DIAMONDROCK HOSPITALITY COMPANY BETHESDA, Md., Aug. 7, 2015 /PRNewswire/ -- DiamondRock Hospitality Company (the "Company") (NYSE: DRH), a lodging-focused real estate investment trust that owns a portfolio of 29 premium hotels in the United States, today announced results of operations for the quarter ended June 30, 2015.
Second Quarter 2015 Highlights
-- Pro Forma RevPAR: Pro Forma RevPAR was $184.50, an increase of 6.0% from
the comparable period of 2014 and a new record for the Company.
-- Pro Forma Hotel Adjusted EBITDA Margin: Pro Forma Hotel Adjusted EBITDA
margin was 34.56%, an increase of 166 basis points from 2014.
-- Pro Forma Hotel Adjusted EBITDA: Pro Forma Hotel Adjusted EBITDA was
$85.4 million, an increase of 11.3% from 2014.
-- Adjusted EBITDA: Adjusted EBITDA was $81.1 million, an increase of 14.3%
from 2014.
-- Adjusted FFO: Adjusted FFO was $61.5 million and Adjusted FFO per
diluted share was $0.31.
-- Key West Acquisition: The Company acquired the 184-suite Sheraton Suites
Key West for $94.0 million on June 30, 2015.
-- Financing Activity: The Company refinanced the Renaissance Worthington
in April 2015 with a new 10-year $85.0 million mortgage loan that bears
interest at a fixed rate of 3.66%. The Company also repaid the $56.2
million mortgage loan secured by the Frenchman's Reef & Morning Star
Marriott Beach Resort in May 2015.
-- Dividends: The Company declared a dividend of $0.125 per share during
the second quarter, which was paid on July 14, 2015.
Recent Developments
-- Hotel Refinancing: The Company refinanced the JW Marriott Denver at
Cherry Creek in July 2015 with a new 10-year $65 million mortgage loan
bearing interest at a fixed rate of 4.33%.
Mark W. Brugger, President and Chief Executive Officer of DiamondRock Hospitality Company, stated, "Our second quarter results were strong and consistent with our expectations. We were particularly pleased that our RevPAR growth exceeded the upper upscale industry average and that we achieved a record profit margin for the Company as result of our focused asset management initiatives. Additionally, the execution of our external growth strategy also drove shareholder value with an accretive acquisition in Key West, the highest RevPAR market in the United States."
Operating Results
Discussions of "Pro Forma" assumes the Company owned each of its 29 hotels since January 1, 2014 but excludes the Hilton Garden Inn Times Square Central, since the hotel opened for business on September 1, 2014. Please see "Certain Definitions" and "Non-GAAP Financial Measures" attached to this press release for an explanation of the terms "EBITDA," "Adjusted EBITDA," "Hotel Adjusted EBITDA Margin," "FFO" and "Adjusted FFO."
For the quarter ended June 30, 2015, the Company reported the following:
Second Quarter
--------------
2015 2014 Change
---- ---- ------
Pro
Forma
ADR $220.97 $209.21 5.6%
Pro 83.5% 83.1% 0.4
Forma percentage
Occupancy points
Pro
Forma
RevPAR $184.50 $174.13 6.0%
Pro 166 basis
Forma points
Hotel
Adjusted
EBITDA
Margin 34.56% 32.90%
Adjusted
EBITDA $81.1 million $70.9 million $10.2 million
Adjusted
FFO $61.5 million $51.9 million $9.6 million
Adjusted
FFO
per
diluted
share $0.31 $0.26 $0.05
For the six months ended June 30, 2015, the Company reported the following:
Year To Date
------------
2015 2014 Change
---- ---- ------
Pro
Forma
ADR $212.01 $201.92 5.0%
Pro 79.8% 78.4% 1.4
Forma percentage
Occupancy points
Pro
Forma
RevPAR $169.09 $158.26 6.8%
Pro 154 basis
Forma points
Hotel
Adjusted
EBITDA
Margin 30.67% 29.13%
Adjusted
EBITDA $129.6 million $108.2 million $21.4 million
Adjusted
FFO $99.2 million $81.4 million $17.8 million
Adjusted
FFO
per
diluted
share $0.49 $0.41 $0.08
Key West Hotel Acquisition
The Company acquired the 184-suite Sheraton Suites Key West, located in Key West, Florida for $94.0 million on June 30, 2015. The purchase price represents a 12.8 multiple on forecasted 2015 Hotel Adjusted EBITDA. The hotel will continue to be managed by Ocean Properties, a leading third party manager that operates six hotels in Key West. The Company believes that there is upside in its investment by repositioning the Hotel over the next year into an all-suites, independent, boutique resort. The Company expects to improve the hotel's profit margins by approximately 500 basis points and expects the hotel to generate approximately $9.5 to $10.0 million of annual Hotel Adjusted EBITDA upon stabilization as an independent hotel.
Hotel Financing Activity
In April 2015, the Company refinanced the Renaissance Worthington with a new $85.0 million mortgage loan. The new loan has a term of 10 years and a fixed interest rate of 3.66%. The new loan is interest-only for the first two years after which principal will amortize on a 30-year schedule. The hotel was previously encumbered by a $52.6 million mortgage loan bearing interest at a fixed rate of 5.4%.
In May 2015, the Company repaid the mortgage loan secured by the Frenchman's Reef & Morning Star Marriott Beach Resort. The loan had an outstanding principal balance of $56.2 million and a fixed interest rate of 5.44%.
In July 2015, the Company refinanced the JW Marriott Denver at Cherry Creek with a new $65.0 million mortgage loan. The new loan has a term of 10 years and a fixed interest rate of 4.33%. The new loan is interest-only for the first year after which principal will amortize on a 30-year schedule. The hotel was previously encumbered by a $38.1 million mortgage loan bearing interest at a fixed rate of 6.47%.
Westin Boston Expansion Option Update
In connection with the 2007 acquisition of the Westin Boston Waterfront Hotel, the Company assumed an option to acquire a leasehold interest in a parcel of land adjacent to the hotel with development rights to expand the hotel. During the quarter ended June 30, 2015, the Company decided not to exercise this option. As a result, the Company recorded a non-cash impairment charge of approximately $9.6 million, which represented a write-off of the favorable lease asset and other assets related to the option.
Capital Expenditures
The Company spent approximately $32.2 million on capital improvements during the six months ended June 30, 2015, primarily related to the addition of 41 rooms at the Hilton Boston Downtown and the first phase of guest room renovation at the Chicago Marriott Downtown.
The Company continues to expect to spend approximately $85 million on capital improvements at its hotels in 2015. Significant projects include the following:
-- Hilton Boston Downtown: The Company completed a return on investment
project at the hotel to create an incremental 41 guest rooms and upgrade
additional guest rooms, which created over 90 premium rooms.
-- Chicago Marriott Downtown: The Company commenced a multi-year guest room
renovation at the hotel. Marriott is contributing to the cost of the
renovation through an amendment to the hotel's management agreement to
reduce management fees for the remaining term of the agreement. The
amendment is expected to reduce management fees by approximately $1.8
million in 2015. The first phase of the guest room renovation, which
consisted of 140 rooms, including all 25 suites, was successfully
completed during the first quarter of 2015. The Company also added
Marriott's new prototype F&B grab-and-go outlet in the hotel's lobby.
The second phase of the guest room renovation will be completed during
the seasonally slow winter months over the next three years and is not
expected to result in material disruption.
