LaSalle Hotel Properties Reports Fourth Quarter and Full Year 2012 Results
LaSalle Hotel Properties Reports Fourth Quarter and Full Year 2012 Results
Full year hotel EBITDA margin increased 113 basis points to Company’s
highest-ever reported margin of 32.1 percent
Company also reports highest-ever full year ADR, occupancy and RevPAR
Business Wire
BETHESDA, Md. -- February 20, 2013
LaSalle Hotel Properties (NYSE: LHO) today announced results for the fourth
quarter and year ended December 31, 2012. The Company’s results include the
following:
Fourth Quarter Year-to-Date
2012 2011 2012 2011
($'s in millions except per share/unit data)
Total Revenue $ 215.7 $ 179.0 $ 867.1 $ 719.0
Net income to common $ 10.0 $ 0.6 $ 45.1 $ 12.9
shareholders
Net income to common
shareholders per $ 0.11 $ 0.01 $ 0.52 $ 0.16
diluted share
EBITDA^(1) $ 62.3 $ 47.1 $ 253.5 $ 201.0
Adjusted EBITDA^(1) $ 62.2 $ 49.2 $ 263.2 $ 204.4
FFO^(1) $ 41.4 $ 28.2 $ 169.6 $ 123.3
Adjusted FFO^(1) $ 41.3 $ 30.3 $ 179.3 $ 127.7
FFO per diluted $ 0.47 $ 0.34 $ 1.97 $ 1.52
share/unit^(1)
Adjusted FFO per $ 0.47 $ 0.36 $ 2.08 $ 1.57
diluted share/unit^(1)
RevPAR $ 154.88 $ 149.25 $ 160.38 $ 153.39
RevPAR growth 3.8 % 4.6 %
Hotel EBITDA Margin 30.6 % 30.7 % 32.1 % 31.0 %
Hotel EBITDA Margin -17 bps 113 bps
growth
^(1) See tables later in press release, which list adjustments that reconcile
net income to earnings before interest, taxes, depreciation and amortization
("EBITDA"), adjusted EBITDA, funds from operations ("FFO"), FFO per
share/unit, adjusted FFO, adjusted FFO per share/unit and hotel EBITDA.
EBITDA, adjusted EBITDA, FFO, FFO per share/unit, adjusted FFO, adjusted FFO
per share/unit and hotel EBITDA are non-GAAP financial measures. See further
discussion of these non-GAAP measures and reconciliations to net income later
in this press release.
Fourth Quarter Highlights
* RevPAR: Room revenue per available room (“RevPAR”) for the quarter ended
December 31, 2012 increased 3.8 percent to $154.88, as a result of a 3.4
percent increase in average daily rate (“ADR”) to $209.06 and a 0.3
percent increase in occupancy to 74.1 percent.
* RevPAR excluding Washington, DC: Excluding Washington, DC, RevPAR during
the fourth quarter increased 5.8 percent, comprised of a 4.9 percent
improvement in ADR and a 0.9 percent increase in occupancy.
* Hotel EBITDA Margin: The Company’s hotel EBITDA margin for the fourth
quarter was 30.6 percent.
* Adjusted EBITDA: The Company’s adjusted EBITDA was $62.2 million, an
increase of 26.3 percent over the fourth quarter of 2011.
* Adjusted FFO: The Company generated fourth quarter adjusted FFO of $41.3
million, or $0.47 per diluted share/unit, compared to $30.3 million or
$0.36 per diluted share/unit for the comparable prior year period.
Adjusted FFO per share/unit increased 30.6 percent.
* Acquisitions: The Company acquired L’Auberge Del Mar in Del Mar,
California for $76.9 million. The Company also acquired a majority
interest in The Liberty Hotel in Boston, Massachusetts through a joint
venture with the original developer and co-owner, an entity controlled by
Dick Friedman of Carpenter & Company, Inc. The total value of the Liberty
transaction was $170.0 million.
* Capital Markets: On December 19, 2012, the Company sold 9,200,000 common
shares of beneficial interest, including the full exercise of the
underwriters’ option to purchase additional shares, at a price to the
public of $23.70 per share. The majority of the offering’s $209.1 million
of net proceeds were used to acquire a majority interest in The Liberty
Hotel.
