|
SPOKANE, Wash., May 5, 2011\-- Red Lion Hotels Corporation
(NYSE: RLH), a western U.S.-based owner and franchisor of midscale
hotels, announced its results for the first quarter ended March 31, 2011.
Overview:
- Signed definitive agreement to sell Seattle Fifth Avenue
property for $71 million
- RevPAR for owned and leased hotels increased 0.2 percent
year over year
- ADR for owned and leased hotels up 0.3 percent year over
year
- Occupancy remained steady year over year with transient
growth offsetting anticipated group decline
- EBITDA loss of $0.2 million
Total revenue during the first quarter was $34.3 million, consistent with the prior year
period results. Revenue from hotels of $30.2
million declined slightly from $30.6
million in the prior year period. EBITDA from continuing
operations before special items for the first quarter of 2011 was a
loss of $0.2 million, compared to $1.9 million for the first quarter of 2010.
Net loss from continuing operations was $4.8
million in the quarter, or $0.25
per share, compared to a loss of $4.2 million,
or $0.23 per share, for the prior year
period.
"This week, we were able to sign an attractive agreement to
sell our Seattle Fifth Avenue hotel to a new owner affiliated with Lowe
Enterprises and its management company, Destination Hotels &
Resorts," said President and Chief Executive Officer Jon E. Eliassen. "Both companies are highly
regarded in the hospitality industry. They will operate the hotel under
a franchise agreement with Red Lion, maintaining our presence in
downtown Seattle. Upon the closing of
this transaction, we will have successfully monetized a valuable asset
in an important step in our strategy to recapitalize our balance
sheet."
Eliassen continued, "Turning to our first quarter results, as
anticipated, group demand softened in many of our markets. However, we
were able to largely offset the group decline with strong transient
performance enabling us to maintain RevPAR year over year. As we move
through the year, we are cautiously optimistic that we will be able to
leverage stronger revenue performance to drive improved profitability."
Summary results for the three-month period follow:
|
($ in
thousands, except per share)
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
2011
|
2010
|
%
change
|
|
|
|
|
|
|
|
|
Total
revenue, as reported
|
$
34,272
|
$
34,302
|
-0.1%
|
|
|
|
|
|
|
|
|
Results
before special items: (1)
|
|
|
|
|
|
EBITDA from continuing operations
|
$ (153)
|
$ 1,872
|
-108.2%
|
|
|
Net
income (loss) from continuing operations
|
$
(4,771)
|
$
(3,439)
|
-38.7%
|
|
|
Earnings (loss) per share from continuing operations
|
$
(0.25)
|
$
(0.18)
|
-38.9%
|
|
|
|
|
|
|
|
|
Results
as reported:
|
|
|
|
|
|
EBITDA from continuing operations
|
$ (153)
|
$ 653
|
-123.4%
|
|
|
Net
income (loss) from continuing operations
|
$
(4,771)
|
$
(4,225)
|
-12.9%
|
|
|
Earnings (loss) per share from continuing operations
|
$
(0.25)
|
$
(0.23)
|
-8.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Excludes $1.2 million of expense related to the separation of the
company's former President and Chief Executive Officer recorded in the
first quarter of 2010.
|
|
|
In addition, key hotel operating metrics from continuing
operations presented on a comparable basis, and reported hotel revenues
and operating margin for the first quarter ended March
31, 2011 and March 31, 2010, are
highlighted below for owned and leased hotels:
|
|
Three
months ended March 31,
|
|
|
|
2011
|
2010
|
change
|
|
|
|
|
|
|
|
|
RevPAR
(revenue per available room)
|
$ 38.69
|
$ 38.63
|
0.2%
|
|
|
ADR
(average daily rate)
|
$ 80.34
|
$ 80.10
|
0.3%
|
|
|
Occupancy
|
48.2%
|
48.2%
|
-
|
|
|
|
|
|
|
|
|
Hotels
revenue:
|
|
|
|
|
|
Rooms
|
$
21,314
|
$
21,281
|
0.2%
|
|
|
Food
and beverage
|
7,831
|
8,398
|
-6.8%
|
|
|
Other
revenue
|
1,013
|
942
|
7.5%
|
|
|
Total
hotels revenue
|
$
30,158
|
$
30,621
|
-1.5%
|
|
|
|
|
|
|
|
|
Hotel
direct operating margin
|
9.9%
|
13.2%
|
-25.0%
|
|
|
|
|
|
|
First Quarter 2011 Results
Comparing the first quarter of 2011 to the first quarter of
2010, occupancy for owned and leased hotels remained flat at 48.2
percent. ADR increased slightly to $80.34,
resulting in a 0.2 percent increase in RevPAR.
