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Gaylord Reports 4th Qtr Net Income of $8.4 million, Up from $3.8 million
 in the Year-ago Period / Hotel Operating Statistics


NASHVILLE, Tenn.- February 10, 2009 - Gaylord Entertainment Co. (NYSE: GET) today reported its financial results for the fourth quarter and full year ended December 31, 2008.

“In the face of such an exceptionally difficult economic environment, it's a testament to our STARS, our focus on customer service and our business model that GET performed as well as it did in the fourth quarter and fiscal year,” said Colin V. Reed, chairman and chief executive officer of Gaylord Entertainment.

Highlights from the fourth quarter and full year ended December 31, 2008 include:

  • Consolidated revenue increased 19.9 percent to $250.6 million in the fourth quarter of 2008 from $209.1 million in the same period last year. For the full year 2008, consolidated revenue increased 24.5 percent to $930.9 million.
  • Income from continuing operations was $9.4 million, or $0.23 per share, in the fourth quarter of 2008 compared to income from continuing operations of $5.5 million, or $0.13 per share, in the prior-year quarter. For the full year 2008, income from continuing operations was $4.6 million, or $0.11 per share, compared to income from continuing operations of $102.0 million in the full year 2007, or $2.49 per share. Income from continuing operations in the fourth quarter of 2008 included a $19.9 million pre-tax gain on the repurchase of $45.8 million in aggregate principal amount of the Company’s outstanding Senior Notes, a $4.7 million impairment charge related to the termination of the Chula Vista project and a $2.5 million impairment charge associated with the write-off of Gaylord’s investment in Waipouli Holdings, LLC. Income from continuing operations in 2008 included a $12.0 million impairment charge related to the termination of the La Cantera acquisition. Income from continuing operations in 2007 included a $140.3 million gain on the sale of the Company’s interest in Bass Pro Group, LLC.
  • Adjusted EBITDA1 was $38.4 million in the fourth quarter of 2008 compared to $30.2 million in the prior-year quarter. For the full year 2008, Adjusted EBITDA was $147.2 million compared to $120.5 million in the prior year.
  • Consolidated Cash Flow2 (“CCF”) increased 19.5 percent to $48.4 million in the fourth quarter of 2008 compared to $40.5 million in the same period last year. CCF for the full year 2008 increased by 30.7 percent from 2007 to $198.0 million.
  • Corporate and Other CCF improved 18.4 percent for the fourth quarter of 2008 and 3.2 percent for the full year 2008 compared to the prior year periods.
  • Hospitality segment total revenue increased 23.7 percent to $232.9 million in the fourth quarter of 2008 compared to $188.4 million in the prior-year quarter, and same-store hospitality revenue decreased 3.8 percent to $181.3 million. Hospitality revenue for the full year 2008 increased 26.7 percent to $848.3 million, and same-store hospitality revenue increased 1.4 percent to $679.1 million. Gaylord Hotels full-year CCF increased 25.5 percent to $229.9 million, and full-year same-store CCF increased 7.4 percent to $196.8 million.
  • Gaylord Hotels revenue per available room3 (“RevPAR”) and total revenue per available room4 (“Total RevPAR”) decreased 8.0 percent and 8.9 percent, respectively, in the fourth quarter of 2008 compared to the fourth quarter of 2007. For the full year 2008, Gaylord Hotels’ RevPAR and Total RevPAR decreased 1.1 percent and 0.6 percent, respectively, compared to 2007.

Results for the fourth quarter and full year 2008 can be attributed primarily to the inclusion of the results of the Gaylord National Resort and Convention Center, which opened in April 2008, but were offset by lower revenues at the Company’s same-store hotels due to a deteriorating economy.

Reed continued, “This quarter caps a successful year for our brand. Most notably, we opened and are now receiving the benefits from the much-anticipated Gaylord National, which opened with more than 1.4 million room nights on the books. We have great confidence that this property will perform well for years to come.

“As we head into 2009, we understand that no business model is immune to the unprecedented market forces affecting the hospitality industry. Because of this, during 2008 we took several steps to ensure that our business will emerge from the current downturn in a strong state. We implemented numerous cost controls in operations that led to increased cash flow margins for our same-store hospitality operations and we made several changes to our corporate cost controls, the benefits of which can be seen in our fourth quarter results. Our cost control efforts resulted in corporate CCF improving approximately 18 percent in the fourth quarter compared to the fourth quarter of 2007. We also addressed the balance sheet, extending the maturity date of our $1 billion credit facility at favorable rates and reducing our debt by repurchasing $45.8 million of our Senior Notes at attractive prices.

“It is important to make clear that we remain cautious about how the market will play out in 2009, especially during the first quarter. As a result, we will continue efforts to reduce costs and aggressively manage our balance sheet with an eye toward conserving capital.”

