Wyndham Worldwide reports net income for the third quarter of 2015 was $190 million, or $1.61 per diluted share, compared with $206 million, or $1.64 per diluted share, for the third quarter of 2014. Domestic RevPAR increased 5.2%. In constant currency, total system-wide RevPAR increased 3.3%.
Wyndham Worldwide Corporation (NYSE:WYN) today announced results for the three months ended September 30, 2015.
THIRD QUARTER HIGHLIGHTS:
•Adjusted diluted earnings per share (EPS) was $1.78, an increase of 7% from adjusted diluted EPS of $1.67 in the third quarter of 2014. Reported diluted EPS was $1.61, compared with $1.64 in the third quarter of 2014.
•Revenues for the third quarter of 2015 increased 3% compared with the third quarter of 2014. On a currency neutral basis and excluding the impact of acquisitions and a divestiture, revenues increased 6% and adjusted EBITDA increased 7%.
•Gross vacation ownership sales increased 12% on a constant currency basis.
•Vacation rental transactions increased 6% excluding the impact of acquisitions and a divestiture.
•The Company repurchased 2.1 million shares of its common stock for $170 million during the quarter.
“We delivered great results in the third quarter across all our businesses, with more guests, staying more often, and more engaged than ever,” said Stephen P. Holmes, chairman and CEO. “This quarter was highlighted by a double digit increase in gross vacation ownership interest sales, strong growth in vacation rental transaction volume, and increased activity through our re-invigorated loyalty program. We are connecting the widest range of guests around the globe with the accommodation options they desire.”
THIRD QUARTER 2015 OPERATING RESULTS
Third quarter revenues were $1.6 billion, an increase of 3% from the prior year period. Excluding acquisitions and a divestiture, constant currency revenues increased 6% reflecting growth in each of the Company’s business segments.
Third quarter adjusted EBITDA was $412 million, compared with $418 million in the prior year period. Year-over-year adjusted EBITDA comparisons were adversely affected by foreign currency effects of $17 million in 2015, and the absence of results in 2015 from Canvas Holiday, a U.K.-based camping business, which contributed $18 million of EBITDA in the third quarter 2014 and was divested in the fourth quarter of 2014. Excluding these items and acquisitions, adjusted EBITDA increased 7%.
Adjusted net income was $210 million, or $1.78 per diluted share, compared with $210 million, or $1.67 per diluted share for the same period in 2014. Net income and earnings per share benefited from strong operations, but were negatively affected by the same factors that influenced adjusted EBITDA comparisons, noted above. EPS also benefited from the Company’s share repurchase program, which decreased the weighted average diluted share count 6% year-over-year.
Reported net income for the third quarter of 2015 was $190 million, or $1.61 per diluted share, compared with $206 million, or $1.64 per diluted share, for the third quarter of 2014. Reported net income in both periods reflects several items excluded from adjusted net income. The net result of these items unfavorably impacted third quarter 2015 net income by $20 million and unfavorably impacted third quarter 2014 net income by $4 million. Full reconciliations of adjusted net income to GAAP results appear in Table 8 of this press release. Year-over-year reported net income third quarter comparisons were negatively impacted by the same factors that influenced adjusted EBITDA comparisons, noted above.
Free cash flow was $660 million for the nine months ended September 30, 2015, compared with $750 million for the same period in 2014. The decline in free cash flow reflects the timing of capital expenditures and working capital, including inventory spending. The Company expects inventory spending in the fourth quarter of 2015 to be significantly lower than in the fourth quarter of 2014. The Company defines free cash flow as net cash provided by operating activities less capital expenditures. For the nine months ended September 30, 2015, net cash provided by operating activities was $817 million, compared with $899 million in the prior year period.
BUSINESS UNIT RESULTS
Lodging (Wyndham Hotel Group)
Revenues were $357 million in the third quarter of 2015, a 13% increase compared with the third quarter 2014. Adjusted EBITDA was $108 million, flat compared with the same period in 2014.
