ANNAPOLIS, Md.-Feb. 18, 2016– Chesapeake Lodging Trust (NYSE:CHSP), a lodging real estate investment trust (REIT), reported today its financial results for the quarter ended December 31, 2015.
HIGHLIGHTS
- RevPAR: 3.8% pro forma increase for the hotel portfolio over the same period in 2014.
- Adjusted Hotel EBITDA Margin: 240 basis point pro forma increase to 32.7% for the hotel portfolio over the same period in 2014.
- Adjusted Hotel EBITDA: $47.8 million.
- Adjusted Corporate EBITDA: $42.8 million.
- Adjusted FFO: $30.7 million or $0.52 per diluted common share.
CONSOLIDATED FINANCIAL RESULTS
The following is a summary of the consolidated financial results for the three months and year ended December 31, 2015 and 2014 (in millions, except share and per share amounts):
Three Months Ended December 31, Year Ended December 31, 2015 2014 2015 2014 Total revenue $ 146.2 $ 123.5 $ 582.6 $ 478.0 Net income available to common shareholders $ 12.3 $ 6.4 $ 57.8 $ 51.3 Net income per diluted common share $ 0.21 $ 0.12 $ 0.99 $ 1.00 Adjusted Hotel EBITDA $ 47.8 $ 37.7 $ 190.6 $ 154.0 Adjusted Corporate EBITDA $ 42.8 $ 33.7 $ 172.5 $ 138.4 AFFO available to common shareholders $ 30.7 $ 24.0 $ 127.8 $ 100.4 AFFO per diluted common share $ 0.52 $ 0.44 $ 2.21 $ 1.97 Weighted-average number of diluted common shares outstanding 59,027,852 54,262,749 57,926,399 50,890,861
HOTEL OPERATING RESULTS
Management assesses the operating performance of its hotels irrespective of the hotel owner during the periods compared using the following key operating metrics: occupancy, ADR, RevPAR, Adjusted Hotel EBITDA, and Adjusted Hotel EBITDA Margin. The Trust uses the term "pro forma" to refer to metrics that include, or comparisons of metrics that are based on, the operating results of hotels under previous ownership for either a portion of or the entire period. As of December 31, 2015, the Trust owned 22 hotels. Since two of its hotels owned as of December 31, 2015 were acquired during 2015 and another one was acquired in October 2014, the key operating metrics below reflect the pro forma operating results for those hotels for all, or a certain period, of the three months and year ended December 31, 2015 and 2014.
Included in the following table are comparisons of the key operating metrics for the hotel portfolio for the three months and year ended December 31, 2015 and 2014 (in thousands, except for ADR and RevPAR):
Three Months Ended December 31, Year Ended December 31, 2015 2014(1) Change 2015(1) 2014(1) Change Pro forma Occupancy 79.0 % 75.2 % 380 bps 81.3 % 79.4 % 190 bps Pro forma ADR $ 222.41 $ 225.11 (1.2)% $ 228.70 $ 221.44 3.3% Pro forma RevPAR $ 175.68 $ 169.29 3.8% $ 185.88 $ 175.87 5.7% Pro forma Adjusted Hotel EBITDA $ 47,763 $ 42,668 11.9% $ 197,393 $ 180,113 9.6% Pro forma Adjusted Hotel EBITDA Margin 32.7 % 30.3 % 240 bps 32.7 % 31.4 % 130 bps __________
(1)
Includes results of operations for certain hotels prior to their acquisition by the Trust.
Hotel EBITDA, Adjusted Hotel EBITDA, Adjusted Hotel EBITDA Margin, Corporate EBITDA, Adjusted Corporate EBITDA, FFO, FFO available to common shareholders and AFFO available to common shareholders are non-GAAP financial measures within the meaning of the rules of the Securities and Exchange Commission. See the discussion included in this press release for information regarding these non-GAAP financial measures.
CAPITAL MARKETS ACTIVITY
The Trust has not sold any common shares under its continuous at-the-market (ATM) program or repurchased any common shares under its share repurchase program during 2015 and through February 18, 2016.
DIVIDENDS
On October 15, 2015, the Trust paid dividends in the amounts of $0.40 per share to its common shareholders and $0.484375 per share to its preferred shareholders, both of record as of September 30, 2015. On December 17, 2015, the Trust declared dividends in the amounts of $0.40 per share payable to its common shareholders and $0.484375 per share payable to its preferred shareholders, both of record as of December 31, 2015. Both dividends were paid on January 15, 2016.
2016 OUTLOOK
The Trust reaffirms its previously provided first quarter and full year 2016 outlook as follows (in millions, except RevPAR and per share amounts):
First Quarter 2016 Outlook
Full Year 2016 Outlook Low High Low High CONSOLIDATED: Net income available to common shareholders $ 3.4 $ 5.1 $ 72.9 $ 78.6 Net income per diluted common share $ 0.06 $ 0.09 $ 1.24 $ 1.34 Adjusted Corporate EBITDA $ 31.2 $ 32.7 $ 193.6 $ 200.1 AFFO available to common shareholders $ 21.8 $ 23.6 $ 147.1 $ 152.8 AFFO per diluted common share $ 0.37 $ 0.40 $ 2.50 $ 2.60 Corporate cash general and administrative expense $ 2.8 $ 3.0 $ 10.0 $ 10.8 Corporate non-cash general and administrative expense $ 2.3 $ 2.3 $ 9.4 $ 9.4 Weighted-average number of diluted common shares outstanding 59.2 59.2 58.9 58.9 HOTEL PORTFOLIO: RevPAR $ 164.00 $ 167.00 $ 195.00 $ 199.00 Pro forma RevPAR increase over 2015(1) 6.0 % 8.0 % 5.0 % 7.0 % Adjusted Hotel EBITDA $ 36.3 $ 38.0 $ 213.0 $ 220.3 Adjusted Hotel EBITDA Margin 26.9 % 27.6 % 33.7 % 34.2 % Pro forma Adjusted Hotel EBITDA Margin increase over 2015(1) 200 bps 275 bps 100 bps 150 bps _____________
(1)
The comparable 2015 period includes results of operations for certain hotels prior to their acquisition by the Trust.
The Trust’s 2016 outlook assumes no acquisitions, dispositions, or financing transactions beyond the refinance of the Hyatt Regency Boston mortgage loan and the Courtyard Washington Capitol Hill/Navy Yard mortgage loan, which are prepayable without penalty on April 6, 2016 and August 1, 2016, respectively. See the accompanying financial tables for quarterly pro forma hotel operating results for the hotel portfolio for 2015.
“We are off to a strong start in 2016 with RevPAR growth of over 9.0% in January. We continue to see solid trends on the group side of our business, which in turn has helped compression with transient booking thus far,” said James L. Francis, Chesapeake Lodging Trust’s President and Chief Executive Officer. “We expect the remainder of the quarter to exhibit continued strong growth and as a result, we are reaffirming the first quarter and full year outlook we provided earlier this year.”
Tables associated with this release are accessible via the PDF or by visiting:
http://www.chesapeakelodgingtrust.com/phoenix.zhtml?c=233098&p=irol-newsArticle&ID=2140740
