CHICAGO, Nov. 11, 2013 /PRNewswire/ -- Strategic
Hotels & Resorts, Inc. (NYSE: BEE) today reported results for
the third quarter ended September 30,
2013.
($ in millions,
except per share and operating metrics)
|
Third
Quarter
|
|
|
|
|
Earnings
Metrics
|
2013
|
2012
|
%
|
Net income/(loss)
attributable to common shareholders
|
$3.8
|
$(8.6)
|
N/A
|
Net income/(loss) per
diluted share
|
$0.00
|
$(0.05)
|
N/A
|
Comparable funds from
operations (Comparable FFO) (a)
|
$29.8
|
$17.0
|
75.4%
|
Comparable FFO per
diluted share (a)
|
$0.14
|
$0.08
|
75.0%
|
Comparable EBITDA
(a)
|
$60.1
|
$46.6
|
29.1%
|
|
|
|
|
Total North
American Portfolio Operating Metrics (b)
|
|
|
|
Average Daily Rate
(ADR)
|
$298.87
|
$278.23
|
7.4%
|
Occupancy
|
78.9%
|
76.6%
|
2.3 pts
|
Revenue per Available
Room (RevPAR)
|
$235.79
|
$213.08
|
10.7%
|
Total
RevPAR
|
$404.76
|
$371.28
|
9.0%
|
EBITDA
Margins
|
25.8%
|
21.8%
|
400 bps
|
|
|
|
|
North American
Same Store Operating Metrics (c)
|
|
|
|
ADR
|
$276.05
|
$257.57
|
7.2%
|
Occupancy
|
81.2%
|
78.5%
|
2.7 pts
|
RevPAR
|
$224.09
|
$202.27
|
10.8%
|
Total
RevPAR
|
$385.01
|
$354.07
|
8.7%
|
EBITDA
Margins
|
26.5%
|
23.6%
|
290 bps
|
|
|
(a)
|
Please refer to
the tables provided later in this press release for a
reconciliation of net income/(loss) to Comparable FFO, Comparable
FFO per share and Comparable EBITDA. Comparable FFO,
Comparable FFO per share and Comparable EBITDA are non-GAAP
measures and are further explained with the reconciliation
tables.
|
(b)
|
Operating
statistics reflect results from the Company's Total North American
portfolio (see portfolio definitions later in this press
release).
|
(c)
|
Operating
statistics reflect results from the Company's North American same
store portfolio (see portfolio definitions later in this press
release).
|
"Our performance in the third quarter was exceptional as our
best in class portfolio continues to lead the industry. With both
increasing rates and occupancy, revenues grew 16.2%, same store
RevPAR was up 10.8%, Comparable EBITDA grew 29.1%, and margins
expanded an impressive 290 basis points," said Raymond L. "Rip"
Gellein, Chairman and Chief Executive Officer of Strategic Hotels
& Resorts, Inc. "We are very encouraged by the trends we are
seeing in group business and transient demand, and continue to see
strong embedded growth in our portfolio. As a result, we have
raised our full year guidance accordingly."
Gellein continued, "Per our stated strategy, we continue to
focus on the disposition of at least one of our hotels to continue
to deleverage the balance sheet."
Third Quarter Highlights
- Total consolidated revenues were $237.6
million in the third quarter of 2013, a 16.2 percent
increase over the prior year period.
- Total North American portfolio RevPAR increased 10.7 percent in
the third quarter of 2013, driven by a 7.4 percent increase in ADR
and a 2.3 percentage point increase in occupancy compared to the
third quarter of 2012. Total RevPAR increased 9.0 percent
between periods with non-rooms revenue increasing by 8.3 percent
between periods.
- Comparable FFO was $0.14 per
diluted share in the third quarter of 2013, compared with
$0.08 per diluted share in the prior
year period, a 75.0 percent increase over the prior year
period.
- Comparable EBITDA was $60.1
million in the third quarter of 2013, compared with
$46.6 million in the prior year
period, a 29.1 percent increase between periods.
- Net income attributable to common shareholders was $3.8 million, or $0.00 per diluted share, in the third quarter of
2013, compared with net loss attributable to common shareholders of
$8.6 million, or $0.05 per diluted share, in the third quarter of
2012.
- Transient occupied room nights in the Total North American
portfolio increased 5.2 percent and group occupied room nights
increased 3.0 percent in the third quarter of 2013 compared to the
third quarter of 2012. Transient ADR increased 7.7 percent
compared to the third quarter of 2012 and group ADR increased 5.1
percent compared to the third quarter of 2012. Transient
revenues increased 13.3% compared to the third quarter of 2012 and
group revenues increased 8.3%, compared to the third quarter of
2012.
- North American same store RevPAR increased 10.8 percent in the
third quarter of 2013, driven by a 7.2 percent increase in ADR and
a 2.7 percent point increase in occupancy. Total RevPAR
increased 8.7 percent with non-rooms revenue increasing by 6.6
percent between periods.
- European RevPAR declined 2.8 percent (3.6 percent in constant
dollars) in the third quarter of 2013, driven by a 6.2 percentage
(7.0 percent in constant dollars) decrease in ADR, partially offset
by a 3.1 percent point increase in occupancy between periods.
European Total RevPAR decreased 6.9 percent in the third quarter of
2013 over the prior year period (7.9 percent in constant dollars).
- Total North American portfolio EBITDA margins expanded 400
basis points in the third quarter of 2013, compared to the third
quarter of 2012. North American same store EBITDA margins
expanded 290 basis points. The significant variance between
the two portfolios is largely driven by a real estate tax
assessment at the Hotel del Coronado in the third quarter of
2012. Adjusted for this and other one-time items, Total North
American portfolio EBITDA margins expanded 240 basis points while
North American same store EBITDA margins expanded 200 basis
points.
- Group room nights currently booked for 2013 are 2.8 percent
higher compared to room nights booked for 2012 at the same time
last year, with rates 4.2 percent higher, resulting in a 7.1
percent RevPAR increase.
- Group room nights currently booked for 2014 are 8.8 percent
higher compared to room nights booked for 2013 at the same time
last year, with rates 4.1 percent higher, resulting in a 13.2
percent RevPAR increase.
The company reported financial results for the nine month period
ended September 30, 2013 as
follows:
- Total consolidated revenues were $683.2
million for the nine month period ended September 30, 2013, a 16.9 percent increase over
the prior year period.
- Net loss attributable to common shareholders was $16.4 million, or $0.11 per diluted share, compared with net loss
attributable to common shareholders of $43.1
million, or $0.22 per diluted
share, for the nine month period ended September 30, 2012.