Including franchised hotels, system wide RevPAR on a
comparable basis for the quarter increased 2.1 percent due to a 110
basis point increase in occupancy, partially offset by a 0.2 percent
decline in ADR.
Revenue from hotels of $30.2 million
was down slightly compared to the prior year period. This was primarily
due to a $0.6 million, or 7 percent,
decline in food and beverage revenue, mainly as a result of reduced
banquet business given lower group occupancy during the quarter. Rooms
revenue was essentially flat at $21.3 million
year over year as an increase in the transient segment largely offset a
decline in group business. Hotel direct operating margin declined to
9.9 percent during the quarter from 13.2 percent in the same period in
2010 due primarily to the decline in food and beverage revenues and an
increase in sales & marketing, utility and food costs.
Revenue from the entertainment segment increased $0.3 million to $2.8 million, driven by an
increase in the number of shows in the quarter versus the prior year.
However, operating margin for the segment declined by $0.3 million primarily driven by lower
revenues and increased expenses of the ticketing portion of the
business.
Revenue from the franchise segment increased $0.1 million in the first quarter to $0.7 million. The segment showed a $0.2 million decline in operating margin as a
result of increased investment to grow and support the business and
additional expenses associated with the change in operators at the Sacramento franchise.
Liquidity and Balance Sheet
As of March 31, 2011, the
company had approximately $5.6 million
in cash and cash equivalents, and outstanding debt of $132.1 million, $50.0
million of which is classified as current.
Capital expenditures during the first quarter totaled $0.4 million for necessary hotel improvement
projects.
On March 25, 2011, KeyBank
National Association acquired all of the interests of the other lenders
under the company's $30 million
revolving credit facility and the covenants were simultaneously amended.
During the quarter, the company announced plans to offer for
sale its Red Lion Colonial Hotel, located in Helena,
Montana. The company expects to use the proceeds from the sale
to pay down debt while redeploying the equity in the property to
enhance the Red Lion brand. The company expects to maintain the hotel's
Red Lion affiliation, either as a managed or franchised property or
both.
The company has presented the assets of its Seattle Fifth
Avenue and its Helena, Montana
properties as "Assets Held for Sale" on its balance sheet at March 31, 2011. The assets of the Denver
Southeast property did not meet all criteria for this classification
and thus continue to be presented as non-current assets in the
company's property and equipment line on the balance sheet.
Franchise Update
The company continues to focus on the strategy of growing the
Red Lion brand through franchising. The previously announced Red Lion
Inn Rancho Cordova near Sacramento is
scheduled to open within the next few weeks. Last week, the owner of
the Red Lion Hotel Concord – Walnut Creek
franchise unexpectedly closed the hotel. While the company currently
has no further information about the Concord
property, it is willing to consider future involvement, if that is an
option.
Subsequent Event
On May 4, 2011, the company
announced it has entered into a definitive agreement to sell its Red
Lion Hotel on Fifth Avenue to an affiliate of Lowe Enterprises ("Lowe")
for $71 million. The buyers are entering
into a franchise agreement with Red Lion Hotels Franchising Inc. and
the hotel will continue to operate as a Red Lion, managed by Lowe's
hospitality management subsidiary, Destination Hotels & Resorts. In
addition to the franchise agreement, the company is entering into an
affiliation agreement with a subsidiary of Destination Hotels &
Resorts to facilitate the cross-promotion of hotels between the
companies. The company currently anticipates that the closing will
occur by the end of the second quarter.