-- The Lodge at Sonoma: The Company expects to renovate the guest rooms at
the hotel during the seasonally slow winter months of late 2015 and
early 2016.
-- Luxury Collection Hotel Chicago: The Company is rebranding the hotel
currently known as the Conrad Chicago to Starwood's Luxury Collection
during the third quarter. The renovation work associated with the brand
conversion will take place over the next two seasonally slow winter
seasons. The Company is currently finalizing the cost estimate of this
project.
Balance Sheet
As of June 30, 2015, the Company had $84.1 million of unrestricted cash on hand and approximately $1.1 billion of total debt, which consisted of property-specific mortgage debt and $90.0 million outstanding on the Company's $200.0 million senior unsecured credit facility. Subsequent to June 30, 2015, the Company repaid $50.0 million of borrowings and currently has $40.0 million outstanding on its senior unsecured credit facility.
ATM Equity Offering Program
The Company did not sell any shares under its $200 million at-the-market ("ATM") equity offering program during the second quarter. The Company currently has $128.3 million remaining under the ATM program.
Dividends
The Company's Board of Directors declared a quarterly dividend of $0.125 per share to stockholders of record as of June 30, 2015. The dividend was paid on July 14, 2015.
Outlook and Guidance
The Company has provided full year and third quarter guidance for 2015, but does not undertake to update it for any developments in its business. Achievement of the anticipated results is subject to the risks disclosed in the Company's filings with the U.S. Securities and Exchange Commission. Pro Forma RevPAR and Pro Forma Hotel Adjusted EBITDA margin growth assume that all of the Company's 29 hotels were owned since January 1, 2014 but excludes the Hilton Garden Inn Times Square Central until September 1, 2015, since the hotel opened on September 1, 2014.
The Company is increasing its full year 2015 guidance to incorporate the acquisition of Sheraton Suites Key West, as follows:
Previous Guidance Current Guidance
----------------- ----------------
Metric Low End High End Low End High End
------ ------- --------
Pro Forma RevPAR Growth 6 percent 7 percent 6 percent 7 percent
Pro Forma Hotel Adjusted EBITDA Margin Growth 100 basis points 150 basis points 125 basis points 175 basis points
Adjusted EBITDA $264 million $274 million $266.5 million $276.5 million
Adjusted FFO $201 million $206 million $202 million $208 million
Adjusted FFO per share $1.00 per share $1.02 per share $1.00 per share $1.03 per share
(based on 201.2 million shares)
------------------------------
In addition, the Company expects income tax expense of $11.4 million to $15.4 million, interest expense of approximately $53 million and corporate expenses of approximately $24 million for the full year 2015.
The Company expects the following for the third quarter of 2015:
-- Pro Forma RevPAR growth of 3 percent to 5 percent;
-- Adjusted EBITDA to range from 26 percent to 26.5 percent of full year
2015 Adjusted EBITDA; and
-- Income tax expense of $2.5 million to $3.5 million, which assumes the
Company receives the extension of the income tax agreement with the U.S.
Virgin Islands related to the Frenchman's Reef & Morning Star Marriott
Beach Resort during the third quarter.
The following table is presented to provide investors with selected quarterly Pro Forma operating information for 2014. The operating information assumes that all of the Company's 29 hotels were owned since January 1, 2014, with the exception of the Hilton Garden Inn Times Square Central, which opened for business on September 1, 2014.
Quarter 1, 2014 Quarter 2, 2014 Quarter 3, 2014 Quarter 4, 2014 Full Year 2014
--------------- --------------- --------------- --------------- --------------
ADR $193.57 $209.21 $207.26 $215.08 $206.58
Occupancy 73.5% 83.1% 83.5% 75.9% 79.0%
RevPAR $142.22 $174.13 $173.07 $163.21 $163.26
Revenues (in thousands) $196,962 $233,298 $227,547 $224,153 $881,960
Hotel Adjusted EBITDA (in thousands) $48,562 $76,755 $70,771 $67,535 $263,623
% of full Year 18.4% 29.1% 26.8% 25.7% 100.0%
Hotel Adjusted EBITDA Margin 24.66% 32.90% 31.10% 30.13% 29.89%
Available Rooms 952,830 963,417 982,464 999,948 3,898,659
--------------- ------- ------- ------- ------- ---------
Earnings Call
The Company will host a conference call to discuss its second quarter results on Friday, August 7, 2015, at 10:00 a.m. Eastern Time (ET). To participate in the live call, investors are invited to dial 888-310-1786 (for domestic callers) or 330-863-3357 (for international callers). The participant passcode is 75900668. A live webcast of the call will be available via the investor relations section of DiamondRock Hospitality Company's website at www.drhc.com or www.earnings.com. A replay of the webcast will also be archived on the website for one week.
About the Company
DiamondRock Hospitality Company is a self-advised real estate investment trust (REIT) that is an owner of a leading portfolio of geographically diversified hotels concentrated in top gateway markets and destination resort locations. The Company owns 29 premium quality hotels with over 10,900 rooms. The Company has strategically positioned its hotels to be operated both under leading global brands such as Hilton, Marriott, and Westin and boutique hotels in the lifestyle segment. For further information on the Company and its portfolio, please visit DiamondRock Hospitality Company's website at www.drhc.com.
This press release contains forward-looking statements within the meaning of federal securities laws and regulations. These forward-looking statements are identified by their use of terms and phrases such as "believe," "expect," "intend," "project," "forecast," "plan" and other similar terms and phrases, including references to assumptions and forecasts of future results. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. These risks include, but are not limited to: national and local economic and business conditions, including the potential for additional terrorist attacks, that will affect occupancy rates at the Company's hotels and the demand for hotel products and services; operating risks associated with the hotel business; risks associated with the level of the Company's indebtedness; relationships with property managers; the ability to compete effectively in areas such as access, location, quality of accommodations and room rate structures; changes in travel patterns, taxes and government regulations which influence or determine wages, prices, construction procedures and costs; the ability to extend the income tax agreement, and other risk factors contained in the Company's filings with the Securities and Exchange Commission. Although the Company believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. All information in this release is as of the date of this release, and the Company undertakes no obligation to update any forward-looking statement to conform the statement to actual results or changes in the Company's expectations.
DIAMONDROCK HOSPITALITY COMPANY
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
June 30, 2015 December 31, 2014
------------- -----------------
ASSETS (unaudited)
Property and equipment, net $2,896,383 $2,764,393
Deferred financing costs, net 7,751 8,023
Restricted cash 60,203 74,730
Due from hotel managers 100,323 79,827
Favorable lease assets, net 24,171 34,274
Prepaid and other assets (1) 54,314 52,739
Cash and cash equivalents 84,123 144,365
------ -------
Total assets $3,227,268 $3,158,351
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Mortgage debt $1,007,326 $1,038,330
Senior unsecured credit facility 90,000 -
------ ---
Total debt 1,097,326 1,038,330
Deferred income related to key money, net 21,027 21,561
Unfavorable contract liabilities, net 75,613 76,220
Due to hotel managers 66,965 59,169
Dividends declared and unpaid 25,479 20,922
Accounts payable and accrued expenses (2) 118,786 113,162
------- -------
Total other liabilities 307,870 291,034
Stockholders' Equity:
Preferred stock, $0.01 par value; 10,000,000
shares authorized; no shares issued and
outstanding - -
Common stock, $0.01 par value; 400,000,000
shares authorized; 200,735,245 and
199,964,041 shares issued and outstanding
at June 30, 2015 and December 31, 2014,
respectively 2,007 2,000
Additional paid-in capital 2,053,938 2,045,755
Accumulated deficit (233,873) (218,768)
-------- --------
Total stockholders' equity 1,822,072 1,828,987
--------- ---------
Total liabilities and stockholders' equity $3,227,268 $3,158,351
========== ==========
(1) Includes $40.5 million of deferred tax assets, $9.8 million of prepaid expenses and $4.0 million of other assets as of June 30, 2015.
