STRATEGIC HOTELS & RESORTS, INC - FORM 8-K - EX-99.2 - SUPPLEMENTAL FINANCIAL INFORMATION - August 6, 2012

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Exhibit 99.2

 

LOGO

Strategic Hotels & Resorts, Inc.

Supplemental Financial Information

June 30, 2012

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

TABLE OF CONTENTS

 

      PAGE  

CORPORATE INFORMATION

   

The Company

      1   

Board of Directors

      2   

Officers

      3   

Equity Research Coverage

      4   

FINANCIAL HIGHLIGHTS

   

Supplemental Financial Data

      5   

Consolidated Statements of Operations

      6   

Consolidated Balance Sheets

      7   

Discontinued Operations

      8   

Investments in the Hotel del Coronado and Fairmont Scottsdale Princess Hotel

      9   

Leasehold Information

      10   

Non-GAAP Financial Measures

      11   

Reconciliation of Net (Loss) Income Attributable to SHR Common Shareholders to EBITDA and Comparable EBITDA

      12   

Reconciliation of Net (Loss) Income Attributable to SHR Common Shareholders to Funds From Operations (FFO), FFO—Fully Diluted and Comparable FFO

      13   

Debt Summary

      14   

PORTFOLIO DATA

   

Portfolio at June 30, 2012

      15   

Seasonality by Geographic Region

      16   

Operating Statistics by Geographic Region

      17   

Selected Financial and Operating Information by Property

      18-21   

Reconciliation of Property EBITDA to EBITDA

      22   

Reconciliation of Property EBITDA to Comparable EBITDA

      23   

2012 Guidance

      24   

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

CORPORATE INFORMATION

The Company

Strategic Hotels & Resorts, Inc. is an industry-leading owner and asset manager of high-end hotels and resorts. We own interests in or lease a quality portfolio of upper upscale and luxury hotels and resorts in desirable North American and European locations. Our portfolio is currently made up of 17 properties totaling 7,762 rooms. We own interests in or lease unique hotels with complex operations, sophisticated customers and multiple revenue streams. Our properties include large convention hotels, business hotels and resorts, which are managed by internationally recognized hotel management companies.

We believe our asset management expertise is what truly distinguishes us. Asset management is our focus, our core competency, and our competitive advantage. Our business is driven by our team’s depth of knowledge and hands-on expertise in every aspect of the lodging industry. While our focus is to drive top line revenues, we importantly focus on every component of bottom line profitability. We use our experience to make selective, value added acquisitions and recycle capital through thoughtful and planned dispositions. Simply put, we are utilizing our expert management skills in building a great hotel company which we believe will provide attractive returns for our shareholders.

Strategic Hotels & Resorts, Inc. is a real estate investment trust (REIT) and is traded on the New York Stock Exchange under the symbol BEE.

Fiscal Year End:

December 31

Number of Full-Time Equivalent Employees:

41

Corporate Headquarters:

200 West Madison Street, Suite 1700

Chicago, IL 60606

(312) 658-5000

Company Contacts:

Diane M. Morefield

Executive Vice President, Chief Financial Officer

(312) 658-5000

Jonathan P. Stanner

Vice President, Capital Markets and Treasurer

(312) 658-5000

 

1

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

Board of Directors

Raymond L. Gellein, Jr.

Chairman of the Board and Executive Committee

Laurence S. Geller, CBE

Director, President and Chief Executive Officer

Robert P. Bowen

Director and Chairman of the Audit Committee

James A. Jeffs

Director and Chairman of the Compensation Committee

William A. Prezant

Director and Chairman of the Corporate Governance and Nominating Committee

Kenneth Fisher

Director

Richard D. Kincaid

Director

Sir David M.C. Michels

Director

Eugene F. Reilly

Director

Sheli Z. Rosenberg

Director

 

2

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

Officers

Laurence S. Geller, CBE

President and Chief Executive Officer

Diane M. Morefield

Executive Vice President, Chief Financial Officer (Principal Financial Officer)

Richard J. Moreau

Executive Vice President, Chief Operating Officer

Stephen M. Briggs

Senior Vice President, Chief Accounting Officer (Principal Accounting Officer)

Paula C. Maggio

Senior Vice President, Secretary & General Counsel

Robert T. McAllister

Senior Vice President, Tax

Patricia A. Needham

Senior Vice President, Assistant Secretary

John K.T. Barrett

Vice President, Asset Management

Gregory A. Brenner

Vice President, Controller

D. Robert Britt

Vice President, Asset Management

Michael A. Dalton

Vice President, Design

Eric D. Hassberger

Vice President, Asset Management

Thomas G. Healy

Vice President, Asset Management

David R. Hogin, Jr.

