STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per Share data)
Three Months Ended
March 31,
-------------------------
%
2006 2005 Variance
------ ------ ---------
Revenues
Owned, leased and consolidated joint venture
hotels
$822 $813 1.1
Vacation ownership and residential sales and
services
194 231 (16.0)
Management fees, franchise fees and other
income
132 104 26.9
Other revenues from managed and franchised
properties (a)
293 258 13.6
------ ------ ---------
1,441 1,406 2.5
Costs and Expenses
Owned, leased and consolidated joint venture
hotels
640 641
0.2
Vacation ownership and residential
165 167
1.2
Selling, general, administrative and other
106 82 (29.3)
Restructuring and other special charges, net
9 --
n/m
Depreciation
68 105 35.2
Amortization
5 5
--
Other expenses from managed and franchised
properties (a)
293 258 (13.6)
------ ------ ---------
1,286 1,258 (2.2)
Operating income
155 148
4.7
Equity earnings from unconsolidated
ventures, net
6 13 (53.8)
Interest expense, net of interest income of
$6 and $2
(97) (62) (56.5)
Gain on asset dispositions and impairments,
net
25 1
n/m
------ ------ ---------
Income from continuing operations before
taxes and minority equity
89 100 (11.0)
Income tax expense
(14) (21) 33.3
Minority equity in net loss
2 --
n/m
------ ------ ---------
Income from continuing operations
77 79
(2.5)
Cumulative effect of accounting change
( (72) --
n/m
------ ------ ---------
Net income
$5 $79 (93.7)
====== ====== =========
Earnings (Loss) Per Share - Basic
Continuing operations
$0.35 $0.37 (5.4)
Cumulative effect of accounting change
(0.33) --
n/m
------ ------ ---------
Net income
$0.02 $0.37 (94.6)
====== ====== =========
Earnings (Loss) Per Share - Diluted
Continuing operations
$0.34 $0.36 (5.6)
Cumulative effect of accounting change
(0.32) --
n/m
------ ------ ---------
Net income
$0.02 $0.36 (94.4)
====== ====== =========
Weighted average number of Shares
215 212
====== ======
Weighted average number of Shares assuming
dilution
225 221
====== ======
(a) The Company includes in revenues the reimbursement
of costs
incurred on behalf of managed hotel
property owners and
franchisees with no added margin and
includes in costs and
expenses these reimbursed costs. These
costs relate primarily to
payroll costs at managed properties
where the Company is the
employer.
n/m = not meaningful
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
CONSOLIDATED BALANCE SHEETS
(in millions, except share data)
March 31, December 31,
2006 2005
------------ ------------
(unaudited)
Assets
Current assets:
Cash and cash equivalents
$760 $897
Restricted cash
286 295
Accounts receivable, net of allowance for
doubtful accounts of $48 and $50
576 642
Inventories
363 280
Prepaid expenses and other
161 169
------------ ------------
Total current assets
2,146 2,283
Investments
393 403
Plant, property and equipment, net
3,986 4,113
Assets held for sale (a)
2,848 2,955
Goodwill and intangible assets, net
2,299 2,298
Other assets (b)
410 402
------------ ------------
$12,082 $12,454
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Short-term borrowings and current
maturities of long-term debt (c)
$758 $1,219
Accounts payable
150 156
Accrued expenses
931 1,049
Accrued salaries, wages and benefits
212 297
Accrued taxes and other
108 158
------------ ------------
Total current liabilities
2,159 2,879
Long-term debt (c)
3,361 2,818
Long-term debt held for sale (d)
107 108
Deferred income taxes
514 562
Other liabilities
1,042 851
------------ ------------
7,183 7,218
Minority interest
23 25
Commitments and contingencies
Stockholders' equity:
Class A exchangeable preferred shares of
the Trust; $0.01 par value; authorized
30,000,000 shares; outstanding 562,222
and 562,222 shares at March 31, 2006
and
December 31, 2005, respectively
-- --
Class B exchangeable preferred shares of
the Trust; $0.01 par value; authorized
15,000,000 shares; outstanding 0 and
24,627 shares at March 31, 2006 and
December 31, 2005, respectively
-- --
Corporation common stock; $0.01 par
value; authorized 1,050,000,000 shares;
outstanding 216,254,061 and 217,218,781
shares at March 31, 2006 and December
31, 2005, respectively
2
2
Trust Class B shares of beneficial
interest; $0.01 par value; authorized
1,000,000,000 shares; outstanding
216,254,061 and 217,218,781 shares
at
March 31, 2006 and December 31, 2005,
respectively
2
2
Additional paid-in capital
5,106 5,412
Deferred compensation
-- (53)
Accumulated other comprehensive loss
(317) (322)
Retained earnings
83 170
------------ ------------
Total stockholders' equity
4,876 5,211
------------ ------------
$12,082 $12,454
============ ============
(a) Includes 35 hotels expected to be sold in connection
with the
definitive agreement signed on November
14, 2005 with Host Hotels
& Resorts, Inc. The Company completed
the sale of 28 of these
hotels on April 10, 2006 and expects
to sell the remaining seven
hotels in the second quarter of 2006.
