Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(UNAUDITED)
Three Months Ended Six Months Ended
June 30,
June 30,
2005 2004 2005
2004
Revenues:
Rooms
$75,330 $86,247 $137,198 $171,393
Food and beverage
44,513 43,380 79,832
85,117
Other hotel operating
revenue 14,149 13,527
26,427 27,196
133,992 143,154 243,457 283,706
Lease revenue
3,908 8,649 7,979
15,228
Total revenues
137,900 151,803 251,436 298,934
Operating Costs and Expenses:
Rooms
17,893 22,112 31,154
43,608
Food and beverage
30,977 33,125 55,962
65,645
Other departmental expenses
36,635 39,127 66,516
77,497
Management fees
4,315 5,168 8,581
10,288
Other property level expenses
8,916 8,897 15,292
18,157
Lease expense
3,418 -
6,991 -
Depreciation and amortization
14,225 19,906 24,812
40,057
Corporate expenses
4,650 13,671 9,407
20,194
Total operating
costs and
expenses
121,029 142,006 218,715 275,446
Operating income
16,871 9,797 32,721
23,488
Interest expense
(10,721) (25,588) (18,203) (50,843)
Interest income
469 445
761 969
Loss on early extinguishment
of
debt
- (24,134) -
(21,946)
Other income (expenses),
net 2,961 (3,238)
4,623 (2,043)
Income (loss) before income
taxes, minority
interests
and discontinued
operations 9,580 (42,718)
19,902 (50,375)
Income tax expense
(1,547) (109) (2,567)
(355)
Minority interests
(1,901) 1,014 (4,104)
928
Income (loss) from continuing
operations 6,132 (41,813) 13,231 (49,802)
Income from discontinued
operations
- -
- 75,662
Net income (loss)
6,132 (41,813) 13,231 25,860
Preferred shareholder
dividend (2,154)
- (2,503) -
Net income (loss) available
to
common shareholders
$3,978 $(41,813) $10,728 $25,860
Basic Earnings (Loss)
Per Share:
Income (loss)
from continuing
operations
available to common
shareholders
per share $0.13
$(2.17) $0.35 $(2.59)
Income from
discontinued
operations
available to common
shareholders
per share
- -
- 3.94
Net income
(loss) available to
common
shareholders per share $0.13 $(2.17)
$0.35 $1.35
Basic weighted-average
common
shares
outstanding
30,257 19,269 30,247
19,190
Diluted Earnings (Loss)
Per Share:
Income (loss)
from continuing
operations
available to common
shareholders
per share $0.13
$(2.19) $0.35 $(2.63)
Income from
discontinued
operations
available to common
shareholders
per share
- -
- 3.92
Net income
(loss) available to
common
shareholders per share $0.13 $(2.19)
$0.35 $1.29
Diluted weighted-average
common
shares
outstanding
30,406 19,501 30,395
19,306
Our condensed consolidated statements
of operations for the three and six months ended June 30, 2004 include
the results of the 14 hotel interests owned and leased by the company as
of June 30, 2004, as well as the results of seven other hotels, which were
distributed out of the company on June 29, 2004 in connection with the
IPO and in which the company no longer has an ownership interest.
Condensed Consolidated Balance Sheets
(in thousands, except share data)
(UNAUDITED)
June 30, December 31,
2005
2004
Assets
Property and equipment
$1,260,746 $952,717
Less accumulated
depreciation
(245,274) (222,150)
Net property and equipment
1,015,472 730,567
Goodwill
66,656 66,438
Intangible assets (net
of
accumulated amortization
of $539
and $87, respectively)
3,243
1,613
Investment in hotel joint
ventures
11,481 12,060
Cash and cash equivalents
58,085 40,071
Restricted cash and cash
equivalents
26,530 26,979
Accounts receivable (net
of allowance
for doubtful accounts
of $321 and $361,
respectively)
28,585 21,056
Deferred financing costs
(net of
accumulated amortization
of $2,964
and $1,420, respectively)
12,042 11,178
Other assets
76,103 80,388
Total assets
$1,298,197 $990,350
Liabilities and Shareholders' Equity
Liabilities:
Mortgages
and other debt payable
$689,975 $489,140
Bank credit
facility
48,000 54,000
Accounts payable
and accrued expenses 76,101
58,946
Distributions
payable
8,718
8,709
Deferred fees
on management contracts
2,246
2,333
Deferred gain
on sale of hotels
104,338 119,616
Total liabilities
929,378 732,744
Minority interests in SHCI's
operating partnership
60,516 61,053
Minority interests in
consolidated
joint ventures
15,612
-
Shareholders' equity:
8.5% Series
A Cumulative Redeemable
Preferred
Shares ($0.01 par value;
4,000,000
shares issued and outstanding;
liquidation
preference $25.00 per share) 97,540
- Common shares ($0.01 par value;
150,000,000
common shares authorized;
30,077,505
and 30,035,701 common shares
issued
and outstanding, respectively)
301
300
Additional
paid-in capital
485,771 483,691
Deferred compensation
(2,423) (1,731)
Accumulated
deficit
(258,642) (271,873)
Accumulated
distributions to
shareholders
(29,360) (13,447)
Accumulated
other comprehensive loss
(496)
(387)
Total shareholders' equity
292,691 196,553
Total liabilities and
shareholders' equity
$1,298,197 $990,350
REIT Hotel Statements of Operations (a)
(in thousands, except per share data)
Three Months Ended Six Months Ended
June 30,
June 30,
2005 2004 2005
2004
REIT Hotel Revenues:
Rooms
$75,330 $44,197 $137,198 $93,323
Food and beverage
44,513 23,988 79,832 49,271
Other hotel operating
revenue 14,149 9,010
26,427 18,502
133,992 77,195 243,457 161,096
Lease revenue (b)
3,908 6,012 7,979
11,693
REIT hotel
revenues
137,900 83,207 251,436 172,789
REIT Hotel Expenses:
Rooms
17,893 9,780 31,154
19,695
Food and beverage
30,977 17,573 55,962 35,780
Other departmental expenses
36,635 23,013 66,516 46,206
Management fees
4,315 3,588 8,581
7,367
Other property level expenses
8,916 4,086 15,292
8,388
Lease expense
3,418 -
6,991 -
REIT hotel
expenses
102,154 58,040 184,496 117,436
REIT Hotel Adjusted Operating
Income
35,746 25,167 66,940 55,353
Interest expense, net
(10,252) (14,113) (17,442) (27,636)
Loss on early extinguishment
of
debt
- (11,472) -
(9,284)
Other income (expenses),
net (c) 1,711 (3,238)
2,123 (2,043)
Income before income taxes
and
minority interests
27,205 (3,656) 51,621 16,390
Income tax expense
(1,547) (109) (2,567)
(355)
Minority interests (d)
(1,901) 1,014 (4,104)
928
REIT Hotel Income (Loss)
23,757 (2,751) 44,950 16,963
REIT depreciation and amortization
(14,225) (10,332) (24,812) (20,373)
Corporate expenses
(4,650) (13,671) (9,407) (20,194)
Asset management fees related to
distributed assets (e)
1,250 -
2,500 -
Non-REIT hotel results, net
- (15,059) -
(26,198)
Income from discontinued operations
- -
- 75,662
Net Income (Loss)
$6,132 $(41,813) $13,231 $25,860
(a) REIT hotel operating data above
excludes the results of operations of the distributed assets that are required
to be included in GAAP financial statement presentations prior to the date
of the IPO because we are deemed to have continuing involvement as a result
of our agreement to asset manage those assets. As a result, we have
presented only REIT hotel operating results and a reconciliation of REIT
hotel income to net income, the most directly comparable GAAP measure.