Segment Operating Results

Hospitality

Key components of the Company’s hospitality segment performance in the fourth quarter and full year 2008 include:

  • Same-store RevPAR for the quarter decreased 6.4 percent compared to the prior-year quarter, driven primarily by a decrease in occupancy. Same-store Total RevPAR decreased 5.8 percent compared to the prior-year quarter, driven by the decline in occupancy and a decrease in food and beverage spending. Same-store RevPAR for the full year decreased 1.4 percent driven by a decrease in occupancy, which offset a 2.6 percent increase in Average Daily Rate (“ADR”). Same-store Total RevPAR decreased 0.8 percent compared to the prior year, as a result of the decline in occupancy and a decrease in food and beverage revenue which was partially offset by increases in attrition and cancellation fees.
  • Gaylord National generated RevPAR and Total RevPAR of $112.11 and $281.44 respectively in the fourth quarter of 2008. For the full year 2008, the National achieved RevPAR of $124.84 and Total RevPAR of $309.09.
  • Same-store CCF decreased 3.8 percent to $49.6 million for the quarter compared to the prior-year quarter. Same-store CCF for the year increased 7.4 percent compared to 2007 due to the Company’s continued focus on effective expense management and increased attrition and cancellation fees. Same-store CCF margin was flat compared to the fourth quarter of 2007 at 27.4 percent. Same-store CCF margin for the year increased 160 basis points to 29.0 percent compared to 27.4 percent in 2007. Gaylord National generated CCF of $8.4 million in the fourth quarter and $33.1 million for the full year 2008. (Gaylord National was fully operational as of April 2, 2008.)
  • Gaylord Hotels same-store net definite bookings for all future years decreased 52.2 percent to 263,397 room nights booked in the fourth quarter of 2008 compared to the same period in 2007. During the quarter, meeting planners deferred booking decisions for future periods and Gaylord Hotels continued to experience elevated levels of attrition and cancellation. Same-store attrition for the fourth quarter was 14.1 percent compared to 9.7 percent for the same period in 2007. Gaylord National net definite bookings for all future years declined 30.6 percent to 138,359 room nights booked in the fourth quarter of 2008 compared to the same period last year. Attrition in the fourth quarter at Gaylord National was 13.3 percent. For the full year 2008, all Gaylord Hotel properties booked 1,622,880 room nights for future periods, compared to 1,973,835 room nights in 2007. Room night production in 2008 reflects approximately 200,000 room nights related to the proposed hotel expansions.

Reed continued, “For the fourth quarter and the full year, as expected, Gaylord Hotels RevPAR and Total RevPAR experienced modest declines as some of our clients reduced spending. Despite acceleration in these trends as the fourth quarter ended, our hotels performed well. In fact, according to our data, we believe that we rank first versus our competitive set for Total RevPAR for the full-year 2008, underscoring the value and strength of our brand, quality of our service and the draw of the unique amenities and outside-the-room offerings we provide.”

At the property level, Gaylord Opryland generated revenue of $86.4 million in the fourth quarter of 2008, a slight decrease compared to the prior-year quarter. Full-year 2008 revenue of $296.7 million represented a 3.7 percent increase compared to 2007. Fourth quarter RevPAR decreased 7.1 percent to $125.61 compared to $135.16 in the same period last year, driven by a 6.5 percentage point decline in occupancy as a result of lower group volume, which offset an increase in transient business. Total RevPAR decreased 5.6 percent to $326.12 in the fourth quarter of 2008 compared to $345.50 in the prior-year quarter. For the full year 2008, RevPAR and Total RevPAR decreased 1.9 percent and 0.8 percent to $119.32 and $282.90, respectively. A 4.3 percentage point decrease in occupancy offset a 3.8 percent increase in ADR for the year. CCF increased 1.7 percent to $24.0 million for the fourth quarter, versus $23.6 million in the year-ago quarter. For the quarter, CCF margin increased 70 basis points over the prior-year quarter to 27.8 percent. Full-year 2008 CCF increased 17.8 percent due to increased revenue from food and beverage spending and collections of attrition and cancellation fees along with efficiency and cost control measures. Full-year 2007 CCF also includes a $2.9 million charge related to the termination of a tenant lease at Opryland. Full-year CCF margin was 28.6 percent, a 350 basis point increase over 2007. The Opryland room renovation was completed in February 2008 and therefore did not affect availability during the fourth quarter. Operating statistics reflect 5,171 room nights out of available inventory for the full year 2008, 12,712 room nights out of available inventory for the fourth quarter of 2007 and 48,752 room nights out of available inventory during the full year 2007.

Gaylord Palms posted revenue of $43.0 million in the fourth quarter of 2008, a 7.5 percent decrease compared to $46.5 million in the prior-year quarter. Occupancy for the quarter was relatively flat to the prior-year quarter due to an increase in transient business that offset a decline in group volume. Full-year 2008 revenue of $180.8 million represented a slight decrease compared to $181.8 million in 2007. Fourth quarter RevPAR decreased 7.2 percent to $120.05 compared to $129.35 in the same quarter last year, largely driven by a 5.2 percent decrease in ADR. Total RevPAR decreased 8.1 percent to $330.43, based on the lower ADR and a decrease in food and beverage revenue due to lower group spending. For the full year, RevPAR decreased 1.1 percent to $137.71 and Total RevPAR decreased 1.0 percent to $350.75. In the fourth quarter, CCF decreased to $10.8 million compared to $11.8 million in the prior-year quarter, resulting in a CCF margin of 25.2 percent, a 20 basis point decrease compared to the prior-year quarter. For the full year, CCF decreased slightly to $52.6 million compared to $52.8 million in 2007. CCF margin for the year increased 10 basis points to 29.1 percent.