(b) Includes restricted cash of $9 million and $12 million
at March
31, 2006 and December 31, 2005, respectively.
(c) Excludes Starwood's share of unconsolidated joint
venture debt
aggregating approximately $478 million
and $469 million at March
31, 2006 and December 31, 2005, respectively.
(d) Represents the debt that is expected to be assumed
by Host Hotels
& Resorts, Inc. in connection
with the definitive agreement signed
on November 14, 2005.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP to GAAP Reconciliations - Historical Data
(in millions)
Three Months Ended
March 31,
------------------------
%
2006 2005 Variance
------ ------ ---------
Reconciliation of Net Income to EBITDA and
Adjusted EBITDA
Net income
$5 $79 (93.7)
Interest expense(a)
108 69 56.5
Income tax expense
14 21 (33.3)
Depreciation(b)
76 114 (33.3)
Amortization(c)
7 6 16.7
------ ------ ---------
EBITDA
210 289 (27.3)
Gain on asset dispositions and impairments,
net
(25) (1) n/m
Restructuring and other special charges, net
9 --
n/m
Cumulative effect of accounting change
72 --
n/m
------ ------ ---------
Adjusted EBITDA
$266 $288 (7.6)
====== ====== =========
(a) Includes $5 million and $5 million of interest expense
related to
unconsolidated joint ventures for
the three months ended March 31,
2006 and 2005, respectively.
(b) Includes $8 million and $9 million of Starwood's share
of
depreciation expense of unconsolidated
joint ventures for the
three months ended March 31, 2006
and 2005, respectively.
(c) Includes $2 million and $1 million of Starwood's share
of
amortization expense of unconsolidated
joint ventures for the
three months ended March 31, 2006
and 2005, respectively.
Three Months Ended
March 31,
------------------
2006 2005
-------- --------
Cash Flow Data
Net income
$5 $79
(Increase) decrease in restricted cash
12 (58)
Adjustments to income from continuing operations,
changes in working capital, and other
128 38
-------- --------
Cash from operating activities
$145 $59
======== ========
Cash from (used for) investing activities
$204 $(69)
======== ========
Cash from (used for) financing activities
$(487) $2
======== ========
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP
to GAAP Reconciliations - Future Performance
(In millions)
Three Months Ended
Year Ended
June 30, 2006
December 31, 2006
------------------
-----------------
$124 Net income
$418
50 Interest expense
242
29 Income tax expense
195
83 Depreciation and amortization
335
------------------
-----------------
286 EBITDA
1,190
Gain on asset disposition and
-- impairments, net
(25)
Restructuring and other special
9 charges, net
23
Cumulative effect of accounting
-- change
72
------------------
-----------------
$295 Adjusted EBITDA
$1,260
==================
=================
Three Months Ended
Year Ended
June 30, 2006
December 31, 2006
------------------
-----------------
$124 Income from continuing operations
490
------------------
-----------------
$0.55 EPS.
$2.18
------------------
-----------------
Special Items
Restructuring and other special
9 charges, net
23
-- Debt defeasance costs
37
Gain on asset dispositions and
-- impairments, net
(25)
------------------
-----------------
9 Total special items - pre-tax
35
Income tax (benefit) expense on
(3) special items.
(13)
Reserves and credits associated
-- with tax matters
1
------------------
-----------------
6 Total special items - after-tax
23
------------------
-----------------
Income from continuing operations
$130 excluding special items
$513
------------------
-----------------
$0.58 EPS excluding special items
$2.28
==================
=================
Three Months Ended
Year Ended
June 30, 2005
December 31, 2005
------------------
-----------------
$145 Net income
$422
68 Interest expense
283
47 Income tax expense
218
108 Depreciation
423
6 Amortization
26
------------------
-----------------
374 EBITDA
1,372
Loss on asset dispositions and
17 impairments, net
30
-- Discontinued operations
2
Restructuring and other special
-- charges, net
13
------------------
-----------------
$391 Adjusted EBITDA
$1,417
==================
=================
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP to GAAP Reconciliations - Future
Performance (continued)
(in millions)
Reconciliation from Previous Full Year Guidance to Current
Full Year
Guidance
Previous full year 2006 EBITDA guidance (1)
$1,210
First Quarter Impact
Add: Q1 performance above prior guidance
28
Less: Residential and vacation ownership operating income
accelerated into Q1 from Q2
(10)
---------
18
Impact related to the Host transaction
Add: Expected balance of year results from retained Canadian
hotels
Revenues
110
Expenses
(90)
Add: Expected second quarter results from deferred hotels
to
be sold to Host in the second quarter
Revenues
37
Expenses
(27)
Less: Reduction in gain amortization (primarily due to
retained Canadian hotels)
(8)
---------
22
Balance of year forecast
Add: Increase in management and franchise fees
10
Add: Additional business interruption insurance
and other
income
10
Less: Reduced residential and vacation ownership
operating
income
(10)
---------
10
Current full year 2006 EBITDA guidance
$1,260
=========
Previous full year EPS guidance (1)
$2.14
Add: EPS associated with the EBITDA increase discussed
above
0.15
Less: Increased depreciation expense primarily associated
with the retained Canadian
hotels.