In constant currency and excluding acquisitions, revenues increased 4% and adjusted EBITDA increased 3%, reflecting domestic RevPAR growth, which was partially offset by increased marketing expenditures and higher costs related to the implementation of new property management and central reservation systems.
Domestic RevPAR increased 5.2%. In constant currency, total system-wide RevPAR increased 3.3%.
As of September 30, 2015, the Company’s hotel system consisted of approximately 7,760 properties and 672,000 rooms, a 2.5% room increase compared with the third quarter of 2014. The development pipeline included 910 hotels and over 122,800 rooms, of which 61% were international and 68% were new construction.
Vacation Exchange and Rentals (Wyndham Exchange & Rentals)
Revenues were $476 million in the third quarter of 2015, a 7% decline compared with the third quarter of 2014. In constant currency, and excluding acquisitions and the impact of the divestiture of Canvas Holidays in 2014, revenues increased 6%.
Exchange revenues were $157 million, down 3% compared with the third quarter of 2014. In constant currency, exchange revenues were up 1% compared with the prior year, as the average number of members increased 1.5% while exchange revenue per member was flat.
Vacation rental revenues were $296 million, an 11% decrease compared with the third quarter of 2014. In constant currency and excluding the impact of acquisitions and the divestiture, vacation rental revenues were up 8%, reflecting a 5.8% increase in transaction volume and a 1.7% increase in average net price per vacation rental.
Adjusted EBITDA for the third quarter of 2015 was $137 million, a 14% decrease compared with the third quarter of 2014. On a currency neutral basis and excluding the impact of acquisitions and the divestiture, adjusted EBITDA increased 5% compared with the prior year period.
Vacation Ownership (Wyndham Vacation Ownership)
Revenues were $750 million in the third quarter of 2015, a 7% increase over the third quarter of 2014. In constant currency, revenues increased 8%.
Gross VOI sales were $565 million in the third quarter of 2015, an increase of 10% compared with the third quarter of 2014. In constant currency, Gross VOI sales increased 12%. Volume per guest (VPG) for the quarter increased 10.6% in constant currency while tour flow increased 0.9%. VPG increases were driven primarily by a higher average transaction size.
Adjusted EBITDA for the third quarter of 2015 was $201 million, an increase of 7% compared with the third quarter of 2014. Results primarily reflect higher VPG. On a currency neutral basis adjusted EBITDA increased 9%.
OTHER ITEMS
•The Company repurchased 2.1 million shares of common stock for $170 million during the third quarter of 2015. From October 1 through October 26, 2015, the Company repurchased an additional 0.9 million shares for $70 million. The Company’s remaining share repurchase authorization totals $461 million as of October 26, 2015
•Reported net interest expense in the third quarter of 2015 was $31 million, compared with $26 million in the third quarter of 2014
Balance Sheet Information as of September 30, 2015:
•Cash and cash equivalents of $259 million, compared with $183 million at December 31, 2014
•Vacation ownership contract receivables, net, of $2.7 billion, unchanged from December 31, 2014
•Vacation ownership and other inventory of $1.3 billion, compared with $1.2 billion at December 31, 2014
•Securitized vacation ownership debt of $2.1 billion, compared with $2.2 billion at December 31, 2014
•Long-term debt of $3.1 billion, compared with $2.9 billion at December 31, 2014. The remaining borrowing capacity on the revolving credit facility, net of commercial paper borrowings, was $1.4 billion as of September 30, 2015, compared with $1.3 billion at December 31, 2014
To view full third quarter financial results and tables please visit:
http://investor.wyndhamworldwide.com/phoenix.zhtml?c=200690&p=irol-quarterlyearnings
FelCor reports third quarter 2015 net loss attributable to common stockholders was $14.5 million ($0.10 per share) in 2015, compared to net income of $62.7 million ( $0.50 per share) for the same period in 2014. RevPAR increased 7.0% over the same period in 2014.