Gaylord Texan revenue was $49.6 million in the fourth quarter of 2008, a decrease of 5.0 percent from $52.2 million in the prior-year quarter, largely driven by a 5.3 percentage point decline in occupancy and the resulting decrease in room and food and beverage revenue. For the full year, revenue decreased slightly to $192.7 million from $192.8 million in 2007. RevPAR in the fourth quarter decreased 6.0 percent to $119.87 due to the decline in occupancy, which offset a 1.6 percent increase in ADR. Total RevPAR decreased 5.0 percent to $356.66 compared to $375.60 in the prior-year quarter. For the year, RevPAR decreased slightly to $128.77 from $129.55 in 2007. Total RevPAR for the full year decreased slightly to $348.46 compared to $349.54 in 2007. CCF decreased 9.5 percent to $13.6 million in the fourth quarter of 2008, versus $15.0 million in the prior-year quarter, resulting in a 27.4 percent CCF margin, a 130 basis point decrease from the prior-year quarter. The decline in CCF was primarily due to a decrease in revenue for the quarter. For the full year, CCF increased 1.5 percent to $56.4 million for a CCF margin of 29.3 percent, a 50 basis point increase compared to the prior year.

Gaylord National generated revenue of $51.7 million in the fourth quarter of 2008 and $169.2 million for the full year. RevPAR was $112.11 in the fourth quarter and $124.84 for the full year 2008. Total RevPAR was $281.44 in the fourth quarter and $309.09 for the full year. CCF was $8.4 million in the fourth quarter of 2008, resulting in a 16.3 percent CCF margin. For the full year, CCF was $33.1 million, with a CCF margin of 19.6 percent. During the quarter, the property contracted an additional 138,359 room nights as compared to 199,632 room nights in the fourth quarter of 2007. As a result of construction delays during the opening of the property, full-year 2008 figures reflect 1,408 room nights out of available inventory.

Development Update

Gaylord Entertainment continues to make progress on the planned resort and convention hotel in Mesa, Arizona. The project is still in the early stages and specific details of the property and budget have not yet been determined. All plans remain subject to final approval by Gaylord’s board of directors.

Opry and Attractions

Opry and Attractions segment revenue decreased 14.5 percent to $17.7 million in the fourth quarter of 2008, compared to $20.7 million in the year-ago quarter. For the full year, revenue increased to $82.1 million compared to $77.8 million in 2007. The segment’s CCF decreased to $1.7 million in the fourth quarter of 2008 from $2.9 million in the prior-year quarter. Full-year CCF decreased by 12.7 percent to $10.8 million compared to 2007.

Corporate and Other

Corporate and Other operating loss totaled $19.2 million in the fourth quarter of 2008 compared to an operating loss of $16.7 million in the same period last year. The 2008 loss reflects a $4.7 million impairment charge related to the termination of the Chula Vista project. For the full year, the segment reported an operating loss of $71.3 million compared to an operating loss of $56.0 million in the prior year. Corporate and Other CCF in the fourth quarter of 2008 improved 18.4 percent to a loss of $11.3 million compared to a loss of $13.9 million in the same period last year. For the full year, CCF improved 3.2 percent to a loss of $42.8 million compared to a loss of $44.2 million in 2007.

Liquidity

As of December 31, 2008, the Company had long-term debt outstanding, including current portion, of $1,262.9 million and unrestricted and restricted cash of $2.2 million. At the end of the fourth quarter of 2008, $277.5 million of borrowings were undrawn under the Company’s $1.0 billion credit facility, and the lending banks had issued $10.3 million in letters of credit, which left $267.2 million of availability under the credit facility.

During the fourth quarter, Gaylord Entertainment recorded a pretax gain of approximately $20 million (approximately $13 million after tax) as a result of the repurchase of $45.8 million in aggregate principal amount of its outstanding senior notes ($28.5 million of 8 percent senior notes and $17.3 million of 6.75 percent senior notes) for $25.6 million in December 2008. The Company used available cash and borrowings under its revolving credit facility to finance the purchases and will consider additional repurchases of its Senior Notes from time to time depending on market conditions.

Outlook

The following business performance outlook is based on current information as of February 10, 2009. The Company does not expect to update guidance before next quarter’s earnings release. However, the Company may update its full business outlook or any portion thereof at any time for any reason.

Reed continued, “We are very proud of the results we produced in 2008: growing revenue in our hospitality segment, expanding our operating margins through a keen eye on cost control and reducing corporate overhead. We recognize 2009 will be a challenging year for our company as well as the overall hospitality industry from a revenue perspective, and as a result, we will continue our focus on cost management. We ended the year in an economic environment that continued to rapidly decelerate and since then, has shown no signs of improvement. Meeting planners are deferring decision making, shrinking the booking window for 2009 and 2010 business. We are redeploying our sales force to focus more of its efforts on 2009 and 2010 to address this change in booking behavior.

“We are adjusting our outlook for 2009 to reflect sales, cancellation and attrition activity that more accurately represents the trends we have seen in recent weeks. We are anticipating Gaylord Hotels same-store RevPAR in the first quarter of 2009 to decline 18 percent – 20 percent and same-store Total RevPAR to decline 17 percent – 19 percent when compared to performance in the first quarter of 2008. For the full year 2009, we are reducing same-store RevPAR and Total RevPAR to a decrease of 9 percent – 12 percent and 9 percent – 12 percent, respectively.

“The business environment has slowed dramatically in recent weeks. We are addressing the revenue challenges with aggressive cost management and thus far have identified approximately $30 – 35 million in cost reductions from our prior guidance which we believe we can implement in 2009 – some of which will be a reduction in corporate expenses and some of which will be realized in our properties. We believe it is prudent to reduce our same-store CCF guidance to $160 – 170 million and our CCF guidance on the Gaylord National to $60 – 70 million. The slowdown in consumer and group spending has also affected our Opry and Attractions segment, and as a result, we are reducing our CCF guidance on this segment to $12 – 13 million. We are adjusting our Corporate and Other CCF guidance for the year from a loss of $49 – 46 million to a loss of $44 – 40 million. As such, we expect total CCF to be in the range of $188 – 213 million.”