* Capital Investments: The Company invested $19.0 million of capital in its
hotels, including the commencement of the renovation of the Park Central
Hotel and WestHouse in Manhattan and Hotel Monaco San Francisco.
* Dividends: On December 14, 2012, the Company declared a fourth quarter
2012 dividend of $0.20 per common share of beneficial interest.
* Election of Board Member: The Company announced that Denise Coll has been
elected to the Company’s Board of Trustees, effective March 2, 2013.
“We are very proud of our accomplishments during the fourth quarter and for
the entire year 2012,” said Michael D. Barnello, President and Chief Executive
Officer of LaSalle Hotel Properties. “Our portfolio delivered another year of
outstanding performance, setting portfolio records in average daily rate,
occupancy, RevPAR and hotel EBITDA margins, resulting in substantial adjusted
corporate EBITDA and adjusted FFO per share growth.”
“We’ve continued to improve our already high-quality portfolio with
acquisitions in key markets and by commencing value-creating projects like the
work we are doing at Park Central and WestHouse in New York City.”
“Furthermore, we have substantially reduced our cost of debt from 5.2 percent
in 2011 to 4.3 percent in 2012 by executing on two term loans with very
attractive interest rates.”
Full Year 2012 Highlights
* RevPAR: RevPAR increased 4.6 percent to $160.38, as a result of a 4.0
percent increase in ADR to $202.82 and a 0.5 percent increase in occupancy
to 79.1 percent. In 2012, the Company achieved its highest-ever reported
ADR and RevPAR, while achieving its highest-ever reported occupancy for
the second year in a row.
* RevPAR excluding Washington, DC: Excluding Washington, DC, RevPAR for 2012
increased 6.0 percent, comprised of a 5.3 percent improvement in ADR and a
0.7 percent increase in occupancy.
* Hotel EBITDA Margin: The Company’s hotel EBITDA margin was 32.1 percent,
which was its highest-ever reported margin and represents an improvement
of 113 basis points compared to 2011.
* Adjusted EBITDA: The Company’s adjusted EBITDA was $263.2 million, an
increase of 28.8 percent over 2011.
* Adjusted FFO: The Company generated adjusted FFO of $179.3 million, or
$2.08 per diluted share/unit, compared to $127.7 million or $1.57 per
diluted share/unit during 2011. Adjusted FFO per share/unit increased 32.5
percent.
* Acquisitions: The Company invested $458.1 million to acquire three
properties and the mezzanine loan secured by two Santa Monica, California
hotels during 2012 bringing the three-year acquisition investment total to
$1.5 billion. The 2012 acquisitions include the following:
* Hotel Palomar in Washington, DC for $143.8 million on March 8;
* The mezzanine loan secured by Shutters on the Beach and Hotel Casa
Del Mar in Santa Monica, California for $67.4 million on July 13. The
Company purchased the debt instrument for 93.6 percent of the $72.0
million face value of the loan;
* L’Auberge Del Mar in Del Mar, California for $76.9 million on
December 6; and
* The majority interest in The Liberty Hotel in Boston, Massachusetts
in a transaction valued at $170.0 million on December 28.
* Capital Markets: The Company completed several capital markets initiatives
during 2012 including the following:
* Throughout 2012, the Company sold 2,359,108 common shares under its
ATM program at an average net price of $27.11 per share for net
proceeds of $64.0 million;
* On March 30, 2012, the Company retired $59.6 million of mortgage debt
secured by Hilton San Diego Gaslamp Quarter using proceeds from its
senior unsecured credit facility;
* On May 16, 2012, the Company entered into a new $177.5 million
unsecured loan with a seven-year term maturing on May 16, 2019. The
term loan was swapped to a fixed interest rate for the full
seven-year term. The term loan’s interest rate will be 3.87 percent
when the Company’s leverage ratio is between 4.0 and 4.75 times;
* On May 21, 2012, the Company redeemed all 7.5% Series D Cumulative
Redeemable Preferred Shares and 8.0% Series E Cumulative Redeemable
Preferred Shares. Total combined redemption value for the Series D
and E Preferred Shares was approximately $166.8 million; and
* On August 2, 2012, the Company entered into a new $300.0 million
unsecured loan with a five-year term maturing on August 2, 2017,
including a one-year extension subject to certain conditions. The
term loan was swapped to a fixed interest rate for the full five-year
term. The term loan's interest rate will be 2.68 percent when the
Company's leverage ratio is between 4.0 and 4.75 times.