FelCor Lodging Trust Incorporated (NYSE: FCH) today reported results for the third quarter ended September 30, 2015.
Third Quarter Highlights
- Same-store RevPAR increased 7.0% over the same period in 2014. Same-store RevPAR increased 10.0% in September.
- Hotel EBITDA margins increased 225 basis points over the same period in 2014.
- Adjusted FFO per share increased to $0.25 from $0.21 in the prior year.
- Adjusted EBITDA was $65.1 million and same-store Adjusted EBITDA increased by $8.2 million, or 14.9%, to $63.5 million compared to the same period in 2014.
- Net loss per share was $0.10.
- Sold two hotels for aggregate gross proceeds of $41.5 million.
“We are pleased with our progress this year. We have completed the non-strategic asset sale program and are realizing the returns from our repositioning and renovation efforts. We have created a high-quality and well-positioned portfolio that will continue to outperform the industry. We also completed several balance sheet initiatives that lowered our cost of debt, created the best debt maturity profile in the industry and will allow us to pursue opportunities that best drive stockholder value,” said Richard A. Smith, President and Chief Executive Officer of FelCor.
Mr. Smith added, “We remain optimistic about the future of the lodging industry. Although there were pockets of volatility during the quarter, we believe they do not reflect a lasting trend. September was particularly strong, with 10% RevPAR growth, as corporate travel bounced back solidly from a mid-quarter slow down. We expect demand growth to continue to outpace new supply, especially in our markets. This dynamic will allow us to continue to increase ADR across our portfolio.”
RevPAR for our 39 same-store hotels increased 7.0% (to $153.70) from the same period in 2014. The change reflects a 6.2% increase in ADR (to $190.19) and a 0.7% increase in occupancy (to 80.8%). Hotel EBITDA for our 39 same-store hotels increased by 14.9% to $66.9 million and Hotel EBITDA margin was 31.5% during the quarter, a 225 basis point increase.
RevPAR for our 39 same-store hotels increased 9.1% in July, 1.9% in August and 10.0% in September. Corporate transient and group room nights decreased in August, which led to a 2.4% decline in occupancy. Occupancy in September increased 4.6%. RevPAR in September was above our expectations, as demand trends rebounded significantly.
RevPAR for the eight Wyndham hotels (which we converted from Holiday Inn on March 1, 2013) increased 13.0% (to $142.70) from the same period in 2014. We expect revenue and EBITDA at these properties will continue to grow meaningfully this year because of their recent renovations and repositioning to the upper-upscale segment. Wyndham Worldwide Corporation has guaranteed the minimum annual NOI for these hotels through 2023. We recorded $258,000 of the guaranteed amount in the quarter.
Same-store Adjusted EBITDA increased 14.9% to $63.5 million from the same period in 2014. Adjusted EBITDA (which includes Adjusted EBITDA from sold hotels) was $65.1 million.
Adjusted FFO was $35.7 million ($0.25 per share), compared to $26.7 million ($0.21 per share) for the same period in 2014. Net loss attributable to common stockholders was $14.5 million ($0.10 per share) in 2015, compared to net income of $62.7 million ($0.50 per share) for the same period in 2014. Net loss for the third quarter 2015 included a $20.9 million impairment charge. Net income in 2014 included $29.6 million of net gain on the sale of consolidated hotels, a $30.2 million gain on the sale of our interest in unconsolidated hotels, and a $20.7 million gain on the fair value remeasurement of previously unconsolidated hotels.
Year-to-Date Operating Results
RevPAR for our 39 same-store hotels increased 9.0% (to $148.05) from the same period in 2014. The change reflects a 6.4% increase in ADR (to $187.60) and a 2.5% increase in occupancy (to 78.9%). Hotel EBITDA for our 39 same-store hotels increased 17.5% to $191.1 million, and Hotel EBITDA margin for these properties increased 222 basis points to 30.5%.