      2009 Prior   2009 New
Consolidated Cash Flow  
 
  Gaylord Hotels (Same Store)
$185 – 197 Million
$160 – 170 Million

Gaylord National
$65 – 75 Million
$60 – 70 Million

Opry and Attractions
$13 – 14 Million
$12 – 13 Million

Corporate and Other
$(49 – 46) Million   $(44 – 40) Million
Totals
$214 – 240 Million
$188 – 213 Million




 
Gaylord Hotels Same-Store RevPAR
(3)% – 0%
(12)% – (9)%
Gaylord Hotels Same-Store Total RevPAR
(2)% – 0%
(12)% – (9)%

Webcast and Replay

Gaylord Entertainment will hold a conference call to discuss this release today at 10 a.m. ET. Investors can listen to the conference call over the Internet at www.gaylordentertainment.com. To listen to the live call, please go to the Investor Relations section of the website (Investor Relations/Presentations, Earnings, and Webcasts) at least 15 minutes prior to the call to register, download and install any necessary audio software. For those who cannot listen to the live broadcast, a replay will be available shortly after the call and will run for at least 30 days.

About Gaylord Entertainment

Gaylord Entertainment (NYSE: GET), a leading hospitality and entertainment company based in Nashville, Tenn., owns and operates Gaylord Hotels (www.gaylordhotels.com), its network of upscale, meetings-focused resorts, and the Grand Ole Opry (www.opry.com), the weekly showcase of country music’s finest performers for more than 80 consecutive years. The Company's entertainment brands and properties include the Radisson Hotel Opryland, Ryman Auditorium, General Jackson Showboat, Gaylord Springs Golf Links, Wildhorse Saloon, and WSM-AM. For more information about the Company, visit www.GaylordEntertainment.com.

This press release contains statements as to the Company’s beliefs and expectations of the outcome of future events that are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from the statements made. These include the risks and uncertainties associated with economic conditions affecting the hospitality business generally, the timing of the opening of new hotel facilities, increased costs and other risks associated with building and developing new hotel facilities, the geographic concentration of our hotel properties, business levels at the Company’s hotels, our ability to successfully operate our hotels and our ability to obtain financing for new developments. Other factors that could cause operating and financial results to differ are described in the filings made from time to time by the Company with the Securities and Exchange Commission and include the risk factors described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2007. The Company does not undertake any obligation to release publicly any revisions to forward-looking statements made by it to reflect events or circumstances occurring after the date hereof or the occurrence of unanticipated events.

1 Adjusted EBITDA (defined as earnings before interest, taxes, depreciation, amortization, as well as certain unusual items) is a non-GAAP financial measure which is used herein because we believe it allows for a more complete analysis of operating performance by presenting an analysis of operations separate from the earnings impact of capital transactions and without certain items that do not impact our ongoing operations such as the effect of the changes in fair value of the Viacom and CBS stock we formerly owned and changes in the fair value of the derivative associated with the secured forward exchange contract prior to its maturity in May 2007 and gains on the sale of assets. In accordance with generally accepted accounting principles, the changes in fair value of the Viacom and CBS stock and derivatives were not included in determining our operating income (loss). The information presented should not be considered as an alternative to any measure of performance as promulgated under accounting principles generally accepted in the United States (such as operating income, net income, or cash from operations), nor should it be considered as an indicator of overall financial performance. Adjusted EBITDA does not fully consider the impact of investing or financing transactions, as it specifically excludes depreciation and interest charges, which should also be considered in the overall evaluation of our results of operations. Our method of calculating Adjusted EBITDA may be different from the method used by other companies and therefore comparability may be limited. A reconciliation of Adjusted EBITDA to net income is presented in the Supplemental Financial Results contained in this press release.

2As discussed in footnote 1 above, Adjusted EBITDA is used herein as essentially operating income plus depreciation and amortization. Consolidated Cash Flow (which is used in this release as that term is defined in the Indentures governing the Company’s 8 percent and 6.75 percent senior notes) is a non-GAAP financial measure which also excludes the impact of pre-opening costs, impairment charges, the non-cash portion of the Florida ground lease expense, stock option expense, the non-cash gains and losses on the termination of certain interest rate swaps and the disposal of certain fixed assets and our investment in Bass Pro, and adds (subtracts) other gains (losses). The Consolidated Cash Flow measure is one of the principal tools used by management in evaluating the operating performance of the Company’s business and represents the method by which the Indentures calculate whether or not the Company can incur additional indebtedness (for instance in order to incur certain additional indebtedness, Consolidated Cash Flow for the most recent four fiscal quarters as a ratio to debt service must be at least 2 to 1). The calculation of these amounts as well as a reconciliation of those amounts to net income or segment operating income is included as part of the Supplemental Financial Results contained in this press release. CCF Margin is defined as CCF divided by revenue.

3The Company calculates revenue per available room (“RevPAR”) for its hospitality segment by dividing room sales by room nights available to guests for the period.

4The Company calculates total revenue per available room (“Total RevPAR”) by dividing the sum of room sales, food & beverage, and other ancillary services revenue by room nights available to guests for the period.



