Revenue of $183.0 million, down $0.7 million from the prior-year quarter; down $3.8 million or 2% on a constant currency basis; up $9.6 million or 6% on a constant currency basis excluding Brazil
Belmond Ltd. Reports Third Quarter 2017 Results
Revenue of $183.0 million, down $0.7 million from the prior-year quarter; down $3.8 million or 2% on a constant currency basis; up $9.6 million or 6% on a constant currency basis excluding Brazil
Net earnings attributable to Belmond Ltd. of $7.8 million compared with $22.9 million for the prior-year quarter
Adjusted EBITDA of $62.2 million, down $3.5 million or 5% from the prior-year quarter; down $4.5 million or 7% on a constant currency basis
Adjusted EBITDA excluding Brazil up $4.6 million or 8% from the prior-year-quarter on a constant currency basis
Adjusted net earnings from continuing operations of $15.5 million, compared with $23.3 million for the prior-year quarter
Same store revenue per available room (“RevPAR”) down 1% from the prior-year quarter; down 3% on a constant currency basis; up 6% on a constant currency basis excluding Brazil
Launches new website and brand campaign "The Art of Belmond" Belmond Ltd. (NYSE: BEL) (the “Company”), owners, part-owners or managers of 47 luxury hotel, restaurant, train and river cruise properties, including one scheduled for a 2018 opening in London, which operate in 24 countries, today announced its results for the third quarter ended September 30, 2017.
Roeland Vos, president and chief executive officer, remarked: “Our underlying operational performance continued to advance through the third quarter of 2017. Notable year-over-year growth was again recorded in our European hotels, with good demand for our properties in Italy, Spain and Russia continuing from the first half of the year. We have been particularly pleased with the ongoing strength of our safaris and portfolio of trains and cruises worldwide, including Belmond Grand Hibernian, which we launched in the same period last year.
"Challenging conditions in Brazil this year, coupled with the Olympics taking place in the third quarter of last year, resulted in a significant fall in EBITDA from that country, albeit mitigated by a number of cost reduction initiatives. Economic data point to a gradual improvement in the Brazilian economy, and we expect to see a moderate improvement in results from next year. Elsewhere, we are heartened that enhanced revenue-driving initiatives coupled with healthy demand has seen EBITDA for the portfolio increase, with adjusted EBITDA excluding Brazil up 8%.
"A number of key projects were delivered in the third quarter and serve as examples of our continued progress against our strategic growth plan. Our new website went live, as scheduled, and we continued to make good progress with our CRM program. Our exciting new brand campaign 'The Art of Belmond' launched as planned, supported by global media and marketing activities to drive even greater brand awareness. We look forward to the benefit of all these initiatives as we move into next year.
"Looking ahead, as we factor in the increased headwinds we have been experiencing in Brazil we expect to come in at the low end of our previously guided range for constant currency RevPAR growth and now expect to finish the year with growth of between 0% and 2%."
Third Quarter 2017 Operating Results
Revenue for the third quarter of 2017 was $183.0 million, a $0.7 million decrease from revenue for the third quarter of 2016. In constant currency, revenue for the third quarter of 2017 decreased $3.8 million or 2% from the third quarter of 2016. The year-over-year decrease comes principally from the Company's two hotels in Brazil which have been impacted by the political and economic instability in the country coupled with a comparison period when both hotels recorded exceptionally high revenue as a result of Rio de Janeiro hosting the Summer Olympics. Excluding Brazil, revenue for the third quarter of 2017 increased $9.6 million or 6% on a constant currency basis from the third quarter of 2016.
Same store RevPAR for owned hotels for the third quarter of 2017 decreased 1% from the prior-year quarter. On a constant currency basis, same store RevPAR for owned hotels decreased 3% from the prior-year quarter as a result of a 2 percentage point decrease in occupancy offset by a 2% increase in average daily rate ("ADR").
Net earnings attributable to Belmond Ltd.for the third quarter of 2017 were $7.8 million ($0.08 per common share), which compared to net earnings attributable to Belmond Ltd. of $22.9 million ($0.23 per common share) for the third quarter of 2016.