REIT hotel operating results are presented
because we believe that it most fairly represents comparable period-to-period
performance of our hotels and facilitates comparisons with other hotel
REITs and hotel owners. Because of the elimination of the non-REIT
hotel operations, the REIT hotel operating results do not represent our
total revenues, expenses or operating profit in accordance with GAAP.
These results should be considered in combination with our GAAP financial
statements by investors when evaluating our performance.
(b) Until March 1, 2004, the Hamburg
Marriott was accounted for under the equity method. After March 1,
2004 when we acquired our joint venture partner's 65% leasehold interest
in the property, we record lease revenue for the Hamburg Marriott.
Lease revenue for the three and six months ended June 30, 2004 includes
revenues from the Hyatt Regency New Orleans until June 29, 2004 when we
converted the Hyatt Regency New Orleans lease to a management agreement.
Prior to June 29, 2004, the Paris Marriott Champs Elysees was accounted
for as a finance obligation and we consolidated its results because of
a continuing involvement in supporting the financing of the property through
a collateralized guarantee. On June 29, 2004, we recorded a sale
and leaseback related to the Paris Marriott Champs Elysees. Subsequent
to June 29, 2004, we earn only lease revenue from the Hamburg Marriott
and the Paris Marriott Champs Elysees.
(c) Other income (expenses), net includes
our equity in earnings or losses of our investments in the Prague hotel
joint venture for the three and six months ended June 30, 2005 and 2004.
Earnings or losses from our investment in the Hamburg Marriott hotel joint
venture are included in the six months ended June 30, 2004 until the acquisition
of our joint venture partner's interest in the property on March 1, 2004.
(d) Minority interests represent interests
held by others in SHC Funding and other entities controlled by SHCI, or
for periods prior to the Offering, SHCI's predecessor, Strategic Hotel
Capital, LLC (SHC LLC). There are two components to SHCI's minority
interests. First, the Company reflects minority interests related
to the InterContinental Chicago and Miami hotels on the balance sheet for
the 15% portion of the properties consolidated by SHCI, but not owned by
the Company. The $15,612,000 minority interest balance was established
based on the agreed upon fair market value of the assets at the time of
the transaction. The earnings or losses from these properties attributable
to minority interests are normally reflected as minority interests in the
statements of operations; however, based on the partnership agreements
with IHG, SHCI receives a preferred return of all the net cash flow (as
defined in the agreements) at the properties through December 31, 2005,
up to a certain threshold. SHCI does not believe that threshold will be
exceeded in 2005. Second, minority interest in SHC Funding on the consolidated
balance sheets is calculated by dividing the number of units held by the
minority interests by the sum of SHCI's units and the units held by the
minority interests, all calculated based on the units outstanding at the
end of the period. Net income is allocated to minority interests in SHC
Funding based on their weighted average ownership percentages during the
period. The ownership percentage is calculated by dividing the number of
units held by the minority interests by the sum of SHCI's units and the
units held by the minority interests, all calculated based on the weighted
average days outstanding.
Prior to the Offering, minority interests
represented the limited partners' interests in limited partnerships that
were controlled by SHCI's predecessor, SHC LLC. The carrying value
of the minority interest was increased by the minority interests' share
of partnership earnings and reduced by their semi-annual partnership cash
distributions as well as return of capital distributions. SHC LLC's
units issued upon exchange of the limited partnership units have been accounted
for at the cost of the minority interest surrendered.
(e) The Company has an asset management
agreement with SHC LLC, under which the Company manages the day-to-day
business of SHC LLC for an annual fee of $5,000,000, payable monthly in
arrears. The term of the agreement is for five years, commenced on June
29, 2004 and will renew automatically unless prior written notice is given.
In addition, SHC LLC has the right to terminate the agreement if certain
events occur. SHC LLC has entered into a purchase and sale agreement for
one property. The asset management fee will be reduced by approximately
$716,000 annually, commencing 30 days after written notice of this sale
is received by SHCI, which is expected in the third quarter of 2005.
Non-GAAP Financial Measures
In addition to REIT hotel income,
four other non-GAAP financial measures are presented for the Company that
we believe are useful to investors as key measures of our operating performance:
Funds from Operations, or FFO;
Fully Converted FFO; Earnings Before
Interest Expense, Taxes, Depreciation and Amortization, or EBITDA; and
Adjusted EBITDA. Reconciliation of these measures to net income (loss),
the most directly comparable GAAP measure, is set forth in the following
tables.