 
 
 
 
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
(In thousands, except per share data)









 









 









 



Three Months Ended
Twelve Months Ended



Dec. 31,
Dec. 31,



2008   2007
2008   2007
Revenues
$ 250,632

$ 209,064

$ 930,869

$ 747,723
Operating expenses:








Operating costs

156,447


126,070


566,366


448,975

Selling, general and administrative (a) (b)

48,590


45,389


178,809


160,699

Impairment charges

7,233


-


19,264


-

Preopening costs

-


7,417


19,190


17,518

Depreciation and amortization
  29,946       19,562  
  109,774       77,349  

Operating income
  8,416       10,626  
  37,466       43,182  









 
Interest expense, net of amounts capitalized

(20,024 )

(3,023 )

(64,069 )

(38,536 )
Interest income

4,106


467


12,689


3,234
Unrealized gain on Viacom stock and CBS stock

-


-


-


6,358
Unrealized gain on derivatives

-


-


-


3,121
(Loss) income from unconsolidated companies

(453 )

(47 )

(746 )

964
Gain on extinguishment of debt

19,862


-


19,862


-
Other gains and (losses), net (c)
  (501 )     (367 )
  453       146,330  









 

Income before provision for income taxes

11,406


7,656


5,655


164,653









 
Provision for income taxes
  1,991       2,137  
  1,046       62,665  









 

Income from continuing operations

9,415


5,519


4,609


101,988









 
(Loss) income from discontinued operations, net of taxes
  (1,012 )     (1,761 )
  (245 )     9,923  









 

Net income
$ 8,403     $ 3,758  
$ 4,364     $ 111,911  









 









 

Basic net income per share:










Income from continuing operations
$ 0.23

$ 0.13

$ 0.11

$ 2.49

(Loss) income from discontinued operations, net of taxes
  (0.02 )     (0.04 )
  -       0.24  

Net income
$ 0.21     $ 0.09  
$ 0.11     $ 2.73  









 

Fully diluted net income per share:










Income from continuing operations
$ 0.23

$ 0.13

$ 0.11

$ 2.41

(Loss) income from discontinued operations, net of taxes


  (0.03 )     (0.04 )
  -       0.24  

Net income
$ 0.20     $ 0.09  
$ 0.11     $ 2.65  









 

Weighted average common shares for the period:










Basic

40,882


41,187


40,943


41,010

Fully-diluted

41,081


42,348


41,257


42,293









 









 









 
(a) Includes non-cash lease expense of $1,530 and $1,557 for the three months ended December 31, 2008 and 2007, respectively, and $6,120 and $6,213 for the twelve months ended December 31, 2008 and 2007, respectively, related to the effect of recognizing the Gaylord Palms ground lease expense on a straight-line basis.









 
(b) Includes a non-recurring $2,862 charge to terminate a tenant lease related to certain food and beverage space at Gaylord Opryland for the twelve months ended December 31, 2007.









 
(c) Includes a non-recurring $1,276 gain related to the termination of certain interest rate swaps for the twelve months ended December 31, 2008. Includes a non-recurring $140,313 gain related to the sale of Company's investment in Bass Pro Group, LLC and a non-recurring $4,437 gain related to the sale of corporate assets for the twelve months ended December 31, 2007.
 
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited
(In thousands)
   

 
 





Dec. 31,
Dec. 31,





2008
2007
ASSETS

Current assets:




Cash and cash equivalents - unrestricted
$ 1,043
$ 23,592

Cash and cash equivalents - restricted

1,165

1,216

Trade receivables, net

49,114

31,371

Deferred income taxes

6,266

7,689

Other current assets

50,793

30,180

Current assets of discontinued operations
  197
  797


Total current assets

108,578

94,845







 
Property and equipment, net of accumulated depreciation

2,227,574

2,196,264
Notes receivable

146,866

-
Intangible assets, net of accumulated amortization

121

174
Goodwill


6,915

6,915
Indefinite lived intangible assets

1,480

1,480
Investments

1,131

4,143
Estimated fair value of derivative assets

6,235

2,043
Long-term deferred financing costs

18,888

14,621
Other long-term assets
  42,591
  28,019







 

Total assets
$ 2,560,379
$ 2,348,504







 







 







 







 
LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:




Current portion of long-term debt and capital lease obligations
$ 1,904
$ 2,058

Accounts payable and accrued liabilities

168,155

240,827

Estimated fair value of derivative liabilities

1,606

-

Current liabilities of discontinued operations
  1,329
  2,760


Total current liabilities

172,994

245,645







 
Long-term debt and capital lease obligations, net of current portion

1,260,997

979,042
Deferred income taxes

62,656

73,662
Estimated fair value of derivative liabilities

28,489

-
Other long-term liabilities

131,578

108,121
Long-term liabilities and minority interest of discontinued operations

446

542
Stockholders' equity
  903,219
  941,492







 

Total liabilities and stockholders' equity
$ 2,560,379
$ 2,348,504
 
 
 
 
 
 
 
 
 
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL RESULTS
Unaudited
(in thousands, except operating metrics)

















 

















 

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") and Consolidated Cash Flow ("CCF") reconciliation:
Three Months Ended Dec. 31,
Twelve Months Ended Dec. 31,



2008
2007
2008
2007



$
Margin
$
Margin
$
Margin
$
Margin

Consolidated


















Revenue
$ 250,632

100.0 %
$ 209,064

100.0 %
$ 930,869

100.0 %
$ 747,723

100.0 %

















 

