SPOKANE, Wash., May 2, 2012 -- Red Lion Hotels Corporation
(NYSE: RLH), a western U.S. based owner and franchisor of midscale
hotels, today announced its results for the first quarter ended March 31, 2012. The company reported for the
first quarter revenues of $32.7 million
and EBITDA of $1.2 million both from
continuing operations before special items.
Overview:
- RevPAR for owned and leased hotels increased 7.3 percent
year-over-year
- Occupancy increased 360 basis points year-over-year
driven primarily by an increase in the transient segment
- ADR for owned and leased hotels was flat year-over-year
- Comparable EBITDA from continuing operations before
special items increased $1.7 million
compared with the first quarter of 2011
- Net loss from continuing operations was $6.6 million, including a pre-tax impairment
charge of $5.9 million; net loss from
continuing operations was $4.5 million
in the first quarter of 2011
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 Red Lion Hotel on Fifth Avenue in Seattle, which was sold in the second
quarter of 2011. Following the sale, this property continues to operate
as a franchised hotel and the company is therefore required to report
its financial results in continuing operations.
Total revenue from continuing operations reported during the
first quarter of 2012 was $32.7 million
compared to $33.6 million in the first
quarter of 2011. On a comparable basis, total revenue increased $1.9 million from $30.8
million in the first quarter of 2011. First quarter net loss
from continuing operations was $6.6 million,
or a net loss of $0.34 per share,
compared to a net loss from continuing operations of $4.5 million or a net loss of $0.24 per share, in the first quarter of 2011.
In the first quarter of 2012, comparable EBITDA from continuing
operations before special items improved to $1.2
million, compared to ($0.5) million
in the first quarter of 2011.
"During the first quarter, the company generated RevPAR growth
which outpaced the midscale hotel segment and resulted in an increase
in total revenue and EBITDA," said President and Chief Executive
Officer Jon E. Eliassen. "We
successfully implemented targeted sales and marketing programs that
allowed us to improve occupancy in what is typically our slowest
period, without sacrificing rate. Industry trends indicate that
midscale RevPAR growth will moderate for the rest of this year, so we
are not increasing our current guidance of 2-4 percent RevPAR growth
for 2012. We are continuing to focus on improving profitability and
successfully executing our three-pronged strategy to reduce debt,
expand our franchise program and improve the competitive position of
our hotels to enhance value for all Red Lion Hotels stakeholders."
Summary Results
On the basis of comparable continuing operations before
special items, key owned and leased hotel operating metrics and total
company EBITDA for the three months ended March
31, 2012, and March 31, 2011, are
highlighted below:
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
2012
|
2011
|
change
|
|
|
|
|
|
|
|
|
RevPAR
(revenue per available room)
|
$ 40.21
|
$ 37.47
|
7.3%
|
|
|
ADR
(average daily rate)
|
$ 77.29
|
$ 77.47
|
-0.2%
|
|
|
Occupancy
|
52.0%
|
48.4%
|
360
|
bps
|
|
|
|
|
|
|
|
Hotels
revenue:
|
|
|
|
|
|
Rooms
|
$
20,353
|
$
18,759
|
8.5%
|
|
|
Food
and beverage
|
7,417
|
7,286
|
1.8%
|
|
|
Other
revenue
|
571
|
648
|
-11.9%
|
|
|
Total
hotels revenue
|
$
28,341
|
$
26,693
|
6.2%
|
|
|
|
|
|
|
|
|
Hotel
direct operating margin
|
11.1%
|
9.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
EBITDA from continuing operations
|
|
|
|
|
|
before
special items(1)
|
$ 1,218
|
$ (527)
|
n/m
|
|
|
|
|
|
|
|
(1)
|
The
above excludes an asset impairment which is included in the non-GAAP
reconciliation schedule named, "Disclosure of Special Items" contained
in this release.
|
First Quarter 2012 Results
In the first quarter of 2012, for comparable owned and leased
hotels from continuing operations, RevPAR increased 7.3 percent
year-over-year driven by a 360 basis point increase in occupancy to
52.0 percent, partially offset by a 0.2 percent decline in ADR to $77.29. On a comparable basis, EBITDA from
continuing operations before special items improved to $1.2 million for the first quarter compared to
($0.5) million in the prior year
period. The acquisition of the previously leased iStar hotels
contributed facility lease savings of $0.9
million in the quarter.