(0.04)
Less: Increased interest expense due to the retention
of
the Canadian hotels, delayed
closing of the Host
transaction and the retention
of the SHC bonds.
(0.08)
Add: Lower tax rate primarily due to the benefit
from the
payment of the second
quarter 2006 dividend from the
Trust.
0.14
Less: Higher shares outstanding primarily due to
adjustments to stock options
and restricted stock as
a result of the depairing
of the class B shares in
connection with the Host
transaction.
(0.03)
------------
Current full year 2006 EPS guidance
$2.28
============
(1) See Starwood's fourth quarter 2005 earnings release
for the
non-GAAP to GAAP reconciliation of
the previous EPS and EBITDA
guidance.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Non-GAAP to GAAP Reconciliations -
Same Store Owned Hotel Revenue and Expenses
(In millions)
Three Months Ended
March 31,
-------------------------
Same-Store
Owned Hotels (1)
%
Worldwide
2006 2005 Variance
------ ------ ---------
Revenue
Same-Store Owned Hotels
$735 $675 8.9
Hotels Sold or Closed in 2006 and 2005
(16 hotels)
5 56 (91.1)
Hotels Without Comparable Results
(14 hotels)
82 82
--
------ ------ ---------
Total Owned, Leased and Consolidated Joint
Venture Hotels Revenue
$822 $813 1.1
====== ====== =========
Costs and Expenses
Same-Store Owned Hotels
$570 $538 (6.0)
Hotels Sold or Closed in 2006 and 2005
(16 hotels)
5 44
88.6
Hotels Without Comparable Results
(14 hotels)
65 60
(8.3)
Other ancillary hotel operations
-- (1) (100.0)
------ ------ ---------
Total Owned, Leased and Consolidated Joint
Venture Hotels Costs and Expenses
$640 $641 0.2
====== ====== =========
Three Months Ended
March 31,
-------------------------
Same-Store Owned Hotels
%
North America
2006 2005 Variance
------ ------ ---------
Revenue
Same-Store Owned Hotels
$543 $485 12.0
Hotels Sold or Closed in 2006 and 2005
(14 hotels)
5 47 (89.4)
Hotels Without Comparable Results
(7 hotels)
72 62
16.1
------ ------ ---------
Total Owned, Leased and Consolidated Joint
Venture Hotels Revenue
$620 $594 4.4
====== ====== =========
Costs and Expenses
Same-Store Owned Hotels
$417 $387 (7.9)
Hotels Sold or Closed in 2006 and 2005
(14 hotels)
5 36
86.1
Hotels Without Comparable Results
(7 hotels)
54 44 (22.7)
Other ancillary hotel operations
(1) (2) (50.0)
------ ------ ---------
Total Owned, Leased and Consolidated Joint
Venture Hotels Costs and Expenses
$475 $465 (2.2)
====== ====== =========
Three Months Ended
March 31,
-------------------------
Same-Store Owned Hotels
%
International
2006 2005 Variance
------ ------ ---------
Revenue
Same-Store Owned Hotels
$192 $190 1.0
Hotels Sold or Closed in 2006 and
2005
(2 hotels)
-- 9 (100.0)
Hotels Without Comparable Results
(7 hotels)
10 20 (50.0)
------ ------ ---------
Total Owned, Leased and Consolidated Joint
Venture Hotels Revenue
$202 $219 (7.8)
====== ====== =========
Costs and Expenses
Same-Store Owned Hotels
$153 $151 (1.0)
Hotels Sold or Closed in 2006 and
2005
(2 hotels)
-- 8
100.0
Hotels Without Comparable Results
(7 hotels)
11 16
31.3
Other ancillary hotel operations
1 1
--
------ ------ ---------
Total Owned, Leased and Consolidated Joint
Venture Hotels Costs and Expenses
$165 $176 6.3
====== ====== =========
(1) Same-Store Owned Hotel Results exclude 16 hotels sold
or closed in
2006 and 2005 and 14 hotels without
comparable results.
STARWOOD
HOTELS & RESORTS WORLDWIDE, INC.
Owned Hotel Results - Same Store (1)