Net income
$ 8,403

3.4 %
$ 3,758

1.8 %
$ 4,364

0.5 %
$ 111,911

15.0 %

Loss (income) from discontinued operations, net of taxes

1,012

0.4 %

1,761

0.8 %

245

0.0 %

(9,923 )
-1.3 %

Provision for income taxes

1,991

0.8 %

2,137

1.0 %

1,046

0.1 %

62,665

8.4 %

Other (gains) and losses, net

501

0.2 %

367

0.2 %

(453 )
0.0 %

(146,330 )
-19.6 %

Gain on extinguishment of debt

(19,862 )
-7.9 %

-

0.0 %

(19,862 )
-2.1 %

-

0.0 %

Loss (income) from unconsolidated companies

453

0.2 %

47

0.0 %

746

0.1 %

(964 )
-0.1 %

Unrealized gain on derivatives

-

0.0 %

-

0.0 %

-

0.0 %

(3,121 )
-0.4 %

Unrealized gain on Viacom stock and CBS stock

-

0.0 %

-

0.0 %

-

0.0 %

(6,358 )
-0.9 %

Interest expense, net
  15,918  
6.4 %
  2,556  
1.2 %
  51,380  
5.5 %
  35,302  
4.7 %

Operating income (1)

8,416

3.4 %

10,626

5.1 %

37,466

4.0 %

43,182

5.8 %

Depreciation & amortization
  29,946  
11.9 %
  19,562  
9.4 %
  109,774  
11.8 %
  77,349  
10.3 %

Adjusted EBITDA

38,362

15.3 %

30,188

14.4 %

147,240

15.8 %

120,531

16.1 %

Pre-opening costs

-

0.0 %

7,417

3.5 %

19,190

2.1 %

17,518

2.3 %

Impairment charges

7,233

2.9 %

-

0.0 %

19,264

2.1 %

-

0.0 %

Other non-cash expenses

1,530

0.6 %

1,557

0.7 %

6,120

0.7 %

6,213

0.8 %

Stock option expense

1,655

0.7 %

1,361

0.7 %

6,604

0.7 %

5,431

0.7 %

Other gains and (losses), net (2)

(501 )
-0.2 %

(367 )
-0.2 %

453

0.0 %

146,330

19.6 %

Gain on termination of interest rate swap

-

0.0 %

-

0.0 %

(1,276 )
-0.1 %

-

0.0 %

Gain on sale of investment in Bass Pro

-

0.0 %

-

0.0 %

-

0.0 %

(140,313 )
-18.8 %

Losses and (gains) on sales of assets
  159  
0.1 %
  378  
0.2 %
  416  
0.0 %
  (4,184 )
-0.6 %

CCF
$ 48,438  
19.3 %
$ 40,534  
19.4 %
$ 198,011  
21.3 %
$ 151,526  
20.3 %

















 

Hospitality segment


















Revenue
$ 232,940

100.0 %
$ 188,351

100.0 %
$ 848,332

100.0 %
$ 669,743

100.0 %

Operating income (1)

27,162

11.7 %

25,838

13.7 %

103,139

12.2 %

92,608

13.8 %

Depreciation & amortization

26,500

11.4 %

16,364

8.7 %

97,229

11.5 %

65,369

9.8 %

Pre-opening costs

-

0.0 %

7,417

3.9 %

19,190

2.3 %

17,518

2.6 %

Impairment charges

2,499

1.1 %

-

0.0 %

2,499

0.3 %

-

0.0 %

Other non-cash expenses

1,530

0.7 %

1,557

0.8 %

6,120

0.7 %

6,213

0.9 %

Stock option expense

498

0.2 %

381

0.2 %

1,990

0.2 %

1,552

0.2 %

Other losses, net

(224 )
-0.1 %

(240 )
-0.1 %

(322 )
0.0 %

(236 )
0.0 %

Losses on sales of assets
  52  
0.0 %
  240  
0.1 %
  85  
0.0 %
  240  
0.0 %

CCF
$ 58,017  
24.9 %
$ 51,557  
27.4 %
$ 229,930  
27.1 %
$ 183,264  
27.4 %

















 

Hospitality segment (Same Store)


















Revenue
$ 181,258

100.0 %




$ 679,108

100.0 %




Operating income (1)

27,043

14.9 %





113,547

16.7 %




Depreciation & amortization

18,290

10.1 %





72,464

10.7 %




Pre-opening costs

-

0.0 %





702

0.1 %




Impairment charges

2,499

1.4 %





2,499

0.4 %




Other non-cash expenses

1,530

0.8 %





6,120

0.9 %




Stock option expense

428

0.2 %





1,686

0.2 %




Other losses, net

(219 )
-0.1 %





(317 )
0.0 %




Losses on sales of assets
  47  
0.0 %




  80  
0.0 %




CCF
$ 49,618  
27.4 %




$ 196,781  
29.0 %




















 

Gaylord National


















Revenue
$ 51,682

100.0 %




$ 169,224

100.0 %




Operating income(loss)

119

0.2 %





(10,408 )
-6.2 %




Depreciation & amortization

8,210

15.9 %





24,765

14.6 %




Pre-opening costs

-

0.0 %





18,488

10.9 %




Stock option expense

70

0.1 %





304

0.2 %




Other losses, net

(5 )
0.0 %





(5 )
0.0 %




Losses on sales of assets
  5  
0.0 %




  5  
0.0 %




CCF
$ 8,399  
16.3 %




$ 33,149  
19.6 %




















 