Outlook for 2011
The company is reaffirming its RevPAR guidance for 2011,
previously provided on March 2, 2011,
based on the outlook for the markets in which the company operates and
information available today:
- Full year 2011 RevPAR for company owned and leased hotels
is expected to increase 3 to 5 percent compared to 2010 on an annual
basis.
- The company expects to invest approximately $11.0 million in capital improvements in 2011.
Conference Call Information
The company will hold a conference call at 2:00 p.m. Pacific Time (5:00
p.m. Eastern Time) on Thursday, May 5,
2011 to discuss the results for investors, analysts and
portfolio managers. Hosting the call will be President and Chief
Executive Officer Jon E. Eliassen and
Executive Vice President and Chief Financial Officer Dan Jackson. Executive Vice President and
Chief Operating Officer George Schweitzer
will also be available to answer questions.
To participate in the conference call, please dial the
following number ten minutes prior to the scheduled time: (800)
288-9626. International callers should dial (612) 332-0345.
This conference call will also be webcast live at http://www.redlion.com in the
Investor Relations section of the website. To listen to the live call,
please go to the Red Lion website at least fifteen minutes prior to the
start of the call to register and to download and install any necessary
audio software. For those unable to participate during the live
broadcast, a replay will be available at 4:00
p.m. Pacific Time on May 5, 2011,
through June 5, 2011 at (USA) (800) 475-6701 or (International)
(320) 365-3844 access code - 201843. The replay will also be available
shortly after the call on the Red Lion website.
About Red Lion Hotels Corporation:
Red Lion Hotels Corporation is a hospitality and leisure
Company primarily engaged in the ownership, operation and franchising
of midscale hotels under its Red Lion® brand. As of March 31, 2011, the RLH hotel network was
comprised of 45 hotels located in eight states and one Canadian
province, with 8,630 rooms and 429,797 square feet of meeting space.
The Company also owns and operates an entertainment and event ticket
distribution business. For more information, please visit the Company's
website at www.redlion.com.
This press release contains forward-looking statements
within the meaning of federal securities law, including statements
concerning plans, objectives, goals, strategies, projections of future
events or performance and underlying assumptions (many of which are
based, in turn, upon further assumptions). The forward-looking
statements in this press release are inherently subject to a variety of
risks and uncertainties that could cause actual results to differ
materially from those expressed. Such risks and uncertainties include,
among others, economic cycles; international conflicts; changes in
future demand and supply for hotel rooms; competitive conditions in the
lodging industry; relationships with franchisees and properties; impact
of government regulations; ability to obtain financing; changes in
energy, healthcare, insurance and other operating expenses; ability to
sell non-core assets; ability to locate lessees for rental property;
dependency upon the ability and experience of executive officers and
ability to retain or replace such officers as well as other matters
discussed in the Company's annual report on Form 10-K for the year
ended December 31, 2010 and in other
documents filed by the Company with the Securities and Exchange
Commission.