(2) Includes $67.5 million of deferred ground rent, $17.2 million of deferred tax liabilities, $15.9 million of accrued property taxes, $5.0 million
of accrued capital expenditures and $13.2 million of other accrued liabilities as of June 30, 2015.
DIAMONDROCK HOSPITALITY COMPANY
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2015 2014 2015 2014
---- ---- ---- ----
Revenues:
Rooms $181,563 $165,088 $326,199 $294,824
Food and beverage 56,073 52,182 108,406 100,793
Other 12,165 12,664 24,084 24,401
------ ------ ------ ------
Total revenues 249,801 229,934 458,689 420,018
------- ------- ------- -------
Operating Expenses:
Rooms 41,993 41,143 80,457 79,248
Food and beverage 35,355 34,693 70,901 69,193
Management fees 8,903 8,459 15,103 13,752
Other hotel expenses 77,546 72,393 154,052 144,869
Depreciation and amortization 25,574 25,126 49,911 50,249
Impairment losses 9,675 - 10,461 -
Hotel acquisition costs 260 - 492 -
Corporate expenses 6,331 4,690 11,741 9,878
Gain on insurance proceeds - (608) - (1,271)
Gain on litigation settlement, net - (10,999) - (10,999)
Total operating expenses 205,637 174,897 393,118 354,919
------- ------- ------- -------
Operating profit 44,164 55,037 65,571 65,099
------ ------ ------ ------
Interest income (60) (957) (150) (2,609)
Interest expense 12,838 14,600 26,056 29,125
Other income, net (167) - (204) -
Gain on sale of hotel property - (1,290) - (1,290)
Gain on prepayment of note receivable - (13,550) - (13,550)
--- ------- --- -------
Total other expenses (income), net 12,611 (1,197) 25,702 11,676
------ ------ ------ ------
Income before income taxes 31,553 56,234 39,869 53,423
Income tax (expense) benefit (6,731) (4,318) (4,405) 2,530
------ ------ ------ -----
Net income $24,822 $51,916 $35,464 $55,953
======= ======= ======= =======
Earnings per share:
Basic earnings per share $0.12 $0.27 $0.18 $0.29
===== ===== ===== =====
Diluted earnings per share $0.12 $0.26 $0.18 $0.29
===== ===== ===== =====
Weighted-average number of common shares outstanding:
Basic 200,830,064 195,776,924 200,738,301 195,700,864
=========== =========== =========== ===========
Diluted 201,142,747 196,246,718 201,115,115 196,217,724
=========== =========== =========== ===========
Non-GAAP Financial Measures
We use the following non-GAAP financial measures that we believe are useful to investors as key measures of our operating performance: EBITDA, Adjusted EBITDA, FFO and Adjusted FFO. These measures should not be considered in isolation or as a substitute for measures of performance in accordance with GAAP. EBITDA, Adjusted EBITDA, FFO and Adjusted FFO, as calculated by us, may not be comparable to other companies that do not define such terms exactly as the Company.
EBITDA and FFO
EBITDA represents net income excluding: (1) interest expense; (2) provision for income taxes, including income taxes applicable to sale of assets; and (3) depreciation and amortization. We believe EBITDA is useful to an investor in evaluating our operating performance because it helps investors evaluate and compare the results of our operations from period to period by removing the impact of our capital structure (primarily interest expense) and our asset base (primarily depreciation and amortization) from our operating results. In addition, covenants included in our indebtedness use EBITDA as a measure of financial compliance. We also use EBITDA as one measure in determining the value of hotel acquisitions and dispositions.
The Company computes FFO in accordance with standards established by NAREIT, which defines FFO as net income determined in accordance with GAAP, excluding gains or losses from sales of properties and impairment losses, plus depreciation and amortization. The Company believes that the presentation of FFO provides useful information to investors regarding its operating performance because it is a measure of the Company's operations without regard to specified non-cash items, such as real estate depreciation and amortization and gain or loss on sale of assets. The Company also uses FFO as one measure in assessing its results.
Adjustments to EBITDA and FFO
We adjust EBITDA and FFO when evaluating our performance because we believe that the exclusion of certain additional recurring and non-recurring items described below provides useful supplemental information to investors regarding our ongoing operating performance and that the presentation of Adjusted EBITDA and Adjusted FFO, when combined with GAAP net income, EBITDA and FFO, is beneficial to an investor's complete understanding of our operating performance. We adjust EBITDA and FFO for the following items:
-- Non-Cash Ground Rent: We exclude the non-cash expense incurred from the
straight line recognition of rent from our ground lease obligations and
the non-cash amortization of our favorable lease assets.
-- Non-Cash Amortization of Favorable and Unfavorable Contracts: We exclude
the non-cash amortization of favorable and unfavorable contract assets
and liabilities recorded in conjunction with certain acquisitions. The
amortization of the favorable and unfavorable contracts does not reflect
the underlying operating performance of our hotels.
-- Cumulative Effect of a Change in Accounting Principle: Infrequently, the
Financial Accounting Standards Board (FASB) promulgates new accounting
standards that require the consolidated statement of operations to
reflect the cumulative effect of a change in accounting principle. We
exclude the effect of these one-time adjustments because they do not
reflect our actual performance for that period.
-- Gains or Losses from Early Extinguishment of Debt: We exclude the effect
of gains or losses recorded on the early extinguishment of debt because
we believe they do not accurately reflect the underlying performance of
the Company.
-- Acquisition Costs: We exclude acquisition transaction costs expensed
during the period because we believe they do not reflect the underlying
performance of the Company.
-- Allerton Loan: We exclude the gain from the prepayment of the loan in
2014.
-- Other Non-Cash and /or Unusual Items: From time to time we incur costs
or realize gains that we do not believe reflect the underlying
performance of the Company. Such items include, but are not limited to,
hotel pre-opening costs, hotel manager transition costs, contract
termination fees, severance costs, gains or losses from legal
settlements, bargain purchase gains, and insurance proceeds.
In addition, to derive Adjusted EBITDA we exclude gains or losses on dispositions and impairment losses because we believe that including them in EBITDA does not reflect the ongoing performance of our hotels. Additionally, the gains or losses on dispositions and impairment losses represent either accelerated depreciation or excess depreciation in previous periods, and depreciation is excluded from EBITDA.
In addition, to derive Adjusted FFO we exclude any fair value adjustments to debt instruments. Specifically, we exclude the impact of the non-cash amortization of the debt premium recorded in conjunction with the acquisition of the JW Marriott Denver at Cherry Creek and any fair market value adjustments to the Company's interest rate cap agreement.
