 28 $ 18 $ 123
Expenses (excluding
depreciation) $ 29 $ 27 $ 20 $ 14 $ 90
Hotels Sold in 2006:
2006
Revenues $295 $ 71 $ 16 $ 2 $ 384
Expenses (excluding
depreciation) $227 $ 53 $ 12 $ 1 $ 293
2005
Revenues $287 $354 $318 $340 $ 1,299
Expenses (excluding
depreciation) $224 $242 $230 $240 $ 936
Hotels Classified as Held for Sale at December 31, 2006:
2006
Revenues $ - $ - $ - $ - $ -
Expenses (excluding
depreciation) $ - $ - $ - $ - $ -
2005
Revenues $ - $ - $ - $ - $ -
Expenses (excluding
depreciation) $ - $ - $ - $ - $ -
(1) Results consist of 11 hotels sold in 2005, 45 hotels sold in 2006.
There are no hotels classifed as held for sale at December 31, 2006.
These amounts are included in the revenues and expenses from owned,
leased and consolidated joint venture hotels in 2006 and 2005.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Capital Expenditures
For the Three and Twelve Months Ended December 31, 2006
UNAUDITED ($ millions)
Q4 YTD
------ -------
Capital Expenditures:
Owned, Leased and Consolidated Joint Venture Hotels 55 241
Corporate/IT 16 48
------ -------
Subtotal 71 289
Vacation Ownership Capital Expenditures:
Capital expenditures (includes land acquisitions) 26 76
Net capital expenditures for inventory (1) 33 118
------ -------
Subtotal 59 194
Development Capital 59 168
------ -------
Total Capital Expenditures 189 651
====== =======
(1) Represents gross inventory capital expenditures of $107 and $335,
less cost of sales of $74 and $217 for the three and twelve months
ended December 31, 2006.
Starwood Hotels & Resorts Worldwide, Inc.
2006 Divisional Hotel Inventory Summary by Ownership by Brand
December 31, 2006
NAD EAME LAD
---------------- --------------- ---------------
Owned Hotels Rooms Hotels Rooms Hotels Rooms
------- -------- ------- ------- ------- -------
Sheraton 13 6,298 8 1,711 5 2,713
Westin 8 4,030 5 1,068 3 901
Four Points 6 1,153 - - - -
W 10 3,178 - - - -
Luxury Collection 1 654 7 828 1 181
St. Regis 3 668 1 161 - -
Other 10 2,482 - - - -
------- -------- ------- ------- ------- -------
Total Owned 51 18,463 21 3,768 9 3,795
Managed & UJV
Sheraton 55 28,536 76 22,639 14 2,749
Westin 47 25,616 14 3,708 - -
Four Points 1 475 6 899 3 428
W 8 2,269 - - 1 237
Luxury Collection 7 1,697 9 1,545 8 298
St. Regis 5 728 1 95 - -
Le Meridien 5 1,058 71 16,912 2 626
Other 3 2,824 1 - - -
------- -------- ------- ------- ------- -------
Total Managed & UJV 131 63,203 178 45,798 28 4,338
Franchised
Sheraton 127 38,974 26 6,663 5 1,655
Westin 29 10,477 3 1,135 3 598
Four Points 85 14,560 11 1,539 9 1,384
Luxury Collection 1 249 14 1,746 - -
Le Meridien 4 1,342 11 3,924 1 213
------- -------- ------- ------- ------- -------
Total Franchised 246 65,602 65 15,007 18 3,850
----------------------------------------------------------------------
Systemwide
Sheraton 195 73,808 110 31,013 24 7,117
Westin 84 40,123 22 5,911 6 1,499
Four Points 92 16,188 17 2,438 12 1,812
W 18 5,447 - - 1 237
Luxury Collection 9 2,600 30 4,119 9 479
St. Regis 8 1,396 2 256 - -
Le Meridien 9 2,400 82 20,836 3 839
Other 13 5,306 1 - - -
------- -------- ------- ------- ------- -------
Total Systemwide 428 147,268 264 64,573 55 11,983
======= ======== ======= ======= ======= =======
----------------------------------------------------------------------
ASIA Total
--------------- ----------------
Owned Hotels Rooms Hotels Rooms
------- ------- ------- --------
Sheraton 2 831 28 11,553
Westin 1 273 17 6,272
Four Points 1 630 7 1,783
W - - 10 3,178
Luxury Collection - - 9 1,663
St. Regis - - 4 829
Other - - 10 2,482
------- ------- ------- --------
Total Owned 4 1,734 85 27,760
Managed & UJV
Sheraton 46 15,993 191 69,917
Westin 13 5,199 74 34,523
Four Points 2 604 12 2,406
W 2 330 11 2,836
Luxury Collection - - 24 3,540
St. Regis 2 591 8 1,414