Same-store Adjusted EBITDA increased 19.3% to $177.8 million from the same period in 2014. Adjusted EBITDA (which includes Adjusted EBITDA from sold hotels) increased 7.7% to $184.7 million from the same period in 2014.
Adjusted FFO was $93.3 million ($0.68 per share), compared to $63.7 million ($0.51 per share) for the same period in 2014. Net loss attributable to common stockholders was $34.7 million ($0.26 per share) in 2015, compared to a net income of $52.8 million ($0.43 per share) for the same period in 2014. Net loss in 2015 included $30.9 million in debt extinguishment charges and a $20.9 million impairment charge offset by a $19.9 million net gain on the sale of consolidated hotels (including discontinued operations) and a $7.1 million gain on sale of an unconsolidated joint venture. Net income in 2014 included $51.0 million of net gain on the sale of consolidated hotels, a $30.2 million gain on the sale of our interest in unconsolidated hotels, and a $20.7 million gain on the fair value remeasurement of previously unconsolidated hotels.
To view full third quarter financial results and tables please visit:
http://phx.corporate-ir.net/phoenix.zhtml?c=118512&p=irol-newsArticle&ID=2102735
Extended Stay America Reports Third Quarter 2015 Net income of $58.2 million compared to $60.2 million in the comparable period in 2014, a decrease of 3.3%. RevPAR for the three months ended September 30, 2015 grew 6.5% over the comparable period in 2014.
Extended Stay America, Inc. (NYSE:STAY) (the “Company”) today announced consolidated results for the quarter ended September 30, 2015.
Third Quarter 2015 Highlights
- RevPAR grew 6.5% to $50.83
- Revenue increased 6.5% to $360.5 million
- Hotel Operating Margin expanded 310 basis points to 56.2%
- Adjusted EBITDA1 increased 11.2% to $181.4 million
- Net income decreased 3.3% to $58.2 million
- Adjusted Paired Share Income increased 11.2% to $66.6 million, or $0.33 per diluted Paired Share
Nine Months 2015 Highlights
- RevPAR grew 6.5% to $46.95
- Revenue increased 6.2% to $988.4 million
- Hotel Operating Margin1expanded 270 basis points to 54.8%
- Adjusted EBITDA increased 9.8% to $476.0 million
- Net income increased 23.1% to $150.9 million
- Adjusted Paired Share Income increased 19.6% to $163.8 million, or $0.80 per diluted Paired Share
Extended Stay America’s Chief Executive Officer, Gerry Lopez, commented “We are excited by our robust third quarter results and how they demonstrate the staying power of our hotel improvement strategy. In the third quarter, we grew RevPAR by 6.5% and Adjusted EBITDA by 11.2%, both strong numbers, and particularly so in a quarter with heightened industry concerns. Our lack of concentration in any single market and minimal exposure to fluctuations in international travel help to limit headwinds. We believe that our geographically diverse portfolio, which focuses on domestic markets, transient consumers and longer stay guests, is well positioned at this point in the economic cycle. Importantly, we believe we have additional value creation opportunities going forward, as we begin to realize benefits from the full implementation of our revenue management system, make progress with our Extended Perks loyalty program, build up our sales force, and execute hotel improvement initiatives across more and more of our portfolio.”
Mr. Lopez continued, “Our portfolio-wide renovation program continues to show strong results, and is on track for completion in early 2017. This quarter alone we completed the renovation of 31 properties and began renovations on another 49 hotels. As if that was not enough, our recently announced agreement to sell of 53 economy extended stay hotels for $285.0 million will further enhance the overall quality of our portfolio and will complete our transition to a single, nationwide brand. We believe this newly streamlined and renovated portfolio will be positioned to sustain attractive returns to our shareholders in the coming years.”
