Close

Cart

Total $0.00

Checkout

CHARLOTTE, N.C.--()--Extended Stay America, Inc. (NYSE:STAY) (the “Company”) today announced consolidated results for the quarter ended March 31, 2017.

First Quarter 2017 Highlights

  • Revenue Per Available Room (“RevPAR”) grew 2.1% to $45.76
  • Net Income increased 8.9% to $16.1 million
  • Adjusted EBITDA increased 5.5% to $129.6 million
  • Adjusted Funds from Operations (“Adjusted FFO”)1 per diluted Paired Share increased 11.7% to $0.35
  • Adjusted Paired Share Income1 per diluted Paired Share increased 15.7% to $0.15

The Company’s Chief Executive Officer, Gerry Lopez, commented, “We were pleased with our strong topline finish and our solid expense discipline throughout the first quarter. This led to results finishing above our guidance for both RevPAR as well as Adjusted EBITDA. Additionally, both Adjusted Paired Share Income and Adjusted FFO per diluted Paired Share grew more than 10% in the first quarter.”

Mr. Lopez continued, “With our strong free cash flow and outlook for 2017 and beyond, we continue to focus on returning capital to shareholders. This morning, our Boards approved raising our quarterly dividend by 10.5% to $0.21 per Paired Share, marking the third year in a row since becoming a public company that we have increased our dividend by over 10%. This represents a roughly 5% annual yield at recent trading prices. In addition to our strong dividend, in the last 14 months the Company has repurchased and retired over 5% of our Paired Shares outstanding. We remain firmly committed to strong capital returns to shareholders as our free cash flow continues to increase and as we recycle capital.”

Financial and Operating Results

Total revenues for the three months ended March 31, 2017 increased 1.2% over the comparable period in 2016 to $291.0 million. Total revenue growth was affected by one fewer day in the quarter compared to the comparable period in 2016 due to leap year.

RevPAR for the three months ended March 31, 2017 grew 2.1% over the comparable period in 2016, driven by an improvement in average daily rate (“ADR”) of 0.8% while occupancy increased to 70.4% compared to 69.5% in the comparable period in 2016.

Hotel Operating Margin1 for the three months ended March 31, 2017 was 52.5% compared to 50.4% in the comparable period in 2016. Hotel operating margin flow-through, defined as the change in Hotel Operating Profit1 divided by the change in total hotel revenues, was 230.3%.

Net income for the three months ended March 31, 2017 was $16.1 million compared to $14.8 million in the comparable period in 2016. Net income during the quarter was impacted by a non-cash impairment charge of $12.4 million related to assets held for sale. Income tax expense for the three months ended March 31, 2017 was $4.5 million compared to $2.9 million in the comparable period in 2016.

Adjusted EBITDA for the three months ended March 31, 2017 increased $6.8 million to $129.6 million over the comparable period in 2016. Adjusted EBITDA, a non-GAAP measure, excludes non-cash equity-based compensation of $2.7 million, non-cash impairment loss of $12.4 million related to assets held for sale, and other net expenses of $2.7 million.

Adjusted FFO for the three months ended March 31, 2017 was $68.7 million, an increase of 6.8% from the comparable period in 2016. Adjusted FFO per diluted Paired Share was $0.35 compared to $0.31 in the comparable period in 2016. Adjusted FFO, a non-GAAP measure, represents Funds From Operations1, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share. A Paired Share entitles its holder to participate in 100% of the common equity and earnings of both Extended Stay America, Inc. and ESH Hospitality, Inc.

Adjusted Paired Share Income for the three months ended March 31, 2017 was $28.5 million, or $0.15 per diluted Paired Share, compared to $25.8 million, or $0.13 per diluted Paired Share, in the comparable period in 2016. Adjusted Paired Share Income, a non-GAAP measure, represents net income, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share.

Capital Expenditures

The Company invested $48.4 million in capital expenditures during the first quarter of 2017 which includes $21.0 million in renovation capital and $25.1 million in maintenance capital. The Company completed 24 hotel renovations in the first quarter of 2017, bringing the total number of renovated hotels to 608. We expect to complete the renovation program in the second quarter of 2017.

Distribution and Share Repurchases

On April 27, 2017, the Boards of Directors of Extended Stay America, Inc. and ESH Hospitality, Inc., declared cash distributions totaling $0.21 per Paired Share for the first quarter of 2017. This represents a $0.02, or 10.5%, increase in the combined quarterly distribution. The distribution is comprised of $0.07 per Extended Stay America, Inc. common share and $0.14 per ESH Hospitality, Inc. Class A and B common share. The distributions are payable on May 25, 2017 to shareholders of record as of May 11, 2017.