Le Meridien 24 5,993 102 24,589
Other - - 4 2,824
------- ------- ------- --------
Total Managed & UJV 89 28,710 426 142,049
Franchised
Sheraton 19 7,097 177 54,389
Westin 5 1,226 40 13,436
Four Points 2 235 107 17,718
Luxury Collection - - 15 1,995
Le Meridien 5 2,772 21 8,251
------- ------- ------- --------
Total Franchised 31 11,330 360 95,789
----------------------------------------------------------------------
Systemwide
Sheraton 67 23,921 396 135,859
Westin 19 6,698 131 54,231
Four Points 5 1,469 126 21,907
W 2 330 21 6,014
Luxury Collection - - 48 7,198
St. Regis 2 591 12 2,243
Le Meridien 29 8,765 123 32,840
Other - - 14 5,306
------- ------- ------- --------
Total Systemwide 124 41,774 871 265,598
======= ======= ======= ========
----------------------------------------------------------------------
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Top 40 Owned and Consolidated Joint Venture Hotels
For the Year Ended December 31, 2006
US Hotels Location Rooms
------------------------------------------------------------------
St. Regis New York New York, NY 229
St. Regis Aspen Aspen, CO 179
The Phoenician Phoenix, AZ 654
W New York - Time Square New York, NY 507
W Chicago Lakeshore Chicago, IL 520
W San Francisco San Francisco, CA 410
W Los Angeles Westwood Los Angeles, CA 258
W Chicago - City Center Chicago, IL 369
W New Orleans New Orleans, LA 423
W New York - The Court New York, NY 198
W Atlanta Atlanta, GA 275
W New York - The Tuscany New York, NY 120
Westin Maui Resort & Spa Maui, HI 759
Westin Peachtree Atlanta, GA 1068
Westin Horton Plaza San Diego San Diego, CA 450
Westin Galleria Houston Houston, TX 487
Westin San Francisco Airport San Francisco, CA 393
Westin Fort Lauderdale Fort Lauderdale, FL 293
Sheraton Manhattan Hotel New York, NY 665
Sheraton Bal Harbour Beach Resort Bal Harbour, FL 645
Sheraton Kauai Resort Kauai, HI 394
Boston Park Plaza Hotel Boston, MA 941
International Hotels Location Rooms
------------------------------------------------------------------
St. Regis Grand Hotel, Rome Rome, Italy 161
Hotel Gritti Palace Venice, Italy 91
Park Tower, Buenos Aires Buenos Aires, Argentina 181
Hotel Alfonso XIII Seville, Spain 147
The Westin Excelsior, Rome Rome, Italy 319
The Westin Resort & Spa, Los Cabos Los Cabos, Mexico 243
The Westin Resort & Spa Puerto
Vallarta Puerto Vallarta, Mexico 279
The Westin Excelsior, Florence Florence, Italy 171
The Westin Resort & Spa Cancun Cancun, Mexico 379
Westin St. John Resort & Villas St John, Virgin Islands 174
Sheraton Centre Toronto Hotel Toronto, Canada 1377
The Park Lane Hotel London, England 302
Sheraton On The Park Sydney, Australia 557
Sheraton Buenos Aires Hotel &
Convention Center Buenos Aires, Argentina 739
Sheraton Maria Isabel Hotel &
Towers Mexico City, Mexico 755
Sheraton Gateway Hotel in Toronto
International Hotel Toronto, Canada 474
Le Centre Sheraton Hotel Montreal, Canada 825
Sheraton Paris Airport Hotel
Charles de Gaulle Paris, France 252
*Excludes hotels sold to Host
Top 40 hotels represent 85% of owned and consolidated joint
venture earnings before depreciation
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Top 20 Worldwide Markets
For the Year Ended December 31, 2006
% of 2006
US Assets Total Owned Earnings (1) (2)
----------------------------------------------------------------------
New York, NY 13.0%
Phoenix, AZ 6.8%
Hawaii 6.2%
Atlanta, GA 5.6%
Chicago, IL 4.5%
San Francisco/San Mateo, CA 3.1%
Boston, MA 3.0%
San Diego, CA 2.8%
Miami-Hialeah, FL 2.5%
Los Angeles-Long Beach, CA 2.0%
----------------------------------------------------------------------
Total Top 10 US Markets 49.5%
% of 2006
International Assets Total Owned Earnings (1) (2)
----------------------------------------------------------------------
Italy 9.2%
Mexico 7.2%