The following tables are reconciliations of our GAAP net income to EBITDA and Adjusted EBITDA (in thousands):
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2015 2014 2015 2014
---- ---- ---- ----
Net income $24,822 $51,916 $35,464 $55,953
Interest expense 12,838 14,600 26,056 29,125
Income tax expense (benefit) 6,731 4,318 4,405 (2,530)
Real estate related depreciation and amortization 25,574 25,126 49,911 50,249
EBITDA 69,965 95,960 115,836 132,797
Non-cash ground rent 1,479 1,596 2,987 3,292
Non-cash amortization of favorable and unfavorable contract liabilities, net (374) (353) (727) (705)
Impairment losses 9,675 - 10,461 -
Gain on insurance proceeds - (608) - (1,271)
Gain on sale of hotel property - (1,290) - (1,290)
Gain on litigation settlement (1) - (10,999) - (10,999)
Gain on prepayment of note receivable - (13,550) - (13,550)
Reversal of previously recognized Allerton income - (162) - (453)
Hotel acquisition costs 260 45 492 81
Hotel manager transition and pre-opening costs (2) 66 272 534 286
Adjusted EBITDA $81,071 $70,911 $129,583 $108,188
======= ======= ======== ========
(1) Includes $14.0 million of settlement proceeds, net of a $1.2 million contingency fee paid to our legal counsel and $1.8 million of legal fees and other costs incurred over the course of the legal proceedings. The $1.8 million of legal fees and other costs were previously recorded as corporate expenses and the repayment of those
costs through the settlement proceeds is recorded as a reduction of corporate expenses.
(2) Classified as other hotel expenses on the consolidated statements of operations.
Full Year 2015 Guidance
-----------------------
Low End High End
------- --------
Net income $85,839 $92,839
Interest expense 53,000 53,000
Income tax expense 11,400 15,400
Real estate
related
depreciation and
amortization 100,000 99,000
EBITDA 250,239 260,239
Non-cash ground
rent 5,700 5,700
Non-cash
amortization of
favorable and
unfavorable
contracts, net (1,400) (1,400)
Impairment losses 10,461 10,461
Hotel acquisition
costs 500 500
Hotel manager
transition and
pre-opening
costs 1,000 1,000
Adjusted EBITDA $266,500 $276,500
======== ========
The following tables are reconciliations of our GAAP net income to FFO and Adjusted FFO (in thousands):
Three Months Ended Six Months Ended
June 30, June 30,
-------- --------
2015 2014 2015 2014
---- ---- ---- ----
Net income $24,822 $51,916 $35,464 $55,953
Real estate related depreciation and amortization 25,574 25,126 49,911 50,249
Gain on sale of hotel property - (1,290) - (1,290)
Impairment losses 9,675 - 10,461 -
FFO 60,071 75,752 95,836 104,912
Non-cash ground rent 1,479 1,596 2,987 3,292
Non-cash amortization of favorable and unfavorable contract liabilities, net (374) (353) (727) (705)
Gain on insurance proceeds - (608) - (1,271)
Gain on litigation settlement (1) - (10,999) - (10,999)
Gain on prepayment of note receivable - (13,550) - (13,550)
Hotel acquisition costs 260 45 492 81
Hotel manager transition and pre-opening costs (2) 66 272 534 286
Reversal of previously recognized Allerton income - (162) - (453)
Fair value adjustments to debt instruments (14) (90) 66 (175)
Adjusted FFO $61,488 $51,903 $99,188 $81,418
======= ======= ======= =======
Adjusted FFO per diluted share $0.31 $0.26 $0.49 $0.41
===== ===== ===== =====
(1) Includes $14.0 million of settlement proceeds, net of a $1.2 million contingency fee paid to our legal counsel and $1.8 million of legal fees and other costs incurred over the course of the legal proceedings. The $1.8 million of legal fees and other costs were previously
recorded as corporate expenses and the repayment of those costs through the settlement proceeds is recorded as a reduction of corporate expenses.
(2) Classified as other hotel expenses on the consolidated statements of operations.
Full Year 2015 Guidance
-----------------------
Low End High End
------- --------
Net income $85,839 $92,839
Real estate related depreciation and amortization 100,000 99,000
Impairment losses 10,461 10,461
FFO 196,300 202,300
Non-cash ground rent 5,700 5,700
Non-cash amortization of favorable and unfavorable contract liabilities, net (1,400) (1,400)
Hotel acquisition costs 500 500
Hotel manager transition and pre-opening costs 1,000 1,000
Fair value adjustments to debt instruments (100) (100)
Adjusted FFO $202,000 $208,000
======== ========
Adjusted FFO per diluted share $1.00 $1.03
===== =====
Use and Limitations of Non-GAAP Financial Measures
Our management and Board of Directors use EBITDA, Adjusted EBITDA, FFO and Adjusted FFO to evaluate the performance of our hotels and to facilitate comparisons between us and other lodging REITs, hotel owners who are not REITs and other capital intensive companies. The use of these non-GAAP financial measures has certain limitations. These non-GAAP financial measures as presented by us, may not be comparable to non-GAAP financial measures as calculated by other real estate companies. These measures do not reflect certain expenses or expenditures that we incurred and will incur, such as depreciation, interest and capital expenditures. We compensate for these limitations by separately considering the impact of these excluded items to the extent they are material to operating decisions or assessments of our operating performance. Our reconciliations to the most comparable GAAP financial measures, and our consolidated statements of operations and cash flows, include interest expense, capital expenditures, and other excluded items, all of which should be considered when evaluating our performance, as well as the usefulness of our non-GAAP financial measures.
These non-GAAP financial measures are used in addition to and in conjunction with results presented in accordance with GAAP. They should not be considered as alternatives to operating profit, cash flow from operations, or any other operating performance measure prescribed by GAAP. These non-GAAP financial measures reflect additional ways of viewing our operations that we believe, when viewed with our GAAP results and the reconciliations to the corresponding GAAP financial measures, provide a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. We strongly encourage investors to review our financial information in its entirety and not to rely on a single financial measure.
Certain Definitions
In this release, when we discuss "Hotel Adjusted EBITDA," we exclude from Hotel EBITDA the non-cash expense incurred by the hotels due to the straight lining of the rent from our ground lease obligations, the non-cash amortization of our favorable lease assets and other contracts, and the non-cash amortization of our unfavorable contract liabilities. Hotel EBITDA represents hotel net income excluding: (1) interest expense; (2) income taxes; and (3) depreciation and amortization. Hotel Adjusted EBITDA margins are calculated as Hotel Adjusted EBITDA divided by total hotel revenues. Net debt is calculated as total debt outstanding less unrestricted cash.
DIAMONDROCK HOSPITALITY COMPANY
HOTEL OPERATING DATA
Schedule of Property Level Results - Pro Forma (1)
(unaudited and in thousands)
Three Months Ended June 30, Six Months Ended June 30,
--------------------------- -------------------------
2015 2014 % Change 2015 2014 % Change
---- ---- -------- ---- ---- --------
ADR $220.97 $209.21 5.6% $212.01 $201.92 5.0%
Occupancy 83.5% 83.1% 0.4% 79.8% 78.4% 1.4%
RevPAR $184.50 $174.13 6.0% $169.09 $158.26 6.8%
Revenues:
Rooms $178,231 $167,756 6.2% $324,462 $303,268 7.0%
Food and beverage 56,571 53,251 6.2% 109,725 103,215 6.3%
Other 12,375 12,289 0.7% 24,565 23,782 3.3%
------ ------ --- ------ ------ ---
Total revenues $247,177 $233,296 5.9% $458,752 $430,265 6.6%
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Operating Expenses:
Rooms departmental expenses $41,463 $40,666 2.0% $79,950 $77,955 2.6%
Food and beverage departmental 35,714 35,228 1.4% 71,902 69,837 3.0%
expenses
Other direct departmental 4,286 4,717 (9.1)% 8,804 9,941 (11.4)%
General and administrative 18,139 17,177 5.6% 35,607 33,349 6.8%
Utilities 6,586 6,586 - % 13,856 14,007 (1.1)%
Repairs and maintenance 8,945 9,245 (3.2)% 18,101 18,412 (1.7)%
Sales and marketing 16,844 15,393 9.4% 32,077 28,938 10.8%
Franchise fees 5,043 4,109 22.7% 9,902 7,819 26.6%
Base management fees 6,235 5,749 8.5% 11,448 10,773 6.3%
Incentive management fees 2,649 2,814 (5.9)% 3,695 3,379 9.4%
Property taxes 10,406 9,497 9.6% 21,416 19,841 7.9%
Ground rent 3,796 3,754 1.1% 7,578 7,496 1.1%
Other fixed expenses 2,750 2,834 (3.0)% 5,971 5,666 5.4%
Hotel manager transition and pre-opening costs 66 272 (75.7)% 534 286 86.7%
Total hotel operating expenses 162,922 158,041 3.1% 320,841 307,699 4.3%
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Hotel EBITDA $84,255 $75,255 12.0% $137,911 $122,566 12.5%
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Non-cash ground rent 1,479 1,580 (6.4)% 2,987 3,169 (5.7)%
Non-cash amortization of unfavorable (364) (352) 3.4% (732) (704) 4.0%
contract liabilities
Hotel manager transition and pre-opening costs (2) 66 272 (75.7)% 534 286 86.7%
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Hotel Adjusted EBITDA $85,436 $76,755 11.3% $140,700 $125,317 12.3%
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(1) Pro forma assumes the Company owned each of its 29 hotels since January 1, 2014 but excludes the Hilton Garden Inn Times Square Central, since the hotel opened for business on September 1, 2014.
(2) Classified as other hotel expenses on the consolidated statements of operations.
Market Capitalization as of June 30, 2015
(in thousands)
Enterprise Value
----------------
Common equity capitalization (at June
30, 2015 closing price of
$12.81/share) $2,578,938
Consolidated debt 1,097,326
Cash and cash equivalents (84,123)
-------
Total enterprise value $3,592,141
==========
Share Reconciliation
--------------------
Common shares outstanding 200,735
Unvested restricted stock held by
management and employees 475
Share grants under deferred
compensation plan held by directors 112
---
Combined shares outstanding 201,322
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Debt Summary as of June 30, 2015
(dollars in thousands)
Property Interest Rate Term Outstanding Maturity
Principal
--- ---------
JW Marriott Denver at Cherry
Creek (1) 6.47% Fixed $38,055 July 2015
Orlando Airport Marriott 5.68% Fixed 55,475 January 2016
Chicago Marriott Downtown
Magnificent Mile 5.98% Fixed 203,449 April 2016
Courtyard Manhattan /Fifth
Avenue 6.48% Fixed 48,640 June 2016
Marriott Salt Lake City
Downtown 4.25% Fixed 60,734 November 2020
Hilton Minneapolis 5.46% Fixed 91,789 May 2021
Westin Washington D.C. City
Center 3.99% Fixed 69,711 January 2023
The Lodge at Sonoma, a
Renaissance Resort & Spa 3.96% Fixed 29,819 April 2023
Westin San Diego 3.94% Fixed 68,286 April 2023
Courtyard Manhattan /Midtown
East 4.40% Fixed 86,000 August 2024
Renaissance Worthington 3.66% Fixed 85,000 May 2025
Total Weighted-Average
Interest Fixed Rate Debt 5.10% $836,958
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Lexington Hotel New York LIBOR + 2.25 Variable 170,368 October 2017 (2)
Total mortgage debt $1,007,326
==========
Senior unsecured credit
facility LIBOR + 1.75 Variable 90,000 January 2017 (3)
Total debt $1,097,326
==========
Total Weighted-Average
Interest Rate 4.43%
====
(1) The loan was repaid on July 1, 2015, at which time we entered into a new $65 million mortgage loan with a fixed rate of 4.33%. The new loan matures in
2025 and is interest-only for the first year, after which principal will amortize on a 30-year schedule.
(2) The loan may be extended for two additional one-year terms subject to the satisfaction of certain conditions and the payment of an extension fee.
(3) The credit facility may be extended for an additional year upon the payment of applicable fees and the satisfaction of certain customary conditions.
Pro Forma Operating Statistics - Second Quarter
ADR Occupancy RevPAR Hotel Adjusted EBITDA Margin
--- --------- ------ ----------------------------
2Q 2015 2Q 2014 B/(W) 2Q 2015 2Q 2014 B/(W) 2Q 2015 2Q 2014 B/(W) 2Q 2015 2Q 2014 B/(W)
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Atlanta Alpharetta Marriott $156.63 $160.85 (2.6)% 77.9% 73.9% 4.0% $122.04 $118.83 2.7% 34.07% 35.49% -142 bps
Bethesda Marriott Suites $182.77 $169.79 7.6% 77.4% 77.6% (0.2)% $141.45 $131.68 7.4% 36.40% 33.70% 270 bps
Boston Westin $261.84 $244.25 7.2% 81.7% 87.1% (5.4)% $213.80 $212.79 0.5% 36.73% 34.51% 222 bps
Hilton Boston Downtown $315.17 $281.25 12.1% 88.6% 94.0% (5.4)% $279.15 $264.32 5.6% 45.92% 42.31% 361 bps
Hilton Burlington $163.37 $164.39 (0.6)% 84.7% 78.5% 6.2% $138.40 $129.06 7.2% 41.88% 42.16% -28 bps
Renaissance Charleston $248.37 $232.47 6.8% 95.2% 95.4% (0.2)% $236.43 $221.86 6.6% 42.90% 41.13% 177 bps
Hilton Garden Inn Chelsea $245.59 $245.18 0.2% 96.7% 97.3% (0.6)% $237.51 $238.45 (0.4)% 34.39% 45.70% -1131 bps
Chicago Marriott $245.52 $228.09 7.6% 85.0% 81.6% 3.4% $208.64 $186.21 12.0% 32.91% 30.03% 288 bps
Chicago Conrad $245.09 $248.55 (1.4)% 83.3% 88.8% (5.5)% $204.18 $220.61 (7.4)% 37.65% 40.14% -249 bps