For the Three Months Ended
March 31, 2006
UNAUDITED
WORLDWIDE
NORTH AMERICA
---------------------- ---------------------
2006 2005 Var. 2006
2005 Var.
------- ------- -------------- ------- -----
111 Hotels
75 Hotels
---------------------- ---------------------
SAME STORE OWNED HOTELS
REVPAR ($)
119.15 108.54 9.8% 119.36 105.85 12.8%
ADR ($)
177.01 165.26 7.1% 177.57 160.55 10.6%
OCCUPANCY
(%) 67.3% 65.7%
1.6 67.2% 65.9% 1.3
47
29
---------------------- ---------------------
SHERATON
REVPAR ($)
94.35 87.33 8.0% 94.82
85.98 10.3%
ADR ($)
146.61 137.43 6.7% 151.52 137.28 10.4%
OCCUPANCY
(%) 64.4% 63.5%
0.9 62.6% 62.6% 0.0
27
18
---------------------- ---------------------
WESTIN
REVPAR ($)
142.10 128.48 10.6% 133.59 117.57 13.6%
ADR ($)
192.90 178.69 8.0% 178.60 159.84 11.7%
OCCUPANCY
(%) 73.7% 71.9%
1.8 74.8% 73.6% 1.2
10
2
---------------------- ---------------------
ST. REGIS/LUXURY
COLLECTION
REVPAR ($)
222.45 209.85 6.0% 290.19 255.90 13.4%
ADR ($)
345.34 349.41 (1.2%) 365.79 345.51 5.9%
OCCUPANCY
(%) 64.4% 60.1%
4.3 79.3% 74.1% 5.2
10
10
---------------------- ---------------------
W
REVPAR ($)
183.03 158.10 15.8% 183.03 158.10 15.8%
ADR ($)
253.90 228.50 11.1% 253.90 228.50 11.1%
OCCUPANCY
(%) 72.1% 69.2%
2.9 72.1% 69.2% 2.9
17
16
---------------------- ---------------------
OTHER
REVPAR ($)
78.16 71.58 9.2% 71.94
63.37 13.5%
ADR ($)
126.10 121.43 3.8% 123.28 116.51
5.8%
OCCUPANCY
(%) 62.0% 58.9%
3.1 58.4% 54.4% 4.0
INTERNATIONAL
-----------------------
2006 2005 Var.
------- ------- -------
36 Hotels
-----------------------
SAME STORE OWNED HOTELS
REVPAR ($)
118.54 116.47 1.8%
ADR ($)
175.36 179.38 (2.2%)
OCCUPANCY
(%)
67.6% 64.9% 2.7
18
-----------------------
SHERATON
REVPAR ($)
93.36 90.15 3.6%
ADR ($)
137.17 137.73 (0.4%)
OCCUPANCY
(%)
68.1% 65.5% 2.6
9
-----------------------
WESTIN
REVPAR ($)
176.18 172.07 2.4%
ADR ($)
254.80 263.60 (3.3%)
OCCUPANCY
(%)
69.1% 65.3% 3.8
8
-----------------------
ST. REGIS/LUXURY COLLECTION
REVPAR ($)
161.76 168.59 (4.1%)
ADR ($)
316.86 354.85 (10.7%)
OCCUPANCY
(%)
51.1% 47.5% 3.6
W
REVPAR ($)
ADR ($)
OCCUPANCY
(%)
1
-----------------------
OTHER
REVPAR ($)
114.17 119.15 (4.2%)
ADR ($)
137.60 139.59 (1.4%)
OCCUPANCY
(%)
83.0% 85.4% (2.4)
(1) Hotel Results exclude 16 hotels sold or closed and
14 hotels
without comparable results during
2005 & 2006
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Owned Hotel Results - Same Store (1)
For the Three Months Ended
March 31, 2006
UNAUDITED ($ thousands)
WORLDWIDE
NORTH AMERICA
------------------------ -------------------------
2006 2005 Var.
2006 2005 Var.
-------- -------- ------ -------- -------- -------
111 Hotels
75 Hotels
------------------------ -------------------------
SAME STORE OWNED
HOTELS
Total REVENUE 734,842
674,796 8.9% 543,439 485,199
12.0%
Total EXPENSE 569,939
537,871 (6.0%) 416,908 386,405 (7.9%)
47
29
------------------------ -------------------------
SHERATON
REVENUE
277,712 255,820 8.6% 183,639 163,778
12.1%
EXPENSE
223,405 210,692 (6.0%) 151,945 141,720 (7.2%)
27
18
------------------------ -------------------------
WESTIN
REVENUE
244,778 225,330 8.6% 182,059 163,910
11.1%
EXPENSE
173,645 164,920 (5.3%) 125,588 117,247 (7.1%)
10
2
------------------------ -------------------------
ST. REGIS/LUXURY
COLLECTION
REVENUE
76,248 71,943 6.0% 50,515
44,975 12.3%
EXPENSE
57,476 55,718 (3.2%) 32,113 29,162
(10.1%)
10
10
------------------------ -------------------------
W
REVENUE
89,451 78,706 13.7% 89,451 78,706
13.7%
EXPENSE
72,201 66,433 (8.7%) 72,201 66,433
(8.7%)
17
16
------------------------ -------------------------
OTHER
REVENUE
46,653 42,997 8.5% 37,775
33,830 11.7%
EXPENSE
43,212 40,108 (7.7%) 35,061 31,842
(10.1%)
INTERNATIONAL
------------------------
2006 2005 Var.