|
Red
Lion Hotels Corporation
|
|
|
|
Consolidated
Statements of Operations
|
|
|
|
(unaudited)
|
|
|
|
($ in
thousands, except footnotes)
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
2011
|
2010
|
$
Change
|
%
Change
|
|
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
Hotels
|
$
30,158
|
$
30,621
|
$ (463)
|
-1.5%
|
|
|
Franchise
|
707
|
558
|
149
|
26.7%
|
|
|
Entertainment
|
2,800
|
2,478
|
322
|
13.0%
|
|
|
Other
|
607
|
645
|
(38)
|
-5.9%
|
|
|
|
|
|
|
|
|
|
Total
revenues
|
34,272
|
34,302
|
(30)
|
-0.1%
|
|
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Hotels
|
27,169
|
26,592
|
577
|
2.2%
|
|
|
Franchise
|
894
|
578
|
316
|
54.7%
|
|
|
Entertainment
|
2,614
|
2,013
|
601
|
29.9%
|
|
|
Other
|
393
|
422
|
(29)
|
-6.9%
|
|
|
Depreciation
and amortization
|
5,306
|
5,210
|
96
|
1.8%
|
|
|
Hotel
facility and land lease
|
2,111
|
1,747
|
364
|
20.8%
|
|
|
Loss
(gain) on asset dispositions, net
|
(86)
|
(98)
|
12
|
12.2%
|
|
|
Undistributed
corporate expenses (1)
|
1,344
|
2,443
|
(1,099)
|
-45.0%
|
|
|
|
|
|
|
|
|
|
Total
expenses
|
39,745
|
38,907
|
838
|
2.2%
|
|
|
|
|
|
|
|
|
|
Operating
income (loss)
|
(5,473)
|
(4,605)
|
868
|
18.8%
|
|
|
|
|
|
|
|
|
|
Other
income (expense):
|
|
|
|
|
|
|
Interest
expense
|
(2,301)
|
(2,236)
|
65
|
2.9%
|
|
|
Other
income, net
|
4
|
37
|
(33)
|
-89.2%
|
|
|
|
|
|
|
|
|
|
Income
(loss) before income taxes
|
(7,770)
|
(6,804)
|
966
|
14.2%
|
|
|
|
|
|
|
|
|
|
Income
tax (benefit) expense
|
(2,999)
|
(2,579)
|
420
|
16.3%
|
|
|
|
|
|
|
|
|
|
Net
income (loss) from continuing operations
|
(4,771)
|
(4,225)
|
546
|
12.9%
|
|
|
|
|
|
|
|
|
|
Discontinued
operations:
|
|
|
|
|
|
|
Income
(loss) from operations of discontinued business units,
|
|
|
|
|
|
|
net
of income tax (benefit) expense of ($79)
|
-
|
(154)
|
154
|
100.0%
|
|
|
|
|
|
|
|
|
|
Net
income (loss) from discontinued operations
|
-
|
(154)
|
154
|
100.0%
|
|
|
|
|
|
|
|
|
|
Net
income (loss)
|
(4,771)
|
(4,379)
|
392
|
9.0%
|
|
|
|
|
|
|
|
|
|
Less:
Net income (loss) attributable to noncontrolling interest
|
10
|
11
|
(1)
|
9.1%
|
|
|
|
|
|
|
|
|
|
Net
income (loss) attributable to Red Lion Hotels Corporation (1)
|
$
(4,761)
|
$
(4,368)
|
$ 393
|
9.0%
|
|
|
|
|
|
|
|
|
|
Earnings
per share - basic and diluted
|
|
|
|
|
|
|
Net
income (loss) from continuing operations
|
$
(0.25)
|
$
(0.23)
|
|
|
|
|
Net
Income (loss) from discontinued operations
|
$ -
|
$
(0.01)
|
|
|
|
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
$
(0.25)
|
$
(0.24)
|
|
|
|
|
Weighted
average shares - basic and diluted (2)
|
18,974
|
18,269
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
(1,3)
|
$ (153)
|
$ 436
|
$ (589)
|
-135.1%
|
|
|
EBITDA
as a percentage of revenues
|
-0.4%
|
1.3%
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
from continuing operations (1,3)
|
$ (153)
|
$ 653
|
$ (806)
|
-123.4%
|
|
|
EBITDA
from continuing operations
|
-0.4%
|
1.9%
|
|
|
|
|
as a
percentage of revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Includes $1.2 million of cash and non-cash expense recorded in the
first quarter of 2010 related to the separation of the company's former
President and CEO, as discussed further in this release under
Disclosure of Special Items.
