CHICAGO, Nov. 3, 2014 /PRNewswire/ -- Strategic
Hotels & Resorts, Inc. (NYSE: BEE) today reported results for
the third quarter ended September 30,
2014.
($ in millions,
except per share and operating metrics)
|
Third
Quarter
|
Earnings
Metrics
|
2014
|
2013
|
%
Change
|
Net income
attributable to common shareholders
|
$21.0
|
$3.8
|
458.2%
|
Net income per
diluted share
|
$0.07
|
$0.00
|
N/A
|
Comparable funds from
operations (Comparable FFO) (a)
|
$56.7
|
$29.8
|
90.2%
|
Comparable FFO per
diluted share (a)
|
$0.23
|
$0.14
|
64.3%
|
Comparable EBITDA
(a)
|
$75.2
|
$60.1
|
25.1%
|
|
|
|
|
Total United
States Portfolio Operating Metrics (b)
|
|
|
|
Average Daily Rate
(ADR)
|
$314.53
|
$296.68
|
6.0%
|
Occupancy
|
80.2%
|
80.0%
|
0.2 pts
|
Revenue per Available
Room (RevPAR)
|
$252.30
|
$237.23
|
6.4%
|
Total
RevPAR
|
$435.30
|
$406.77
|
7.0%
|
EBITDA
Margins
|
27.0%
|
26.4%
|
60 bps
|
|
|
(a)
|
Please refer to
the tables provided later in this press release for a
reconciliation of net income attributable to common shareholders to
Comparable FFO, Comparable FFO per share and Comparable
EBITDA. Comparable FFO, Comparable FFO per share and
Comparable EBITDA are non-GAAP measures and are further explained
with the reconciliation tables.
|
|
|
(b)
|
Operating
statistics reflect results from the Company's Total United States
portfolio which is derived from the Company's hotel portfolio at
September 30, 2014, consisting of all 15 properties located in the
United States.
|
($ in millions,
except per share and operating metrics)
|
Year-to-Date
|
Earnings
Metrics
|
2014
|
2013
|
%
Change
|
Net income
attributable to common shareholders
|
$319.0
|
$(16.4)
|
N/A
|
Net income per
diluted share
|
$1.32
|
$(0.11)
|
N/A
|
Comparable funds from
operations (Comparable FFO) (a)
|
$117.0
|
$60.8
|
92.6%
|
Comparable FFO per
diluted share (a)
|
$0.51
|
$0.29
|
75.9%
|
Comparable EBITDA
(a)
|
$185.3
|
$154.8
|
19.6%
|
|
|
|
|
Total United
States Portfolio Operating Metrics (b)
|
|
|
|
Average Daily Rate
(ADR)
|
$299.25
|
$283.96
|
5.4%
|
Occupancy
|
76.3%
|
75.8%
|
0.5 pts
|
Revenue per Available
Room (RevPAR)
|
$228.19
|
$215.30
|
6.0%
|
Total
RevPAR
|
$422.50
|
$392.12
|
7.7%
|
EBITDA
Margins
|
25.3%
|
23.9%
|
140 bps
|
|
|
(c)
|
Please refer to
the tables provided later in this press release for a
reconciliation of net income attributable to common shareholders 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.
|
|
|
(d)
|
Operating
statistics reflect results from the Company's Total United States
portfolio which is derived from the Company's hotel portfolio at
September 30, 2014, consisting of all 15 properties located in the
United States.
|
|
|
"Consistent with our focused strategy, we are pleased with our
excellent financial results in the quarter including a 25% increase
in Comparable EBITDA and a 64% increase in Comparable FFO per
share," stated Raymond L. Gellein,
Chairman and CEO of Strategic Hotels & Resorts. "We
continue to experience strong group demand and ancillary spend in
our portfolio, leading to a 7% increase in Total RevPAR in the
quarter and a 7.7% increase year to date. We are committed to
capitalizing on our significant embedded growth and enhancing our
portfolio through potential acquisitions of strategically and
financially attractive investment opportunities. Given the
tremendous improvements we have made to our balance sheet, we are
well positioned to continue to enhance shareholder value through
the execution of our operating and growth strategy as we look ahead
to 2015," concluded Gellein.
Third Quarter Highlights
- Total consolidated revenues were $305.3
million in the third quarter of 2014, a 36.5 percent
increase over the prior year period.
- Net income attributable to common shareholders was $21.0 million, or $0.07 per diluted share, in the third quarter of
2014, compared with $3.8 million, or
$0.00 per diluted share, in the third
quarter of 2013.
- Comparable FFO was $0.23 per
diluted share in the third quarter of 2014, compared with
$0.14 per diluted share in the prior
year period, a 64.3 percent increase over the prior year
period.
- Comparable EBITDA was $75.2 million in the third quarter of 2014,
compared with $60.1 million in the
prior year period, a 25.1 percent increase between periods.
- Total United States portfolio
RevPAR increased 6.4 percent in the third quarter of 2014, driven
by a 6.0 percent increase in ADR and a 0.2 percentage point
increase in occupancy compared to the third quarter of 2013.
Total RevPAR increased 7.0 percent between periods with non-rooms
revenue increasing by 8.0 percent between periods.
- Group occupied room nights in the Total United States portfolio
increased 14.9 percent in the third quarter of 2014 offsetting a
7.2 percent decline in transient occupied room nights compared to
the third quarter of 2013. Transient ADR increased 8.8
percent compared to the third quarter of 2013 and group ADR
increased 5.6 percent.