Adjusted EBITDA for the third quarter of 2017 was $62.2 million, a $3.5 million or 5% decrease from adjusted EBITDA of $65.7 million for the third quarter of 2016. In constant currency, adjusted EBITDA for the third quarter of 2017 decreased $4.5 million or 7% from the third quarter of 2016. Excluding Brazil, adjusted EBITDA for the third quarter of 2017 on a constant currency basis increased $4.6 million or 8% from the third quarter of 2016.
Adjusted net earnings from continuing operations for the third quarter of 2017 were $15.5 million ($0.15 per common share), a $7.8 million decrease from adjusted net earnings from continuing operations of $23.3 million ($0.23 per common share) for the third quarter of 2016.
In September the islands of Anguilla and St Martin were hit by Hurricanes Irma and Jose when both Belmond La Samanna on St Martin and Belmond Cap Juluca on Anguilla were closed for the season. While there is still great uncertainty associated with St Martin and the speed of its recovery, based on our preliminary assessment, we anticipate that Belmond La Samanna will re-open in the fourth quarter of 2018. Belmond Cap Juluca is undergoing planned renovations and we also currently expect to re-open the resort in the fourth quarter of 2018.
Both properties are included in Belmond's global insurance program which provides a combined property damage and twelve month business interruption cover of $30.0 million. In addition, Belmond La Samanna has a separate property damage insurance policy of Euro 4.9 million ($5.8 million) covering the eight villas at the resort.
We have made preliminary assessments regarding the nature and extent of the damage sustained and we are preparing the insurance claim. Based on our preliminary estimate at this time, we anticipate that the property damage elements of the claim alone could absorb the available cover, which therefore would not be sufficient to cover business interruption claims of approximately $8.0 million to $10.0 million over the next 12 months. A deductible of $1.3 million has been expensed in the third quarter.
The Company also believes this situation presents an opportunity to re-examine proposed capital expenditures for Belmond Cap Juluca and Belmond La Samanna, potentially increasing the scope of the projects but also increasing the impact of the ultimate build-outs. This re-evaluation, which will continue to be updated, is subject to a number of uncertainties, such as the speed of the recovery of St Martin and Anguilla and the impact of the hurricane on fuel, transportation and labor prices over the coming year.
During the quarter, the Company agreed to sell its shares in Northern Belle Limited, which owns the Belmond Northern Belle rolling stock, for £2.5 million ($3.4 million) to a joint venture that operates other rail charter operations in the UK. This business was operating at a break-even level of EBITDA and was considered non-core to our trains and cruises segment. This sale closed on November 2, 2017 and no gain or loss is expected to be recorded upon completion.
In October 2017, the Company provided notice of termination to the owner of Belmond Orcaella in respect of its charter agreement that is to be effective by early November. This business was operating at a loss and in the nine months to September 30, 2017 had contributed an adjusted EBITDA loss of $0.8 million. The Company continues to own its Road to Mandalay vessel and to operate that cruise business in Myanmar.
Recent Company Highlights
Unveils new Global Brand Campaign to drive brand awareness -On October 10, 2017, ‘The Art of Belmond’ campaign launched globally with print and digital advertising supported by targeted social media and display marketing in key markets. Media events were held in core strategic cities: New York, London and Rio de Janeiro. Early results have been encouraging and the campaign will be unveiled in China later this month.
Launches new website bringing the brand’s new visual identity to life online - On September 23, 2017, the Company’s new cloud-hosted website went live with fully refreshed content, completing the first phase of this project. The Company launched the new brand campaign across the site in mid-October. The next phase will include an overhaul of the booking engine, which will unlock cross-selling and upselling opportunities for each of our assets. The booking engine is expected to be fully rolled out in the fourth quarter and the integration of customer profiles is also expected to complete before year end.
Continues to deliver projects in line with strategic reinvestment program - The full refurbishment of the Pergula restaurant at Belmond Copacabana Palace was completed in mid-October and included a renovation of the outdoor dining, bar and kitchen. The Company’s long-term commitment to this strategically significant market remains unchanged and this investment underlines the Company's confidence in the future recovery of the asset. This iconic hotel is now well positioned to capitalise once the market recovers.