- Comparable FFO was $0.29 per
diluted share compared with $0.21 per
diluted share in the nine month period ended September 30, 2012, a 38.1% increase between
periods.
- Comparable EBITDA was $154.8
million compared with $130.7
million for the nine month period ended September 30, 2012, an 18.5 percent increase
between periods.
Preferred Dividends
On August 27, 2013, the Company's
board of directors declared a quarterly dividend of $0.53125 per share of 8.5 percent Series A
Cumulative Redeemable Preferred Stock paid on September 30, 2013 to shareholders of record as
of September 13, 2013, a quarterly
dividend of $0.51563 per share of
8.25 percent Series B Cumulative Redeemable Preferred Stock paid on
September 30, 2013 to shareholders of
record as of September 13, 2013 and a
quarterly dividend of $0.51563 per
share of 8.25 percent Series C Cumulative Redeemable Preferred
Stock paid on September 30, 2013 to
shareholders of record as of September 13,
2013.
Transaction Activity
On August 7, 2013, the Company
closed on a one-year extension of the loan secured by the Marriott
London Grosvenor Square hotel. Under the terms of the
agreement, the GBP LIBOR spread increases in steps throughout the
extension period from 210 basis points in August 2013 to 425 basis points in April
2014. The loan will mature in October
2014, has no principal amortization requirement and is
pre-payable with no penalty.
On September 9, 2013, the Company
closed on amendments to the cross-collateralized mortgage
agreements secured by the Westin St. Francis and Fairmont Chicago
hotels, which eliminate future principal amortization payments
subject to meeting certain financial and other requirements.
Prior to the amendments, the loans were subject to a 20-year
principal amortization schedule. Both mortgage agreements
will continue to bear interest at a fixed rate of 6.09 percent and
are set to mature in June 2017.
2013 Guidance
Based on the results of the first nine months of 2013 and
current forecasts for the remainder of the year, management is
raising its guidance ranges for full year 2013 RevPAR growth, Total
RevPAR growth, Comparable EBITDA, and Comparable FFO per fully
diluted share.
For the full-year ending December 31,
2013, the Company is providing the following revised
guidance ranges as compared to the previously stated
ranges:
Guidance
Metrics
|
Previous
Range
|
|
Revised
Range
|
RevPAR
|
6.0% -
7.0%
|
|
7.5% -
8.0%
|
Total
RevPAR
|
5.0% -
6.0%
|
|
6.5% -
7.0%
|
EBITDA Margin
expansion
|
100 – 125 basis
points
|
|
125 – 150 basis
points
|
Comparable
EBITDA
|
$200M -
$210M
|
|
$205M -
$215M
|
Comparable FFO per
diluted share
|
$0.35 -
$0.40
|
|
$0.38 -
$0.43
|
Portfolio Definitions
Total North American portfolio hotel comparisons for the third
quarter of 2013 are derived from the Company's hotel portfolio at
September 30, 2013, consisting of all
16 properties located in North
America, including unconsolidated joint ventures.
North American same store hotel comparisons for the third of
quarter 2013 are derived from the Company's hotel portfolio at
September 30, 2013, consisting of
properties located in North
America and held for five or more quarters, in which
operations are included in the consolidated results of the
Company. As a result, same store comparisons include 13
properties and exclude the JW Marriott Essex House Hotel, which was
acquired on September 14, 2012, and
the unconsolidated Hotel del Coronado and Fairmont Scottsdale
Princess hotels.
European hotel comparisons for the third quarter of 2013 are
derived from the Company's European owned and leased hotel
properties at September 30, 2013,
consisting of the Marriott London Grosvenor Square and the Marriott
Hamburg hotels.
Earnings Call
The Company will conduct its third quarter 2013 conference call
for investors and other interested parties on Tuesday, November 12, 2013 at 11:00 a.m. Eastern Time (ET). Interested
individuals are invited to access the call by dialing 800.688.0836
(toll international: 617.614.4072) with passcode 14570741. To
participate on the webcast, log on to the company's website at
http://www.strategichotels.comor
http://edge.media-server.com/m/p/9ffccf74/lan/en15 minutes before
the call to download the necessary software.
For those unable to listen to the call live, a taped rebroadcast
will be available beginning at 2 p.m.
ET on November 12, 2013
through 11:59 p.m. ET on November 19, 2013. To access the replay, dial
888.286.8010 (toll international: 617.801.6888) with passcode
39630997. A replay of the call will also be available on the
Internet at http://www.strategichotels.comor
http://www.earnings.comfor 30 days after the call.
The Company also produces supplemental financial data that
includes detailed information regarding its operating
results. This supplemental data is considered an integral
part of this earnings release. These materials are available
on the Strategic Hotels & Resorts' website at
www.strategichotels.com within the second quarter information
section.
About the Company
Strategic Hotels & Resorts, Inc. is a real estate investment
trust (REIT) which owns and provides value-enhancing asset
management of high-end hotels and resorts in the United States, Mexico and Europe. The Company currently has ownership
interests in 18 properties with an aggregate of 8,272 rooms and
840,000 square feet of meeting space. For a list of current
properties and for further information, please visit the Company's
website at http://www.strategichotels.com.
This press release contains forward-looking statements about
Strategic Hotels & Resorts, Inc. (the "Company"). Except for
historical information, the matters discussed in this press release
are forward-looking statements subject to certain risks and
uncertainties. These forward-looking statements include statements
regarding the Company's future financial results, stabilization in
the lodging space, positive trends in the lodging industry and the
Company's continued focus on improving profitability. Actual
results could differ materially from the Company's projections.
Factors that may contribute to these differences include, but are
not limited to the following: failure to complete or close on
transactions or the failure of closing conditions to be satisfied,
the effects of the recent global economic recession upon business
and leisure travel and the hotel markets in which the Company
invests; the Company's liquidity and refinancing demands; the
Company's ability to obtain, refinance or extend maturing
debt, including the $133 million
mortgage related to the Fairmont Scottsdale Princess hotel that
matures on December 31, 2013; the
Company's ability to maintain compliance with covenants contained
in its debt facilities; stagnation or further deterioration in
economic and market conditions, particularly impacting business and
leisure travel spending in the markets where the Company's hotels
operate and in which the Company invests, including luxury and
upper upscale product; general volatility of the capital markets
and the market price of the Company's shares of common stock;
availability of capital; the Company's ability to dispose of
properties in a manner consistent with its investment strategy and
liquidity needs; hostilities and security concerns, including
future terrorist attacks, or the apprehension of hostilities, in
each case that affect travel within or to the United States, Mexico, Germany, England or other countries where the Company
invests; difficulties in identifying properties to acquire and
completing acquisitions; the Company's failure to maintain
effective internal control over financial reporting and disclosure
controls and procedures; risks related to natural disasters;
increases in interest rates and operating costs, including
insurance premiums and real property taxes; contagious disease
outbreaks, such as the H1N1 virus outbreak; delays and
cost-overruns in construction and development; marketing challenges
associated with entering new lines of business or pursuing new
business strategies; the Company's failure to maintain its status
as a REIT; changes in the competitive environment in the Company's
industry and the markets where the Company invests; changes in real
estate and zoning laws or regulations; legislative or regulatory
changes, including changes to laws governing the taxation of REITs;
changes in generally accepted accounting principles, policies and
guidelines; and litigation, judgments or settlements.