- Total United States portfolio
EBITDA margins expanded 60 basis points in the third quarter of
2014, compared to the third quarter of 2013. Adjusted for
certain one-time items impacting the third quarter of 2013 and
2014, EBITDA margins expanded 70 basis points.
- Group room nights currently booked for 2014 are 6.2 percent
higher compared to room nights booked for 2013 at the same time
last year, with rates 3.6 percent higher, resulting in a 10.0
percent RevPAR increase.
The Company reported financial results for the nine month period
ended September 30, 2014 as
follows:
- Total consolidated revenues were $776.1
million for the nine month period ended September 30, 2014, a 22.8 percent increase over
the prior year period.
- Net income attributable to common shareholders was $319.0 million, or $1.32 per diluted share, compared with net loss
attributable to common shareholders of $16.4
million, or $0.11 per diluted
share, for the nine month period ended September 30, 2013. Results for the nine
month period ending September 30,
2014 include gains on sales of assets totaling $156.5 million and gains on the consolidation of
affiliates totaling $143.5
million. These one-time items have been excluded from
Comparable EBITDA, Comparable FFO and Comparable FFO per diluted
share.
- Comparable FFO was $0.51 per
diluted share compared with $0.29 per
diluted share in the nine month period ended September 30, 2013, a 75.9 percent increase
between periods.
- Comparable EBITDA was $185.3 million compared with $154.8 million for the nine month period ended
September 30, 2013, a 19.6 percent
increase between periods.
Preferred Dividends
On August 28, 2014, the Company's
board of directors declared a quarterly dividend of $0.51563 per share of 8.25% Series B Cumulative
Redeemable Preferred Stock, which was paid on September 30, 2014 to shareholders of record as
of the close of business on September 15,
2014.
Transaction Activity
On August 29, 2014, the Company
closed on a $115.0 million loan
secured by the InterContinental Miami hotel. The loan bears
interest at a fixed rate of 3.99 percent and matures in 2024.
Subsequent Events
On October 10, 2014 the Company
entered into an amendment to the employment agreement with its
President and Chief Executive Officer, Raymond L. Gellein. The term of the
employment agreement was extended until December 31, 2015.
2014 Guidance
Based on the results of the first nine months of 2014 and
current forecasts for the remainder of the year, management is
updating its guidance ranges for full year 2014 as
follows:
For the full-year ending December 31,
2014, the Company is providing the following guidance
ranges:
Guidance
Metrics
|
Previous
Range
|
|
Revised
Range
|
RevPAR
|
5.5% -
7.0%
|
|
5.5% -
7.0%
|
Total
RevPAR
|
5.5% -
7.0%
|
|
6.0% -
7.0%
|
EBITDA Margin
expansion
|
150 – 200 basis
points
|
|
150 – 200 basis
points
|
Comparable
EBITDA
|
$235M -
$250M
|
|
$240M -
$250M
|
Comparable FFO per
diluted share
|
$0.62 -
$0.68
|
|
$0.65 -
$0.69
|
Earnings Call
The Company will conduct its third quarter 2014 conference call
for investors and other interested parties on Monday, November 3, 2014 at 11:00 a.m. Eastern Time (ET). Interested
individuals are invited to access the call by dialing 866.953.6860
(toll international: 617.399.3484) with passcode 37266467. To
participate on the webcast, log on to the company's website at
http://www.strategichotels.com or
http://edge.media-server.com/m/p/peuzy77q/lan/en 15 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 3:00 p.m.
ET on November 3, 2014 through
11:59 p.m. ET on November 10, 2014. To access the replay, dial
888.286.8010 (toll international: 617.801.6888) with passcode
16606548. A replay of the call will also be available on the
Internet at http://www.strategichotels.com or
http://www.earnings.com for 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.
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 and Europe. The Company currently has ownership
interests in 16 properties with an aggregate of 7,865 rooms and
835,000 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, 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: the effects of economic conditions and disruption
in financial markets 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; the Company's ability to maintain compliance
with covenants contained in its debt facilities; stagnation or
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, Germany 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; 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 SEC, 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 2014 net income
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 Income
Attributable to Common Shareholders
|
$315.6
|
|
$325.6
|
Depreciation and
Amortization
|
121.5
|
|
121.5
|