We compute FFO in accordance with
standards established by the National Association of Real Estate Investment
Trusts, or NAREIT, which adopted a definition of FFO in order to promote
an industry-wide standard measure of REIT operating performance that would
not have certain drawbacks associated with net income (loss) under GAAP.
NAREIT defines FFO as net income (or loss) (computed in accordance with
GAAP) excluding gains (or losses) from sales of property plus real estate-related
depreciation and amortization, and after adjustments for our portion of
these items related to unconsolidated partnerships and joint ventures.
We also present Fully Converted FFO, which is FFO plus convertible debt
interest expense and minority interest expense on convertible minority
interests. We believe that the presentation of FFO and Fully Converted
FFO provides useful information to investors regarding our results of operations
because they are measures of our ability to fund capital expenditures and
expand our business. In addition, FFO is widely used in the real estate
industry to measure operating performance without regard to items such
as depreciation and amortization.
EBITDA represents net income (loss)
excluding: (i) interest expense, (ii) income tax expense, including deferred
income tax benefits and expenses applicable to our foreign subsidiaries
and income taxes applicable to sale of assets; and (iii) depreciation and
amortization. EBITDA also excludes interest expense, income tax expense
and depreciation and amortization of our equity method investments. EBITDA
for 2005 and 2004 is presented on a full participation basis, which means
we have assumed conversion of all operating partnership minority interests
into the Company's common shares. We believe this treatment of minority
interest provides more useful information for management and our investors
and appropriately considers our current capital structure. We also
present Adjusted EBITDA, which eliminates the effect of realizing deferred
gains on our sale leasebacks. We believe EBITDA and Adjusted EBITDA
are useful to an investor in evaluating our operating performance because
they provide investors with an indication of our ability to incur and service
debt, to satisfy general operating expenses, to make capital expenditures
and to fund other cash needs or reinvest cash into our business. We also
believe they help investors meaningfully evaluate and compare the results
of our operations from period to period by removing the impact of our asset
base (primarily depreciation and amortization) from our operating results.
Our management also uses EBITDA and Adjusted EBITDA as measures in determining
the value of acquisitions and dispositions.
We caution investors that amounts
presented in accordance with our definitions of FFO, Fully Converted FFO,
EBITDA and Adjusted EBITDA may not be comparable to similar measures disclosed
by other companies, since not all companies calculate these non-GAAP measures
in the same manner. FFO, Fully Converted FFO, EBITDA and Adjusted
EBITDA should not be considered as an alternative measure of our net income
(loss) or operating performance. FFO, Fully Converted FFO, EBITDA and Adjusted
EBITDA may include funds that may not be available for our discretionary
use due to functional requirements to conserve funds for capital expenditures
and property acquisitions and other commitments and uncertainties. Although
we believe that FFO, Fully Converted FFO, EBITDA and Adjusted EBITDA can
enhance your understanding of our financial condition and results of operations,
these non-GAAP financial measures, when viewed individually, are not necessarily
a better indicator of any trend as compared to comparable GAAP measures
such as net income. In addition, you should be aware that adverse economic
and market conditions might negatively impact our cash flow. Below, we
have provided a quantitative reconciliation of FFO, Fully Converted FFO,
EBITDA and Adjusted EBITDA to the most directly comparable GAAP financial
performance measure, which is net income (loss), and provide an explanatory
description by footnote of the items excluded from FFO, Fully Converted
FFO, EBITDA and Adjusted EBITDA. Prior year amounts have been adjusted
to conform to the current year presentation of a fully converted basis.
Reconciliation of Net Income
(Loss) Available to Common Shareholders to
EBITDA and Adjusted EBITDA
(in thousands)
Three Months Ended Six Months Ended
June 30, June
30,
2005 2004 2005
2004
Net income (loss) available to
common shareholders
$3,978 $(41,813) $10,728 $25,860
Depreciation and amortization -
continuing operations
14,225 19,906 24,812 40,057
Interest expense - continuing
operations
10,721 25,588 18,203 50,843
Interest expense - discontinued
operations
- -
- 577
Income taxes
1,794 135 2,872
314
Minority interests
1,901 (1,014) 4,104
(928)
Adjustments from unconsolidated
affiliates
1,086 1,793 2,022
3,279
Preferred shareholder dividend
2,154 -
2,503 -
EBITDA (a)
35,859 4,595 65,244 120,002
Realized portion of deferred gain
on
sale leasebacks
(1,104) - (2,246)
-
Adjusted EBITDA (a)
$34,755 $4,595 $62,998 $120,002
(a) EBITDA and Adjusted EBITDA have
not been adjusted for the following amounts included in net income (loss)
because these gains (losses) have either occurred during the prior two
years or are reasonably likely to occur within two years (in thousands).
-- Loss on early extinguishment
of debt from continuing operations amounted to $24,134 and $21,946 for
the three and six months ended June 30, 2004.
-- Gain on sale of assets
from discontinued operations amounted to $75,982 for the six months ended
June 30, 2004.
Reconciliation of Net Income (Loss)
Available to Common Shareholders to
Funds From Operations (FFO) and FFO - Fully Converted
(in thousands)
Three Months Ended Six Months Ended
June 30, June
30,
2005 2004 2005
2004
Net income (loss) available to common
shareholders
$3,978 $(41,813) $10,728 $25,860 Depreciation and amortization
- continuing operations
14,225 19,906 24,812 40,057 Gain
on sale of assets - continuing operations
(42) -
(42) - Gain on sale of assets - discontinued
operations
- -
- (75,982)
Realized portion of deferred gain
on
sale leasebacks
(1,104) - (2,246)
-
Deferred tax expense on realized
portion of deferred gain
on sale leasebacks
331 -
675 -
Minority interests adjustments
(2,618) (124) (5,247) (124)
Adjustments from unconsolidated
affiliates
535 828 1,045
1,799
FFO (a)
15,305 (21,203) 29,725 (8,390)
Convertible debt interest
expense -
2,052 - 4,105
Convertible minority interests
4,519 (890) 9,351
(804)
FFO - Fully Converted (a)
$19,824 $(20,041) $39,076 $(5,089)
(a) FFO and Fully Converted FFO have
not been adjusted for the following amounts included in net income (loss)
because these gains (losses) have either occurred during the prior two
years or are reasonably likely to occur within two years (in thousands).