* On December 19, 2012, the Company sold 9,200,000 common shares of
beneficial interest, including the full exercise of the underwriters’
option to purchase additional shares, at a price to the public of
$23.70 per share, resulting in net proceeds of $209.1 million.
* The Company’s cost of debt was reduced from 5.2 percent in 2011 to
4.3 percent in 2012. Also, the cost of debt and preferred was reduced
from 6.0 percent in 2011 to 4.9 percent in 2012.
* Capital Investments: The Company invested $67.9 million of capital in its
hotels throughout the year, completing the 33-room expansion and
renovation of Hotel Amarano Burbank and the renovations of The Liaison
Capitol Hill in Washington, DC, Le Parc Suite Hotel and Le Montrose Suite
Hotel in West Hollywood and The Hotel Roger Williams in New York. The
Company’s capital investments also include the commencement of the
renovation of the Park Central Hotel and WestHouse in Manhattan and Hotel
Monaco San Francisco.
Balance Sheet
As of December 31, 2012, the Company had total outstanding debt of $1.25
billion, including $153.0 million outstanding on its senior unsecured credit
facility. Total net debt to trailing 12 month Corporate EBITDA (as defined in
the Company’s senior unsecured credit facility) was 4.2 times as of December
31, 2012 and its fixed charge coverage ratio was 3.0 times. For the fourth
quarter, the Company’s weighted average interest rate was 4.3 percent. As of
December 31, 2012, the Company had $52.5 million of cash and cash equivalents
on its balance sheet and capacity of $619.7 million available on its credit
facilities.
Subsequent Events
On February 20, 2013, the Company entered into an Equity Distribution
Agreement with Raymond James & Associates, Inc. to establish a new
at-the-market (“ATM”) program totaling $250.0 million. The new ATM program
replaces the previous $250.0 million program, of which $146.0 million
remained.
2013 Outlook
The Company is providing its 2013 outlook based on an economic environment
that continues to improve and assuming no acquisitions and no capital markets
activities. The Company’s RevPAR growth and financial expectations for 2013
are as follows:
Current Outlook
Low-end High-end
($'s in millions except per share/unit data)
Excluding Park Central
Hotel
RevPAR growth 3.0% 6.0%
Hotel EBITDA Margins 31.4% 32.4%
Hotel EBITDA Margin Change 0 bps 100 bps
Including Park Central
Hotel
RevPAR growth 0.0% 3.0%
Hotel EBITDA Margins 31.5% 32.5%
Hotel EBITDA Margin Change -50 bps 50 bps
Entire Portfolio (Including
Park Central Hotel)
Adjusted EBITDA $ 275.0 $ 295.0
Adjusted FFO $ 195.0 $ 214.0
Adjusted FFO per diluted $ 2.03 $ 2.23
share/unit
Income Tax Expenses $ 4.5 $ 5.5
Capital Investments
Portfolio Excluding Park $ 70.0 $ 75.0
Central
Park Central $ 60.0 $ 70.0
Portfolio Including Park $ 130.0 $ 145.0
Central
2013 First Quarter Outlook
Based on the portfolio’s performance quarter-to-date, the Company expects
first quarter RevPAR, excluding the Park Central Hotel to increase 4.0 percent
to 6.0 percent. The Company expects its portfolio, including the Park Central
Hotel to generate adjusted EBITDA of $37.0 million to $39.0 million and
adjusted FFO per share/unit of $0.24 to $0.26.