Further strengthens development team - On September 11, 2017, in line with its strategic growth plan, the Company expanded its development team in Asia with the appointment of Sandeep Jain, Director of Development, who joins the Company with deep experience in the Asian development market from his tenure with other leading luxury hotel operators. A further key appointment in the Americas region is expected to be made in due course and will complete the resource requirement for the Company’s footprint expansion.
Iconic trains involved with two Hollywood Movies - On November 3, 2017, ‘Murder on the Orient Express’ was released. Belmond partnered with 20th Century Fox Productions on the film adaptation, with carriages from the Company's Venice-Simplon-Orient Express luxury train business part of the story's heritage.Additionally, the Belmond British Pullman features in Paddington Bear 2, to be released November 10, 2017.
Secures brand recognition at top industry Awards - On October 30, 2017, Belmond was awarded the prize for 'Excellence in Luxury Leisure' at the 21st annual Luxury Briefing Awards. In the same month, Belmond Cipriani was voted as the best hotel in Italy in the Conde Nast Traveller Awards (US), and the Inn at Perry Cabin by Belmond was recognized as the Top Resort in New York and the Mid-Atlantic.
Third Quarter 2017 Business Unit Results
Owned hotels:
Europe:
For the third quarter of 2017, revenue from owned hotels was $96.7 million, an increase of $4.4 million or 5% from $92.3 million for the third quarter of 2016. In constant currency, revenue for the region for the third quarter of 2017 increased $2.6 million or 3% from the prior year quarter primarily due to a $1.8 million or 3% revenue increase for the Company's Italian hotels and a $0.9 million or 11% increase at Belmond La Residencia, Mallorca, Spain. Revenue growth for the Company's Italian hotels was largely driven by the performances of Belmond Hotel Cipriani, Venice, Italy, which benefited from the Biennale Arts Festival that takes place every other year in Venice, and Belmond Hotel Splendido, Portofino, Italy, which saw an increase in rates year-over-year following the addition of balconies to twelve of its rooms in March 2017. Growth in revenue at Belmond La Residencia was primarily due to an increase in rates following the addition of six new suites.
In constant currency, same store RevPAR for owned hotels in the region increased 6% from the prior-year quarter as a result of an 8% increase in ADR offset by a 2 percentage point fall in occupancy.
Adjusted EBITDA for the region for the quarter of $48.7 million represented an increase of $3.1 million or 7% from $45.6 million for the third quarter of 2016. In constant currency, revenue for the region for the third quarter increased $2.8 million or 6% from the prior year quarter mainly due to a $2.6 million or 7% increase in adjusted EBITDA at the Company's Italian hotels and a $0.6 million or 14% increase in adjusted EBITDA at Belmond La Residencia, Mallorca.
North America:
Revenue from owned hotels for the third quarter of 2017 was $32.9 million, up $2.3 million or 8% from $30.6 million for the third quarter of 2016. In constant currency, revenue for the region for the third quarter of 2017 increased $2.3 million or 8% from the prior year quarter primarily due to revenue growth of $0.7 million or 4% at Belmond Charleston Place, Charleston, South Carolina, and $1.5 million from the newly acquired Belmond Cap Juluca, Anguilla. Belmond Charleston Place continued to benefit from group business and also saw an increase in demand from leisure travelers attracted to the solar eclipse in August. However, stronger year-over-year growth was hindered by cancellations after the South Carolina Governor's declaration of a state of emergency in advance of Hurricane Irma reaching the state, resulting in $1.2 million in lost revenue.
In constant currency, same store RevPAR for owned hotels in the region increased 2% from the prior-year quarter due to a 5% increase in ADR offset by a 2 percentage point decrease in occupancy.
Adjusted EBITDA for the region for the quarter was $2.3 million, a decrease of $0.9 million or 28% from $3.2 million for the third quarter of 2016. In constant currency, adjusted EBITDA for the region for the third quarter of 2017 decreased $1.0 million or 31% primarily as a result of $0.7 million in losses at Belmond Cap Juluca that were anticipated in its seasonal quiet period prior to closure for renovation at the end of August 2017.