Additional risks are discussed in the Company's filings with
the Securities and Exchange Commission, including those
appearing under the heading "Item 1A. Risk Factors" in the
Company's most recent Form 10-K and subsequent Form 10-Qs.
Although the Company believes the expectations reflected in
such forward-looking statements are based on reasonable
assumptions, it can give no assurance that its expectations
will be attained. The forward-looking statements are made as of the
date of this press release, and the Company undertakes no
obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future
events or otherwise, except as required by law.
The following tables reconcile projected 2013 net loss
attributable to common shareholders to projected Comparable EBITDA,
Comparable FFO and Comparable FFO per diluted share (in millions,
except per share data):
|
Low
Range
|
|
High
Range
|
Net Loss Attributable
to Common Shareholders
|
$(30.5)
|
|
$(20.5)
|
Depreciation and
Amortization
|
113.2
|
|
113.2
|
Interest
Expense
|
87.2
|
|
87.2
|
Income
Taxes
|
1.5
|
|
1.5
|
Non-controlling
Interests
|
(0.1)
|
|
(0.1)
|
Adjustments from
Consolidated Affiliates
|
(15.2)
|
|
(15.2)
|
Adjustments from
Unconsolidated Affiliates
|
23.9
|
|
23.9
|
Preferred Shareholder
Dividends
|
24.2
|
|
24.2
|
Realized Portion of
Deferred Gain on Sale Leasebacks
|
(0.2)
|
|
(0.2)
|
Loss on Sale of
Asset
|
0.8
|
|
0.8
|
Impairment Losses and
Other Charges
|
0.7
|
|
0.7
|
Other
Adjustments
|
(0.5)
|
|
(0.5)
|
Comparable
EBITDA
|
$205.0
|
|
$215.0
|
|
|
|
|
|
Low
Range
|
|
High
Range
|
Net Loss Attributable
to Common Shareholders
|
$(30.5)
|
|
$(20.5)
|
Depreciation and
Amortization
|
112.5
|
|
112.5
|
Realized Portion of
Deferred Gain on Sale Leasebacks
|
(0.2)
|
|
(0.2)
|
Loss on Sale of
Asset
|
0.8
|
|
0.8
|
Non-controlling
Interests
|
0.0
|
|
0.0
|
Adjustments from
Consolidated Affiliates
|
(7.9)
|
|
(7.9)
|
Adjustments from
Unconsolidated Affiliates
|
14.4
|
|
14.4
|
Impairment Losses and
Other Charges
|
0.7
|
|
0.7
|
Other
Adjustments
|
(9.3)
|
|
(9.3)
|
Comparable
FFO
|
80.5
|
|
90.5
|
Comparable FFO per
Diluted Share
|
$0.38
|
|
$0.43
|
|
|
|
|
|
|
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Consolidated
Statements of Operations
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Nine
Months Ended September 30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Revenues:
|
|
|
|
|
|
|
|
|
Rooms
|
|
$
|
144,150
|
|
|
$
|
119,067
|
|
|
$
|
393,072
|
|
|
$
|
323,709
|
|
Food and
beverage
|
|
69,625
|
|
|
63,283
|
|
|
221,260
|
|
|
197,693
|
|
Other hotel operating
revenue
|
|
22,417
|
|
|
21,040
|
|
|
65,132
|
|
|
59,338
|
|
Lease and other
revenue
|
|
1,416
|
|
|
1,175
|
|
|
3,776
|
|
|
3,505
|
|
Total
revenues
|
|
237,608
|
|
|
204,565
|
|
|
683,240
|
|
|
584,245
|
|
Operating Costs and
Expenses:
|
|
|
|
|
|
|
|
|
Rooms
|
|
38,525
|
|
|
32,069
|
|
|
110,711
|
|
|
90,628
|
|
Food and
beverage
|
|
56,359
|
|
|
47,355
|
|
|
170,763
|
|
|
143,065
|
|
Other departmental
expenses
|
|
59,401
|
|
|
52,908
|
|
|
173,827
|
|
|
153,557
|
|
Management
fees
|
|
7,024
|
|
|
6,182
|
|
|
20,767
|
|
|
18,012
|
|
Other hotel
expenses
|
|
14,771
|
|
|
13,988
|
|
|
47,826
|
|
|
40,360
|
|
Lease
expense
|
|
1,202
|
|
|
1,114
|
|
|
3,584
|
|
|
3,425
|
|
Depreciation and
amortization
|
|
26,244
|
|
|
25,649
|
|
|
80,459
|
|
|
76,416
|
|
Impairment losses and
other charges
|
|
728
|
|
|
—
|
|
|
728
|
|
|
—
|
|
Corporate
expenses
|
|
5,487
|
|
|
6,956
|
|
|
18,880
|
|
|
23,632
|
|
Total operating costs
and expenses
|
|
209,741
|
|
|
186,221
|
|
|
627,545
|
|
|
549,095
|
|
Operating
income
|
|
27,867
|
|
|
18,344
|
|
|
55,695
|
|
|
35,150
|
|
Interest
expense
|
|
(21,106)
|
|
|
(19,942)
|
|
|
(63,871)
|
|
|
(58,627)
|
|
Interest
income
|
|
12
|
|
|
42
|
|
|
45
|
|
|
122
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
451
|
|
|
(2,257)
|
|
|
3,252
|
|
|
(2,054)
|
|
Foreign currency
exchange (loss) gain
|
|
(9)
|
|
|
(996)
|
|
|
177
|
|
|
(1,169)
|
|
Other (expenses)
income, net
|
|
(832)
|
|
|
436
|
|
|
45
|
|
|
1,365
|
|
Income (loss) before
income taxes and discontinued operations
|
|
6,383
|
|
|
(4,373)
|
|
|
(4,657)
|
|
|
(25,213)
|
|
Income tax benefit
(expense)
|
|
430
|
|
|
600
|
|
|
(1,121)
|
|
|
(215)
|
|
Income (loss) from
continuing operations
|
|
6,813
|
|
|
(3,773)
|
|
|
(5,778)
|
|
|
(25,428)
|
|
Loss from
discontinued operations, net of tax
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(535)
|
|
Net Income
(Loss)
|
|
6,813
|
|
|
(3,773)
|
|
|
(5,778)
|
|
|
(25,963)
|
|
Net (income) loss
attributable to the noncontrolling interests in SHR's operating
partnership
|
|
(29)
|
|
|
17
|
|
|
22
|
|
|
126
|
|
Net loss attributable
to the noncontrolling interests in consolidated
affiliates
|
|
3,018
|
|
|
1,241
|
|
|
7,467
|
|
|
891
|
|
Net income (loss)
attributable to SHR
|
|
9,802
|
|
|
(2,515)
|
|
|
1,711
|
|
|
(24,946)
|
|
Preferred shareholder
dividends
|
|
(6,042)
|
|
|
(6,042)
|
|
|
(18,125)
|
|
|
(18,125)
|
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
3,760
|
|
|
$
|
(8,557)
|
|
|
$
|
(16,414)
|
|
|
$
|
(43,071)
|
|
Basic Income
(Loss) Per Share:
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to SHR common
shareholders
|
|
$
|
0.02
|
|
|
$
|
(0.04)
|
|
|
$
|
(0.08)
|
|
|
$
|
(0.22)
