Red Lion Reports Continued Improvement for Q3 2013 in ADR & RevPAR
November 5, 2013 11:20am
For complete results and tables please visit: http://files.shareholder.com/downloads/CVH/2773029917x0x703044/4277f62b-80b9-49ff-9430-3baaef3c054b/RLH_News_2013_11_4_General.pdf
Comparable operating results and data from continuing operations (as disclosed in the table by the same title) for the periods included in this release exclude from hotel operations the results of the hotels or operations that have been sold in the past four quarters. Throughout this release the company refers to certain non-GAAP financial measures. Please refer to the tables attached to this release for a reconciliation of these non-GAAP financial measures to their most directly comparable financial measure determined in accordance with GAAP.
"With the recent conversion of three hotels to Red Lion brands, we have added a record 11 franchises this year, achieving our goal of 30 franchised properties in the Red Lion network by the end of 2013," said Interim President and Chief Executive Officer James P. Evans. "We also increased our ADR by 4.2 percent, improved hotel direct operating margin by 220 basis points and grew comparable EBITDA from continuing operations before special items by 8.3 percent year-over-year. We are pleased with our strong operational performance."
Evans continued, "The search for our next president and chief executive officer is well underway. The national executive search firm Spencer Stuart has identified numerous qualified candidates who have expressed interest in the position, underscoring the strength of the Red Lion brand and the company's future."
Third Quarter 2013 Results
Total comparable revenue from owned and leased hotels of $38.6 million increased $0.8 million or 2.1 percent compared to the same period a year ago, driven primarily by an increase in comparable rooms revenue. Year over year, comparable third quarter ADR increased by 4.2 percent to $93.85, which resulted in a RevPAR increase of 2.8 percent to $70.86. The ADR increase generated a 220 basis point improvement in comparable hotel direct operating margin from 26.7 percent to 28.9 percent.
Franchise revenue increased to $2.4 million from $1.6 million, led by the increase in the number of franchised hotels in the system and contractual increases in room rate on existing franchised hotels. Net segment profits increased $0.2 million over prior year to $0.5 million.
Entertainment revenue of $1.6 million rose $0.2 million from the 2012 third quarter, primarily due to increased ticketing demand.
On a comparable basis, total company EBITDA from continuing operations before special items was $8.3 million for the 2013 third quarter, compared to $7.7 million in the prior year period.
Income from continuing operations in the 2013 third quarter improved to $1.5 million compared to $0.6 million in the third quarter of 2012.
The operations of the company's previously owned commercial mall in Kalispell, Montana, the Red Lion Hotel Medford in Oregon, the ownership of certain real estate in Sacramento, California, and a contract catering business in Yakima, Washington, were classified as discontinued operations in prior periods. As required under generally accepted accounting principles ("GAAP"), Red Lion separately reports the results of these operations including any related asset impairment charges, net of income taxes as "Income (loss) from discontinued operations" on the company's consolidated statement of comprehensive income (loss) for all periods presented.
Liquidity and Balance Sheet
At Sept. 30, 2013, the company had $27.3 million in cash and cash equivalents and no cash borrowings on its $10 million revolving line of credit. Additionally, at Sept. 30, 2013, the company had outstanding debt of $75.4 million, of which $3.0 million was current.
Capital expenditures, primarily for guest room improvement projects, for the three and nine months ended Sept. 30, 2013, totaled $3.8 million and $8.5 million, respectively.
During the third quarter, the company signed three franchise agreements:
Assets Held for Sale
During the third quarter, the company sold the Red Lion Hotel Medford in Oregon for $2.8 million.
Outlook for 2013
Based on the outlook for the markets in which the company operates and on currently available information, the company reaffirms its previously announced RevPAR guidance and capital expenditure estimates for 2013:
Conference Call Information
The company will conduct a conference call on Nov. 4, 2013, at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time), to discuss the results for interested investors, analysts and portfolio managers. Hosting the call will be Interim President and Chief Executive Officer James P. Evans and Executive Vice President and Chief Financial Officer Julie Shiflett.
To participate in the conference call, please dial the following number ten minutes prior to the scheduled time: (800) 230-1092. International callers should dial (612) 332-0107.
This conference call will also be webcast live on 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 15 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 5:00 p.m. Pacific Time on Nov. 4, 2013, through Dec. 2, 2013, at (800) 475-6701 or (320) 365-3844 (International), using access code - 305416. The replay will also be available shortly after the call on the Red Lion website.
Tags: red lion,
q3 2013 results
Contact: Pam Scott,
Director of Corporate Communications
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