Interest
Expense
|
83.8
|
|
83.8
|
Income
Taxes
|
1.9
|
|
1.9
|
Non-controlling
Interests
|
1.2
|
|
1.2
|
Adjustments from
Consolidated Affiliates
|
(16.0)
|
|
(16.0)
|
Adjustments from
Unconsolidated Affiliates
|
8.4
|
|
8.4
|
Preferred Shareholder
Dividends
|
13.7
|
|
13.7
|
Preferred Stock
Redemption Liability
|
6.9
|
|
6.9
|
Realized Portion of
Deferred Gain on Sale Leasebacks
|
(0.2)
|
|
(0.2)
|
Gain on Sale of
Asset
|
(157.2)
|
|
(157.2)
|
Gain on Consolidation
of Affiliate
|
(143.5)
|
|
(143.5)
|
Other
Adjustments
|
3.9
|
|
3.9
|
Comparable
EBITDA
|
$240.0
|
|
$250.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Low
Range
|
|
High
Range
|
Net Income
Attributable to Common Shareholders
|
$315.6
|
|
$325.6
|
Depreciation and
Amortization
|
120.8
|
|
120.8
|
Realized Portion of
Deferred Gain on Sale Leasebacks
|
(0.2)
|
|
(0.2)
|
Gain on Sale of
Asset
|
(157.2)
|
|
(157.2)
|
Gain on Consolidation
of Affiliate
|
(143.5)
|
|
(143.5)
|
Non-controlling
Interests
|
1.2
|
|
1.2
|
Adjustments from
Consolidated Affiliates
|
(8.5)
|
|
(8.5)
|
Adjustments from
Unconsolidated Affiliates
|
5.1
|
|
5.1
|
Interest Rate Swap
OCI Amortization
|
8.9
|
|
8.9
|
Preferred Stock
Redemption Liability
|
6.9
|
|
6.9
|
Other
Adjustments
|
2.9
|
|
2.9
|
Comparable
FFO
|
152.0
|
|
162.0
|
Comparable FFO per
Diluted Share
|
$0.65
|
|
$0.69
|
|
|
|
|
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,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Revenues:
|
|
|
|
|
|
|
|
|
Rooms
|
|
$
|
176,133
|
|
$
|
134,092
|
|
$
|
428,107
|
|
$
|
359,840
|
Food and
beverage
|
|
96,642
|
|
67,101
|
|
266,687
|
|
209,124
|
Other hotel operating
revenue
|
|
31,224
|
|
21,098
|
|
77,405
|
|
59,248
|
Lease
revenue
|
|
1,264
|
|
1,416
|
|
3,882
|
|
3,776
|
Total
revenues
|
|
305,263
|
|
223,707
|
|
776,081
|
|
631,988
|
Operating Costs
and Expenses:
|
|
|
|
|
|
|
|
|
Rooms
|
|
48,197
|
|
36,441
|
|
123,172
|
|
104,291
|
Food and
beverage
|
|
70,965
|
|
54,408
|
|
192,645
|
|
163,247
|
Other departmental
expenses
|
|
74,640
|
|
54,825
|
|
194,457
|
|
159,291
|
Management
fees
|
|
9,970
|
|
6,376
|
|
24,989
|
|
17,833
|
Other hotel
expenses
|
|
17,998
|
|
13,685
|
|
49,248
|
|
43,808
|
Lease
expense
|
|
1,215
|
|
1,202
|
|
3,733
|
|
3,584
|
Depreciation and
amortization
|
|
32,932
|
|
23,906
|
|
83,195
|
|
73,505
|
Impairment losses and
other charges
|
|
—
|
|
728
|
|
—
|
|
728
|
Corporate
expenses
|
|
5,405
|
|
5,191
|
|
19,796
|
|
18,163
|
Total operating costs
and expenses
|
|
261,322
|
|
196,762
|
|
691,235
|
|
584,450
|
Operating
income
|
|
43,941
|
|
26,945
|
|
84,846
|
|
47,538
|
Interest
expense
|
|
(21,844)
|
|
(19,227)
|
|
(59,705)
|
|
(58,350)
|
Interest
income
|
|
46
|
|
11
|
|
123
|
|
41
|
Loss on early
extinguishment of debt
|
|
(609)
|
|
—
|
|
(609)
|
|
—
|
Equity in (losses)
earnings of unconsolidated affiliates
|
|
(4)
|
|
451
|
|
5,267
|
|
3,252
|
Foreign currency
exchange (loss) gain
|
|
(69)
|
|
28
|
|
(75)
|
|
26
|
(Loss) gain on
consolidation of affiliates
|
|
(15)
|
|
—
|
|
143,451
|
|
—
|
Other (expenses)
income, net
|
|
(136)
|
|
(832)
|
|
1,082
|
|
45
|
Income (loss) before
income taxes and discontinued operations
|
|
21,310
|
|
7,376
|
|
174,380
|
|
(7,448)
|
Income tax (expense)
benefit
|
|
(370)
|
|
15
|
|
(616)
|
|
(70)
|
Income (loss) from
continuing operations
|
|
20,940
|
|
7,391
|
|
173,764
|
|
(7,518)
|
Income (loss) from
discontinued operations, net of tax
|
|
63
|
|
(578)
|
|
159,102
|
|
1,740
|
Net Income
(Loss)
|
|
21,003
|
|
6,813
|
|
332,866
|
|
(5,778)
|
Net (income) loss
attributable to the noncontrolling interests in SHR's operating
partnership
|
|
(67)
|
|
(29)
|
|
(1,197)
|
|
22
|
Net loss attributable
to the noncontrolling interests in consolidated
affiliates
|
|
1,854
|
|
3,018
|
|
6,112
|
|
7,467
|
Net Income
Attributable to SHR
|
|
22,790
|
|
9,802
|
|
337,781
|
|
1,711
|
Preferred shareholder
dividends
|
|
(1,802)
|
|
(6,042)
|
|
(18,795)
|
|
(18,125)
|
Net Income (Loss)
Attributable to SHR Common Shareholders
|
|
$
|
20,988
|
|
$
|
3,760
|
|
$
|
318,986
|
|
$
|
(16,414)
|
Basic Income
(Loss) Per Common Share:
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to SHR common
shareholders
|
|
$
|
0.08
|
|
$
|
0.02
|
|
$
|
0.71
|
|
$
|
(0.09)
|
Income from
discontinued operations attributable to SHR common
shareholders
|
|
—
|
|
—
|
|
0.70
|
|
0.01
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
0.08
|
|
$
|
0.02
|
|
$
|
1.41
|
|
$
|
(0.08)
|
Weighted average
shares of common stock outstanding
|
|
248,509
|
|
206,767
|
|
225,932
|
|
206,163
|
Diluted Income
(Loss) Per Common Share:
|
|
|
|
|
|
|
|
|
Income (loss) from
continuing operations attributable to SHR common
shareholders
|
|
$
|
0.07
|
|
$
|
—
|
|
$
|
0.65
|
|
$
|
(0.12)
|
Income from
discontinued operations attributable to SHR common
shareholders
|
|
—
|
|