Earnings Call
The Company will conduct its quarterly conference call on Thursday, February
21, 2013 at 8:30 AM EST. To participate in the conference call, please dial
(888) 466-4587. Additionally, a live webcast of the conference call will be
available through the Company’s website. To access, log on to
http://www.lasallehotels.com. A replay of the conference call will be archived
and available online through the Investor Relations section of
http://www.lasallehotels.com.
LaSalle Hotel Properties is a leading multi-operator real estate investment
trust. The Company owns 40 hotels and a mezzanine loan secured by two hotels
in Santa Monica, CA. The properties are upscale, full-service hotels, totaling
more than 10,600 guest rooms in 13 markets in 9 states and the District of
Columbia. The Company focuses on owning, redeveloping and repositioning
upscale, full-service hotels located in urban, resort and convention markets.
LaSalle Hotel Properties seeks to grow through strategic relationships with
premier lodging companies, including Westin Hotels and Resorts, Hilton Hotels
Corporation, Outrigger Lodging Services, Noble House Hotels & Resorts, Hyatt
Hotels Corporation, Benchmark Hospitality, White Lodging Services Corporation,
Thompson Hotels, Davidson Hotel Company, Denihan Hospitality Group, the
Kimpton Hotel & Restaurant Group, LLC, Accor, Destination Hotels & Resorts,
HEI Hotels & Resorts, JRK Hotel Group, Inc., Viceroy Hotel Group, Highgate
Hotels and Access Hotels & Resorts.
This press release, together with other statements and information publicly
disseminated by the Company, contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. The
Company intends such forward-looking statements to be covered by the safe
harbor provisions for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995 and includes this statement for
purposes of complying with these safe harbor provisions. Forward-looking
statements, which are based on certain assumptions and describe the Company's
future plans, strategies and expectations, are generally identifiable by use
of the words “will,” "believe," "expect," "intend," "anticipate," "estimate,"
"project" or similar expressions. Forward-looking statements in this press
release include, among others, statements about outlook for RevPAR, adjusted
FFO, adjusted EBITDA, hotel EBITDA margins and derivations thereof and the
Company’s outlook for capital investments. You should not rely on
forward-looking statements since they involve known and unknown risks,
uncertainties and other factors that are, in some cases, beyond the Company's
control and which could materially affect actual results, performances or
achievements. Factors that may cause actual results to differ materially from
current expectations include, but are not limited to, (i) the Company’s
dependence on third-party managers of its hotels, including its inability to
implement strategic business decisions directly, (ii) risks associated with
the hotel industry, including competition, increases in wages, energy costs
and other operating costs, actual or threatened terrorist attacks, downturns
in general and local economic conditions and cancellation of or delays in the
completion of anticipated demand generators, (iii) the availability and terms
of financing and capital and the general volatility of securities markets,
(iv) risks associated with the real estate industry, including environmental
contamination and costs of complying with the Americans with Disabilities Act
and similar laws, (v) interest rate increases, (vi) the possible failure of
the Company to qualify as a REIT and the risk of changes in laws affecting
REITs, (vii) the possibility of uninsured losses, (viii) risks associated with
redevelopment and repositioning projects, including delays and cost overruns
and (ix) the risk factors discussed in the Company’s Annual Report on Form
10-K as updated in its Quarterly Reports. Accordingly, there is no assurance
that the Company's expectations will be realized. Except as otherwise required
by the federal securities laws, the Company disclaims any obligation or
undertaking to publicly release any updates or revisions to any
forward-looking statement contained herein (or elsewhere) to reflect any
change in the Company’s expectations with regard thereto or any change in
events, conditions or circumstances on which any such statement is based.
For additional information or to receive press releases via e-mail, please
visit our website at www.lasallehotels.com.