Opry and Attractions segment


















Revenue
$ 17,665

100.0 %
$ 20,661

100.0 %
$ 82,125

100.0 %
$ 77,769

100.0 %

Operating income

503

2.8 %

1,462

7.1 %

5,641

6.9 %

6,600

8.5 %

Depreciation & amortization

1,165

6.6 %

1,320

6.4 %

4,894

6.0 %

5,500

7.1 %

Stock option expense

81

0.5 %

76

0.4 %

302

0.4 %

307

0.4 %

Other losses, net

(71 )
-0.4 %

(39 )
-0.2 %

(90 )
-0.1 %

(27 )
0.0 %

Losses on sales of assets
  71  
0.4 %
  39  
0.2 %
  90  
0.1 %
  39  
0.1 %

CCF
$ 1,749  
9.9 %
$ 2,858  
13.8 %
$ 10,837  
13.2 %
$ 12,419  
16.0 %

















 

Corporate and Other segment


















Revenue
$ 27



$ 52



$ 412



$ 211



Operating loss

(19,249 )



(16,674 )



(71,314 )



(56,026 )


Depreciation & amortization

2,281




1,878




7,651




6,480



Impairment charges

4,734




-




16,765




-



Stock option expense

1,076




904




4,312




3,572



Other gains and (losses), net (2)

(206 )



(88 )



865




146,593



Gain on termination of interest rate swap

-




-




(1,276 )



-



Gain on sale of investment in Bass Pro

-




-




-




(140,313 )


Losses (gains) on sales of assets
  36  
 
  99  
 
  241  
 
  (4,463 )
 

CCF
$ (11,328 )
 
$ (13,881 )
 
$ (42,756 )
 
$ (44,157 )
 

















 

















 

















 

(1) Includes a non-recurring $2,862 charge to terminate a tenant lease related to certain food and beverage space at Gaylord Opryland for the twelve months ended December 31, 2007.

















 

(2) Includes a non-recurring $1,276 gain related to the termination of certain interest rate swaps for the twelve months ended December 31, 2008. Includes a non-recurring $140,313 gain related to the sale of Company's investment in Bass Pro Group, LLC and a non-recurring $4,437 gain related to the sale of corporate assets for the twelve months ended December 31, 2007.
 
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL RESULTS
Unaudited
(in thousands, except operating metrics)

 
 


 


     
     


Three Months Ended Dec. 31, Twelve Months Ended Dec. 31,


2008
2007
2008
2007








 
HOSPITALITY OPERATING METRICS:















 

Gaylord Hospitality Segment (1) (2)

















 
Occupancy

68.3 %

77.7 %

72.1 %

77.7 %
Average daily rate (ADR)
$ 173.30

$ 165.72

$ 171.47

$ 160.94
RevPAR
$ 118.39

$ 128.75

$ 123.70

$ 125.13
OtherPAR
$ 194.55

$ 214.59

$ 182.08

$ 182.36
Total RevPAR
$ 312.94

$ 343.34

$ 305.78

$ 307.49








 
Revenue
$ 232,940

$ 188,351

$ 848,332

$ 669,743
CCF (3)
$ 58,017

$ 51,557

$ 229,930

$ 183,264
CCF Margin

24.9 %

27.4 %

27.1 %

27.4 %








 

Gaylord Opryland (1)

















 
Occupancy

76.6 %

83.1 %

75.9 %

80.2 %
Average daily rate (ADR)
$ 163.95

$ 162.69

$ 157.30

$ 151.50
RevPAR
$ 125.61

$ 135.16

$ 119.32

$ 121.57
OtherPAR
$ 200.51

$ 210.34

$ 163.58

$ 163.65
Total RevPAR
$ 326.12

$ 345.50

$ 282.90

$ 285.22








 
Revenue
$ 86,380

$ 87,185

$ 296,666

$ 286,021
CCF (3)
$ 23,992

$ 23,600

$ 84,722

$ 71,927
CCF Margin

27.8 %

27.1 %

28.6 %

25.1 %








 

Gaylord Palms

















 
Occupancy

72.2 %

73.7 %

77.2 %

77.1 %
Average daily rate (ADR)
$ 166.31

$ 175.43

$ 178.42

$ 180.52
RevPAR
$ 120.05

$ 129.35

$ 137.71

$ 139.18
OtherPAR
$ 210.38

$ 230.10

$ 213.04

$ 215.12
Total RevPAR
$ 330.43

$ 359.45

$ 350.75

$ 354.30








 
Revenue
$ 43,011

$ 46,496

$ 180,777

$ 181,826
CCF
$ 10,838

$ 11,802

$ 52,592

$ 52,820
CCF Margin

25.2 %

25.4 %

29.1 %

29.0 %








 

Gaylord Texan

















 
Occupancy

66.8 %

72.1 %

72.0 %

74.9 %
Average daily rate (ADR)
$ 179.55

$ 176.79

$ 178.88

$ 172.92
RevPAR
$ 119.87

$ 127.50

$ 128.77

$ 129.55
OtherPAR
$ 236.79

$ 248.10

$ 219.69

$ 219.99
Total RevPAR
$ 356.66

$ 375.60

$ 348.46

$ 349.54








 
Revenue
$ 49,579

$ 52,212

$ 192,706

$ 192,777
CCF
$ 13,568

$ 14,990

$ 56,384

$ 55,528
CCF Margin

27.4 %

28.7 %

29.3 %

28.8 %








 