—
|
|
0.67
|
|
0.01
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
0.07
|
|
$
|
—
|
|
$
|
1.32
|
|
$
|
(0.11)
|
Weighted average
shares of common stock outstanding
|
|
260,257
|
|
220,258
|
|
237,680
|
|
217,553
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Consolidated
Balance Sheets
(in thousands,
except share data)
|
|
|
|
September 30,
2014
|
|
December 31,
2013
|
Assets
|
|
|
|
|
Investment in hotel
properties, net
|
|
$
|
2,709,550
|
|
$
|
1,795,338
|
Goodwill
|
|
38,128
|
|
38,128
|
Intangible assets,
net of accumulated amortization of $5,463 and $11,753
|
|
89,888
|
|
29,502
|
Assets held for
sale
|
|
—
|
|
135,901
|
Investment in
unconsolidated affiliates
|
|
22,909
|
|
104,973
|
Cash and cash
equivalents
|
|
234,405
|
|
73,655
|
Restricted cash and
cash equivalents
|
|
100,182
|
|
75,916
|
Accounts receivable,
net of allowance for doubtful accounts of $443 and $606
|
|
58,003
|
|
39,660
|
Deferred financing
costs, net of accumulated amortization of $10,199 and
$12,354
|
|
9,474
|
|
8,478
|
Deferred tax
assets
|
|
1,763
|
|
—
|
Prepaid expenses and
other assets
|
|
45,612
|
|
35,600
|
Total
assets
|
|
$
|
3,309,914
|
|
$
|
2,337,151
|
Liabilities,
Noncontrolling Interests and Equity
|
|
|
|
|
Liabilities:
|
|
|
|
|
Mortgages and other
debt payable, net of discount
|
|
$
|
1,666,614
|
|
$
|
1,163,696
|
Bank credit
facility
|
|
—
|
|
110,000
|
Liabilities of assets
held for sale
|
|
—
|
|
17,027
|
Accounts payable and
accrued expenses
|
|
214,627
|
|
189,889
|
Deferred tax
liabilities
|
|
45,777
|
|
46,137
|
Total
liabilities
|
|
1,927,018
|
|
1,526,749
|
Commitments and
contingencies
|
|
|
|
|
Noncontrolling
interests in SHR's operating partnership
|
|
9,246
|
|
7,534
|
Equity:
|
|
|
|
|
SHR's shareholders'
equity:
|
|
|
|
|
8.50% Series A
Cumulative Redeemable Preferred Stock ($0.01 par value per share; 0
and 4,148,141 shares issued and outstanding; liquidation preference
$25.00 per share plus accrued distributions and $0 and $103,704 in
the aggregate)
|
|
—
|
|
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; 0
and 3,827,727 shares issued and outstanding; liquidation preference
$25.00 per share plus accrued distributions and $0 and $95,693 in
the aggregate)
|
|
—
|
|
92,489
|
Common stock ($0.01
par value per share; 350,000,000 shares of common stock authorized;
247,382,990 and 205,582,838 shares of common stock issued and
outstanding)
|
|
2,474
|
|
2,056
|
Additional paid-in
capital
|
|
2,105,426
|
|
1,705,306
|
Accumulated
deficit
|
|
(897,171)
|
|
(1,234,952)
|
Accumulated other
comprehensive loss
|
|
(16,102)
|
|
(41,445)
|
Total SHR's
shareholders' equity
|
|
1,281,691
|
|
710,513
|
Noncontrolling
interests in consolidated affiliates
|
|
91,959
|
|
92,355
|
Total
equity
|
|
1,373,650
|
|
802,868
|
Total liabilities,
noncontrolling interests and equity
|
|
$
|
3,309,914
|
|
$
|
2,337,151
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Financial
Highlights
Supplemental
Financial Data
(in thousands,
except per share information)
|
|
|
|
September 30,
2014
|
|
|
Pro Rata Share
|
|
Consolidated
|
Capitalization
|
|
|
|
|
Shares of common
stock outstanding
|
|
247,383
|
|
247,383
|
Operating partnership
units outstanding
|
|
794
|
|
794
|
Restricted stock
units outstanding
|
|
1,470
|
|
1,470
|
Combined shares and
units outstanding
|
|
249,647
|
|
249,647
|
Common stock price at
end of period
|
|
$
|
11.65
|
|
$
|
11.65
|
Common equity
capitalization
|
|
$
|
2,908,388
|
|
$
|
2,908,388
|
Preferred equity
capitalization (at $25.00 face value)
|
|
90,384
|
|
90,384
|
Consolidated
debt
|
|
1,667,860
|
|
1,667,860
|
Pro rata share of
consolidated debt
|
|
(132,561)
|
|
—
|
Cash and cash
equivalents
|
|
(234,405)
|
|
(234,405)
|
Total enterprise
value
|
|
$
|
4,299,666
|
|
$
|
4,432,227
|
Net Debt / Total
Enterprise Value
|
|
30.3%
|
|
32.3%
|
Preferred Equity /
Total Enterprise Value
|
|
2.1%
|
|
2.0%
|
Common Equity / Total
Enterprise Value
|
|
67.6%
|
|
65.7%
|
Strategic
Hotels & Resorts, Inc. and Subsidiaries
(SHR)
|
|
Discontinued
Operations
|
|
The results of
operations of hotels sold are classified as discontinued operations
and segregated in the consolidated statements of operations for all
periods presented. The following hotels were sold during the nine
months ended September 30, 2014:
|
|
Hotel
|
|
Location
|
|
Date Sold
|
|
Sales Proceeds
|
|
Four Seasons Punta
Mita Resort and La Solana land parcel
|
|
Punta Mita,
Mexico
|
|
February 28,
2014
|
|
$
|
206,867,000
|
|
Marriott London
Grosvenor Square
|
|
London,
England
|
|
March 31,
2014
|
|
$
|
209,233,000
|
(a)
|
|
|
(a)
|
There was an
outstanding balance of £67,301,000 ($112,150,000) on the mortgage
loan secured by the Marriott London Grosvenor Square hotel, which
was repaid at the time of closing. The net proceeds we
received were $97,083,000.