-------- -------- ------
36 Hotels
------------------------
SAME STORE OWNED HOTELS
Total REVENUE
191,403 189,597 1.0%
Total EXPENSE
153,031 151,467 (1.0%)
18
------------------------
SHERATON
REVENUE
94,073 92,042 2.2%
EXPENSE
71,460 68,972 (3.6%)
9
------------------------
WESTIN
REVENUE
62,719 61,420 2.1%
EXPENSE
48,057 47,673 (0.8%)
8
------------------------
ST. REGIS/LUXURY COLLECTION
REVENUE
25,733 26,968 (4.6%)
EXPENSE
25,363 26,556 4.5%
W
REVENUE
EXPENSE
1
------------------------
OTHER
REVENUE
8,878 9,167 (3.2%)
EXPENSE
8,151 8,266 1.4%
(1) Hotel Results exclude 16 hotels sold or closed and
14 hotels
without comparable results during
2005 & 2006
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Worldwide Hotel Results - Same Store
For the Three Months Ended March 31, 2006
UNAUDITED
Systemwide (1) - Systemwide (1)
-
North America
International
------------------------ ----------------------
2006 2005 Var. 2006
2005 Var.
--------- ------- ------ ------- ------- ------
TOTAL HOTELS
REVPAR ($)
104.92 93.61 12.1% 94.80 88.55
7.1%
ADR ($)
153.83 141.12 9.0% 148.60 141.34
5.1%
OCCUPANCY
(%) 68.2% 66.3% 1.9
63.8% 62.7% 1.1
SHERATON
REVPAR ($)
92.53 83.24 11.2% 89.23 82.05
8.8%
ADR ($)
138.79 126.40 9.8% 138.76 128.87
7.7%
OCCUPANCY
(%) 66.7% 65.9% 0.8
64.3% 63.7% 0.6
WESTIN
REVPAR ($)
127.43 113.35 12.4% 114.73 112.74
1.8%
ADR ($)
179.81 164.30 9.4% 179.56 183.67 (2.2%)
OCCUPANCY
(%) 70.9% 69.0% 1.9
63.9% 61.4% 2.5
ST. REGIS/LUXURY
COLLECTION
REVPAR ($)
228.56 202.31 13.0% 145.95 147.40 (1.0%)
ADR ($)
311.93 287.45 8.5% 273.79 279.84 (2.2%)
OCCUPANCY
(%) 73.3% 70.4% 2.9
53.3% 52.7% 0.6
W
REVPAR ($)
185.04 160.74 15.1% 122.99 87.63
40.4%
ADR ($)
256.84 232.74 10.4% 237.87 217.66
9.3%
OCCUPANCY
(%) 72.0% 69.1% 2.9
51.7% 40.3% 11.4
FOUR POINTS
REVPAR ($)
57.13 51.44 11.1% 69.34 61.96
11.9%
ADR ($)
91.44 84.00 8.9% 102.88 96.96
6.1%
OCCUPANCY
(%) 62.5% 61.2% 1.3
67.4% 63.9% 3.5
OTHER
REVPAR ($)
99.01 83.99 17.9%
ADR ($)
124.89 135.39 (7.8%)
OCCUPANCY
(%) 79.3% 62.0% 17.3
(1) Includes same store owned, leased, consolidated JV,
managed,
unconsolidated JV and franchised hotels
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Worldwide Hotel Results - Same Store
For the Three Months Ended March 31, 2006
UNAUDITED
Systemwide (1) Company Operated (2)
---------------------- ----------------------
2006 2005 Var. 2006
2005 Var.
------- ------- ------ ------- ------- ------
TOTAL WORLDWIDE
REVPAR
($) 101.18 91.72
10.3% 112.75 102.23 10.3%
ADR
($) 151.98 141.20
7.6% 166.79 155.36 7.4%
OCCUPANCY
(%) 66.6% 65.0% 1.6
67.6% 65.8% 1.8
NORTH AMERICA
REVPAR
($) 104.92 93.61
12.1% 124.71 111.21 12.1%
ADR
($) 153.83 141.12
9.0% 176.66 163.23 8.2%
OCCUPANCY
(%) 68.2% 66.3% 1.9
70.6% 68.1% 2.5
EUROPE
REVPAR
($) 95.62 95.48
0.1% 104.19 103.14 1.0%
ADR
($) 160.12 166.93
(4.1%) 173.52 181.65 (4.5%)
OCCUPANCY
(%) 59.7% 57.2% 2.5
60.0% 56.8% 3.2
ASIA PACIFIC
REVPAR
($) 94.26 87.31
8.0% 89.44 85.18 5.0%
ADR
($) 144.68 135.26
7.0% 140.35 134.56 4.3%
OCCUPANCY
(%) 65.1% 64.5% 0.6
63.7% 63.3% 0.4
AFRICA & MIDDLE EAST
REVPAR
($) 97.16 87.80
10.7% 97.16 86.86 11.9%
ADR
($) 149.72 128.61
16.4% 149.35 126.89 17.7%
OCCUPANCY
(%) 64.9% 68.3% (3.4)
65.1% 68.4% (3.3)
LATIN AMERICA
REVPAR
($) 90.73 72.52
25.1% 102.98 82.71 24.5%
ADR
($) 129.34 111.66
15.8% 145.35 122.69 18.5%
OCCUPANCY
(%) 70.1% 64.9% 5.2
70.8% 67.4% 3.4
(1) Includes same store owned, leased, consolidated JV,
managed,
unconsolidated JV and franchised hotels
(2) Includes same store owned, leased, consolidated JV,
managed and
unconsolidated JV hotels
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Management Fees, Franchise Fees and Other Income
For the Three Months Ended
March 31, 2006
UNAUDITED ($ millions)
Worldwide
--------------------------------------
2006 2005 Variance % Variance
------- ------- -------- ----------
Management Fees:
Base Fees
32 24
8 33.3%
Incentive Fees
24 12
12 100.0%
------- ------- -------- ----------
Total Management Fees
56 36
20 55.6%
Franchise Fees
36 30
6 20.0%
------- ------- -------- ----------
Total Management & Franchise
Fees
92 66
26 39.4%
Other Management & Franchise
Revenues (1)
10 10
- -
------- ------- -------- ----------
Total Management & Franchise
Revenues
102 76
26 34.2%
======= ======= ======== ==========
Other (2)
30 28
2 7.1%
------- ------- -------- ----------
Management Fees, Franchise Fees
and Other Income
132 104
28 26.9%
======= ======= ======== ==========
(1) Other Management & Franchise Fees primarily includes
the
amortization of deferred gains resulting
from the sales of hotels
subject to long-term management contracts
and termination fees.