|
|
|
|
|
(2)
For the three months ended March 31, 2011 and 2010, all of the 350,381
and 995,027 options to purchase common stock shares outstanding as of
those dates, respectively, were considered anti-dilutive due to the
loss for the period. Likewise, all of the 44,837 convertible operating
partnership units were considered anti-dilutive, as were the 214,496
and 154,885 units of unissued restricted stock outstanding.
|
|
|
|
|
(3)
The definition of "EBITDA" and how that measure relates to net income
attributable to Red Lion Hotels Corporation is discussed further in
this release under Non-GAAP Financial Measures.
|
|
|
|
Red
Lion Hotels Corporation
|
|
|
Consolidated
Balance Sheets
|
|
|
(unaudited)
|
|
|
($ in
thousands, except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
|
|
|
|
2011
|
|
2010
|
|
|
Assets:
|
|
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$ 5,607
|
|
$ 4,012
|
|
|
|
Restricted
cash
|
|
4,792
|
|
4,120
|
|
|
|
Accounts
receivable, net
|
|
5,992
|
|
5,985
|
|
|
|
Inventories
|
|
1,322
|
|
1,328
|
|
|
|
Prepaid
expenses and other
|
|
1,920
|
|
1,937
|
|
|
|
Deferred
income taxes
|
|
7,377
|
|
-
|
|
|
|
Assets
held for sale
|
|
43,944
|
|
-
|
|
|
|
|
|
Total
current assets
|
|
70,954
|
|
17,382
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
and equipment, net
|
|
229,458
|
|
272,030
|
|
|
Goodwill
|
|
|
22,730
|
|
28,042
|
|
|
Intangible
assets, net
|
|
7,972
|
|
7,984
|
|
|
Other
assets, net
|
|
6,732
|
|
6,044
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
337,846
|
|
$
331,482
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Accounts
payable
|
|
$ 5,504
|
|
$ 7,146
|
|
|
|
Accrued
payroll and related benefits
|
|
3,239
|
|
4,367
|
|
|
|
Accrued
interest payable
|
|
291
|
|
276
|
|
|
|
Advance
deposits
|
|
1,079
|
|
487
|
|
|
|
Other
accrued expenses
|
|
11,991
|
|
10,178
|
|
|
|
Revolving
credit facility
|
|
25,000
|
|
18,000
|
|
|
|
Long-term
debt, due within one year
|
|
24,928
|
|
25,275
|
|
|
|
|
|
Total
current liabilities
|
|
72,032
|
|
65,729
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt, due after one year
|
|
51,391
|
|
51,877
|
|
|
Deferred
income
|
|
5,015
|
|
4,859
|
|
|
Deferred
income taxes
|
|
11,789
|
|
7,427
|
|
|
Debentures
due Red Lion Hotels Capital Trust
|
|
30,825
|
|
30,825
|
|
|
|
|
|
Total
liabilities
|
|
171,052
|
|
160,717
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
Red
Lion Hotels Corporation stockholders' equity
|
|
|
|
|
|
|
|
Preferred
stock - 5,000,000 shares authorized; $0.01 par value;
|
|
|
|
|
|
|
|
no
shares issued or outstanding
|
|
-
|
|
-
|
|
|
|
Common
stock - 50,000,000 shares authorized; $0.01 par value;
|
|
|
|
|
|
|
|
18,993,267
and 18,869,254 shares issued and outstanding
|
|
190
|
|
189
|
|
|
|
Additional
paid-in capital, common stock
|
|
147,633
|
|
146,834
|
|
|
|
Retained
earnings
|
|
18,975
|
|
23,737
|
|
|
|
|
|
Total
Red Lion Hotels Corporation stockholders' equity
|
|
166,798
|
|
170,760
|
|
|
|
|
|
|
|
|
|
|
|
|
Noncontrolling
interest
|
|
(4)
|
|
5
|
|
|
|
|
|
Total
equity
|
|
166,794
|
|
170,765