|
|
The following is a
summary of income (loss) from discontinued operations for the three
and nine months ended September 30, 2014 and 2013 (in
thousands):
|
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Hotel operating
revenues
|
|
$
|
—
|
|
$
|
13,901
|
|
$
|
17,767
|
|
$
|
51,252
|
Operating costs and
expenses
|
|
—
|
|
10,641
|
|
11,485
|
|
36,141
|
Depreciation and
amortization
|
|
—
|
|
2,338
|
|
1,275
|
|
6,954
|
Total operating costs
and expenses
|
|
—
|
|
12,979
|
|
12,760
|
|
43,095
|
Operating
income
|
|
—
|
|
922
|
|
5,007
|
|
8,157
|
Interest
expense
|
|
—
|
|
(1,879)
|
|
(1,326)
|
|
(5,521)
|
Interest
income
|
|
—
|
|
1
|
|
2
|
|
4
|
Loss on early
extinguishment of debt
|
|
—
|
|
—
|
|
(272)
|
|
—
|
Foreign currency
exchange (loss) gain
|
|
—
|
|
(37)
|
|
32
|
|
151
|
Income tax benefit
(expense)
|
|
—
|
|
415
|
|
(833)
|
|
(1,051)
|
Gain on sale, net of
tax
|
|
63
|
|
—
|
|
156,492
|
|
—
|
Income (loss) from
discontinued operations
|
|
$
|
63
|
|
$
|
(578)
|
|
$
|
159,102
|
|
$
|
1,740
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Investments in
Unconsolidated Affiliates
(in
thousands)
|
|
We had a 36.4% equity ownership interest
in the Hotel del Coronado that we accounted for using the equity
method of accounting until we acquired the remaining 63.6% equity
ownership interest not previously owned by us on June 11, 2014. We
had a 50.0% equity ownership interest in the Fairmont Scottsdale
Princess hotel that we accounted for using the equity method of
accounting until we acquired the remaining 50.0% equity ownership
interest not previously owned by us on March 31, 2014. For purposes
of this analysis, the operating results reflect the 36.4% equity
ownership interest we held in the Hotel del Coronado prior to June
11, 2014 and the 50.0% equity ownership interest we held in the
Fairmont Scottsdale Princess hotel prior to March 31, 2014.
|
|
|
|
Three Months Ended
September 30, 2014
|
|
Three Months Ended
September 30, 2013
|
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
Total revenues
(100%)
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
47,279
|
|
$
|
14,338
|
|
$
|
61,617
|
Property EBITDA
(100%)
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
18,667
|
|
$
|
(302)
|
|
$
|
18,365
|
Equity in earnings
(losses) of unconsolidated affiliates (SHR ownership)
|
|
|
|
|
|
|
|
|
|
|
|
Property
EBITDA
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
6,790
|
|
$
|
(151)
|
|
$
|
6,639
|
Depreciation and
amortization
|
|
—
|
|
—
|
|
—
|
|
(1,896)
|
|
(1,533)
|
|
(3,429)
|
Interest
expense
|
|
—
|
|
—
|
|
—
|
|
(1,950)
|
|
(195)
|
|
(2,145)
|
Other expenses,
net
|
|
—
|
|
—
|
|
—
|
|
(205)
|
|
(16)
|
|
(221)
|
Income
taxes
|
|
—
|
|
—
|
|
—
|
|
(339)
|
|
—
|
|
(339)
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,400
|
|
$
|
(1,895)
|
|
$
|
505
|
EBITDA
Contribution:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,400
|
|
$
|
(1,895)
|
|
$
|
505
|
Depreciation and
amortization
|
|
—
|
|
—
|
|
—
|
|
1,896
|
|
1,533
|
|
3,429
|
Interest
expense
|
|
—
|
|
—
|
|
—
|
|
1,950
|
|
195
|
|
2,145
|
Income
taxes
|
|
—
|
|
—
|
|
—
|
|
339
|
|
—
|
|
339
|
EBITDA
Contribution
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
6,585
|
|
$
|
(167)
|
|
$
|
6,418
|
FFO