|
|
Loss from
discontinued operations attributable to SHR common
shareholders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
0.02
|
|
|
$
|
(0.04)
|
|
|
$
|
(0.08)
|
|
|
$
|
(0.22)
|
|
Weighted average
shares of common stock outstanding
|
|
206,767
|
|
|
206,523
|
|
|
206,163
|
|
|
198,872
|
|
Diluted Income
(Loss) Per Share:
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to SHR common
shareholders
|
|
$
|
—
|
|
|
$
|
(0.05)
|
|
|
$
|
(0.11)
|
|
|
$
|
(0.22)
|
|
Loss from
discontinued operations attributable to SHR common
shareholders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
—
|
|
|
$
|
(0.05)
|
|
|
$
|
(0.11)
|
|
|
$
|
(0.22)
|
|
Weighted average
shares of common stock outstanding
|
|
220,258
|
|
|
218,182
|
|
|
217,553
|
|
|
198,872
|
|
|
|
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Consolidated
Balance Sheets
(in thousands,
except share data)
|
|
|
|
|
|
|
|
September 30,
2013
|
|
December 31,
2012
|
Assets
|
|
|
|
|
Investment in hotel
properties, net
|
|
$
|
1,915,212
|
|
|
$
|
1,970,560
|
|
Goodwill
|
|
40,359
|
|
|
40,359
|
|
Intangible assets,
net of accumulated amortization of $12,143 and $10,812
|
|
29,185
|
|
|
30,631
|
|
Investment in
unconsolidated affiliates
|
|
106,914
|
|
|
112,488
|
|
Cash and cash
equivalents
|
|
79,801
|
|
|
80,074
|
|
Restricted cash and
cash equivalents
|
|
75,183
|
|
|
58,579
|
|
Accounts receivable,
net of allowance for doubtful accounts of $1,611 and
$1,602
|
|
52,794
|
|
|
45,620
|
|
Deferred financing
costs, net of accumulated amortization of $10,887 and
$7,049
|
|
9,931
|
|
|
11,695
|
|
Deferred tax
assets
|
|
3,027
|
|
|
2,203
|
|
Prepaid expenses and
other assets
|
|
48,901
|
|
|
54,208
|
|
Total
assets
|
|
$
|
2,361,307
|
|
|
$
|
2,406,417
|
|
|
|
|
|
|
Liabilities,
Noncontrolling Interests and Equity
|
|
|
|
|
Liabilities:
|
|
|
|
|
Mortgages and other
debt payable
|
|
$
|
1,162,567
|
|
|
$
|
1,176,297
|
|
Bank credit
facility
|
|
137,000
|
|
|
146,000
|
|
Accounts payable and
accrued expenses
|
|
218,410
|
|
|
228,397
|
|
Deferred tax
liabilities
|
|
47,146
|
|
|
47,275
|
|
Total
liabilities
|
|
1,565,123
|
|
|
1,597,969
|
|
Commitments and
contingencies
|
|
|
|
|
Noncontrolling
interests in SHR's operating partnership
|
|
7,404
|
|
|
5,463
|
|
Equity:
|
|
|
|
|
SHR's shareholders'
equity:
|
|
|
|
|
8.50% Series A
Cumulative Redeemable Preferred Stock ($0.01 par value per share;
4,148,141 shares issued and outstanding; liquidation preference
$25.00 per share plus accrued distributions and $103,704 in the
aggregate)
|
|
99,995
|
|
|
99,995
|
|
8.25% Series B
Cumulative Redeemable Preferred Stock ($0.01 par value per share;
3,615,375 shares issued and outstanding; liquidation preference
$25.00 per share plus accrued distributions and $90,384 in the
aggregate)
|
|
87,064
|
|
|
87,064
|
|
8.25% Series C
Cumulative Redeemable Preferred Stock ($0.01 par value per share;
3,827,727 shares issued and outstanding; liquidation preference
$25.00 per share plus accrued distributions and $95,693 in the
aggregate)
|
|
92,489
|
|
|
92,489
|
|
Common stock ($0.01
par value per share; 350,000,000 shares of common stock authorized;
205,527,049 and 204,308,710 shares of common stock issued and
outstanding)
|
|
2,055
|
|
|
2,043
|
|
Additional paid-in
capital
|
|
1,710,267
|
|
|
1,730,535
|
|
Accumulated
deficit
|
|
(1,244,216)
|
|
|
(1,245,927)
|
|
Accumulated other
comprehensive loss
|
|
(44,896)
|
|
|
(58,871)
|
|
Total SHR's
shareholders' equity
|
|
702,758
|
|
|
707,328
|
|
Noncontrolling
interests in consolidated affiliates
|
|
86,022
|
|
|
95,657
|
|
Total
equity
|
|
788,780
|
|
|
802,985
|
|
Total liabilities,
noncontrolling interests and equity
|
|
$
|
2,361,307
|
|
|
$
|
2,406,417
|
|
|
|
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Financial
Highlights
Supplemental
Financial Data
(in thousands,
except per share information)
|
|
|
|
|
|
September 30,
2013
|
|
|
Pro Rata Share
|
|
Consolidated
|
Capitalization
|
|
|
|
|
Shares of common
stock outstanding
|
|
205,527
|
|
|
205,527
|
|
Operating partnership
units outstanding
|
|
853
|
|
|
853
|
|
Restricted stock
units outstanding
|
|
1,633
|
|
|
1,633
|
|
Combined shares and
units outstanding
|
|
208,013
|
|
|
208,013
|
|
Common stock price at
end of period
|
|
$
|
8.68
|
|
|
$
|
8.68
|
|
Common equity
capitalization
|
|
$
|
1,805,553
|
|
|
$
|
1,805,553
|
|
Preferred equity
capitalization (at $25.00 face value)
|
|
289,102
|
|
|
289,102
|
|
Consolidated
debt
|
|
1,299,567
|
|
|
1,299,567
|
|
Pro rata share of
unconsolidated debt
|
|
239,400
|
|
|
—
|
|
Pro rata share of
consolidated debt
|
|
(133,042)
|
|
|
—
|
|
Cash and cash
equivalents
|
|
(79,801)
|
|
|
(79,801)
|
|
Total enterprise
value
|
|
$
|
3,420,779
|
|
|
$
|
3,314,421
|
|
Net Debt / Total
Enterprise Value
|
|
38.8
|
%
|
|
36.8
|
%
|
Preferred Equity /
Total Enterprise Value
|
|
8.4
|
%
|
|
8.7
|
%
|
Common Equity / Total
Enterprise Value
|
|
52.8
|
%
|
|
54.5
|
%
|
|
|
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Investments in
Unconsolidated Affiliates
(in
thousands)
|
|
We have a 36.4% and
50.0% ownership interest in the Hotel del Coronado hotel and the
Fairmont Scottsdale Princess hotel, respectively. We account for
these investments using the equity method of accounting.
|
|
|
|
|
|
|
|
Three Months Ended
September 30, 2013
|
|
Three Months Ended
September 30, 2012
|
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
Total revenues
(100%)
|
|
$
|
47,279
|
|
|
$
|
14,338
|
|
|
$
|
61,617
|
|
|
$
|
44,978
|
|
|
$
|
10,607
|
|
|
$
|
55,585
|
|
Property EBITDA
(100%)
|
|
$
|
18,667
|
|
|
$
|
(302)
|
|
|
$
|
18,365
|
|
|
$
|
14,560
|
|
|
$
|
(2,163)
|
|
|
$
|
12,397
|
|
Equity in earnings
(losses) of unconsolidated affiliates (SHR ownership)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
EBITDA
|
|
$
|
6,790
|
|
|
$
|
(151)
|
|
|
$
|
6,639
|
|
|
$
|
4,994
|
|
|
$
|
(1,082)
|
|
|
$
|
3,912
|
|
Depreciation and
amortization
|
|
(1,896)
|
|
|
(1,533)
|
|
|
(3,429)
|
|
|
(1,711)
|
|
|
(1,774)
|
|
|
(3,485)
|
|
Interest
expense
|
|
(1,950)
|
|
|
(195)
|
|
|
(2,145)
|
|
|
(2,522)
|
|
|
(191)
|
|
|
(2,713)
|
|
Other expenses,
net
|
|
(205)
|
|
|
(16)
|
|
|
(221)
|
|
|
(19)
|
|
|
(5)
|
|
|
(24)
|
|
Income
taxes
|
|
(339)
|
|
|
—
|
|
|
(339)
|
|
|
(74)
|
|
|
—
|
|
|
(74)
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
2,400
|
|
|
$
|
(1,895)
|
|
|
$
|
505
|
|
|
$
|
668
|
|
|
$
|
(3,052)
|
|
|
$
|
(2,384)
|
|
EBITDA
Contribution:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
2,400
|
|
|
$
|
(1,895)
|
|
|
$
|
505
|
|
|
$
|
668
|
|
|
$
|
(3,052)
|
|
|
$
|
(2,384)
|
|
Depreciation and
amortization
|
|
1,896
|
|
|
1,533
|
|
|
3,429
|
|
|
1,711
|
|
|
1,774
|
|
|
3,485
|
|
Interest
expense
|
|
1,950
|
|
|
195
|
|
|
2,145
|
|
|
2,522
|
|
|
191
|
|
|
2,713
|
|
Income
taxes
|
|
339
|
|
|
—
|
|
|
339
|
|
|
74
|
|
|
—
|
|
|
74
|
|
EBITDA
Contribution
|
|
$
|
6,585
|
|
|
$
|
(167)
|
|
|
$
|
6,418
|
|
|
$
|
4,975
|
|
|
$
|
(1,087)
|
|
|
$
|
3,888
|
|
FFO
Contribution:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
2,400
|
|
|
$
|
(1,895)
|
|
|
$
|
505
|
|
|
$
|
668
|
|
|
$
|
(3,052)
|
|
|
$
|
(2,384)
|
|
Depreciation and
amortization
|
|
1,896
|
|
|
1,533
|
|
|
3,429
|
|
|
1,711
|
|
|
1,774
|
|
|
3,485
|
|
FFO
Contribution
|
|
$
|
4,296
|
|
|
$
|
(362)
|
|
|
$
|
3,934
|
|
|
$
|
2,379
|
|
|
$
|
(1,278)
|
|
|
$
|
1,101
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended
September 30, 2013
|
|
Nine Months Ended
September 30, 2012
|
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
Total revenues
(100%)
|
|
$
|
115,367
|
|
|
$
|
69,498
|
|
|
$
|
184,865
|
|
|
$
|
110,332
|
|
|
$
|
56,735
|
|
|
$
|
167,067
|
|
Property EBITDA
(100%)
|
|
$
|
38,487
|
|
|
$
|
14,772
|
|
|
$
|
53,259
|
|
|
$
|
33,522
|
|
|
$
|
9,743
|
|
|
$
|
43,265
|
|
Equity in earnings
(losses) of unconsolidated affiliates (SHR ownership)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property
EBITDA
|
|
$
|
13,999
|
|
|
$
|
7,386
|
|
|
$
|
21,385
|
|
|
$
|
11,498
|
|
|
$
|
4,871
|
|
|
$
|
16,369
|
|
Depreciation and
amortization
|
|
(5,647)
|
|
|
(5,005)
|
|
|
(10,652)
|
|
|
(5,098)
|
|
|
(5,321)
|
|
|
(10,419)
|
|
Interest
expense
|
|
(6,384)
|
|
|
(585)
|
|
|
(6,969)
|
|
|
(7,544)
|
|
|
(589)
|
|
|
(8,133)
|
|
Other expenses,
net
|
|
(228)
|
|
|
(35)
|
|
|
(263)
|
|
|
(62)
|
|
|
(44)
|
|
|
(106)
|
|
Income
taxes
|
|
(276)
|
|
|
—
|
|
|
(276)
|
|
|
293
|
|
|
—
|
|
|
293
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
1,464
|
|
|
$
|
1,761
|
|
|
$
|
3,225
|
|
|
$
|
(913)
|
|
|
$
|
(1,083)
|
|
|
$
|
(1,996)
|
|
EBITDA
Contribution
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
1,464
|
|
|
$
|
1,761
|
|
|
$
|
3,225
|
|
|
$
|
(913)
|
|
|
$
|
(1,083)
|
|
|
$
|
(1,996)
|
|
Depreciation and
amortization
|
|
5,647
|
|
|
5,005
|
|
|
10,652
|
|
|
5,098
|
|
|
5,321
|
|
|
10,419
|
|
Interest
expense
|
|
6,384
|
|
|
585
|
|
|
6,969
|
|
|
7,544
|
|
|
589
|
|
|
8,133
|
|
Income
taxes
|
|
276
|
|
|
—
|
|
|
276
|
|
|
(293)
|
|
|
—
|
|
|
(293)
|
|
EBITDA
Contribution
|
|
$
|
13,771
|
|
|
$
|
7,351
|
|
|
$
|
21,122
|
|
|
$
|
11,436
|
|
|
$
|
4,827
|
|
|
$
|
16,263
|
|
FFO
Contribution
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
1,464
|
|
|
$
|
1,761
|
|
|
$
|
3,225
|
|
|
$
|
(913)
|
|
|
$
|
(1,083)
|
|
|
$
|
(1,996)
|
|
Depreciation and
amortization
|
|
5,647
|
|
|
5,005
|
|
|
10,652
|
|
|
5,098
|
|
|
5,321
|
|
|
10,419
|
|
FFO
Contribution
|
|
$
|
7,111
|
|
|
$
|
6,766
|
|
|
$
|
13,877
|
|
|
$
|