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and stockholders' equity
|
|
$
337,846
|
|
$
331,482
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Red
Lion Hotels Corporation
|
|
|
Consolidated
Statement of Cash Flows
|
|
|
(unaudited)
|
|
|
($ in
thousands)
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
2011
|
|
2010
|
|
|
Operating
activities:
|
|
|
|
|
|
Net
income (loss)
|
$
(4,771)
|
|
$
(4,379)
|
|
|
Adjustments
to reconcile net income (loss) attributable to Red Lion Hotels
Corporation
|
|
|
|
|
|
to
net cash provided by (used in) operating activities:
|
|
|
|
|
|
Depreciation and amortization
|
5,306
|
|
5,226
|
|
|
Gain
on disposition of property, equipment and other assets, net
|
(86)
|
|
(98)
|
|
|
Deferred income tax provision (benefit)
|
(3,015)
|
|
(2,682)
|
|
|
Equity in investments
|
10
|
|
11
|
|
|
Stock
based compensation expense
|
225
|
|
672
|
|
|
Provision for doubtful accounts
|
(16)
|
|
37
|
|
|
Change in current assets and liabilities:
|
|
|
|
|
|
Restricted cash
|
(672)
|
|
(1,224)
|
|
|
Accounts receivable
|
9
|
|
(1,218)
|
|
|
Inventories
|
6
|
|
9
|
|
|
Prepaid expenses and other
|
17
|
|
10
|
|
|
Accounts payable
|
(1,642)
|
|
(1,358)
|
|
|
Accrued payroll and related benefits
|
(1,128)
|
|
1,423
|
|
|
Accrued interest payable
|
15
|
|
17
|
|
|
Deferred income
|
275
|
|
-
|
|
|
Other
accrued expenses and advance deposits
|
2,405
|
|
4,984
|
|
|
Net
cash (used in) provided by operating activities
|
(3,062)
|
|
1,430
|
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
Purchases
of property and equipment
|
(386)
|
|
(1,518)
|
|
|
Proceeds
from disposition of property and equipment
|
1
|
|
-
|
|
|
Advances
to Red Lion Hotels Capital Trust
|
(27)
|
|
(27)
|
|
|
Other,
net
|
(507)
|
|
271
|
|
|
|
|
|
|
|
|
Net
cash (used in) provided by investing activities
|
(919)
|
|
(1,274)
|
|
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
Borrowings
on revolving credit facility
|
7,000
|
|
3,000
|
|
|
Repayment
of revolving credit facility
|
-
|
|
(2,000)
|
|
|
Repayment
of long-term debt
|
(833)
|
|
(793)
|
|
|
Proceeds
from stock options exercised
|
512
|
|
152
|
|
|
Proceeds
from issuance of common stock under employee stock
|
|
|
|
|
|
purchase
plan
|
63
|
|
71
|
|
|
Additions
to deferred financing costs
|
(1,166)
|
|
(171)
|
|
|
|
|
|
|
|
|
Net
cash (used in) provided by financing activities
|
5,576
|
|
259
|
|
|
|
|
|
|
|
|
Net
change in cash from operating activities of discontinued operations
|
-
|
|
3
|
|
|
|
|
|
|
|
|
Change
in cash and cash equivalents:
|
|
|
|
|
|
Net
increase (decrease) in cash and cash equivalents
|
1,595
|
|
418
|
|
|
Cash
and cash equivalents at beginning of period
|
4,012
|
|
3,881
|
|
|
|
|
|
|
|
|
Cash
and cash equivalents at end of period
|
$ 5,607
|
|
$ 4,299
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Red
Lion Hotels Corporation
|
|
|
Additional
Hotel Statistics
|
|
|
(unaudited)
|
|
|
|
|
System-wide
Hotels as of March 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
Meeting
Space
|
|
|
|
|
|
|
|
Hotels
|
Rooms
|
(sq.
ft.)