Contribution:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings
(losses) of unconsolidated affiliates
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,400
|
|
$
|
(1,895)
|
|
$
|
505
|
Depreciation and
amortization
|
|
—
|
|
—
|
|
—
|
|
1,896
|
|
1,533
|
|
3,429
|
FFO
Contribution
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
4,296
|
|
$
|
(362)
|
|
$
|
3,934
|
|
|
|
|
|
Nine Months Ended
September 30, 2014
|
|
Nine Months Ended
September 30, 2013
|
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
|
Hotel
del
Coronado
|
|
Fairmont
Scottsdale
Princess
|
|
Total
|
Total revenues
(100%)
|
|
$
|
67,863
|
|
$
|
35,006
|
|
$
|
102,869
|
|
$
|
115,367
|
|
$
|
69,498
|
|
$
|
184,865
|
Property EBITDA
(100%)
|
|
$
|
20,761
|
|
$
|
13,191
|
|
$
|
33,952
|
|
$
|
38,487
|
|
$
|
14,772
|
|
$
|
53,259
|
Equity in earnings of
unconsolidated affiliates (SHR ownership)
|
|
|
|
|
|
|
|
|
|
|
Property
EBITDA
|
|
$
|
7,426
|
|
$
|
6,595
|
|
$
|
14,021
|
|
$
|
13,999
|
|
$
|
7,386
|
|
$
|
21,385
|
Depreciation and
amortization
|
|
(3,526)
|
|
(1,551)
|
|
(5,077)
|
|
(5,647)
|
|
(5,005)
|
|
(10,652)
|
Interest
expense
|
|
(3,418)
|
|
(168)
|
|
(3,586)
|
|
(6,384)
|
|
(585)
|
|
(6,969)
|
Other expenses,
net
|
|
(25)
|
|
(30)
|
|
(55)
|
|
(228)
|
|
(35)
|
|
(263)
|
Income
taxes
|
|
143
|
|
—
|
|
143
|
|
(276)
|
|
—
|
|
(276)
|
Equity in earnings of
unconsolidated affiliates
|
|
$
|
600
|
|
$
|
4,846
|
|
$
|
5,446
|
|
$
|
1,464
|
|
$
|
1,761
|
|
$
|
3,225
|
EBITDA
Contribution
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated affiliates
|
|
$
|
600
|
|
$
|
4,846
|
|
$
|
5,446
|
|
$
|
1,464
|
|
$
|
1,761
|
|
$
|
3,225
|
Depreciation and
amortization
|
|
3,526
|
|
1,551
|
|
5,077
|
|
5,647
|
|
5,005
|
|
10,652
|
Interest
expense
|
|
3,418
|
|
168
|
|
3,586
|
|
6,384
|
|
585
|
|
6,969
|
Income
taxes
|
|
(143)
|
|
—
|
|
(143)
|
|
276
|
|
—
|
|
276
|
EBITDA
Contribution
|
|
$
|
7,401
|
|
$
|
6,565
|
|
$
|
13,966
|
|
$
|
13,771
|
|
$
|
7,351
|
|
$
|
21,122
|
FFO
Contribution
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated affiliates
|
|
$
|
600
|
|
$
|
4,846
|
|
$
|
5,446
|
|
$
|
1,464
|
|
$
|
1,761
|
|
$
|
3,225
|
Depreciation and
amortization
|
|
3,526
|
|
1,551
|
|
5,077
|
|
5,647
|
|
5,005
|
|
10,652
|
FFO
Contribution
|
|
$
|
4,126
|
|
$
|
6,397
|
|
$
|
10,523
|
|
$
|
7,111
|
|
$
|
6,766
|
|
$
|
13,877
|
Strategic Hotels
& Resorts, Inc. and Subsidiaries (SHR)
Leasehold
Information
(in
thousands)
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Marriott
Hamburg:
|
|
|
|
|
|
|
|
|
Property
EBITDA
|
|
$
|
1,757
|
|
$
|
1,655
|
|
$
|
4,956
|
|
$
|
4,557
|
Revenue
(a)
|
|
$
|
1,264
|
|
$
|
1,416
|
|
$
|
3,882
|
|
$
|
3,776
|
|
|
|
|
|
|
|
|
|
Lease
expense
|
|
(1,215)
|
|
(1,202)
|
|
(3,733)
|
|
(3,584)
|
Less: Deferred gain
on sale-leaseback
|
|
(52)
|
|
(52)
|
|
(159)
|
|
(154)
|
Adjusted lease
expense
|
|
(1,267)
|
|
(1,254)
|
|
(3,892)
|
|
(3,738)
|
|
|
|
|
|
|
|
|
|
Comparable EBITDA
contribution from leasehold
|
|
$
|
(3)
|
|
$
|
162
|
|
$
|
(10)
|
|
$
|
38
|
|
|
|
Security Deposit
(b):
|
|
September 30,
2014
|
|
December 31,
2013
|
Marriott
Hamburg
|
|
$
|
2,400
|
|
$
|
2,611
|
|
|
|
|
|
|
|
|
|
(a)
|
For the three and
nine months ended September 30, 2014 and 2013, 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.