Courtyard Denver Downtown $207.82 $192.74 7.8% 82.6% 83.5% (0.9)% $171.60 $161.03 6.6% 49.44% 51.23% -179 bps
Courtyard Fifth Avenue $289.68 $299.58 (3.3)% 91.7% 89.7% 2.0% $265.57 $268.74 (1.2)% 30.80% 31.90% -110 bps
Courtyard Midtown East $285.21 $299.12 (4.7)% 94.3% 93.4% 0.9% $268.89 $279.36 (3.7)% 38.12% 38.96% -84 bps
Fort Lauderdale Westin $172.43 $174.86 (1.4)% 84.7% 81.0% 3.7% $146.01 $141.58 3.1% 29.78% 19.76% 1002 bps
Frenchman's Reef $242.58 $218.75 10.9% 87.4% 89.4% (2.0)% $211.98 $195.47 8.4% 25.37% 22.24% 313 bps
JW Marriott Denver Cherry Creek $281.04 $260.20 8.0% 81.3% 84.2% (2.9)% $228.51 $219.17 4.3% 36.33% 33.34% 299 bps
Inn at Key West $210.18 $205.61 2.2% 90.6% 87.5% 3.1% $190.42 $179.90 5.8% 50.25% 54.43% -418 bps
Key West Sheraton Suites $235.94 $220.66 6.9% 94.6% 88.6% 6.0% $223.20 $195.41 14.2% 40.10% 35.47% 463 bps
Lexington Hotel New York $265.83 $259.45 2.5% 95.3% 94.0% 1.3% $253.42 $243.98 3.9% 37.55% 37.96% -41 bps
Hilton Minneapolis $157.27 $153.53 2.4% 83.9% 85.8% (1.9)% $131.95 $131.68 0.2% 27.98% 31.84% -386 bps
Orlando Airport Marriott $110.28 $101.68 8.5% 75.7% 79.7% (4.0)% $83.46 $81.03 3.0% 24.67% 22.16% 251 bps
Hotel Rex $226.06 $193.88 16.6% 90.1% 89.0% 1.1% $203.76 $172.64 18.0% 37.19% 33.83% 336 bps
Salt Lake City Marriott $150.61 $141.95 6.1% 75.1% 70.2% 4.9% $113.10 $99.71 13.4% 33.52% 32.34% 118 bps
Shorebreak $227.09 $201.89 12.5% 81.5% 85.3% (3.8)% $185.07 $172.23 7.5% 32.74% 27.44% 530 bps
The Lodge at Sonoma $286.72 $261.79 9.5% 84.0% 86.5% (2.5)% $240.84 $226.35 6.4% 34.27% 32.33% 194 bps
Hilton Garden Inn Times Square Central $277.41 N/A N/A 98.5% N/A N/A $273.37 N/A N/A 49.34% N/A N/A
Vail Marriott $161.62 $160.65 0.6% 52.4% 48.8% 3.6% $84.68 $78.40 8.0% 8.31% 7.61% 70 bps
Westin San Diego $185.89 $163.55 13.7% 86.4% 87.4% (1.0)% $160.61 $143.02 12.3% 32.99% 32.50% 49 bps
Westin Washington D.C. City Center $257.18 $213.86 20.3% 87.3% 83.5% 3.8% $224.44 $178.60 25.7% 43.07% 38.29% 478 bps
Renaissance Worthington $184.68 $176.59 4.6% 71.2% 70.0% 1.2% $131.57 $123.63 6.4% 37.53% 34.60% 293 bps
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Pro Forma Total (1) $220.97 $209.21 5.6% 83.5% 83.1% 0.4% $184.50 $174.13 6.0% 34.56% 32.90% 166 bps
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(1) Assumes all hotels were owned as of January 1, 2014 but excludes the Hilton Garden Inn Times Square Central (282 rooms), which opened for business on September 1, 2014.
Pro Forma Operating Statistics - Year to Date
ADR Occupancy RevPAR Hotel Adjusted EBITDA Margin
--- --------- ------ ----------------------------
YTD 2015 YTD 2014 B/(W) YTD 2015 YTD 2014 B/(W) YTD 2015 YTD 2014 B/(W) YTD 2015 YTD 2014 B/(W)
-------- -------- ----- -------- -------- ----- -------- -------- ----- -------- -------- -----
Atlanta Alpharetta Marriott $165.05 $165.84 (0.5)% 73.1% 70.5% 2.6% $120.67 $116.93 3.2% 35.10% 35.30% -20 bps
Bethesda Marriott Suites $177.33 $167.91 5.6% 67.1% 66.3% 0.8% $118.95 $111.28 6.9% 29.62% 26.97% 265 bps
Boston Westin $234.85 $221.08 6.2% 77.3% 76.1% 1.2% $181.44 $168.24 7.8% 29.63% 25.90% 373 bps
Hilton Boston Downtown $270.15 $234.08 15.4% 79.1% 88.4% (9.3)% $213.69 $206.96 3.3% 35.42% 33.51% 191 bps
Hilton Burlington $149.26 $144.01 3.6% 73.9% 71.4% 2.5% $110.35 $102.78 7.4% 34.03% 34.73% -70 bps
Renaissance Charleston $225.84 $208.13 8.5% 91.3% 91.5% (0.2)% $206.24 $190.49 8.3% 37.35% 36.19% 116 bps
Hilton Garden Inn Chelsea $205.97 $210.94 (2.4)% 92.2% 94.4% (2.2)% $190.00 $199.08 (4.6)% 25.14% 38.26% -1312 bps
Chicago Marriott $213.90 $199.04 7.5% 71.1% 69.8% 1.3% $152.18 $139.02 9.5% 20.71% 19.81% 90 bps
Chicago Conrad $213.82 $210.89 1.4% 73.4% 80.3% (6.9)% $156.92 $169.42 (7.4)% 23.67% 27.56% -389 bps
Courtyard Denver Downtown $198.69 $183.36 8.4% 78.8% 82.5% (3.7)% $156.66 $151.19 3.6% 46.40% 47.41% -101 bps
Courtyard Fifth Avenue $252.85 $260.95 (3.1)% 87.8% 87.2% 0.6% $221.92 $227.66 (2.5)% 18.63% 20.70% -207 bps
Courtyard Midtown East $249.30 $261.88 (4.8)% 89.7% 90.0% (0.3)% $223.70 $235.57 (5.0)% 27.59% 30.56% -297 bps
Fort Lauderdale Westin $202.13 $203.68 (0.8)% 90.7% 86.1% 4.6% $183.39 $175.29 4.6% 36.66% 28.43% 823 bps
Frenchman's Reef $287.65 $273.65 5.1% 88.5% 90.3% (1.8)% $254.47 $247.18 2.9% 29.94% 29.76% 18 bps
JW Marriott Denver Cherry Creek $270.71 $248.52 8.9% 77.8% 81.7% (3.9)% $210.50 $203.16 3.6% 32.20% 31.46% 74 bps
Inn at Key West $247.13 $229.84 7.5% 92.4% 91.4% 1.0% $228.44 $210.12 8.7% 57.33% 59.21% -188 bps
Key West Sheraton Suites $273.42 $257.35 6.2% 96.7% 92.6% 4.1% $264.30 $238.34 10.9% 46.17% 42.54% 363 bps
Lexington Hotel New York $224.30 $225.90 (0.7)% 92.2% 87.5% 4.7% $206.81 $197.60 4.7% 24.86% 25.57% -71 bps
Hilton Minneapolis $141.89 $138.01 2.8% 75.3% 71.4% 3.9% $106.78 $98.48 8.4% 19.62% 21.57% -195 bps
Orlando Airport Marriott $126.62 $111.88 13.2% 82.7% 85.3% (2.6)% $104.73 $95.39 9.8% 33.92% 29.83% 409 bps
Hotel Rex $226.72 $188.90 20.0% 84.2% 83.7% 0.5% $190.82 $158.09 20.7% 33.65% 29.04% 461 bps
Salt Lake City Marriott $154.92 $144.34 7.3% 74.2% 68.7% 5.5% $114.92 $99.21 15.8% 34.07% 31.49% 258 bps
Shorebreak $216.55 $194.15 11.5% 80.3% 81.6% (1.3)% $173.95 $158.43 9.8% 26.81% 24.57% 224 bps
The Lodge at Sonoma $253.07 $240.46 5.2% 79.4% 72.7% 6.7% $200.87 $174.83 14.9% 25.60% 22.96% 264 bps
Hilton Garden Inn Times Square Central $230.42 N/A N/A 96.4% N/A N/A $222.03 N/A N/A 43.78% N/A N/A
Vail Marriott $307.06 $298.18 3.0% 71.8% 67.7% 4.1% $220.58 $201.73 9.3% 40.77% 39.42% 135 bps
Westin San Diego $186.76 $163.72 14.1% 83.8% 84.7% (0.9)% $156.55 $138.75 12.8% 34.24% 31.52% 272 bps
Westin Washington D.C. City Center $234.49 $210.80 11.2% 80.0% 69.0% 11.0% $187.68 $145.39 29.1% 36.32% 30.16% 616 bps
Renaissance Worthington $184.05 $178.05 3.4% 72.9% 71.0% 1.9% $134.25 $126.44 6.2% 37.99% 35.26% 273 bps
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Pro Forma Total (1) $212.01 $201.92 5.0% 79.8% 78.4% 1.4% $169.09 $158.26 6.8% 30.67% 29.13% 154 bps
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(1) Assumes all hotels were owned as of January 1, 2014 but excludes the Hilton Garden Inn Times Square Central (282 rooms), which opened for business on September 1, 2014.