Comparable hotel revenue of $28.3
million was 6.2 percent higher compared to the same period a
year ago. Comparable hotel direct operating margin increased to 11.1
percent from 9.1 percent in the same period in 2011 primarily driven by
a change in mix of promotional activities targeting the transient
segment and seasonal labor reductions.
Franchise revenue increased to $1.1
million from $0.7 million.
Profitability improved year-over-year primarily due to increased rooms
revenue at our franchised hotels.
Revenue in the entertainment segment declined $0.3 million primarily as a result of lower
sales volume in the ticketing portion of the business. However, overall
profitability for the segment improved as a result of the mix of shows
produced in the first quarter of 2012.
Asset Impairments
During the first quarter, the company recorded a pre-tax
asset impairment charge of $5.9 million
in continuing operations related to the company's assets held for sale
and fair market value indications received during the marketing process.
The company considers these impairment charges as special
items and these are excluded from reported EBITDA from continuing
operations before special items for the first quarter of 2012 and
separately identified in the company's operating results.
Liquidity and Balance Sheet
As of March 31, 2012, the company had $3.4 million in cash and cash equivalents, and
$10.0 million available on its line
of credit. As of March 31, 2012, the
company had outstanding debt of $100.2 million,
of which $30.8 million is classified as
current debt.
Capital expenditures during the first quarter totaled $1.2 million.
Outlook for 2012
The company is reaffirming its RevPAR guidance for 2012,
previously provided on February 28,
2012, based on the management team's outlook for the markets in which
the company operates and currently available information:
- Full year 2012 RevPAR for company owned and leased hotels
is expected to increase 2 to 4 percent compared to 2011 on an annual
basis.
- The company expects to invest approximately $10.0 million in capital improvements in 2012.
Conference Call Information
The management team of Red Lion Hotels will host a conference call on May 2, 2012, at 2:00
p.m. Pacific Time (5:00 p.m. Eastern Time),
to discuss financial and operational results for the first quarter of
2012. To access the conference call, domestic participants should dial
the following number ten minutes prior to the scheduled start time of
the call: (800) 230-1074. International participants should dial (612)
234-9960.
The conference call may also be accessed via live webcast at http://www.redlion.com
from the Investor Relations section of the website. To listen to the
live webcast, please go to the Red Lion website at least fifteen
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 4:00 p.m. Pacific Time on May 2, 2012, through June
2, 2012, at (800) 475-6701 or (320) 365-3844 (International)
access code – 245115. The replay will also be available shortly after
the call on the Red Lion website.
About Red Lion Hotels Corporation:
Red Lion Hotels Corporation is a hospitality and leisure
Company primarily engaged in the ownership, operation and franchising
of midscale hotels under its Red Lion® brand. As of March 31, 2012, the RLH hotel network was
comprised of 48 hotels located in nine states and one Canadian
province, with 9,010 rooms and 452,387 square feet of meeting space.
The Company also owns and operates an entertainment and event ticket
distribution business. For more information, please visit the Company's
website at www.redlion.com.
This press release contains forward-looking statements
within the meaning of federal securities law, including statements
concerning plans, objectives, goals, strategies, projections of future
events or performance and underlying assumptions (many of which are
based, in turn, upon further assumptions). The forward-looking
statements in this press release are inherently subject to a variety of
risks and uncertainties that could cause actual results to differ
materially from those expressed. Such risks and uncertainties include,
among others, economic cycles; international conflicts; changes in
future demand and supply for hotel rooms; competitive conditions in the
lodging industry; relationships with franchisees and properties; impact
of government regulations; ability to obtain financing; changes in
energy, healthcare, insurance and other operating expenses; ability to
sell non-core assets; ability to locate lessees for rental property;
dependency upon the ability and experience of executive officers and
ability to retain or replace such officers as well as other matters
discussed in the Company's annual report on Form 10-K for the year
ended December 31, 2011 and in other
documents filed by the Company with the Securities and Exchange
Commission.