Financial and Operating Results
Total revenues for the three months ended September 30, 2015 increased 6.5% over the comparable period in 2014 to $360.5 million. Total revenues for the nine months ended September 30, 2015 increased 6.2% over the comparable period in 2014 to $988.4 million.
Revenue per available room (“RevPAR”) for the three months ended September 30, 2015 grew 6.5% over the comparable period in 2014, driven by an improvement in average daily rate (“ADR”) of 8.0% while occupancy decreased to 78.3% compared to 79.3% in the comparable period in 2014. RevPAR for the nine months ended September 30, 2015 grew 6.5% over the comparable period in 2014, driven by an improvement in ADR of 7.6% while occupancy decreased to 75.3% compared to 76.1% in the comparable period in 2014.
Hotel Operating Margin for the three months ended September 30, 2015 was 56.2% compared to 53.1% in the comparable period in 2014. Hotel operating margin flow-through, defined as the change in Hotel Operating Profit1 divided by the change in total room and other hotel revenues, was 105.2% for the three months ended September 30, 2015. Hotel Operating Margin1 for the nine months ended September 30, 2015 was 54.8% compared to 52.1% in the comparable period in 2014. Hotel operating margin flow-through for the nine months ended September 30, 2015 was 97.5%.
Adjusted EBITDA for the three months ended September 30, 2015 increased $18.3 million to $181.4 million, representing 11.2% growth over the comparable period in 2014. Adjusted EBITDA1 excludes non-cash equity-based compensation of $3.0 million, loss on disposal of assets of $1.3 million, asset impairment of $9.0 million, and other non-operating expense of $1.1 million. Adjusted EBITDA1 for the nine months ended September 30, 2015 increased $42.7 million to $476.0 million, representing 9.8% growth over the comparable period in 2014.
Net income for the three months ended September 30, 2015 was $58.2 million compared to $60.2 million in the comparable period in 2014, a decrease of 3.3%. The decline in net income in the third quarter was due to an asset impairment of $9.0 million and a higher tax rate driven primarily by a provision to return true up for 2014. Income tax expense for the three months ended September 30, 2015 was $21.3 million compared to $19.0 million in the comparable period in 2014. Net income for the nine months ended September 30, 2015 was $150.9 million compared to $122.6 million in the comparable period in 2014, an increase of 23.1%. Income tax expense for the nine months ended September 30, 2015 was $48.1 million compared to $38.2 million in the comparable period in 2014.
Adjusted Paired Share Income for the three months ended September 30, 2015 was $66.6 million, or $0.33 per diluted Paired Share, compared to $59.9 million, or $0.29 per diluted Paired Share, in the comparable period in 2014. Adjusted Paired Share Income1 for the nine months ended September 30, 2015 was $163.8 million, or $0.80 per diluted Paired Share, compared to $137.0 million, or $0.67 per diluted Paired Share, in the comparable period in 2014. Adjusted Paired Share Income1, a non-GAAP measure, represents net income, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share. A Paired Share entitles its holder to participate in 100% of the common equity and earnings of both Extended Stay America, Inc. and ESH Hospitality, Inc.
Capital
The Company invested $67.1 million in capital expenditures during the third quarter of 2015, which includes hotel renovations, ordinary maintenance capital and information technology projects.
Distribution
On October 27, 2015, the Board of Directors of ESH Hospitality, Inc. (“ESH REIT”), the Company’s subsidiary, declared a cash distribution of $0.15 per share for the third quarter of 2015, payable to ESH REIT’s Class A and Class B common shareholders. Additionally, the Board of Directors of Extended Stay America, Inc. declared a cash distribution of $0.02 per share for the third quarter of 2015, payable to Extended Stay America, Inc.’s common shareholders. These distributions, which total to $0.17 per Paired Share, will be payable on November 24, 2015 to shareholders of record as of November 10, 2015.
To view full third quarter financial results and tables please visit:
