LaSalle Hotel Properties Reports First Quarter Results
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LaSalle Hotel Properties Reports First Quarter Results
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Category: Worldwide - Industry economy
- Figures / Studies
This is a press release selected by our editorial committee and published online for free on 2008-04-24
LaSalle Hotel Properties (NYSE: LHO) today reported a net
loss to common shareholders of $14.8 million, or ($0.37) per diluted share for the quarter ended March 31,
2008, compared to net income of $15.7 million, or $0.39 per diluted share for the prior year. Net income for
the prior year includes the $30.3 million net gain on sale of the LaGuardia Marriott and the $3.9 million
write-off of the non-cash costs associated with the initial issuance of the Company’s Series A Preferred
Shares, which were redeemed by the Company in March 2007.
For the quarter ended March 31, 2008, the Company generated funds from operations (“FFO”) of
$9.8 million versus $7.6 million for the same period of 2007. On a per diluted share basis, FFO for 2008 was
$0.25 versus $0.19 a year ago. FFO for 2007 includes the $3.9 million non-cash write-off of the initial
issuance costs of the Series A Preferred Shares due to their redemption in March.
The Company’s earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the
first quarter was $24.5 million as compared to $58.8 million for the same period of 2007. EBITDA for 2007
includes the $30.3 million net gain on sale of the LaGuardia Marriott.
Room revenue per available room (“RevPAR”) decreased 1.0 percent for the first quarter to $118.26
versus the previous year. Average daily rate (“ADR”) increased 1.5 percent to $183.08 compared to the first
quarter of 2007, while occupancy declined 2.4 percent to 64.6 percent. The decline in RevPAR was
anticipated and was primarily attributable to the negative impact related to the disruption associated with the
Company’s numerous redevelopments, repositionings and renovation projects as well as the shift of the
Easter holiday to March from April in the prior year.
The Company’s hotels generated $27.9 million of EBITDA in the first quarter compared with $31.6 million
last year. EBITDA margins across the Company’s portfolio decreased 230 basis points from the prior year
period. The decline in portfolio-wide EBITDA and EBITDA margins was attributable to the decline in
RevPAR and other revenues.
“The performance of the economy, the lodging industry and our portfolio were in line with
expectations in the quarter,” said Jon Bortz, Chairman and Chief Executive Officer of LaSalle Hotel
Properties. “Despite weakening economic trends, the lodging industry managed to maintain pricing power
and modest growth in RevPAR. With our major renovations and repositionings materially complete, we
continue to anticipate faring better than the industry for the remainder of 2008.”
As of the end of the first quarter 2008, the Company had total outstanding debt of $967.1 million.
The Company’s $450.0 million credit facility had an outstanding balance of $152.0 million as of March 31,
2008. Trailing 12 month Corporate EBITDA (as defined in the Company’s senior unsecured credit facility)
to interest coverage ratio was 4.2 times. As of March 31, 2008, total debt to trailing 12 month Corporate
EBITDA equaled 4.7 times, one of the lowest debt to EBITDA ratios in the industry.
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