-- Loss on early extinguishment
of debt from continuing operations amounted to $24,134 and $21,946 for
the three and six months ended June 30, 2004.
Seasonality by Geographic Region
Revenues have been adjusted to show
hotel performance on a comparable quarter-over-quarter basis. Adjustments
include (i) exclusion of Ritz-Carlton Half Moon Bay's partial year results;
(ii) presentation of Hyatt Regency New Orleans without the effect of the
operating lease that was in place prior to June 2004; (iii) presentation
of the European hotels without regard to either ownership structure or
leaseholds; and (iv) exclusion of InterContinental Chicago and InterContinental
Miami's partial year results.
United States Hotels (as of June 30,
2005)
9 Properties
4,710 Rooms
Three Months Ended
September December March 31, June 30,
2004 2004 2005
2005 Total
Total revenues
$63,119 $76,164 $82,734 $76,163 $298,180
Seasonality %
21.2% 25.5% 27.7%
25.6% 100.0%
Mexican Hotels (as of June 30, 2005)
2 Properties
380 Rooms
Three Months Ended
September December March 31, June 30,
2004 2004 2005
2005 Total
Total revenues
$10,222 $15,064 $17,085 $15,990 $58,361
Seasonality %
17.5% 25.8% 29.3%
27.4% 100.0%
Total North American Hotels (as of
June 30, 2005)
11 Properties
5,090 Rooms
Three Months Ended
September December March 31, June 30,
2004 2004 2005
2005 Total
Total revenues
$73,341 $91,228 $99,819 $92,153 $356,541
Seasonality %
20.6% 25.6% 28.0%
25.8% 100.0%
European Hotels (as of June 30, 2005)
3 Properties
841 Rooms
Three Months Ended
September December March 31, June 30,
2004 2004 2005
2005 Total
Total revenues
$23,010 $19,999 $16,708 $23,179 $82,896
Seasonality %
27.8% 24.1% 20.2%
27.9% 100.0%
Operating Statistics by Geographic Region
Operating results have been adjusted
to show hotel performance on a comparable quarter-over-quarter basis.
Adjustments include (i) exclusion of the seven properties distributed out
of the Company in connection with the IPO; (ii) exclusion of Ritz-Carlton
Half Moon Bay's partial year results; (iii) presentation of Hyatt Regency
New Orleans without the effect of the operating lease that was in place
prior to June 2004; (iv) presentation of the European hotels without regard
to either ownership structure or leaseholds; and (v) exclusion of InterContinental
Chicago and InterContinental Miami's partial year results.
United States Hotels (as of June 30,
2005)
9 Properties
4,710 Rooms
Three Months Ended
Six Months Ended
June 30,
June 30,
2005 2004 Change
2005 2004 Change
Average
Daily
Rate
$146.75 $138.89 5.7%
$152.15 $145.45 4.6%
Average
Occupancy 70.0%
70.9% (0.9) pts 71.1%
70.6% 0.5 pts
RevPAR $102.78
$98.53 4.3%
$108.14 $102.73 5.3%
Total
RevPAR $181.98
$172.67 5.4%
$190.61 $179.67 6.1%
Property
EBITDA
Margin
23.9% 23.4% 0.5 pts
26.6% 25.6% 1.0 pts
Mexican Hotels (as of June 30, 2005)
2 Properties
380 Rooms
Three Months Ended
Six Months Ended
June 30,
June 30,
2005 2004 Change
2005 2004 Change
Average
Daily
Rate
$344.82 $338.09 2.0%
$393.07 $380.18 3.4%
Average
Occupancy 73.3%
68.4% 4.9 pts 72.8%
70.4% 2.4 pts
RevPAR $252.65
$231.13 9.3%
$286.02 $267.78 6.8%
Total
RevPAR $462.41
$401.21 15.3% $480.88
$441.01 9.0%
Property
EBITDA
Margin
31.1% 30.2% 0.9 pts
34.4% 34.8% (0.4) pts
Total North American Hotels (as of
June 30, 2005)
11 Properties
5,090 Rooms
Three Months Ended
Six Months Ended
June 30,
June 30,
2005 2004 Change
2005 2004 Change
Average
Daily
Rate
$162.50 $153.53 5.8%
$170.92 $163.26 4.7%
Average
Occupancy 70.3%
70.7% (0.4) pts 71.2%
70.6% 0.6 pts
RevPAR $114.21
$108.62 5.1%
$121.69 $115.28 5.6%
Total
RevPAR $203.38
$190.06 7.0%
$212.74 $199.55 6.6%
Property
EBITDA
Margin
25.2% 24.5% 0.7 pts
27.9% 27.2% 0.7 pts
European Hotels (as of June 30, 2005)
3 Properties
841 Rooms
Three Months Ended
Six Months Ended
June 30,
June 30,
2005 2004 Change
2005 2004 Change
Average
Daily
Rate
$260.99 $231.58 12.7%
$240.33 $216.83 10.8%
Average
Occupancy 83.7%
86.8% (3.1) pts 76.8%
78.0% (1.2) pts
RevPAR $218.47
$200.99 8.7%
$184.53 $169.13 9.1%
Total
RevPAR $302.87
$283.66 6.8%
$262.04 $241.70 8.4%
Property
EBITDA
Margin
44.2% 43.5% 0.7 pts
38.5% 39.0% (0.5) pts
Selected Financial
and Operating Information by Property (In
Thousands, Except Operating Information)
The following tables present selected
financial and operating information by property for the three and six months
ended June 30, 2005 and 2004. Property EBITDA reflects property net
operating income plus depreciation and amortization.
Three Months Ended June 30,
2005 2004 % Change
HYATT REGENCY NEW ORLEANS
Selected Financial
Information (For purposes of comparison, we have provided financial information
for this property as if the hotel was subject to a management agreement
(it was on a lease prior to June 2004)):
Total revenues
$14,300 $16,187 (11.7)%
Property EBITDA
$4,053 $5,026 (19.4)%
Selected Operating
Information:
Rooms
1,184 1,184
-
Average occupancy
59.8% 70.4% (10.6)pts
ADR
$134.40 $142.03 (5.4)%
RevPAR
$80.36 $100.03 (19.7)%
Total RevPAR
$132.72 $150.24 (11.7)%
HYATT REGENCY PHOENIX Selected Financial
Information:
Total revenues
$8,878 $8,361 6.2
%
Property EBITDA
$1,827 $1,976 (7.5)%
Selected Operating
Information:
Rooms
712 712
-
Average occupancy
69.5% 63.0%
6.5 pts
ADR
$128.26 $124.26 3.2 %
RevPAR
$89.19 $78.31 13.9 %
Total RevPAR
$140.17 $129.04 8.6 %
HILTON BURBANK AIRPORT AND CONVENTION
CENTER Selected Financial Information:
Total revenues
$7,139 $5,558 28.4 %
Property EBITDA
$2,356 $1,327 77.5 %
Selected Operating
Information:
Rooms
488 488
-
Average occupancy
74.3% 59.2% 15.1
pts
ADR
$123.59 $112.31 10.0 %
RevPAR
$91.88 $66.47 38.2 %
Total RevPAR
$160.76 $125.16 28.4 %
MARRIOTT RANCHO LAS PALMAS RESORT Selected
Financial Information:
Total revenues
$8,518 $8,313 2.5
%
Property EBITDA
$614 $915 (32.9)%
Selected Operating
Information:
Rooms
444 444
-
Average occupancy
67.8% 69.6% (1.8)pts
ADR
$169.79 $151.55 12.0 %
RevPAR
$115.04 $105.41 9.1 %
Total RevPAR
$228.39 $222.89 2.5 %
HYATT REGENCY LA JOLLA AT AVENTINE
Selected Financial Information:
Total revenues
$9,721 $8,455 15.0 %
Property EBITDA
$2,323 $1,733 34.0 %
Selected Operating
Information:
Rooms
419 419
-
Average occupancy
77.9% 83.8% (5.9)pts
ADR
$165.25 $138.47 19.3 %
RevPAR
$128.73 $116.10 10.9 %
Total RevPAR
$254.95 $221.75 15.0 %
MARRIOTT SCHAUMBURG Selected Financial
Information:
Total revenues
$4,202 $3,885 8.2
%
Property EBITDA
$1,237 $876
41.2 %
Selected Operating
Information:
Rooms
398 398
-
Average occupancy
72.0% 71.0%
1.0 pts
ADR
$113.52 $105.06 8.1 %
RevPAR
$81.68 $74.60 9.5
%
Total RevPAR
$125.69 $116.21 8.2 %
MARRIOTT LINCOLNSHIRE RESORT Selected
Financial Information:
Total revenues
$8,776 $8,690 1.0
%
Property EBITDA
$1,200 $1,263 (5.0)%
Selected Operating
Information:
Rooms
390 390
-
Average occupancy
66.3% 71.9% (5.6)pts
ADR
$122.28 $110.64 10.5 %
RevPAR
$81.10 $79.58 1.9
%
Total RevPAR
$267.89 $265.26 1.0 %
LOEWS SANTA MONICA BEACH HOTEL Selected
Financial Information:
Total revenues
$10,886 $9,600 13.4 %
Property EBITDA
$3,517 $2,844 23.7 %
Selected Operating
Information:
Rooms
342 342
-
Average occupancy
85.1% 81.9%
3.2 pts
ADR
$257.85 $239.65 7.6 %
RevPAR
$219.33 $196.22 11.8 %
Total RevPAR
$349.78 $308.46 13.4 %
EMBASSY SUITES LAKE BUENA VISTA RESORT
Selected Financial Information:
Total revenues
$3,743 $3,471 7.8
%
Property EBITDA
$1,102 $1,024 7.6
%
Selected Operating
Information:
Rooms
333 333
-
Average occupancy
80.6% 80.1%
0.5 pts
ADR
$131.65 $124.15 6.0 %
RevPAR
$106.09 $99.38 6.8
%
Total RevPAR
$123.52 $114.54 7.8 %
RITZ-CARLTON HALF MOON BAY Selected
Financial Information:
Total revenues
$13,175 N/A
N/A
Property EBITDA
$2,705 N/A
N/A
Selected Operating
Information (This table includes statistical information only for our period
of ownership. For the three months ended June 30, 2004, average occupancy
was 62.7%, ADR was $325.11, RevPAR was $203.98 and Total RevPAR was $501.02
and for the six months ended June 30, 2004, average occupancy was 58.8%,
ADR was $303.81, RevPAR was $178.61 and Total RevPAR was $435.98):
Rooms
261 N/A
N/A
Average occupancy
71.3% N/A
N/A
ADR
$334.23 N/A
N/A
RevPAR
$238.20 N/A
N/A
Total RevPAR
$554.71 N/A
N/A
INTERCONTINENTAL CHICAGO Selected Financial
Information:
Total revenues
$17,620 N/A
N/A
Property EBITDA
$6,358 N/A
N/A
Selected Operating
Information (This table includes statistical information only for our period
of ownership. For the three months ended June 30, 2004, average occupancy
was 78.7%, ADR was $172.54, RevPAR was $135.71 and Total RevPAR was $213.90.
For the six months ended June 30, 2005, average occupancy was 68.1%, ADR
was $175.14, RevPAR was $119.33 and Total RevPAR was $182.56. For the six
months ended June 30, 2004, average occupancy was 66.4%, ADR was $157.92,
RevPAR was $104.82 and Total RevPAR was $167.52):
Rooms
807 N/A
N/A
Average occupancy
83.4% N/A
N/A
ADR
$193.47 N/A
N/A
RevPAR
$161.39 N/A
N/A
Total RevPAR
$239.93 N/A
N/A
INTERCONTINENTAL MIAMI Selected Financial
Information:
Total revenues
$11,044 N/A
N/A
Property EBITDA
$3,219 N/A
N/A
Selected Operating
Information (This table includes statistical information only for our period
of ownership. For the three months ended June 30, 2004, average occupancy
was 65.8%, ADR was $134.74, RevPAR was $88.71 and Total RevPAR was $167.17.