4,185
|
|
|
$
|
4,238
|
|
|
$
|
8,423
|
|
|
|
Investments in
Unconsolidated Affiliates (Continued)
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Debt
|
|
Interest Rate
|
|
|
|
Spread over
LIBOR
|
|
|
|
Loan Amount
|
|
Maturity (a)
|
Hotel del
Coronado
|
|
|
|
|
|
|
|
|
|
|
|
|
CMBS Mortgage and
Mezzanine
|
|
3.83
|
%
|
|
|
|
365 bp
|
|
|
|
$
|
475,000
|
|
|
March 2018
|
Cash and cash
equivalents
|
|
|
|
|
|
|
|
|
|
(8,870)
|
|
|
|
Net Debt
|
|
|
|
|
|
|
|
|
|
$
|
466,130
|
|
|
|
Fairmont
Scottsdale Princess
|
|
|
|
|
|
|
|
|
|
|
|
|
CMBS
Mortgage
|
|
0.54
|
%
|
|
|
|
36 bp
|
|
|
|
$
|
133,000
|
|
|
April 2015
|
Cash and cash
equivalents
|
|
|
|
|
|
|
|
|
|
(3,937)
|
|
|
|
Net Debt
|
|
|
|
|
|
|
|
|
|
$
|
129,063
|
|
|
|
|
(a) Includes extension options.
|
Caps
|
|
Effective
Date
|
|
LIBOR Cap Rate
|
|
Notional Amount
|
|
Maturity
|
Hotel del
Coronado
|
|
|
|
|
|
|
|
|
CMBS Mortgage and
Mezzanine Loan Caps
|
|
March 2013
|
|
3.00
|
%
|
|
$
|
475,000
|
|
|
March 2015
|
Fairmont
Scottsdale Princess
|
|
|
|
|
|
|
|
|
CMBS Mortgage Loan
Cap
|
|
June 2011
|
|
4.00
|
%
|
|
$
|
133,000
|
|
|
December 2013
|
|
|
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Leasehold
Information
(in
thousands)
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Marriott
Hamburg:
|
|
|
|
|
|
|
|
|
Property
EBITDA
|
|
$
|
1,655
|
|
|
$
|
1,508
|
|
|
$
|
4,557
|
|
|
$
|
4,404
|
|
Revenue
(a)
|
|
$
|
1,416
|
|
|
$
|
1,175
|
|
|
$
|
3,776
|
|
|
$
|
3,505
|
|
|
|
|
|
|
|
|
|
|
Lease
expense
|
|
(1,202)
|
|
|
(1,114)
|
|
|
(3,584)
|
|
|
(3,425)
|
|
Less: Deferred gain
on sale-leaseback
|
|
(52)
|
|
|
(49)
|
|
|
(154)
|
|
|
(150)
|
|
Adjusted lease
expense
|
|
(1,254)
|
|
|
(1,163)
|
|
|
(3,738)
|
|
|
(3,575)
|
|
|
|
|
|
|
|
|
|
|
EBITDA contribution
from leasehold
|
|
$
|
162
|
|
|
$
|
12
|
|
|
$
|
38
|
|
|
$
|
(70)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Security Deposit
(b):
|
|
September 30,
2013
|
|
December 31,
2012
|
Marriott
Hamburg
|
|
$
|
2,570
|
|
|
$
|
2,507
|
|
|
|
|
|
|
|
|
|
|
|
(a) For
the three and nine months ended September 30, 2013 and 2012,
Revenue for the Marriott Hamburg hotel represents lease
revenue.
|
|
(b) The
security deposit is recorded in prepaid expenses and other assets
on the consolidated balance sheets.
|
Strategic Hotels & Resorts, Inc. and Subsidiaries
(SHR)
Non-GAAP Financial Measures
We present five non-GAAP financial measures that we believe are
useful to management and investors as key measures of our operating
performance: Funds from Operations (FFO); FFO—Fully Diluted;
Comparable FFO; Earnings Before Interest Expense, Taxes,
Depreciation and Amortization (EBITDA); and Comparable EBITDA.
EBITDA represents net income (or loss) attributable to SHR
common shareholders excluding: (i) interest expense,
(ii) income taxes, including deferred income tax benefits and
expenses applicable to our foreign subsidiaries and income taxes
applicable to sale of assets; (iii) depreciation and
amortization; and (iv) preferred stock dividends. EBITDA also
excludes interest expense, income taxes and depreciation and
amortization of our unconsolidated affiliates. EBITDA is presented
on a full participation basis, which means we have assumed
conversion of all redeemable noncontrolling interests of our
operating partnership into our common stock. We believe this
treatment of noncontrolling interests provides useful information
for management and our investors and appropriately considers our
current capital structure. We also present Comparable EBITDA, which
eliminates the effect of realizing deferred gains on our sale
leasebacks, as well as the effect of gains or losses on sales of
assets, early extinguishment of debt, impairment losses, foreign
currency exchange gains or losses and certain other charges that
are highly variable from year to year. We believe EBITDA and
Comparable EBITDA are useful to management and investors in
evaluating our operating performance because they provide
management and 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 management and
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 Comparable
EBITDA as measures in determining the value of acquisitions and
dispositions.
We compute FFO in accordance with standards established by the
National Association of Real Estate Investment Trusts, or NAREIT,
with the exception of impairment of depreciable real estate. NAREIT
adopted a definition of FFO in order to promote an industry-wide
standard measure of REIT operating performance. NAREIT defines FFO
as net income (or loss) (computed in accordance with GAAP)
excluding losses or gains from sales of depreciable property,
impairment of depreciable real estate, real estate-related
depreciation and amortization, and our portion of these items
related to unconsolidated affiliates. We also present FFO—Fully
Diluted, which is FFO plus income or loss on income attributable to
redeemable noncontrolling interests in our operating partnership.
We also present Comparable FFO, which is FFO—Fully Diluted
excluding the impact of any gains or losses on early extinguishment
of debt, impairment losses, foreign currency exchange gains or
losses and certain other charges that are highly variable from year
to year. We believe that the presentation of FFO, FFO—Fully Diluted
and Comparable FFO provides useful information to management and
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. We also present Comparable
FFO per diluted share as a non-GAAP measure of our performance. We
calculate Comparable FFO per diluted share for a given operating
period as our Comparable FFO (as defined above) divided by the
weighted average of fully diluted shares outstanding, excluding
shares related to the JW Marriott Essex House Hotel put option.
Dilutive securities may include shares granted under share-based
compensation plans and operating partnership units. No effect is
shown for securities that are anti-dilutive.
We caution investors that amounts presented in accordance with
our definitions of FFO, FFO—Fully Diluted, Comparable FFO, EBITDA,
and Comparable 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, FFO—Fully Diluted,
Comparable FFO, EBITDA, and Comparable EBITDA should not be
considered as an alternative measure of our net income (or loss) or
operating performance. FFO, FFO—Fully Diluted, Comparable FFO,
EBITDA, and Comparable 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, FFO—Fully Diluted, Comparable FFO, EBITDA, and
Comparable 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 (or loss) attributable to SHR common shareholders. In
addition, you should be aware that adverse economic and market
conditions might negatively impact our cash flow. We have provided
a quantitative reconciliation of FFO, FFO—Fully Diluted, Comparable
FFO, EBITDA, and Comparable EBITDA to the most directly comparable
GAAP financial performance measure, which is net income (or loss)
attributable to SHR common shareholders.
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Reconciliation of
Net Income (Loss) Attributable to SHR Common Shareholders to EBITDA
and Comparable EBITDA
(in
thousands)
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
3,760
|
|
|
$
|
(8,557)
|
|
|
$
|
(16,414)
|
|
|
$
|
(43,071)
|
|
Depreciation and
amortization
|
|
26,244
|
|
|
25,649
|
|
|
80,459
|
|
|
76,416
|
|
Interest
expense
|
|
21,106
|
|
|
19,942
|
|
|
63,871
|
|
|
58,627
|
|
Income
taxes
|
|
(430)
|
|
|
(600)
|
|
|
1,121
|
|
|
215
|
|
Noncontrolling
interests
|
|
29
|
|
|
(17)
|
|
|
(22)
|
|
|
(126)
|
|
Adjustments from
consolidated affiliates
|
|
(3,912)
|
|
|
(1,879)
|
|
|
(11,015)
|
|
|
(4,382)
|
|
Adjustments from
unconsolidated affiliates
|
|
5,903
|
|
|
7,036
|
|
|
17,936
|
|
|
20,606
|
|
Preferred shareholder
dividends
|
|
6,042
|
|
|
6,042
|
|
|
18,125
|
|
|
18,125
|
|
EBITDA
|
|
58,742
|
|
|
47,616
|
|
|
154,061
|
|
|
126,410
|
|
Realized portion of
deferred gain on sale-leaseback
|
|
(52)
|
|
|
(49)
|
|
|
(154)
|
|
|
(150)
|
|
Loss on sale of
assets—continuing operations
|
|
1,028
|
|
|
—
|
|
|
755
|
|
|
—
|
|
Loss on sale of
assets—adjustments from consolidated affiliates
|
|
(370)
|
|
|
—
|
|
|
(370)
|
|
|
—
|
|
Impairment losses and
other charges
|
|
728
|
|
|
—
|
|
|
728
|
|
|
—
|
|
Foreign currency
exchange loss (gain)—continuing operations (a)
|
|
9
|
|
|
996
|
|
|
(177)
|
|
|
1,169
|
|
Foreign currency
exchange loss—discontinued operations (a)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
535
|
|
Adjustment for Value
Creation Plan
|
|
—
|
|
|
(2,013)
|
|
|
—
|
|
|
2,759
|
|
Comparable
EBITDA
|
|
$
|
60,085
|
|
|
$
|
46,550
|
|
|
$
|
154,843
|
|
|
$
|
130,723
|
|
|
(a) Foreign
currency exchange gains or losses applicable to third-party and
inter-company debt and certain balance sheet items held by foreign
subsidiaries.
|
|
|
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Reconciliation of
Net Income (Loss) Attributable to SHR Common Shareholders
to
Funds From
Operations (FFO), FFO—Fully Diluted and Comparable
FFO
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
3,760
|
|
|
$
|
(8,557)
|
|
|
$
|
(16,414)
|
|
|
$
|
(43,071)
|
|
Depreciation and
amortization
|
|
26,244
|
|
|
25,649
|
|
|
80,459
|
|
|
76,416
|
|
Corporate
depreciation
|
|
(125)
|
|
|
(260)
|
|
|
(383)
|
|
|
(789)
|
|
Loss on sale of
assets—continuing operations
|
|
1,028
|
|
|
—
|
|
|
755
|
|
|
—
|
|
Realized portion of
deferred gain on sale-leaseback
|
|
(52)
|
|
|
(49)
|
|
|
(154)
|
|
|
(150)
|
|
Noncontrolling
interests adjustments
|
|
(25)
|
|
|
(121)
|
|
|
(277)
|
|
|
(374)
|
|
Adjustments from
consolidated affiliates
|
|
(2,269)
|
|
|
(859)
|
|
|
(5,565)
|
|
|
(2,185)
|
|
Adjustments from
unconsolidated affiliates
|
|
3,429
|
|
|
3,792
|
|
|
10,653
|
|
|
11,335
|
|
FFO
|
|
31,990
|
|
|
19,595
|
|
|
69,074
|
|
|
41,182
|
|
Redeemable
noncontrolling interests
|
|
53
|
|
|
104
|
|
|
255
|
|
|
248
|
|
FFO—Fully
Diluted
|
|
32,043
|
|
|
19,699
|
|
|
69,329
|
|
|
41,430
|
|
Impairment losses and
other charges
|
|
728
|
|
|
—
|
|
|
728
|
|
|
—
|
|
Non-cash mark to
market of interest rate swaps
|
|
(2,977)
|
|
|
(1,688)
|
|
|
(9,121)
|
|
|
(4,405)
|
|
Foreign currency
exchange loss (gain)—continuing operations (a)
|
|
9
|
|
|
996
|
|
|
(177)
|
|
|
1,169
|
|
Foreign currency
exchange loss—discontinued operations (a)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
535
|
|
Adjustment for Value
Creation Plan
|
|
—
|
|
|
(2,013)
|
|
|
—
|
|
|
2,759
|
|
Comparable
FFO
|
|
$
|
29,803
|
|
|
$
|
16,994
|
|
|
$
|
60,759
|
|
|
$
|
41,488
|
|
Comparable FFO per
fully diluted share
|
|
$
|
0.14
|
|
|
$
|
0.08
|
|
|
$
|
0.29
|
|
|
$
|
0.21
|
|
Weighted average
diluted shares (b)
|
|
209,722
|
|
|
208,696
|
|
|
209,125
|
|
|
201,050
|
|
|
(a) Foreign
currency exchange gains or losses applicable to third-party and
inter-company debt and certain balance sheet items held by foreign
subsidiaries.
|
|
(b) Excludes
shares related to the JW Marriott Essex House Hotel put
option.
|
|
|
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Debt
Summary
(dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
Debt
|
|
Interest Rate
|
|
Spread (a)
|
|
Loan Amount
|
|
Maturity
(b)
|
North Beach
Venture
|
|
5.00
|
%
|
|
Fixed
|
|
$
|
1,476
|
|
|
January 2014
|
Marriott London
Grosvenor Square (c)
|
|
3.12
|
%
|
|
260 bp (c)
|
|
113,367
|
|
|
October 2014
|
Bank credit
facility
|
|
3.18
|
%
|
|
300 bp
|
|
137,000
|
|
|
June 2015
|
Four Seasons
Washington, D.C.
|
|
3.33
|
%
|
|
315 bp
|
|
130,000
|
|
|
July 2016
|
Westin St.
Francis
|
|
6.09
|
%
|
|
Fixed
|
|
209,588
|
|
|
June 2017
|
Fairmont
Chicago
|
|
6.09
|
%
|
|
Fixed
|
|
93,124
|
|
|
June 2017
|
JW Marriott Essex
House Hotel
|
|
4.75
|
%
|
|
400 bp
|
|
186,278
|
|
|
September
2017
|
Hyatt Regency La
Jolla (d)
|
|
4.50% /
10.00
|
%
|
|
400 bp /
Fixed
|
|
89,367
|
|
|
December
2017
|
InterContinental
Miami
|
|
3.68
|
%
|
|
350 bp
|
|
85,000
|
|
|
July 2018
|
Loews Santa Monica
Beach Hotel
|
|
4.03
|
%
|
|
385 bp
|
|
109,500
|
|
|
July 2018
|
InterContinental
Chicago
|
|
5.61
|
%
|
|
Fixed
|
|
144,867
|
|
|
August 2021
|
|
|
|
|
|
|
$
|
1,299,567
|
|
|
|
|
(a)
|
Spread over LIBOR
(0.18% at September 30, 2013). Interest on the JW Marriott
Essex House Hotel loan is subject to a 0.75% LIBOR floor.
Interest on the Hyatt Regency La Jolla loan is subject to a 0.50%
LIBOR floor.
|
|
(b)
|
Includes extension
options.
|
|
(c)
|
Principal balance of
£70,040,000 at September 30, 2013. On August 7, 2013, the
Company entered into an amendment to the mortgage loan. The
amendment extended the maturity of the loan to October 2014 and
waived the July 2013 and subsequent principal payments through the
extended term. Pursuant to the amendment, the spread over GBP LIBOR
increases in steps during the extension period from GBP LIBOR plus
2.10% in August 2013 to GBP LIBOR plus 4.25% in April 2014. The
spread in the table is the spread as of September 30,
2013.
|
|
(d)
|
Interest on
$72,000,000 is payable at LIBOR plus 4.00%, subject to a 0.50%
LIBOR floor, and interest on $17,367,000 is payable at a fixed rate
of 10.00%.
|
|
|
|
Domestic and
European Interest Rate Swaps
|
|
|
|
|
|
|
|
Swap Effective
Date
|
|
Fixed Pay Rate
Against LIBOR
|
|
Notional
Amount
|
|
Maturity
|
February
2010
|
|
4.90
|
%
|
|
$
|
100,000
|
|
|
September 2014
|
February
2010
|
|
4.96
|
%
|
|
100,000
|
|
|
December 2014
|
December
2010
|
|
5.23
|
%
|
|
100,000
|
|
|
December 2015
|
February
2011
|
|
5.27
|
%
|
|
100,000
|
|
|
February 2016
|
|
|
5.09
|
%
|
|
$
|
400,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Swap Effective
Date
|
|
Fixed Pay
Rate
Against GBP
LIBOR
|
|
Notional
Amount
|
|
|
Maturity
|
October
2007
|
|
5.72
|
%
|
|
|
|
£
|
69,010
|
|
|
October
2013
|
|
|
|
|
|
|
|
|
|
|
|
|
Future scheduled debt principal payments (including
extension options) are as follows
|
|
|
|
|
Years ending December 31,
|
|
Amount
|
2013
|
|
$
|
948
|
2014
|
|
|
119,098
|
2015
|
|
|
143,029
|
2016
|
|
|
139,783
|
2017
|
|
|
577,550
|
Thereafter
|
|
|
319,159
|
|
|
$
|
1,299,567
|
|
|
|
|
Percent of fixed rate debt including U.S. and
European swaps
|
|
|
75.3%
|
Weighted average interest rate including U.S. and
European swaps (e)
|
|
|
6.60%
|
Weighted average maturity of fixed rate debt (debt
with maturity of greater than one year)
|
|
|
3.79
|
|
(e) Excludes
the amortization of deferred financing costs and the amortization
of the interest rate swap costs.
|
SOURCE Strategic Hotels & Resorts, Inc.