Rest of world:
Revenue from owned hotels for the third quarter of 2017 was $26.8 million, a decrease of $10.2 million or 28% from $37.0 million for the third quarter of 2016. In constant currency, revenue for the third quarter of 2017 decreased $12.0 million or 32% from the prior year quarter, principally as a result of decline in revenue of $13.5 million or 56% at the Company's two Brazilian properties. This resulted from a combination of exceptionally high revenue in the third quarter of 2016 due to the Summer Olympics held in Rio de Janeiro and the impact in the third quarter of 2017 of continued political and economic instability in the country. This was partially offset by an increase in revenue of $0.4 million or 13% at Belmond Safaris, Botswana which benefited from refurbishment in 2016 and 2017 that has been well received by the media and guests. Additionally, revenue at Belmond La Résidence d'Angkor, Siem Reap, Cambodia, contributed a $0.6 million increase in revenue following a full renovation of the property in 2016.
In constant currency, same store RevPAR for owned hotels decreased 31% from the prior-year quarter as a result of a 5 percentage point decrease in occupancy and 23% decrease in ADR.
Adjusted EBITDA for the region for the quarter of $3.5 million decreased $7.8 million or 69% from adjusted EBITDA of $11.3 million for the prior-year quarter. In constant currency, adjusted EBITDA for the region decreased $8.5 million or 75% from the prior-year quarter largely as a result of an adjusted EBITDA decrease of $9.1 million or 104% at the Company's two Brazilian properties.
Owned trains & cruises:
Revenue for the third quarter of 2017 was $23.7 million, up $4.5 million or 23% from $19.2 million for the third quarter of 2016. In constant currency, revenue increased $4.9 million or 26% primarily as a result of the Belmond Grand Hibernian train in Ireland, which commenced its first full year of operations in April 2017 and recorded $3.2 million of revenue for the third quarter. Additionally, the Belmond Royal Scotsman train in Scotland grew revenue by $1.1 million or 39% year-over-year following high demand and the addition of a spa car and four new berths.
Adjusted EBITDA for the quarter was $5.4 million, a $2.2 million or 69% increase from adjusted EBITDA of $3.2 million for the third quarter of 2016 largely due to adjusted EBITDA growth for Belmond Royal Scotsman and Belmond Grand Hibernian of $1.0 million and $0.7 million, respectively.
Management fees:
Adjusted EBITDA from management fees for the third quarter of 2017 was $4.7 million, an increase of $0.1 million or 2% from $4.6 million for the third quarter of 2016.
Share of pre-tax earnings from unconsolidated companies: Adjusted share of pre-tax earnings from unconsolidated companies for the third quarter of 2017 was $6.0 million, a decrease of $0.7 million or 10% against $6.7 million for the third quarter of 2016 due to an adjusted EBITDA decrease of $0.7 million or 13% for the Company's Peruvian train joint venture, PeruRail, as a result of increases in fuel costs and other operating expenses.
Central overheads:
For the third quarter of 2017, adjusted central overheads of $7.0 million were $0.6 million or 9% higher than adjusted central overheads of $6.4 million for the prior-year quarter mainly due to increased development and other corporate headcount to support the strategic growth plan.
Depreciation and amortization: For the third quarter of 2017, depreciation and amortization of $17.0 million was $3.9 million or 30% higher than depreciation and amortization of $13.1 million for the prior-year quarter primarily as a result of the recent completion of various capital projects and accelerated depreciation expense to write-off assets that are expected to be replaced.
Investments
The Company continued its strategy of disciplined re-investment in core assets and projects with attractive forecasted returns. During the third quarter of 2017, the Company invested a total of $15.6 million in its portfolio, including $2.6 million on the full refurbishment of the Pergula Restaurant at Belmond Copacabana Palace, Rio de Janeiro, Brazil; $1.4 million at Belmond Casa de Sierra Nevada, Mexico for the renovation of 37 rooms and the Andanza restaurant; $1.3 million at Belmond Villa Sant' Andrea, Taormina Mare, Italy for the creation of three new suites and a boardroom; $1.1 million at Belmond Mount Nelson Hotel, Cape Town, South Africa largely for the refurbishment of the tea lounge, veranda and terrace; and $1.4 million for corporate projects, which included the Company's new enterprise resource planning system and website.