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 on non-depreciable
assets, 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,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
20,988
|
|
$
|
3,760
|
|
$
|
318,986
|
|
$
|
(16,414)
|
Depreciation and
amortization—continuing operations
|
|
32,932
|
|
23,906
|
|
83,195
|
|
73,505
|
Depreciation and
amortization—discontinued operations
|
|
—
|
|
2,338
|
|
1,275
|
|
6,954
|
Interest
expense—continuing operations
|
|
21,844
|
|
19,227
|
|
59,705
|
|
58,350
|
Interest
expense—discontinued operations
|
|
—
|
|
1,879
|
|
1,326
|
|
5,521
|
Income
taxes—continuing operations
|
|
370
|
|
(15)
|
|
616
|
|
70
|
Income
taxes—discontinued operations
|
|
—
|
|
(415)
|
|
833
|
|
1,051
|
Income taxes—sale of
assets
|
|
—
|
|
—
|
|
20,451
|
|
—
|
Noncontrolling
interests
|
|
67
|
|
29
|
|
1,197
|
|
(22)
|
Adjustments from
consolidated affiliates
|
|
(4,070)
|
|
(3,912)
|
|
(11,684)
|
|
(11,015)
|
Adjustments from
unconsolidated affiliates
|
|
(11)
|
|
5,903
|
|
8,432
|
|
17,936
|
Preferred shareholder
dividends
|
|
1,802
|
|
6,042
|
|
18,795
|
|
18,125
|
EBITDA
|
|
73,922
|
|
58,742
|
|
503,127
|
|
154,061
|
Realized portion of
deferred gain on sale-leaseback
|
|
(52)
|
|
(52)
|
|
(159)
|
|
(154)
|
Loss (gain) on sale
of assets—continuing operations
|
|
38
|
|
1,028
|
|
(729)
|
|
755
|
(Loss) gain on sale
of assets—adjustments from consolidated affiliates
|
|
(5)
|
|
(370)
|
|
104
|
|
(370)
|
Gain on sale of
assets—discontinued operations
|
|
(63)
|
|
—
|
|
(176,943)
|
|
—
|
Loss (gain) on
consolidation of affiliates
|
|
15
|
|
—
|
|
(143,451)
|
|
—
|
Impairment losses and
other charges
|
|
—
|
|
728
|
|
—
|
|
728
|
Loss on early
extinguishment of debt—continuing operations
|
|
609
|
|
—
|
|
609
|
|
—
|
Loss on early
extinguishment of debt—discontinued operations
|
|
—
|
|
—
|
|
272
|
|
—
|
Foreign currency
exchange loss (gain)—continuing operations (a)
|
|
69
|
|
(28)
|
|
75
|
|
(26)
|
Foreign currency
exchange loss (gain)—discontinued operations (a)
|
|
—
|
|
37
|
|
(32)
|
|
(151)
|
Non-cash interest
rate derivative activity
|
|
127
|
|
—
|
|
127
|
|
—
|
Amortization of below
market hotel management agreement
|
|
513
|
|
—
|
|
621
|
|
—
|
Activist shareholder
costs
|
|
—
|
|
—
|
|
1,637
|
|
—
|
Comparable
EBITDA
|
|
$
|
75,173
|
|
$
|
60,085
|
|
$
|
185,258
|
|
$
|
154,843
|
|
|
(a)
|
Foreign currency
exchange gains or losses applicable to 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,
|
|
|
2014
|
|
2013
|
|
2014
|
|
2013
|
Net income (loss)
attributable to SHR common shareholders
|
|
$
|
20,988
|
|
$
|
3,760
|
|
$
|
318,986
|
|
$
|
(16,414)
|
Depreciation and
amortization—continuing operations
|
|
32,932
|
|
23,906
|
|
83,195
|
|
73,505
|
Depreciation and
amortization—discontinued operations
|
|
—
|
|
2,338
|
|
1,275
|
|
6,954
|
Corporate
depreciation
|
|
(124)
|
|
(125)
|
|
(370)
|
|
(383)
|
Loss (gain) on sale
of assets—continuing operations
|
|
38
|
|
1,028
|
|
(729)
|
|
755
|
Gain on sale of
assets, net of tax—discontinued operations
|
|
(63)
|
|
—
|
|
(156,492)
|
|
—
|
Loss (gain) on
consolidation of affiliates
|
|
15
|
|
—
|
|
(143,451)
|
|
—
|
Realized portion of
deferred gain on sale-leaseback
|
|
(52)
|
|
(52)
|
|
(159)
|
|
(154)
|
Noncontrolling
interests adjustments
|
|
(105)
|
|
(25)
|
|
(298)
|
|
(277)
|
Adjustments from
consolidated affiliates
|
|
(2,166)
|
|
(2,269)
|
|
(5,972)
|
|
(5,565)
|
Adjustments from
unconsolidated affiliates
|
|
—
|
|
3,429
|
|
5,077
|
|
10,653
|
FFO
|
|
51,463
|
|
31,990
|
|
101,062
|
|
69,074
|
Redeemable
noncontrolling interests
|
|
172
|
|
53
|
|
1,495
|
|
255
|
FFO—Fully
Diluted
|
|
51,635
|
|
32,043
|
|
102,557
|
|
69,329
|
Impairment losses and
other charges
|
|
—
|
|
728
|
|
—
|
|
728
|
Non-cash interest
rate derivative activity—continuing operations
|
|
3,241
|
|
(2,222)
|
|
3,131
|
|
(6,873)
|
Non-cash interest
rate derivative activity—discontinued operations
|
|
—
|
|
(755)
|
|
—
|
|
(2,248)
|
Loss on early
extinguishment of debt—continuing operations
|
|
609
|
|
—
|
|
609
|
|
—
|
Loss on early
extinguishment of debt—discontinued operations
|
|
—
|
|
—
|
|
272
|
|
—
|
Foreign currency
exchange loss (gain)—continuing operations (a)
|
|
69
|
|