During the quarter, the Company paid approximately $23.1 million to repurchase and retire approximately 1.4 million Paired Shares. The Company had approximately $137.1 million remaining for repurchases under the combined Paired Share repurchase program as of March 31, 2017. 

To view full financial release and corresponding tables please click the PDF icon or visit:
http://www.aboutstay.com/CorporateProfile.aspx?iid=4409177

About Extended Stay America

Extended Stay America, Inc. (“ESA”) is the largest integrated hotel owner/operator in North America. Its subsidiary, ESH Hospitality, Inc. (“ESH”), is the largest lodging REIT in North America by unit and room count, with over 620 hotels and 69,000 rooms in the U.S. and Canada. ESA manages all of ESH’s properties, providing over 8,000 jobs at hotel properties and corporate headquarters. Extended Stay America® is the leading brand in the mid-priced extended stay segment, with approximately twice as many rooms as its nearest competitor. Visit www.esa.com for more information. 

Contact: Investors: Rob Ballew

investorrelations@esa.com / 980-345-1546

Contact: Media: Terry Atkins

tatkins@esa.com / 980-345-1648

Related News

Q2 2017 Financial Reports Round Up - Part 3: Choice, Chesapeake, Chatham, Sunstone & ESA

FelCor Reports Q1 2017 Net Loss of $42.2 Million Compared to $11.2 Million for the Same Period in 2016; RevPAR Down 1.3% for Quarter

Chatham Lodging Trust Reports Net Income Increase of $1.3 Million to $4.6 Million Driven by 1.2% Increase in RevPAR and Higher Margins

RLJ Lodging Trust Sees Net Income Decrease to $21.8 Million in Q1 2017; RevPAR and Occupancy Decreased Slightly for Quarter

Marriott International Reports Q1 2017 Net Income of $365 Million, a 67% Increase Over 2016; RevPAR Rose 3.1% for the Quarter

DiamondRock Hospitality Reports Q1 2017 Net Income of $8.9 Million, Comparable RevPAR was $161.89, a 1.9% Increase

Ashford Trust Reports Q1 2017 Net Loss of $33.2 Million; Comparable RevPAR Increased 3.4% During the Quarter

IHG Reports Q1 2017 Global Comparable RevPAR Increased 2.7%; Enhanced Global Scale 3.4% by Opening 7K Rooms

Summit Hotel Properties Reports Q1 2017 Net Income of $28.9 Million Compared to $44.3 Million in Q1 2016

Ashford Prime Reports Reports First Quarter 2017 Net Loss of $1.7 Million; Comparable RevPAR for all Hotels Increased 2.5%

Hyatt Hotels Reports Q1 2017 Net Income Increased 104.8% to $70 Million; Comparable Systemwide RevPAR Increased 4.7%

Choice Hotels Reports Q1 2017 Net Income of $28.7 Million Compared to $21.2 Million Q1 2016

Park Hotels & Resorts Reports Q1 2017 Net Income of $2.4 Million; Comparable RevPAR Increased 1.4%

Sunstone Hotel Investors Reports a Q1 2017 Net Income Increase of 5,148.9% to $63.8 Million Due to Gain on Sale of Fairmont Newport Beach

Caesars Entertainment Reports Q1 2017 Net Revenues Increased 1.4% YOY to $963 Million and a Net Loss of $524 Million Compared to $274 Million Q1 2016

Ryman Hospitality Properties Reports Q1 2017 Net Income Increased 23.8% to $32.6 Million Compared to Q1 2016

Hilton Worldwide Completes its First Quarter as a Fee Driven Company Reporting Q1 2017 Net Income of $75 Million; System-Wide Comparable RevPAR Grew 3.0 Percent

Host Hotels & Resorts Reports Q1 2017 Net Income of $161 Million, a Decrease of $23 Million Compared to Q1 2016

MGM Resorts International Reports Q1 2017 Net Revenues Increase of 29% to $2.1 Billion at the Company's Domestic Resorts; Las Vegas Strip Resorts Grew RevPAR by 8.6%

Las Vegas Sands Reports Q1 2017 Consolidated Net Revenue Increase of 14.3% to $3.11 Billion; Net Income Increased 41.3% to $578 Million

All News »

Please login or register to post a comment.