(2) Other primarily includes revenues from Bliss and other
miscellaneous revenue.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Vacation Ownership
& Residential Revenues and Expenses
For the Three Months Ended March 31, 2006
UNAUDITED ($ millions)
2006 2005 %
Variance
--------- --------- ----------
Originated Sales Revenues (1) --
Vacation Ownership Sales
192 162
18.5%
Other Sales and Services Revenues (2)
33 28
17.9%
Deferred Revenues -- Percentage of
Completion
(64) 7
n/m
Deferred Revenues -- Other (3)
(6) (10)
40.0%
--------- --------- ----------
Vacation Ownership Sales and Services
Revenues
155 187
(17.1%)
Residential Sales and Services
Revenues
39 44
(11.4%)
--------- --------- ----------
Total Vacation Ownership & Residential
Sales and Services Revenues
194 231
(16.0%)
========= ========= ==========
Originated Sales Expenses (4) --
Vacation Ownership Sales
125 104
(20.2%)
Other Expenses (5)
39 31
(25.8%)
Deferred Expenses -- Percentage of
Completion
(31) 4
n/m
Deferred Expenses -- Other
3 (6)
n/m
--------- --------- ----------
Vacation Ownership Expenses
136 133
(2.3%)
Residential Expenses
29 34
14.7%
--------- --------- ----------
Total Vacation Ownership & Residential
Expenses
165 167
1.2%
========= ========= ==========
(1) Timeshare sales revenue originated at each sales location
before
deferrals of revenue for U.S. GAAP
reporting purposes
(2) Includes resort income, interest income, gain on sale
of notes
receivable, and miscellaneous other
revenues
(3) Includes deferral of revenue for contracts still in
rescission
period, contracts that do not yet
meet the requirements of SFAS
No. 66 or SFAS No. 152 and, in 2006,
provision for loan loss
(4) Timeshare cost of sales and sales & marketing
expenses before
deferrals of sales expenses for U.S.
GAAP reporting purposes
(5) Includes resort, general and administrative, and other
miscellaneous expenses
Note: Deferred revenue is calculated based on the Percentage
of
Completion ("POC") of the project. Deferred expenses,
also based on
POC, includes product costs and direct sales and marketing
costs only.
Indirect sales and marketing costs are no longer deferred
per SFAS 152
as of January 1, 2006.
n/m = not meaningful
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Debt Portfolio Summary
As of March 31, 2006
UNAUDITED
Avg
Interest Balance
% of Interest Maturity
Debt
Terms (in millions) Portfolio Rate
(in years)
---------------- -------- ------------- ---------
-------- ----------
Floating Rate
Debt:
Senior credit
facility
Revolving credit Various
facility
+ .525% $1,116
26% 5.33% 4.7
Mortgages and Various
other
424 10%
4.05% 1.2
Interest rate LIBOR
swaps
+ 4.23% 300
7% 9.23%
------------- --------- --------
Total Floating
1,840 43%
5.67% 3.7
Fixed Rate Debt:
Sheraton Holding
public debt
598 14%
7.47% 12.1
Senior notes (1)
1,485 35%
6.70% 3.7
Convertible debt
360 9%
3.50% 0.1
Mortgages and
other
136 3%
7.52% 8.9
Interest rate
swaps
(300) (7%) 7.88%
------------- --------- --------
Total Fixed
2,279 54%
6.34% 5.4
------------- --------- --------
Total
$4,119 97%
6.01% 4.8
============= ========= ========
Floating rate
debt classified
as held for
sale
30 1%
5.30% 3.8
Fixed rate debt
classified as
held for sale
77 2%
8.84% 11.3
------------- --------- --------
Total debt
classified as
held for sale
$107 3%
7.85% 9.2
============= ========= ========
Total Debt
$4,226 100%
6.09% 4.9
============= ========= ========
Maturities
------------------------------
less than 1 year $758
1-3 years 807
4-5 years 1,112
greater than 5 years 1,549
----------
$4,226
==========
------------------------------
(1) Balance consists of outstanding public debt of $1.497
billion and
a $15 million fair value adjustment
related to the unamortized
gain on fixed to floating interest
rate swaps terminated in
September 2002 and March 2004 and
a ($27) million fair value
adjustment related to current fixed
to floating interest rate
swaps.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotels without Comparable
Results & Other Selected Items
As of March 31, 2006
UNAUDITED ($ millions)
Properties without comparable results in 2006:
Property
Location
--------
--------
W New Orleans - French Quarter
New Orleans, LA
W New Orleans
New Orleans, LA
St. Regis Aspen
Aspen, CO
Sheraton Bal Harbour Beach Resort
Bal Harbour, FL
St. Regis New York
New York, NY
Caesars Paradise Stream
Mount Pocono, PA
St. Regis Hotel, San Francisco