Pro Forma Hotel Adjusted EBITDA Reconciliation
Second Quarter 2015
-------------------
Plus: Plus: Plus: Equals:
Total Revenues Net Income / (Loss) Depreciation Interest Expense Non-Cash Hotel Adjusted
Adjustments (1) EBITDA
-------------- ------
Atlanta Alpharetta Marriott $4,799 $1,254 $381 $ - $ - $1,635
Bethesda Marriott Suites $4,656 $(213) $367 $ - $1,541 $1,695
Boston Westin $26,231 $7,422 $2,210 $ - $3 $9,635
Hilton Boston Downtown $10,493 $3,624 $1,152 $ - $42 $4,818
Hilton Burlington $4,308 $1,327 $454 $ - $23 $1,804
Renaissance Charleston $4,026 $1,366 $393 $ - $(32) $1,727
Hilton Garden Inn Chelsea $3,740 $924 $362 $ - $ - $1,286
Chicago Marriott $32,040 $5,278 $2,545 $3,119 $(397) $10,545
Chicago Conrad $8,039 $2,289 $738 $ - $ - $3,027
Courtyard Denver Downtown $2,951 $1,174 $285 $ - $ - $1,459
Courtyard Fifth Avenue $4,507 $60 $448 $828 $52 $1,388
Courtyard Midtown East $8,041 $1,373 $684 $1,008 $ - $3,065
Fort Lauderdale Westin $10,560 $2,016 $1,129 $ - $ - $3,145
Frenchman's Reef $17,234 $2,390 $1,608 $374 $ - $4,372
JW Marriott Denver Cherry Creek $6,630 $1,332 $523 $554 $ - $2,409
Inn at Key West $2,177 $920 $174 $ - $ - $1,094
Key West Sheraton Suites $4,566 $1,318 $513 $ - $ - $1,831
Lexington Hotel New York $17,936 $2,080 $3,356 $1,293 $6 $6,735
Minneapolis Hilton $14,838 $705 $2,357 $1,291 $(202) $4,151
Orlando Airport Marriott $6,031 $110 $577 $801 $ - $1,488
Hotel Rex $1,952 $584 $142 $ - $ - $726
Salt Lake City Marriott $7,208 $983 $758 $675 $ - $2,416
Shorebreak $3,696 $703 $522 $ - $(15) $1,210
The Lodge at Sonoma $6,901 $1,684 $377 $304 $ - $2,365
Hilton Garden Inn Times Square Central $7,124 $2,738 $777 $ - $ - $3,515
Vail Marriott $4,679 $(108) $497 $ - $ - $389
Westin San Diego $8,520 $1,058 $1,018 $689 $46 $2,811
Westin Washington D.C. City Center $9,971 $2,348 $1,157 $743 $47 $4,295
Renaissance Worthington $10,447 $2,559 $585 $775 $2 $3,921
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Pro Forma Total (2) $247,177 $46,560 $25,312 $12,454 $1,116 $85,436
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(1) The non-cash adjustments include expenses incurred by the hotels due to the straight lining of the rent from ground lease obligations, the non-cash amortization of our favorable lease assets, and the non-cash amortization of our unfavorable contract liabilities.
(2) Assumes all hotels were owned as of January 1, 2014 but excludes the Hilton Garden Inn Times Square Central, which opened for business on September 1, 2014.
( )
Pro Forma Hotel Adjusted EBITDA Reconciliation
Second Quarter 2014
-------------------
Plus: Plus: Plus: Equals:
Total Revenues Net Income / (Loss) Depreciation Interest Expense Non-Cash Hotel Adjusted
Adjustments (1) EBITDA
-------------- ------
Atlanta Alpharetta Marriott $4,581 $1,219 $407 $ - $ - $1,626
Bethesda Marriott Suites $4,413 $(414) $360 $ - $1,541 $1,487
Boston Westin $25,514 $6,611 $2,191 $ - $2 $8,804
Hilton Boston Downtown $9,305 $2,833 $1,062 $ - $42 $3,937
Hilton Burlington $3,961 $1,225 $422 $ - $23 $1,670
Renaissance Charleston $4,075 $1,300 $408 $ - $(32) $1,676
Hilton Garden Inn Chelsea $3,766 $1,229 $492 $ - $ - $1,721
Chicago Marriott $29,534 $2,820 $3,255 $3,192 $(397) $8,870
Chicago Conrad $8,188 $2,322 $965 $ - $ - $3,287
Courtyard Denver Downtown $2,754 $1,137 $274 $ - $ - $1,411
Courtyard Fifth Avenue $4,543 $120 $439 $838 $52 $1,449
Courtyard Midtown East $8,318 $1,585 $685 $971 $ - $3,241
Fort Lauderdale Westin $10,894 $1,058 $1,095 $ - $ - $2,153
Frenchman's Reef $16,246 $1,240 $1,563 $810 $ - $3,613
JW Marriott Denver Cherry Creek $6,032 $922 $517 $572 $ - $2,011
Inn at Key West $1,962 $906 $162 $ - $ - $1,068
Key West Sheraton Suites $3,913 $875 $513 $ - $ - $1,388
Lexington Hotel New York $17,124 $1,473 $3,265 $1,732 $31 $6,501
Minneapolis Hilton $14,833 $1,108 $2,423 $1,321 $(129) $4,723
Orlando Airport Marriott $5,546 $(184) $599 $814 $ - $1,229
Hotel Rex $1,673 $372 $194 $ - $ - $566
Salt Lake City Marriott $6,759 $750 $745 $691 $ - $2,186
Shorebreak $3,648 $536 $465 $ - $ - $1,001
The Lodge at Sonoma $6,517 $1,415 $382 $310 $ - $2,107
Vail Marriott $4,101 $(201) $513 $ - $ - $312
Westin San Diego $7,446 $576 $1,097 $701 $46 $2,420
Westin Washington D.C. City Center $8,093 $1,042 $1,249 $761 $47 $3,099
Renaissance Worthington $9,557 $1,924 $643 $738 $2 $3,307
------ ------ ---- ---- --- ------
Pro Forma Total (2) $233,296 $35,799 $26,385 $13,451 $1,228 $76,755
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(1) The non-cash adjustments include expenses incurred by the hotels due to the straight lining of the rent from ground lease obligations, the non-cash amortization of our favorable lease assets and the non-cash amortization of our unfavorable contract liabilities.