Balance Sheet
At September 30, 2017, the Company had total debt of $705.1 million and cash balances of $212.5 million, resulting in total net debt of $492.6 million and a ratio of net debt to trailing-twelve-months adjusted EBITDA of 4.0 times, which compared to net debt of $435.1 million and a ratio of net debt to trailing-twelve-months adjusted EBITDA of 3.4 times at December 31, 2016.
Outlook
The Company is providing the following RevPAR and other guidance for the fourth quarter and full year 2017:
Fourth Quarter 2017
Full Year 2017
Same store worldwide owned hotel RevPAR growth guidance (1)
On a constant currency basis
3% - 7%
0% - 2%
In U.S. dollars
10% - 14%
4% - 6%
Statement of operations guidance ($ millions)
Adjusted central overheads
$6.9 - $7.9
$28.7 - $29.7
Adjusted share-based compensation
$1.2 - $2.2
$6.3 - $7.3
Adjusted central marketing costs
$1.7 - $2.7
$4.8 - $5.8
Depreciation and amortization (2)
$14.5 - $15.5
$60.3 - $70.3
Interest expense (3)
$7.8 - $8.8
$31.1 - $32.1
Tax expense (4)
$(1.3) - $(2.3)
$19.4 - $20.4
Cash flow guidance ($ millions)
Cash interest expense (3)
$6.1 - $7.1
$27.8 - $28.8
Cash tax expense (5)
$8.5 - $9.5
$19.5 - $20.5
Scheduled loan repayments (3)
$1.1 - $2.1
$4.9 - $5.9
(1) Projected same store RevPAR growth for the fourth quarter ending December 31, 2017 and full year ending December 31, 2017 excludes the operations of Belmond Cap Juluca, Anguilla, British West Indies, which was acquired in May 2017, and Belmond La Résidence d'Angkor, Siem Reap, Cambodia, which closed for refurbishment from May to November 2016.
(2) Projected depreciation and amortization expense for the fourth quarter ending December 31, 2017 and full year ending December 31, 2017 includes forecasted accelerated depreciation related to an expected renovation at one of the Company's properties, which accelerated depreciation had not been assumed in the Company's prior depreciation and amortization guidance.
(3) Interest expense, cash interest expense and scheduled loan repayments guidance includes the impact of the Company's corporate credit facility refinancing, which closed on July 3, 2017.
(4) Tax expense guidance includes the Company's share of provision for income taxes of unconsolidated companies.
(5) Cash tax expense guidance does not include the Company's share of provision for income taxes of unconsolidated companies.
BELMOND LTD. EARNINGS RELEASE SCHEDULES TABLE OF CONTENTS
Statements of Condensed Consolidated Operations
9
Segment Information - Revenue and Adjusted EBITDA
10
Summary of Operating Information for Owned Hotels
11
Condensed Consolidated Balance Sheets
12
Reconciliations - Adjusted EBITDA and Adjusted Share of Pre-Tax Earnings from Unconsolidated Companies
13
Reconciliations - Adjusted Net Earnings / (Losses)
14
Net Debt to Adjusted EBITDA
15
BELMOND LTD. STATEMENTS OF CONDENSED CONSOLIDATED OPERATIONS (Unaudited)
$ millions – except per share amounts
Three months ended September 30,
Nine months ended September 30,
2017
2016
2017
2016
Revenue
183.0
183.7
443.7
435.6
Expenses:
Cost of services
72.0
72.0
184.8
186.5
Selling, general and administrative (1)
59.4
53.3
184.2
150.2
Depreciation and amortization
17.0
13.1
46.0
39.6
Impairment of property, plant and equipment
—
1.0
8.2
1.0
Total operating costs and expenses
148.4
139.4
423.2
377.3
Gain on disposal of property, plant and equipment
0.2
0.5
0.5
0.8
Earnings from operations
34.8
44.8
21.0
59.1
Gain on extinguishment of debt
—
—
—
1.2
Interest income
0.2
0.3
0.6
0.6
Interest expense
(9.0
)
(7.8
)
(24.5
)
(23.0
)
Foreign currency, net
(1.5
)
1.4
(2.7
)
9.2
Earnings / (losses) before income taxes and earnings from unconsolidated companies, net of tax
24.5
38.7
(5.6
)
47.1
Provision for income taxes
(20.7
)
(20.4
)
(17.6
)
(25.1
)
Earnings / (losses) before earnings from unconsolidated companies, net of tax
3.8
18.3
(23.2
)
22.0
Earnings from unconsolidated companies, net of tax provision of $2.0, $1.7, $4.1 and $3.9
3.9
4.6
7.8
7.7
Earnings / (losses) from continuing operations
7.7
22.9
(15.4
)
29.7
Net earnings from discontinued operations, net of tax provision of $Nil, $Nil, $Nil and $Nil
—
—
0.1
0.1
Net earnings / (losses)
7.7
22.9
(15.3
)
29.8
Net losses / (earnings) attributable to non-controlling interests
0.1
—
—
(0.1
)
Net earnings / (losses) attributable to Belmond Ltd.