LASALLE HOTEL PROPERTIES
Consolidated Statements of Operations and Comprehensive Income
(in thousands, except share data)
(unaudited)
For the three months ended For the year ended
December 31, December 31,
2012 2011 2012 2011
Revenues:
Hotel operating
revenues:
Room $ 146,015 $ 114,953 $ 595,330 $ 471,023
Food and beverage 54,008 50,333 210,306 193,332
Other operating 14,405 12,276 56,510 49,650
department
Total hotel operating 214,428 177,562 862,146 714,005
revenues
Other income 1,236 1,417 4,929 5,002
Total revenues 215,664 178,979 867,075 719,007
Expenses:
Hotel operating
expenses:
Room 38,361 28,946 150,564 115,839
Food and beverage 38,406 34,589 149,894 133,838
Other direct 4,935 4,653 20,778 20,390
Other indirect 54,276 46,306 212,001 182,771
Total hotel operating 135,978 114,494 533,237 452,838
expenses
Depreciation and 31,452 27,710 124,363 111,282
amortization
Real estate taxes,
personal property 11,621 8,955 44,551 35,425
taxes and insurance
Ground rent 1,975 1,859 8,588 7,720
General and 5,134 4,201 19,769 17,120
administrative
Acquisition 441 1,997 4,498 2,571
transaction costs
Other expenses 626 778 3,017 2,527
Total operating 187,227 159,994 738,023 629,483
expenses
Operating income 28,437 18,985 129,052 89,524
Interest income 2,397 26 4,483 48
Interest expense (14,505 ) (10,138 ) (52,896 ) (39,704 )
Income before income
tax expense and 16,329 8,873 80,639 49,868
discontinued
operations
Income tax expense (2,142 ) (1,378 ) (9,062 ) (7,048 )
Income from 14,187 7,495 71,577 42,820
continuing operations
Discontinued
operations:
Income from
operations of
properties disposed 0 388 0 829
of, including gain on
sale
Income tax benefit 0 79 0 (33 )
(expense)
Net income from
discontinued 0 467 0 796
operations
Net income 14,187 7,962 71,577 43,616
Noncontrolling
interests:
Redeemable
noncontrolling 0 0 0 2
interest in loss of
consolidated entity
Noncontrolling
interests of common (57 ) (1 ) (281 ) (1 )
units in Operating
Partnership
Net (income) loss
attributable to (57 ) (1 ) (281 ) 1
noncontrolling
interests
Net income
attributable to the 14,130 7,961 71,296 43,617
Company
Distributions to
preferred (4,166 ) (7,402 ) (21,733 ) (29,952 )
shareholders
Issuance costs of
redeemed preferred 0 0 (4,417 ) (731 )
shares
Net income
attributable to $ 9,964 $ 559 $ 45,146 $ 12,934
common shareholders
LASALLE HOTEL PROPERTIES
Consolidated Statements of Operations and Comprehensive Income - Continued
(in thousands, except share data)
(unaudited)
For the three months ended For the year ended
December 31, December 31,
2012 2011 2012 2011
Earnings per
Common Share -
Basic:
Net income
attributable to
common
shareholders
before
discontinued $ 0.11 $ 0.00 $ 0.52 $ 0.15
operations and
excluding amounts
attributable to
unvested
restricted shares
Discontinued 0.00 0.01 0.00 0.01
operations
Net income
attributable to
common
shareholders $ 0.11 $ 0.01 $ 0.52 $ 0.16
excluding amounts
attributable to
unvested
restricted shares
Earnings per
Common Share -
Diluted:
Net income
attributable to
common
shareholders
before
discontinued $ 0.11 $ 0.00 $ 0.52 $ 0.15
operations and
excluding amounts
attributable to
unvested
restricted shares
Discontinued 0.00 0.01 0.00 0.01
operations
Net income
attributable to
common
shareholders $ 0.11 $ 0.01 $ 0.52 $ 0.16
excluding amounts
attributable to
unvested
restricted shares
Weighted average
number of common
shares
outstanding:
Basic 87,186,328 83,417,987 85,757,969 81,155,228
Diluted 87,325,471 83,530,710 85,897,274 81,326,304
Comprehensive
Income:
Net income $ 14,187 $ 7,962 $ 71,577 $ 43,616
