CLEVELAND, Feb. 9, 1999 - Boykin Lodging Company (NYSE:
BOY), a multitenant hotel real estate investment trust, today reported
record revenues and funds from operations for the fourth quarter and year
ending December 31, 1998.
Fourth-quarter highlights:
-
Revenues more than doubled
-
Funds from operations (FFO) increased 76.9 percent
-
FFO per share rose 6.1 percent, matching consensus analyst estimates of
53 cents per share/unit
-
Room revenues per available room (REVPAR) rose 1.9 percent
-
Occupancy and average daily rate were both up.
For 1998's fourth quarter, FFO increased 76.9 percent to $9.8 million from
$5.5 million for the same period in 1997. Percentage lease revenues more
than doubled to $18.4 million from $9.0 million for the fourth quarter
of 1997. On a per-share basis, diluted fourth-quarter FFO increased six
percent to $0.53 from $0.50 the year before.
On a same-unit basis, total hotel revenues for the 1998 fourth quarter
were $66.5 million, compared with $65.7 million the year before. REVPAR
increased 1.9 percent to $53.59 from $52.58 last year. Occupancy was 61.8
percent compared with 61.5 percent last year. The average daily rate increased
1.5 percent to $86.78 from $85.53.
Fourth-quarter net income increased to $3.4 million, or $0.20 per share,
for 1998 from $1.4 million, or $0.14 per share, for 1997.
"We started the year with 17 hotels comprising 4,568 rooms and ended
with 31 hotels and 8,689 rooms," said Robert W. Boykin, chairman, president
and chief executive officer. "We expanded our geographic reach into twelve
new markets in six new states. In the process, we formed strategic alliances
with some well-respected hospitality companies."
Strategic renovation and repositioning continues to drive Boykin's internal
growth by developing the earnings power of individual hotels and unlocking
their potential to achieve increases in REVPAR.
"In 1998, we invested $32.5 million in hotel capital renovation, representing
nearly 14 percent of the 1998 hotel revenues under our ownership," Mr.
Boykin said. "As we have seen time and time again, these dollars yield
measurable returns and strengthen our income stream -- very important to
a dividend-paying enterprise. In fact, the benefits of our renovation program
started to manifest themselves in 1998's fourth quarter, when we completed
the renovation of two of our largest hotels."
Last week the company announced a joint venture with AEW Partners III,
L.P., an investment partnership managed by AEW Capital Management, L.P.,
a Boston-based real estate investment firm with a portfolio of approximately
$6 billion.
"The combination of AEW's capital with our expertise in this joint venture
should enable us to take advantage of selected hotel acquisition opportunities
and enhance our cash flow and share value," Mr. Boykin said.
For all of 1998, FFO increased 56.3 percent to $42.8 million, or $2.59
per share/unit (basic and diluted), compared with $27.4 million, or $2.50
per share/unit (diluted), for 1997. Percentage lease revenues for the full
year increased 84.1 percent to $69.7 million for 1998 from $37.9 million
for 1997.
On a same-unit basis, REVPAR for 1998 increased to $60.04 from $59.80
for 1997. Occupancy for the year was 66.6 percent, compared with 68.3 percent
for 1997. Average daily rate increased to $90.18 from $87.52.
Net income for 1998 increased 32.5 percent to $19.0 million, or $1.25
per share, from $14.3 million, or $1.49 per share, for 1997. An extraordinary
item of $1.1 million, or $0.07 per share, in 1998 resulted from the write-off
of deferred financing costs associated with the replacement of the company's
revolving credit facility in the second quarter. Net income for 1997 included
an extraordinary item of $882,000, or $0.09 per share, for a loss related
to the early extinguishment of debt. Income before extraordinary items
increased 32.3 percent to $20.1 million from $15.2 million.
Boykin Lodging Company is a multitenant real estate investment trust
which focuses on the acquisition
of full-service, upscale commercial and resort hotels. The company currently
owns 31 full-service commercial and resort hotels containing a total of
8,689 rooms located in California, Colorado, Florida, Idaho, Indiana, Maryland,
Minnesota, Missouri, Nebraska, New York, New Jersey, North Carolina, Ohio,
Oregon, Tennessee, and Washington.
BOYKIN LODGING COMPANY
Same Unit Statistics
(Hotel revenues in thousands)
|
For the year ended
December 31, |
|
|
1998
|
1997
|
All Hotels (29 properties) (a)
|
|
|
Hotel revenues |
$276,878 |
$276,132 |
REVPAR |
$60.04 |
$59.80 |
Occupancy |
66.6% |
68.3% |
Average Daily Rate |
$90.18 |
$87.52 |
(a) Represents the operating results of hotels owned by Boykin
at December 31, 1998, including predecessors' results. These statistics
exclude the results of the DoubleTree Hotel Kansas City and the Daytona
Beach Radisson Resort as these hotels were closed for renovation during
portions of 1997.
This release contains forward-looking statements. Although the company
believes its business plans are based upon reasonable assumptions, it can
give no assurance that its expectations will be attained. Factors that
could cause actual results to differ materially from the company's expectations
include financial performance, real estate conditions, execution of hotel
acquisition programs, changes in local or national economic conditions,
and other similar variables. |