Gaylord National (2)

















 
Occupancy

54.3 %

n/a


61.6 %

n/a
Average daily rate (ADR)
$ 206.55


n/a

$ 202.72


n/a
RevPAR
$ 112.11


n/a

$ 124.84


n/a
OtherPAR
$ 169.33


n/a

$ 184.25


n/a
Total RevPAR
$ 281.44


n/a

$ 309.09


n/a








 
Revenue
$ 51,682


n/a

$ 169,224


n/a
CCF
$ 8,399


n/a

$ 33,149


n/a
CCF Margin

16.3 %

n/a


19.6 %

n/a








 

Nashville Radisson and Other (4)

















 
Occupancy

71.7 %

75.1 %

66.4 %

72.2 %
Average daily rate (ADR)
$ 103.25

$ 98.88

$ 103.19

$ 97.08
RevPAR
$ 74.04

$ 74.23

$ 68.54

$ 70.09
OtherPAR
$ 14.58

$ 13.90

$ 14.43

$ 12.22
Total RevPAR
$ 88.62

$ 88.13

$ 82.97

$ 82.31








 
Revenue
$ 2,288

$ 2,458

$ 8,959

$ 9,119
CCF
$ 1,220

$ 1,165

$ 3,083

$ 2,989
CCF Margin

53.3 %

47.4 %

34.4 %

32.8 %








 

Gaylord Hospitality Segment "Same Store" (excludes Gaylord National for Three Months and Twelve Months Ended December 31) (1)









 
Occupancy

72.9 %

77.7 %

74.7 %

77.7 %
Average daily rate (ADR)
$ 165.20

$ 165.72

$ 165.14

$ 160.94
RevPAR
$ 120.45

$ 128.75

$ 123.42

$ 125.13
OtherPAR
$ 202.81

$ 214.59

$ 181.55

$ 182.36
Total RevPAR
$ 323.26

$ 343.34

$ 304.97

$ 307.49








 
Revenue
$ 181,258

$ 188,351

$ 679,108

$ 669,743
CCF (3)
$ 49,618

$ 51,557

$ 196,781

$ 183,264
CCF Margin

27.4 %

27.4 %

29.0 %

27.4 %








 








 
(1) Excludes 12,712 room nights that were taken out of service during the three months ended December 31, 2007, and 5,171 and 48,752 room nights that were taken out of service during the twelve months ended December 31, 2008 and 2007, respectively, as a result of the rooms renovation program at Gaylord Opryland.








 
(2) Excludes 1,408 room nights that were not in service during the twelve months ended December 31, 2008 as these rooms were not released from construction at the opening of Gaylord National.








 
(3) Includes a non-recurring $2,862 charge to terminate a tenant lease related to certain food and beverage space at Gaylord Opryland for the twelve months ended December 31, 2007.








 
(4) Includes other hospitality revenue and expense.
 
Gaylord Entertainment Company and Subsidiaries
Reconciliation of Forward-Looking Statements
Unaudited
(in thousands, except operating metrics)
   
 
 
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA")
and Consolidated Cash Flow ("CCF") reconciliation:









 




GUIDANCE RANGE




FULL YEAR 2009

Hospitality Segment (same store)


Low
High


Estimated Operating Income/(Loss)
$87,500

$94,750


Estimated Depreciation & Amortization
65,000  
67,000  


Estimated Adjusted EBITDA
$152,500

$161,750


Estimated Pre-Opening Costs
0

0


Estimated Non-Cash Lease Expense
5,900

6,100


Estimated Stock Option Expense
1,600

2,000


Estimated Gains/(Losses), Net
0  
150  


Estimated CCF
$160,000  
$170,000  






 

Gaylord National







Estimated Operating Income/(Loss)
$28,700

$36,550


Estimated Depreciation & Amortization
31,000  
33,000  


Estimated Adjusted EBITDA
$59,700

$69,550


Estimated Pre-Opening Costs
0

0


Estimated Stock Option Expense
300

350


Estimated Gains/(Losses), Net
0  
100  


Estimated CCF
$60,000  
$70,000  






 

Opry and Attractions segment







Estimated Operating Income/(Loss)
$7,000

$7,700


Estimated Depreciation & Amortization
4,700  
4,800  


Estimated Adjusted EBITDA
$11,700

$12,500


Estimated Stock Option Expense
300

450


Estimated Gains/(Losses), Net
0  
50  


Estimated CCF
$12,000  
$13,000  






 

Corporate and Other segment







Estimated Operating Income/(Loss)
($58,000 )
($53,200 )


Estimated Depreciation & Amortization
9,600  
9,000  


Estimated Adjusted EBITDA
($48,400 )
($44,200 )


Estimated Stock Option Expense
4,400

4,000


Estimated Gains/(Losses), Net
0  
200  


Estimated CCF
($44,000 )
($40,000 )
.
Contact:

Gaylord Entertainment
David Kloeppel, 615-316-6101
President and CFO
dkloeppel@gaylordentertainment.com

Mark Fioravanti, 615-316-6588
Senior Vice President of Finance and Treasurer
mfioravanti@gaylordentertainment.com  
 
.
.
Also See: Gaylord Reports Only a Modest Decline in Business Volumes for November and December 2008; All Claims with Perini over Construction of Gaylord National Resort Settled, Final Cost Approximately $1,050 million / January 2009
.

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