Other
comprehensive
income (loss):
Unrealized income
(loss) on interest 775 0 (7,759 ) 0
rate derivative
instruments
Comprehensive 14,962 7,962 63,818 43,616
income
Noncontrolling
interests:
Redeemable
noncontrolling
interest in loss 0 0 0 2
of consolidated
entity
Noncontrolling
interests of
common units in (62 ) (1 ) (257 ) (1 )
Operating
Partnership
Comprehensive
income
attributable to (62 ) (1 ) (257 ) 1
noncontrolling
interests
Comprehensive
income $ 14,900 $ 7,961 $ 63,561 $ 43,617
attributable to
the Company
LASALLE HOTEL PROPERTIES
FFO and EBITDA
(in thousands, except share/unit data)
(unaudited)
For the three months ended For the year ended
December 31, December 31,
2012 2011 2012 2011
Net income
attributable to $ 9,964 $ 559 $ 45,146 $ 12,934
common
shareholders
Depreciation 31,326 27,566 123,809 110,760
Amortization of
deferred lease 100 93 371 318
costs
Noncontrolling
interests:
Redeemable
noncontrolling
interest in 0 0 0 (2 )
consolidated
entity
Noncontrolling
interests of
common units in 57 1 281 1
Operating
Partnership
Less: Net gain on 0 0 0 (760 )
sale of property
FFO $ 41,447 $ 28,219 $ 169,607 $ 123,251
Management
transition and (93 ) 0 1,447 579
severance costs
Preferred share 0 0 4,417 731
issuance costs
Acquisition 441 1,997 4,498 2,571
transaction costs
Tax adjustment
related to 0 0 0 244
disposition
Non-cash ground 112 115 454 347
rent
Mezzanine loan
discount (583 ) 0 (1,074 ) 0
amortization
Adjusted FFO $ 41,324 $ 30,331 $ 179,349 $ 127,723
Weighted Average
number of common
shares and units
outstanding:
Basic 87,482,628 83,427,649 86,054,269 81,157,663
Diluted 87,621,771 83,540,372 86,193,574 81,328,739
FFO per diluted $ 0.47 $ 0.34 $ 1.97 $ 1.52
share/unit
Adjusted FFO per $ 0.47 $ 0.36 $ 2.08 $ 1.57
diluted share/unit
For the three months ended For the year ended
December 31, December 31,
2012 2011 2012 2011
Net income
attributable to $ 9,964 $ 559 $ 45,146 $ 12,934
common
shareholders
Interest expense 14,505 10,138 52,896 39,704
Income tax expense 2,142 1,299 9,062 7,081
^(1)
Depreciation and 31,452 27,710 124,363 111,282
amortization
Noncontrolling
interests:
Redeemable
noncontrolling
interest in 0 0 0 (2 )
consolidated
entity
Noncontrolling
interests of
common units in 57 1 281 1
Operating
Partnership
Distributions to
preferred 4,166 7,402 21,733 29,952
shareholders
EBITDA $ 62,286 $ 47,109 $ 253,481 $ 200,952
Management
transition and (93 ) 0 1,447 579
severance costs
Preferred share 0 0 4,417 731
issuance costs
Acquisition 441 1,997 4,498 2,571
transaction costs
Net gain on sale 0 0 0 (760 )
of property
Non-cash ground 112 115 454 347
rent
Mezzanine loan
discount (583 ) 0 (1,074 ) 0
amortization
Adjusted EBITDA $ 62,163 $ 49,221 $ 263,223 $ 204,420
Corporate expense 6,618 4,823 23,622 19,792
Interest and other (3,526 ) (1,442 ) (9,212 ) (5,093 )
income
Hotel level (806 ) 10,952 (2,818 ) 37,665
adjustments, net
Hotel EBITDA $ 64,449 $ 63,554 $ 274,815 $ 256,784
^(1) Includes amounts from discontinued operations.
With respect to Hotel EBITDA, the Company believes that excluding the effect
of corporate-level expenses, non-cash items, and the portion of these items
related to unconsolidated entities, provides a more complete understanding of
the operating results over which individual hotels and operators have direct
control. We believe property-level results provide investors with supplemental
information on the ongoing operational performance of our hotels and
effectiveness of the third-party management companies operating our business
on a property-level basis.