Company Contact:
Pam Scott
Director of Corporate Communications
(509) 777-6393
Red
Lion Hotels Corporation
|
Consolidated
Statements of Operations
|
(unaudited)
|
($
in thousands, except footnotes and per share amounts)
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
2012
|
2011
|
$
Change
|
%
Change
|
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
|
|
Hotels
|
|
$
28,341
|
$
29,534
|
$
(1,193)
|
-4.0%
|
|
Franchise
|
|
1,089
|
707
|
382
|
54.0%
|
|
Entertainment
|
|
2,524
|
2,800
|
(276)
|
-9.9%
|
|
Other
|
|
743
|
607
|
136
|
22.4%
|
|
|
|
|
|
|
|
|
Total
revenues
|
|
32,697
|
33,648
|
(951)
|
-2.8%
|
|
|
|
|
|
|
|
Operating
expenses:
|
|
|
|
|
|
|
Hotels
|
|
25,189
|
26,400
|
(1,211)
|
-4.6%
|
|
Franchise
|
|
1,172
|
894
|
278
|
31.1%
|
|
Entertainment
|
|
2,203
|
2,614
|
(411)
|
-15.7%
|
|
Other
|
|
477
|
393
|
84
|
21.4%
|
|
Depreciation
and amortization
|
|
4,123
|
5,205
|
(1,082)
|
-20.8%
|
|
Hotel
facility and land lease
|
|
1,181
|
1,930
|
(749)
|
-38.8%
|
|
Asset
impairment
|
|
5,941
|
-
|
5,941
|
n/m
|
|
Loss
(gain) on asset dispositions, net
|
|
(104)
|
(86)
|
18
|
-20.9%
|
|
Undistributed
corporate expenses
|
|
1,381
|
1,344
|
37
|
2.8%
|
|
|
|
|
|
|
|
|
Total
expenses
|
|
41,563
|
38,694
|
2,869
|
7.4%
|
|
|
|
|
|
|
|
Operating
income (loss)
|
|
(8,866)
|
(5,046)
|
(3,820)
|
-75.7%
|
|
|
|
|
|
|
|
Other
income (expense):
|
|
|
|
|
|
|
Interest
expense
|
|
(1,817)
|
(2,301)
|
484
|
21.0%
|
|
Other
income, net
|
|
13
|
4
|
9
|
n/m
|
|
|
|
|
|
|
|
Income
(loss) before income taxes
|
|
(10,670)
|
(7,343)
|
(3,327)
|
-45.3%
|
|
|
|
|
|
|
|
Income
tax (benefit) expense
|
|
(4,074)
|
(2,843)
|
1,231
|
43.3%
|
|
|
|
|
|
|
|
Net
income (loss) from continuing operations
|
|
(6,596)
|
(4,500)
|
(2,096)
|
-46.6%
|
|
|
|
|
|
|
|
Discontinued
operations (2):
|
|
|
|
|
|
|
Income
(loss) from operations of discontinued business units,
|
|
|
|
|
|
|
net
of income tax (benefit) expense of $(58) and $(154) respectively
|
|
(102)
|
(271)
|
169
|
62.4%
|
|
Impairment
of the assets of the discontinued business units, net of
|
|
|
|
|
|
|
income tax (benefit) expense of $(266) and $0 respectively
|
|
(470)
|
-
|
(470)
|
n/m
|
|
|
|
|
|
|
|
Net
income (loss) from discontinued operations
|
|
(572)
|
(271)
|
(301)
|
n/m
|
|
|
|
|
|
|
|
Net
income (loss)
|
|
(7,168)
|
(4,771)
|
(2,397)
|
-50.2%
|
|
|
|
|
|
|
|
Less
net income or loss attributable to noncontrolling interest
|
|
(7)
|
(10)
|
3
|
30.0%
|
|
|
|
|
|
|
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
|
$
(7,161)
|
$
(4,761)
|
$
(2,400)
|
-50.4%
|
|
|
|
|
|
|
|
Earnings
per share - basic and diluted
|
|
|
|
|
|
|
Net
income (loss) from continuing operations
|
|
$
(0.34)
|
$
(0.24)
|
|
|
|
Net
Income (loss) from discontinued operations
|
|
$
(0.03)
|
$
(0.01)
|
|
|
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
|
$
(0.37)
|
$
(0.25)
|
|
|
Weighted
average shares - basic
|
|
19,222
|
18,974
|
|
|
Weighted
average shares - diluted
|
|
19,222
|
18,974
|
|
|
|
|
|
|
|
|
|
Non-GAAP
Financial Measures:
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
(1)
|
|
$
(5,619)
|
$ (151)
|
$
(5,468)
|
n/m
|
EBITDA
as a percentage of revenues
|
|
-17.2%
|
-0.4%
|
|
|
|
|
|
|
|
|
|
EBITDA
from continuing operations (1)
|
|
$
(4,723)
|
$ 173
|
$
(4,896)
|
n/m
|
EBITDA
from continuing operations
|
|
-14.4%
|
0.5%
|
|
|
|
as a
percentage of revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The
definition of "EBITDA" and how that measure relates to net income
(loss) attributable to Red Lion Hotels Corporation is discussed further
in this release under Non-GAAP Financial Measures.
|
|
|
(2)
|
During
the fourth quarter 2011, the company listed for sale its hotels in
Medford, Oregon and Missoula, Montana, two non-core assets in which the
company does not expect to maintain significant continuing involvement.
Accordingly, the operations of these properties have been classified as
discontinued operations for all periods presented.
|
|
|
Red
Lion Hotels Corporation
|
Consolidated
Balance Sheets
|
(unaudited)
|
($
in thousands, except share data)
|
|
|
|
|
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
|
2012
|
|
2011
|
Assets:
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash
and cash equivalents
|
|
$ 3,441
|
|
$ 1,981
|
|
|
Restricted
cash
|
|
3,358
|
|
3,358
|
|
|
Accounts
receivable, net
|
|
6,102
|
|
7,591
|
|
|
Inventories
|
|
1,305
|
|
1,346
|
|
|
Prepaid
expenses and other
|
|
2,369
|
|
1,973
|
|
|
Deferred
income taxes
|
|
7,553
|
|
4,291
|
|
|
Assets
held for sale
|
|
23,769
|
|
30,380
|
|
|
|
|
Total
current assets
|
|
47,897
|
|
50,920
|
|
|
|
|
|
|
|
|
Property
and equipment, net
|
|
229,939
|
|
232,589
|
|
Goodwill
|
|
8,512
|
|
8,512
|
|
Intangible
assets, net
|
|
6,992
|
|
6,992
|
|
Other
assets, net
|
|
5,708
|
|
5,883
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
assets
|
|
$
299,048
|
|
$
304,896
|
|
|
|
|
|
|
|
Liabilities:
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$ 5,439
|
|
$ 4,928
|
|
|
Accrued
payroll and related benefits
|
|
3,156
|
|
2,103
|
|
|
Accrued
interest payable
|
|
1,136
|
|
231
|
|
|
Advance
deposits
|
|
798
|
|
380
|
|
|
Other
accrued expenses
|
|
9,622
|
|
9,249
|
|
|
Revolving
credit facility
|
|
-
|
|
844
|
|
|
Long-term
debt, due within one year
|
|
30,802
|
|
3,274
|
|
|
|
|
Total
current liabilities
|
|
50,953
|
|
21,009
|
|
|
|
|
|
|
|
|
Long-term
debt, due after one year
|
|
38,535
|
|
66,378
|
|
Deferred
income
|
|
4,519
|
|
4,643
|
|
Deferred
income taxes
|
|
15,040
|
|
16,176
|
|
Debentures
due Red Lion Hotels Capital Trust
|
|
30,825
|
|
30,825
|
|
|
|
|
Total
liabilities
|
|
139,872
|
|
139,031
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
Red
Lion Hotels Corporation stockholders' equity
|
|
|
|
|
|
|
Preferred
stock - 5,000,000 shares authorized; $0.01 par value;
|
|
|
|
|
|
|
no
shares issued or outstanding
|
|
-
|
|
-
|
|
|
Common
stock - 50,000,000 shares authorized; $0.01 par value;
|
|
|
|
|
|
|
19,257,898
and 19,172,670 shares issued and outstanding
|
|
192
|
|
192
|
|
|
Additional
paid-in capital, common stock
|
|
149,556
|
|
149,027
|
|
|
Retained
earnings
|
|
9,428
|
|
16,589
|
|
|
|
|
Total
Red Lion Hotels Corporation stockholders' equity
|
|
159,176
|
|
165,808
|
|
|
|
|
|
|
|
|
|
|
Noncontrolling
interest
|
|
-
|
|
57
|
|
|
|
|
Total
stockholders' equity
|
|
159,176
|
|
165,865
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
liabilities and stockholders' equity
|
|
$
299,048
|
|
$
304,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Red
Lion Hotels Corporation
|
|
Additional
Hotel Statistics
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
System-wide
Hotels as of March 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
Meeting
Space
|
|
|
|
|
|
|
Hotels
|
Rooms
|
(sq.
ft.)
|
|
|
|
|
|
Red
Lion Owned or Leased Hotels (1):
|
|
|
|
|
|
|
|
|
Comparable Continuing Operations
|
28
|
5,563
|
280,574
|
|
|
|
|
|
Discontinued Operations
|
2
|
261
|
10,192
|
|
|
|
|
|
Red
Lion Franchised Hotels (1)
|
18
|
3,186
|
161,621
|
|
|
|
|
|
Total
Red Lion Hotels
|
48
|
9,010
|
452,387
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
Hotel Statistics from Continuing Operations (1,2)
|
|
|
|
|
|
|
|
|
Three
months ended March 31, 2012
|
|
Three
months ended March 31, 2011
|
|
|
Average
|
|
|
|
Average
|
|
|
|
|
Occupancy
(3)
|
ADR (4)
|
RevPAR
(5)
|
|
Occupancy
(3)
|
ADR (4)
|
RevPAR
(5)
|
|
Owned
and Leased Hotels
|
52.0%
|
$ 77.29
|
$ 40.21
|
|
48.4%
|
$ 77.47
|
$ 37.47
|
|
Franchised
Hotels
|
57.4%
|
$ 82.79
|
$ 47.56
|
|
55.1%
|
$ 82.69
|
$ 45.58
|
|
Total
System Wide
|
53.5%
|
$ 78.91
|
$ 42.22
|
|
50.2%
|
$ 79.04
|
$ 39.69
|
|
|
|
|
|
|
|
|
|
|
Change
from prior comparative period:
|
|
|
|
|
|
|
|
|
Owned
and Leased Hotels
|
3.6
|
-0.2%
|
7.3%
|
|
|
|
|
|
Franchised Hotels
|
2.3
|
0.1%
|
4.3%
|
|
|
|
|
|
Total
System Wide
|
3.3
|
-0.2%
|
6.4%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Includes
all hotels owned, leased and franchised, presented on a comparable
basis for hotel statistics. The Seattle property has been excluded from
the owned and leased hotel statistics and included in the franchised
statistics for all periods shown
|
|
|
(2)
|
Excludes
two hotels identified as discontinued operations.
|
|
|
(3)
|
Average
occupancy represents total paid rooms divided by total available rooms.
Total available rooms represents the number of rooms available
multiplied by the number of days in the reported period and includes
rooms taken out of service for renovation.
|
|
|
(4)
|
Average
daily rate ("ADR") represents total room revenues divided by the total
number of paid rooms occupied by hotel guests.
|
|
|
(5)
|
Revenue
per available room ("RevPAR") represents total room and related
revenues divided by total available rooms.