San Francisco, CA
Hotel Des Bains
Venice Lido, Italy
The Westin Excelsior, Venice Lido
Venice Lido, Italy
Hotel Santa Maria de el Paular
Rascafria, Spain
Westin Regina Resort - Cancun
Cancun, Mexico
Sheraton Cancun Resort & Towers
Cancun, Mexico
Sheraton Fiji
Nadi, Fiji
Westin Royal Denarau
Nadi, Fiji
Properties sold or closed in 2006 and 2005:
Property
Location
--------
--------
Sheraton Denver Tech Center
Englewood, CO
Deerfield Beach Hilton
Ft. Lauderdale, FL
Raphael
Chicago, IL
Sheraton Chapel Hill
Chapel Hill, NC
St. Regis Washington, DC
Washington, DC
Sheraton Russell Hotel
New York, NY
Westin Philadelphia
Philadelphia, PA
Westin Princeton at Forrestal Village
Princeton, NJ
Sheraton Ft. Lauderdale Airport Hotel
Dania, FL
Westin Hotel Long Beach
Long Beach, CA
Sheraton Suites San Diego
San Diego, CA
Sheraton Framingham Hotel
Framingham, MA
Westin Embassy Row, Washington D.C.
Washington, DC
Sheraton Suites Key West
Key West, FL
Hotel Danieli
Venice, Italy
Sheraton Lisboa Hotel & Towers
Lisbon, Portugal
Selected Balance Sheet and Cash Flow Items:
Cash and cash equivalents
(including restricted cash of $295 million)
$1,055
Debt (including debt classified as held for sale)
$4,226
Revenues and Expenses Associated with Assets Sold in the
First Quarter
of 2006 or Expected to be Sold in the Second Quarter
of 2006 (1):
Q1 Q2
Q3 Q4 Full Year
--------------------------------------------
Hotels Sold in the First
Quarter of 2006:
2006
Revenues
$5 $- $-
$- $5
Expenses
$6 $- $-
$- $6
2005
Revenues
$21 $24 $18
$19 $82
Expenses
$15 $15 $15
$14 $59
Hotels Classified as Held
for Sale at March 31,
2006:
2006
Revenues
$271 $- $-
$- $271
Expenses
$206 $- $-
$- $206
2005
Revenues
$248 $310 $283 $304
$1,145
Expenses
$194 $209 $199 $211
$813
(1) Results consist of 5 hotels sold in the first quarter
of 2006 and
35 hotels which are classified as
held for sale at March 31, 2006.
These amounts are included in the
revenues and expenses from
owned, leased and consolidated joint
venture hotels in 2006 and
2005.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Capital Expenditures
For
the Three and Twelve Months Ended March 31, 2006
UNAUDITED ($ millions)
Capital Expenditures:
Owned, Leased and Consolidated Joint Venture
Hotels
70
Corporate/IT
11
------------
Subtotal
81
Vacation Ownership Capital Expenditures:
Capital expenditures (includes land acquisitions)
24
Net capital expenditures for inventory (1)
5
------------
Subtotal
29
Development Capital
20
------------
Total Capital Expenditures
130
============
(1) Represents gross inventory capital expenditures of
$39 less cost
of sales of $34 for the three months
ended March 31, 2006.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Summary of Portfolio by Properties & Rooms
As of March 31, 2006
UNAUDITED
NAD
EAME
LAD
---------------- --------------- ---------------
Owned
Hotels Rooms Hotels Rooms Hotels
Rooms
------- -------- ------- ------- ------- -------
Sheraton
30 14,839 11 3,060
7 3,235
Westin
18 9,108 8
1,949 3 901
Four Points
6 1,153 -
- -
-
W
12 4,294 -
- -
-
Luxury Collection
1 654
7 828 2
320
St. Regis
4 900
1 161 -
-
Other
11 2,634 -
- -
-
------- -------- ------- ------- ------- -------
Total Owned
82 33,582 27 5,998
12 4,456
Managed & UJV
Sheraton
41 20,561 71 20,761
13 2,370
Westin
36 19,882 8
2,303 -
-
Four Points
1 475
7 1,019 2
263
W
5 903
- -
1 237
Luxury Collection
6 1,427 7
1,303 8 188
St. Regis
3 596
1 95
- -
Le Meridien
6 1,192 72 16,640
3 839
Other
2 2,672 -
- -
-
------- -------- ------- ------- ------- -------
Total Managed & UJV 100
47,708 166 42,121
27 3,897
Franchised
Sheraton
119 37,190 27 6,747
4 1,294
Westin
24 8,724 3
1,142 3 598
Four Points
86 14,831 11 1,482
9 1,350
Luxury Collection
1 249 14
1,721 -
-
Le Meridien
3 982 11
3,820 -
-
------- -------- ------- ------- ------- -------
Total Franchised
233 61,976 66 14,912
16 3,242
----------------------------------------------------------------------
Systemwide
Sheraton
190 72,590 109 30,568
24 6,899
Westin
78 37,714 19 5,394
6 1,499
Four Points
93 16,459 18 2,501
11 1,613
W
17 5,197 -
- 1 237
Luxury Collection
8 2,330 28
3,852 10 508
St. Regis
7 1,496 2
256 -
-
Le Meridien
9 2,174 83 20,460
3 839
Other
13 5,306 -
- -
-
------- -------- ------- ------- ------- -------
Total Systemwide
415 143,266 259 63,031
55 11,595
======= ======== ======= ======= ======= =======
----------------------------------------------------------------------