Hotel EBITDA includes all properties owned as of December 31, 2012 for the
Company's period of ownership in 2012 and the comparable period in 2011.
Exceptions: Hotel EBITDA excludes March period of ownership for Hotel Palomar,
Washington, DC and partial December ownership of L'Auberge Del Mar and The
Liberty Hotel. Hotel EBITDA for all stated periods excludes any properties the
Company has sold.
LASALLE HOTEL PROPERTIES
Hotel Operational Data
Schedule of Property Level Results
(in thousands)
(unaudited)
For the three months ended For the year ended
December 31, December 31,
2012 2011 2012 2011
Revenues:
Room $ 145,209 $ 139,405 $ 592,785 $ 563,856
Food and beverage 53,138 53,717 208,935 211,577
Other 12,473 13,646 53,629 52,926
Total hotel revenues 210,820 206,768 855,349 828,359
Expenses:
Room 38,157 35,608 149,772 143,725
Food and beverage 37,815 37,629 148,892 149,832
Other direct 4,503 4,668 20,195 20,877
General and 17,332 17,076 66,862 65,744
administrative
Sales and marketing 13,565 13,624 56,109 54,432
Management fees 7,802 7,305 29,192 28,342
Property operations and 7,585 7,473 30,532 30,103
maintenance
Energy and utilities 5,572 6,739 23,442 25,231
Property taxes 10,514 9,590 40,491 39,135
Other fixed expenses 3,526 3,502 15,047 14,154
Total hotel expenses 146,371 143,214 580,534 571,575
Hotel EBITDA $ 64,449 $ 63,554 $ 274,815 $ 256,784
Note:
This schedule includes operating data for all properties owned as of
December 31, 2012 for the Company's period of ownership in 2012 and the
comparable period in 2011. Exceptions: The schedule excludes the March period
of ownership for Hotel Palomar, Washington, DC and partial December ownership
of L'Auberge Del Mar and The Liberty Hotel. All stated periods exclude any
properties the Company has sold. Hotel EBITDA margin is calculated by dividing
hotel EBITDA for the period by the total hotel revenues for the period.
LASALLE HOTEL PROPERTIES
Statistical Data for the Hotels
(unaudited)
For the three months ended For the year ended
December 31, December 31,
2012 2011 2012 2011
Total Portfolio
Occupancy 74.1 % 73.8 % 79.1 % 78.7 %
Increase 0.3 % 0.5 %
ADR $ 209.06 $ 202.11 $ 202.82 $ 194.94
Increase 3.4 % 4.0 %
RevPAR $ 154.88 $ 149.25 $ 160.38 $ 153.39
Increase 3.8 % 4.6 %
Note:
This schedule includes operating data for all properties owned as of
December 31, 2012 for the Company's period of ownership in 2012 and the
comparable period in 2011. All stated periods exclude any properties the
Company has sold.
LASALLE HOTEL PROPERTIES
Statistical Data for the Hotels
(unaudited)
Prior Year Operating Data Including Park Central Hotel
First Quarter Second Third Fourth Full Year
Quarter Quarter Quarter
2012 2012 2012 2012 2012
Occupancy 72.0 % 83.9 % 86.4 % 74.3 % 79.2 %
ADR $ 179.19 $ 219.00 $ 208.84 $ 212.87 $ 205.78
RevPAR $ 128.95 $ 183.69 $ 180.42 $ 158.24 $ 162.89
Prior Year Operating Data Excluding Park Central Hotel
First Quarter Second Third Fourth Full Year
Quarter Quarter Quarter
2012 2012 2012 2012 2012
Occupancy 69.7 % 82.6 % 85.4 % 72.3 % 77.5 %
ADR $ 183.73 $ 216.69 $ 207.59 $ 204.45 $ 203.95
RevPAR $ 128.10 $ 179.00 $ 177.28 $ 147.90 $ 158.12
Note:
The schedules above include operating data for all properties owned as of
December 31, 2012, unless otherwise noted.