(28)
|
|
75
|
|
(26)
|
Foreign currency
exchange loss (gain)—discontinued operations (a)
|
|
—
|
|
37
|
|
(32)
|
|
(151)
|
Amortization of debt
discount
|
|
623
|
|
—
|
|
1,246
|
|
—
|
Amortization of below
market hotel management agreement
|
|
513
|
|
—
|
|
621
|
|
—
|
Activist shareholder
costs
|
|
—
|
|
—
|
|
1,637
|
|
—
|
Excess of redemption
liability over carrying amount of redeemed preferred
stock
|
|
—
|
|
—
|
|
6,912
|
|
—
|
Comparable
FFO
|
|
$
|
56,690
|
|
$
|
29,803
|
|
$
|
117,028
|
|
$
|
60,759
|
Comparable FFO per
fully diluted share
|
|
$
|
0.23
|
|
$
|
0.14
|
|
$
|
0.51
|
|
$
|
0.29
|
Weighted average
diluted shares (b)
|
|
251,862
|
|
209,722
|
|
229,364
|
|
209,125
|
|
|
(a)
|
Foreign currency
exchange gains or losses applicable to 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)
|
Fairmont Scottsdale
Princess (c)
|
|
0.52%
|
|
36 bp
|
|
$
|
117,000
|
|
April 2015
|
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
|
|
185,826
|
|
September
2017
|
Hyatt Regency La
Jolla (d)
|
|
4.50% /
10.00%
|
|
400 bp /
Fixed
|
|
89,262
|
|
December
2017
|
Hotel del Coronado
(e)
|
|
3.81%
|
|
365 bp
|
|
475,000
|
|
March 2018
|
Bank credit facility
(f)
|
|
2.16%
|
|
200 bp
|
|
—
|
|
April 2019
|
Four Seasons
Washington, D.C. (g)
|
|
2.41%
|
|
225 bp
|
|
120,000
|
|
June 2019
|
Loews Santa Monica
Beach Hotel (h)
|
|
2.71%
|
|
255 bp
|
|
120,000
|
|
May 2021
|
InterContinental
Chicago
|
|
5.61%
|
|
Fixed
|
|
143,060
|
|
August 2021
|
InterContinental
Miami (i)
|
|
3.99%
|
|
Fixed
|
|
115,000
|
|
September
2024
|
|
|
|
|
|
|
1,667,860
|
|
|
Unamortized discount
(c)
|
|
|
|
|
|
(1,246)
|
|
|
|
|
|
|
|
|
$
|
1,666,614
|
|
|
|
|
(a)
|
Spread over LIBOR
(0.16% at September 30, 2014). Interest on the JW Marriott
Essex House Hotel loan is subject to a 0.75% LIBOR floor. See (d)
below for interest on the Hyatt Regency La Jolla loan.
|
(b)
|
Includes extension
options.
|
(c)
|
On March 31, 2014, we
acquired the remaining 50.0% equity interest in the Fairmont
Scottsdale Princess hotel, resulting in the Fairmont Scottsdale
Princess hotel becoming wholly-owned by us. In connection with the
acquisition, we consolidated the Fairmont Scottsdale Princess hotel
and became fully obligated under the entire mortgage loan secured
by the Fairmont Scottsdale Princess hotel. We recorded the mortgage
loan at its fair value, which included a debt discount, which is
being amortized as additional interest expense over the maturity
period of the loan.
|
(d)
|
Interest on
$72,000,000 is payable at an annual rate of LIBOR plus 4.00%,
subject to a 0.50% LIBOR floor, and interest on $17,262,000 is
payable at a fixed rate of 10.00%.
|
(e)
|
On June 11, 2014, we
acquired the remaining 63.6% equity interest in the Hotel del
Coronado, resulting in the Hotel del Coronado becoming wholly-owned
by us. In connection with the acquisition, we consolidated the
Hotel del Coronado and became fully obligated under the entire
outstanding balance of the mortgage and mezzanine loans secured by
the Hotel del Coronado.
|
(f)
|
On April 25, 2014, we
entered into a new $300,000,000 secured bank credit facility, which
replaced the previous secured bank credit facility.
|
(g)
|
On June 30, 2014, we
refinanced the loan secured by the Four Seasons Washington, D.C.
hotel.
|
(h)
|
On May 29, 2014, we
refinanced the loan secured by the Loews Santa Monica Beach
Hotel.
|
(i)
|
On August 29, 2014,
we entered into a new $115,000,000 loan secured by the
InterContinental Miami hotel, which replaced the previous
$85,000,000 loan.
|
Debt Summary
(Continued)
(dollars in
thousands)
|
|
Future scheduled debt
principal payments (including extension options) are as
follows:
|
|
Years ending
December 31,
|
|
Amount
|
2014
(remainder)
|
|
$
|
474
|
2015
|
|
120,140
|
2016
|
|
6,831
|
2017
|
|
573,972
|
2018
|
|
477,299
|
Thereafter
|
|
489,144
|
|
|
1,667,860
|
Unamortized
discount
|
|
(1,246)
|
|
|
$
|
1,666,614
|
|
|
|
Percent of fixed rate
debt
|
|
34.7%
|
Weighted average
interest rate (j)
|
|
4.18%
|
Weighted average
maturity of fixed rate debt (debt with maturity of greater than one
year)
|
|
5.16%
|
|
|
(j)
|
Excludes the
amortization of deferred financing costs.
|
SOURCE Strategic Hotels & Resorts, Inc.