ASIA
Total
--------------- ----------------
Owned
Hotels Rooms Hotels Rooms
------- ------- ------- --------
Sheraton
3 1,028 51 22,162
Westin
- - 29
11,958
Four Points
1 630 7
1,783
W
- - 12
4,294
Luxury Collection
- - 10
1,802
St. Regis
- -
5 1,061
Other
- - 11
2,634
------- ------- ------- --------
Total Owned
4 1,658 125 45,694
Managed & UJV
Sheraton
45 15,751 170 59,443
Westin
11 4,253 55 26,438
Four Points
2 387 12
2,144
W
1 253 7
1,393
Luxury Collection
- - 21
2,918
St. Regis
2 591 6
1,282
Le Meridien
23 5,205 104 23,876
Other
- -
2 2,672
------- ------- ------- --------
Total Managed & UJV
84 26,440 377 120,166
Franchised
Sheraton
18 6,793 168 52,024
Westin
5 1,226 35 11,690
Four Points
1 126 107 17,789
Luxury Collection
- - 15
1,970
Le Meridien
5 2,774 19
7,576
------- ------- ------- --------
Total Franchised
29 10,919 344 91,049
----------------------------------------------------------------------
Systemwide
Sheraton
66 23,572 389 133,629
Westin
16 5,479 119 50,086
Four Points
4 1,143 126 21,716
W
1 253 19
5,687
Luxury Collection
- - 46
6,690
St. Regis
2 591 11
2,343
Le Meridien
28 7,979 123 31,452
Other
- - 13
5,306
------- ------- ------- --------
Total Systemwide
117 39,017 846 256,909
======= ======= ======= ========
----------------------------------------------------------------------
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Vacation Ownership Inventory Pipeline
As of March 31, 2006
UNAUDITED
----------------------------------------------------------------------
# Resorts
--------------------------------
In In Active
Brand
Total (2) Operations Sales
----------------------------------------------------------------------
Sheraton
7 6
6
Westin
7 4
6
St. Regis
2 1
2
Unbranded
3 3
-
--------------------------------
Total SVO, Inc.
19 14
14
--------------------------------
Unconsolidated Joint Ventures
(UJV's)
2 1
1
--------------------------------
Total including UJV's
21 15
15
----------------------------------------------------------------------
----------------------------------------------------------------------
Total Intervals Including UJV's (7)
----------------------------------------------------------------------
----------------------------------------------------------------------
# of Units (1)
------------------------------------------------
Future
Brand
Pre-sales/ Capacity Total at
Completed(3) Development(4) (5),(6) Buildout
----------------------------------------------------------------------
Sheraton
2,574
137 1,703 4,414
Westin
625
564 325 1,514
St. Regis
25
22 -
47
Unbranded
124
- 1
125
-------------------------------------------------
Total SVO, Inc.
3,348
723 2,029 6,100
-------------------------------------------------
Unconsolidated Joint
Ventures (UJV's)
198
- 36
234
-------------------------------------------------
Total including
UJV's
3,546
723 2,065 6,334
----------------------------------------------------------------------
----------------------------------------------------------------------
Total Intervals
Including UJV's (7) 184,392
37,596 107,380 329,368
----------------------------------------------------------------------
(1) Lockoff units are considered as one unit for this
analysis.
(2) Includes resorts in operation, active sales, and announced
new
resorts, Sheraton Kauai and St. Regis
Punta Mita (UJV)
(3) Completed units include those units that have a certificate
of
occupancy.
(4) Units in Pre-sales/Development are in various stages
of
development (including the permitting
stage), most of which are
currently being offered for sale to
customers.
(5) Based on owned land and average density in existing
marketplaces
(6) Future units indicated above include planned timeshare
units on
land owned by the Company or applicable
UJV that have received all
major governmental land use approvals
for the development of
timeshare. There can be no assurance
that such units will in fact
be developed and, if developed, the
time period of such
development (which may be more than
several years in the future).
Some of the projects may require additional
third-party approvals
or permits for development and build
out and may also be subject
to legal challenges as well as a commitment
of capital by the
Company. The actual number of units
to be constructed may be
significantly lower than the number
of future units indicated.
(7) Assumes 52 intervals per unit. |