For the six months ended June 30, 2005, average occupancy was 78.4%, ADR
was $164.03, RevPAR was $128.52 and Total RevPAR was $222.81. For the six
months ended June 30, 2004, average occupancy was 72.1%, ADR was $149.05,
RevPAR was $107.54 and Total RevPAR was $191.69):
Rooms
641 N/A
N/A
Average occupancy
71.5% N/A
N/A
ADR
$145.55 N/A
N/A
RevPAR
$104.04 N/A
N/A
Total RevPAR
$189.33 N/A
N/A
FOUR SEASONS MEXICO CITY Selected Financial
Information:
Total revenues
$5,901 $5,397
9.3 %
Property EBITDA
$1,396 $1,452 (3.9)%
Selected Operating
Information:
Rooms
240 240
-
Average occupancy
68.1% 62.8%
5.3 pts
ADR
$219.66 $218.48 0.5
%
RevPAR
$149.64 $137.25 9.0
%
Total RevPAR
$270.19 $247.12 9.3
%
FOUR SEASONS PUNTA MITA RESORT Selected
Financial Information:
Total revenues
$10,089 $8,477 19.0
%
Property EBITDA
$3,571 $2,733 30.7
%
Selected Operating
Information:
Rooms
140 140
-
Average occupancy
82.1% 77.9%
4.2 pts
ADR
$522.86 $503.52 3.8
%
RevPAR
$429.24 $392.07 9.5
%
Total RevPAR
$791.92 $665.38 19.0 %
INTERCONTINENTAL PRAGUE
Selected Financial
Information (Amounts below are 100% of operations, of which SHCI owns 35%):
Total revenues
$10,024 $10,312 (2.8)%
Property EBITDA
$5,286 $5,246 0.8
%
Selected Operating
Information:
Rooms
372 372
-
Average Occupancy
83.5% 90.1% (6.6)pts
ADR
$238.84 $221.77 7.7 %
RevPAR
$199.46 $199.87 (0.2)%
Total RevPAR
$296.11 $304.62 (2.8)%
MARRIOTT HAMBURG
Selected Financial
Information (Amounts below are 100% of operations, of which SHCI owned
35% through March 2004):
Total revenues
$4,704 $4,409 6.7
%
Property EBITDA
$1,284 $1,203 6.7
%
Selected Operating
Information:
Rooms
277 277
-
Average occupancy
82.7% 83.1% (0.4)pts
ADR
$152.28 $143.82 5.9 %
RevPAR
$125.92 $119.57 5.3 %
Total RevPAR
$186.61 $174.91 6.7 %
PARIS MARRIOTT CHAMPS ELYSEES Selected
Financial Information:
Total revenues
$8,451 $6,988 20.9 %
Property EBITDA
$3,667 $2,999 22.3 %
Selected Operating
Information:
Rooms
192 192
-
Average occupancy
85.6% 85.6%
- pts
ADR
$454.46 $374.57 21.3 %
RevPAR
$388.80 $320.63 21.3 %
Total RevPAR
$483.69 $399.95 20.9 %
Six Months Ended June 30,
2005 2004 % Change
HYATT REGENCY NEW ORLEANS
Selected Financial
Information (For purposes of comparison, we have provided financial information
for this property as if the hotel was subject to a management agreement
(it was on a lease prior to June 2004)):
Total revenues
$31,957 $32,902 (2.9)%
Property EBITDA
$9,836 $10,370 (5.1)%
Selected Operating
Information:
Rooms
1,184 1,184
-
Average occupancy
61.9% 67.5% (5.6)pts
ADR
$144.02 $146.99 (2.0)%
RevPAR
$89.18 $99.19 (10.1)%
Total RevPAR
$149.12 $152.69 (2.3)%
HYATT REGENCY PHOENIX Selected Financial
Information:
Total revenues
$21,701 $21,025 3.2 %
Property EBITDA
$6,933 $7,390 (6.2)%
Selected Operating
Information:
Rooms
712 712
-
Average occupancy
75.5% 69.2%
6.3 pts
ADR
$142.78 $145.33 (1.8)%
RevPAR
$107.83 $100.61 7.2 %
Total RevPAR
$172.26 $162.25 6.2 %
HILTON BURBANK AIRPORT AND CONVENTION
CENTER Selected Financial Information:
Total revenues
$14,059 $11,824 18.9 %
Property EBITDA
$4,586 $3,303 38.8 %
Selected Operating
Information:
Rooms
488 488
-
Average occupancy
74.7% 64.6% 10.1
pts
ADR
$122.31 $113.81 7.5 %
RevPAR
$91.36 $73.47 24.4 %
Total RevPAR
$159.17 $133.13 19.6 %
MARRIOTT RANCHO LAS PALMAS RESORT Selected
Financial Information:
Total revenues
$19,318 $18,806 2.7 %
Property EBITDA
$3,093 $3,208 (3.6)%
Selected Operating
Information:
Rooms
444 444
-
Average occupancy
71.6% 72.9% (1.3)pts
ADR
$179.39 $166.74 7.6 %
RevPAR
$128.37 $121.62 5.6 %
Total RevPAR
$258.98 $252.12 2.7 %
HYATT REGENCY LA JOLLA AT AVENTINE
Selected Financial Information:
Total revenues
$18,950 $16,108 17.6 %
Property EBITDA
$4,425 $2,840 55.8 %
Selected Operating
Information:
Rooms
419 419
-
Average occupancy
77.3% 74.5%
2.8 pts
ADR
$163.81 $146.77 11.6 %
RevPAR
$126.61 $109.38 15.8 %
Total RevPAR
$249.87 $211.23 18.3 %
MARRIOTT SCHAUMBURG Selected Financial
Information:
Total revenues
$7,461 $7,132 4.6
%
Property EBITDA
$1,891 $1,301 45.3 %
Selected Operating
Information:
Rooms
398 398
-
Average occupancy
65.1% 64.3%
0.8 pts
ADR
$113.87 $107.23 6.2 %
RevPAR
$74.12 $68.91 7.6
%
Total RevPAR
$111.58 $106.66 4.6 %
MARRIOTT LINCOLNSHIRE RESORT Selected
Financial Information:
Total revenues
$16,216 $16,956 (4.4)%
Property EBITDA
$1,994 $2,184 (8.7)%
Selected Operating
Information:
Rooms
390 390
-
Average occupancy
61.7% 71.7% (10.0)pts
ADR
$119.56 $105.31 13.5 %
RevPAR
$73.79 $75.51 (2.3)%
Total RevPAR