7.8
22.9
(15.3
)
29.7
EPS attributable to Belmond Ltd.
0.08
0.23
(0.15
)
0.29
Weighted average number of shares – millions
102.33
101.75
102.11
101.53
(1) Selling, general and administrative expenses include operating costs of businesses plus central overheads, share-based compensation and central marketing costs. Selling, general and administrative expenses also included acquisition-related costs associated with the May 26, 2017 acquisition of Cap Juluca of $0.3 million and $14.1 million for the three and nine months ended September 30, 2017, respectively. Selling, general and administrative expenses also included certain trains and cruises expenses of $1.7 million and $6.0 million respectively that were reclassified from cost of services in the three and nine months ended September 30, 2017.
BELMOND LTD. SEGMENT INFORMATION (Unaudited)
$ millions
Three months ended September 30,
Nine months ended September 30,
2017
2016
2017
2016
Revenue
Owned hotels
- Europe
96.7
92.3
180.8
172.8
- North America
32.9
30.6
115.2
108.2
- Rest of world
26.8
37.0
88.6
96.6
Total owned hotels
156.4
159.9
384.6
377.6
Owned trains & cruises
23.7
19.2
50.6
47.1
Management fees
2.9
4.6
8.5
10.9
Revenue
183.0
183.7
443.7
435.6
Adjusted EBITDA
Owned hotels
- Europe
48.7
45.6
71.5
66.4
- North America
2.3
3.2
21.8
21.7
- Rest of world
3.5
11.3
15.9
24.9
Total owned hotels
54.5
60.1
109.2
113.0
Owned trains & cruises
5.4
3.2
5.3
4.0
Management fees
4.7
4.6
11.5
10.9
Share of pre-tax earnings from unconsolidated companies
6.0
6.7
11.9
12.1
70.6
74.6
137.9
140.0
Central overheads
(7.0
)
(6.4
)
(21.7
)
(19.4
)
Share-based compensation
(1.5
)
(2.1
)
(5.0
)
(5.9
)
Central marketing costs
0.1
(0.4
)
(3.2
)
(3.0
)
Adjusted EBITDA
62.2
65.7
108.0
111.7
BELMOND LTD. SUMMARY OF OPERATING INFORMATION FOR OWNED HOTELS
Three months ended September 30,
Nine months ended September 30,
2017
2016
2017
2016
Room Nights Available
Europe
86,817
86,112
214,135
213,056
North America
66,872
62,986
198,270
192,752
Rest of world
94,392
94,944
280,818
282,008
Worldwide
248,081
244,042
693,223
687,816
Room Nights Sold
Europe
66,974
68,102
143,262
142,965
North America
43,210
42,246
134,914
132,518
Rest of world
43,767
46,985
144,944
152,872
Worldwide
153,951
157,333
423,120
428,355
Occupancy
Europe
77%
79%
67%
67%
North America
65%
67%
68%
69%
Rest of world
46%
49%
52%
54%
Worldwide
62%
64%
61%
62%
ADR (in U.S. dollars)
Europe
928
839
791
731
North America
383
359
432
418
Rest of world
376
479
378
390
Worldwide
618
603
535
512
RevPAR (in U.S. dollars)
Europe
716
664
529
490
North America
248
241
294
287
Rest of world
174
237
195
211
Worldwide
383
389
327
319
Same Store RevPAR (in U.S. dollars) (1)
Europe
716
664
529
490
North America
247
241
294
287
Rest of world
181
252
201
219
Worldwide
393
397
332
325
Same Store RevPAR (% change)
U.S. dollar
Constant currency
U.S. dollar
Constant currency
Europe
8%
6%
8%
7%
North America
2%
2%
2%
3%
Rest of world
(28)%
(31)%
(8)%
(16)%
Worldwide
(1)%
(3)%
2%
—%
(1) Same store RevPAR data for the three and nine months ended September 30, 2017 and September 30, 2016 excludes the operations of Belmond Cap Juluca, which was acquired in May 2017, and Belmond La Résidence d’Angkor, which closed for refurbishment in May 2016 and re-opened in November 2016.