|
|
Red
Lion Hotels Corporation
|
|
Comparable
Operating Results and Data From Continuing Operations
|
|
(unaudited)
|
|
($
in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Certain
operating results for the periods included in this report are shown on
a comparable hotel basis. Comparable hotels are defined as properties
that are
|
|
owned
or leased by the company and the operations of which are included in
the consolidated results from continuing operations for the entirety of
the reporting
|
|
periods
being compared.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
total revenue (2)
|
|
|
|
|
$
32,697
|
|
$
30,807
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
hotel revenue (2)
|
|
|
|
|
28,341
|
|
26,693
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
hotel operating expense (3)
|
|
|
|
|
25,189
|
|
24,258
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
hotel direct operating profit (1)
|
|
|
|
|
3,152
|
|
2,435
|
|
|
|
Comparable
hotel direct operating margin (1)
|
|
|
|
|
11.1%
|
|
9.1%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comparable
total EBITDA from continuing operations before special items (4)
|
$
1,218
|
|
$
(527)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Operating
profit margins are calculated by dividing the applicable operating
profit by the related revenue amount. GAAP margins are calculated using
amounts
|
|
presented
in the consolidated statements of operations. Comparable margins are
calculated using amounts presented in the table above.
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
The
reconciliation of total and hotel revenue per the consolidated
statements of operations to comparable total and hotel revenue is as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
revenue per the consolidated statements of operations
|
|
|
|
|
$
32,697
|
|
$
33,648
|
|
|
|
less:
Revenue from Seattle Fifth Avenue property
|
|
|
|
|
-
|
|
(2,841)
|
|
|
|
Comparable
total revenue
|
|
|
|
|
$
32,697
|
|
$
30,807
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotel
revenue per the consolidated statements of operations
|
|
|
|
|
$
28,341
|
|
$
29,534
|
|
|
|
less:
Revenue from Seattle Fifth Avenue property
|
|
|
|
|
-
|
|
(2,841)
|
|
|
|
Comparable
hotel revenue
|
|
|
|
|
$
28,341
|
|
$
26,693
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3)
|
The
reconciliation of hotel operating expense per the consolidated
statements of operations to comparable hotel operating expense is as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hotel
operating expense per the consolidated statements of operations
|
|
|
|
|
$
25,189
|
|
$
26,400
|
|
|
|
less:
Operating expense from Seattle Fifth Avenue property
|
|
|
|
|
-
|
|
(2,142)
|
|
|
|
Comparable
hotel operating expense
|
|
|
|
|
$
25,189
|
|
$
24,258
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(4)
|
The
reconciliation of EBITDA from continuing operations before special
items per the table entitled "Disclosure of Special Items" to
comparable total EBITDA
|
|
before
special items is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA
before special items per the table "Disclosure of Special Items"
|
|
|
|
|
$ 1,218
|
|
$ 173
|
|
|
|
less:
EBITDA of Seattle Fifth Avenue property
|
|
|
|
|
-
|
|
(700)
|
|
|
|
Comparable
total EBITDA from continuing operations before special items
|
|
$
1,218
|
|
$
(527)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Red
Lion Hotels Corporation
|
Reconciliation
of EBITDA to Net Income Attributable to Red Lion Hotels Corporation
|
(unaudited)
|
($
in thousands)
|
|
|
|
|
|
|
|
|
|
|
The
following is a reconciliation of EBITDA and EBITDA from continuing
operations to net income (loss) attributable to Red Lion Hotels
Corporation for the periods presented:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
EBITDA from continuing operations
|
|
|
|
|
$
(4,723)
|
|
$ 173
|
|
Income
tax benefit (expense) - continuing operations
|
|
|
|
|
4,074
|
|
2,843
|
|
Interest
expense - continuing operations
|
|
|
|
|
(1,817)
|
|
(2,301)
|
|
Depreciation
and amortization - continuing operations
|
|
|
|
|
(4,123)
|
|
(5,205)
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
|
|
|
|
|
|
|
|
from
continuing operations
|
|
|
|
|
(6,589)
|
|
(4,490)
|
|
Income
(loss) on discontinued operations, net of tax
|
|
|
|
|
(572)
|
|
(271)
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
|
|
|
|
$
(7,161)
|
|
$
(4,761)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
|
2012
|
|
2011
|
|
|
|
|
|
|
|
|
|
EBITDA
|
|
|
|
|
$
(5,619)
|
|
$ (151)
|
|
Income
tax benefit (expense)
|
|
|
|
|
4,398
|
|
2,997
|
|
Interest
expense
|
|
|
|
|
(1,817)
|
|
(2,301)
|
|
Depreciation
and amortization
|
|
|
|
|
(4,123)
|
|
(5,306)
|
Net
income (loss) attributable to Red Lion Hotels Corporation
|
|
|
|
|
$
(7,161)
|
|
$
(4,761)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NON-GAAP
FINANCIAL MEASURES
|
EBITDA
is defined as net income attributable to Red Lion Hotels Corporation,
before interest, taxes, depreciation and amortization. EBITDA is
considered a non-GAAP financial measurement. We believe it is a useful
financial performance measure for us and for our shareholders and is a
complement to net income attributable to Red Lion Hotels Corporation
and other financial performance measures provided in accordance with
generally accepted accounting principles in the United States ("GAAP").