|
|
|
|
|
|
|
Red
Lion Owned and Leased Hotels
|
31
|
6,121
|
304,566
|
|
|
|
|
|
|
Red
Lion Franchised Hotels
|
14
|
2,509
|
125,231
|
|
|
|
|
|
|
Total
Red Lion Hotels
|
45
|
8,630
|
429,797
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
Hotel Statistics (1)
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31, 2011
|
|
Three
months ended March 31, 2010
|
|
|
|
Average
|
|
|
|
Average
|
|
|
|
|
|
Occupancy
(2)
|
ADR (3)
|
RevPAR
(4)
|
|
Occupancy
(2)
|
ADR (3)
|
RevPAR
(4)
|
|
|
Owned
and Leased Hotels
|
48.2%
|
$ 80.34
|
$ 38.69
|
|
48.2%
|
$ 80.10
|
$ 38.63
|
|
|
Franchised
Hotels
|
53.6%
|
$ 74.69
|
$ 40.05
|
|
48.5%
|
$ 75.60
|
$ 36.65
|
|
|
Total
System Wide
|
49.4%
|
$ 78.94
|
$ 39.00
|
|
48.3%
|
$ 79.07
|
$ 38.18
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
from prior comparative period:
|
|
|
|
|
|
|
|
|
|
Owned
and Leased Hotels
|
-
|
0.3%
|
0.2%
|
|
|
|
|
|
|
Franchised Hotels
|
5.1
|
-1.2%
|
9.3%
|
|
|
|
|
|
|
Total
System Wide
|
1.1
|
-0.2%
|
2.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Includes all hotels owned, leased and franchised, presented on a
comparable basis for hotel statistics.
|
|
|
|
|
(2)
Average occupancy represents total paid rooms divided by total
available rooms. Total available rooms represents the number of rooms
available multiplied by the number of days in the reported period and
includes rooms taken out of service for renovation.
|
|
|
|
|
(3)
Average daily rate ("ADR") represents total room revenues divided by
the total number of paid rooms occupied by hotel guests.
|
|
|
|
|
(4)
Revenue per available room ("RevPAR") represents total room and related
revenues divided by total available rooms.
|
|
|
|
Red
Lion Hotels Corporation
|
|
|
Disclosure
of Special Items
|
|
|
(unaudited)
|
|
|
|
|
|
|
In the
first quarter of 2010, the Company recorded an expense of $1.2 million
resulting from the separation of the Company's former President and
Chief Executive Officer. As a result, the operations as presented in
the accompanying financial statements for the three months ended March
31, 2011 compared to 2010 do not reflect a meaningful comparison
between periods. The following table represents a reconciliation of
certain earnings measures before special items to net income / (loss)
from continuing operations.
|
|
|
|
|
|
|
|
Three
months ended March 31, 2011
|
|
Three
months ended March 31, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
($ in
thousands except per share data)
|
Net
income / (loss)
from continuing
operations
|
EBITDA
|
Diluted
EPS
|
|
Net
income / (loss)
from continuing
operations
|
EBITDA
|
Diluted
EPS
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount
before special items
|
$
(4,771)
|
$ (153)
|
$
(0.25)
|
|
$
(3,439)
|
$ 1,872
|
$
(0.18)
|
|
|
|
|
|
|
|
|
|
|
|
|
Special
items:
|
|
|
|
|
|
|
|
|
|
Separation
costs (1)
|
-
|
-
|
-
|
|
(1,219)
|
(1,219)
|
(0.07)
|
|
|
Income
tax benefit of special items, net (2)
|
-
|
-
|
-
|
|
433
|
-
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount
per consolidated statement of operations
|
$
(4,771)
|
$ (153)
|
$
(0.25)
|
|
$
(4,225)
|
$ 653
|
$
(0.23)
|
|
|
|
|
|
|
|
|
|
|
|
|
Change
from the comparative period:
|
|
|
|
|
|
|
|
|
|
Amount
before special items
|
-38.7%
|
-108.2%
|
-38.9%
|
|
|
|
|
|
|
Amount
per consolidated statement of operations
|
-12.9%
|
-123.4%
|
-8.7%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Amount as included in the line item "Undistributed corporate expenses"
on the accompanying consolidated statements of operations.