Canada 5.9%
Argentina 3.2%
Australia 2.9%
UK 2.7%
Spain 1.5%
France 1.2%
Austria 1.1%
Caribbean 0.8%
----------------------------------------------------------------------
Total Top 10 International Markets 35.7%
(1) Excludes hotels sold to Host
(2) Represents earnings before depreciation
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Total Management & Franchise Fees by Geographic Area
For the Year Ended December 31, 2006
UNAUDITED
Geographical Area Total Management Total Franchise
Fees Fees
------------------------------------ ---------------- ---------------
United States 43.7% 65.2%
Europe 17.9% 14.3%
Asia Pacific 15.7% 8.0%
Middle East and Africa 15.4% 0.9%
Americas (Latin America & Canada) 7.3% 11.6%
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Vacation Ownership Inventory Pipeline
As of December 31, 2006
UNAUDITED
----------------------------------------------------------------------
# Resorts
---------------------------------
In In Active
Brand Total (2) Operations Sales
----------------------------------------------------------------------
Sheraton 7 6 6
Westin 11 4 6
St. Regis 2 1 2
Unbranded 3 3 -
---------------------------------
Total SVO, Inc. 23 14 14
---------------------------------
Unconsolidated Joint Ventures
(UJV's) 2 1 1
---------------------------------
Total including UJV's 25 15 15
----------------------------------------------------------------------
----------------------------------------------------------------------
Total Intervals Including UJV's (7)
----------------------------------------------------------------------
----------------------------------------------------------------------
# of Units (1)
---------------------------------------------------
Future
Pre-sales/ Capacity Total at
Brand Completed (3) Development (4) (5),(6) Buildout
----------------------------------------------------------------------
Sheraton 2,596 135 1,683 4,414
Westin 751 497 813 2,061
St. Regis 47 - - 47
Unbranded 124 - 1 125
----------------------------------------------------
Total SVO, Inc. 3,518 632 2,497 6,647
----------------------------------------------------
Unconsolidated
Joint Ventures
(UJV's) 198 - 36 234
----------------------------------------------------
Total including
UJV's 3,716 632 2,533 6,881
----------------------------------------------------------------------
----------------------------------------------------------------------
Total Intervals
Including UJV's
(7) 193,232 32,864 131,716 357,812
----------------------------------------------------------------------
(1) Lockoff units are considered as one unit for this analysis.
(2) Includes resorts in operation, active sales, and announced new
resorts, Sheraton Kauai and St. Regis Punta Mita (UJV)
(3) Completed units include those units that have a certificate of
occupancy.
(4) Units in Pre-sales/Development are in various stages of
development (including the permitting stage), most of which are
currently being offered for sale to customers.
(5) Based on owned land and average density in existing marketplaces
(6) Future units indicated above include planned timeshare units on
land owned by the Company or applicable UJV that have received all
major governmental land use approvals for the development of
timeshare. There can be no assurance that such units will in fact be
developed and, if developed, the time period of such development
(which may be more than several years in the future). Some of the
projects may require additional third-party approvals or permits for
development and build out and may also be subject to legal challenges
as well as a commitment of capital by the Company. The actual number
of units to be constructed may be significantly lower than the number
of future units indicated.
(7) Assumes 52 intervals per unit.