$247.50 $258.79 (4.4)%
LOEWS SANTA MONICA BEACH HOTEL Selected
Financial Information:
Total revenues
$21,260 $18,869 12.7 %
Property EBITDA
$6,838 $5,709 19.8 %
Selected Operating
Information:
Rooms
342 342
-
Average occupancy
85.9% 81.3%
4.6 pts
ADR
$254.65 $239.00 6.5 %
RevPAR
$218.62 $194.32 12.5 %
Total RevPAR
$343.45 $303.15 13.3 %
EMBASSY SUITES LAKE BUENA VISTA RESORT
Selected Financial Information:
Total revenues
$7,971 $7,297 9.2
%
Property EBITDA
$2,656 $2,339 13.6 %
Selected Operating
Information:
Rooms
333 333
-
Average occupancy
82.2% 80.9%
1.3 pts
ADR
$138.80 $128.30 8.2 %
RevPAR
$114.05 $103.77 9.9 %
Total RevPAR
$132.25 $120.40 9.8 %
RITZ-CARLTON HALF MOON BAY Selected
Financial Information:
Total revenues
$22,823 N/A
N/A
Property EBITDA
$3,194 N/A
N/A
Selected Operating Information
(This table includes statistical information only for our period of ownership.
For the three months ended June 30, 2004, average occupancy was 62.7%,
ADR was $325.11, RevPAR was $203.98 and Total RevPAR was $501.02 and for
the six months ended June 30, 2004, average occupancy was 58.8%, ADR was
$303.81, RevPAR was $178.61 and Total RevPAR was $435.98):
Rooms
261 N/A
N/A
Average occupancy
64.9% N/A
N/A
ADR
$308.91 N/A
N/A
RevPAR
$200.33 N/A
N/A
Total RevPAR
$483.12 N/A
N/A
INTERCONTINENTAL CHICAGO Selected Financial
Information:
Total revenues
N/A N/A
N/A
Property EBITDA
N/A N/A
N/A
Selected Operating
Information (This table includes statistical information only for our period
of ownership. For the three months ended June 30, 2004, average occupancy
was 78.7%, ADR was $172.54, RevPAR was $135.71 and Total RevPAR was $213.90.
For the six months ended June 30, 2005, average occupancy was 68.1%, ADR
was $175.14, RevPAR was $119.33 and Total RevPAR was $182.56. For the six
months ended June 30, 2004, average occupancy was 66.4%, ADR was $157.92,
RevPAR was $104.82 and Total RevPAR was $167.52):
Rooms
N/A N/A
N/A
Average occupancy
N/A N/A
N/A
ADR
N/A N/A
N/A
RevPAR
N/A N/A
N/A
Total RevPAR
N/A N/A
N/A
INTERCONTINENTAL MIAMI Selected Financial
Information:
Total revenues
N/A N/A
N/A
Property EBITDA
N/A N/A
N/A
Selected Operating
Information (This table includes statistical information only for our period
of ownership. For the three months ended June 30, 2004, average occupancy
was 65.8%, ADR was $134.74, RevPAR was $88.71 and Total RevPAR was $167.17.
For the six months ended June 30, 2005, average occupancy was 78.4%, ADR
was $164.03, RevPAR was $128.52 and Total RevPAR was $222.81. For the six
months ended June 30, 2004, average occupancy was 72.1%, ADR was $149.05,
RevPAR was $107.54 and Total RevPAR was $191.69):
Rooms
N/A N/A
N/A
Average occupancy
N/A N/A
N/A
ADR
N/A N/A
N/A
RevPAR
N/A N/A
N/A
Total RevPAR
N/A N/A
N/A
FOUR SEASONS MEXICO CITY Selected Financial
Information:
Total revenues
$11,323 $11,083 2.2 %
Property EBITDA
$2,604 $2,967 (12.2)%
Selected Operating
Information:
Rooms
240 240
-
Average occupancy
66.0% 64.2%
1.8 pts
ADR
$222.28 $220.98 0.6 %
RevPAR
$146.80 $141.80 3.5 %
Total RevPAR
$260.66 $253.73 2.7 %
FOUR SEASONS PUNTA MITA RESORT Selected
Financial Information:
Total revenues
$21,752 $19,417 12.0 %
Property EBITDA
$8,770 $7,661 14.5 %
Selected Operating
Information:
Rooms
140 140
-
Average occupancy
84.3% 81.2%
3.1 pts
ADR
$622.49 $595.90 4.5 %
RevPAR
$524.67 $483.73 8.5 %
Total RevPAR
$858.41 $762.05 12.6 %
INTERCONTINENTAL PRAGUE
Selected Financial
Information (Amounts below are 100% of operations, of which SHCI owns 35%):
Total revenues
$16,675 $15,827 5.4 %
Property EBITDA
$7,478 $7,334 2.0
%
Selected Operating
Information:
Rooms
372 372
-
Average Occupancy
76.2% 76.5% (0.3)pts
ADR
$209.54 $194.51 7.7 %
RevPAR
$159.60 $148.81 7.3 %
Total RevPAR
$247.65 $233.77 5.9 %
MARRIOTT HAMBURG
Selected Financial
Information (Amounts below are 100% of operations, of which SHCI owned
35% through March 2004):
Total revenues
$8,454 $8,589 (1.6)%
Property EBITDA
$2,562 $2,374 7.9
%
Selected Operating
Information:
Rooms
277 277
-
Average occupancy
75.0% 79.0% (4.0)pts
ADR
$151.64 $148.71 2.0 %
RevPAR
$113.76 $117.49 (3.2)%
Total RevPAR
$168.62 $170.37 (1.0)%
PARIS MARRIOTT CHAMPS ELYSEES Selected
Financial Information:
Total revenues
$14,759 $12,579 17.3 %
Property EBITDA
$5,327 $4,713 13.0 %
Selected Operating
Information:
Rooms
192 192
-
Average occupancy
80.5% 79.4%
1.1 pts
ADR
$416.00 $356.22 16.8 %
RevPAR
$334.92 $283.00 18.3 %
Total RevPAR
$424.69 $359.98 18.0 %
Reconciliation of Property EBITDA to EBITDA
(in thousands)
Three Months Ended June 30,
2005
2004
Property Property
Hotel
EBITDA EBITDA EBITDA EBITDA
Hyatt Regency New Orleans
$4,053 $4,053 $5,026 $5,026
Hyatt Regency Phoenix
1,827 1,827 1,976
1,976
Hilton Burbank Airport and Convention
Center
2,356 2,356 1,327
1,327
Marriott Rancho Las Palmas Resort
614 614 915
915
Hyatt Regency La Jolla at Aventine
2,323 2,323 1,733
1,733
Marriott Schaumburg
1,237 1,237 876
876
Marriott Lincolnshire Resort
1,200 1,200 1,263
1,263
Loews Santa Monica Beach Hotel
3,517 3,517 2,844
2,844
Embassy Suites Lake Buena Vista
Resort
1,102 1,102 1,024
1,024
Ritz-Carlton Half Moon Bay
2,705 2,705 -
-
InterContinental Chicago (a)
6,358 6,358 -
-
InterContinental Miami (a)
3,219 3,219 -
-
Four Seasons Mexico City
1,396 1,396 1,452
1,452
Four Seasons Punta Mita Resort
3,571 3,571 2,733
2,733
InterContinental Prague (b)
5,286 - 5,246
-
Marriott Hamburg (c)
1,284 35 1,203
986
Paris Marriott Champs Elysees
(d) 3,667
233 2,999 3,013
$45,715 $35,746 $30,617 $25,168
Adjustments:
Distributed Property EBITDA
(see note
on page 7)
$-
$18,206
Corporate expenses
(4,650) (13,671)
Interest income
469
445
Loss on early extinguishment
of debt
-
(24,134)
Other income (expenses), net
2,961
(3,238)
Income from discontinued operations
-
-
Interest expense - discontinued
operations
-
-
Income taxes
247
26
Adjustments from unconsolidated
affiliates
1,086
1,793
EBITDA
$35,859
$4,595
Six Months Ended June 30,
2005
2004
Property Property
Hotel
EBITDA EBITDA EBITDA EBITDA
Hyatt Regency New Orleans
$9,836 $9,836 $10,370 $10,370
Hyatt Regency Phoenix
6,933 6,933 7,390
7,390
Hilton Burbank Airport and
Convention Center
4,586 4,586 3,303
3,303
Marriott Rancho Las Palmas Resort
3,093 3,093 3,208
3,208
Hyatt Regency La Jolla at Aventine
4,425 4,425 2,840
2,840
Marriott Schaumburg
1,891 1,891 1,301
1,301
Marriott Lincolnshire Resort
1,994 1,994 2,184
2,184
Loews Santa Monica Beach Hotel
6,838 6,838 5,709
5,709
Embassy Suites Lake Buena Vista
Resort
2,656 2,656 2,339
2,339
Ritz-Carlton Half Moon Bay
3,194 3,194 -
-
InterContinental Chicago (a)
- 6,358 -
-
InterContinental Miami (a)
- 3,219 -
-
Four Seasons Mexico City
2,604 2,604 2,967
2,967
Four Seasons Punta Mita Resort
8,770 8,770 7,661
7,661
InterContinental Prague (b)
7,478 - 7,334
-
Marriott Hamburg (c)
2,562 72 2,374
1,323
Paris Marriott Champs Elysees
(d) 5,327 471
4,713 4,757
$72,187 $66,940 $63,693 $55,352
Adjustments:
Distributed Property EBITDA
(see
note on page 7)
$-
$28,387
Corporate expenses
(9,407) (20,194)
Interest income
761
969
Loss on early extinguishment
of debt
-
(21,946)
Other income (expenses), net
4,623
(2,043)
Income from discontinued operations
-
75,662
Interest expense - discontinued
operations
-
577
Income taxes
305
(41)
Adjustments from unconsolidated
affiliates
2,022
3,279
EBITDA
$65,244 $120,002
(a) On April 1, 2005, we purchased
an 85% controlling interest in the joint ventures that own the InterContinental
Chicago and Miami hotels. We consolidate these hotels for reporting
purposes.
(b) We have a 35% interest in
the joint venture that owns the InterContinental Prague and account for
our investment under the equity method of accounting. Our equity
in earnings of the hotel joint venture is included in other income (expenses),
net in our consolidated statements of operations.
(c) On March 1, 2004, we acquired
the 65% interest we did not previously own in the joint venture that leases
the Hamburg Marriott. On June 29, 2004, we eliminated the collateralized
guarantee on the sale leaseback related to the property and no longer have
continuing involvement which required treating the transaction as a financing.
Accordingly, a sale of the Hamburg Marriott was recorded and the leaseback
has now been recorded as an operating lease as of June 29, 2004.
SHCI eliminated the finance obligation on the consolidated balance sheet
and now records lease expense instead of mortgage interest and depreciation
expense.
(d) On June 29, 2004, we eliminated
the collateralized guarantee related to the Paris Marriott Champs Elysees
and no longer have continuing involvement as defined by generally accepted
accounting principles. Accordingly, a sale of the Paris Marriott Champs
Elysees was recorded and the leaseback has now been recorded as an operating
lease as of June 29, 2004. SHCI eliminated the finance obligation
on the consolidated balance sheet and now records lease expense instead
of mortgage interest and depreciation expense. |