|
|
|
|
|
(2)
Represents taxes on special items at the Company's expected incremental
tax rate as applicable.
|
|
|
|
Red
Lion Hotels Corporation
|
|
|
Reconciliation
of EBITDA to Net Income Attributable to Red Lion Hotels Corporation
|
|
|
(unaudited)
|
|
|
($ in
thousands)
|
|
|
|
|
|
The
following is a reconciliation of EBITDA and EBITDA from continuing
operations to net income (loss) attributable to Red Lion Hotels
Corporation for the periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
$ (153)
|
|
$ 436
|
|
|
Income
tax benefit (expense)
|
|
2,999
|
|
2,658
|
|
|
Interest
expense
|
|
(2,301)
|
|
(2,236)
|
|
|
Depreciation
and amortization
|
|
(5,306)
|
|
(5,226)
|
|
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
|
$
(4,761)
|
|
$
(4,368)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
2011
|
|
2010
|
|
|
|
|
|
|
|
|
|
EBITDA
from continuing operations
|
|
$ (153)
|
|
$ 653
|
|
|
Income
tax benefit (expense)
|
|
2,999
|
|
2,579
|
|
|
Interest
expense
|
|
(2,301)
|
|
(2,236)
|
|
|
Depreciation
and amortization
|
|
(5,306)
|
|
(5,210)
|
|
|
Discontinued
operations, net of tax
|
|
-
|
|
(154)
|
|
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
|
$
(4,761)
|
|
$
(4,368)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-GAAP
FINANCIAL MEASURES
EBITDA
is defined as net income attributable to Red Lion Hotels Corporation,
before interest, taxes, depreciation and amortization. EBITDA is
considered a non-GAAP financial measurement. We believe it is a useful
financial performance measure for us and for our shareholders and is a
complement to net income attributable to Red Lion Hotels Corporation
and other financial performance measures provided in accordance with
generally accepted accounting principles in the United States ("GAAP").
|
|
|
|
|
We use
EBITDA to measure the financial performance of our owned and leased
hotels because it excludes interest, taxes, depreciation and
amortization, which bear little or no relationship to operating
performance. By excluding interest expense, EBITDA measures our
financial performance irrespective of our capital structure or how we
finance our properties and operations. We generally pay federal and
state income taxes on a consolidated basis, taking into account how the
applicable taxing laws apply to our company in the aggregate. By
excluding taxes on income, we believe EBITDA provides a basis for
measuring the financial performance of our operations excluding factors
that our hotels and other operations cannot control. By excluding
depreciation and amortization expense, which can vary from hotel to
hotel based on historical cost and other factors unrelated to the
hotels’ financial performance, EBITDA measures the financial
performance of our hotels without regard to their historical cost. For
all of these reasons, we believe that EBITDA provides us and investors
with information that is relevant and useful in evaluating our
business.
|
|
|
|
|
However,
because EBITDA excludes depreciation and amortization, it does not
measure the capital we require to maintain or preserve our long-lived
assets. In addition, because EBITDA does not reflect interest expense,
it does not take into account the total amount of interest we pay on
outstanding debt nor does it show trends in interest costs due to
changes in our borrowings or changes in interest rates. EBITDA, as
defined by us, may not be comparable to EBITDA as reported by other
companies that do not define EBITDA exactly as we define the term.
Because we use EBITDA to evaluate our financial performance, we
reconcile all EBITDA measures to net income attributable to Red Lion
Hotels Corporation, which is the most comparable financial measure
calculated and presented in accordance with GAAP. EBITDA does not
represent cash provided by operating activities determined in
accordance with GAAP, and should not be considered as an alternative to
operating income or net income attributable to Red Lion Hotels
Corporation determined in accordance with GAAP as an indicator of
performance or as an alternative to cash flows from operating
activities as an indicator of liquidity.
|
|