Property, plant & equipment, net of accumulated depreciation
1,167.5
1,074.7
Investments in unconsolidated companies
83.1
79.3
Goodwill
125.1
113.3
Other intangible assets
20.3
13.9
Other assets
12.5
13.5
Total assets (1)
1,718.4
1,524.1
Liabilities and Equity
Accounts payable
16.3
16.4
Accrued liabilities
98.8
69.0
Deferred revenue
38.6
31.3
Liabilities held for sale
0.9
—
Current portion of long-term debt and capital leases
6.8
5.3
Total current liabilities
161.4
122.0
Long-term debt and obligations under capital leases
698.3
585.8
Liability for pension benefit
0.4
1.4
Deferred income taxes
133.2
122.3
Other liabilities
1.0
5.4
Liability for uncertain tax positions
0.4
0.3
Total liabilities (2)
994.7
837.2
Shareholders’ equity
723.3
686.5
Non-controlling interests
0.4
0.4
Total equity
723.7
686.9
Total liabilities and equity
1,718.4
1,524.1
(1) Balance at September 30, 2017 includes $207.7 million (December 31, 2016 - $210.3 million) of assets of consolidated variable interest entities ("VIEs") that can only be used to settle obligations of the VIEs.
(2) Balance at September 30, 2017 includes $122.3 million (December 31, 2016 - $121.6 million) of liabilities of consolidated VIEs whose creditors have no recourse to Belmond Ltd.
BELMOND LTD. RECONCILIATIONS - ADJUSTED EBITDA AND ADJUSTED SHARE OF PRE-TAX EARNINGS FROM UNCONSOLIDATED COMPANIES (Unaudited)
$ millions
Three months ended September 30,
Nine months ended September 30,
2017
2016
2017
2016
Adjusted EBITDA reconciliation:
Earnings / (losses) from continuing operations
7.7
22.9
(15.4
)
29.7
Depreciation and amortization
17.0
13.1
46.0
39.6
Gain on extinguishment of debt
—
—
—
(1.2
)
Interest income
(0.2
)
(0.3
)
(0.6
)
(0.6
)
Interest expense
9.0
7.8
24.5
23.0
Foreign currency, net
1.5
(1.3
)
2.7
(9.1
)
Provision for income taxes
20.7
20.4
17.6
25.1
Share of provision for income taxes of unconsolidated companies
2.1
1.7
4.1
3.9
57.8
64.3
78.9
110.4
Restructuring and other special items (1)
4.3
0.9
7.3
1.1
Acquisition-related costs (2)
0.3
—
14.1
—
Gain on disposal of property, plant and equipment
(0.2
)
(0.5
)
(0.5
)
(0.8
)
Impairment of property, plant and equipment
—
1.0
8.2
1.0
Adjusted EBITDA
62.2
65.7
108.0
111.7
(1) Represents adjustments for insurance deductibles and losses while Belmond Cap Juluca and Belmond La Samanna are closed following the impact of Hurricanes Irma and Jose, restructuring, severance and redundancy costs, pre-opening costs and other items, net.
(2) Represents professional fees incurred in preliminary design and planning, structuring, assessment of financing opportunities, legal, tax, accounting and engineering due diligence and the negotiation of the purchase and sale agreements, and other ancillary documents, with the principal owner and leaseholder, together with three owners of villas and separate subleases, as well as a memorandum of understanding and ground lease with the Government of Anguilla.