(2) Assumes all hotels were owned as of January 1, 2014 but excludes the Hilton Garden Inn Times Square Central, which opened for business on September 1, 2014.
Pro Forma Hotel Adjusted EBITDA Reconciliation
Year to Date 2015
-----------------
Plus: Plus: Plus: Equals:
Total Revenues Net Income / (Loss) Depreciation Interest Expense Non-Cash Hotel Adjusted
Adjustments (1) EBITDA
-------------- ------
Atlanta Alpharetta Marriott $9,663 $2,618 $774 $ - $ - $3,392
Bethesda Marriott Suites $7,981 $(1,474) $755 $ - $3,083 $2,364
Boston Westin $46,325 $9,268 $4,456 $ - $4 $13,728
Hilton Boston Downtown $15,753 $3,259 $2,237 $ - $84 $5,580
Hilton Burlington $6,938 $1,410 $906 $ - $45 $2,361
Renaissance Charleston $7,176 $1,959 $784 $ - $(63) $2,680
Hilton Garden Inn Chelsea $5,995 $783 $724 $ - $ - $1,507
Chicago Marriott $48,139 $401 $4,108 $6,255 $(795) $9,969
Chicago Conrad $12,097 $1,257 $1,606 $ - $ - $2,863
Courtyard Denver Downtown $5,379 $1,929 $567 $ - $ - $2,496
Courtyard Fifth Avenue $7,500 $(1,252) $897 $1,649 $103 $1,397
Courtyard Midtown East $13,343 $306 $1,369 $2,006 $ - $3,681
Fort Lauderdale Westin $25,715 $7,171 $2,256 $ - $ - $9,427
Frenchman's Reef $38,304 $7,126 $3,178 $1,164 $ - $11,468
JW Marriott Denver Cherry Creek $12,268 $1,786 $1,052 $1,112 $ - $3,950
Inn at Key West $5,036 $2,541 $346 $ - $ - $2,887
Key West Sheraton Suites $10,423 $3,786 $1,026 $ - $ - $4,812
Lexington Hotel New York $29,259 $(2,111) $6,685 $2,663 $37 $7,274
Minneapolis Hilton $24,607 $(2,048) $4,703 $2,576 $(404) $4,827
Orlando Airport Marriott $14,714 $2,256 $1,138 $1,597 $ - $4,991
Hotel Rex $3,667 $950 $284 $ - $ - $1,234
Salt Lake City Marriott $14,643 $2,148 $1,495 $1,346 $ - $4,989
Shorebreak $6,950 $1,136 $756 $ - $(29) $1,863
The Lodge at Sonoma $12,354 $1,803 $753 $607 $ - $3,163
Hilton Garden Inn Times Square Central $11,556 $3,505 $1,554 $ - $ - $5,059
Vail Marriott $19,260 $6,871 $982 $ - $ - $7,853
Westin San Diego $17,569 $2,518 $2,033 $1,373 $91 $6,015
Westin Washington D.C. City Center $16,822 $2,185 $2,347 $1,483 $95 $6,110
Renaissance Worthington $20,872 $5,266 $1,165 $1,495 $4 $7,930
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Pro Forma Total (2) $458,752 $63,848 $49,382 $25,326 $2,255 $140,700
======== ======= ======= ======= ====== ========
(1) The non-cash adjustments include expenses incurred by the hotels due to the straight lining of the rent from ground lease obligations, the non-cash amortization of our favorable lease assets, and the non-cash amortization of our unfavorable contract liabilities.
(2) Assumes all hotels were owned as of January 1, 2014 but excludes the Hilton Garden Inn Times Square Central, which opened for business on September 1, 2014.
( )
Pro Forma Hotel Adjusted EBITDA Reconciliation
Year to Date 2014
-----------------
Plus: Plus: Plus: Equals:
Total Revenues Net Income / (Loss) Depreciation Interest Expense Non-Cash Hotel Adjusted
Adjustments (1) EBITDA
-------------- ------
Atlanta Alpharetta Marriott $9,164 $2,425 $810 $ - $ - $3,235
Bethesda Marriott Suites $7,564 $(1,774) $723 $ - $3,091 $2,040
Boston Westin $41,898 $6,460 $4,386 $ - $4 $10,850
Hilton Boston Downtown $14,764 $2,690 $2,173 $ - $84 $4,947
Hilton Burlington $6,374 $1,296 $873 $ - $45 $2,214
Renaissance Charleston $7,036 $1,803 $806 $ - $(63) $2,546
Hilton Garden Inn Chelsea $6,302 $1,428 $983 $ - $ - $2,411
Chicago Marriott $45,991 $(2,830) $6,370 $6,364 $(794) $9,110
Chicago Conrad $12,751 $1,599 $1,915 $ - $ - $3,514
Courtyard Denver Downtown $5,161 $1,902 $545 $ - $ - $2,447
Courtyard Fifth Avenue $7,662 $(1,056) $869 $1,670 $103 $1,586
Courtyard Midtown East $13,987 $954 $1,375 $1,945 $ - $4,274
Fort Lauderdale Westin $25,589 $5,086 $2,190 $ - $ - $7,276
Frenchman's Reef $38,594 $6,794 $3,077 $1,615 $ - $11,486
JW Marriott Denver Cherry Creek $11,249 $1,359 $1,031 $1,149 $ - $3,539
Inn at Key West $4,469 $2,322 $324 $ - $ - $2,646
Key West Sheraton Suites $9,259 $2,913 $1,026 $ - $ - $3,939
Lexington Hotel New York $27,787 $(2,943) $6,526 $3,460 $63 $7,106
Minneapolis Hilton $23,474 $(1,977) $4,663 $2,636 $(258) $5,064
Orlando Airport Marriott $12,507 $883 $1,226 $1,622 $ - $3,731
Hotel Rex $3,096 $484 $415 $ - $ - $899
Salt Lake City Marriott $13,753 $1,449 $1,505 $1,377 $ - $4,331
Shorebreak $6,789 $738 $930 $ - $ - $1,668
The Lodge at Sonoma $10,321 $988 $764 $618 $ - $2,370
Vail Marriott $17,588 $5,894 $1,040 $ - $ - $6,934
Westin San Diego $14,719 $966 $2,185 $1,398 $91 $4,640
Westin Washington D.C. City Center $13,350 $48 $2,364 $1,519 $95 $4,026
Renaissance Worthington $19,067 $3,959 $1,288 $1,472 $4 $6,723
------- ------ ------ ------ --- ------
Pro Forma Total (2) $430,265 $43,860 $52,382 $26,845 $2,465 $125,317
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(1) The non-cash adjustments include expenses incurred by the hotels due to the straight lining of the rent from ground lease obligations, the non-cash amortization of our favorable lease assets and the non-cash amortization of our unfavorable contract liabilities.
(2) Assumes all hotels were owned as of January 1, 2014 but excludes the Hilton Garden Inn Times Square Central, which opened for business on September 1, 2014.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/diamondrock-hospitality-company-reports-second-quarter-2015-results-and-increases-full-year-guidance-to-reflect-key-west-acquisition-300125398.html
SOURCE DiamondRock Hospitality Company