|
We use
EBITDA to measure financial performance because it excludes interest,
taxes, depreciation and amortization, which bear little or no
relationship to operating performance. By excluding interest expense,
EBITDA measures our financial performance irrespective of our capital
structure or how we finance our properties and operations. We generally
pay federal and state income taxes on a consolidated basis, taking into
account how the applicable taxing laws apply to our company in the
aggregate. By excluding taxes on income, we believe EBITDA provides a
basis for measuring the financial performance of our operations
excluding factors that our hotels and other operations cannot control.
By excluding depreciation and amortization expense, which can vary from
hotel to hotel based on historical cost and other factors unrelated to
the hotels' financial performance, EBITDA measures the financial
performance of our hotels without regard to their historical cost. For
all of these reasons, we believe that EBITDA provides us and investors
with information that is relevant and useful in evaluating our
business.
|
However,
because EBITDA excludes depreciation and amortization, it does not
measure the capital we require to maintain or preserve our long-lived
assets. In addition, because EBITDA does not reflect interest expense,
it does not take into account the total amount of interest we pay on
outstanding debt nor does it show trends in interest costs due to
changes in our borrowings or changes in interest rates. EBITDA, as
defined by us, may not be comparable to EBITDA as reported by other
companies that do not define EBITDA exactly as we define the term.
Because we use EBITDA to evaluate our financial performance, we
reconcile all EBITDA measures to net income attributable to Red Lion
Hotels Corporation, which is the most comparable financial measure
calculated and presented in accordance with GAAP. EBITDA does not
represent cash provided by operating activities determined in
accordance with GAAP, and should not be considered as an alternative to
operating income or net income attributable to Red Lion Hotels
Corporation determined in accordance with GAAP as an indicator of
performance or as an alternative to cash flows from operating
activities as an indicator of liquidity.
|
|
|
|
|
|
Red
Lion Hotels Corporation
|
|
Disclosure
of Special Items
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
|
|
During
the first quarter of 2012, the Company recorded $5.9 million in pre-tax
impairment charges in continuing operations related to its Red Lion
Denver Southeast and Red Lion Colonial Hotel properties. As a result,
the operations as presented in the accompanying financial statements
for the three months ended March 31, 2012 compared to 2011 do not
reflect a meaningful comparison between periods. The following table
represents a reconciliation of EBITDA from continuing operations before
special items to EBITDA from continuing operations per the consolidated
statement of operations.
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended March 31,
|
|
|
|
|
|
|
2012
|
2011
|
|
|
|
|
|
|
($
in thousands)
|
EBITDA
from continuing
operations
(1)
|
|
EBITDA
from continuing
operations
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount
before special items
|
$ 1,218
|
|
$ 173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Special
items:
|
|
|
|
|
|
|
|
|
|
Asset
impairment charges (2)
|
(5,941)
|
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount
per consolidated statement of operations
|
$
(4,723)
|
|
$ 173
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Amount
defined on the preceding table "Reconciliation of EBITDA to Net Income
Attributable to Red Lion Hotels Corporation".
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
Amounts
as included in the line items "Asset impairment" on the accompanying
consolidated statements of operations.
|
|