Non-GAAP Financial Measures
FFO, EBITDA and Hotel EBITDA
The Company considers the non-GAAP measures of FFO (including FFO per
share/unit), EBITDA and hotel EBITDA to be key supplemental measures of the
Company's performance and should be considered along with, but not as
alternatives to, net income or loss as a measure of the Company's operating
performance. Historical cost accounting for real estate assets implicitly
assumes that the value of real estate assets diminishes predictably over time.
Since real estate values instead have historically risen or fallen with market
conditions, most real estate industry investors consider FFO, EBITDA and hotel
EBITDA to be helpful in evaluating a real estate company's operations.
The White Paper on FFO approved by NAREIT in April 2002, as revised in 2011,
defines FFO as net income or loss (computed in accordance with GAAP),
excluding gains or losses from sales of properties, impairment write-downs and
items classified by GAAP as extraordinary, plus real estate-related
depreciation and amortization (excluding amortization of deferred finance
costs) and after comparable adjustments for the Company's portion of these
items related to unconsolidated entities and joint ventures. The Company
computes FFO consistent with standards established by NAREIT, which may not be
comparable to FFO reported by other REITs that do not define the term in
accordance with the current NAREIT definition or that interpret the current
NAREIT definition differently than the Company.
With respect to FFO, the Company believes that excluding the effect of
extraordinary items, real estate-related depreciation and amortization, and
the portion of these items related to unconsolidated entities, all of which
are based on historical cost accounting and which may be of limited
significance in evaluating current performance, can facilitate comparisons of
operating performance between periods and between REITs, even though FFO does
not represent an amount that accrues directly to common shareholders. However,
FFO may not be helpful when comparing the Company to non-REITs.
With respect to EBITDA, the Company believes that excluding the effect of
non-operating expenses and non-cash charges, and the portion of these items
related to unconsolidated entities, all of which are also based on historical
cost accounting and may be of limited significance in evaluating current
performance, can help eliminate the accounting effects of depreciation and
amortization, and financing decisions and facilitate comparisons of core
operating profitability between periods and between REITs, even though EBITDA
also does not represent an amount that accrues directly to common
shareholders.
With respect to hotel EBITDA, the Company believes that excluding the effect
of corporate-level expenses, non-cash items, and the portion of these items
related to unconsolidated entities, provides a more complete understanding of
the operating results over which individual hotels and operators have direct
control. We believe property-level results provide investors with supplemental
information on the ongoing operational performance of our hotels and
effectiveness of the third-party management companies operating our business
on a property-level basis.
FFO, EBITDA and hotel EBITDA do not represent cash generated from operating
activities as determined by GAAP and should not be considered as alternatives
to net income or loss, cash flows from operations or any other operating
performance measure prescribed by GAAP. FFO, EBITDA and hotel EBITDA are not
measures of the Company's liquidity, nor are FFO, EBITDA and hotel EBITDA
indicative of funds available to fund the Company's cash needs, including its
ability to make cash distributions. These measurements do not reflect cash
expenditures for long-term assets and other items that have been and will be
incurred. FFO, EBITDA and hotel EBITDA may include funds that may not be
available for management's discretionary use due to functional requirements to
conserve funds for capital expenditures, property acquisitions, and other
commitments and uncertainties. To compensate for this, management considers
the impact of these excluded items to the extent they are material to
operating decisions or the evaluation of the Company's operating performance.
Adjusted FFO and Adjusted EBITDA
The Company presents adjusted FFO (including adjusted FFO per share/unit) and
adjusted EBITDA, which adjusts for certain additional items including gains on
sale of property and impairment losses (to the extent included in EBITDA),
acquisition transaction costs, costs associated with the departure of
executive officers, costs associated with the recognition of issuance costs
related to the calling of preferred shares and certain other items. The
Company excludes these items as it believes it allows for meaningful
comparisons with other REITs and between periods and is more indicative of the
ongoing performance of its assets. As with FFO, EBITDA, and hotel EBITDA, the
Company’s calculation of adjusted FFO and adjusted EBITDA may be different
from similar adjusted measures calculated by other REITs.
Contact:
LaSalle Hotel Properties
Bruce Riggins or Kenneth Fuller, 301-941-1500
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