Vice President, Asset Management

James L. Porter

Vice President, Internal Audit

Jonathan P. Stanner

Vice President, Capital Markets and Treasurer

Cory P. Warning

Vice President, Investments

 

3

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

Equity Research Coverage

 

Firm

  

Analyst

   Telephone

Bank of America Merrill Lynch

   Andrew Didora   (646) 855-2924

Deutsche Bank North America

   Carlo Santarelli   (212) 250-5815

Green Street Advisors

   Enrique Torres   (949) 640-8780

International Strategy & Investment Group, Inc.

   Ian Weissman   (212) 446-9461

JMP Securities

   Will Marks   (415) 835-8944

J.P. Morgan Securities

   Joseph Greff   (212) 622-0548

Keefe, Bruyette & Woods

   Smedes Rose   (212) 887-3696

Raymond James & Associates

   William Crow   (727) 567-2594

Wells Fargo Securities, LLC

   Jeffrey Donnelly   (617) 603-4262

Strategic Hotels & Resorts, Inc. is followed by the analysts listed above. Please note that any opinions, estimates or forecasts regarding Strategic Hotels & Resorts, Inc.'s performance made by these analysts are theirs alone and do not represent opinions, forecasts or predictions of Strategic Hotels & Resorts, Inc. or its management. Strategic Hotels & Resorts, Inc. does not by its reference here imply its endorsement of, or concurrence with, such information, conclusions or recommendations.

 

4

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

FINANCIAL HIGHLIGHTS

Supplemental Financial Data

(in thousands, except per share information)

 

     June 30, 2012  
     Pro Rata Share     Consolidated  

Capitalization

     

Common shares outstanding

      204,309        204,309   

Operating partnership units outstanding

      853        853   

Restricted stock units outstanding

      1,357        1,357   

Value Creation Plan units outstanding under the deferral program

      1,239        1,239   
  

 

 

    

 

 

  

Combined shares and units outstanding

      207,758        207,758   

Common stock price at end of period

    $ 6.46      $ 6.46   
  

 

 

    

 

 

  

Common equity capitalization

    $ 1,342,117      $ 1,342,117   

Preferred equity capitalization (at $25.00 face value)

      289,102        289,102   

Consolidated debt

      1,045,817        1,045,817   

Pro rata share of unconsolidated debt

      212,275        —     

Pro rata share of consolidated debt

      (45,548 )      —     

Cash and cash equivalents

      (76,180 )      (76,180 ) 
  

 

 

    

 

 

  

Total enterprise value

    $ 2,767,583      $ 2,600,856   
  

 

 

    

 

 

  

Net Debt / Total Enterprise Value

      41.1 %      37.3 % 

Preferred Equity / Total Enterprise Value

      10.4 %      11.1 % 

Common Equity / Total Enterprise Value

      48.5 %      51.6 % 

 

5

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

Consolidated Statements of Operations

(in thousands, except per share data)

 

     Three Months Ended
June 30,		     Six Months Ended
June 30,		  
     2012     2011     2012     2011  

Revenues:

         

Rooms

    $ 110,132      $ 108,812      $ 204,642      $ 200,282   

Food and beverage

      71,931        74,441        134,410        137,323   

Other hotel operating revenue

      18,173        19,948        38,298        39,921   

Lease revenue

      1,165        1,277        2,330        2,492   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total revenues

      201,401        204,478        379,680        380,018   
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating Costs and Expenses:

         

Rooms

      29,983        29,818        58,559        56,445   

Food and beverage

      48,317        50,658        95,710        96,665   

Other departmental expenses

      51,084        53,825        100,649        104,498   

Management fees

      6,214        6,550        11,830        12,324   

Other hotel expenses

      12,763        13,467        26,372        26,825   

Lease expense

      1,143        1,257        2,311        2,453   

Depreciation and amortization

      25,277        30,091        50,767        60,696   

Corporate expenses

      2,866        11,957        16,676        26,434   
  

 

 

    

 

 

    

 

 

    

 

 

  

Total operating costs and expenses

      177,647        197,623        362,874        386,340   
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating income (loss)

      23,754        6,855        16,806        (6,322 ) 

Interest expense

      (19,080 )      (25,762 )      (38,685 )      (45,310 ) 

Interest income

      50        51        80        83   

Loss on early extinguishment of debt

      —          (838 )      —          (838 ) 

Loss on early termination of derivative financial instruments

      —          (29,242 )      —          (29,242 ) 

Equity in (losses) earnings of unconsolidated affiliates

      (717 )      (2,799 )      203        (4,399 ) 

Foreign currency exchange (loss) gain

      (168 )      147        (173 )      286   

Other income, net

      477        436        929        4,361   
  

 

 

    

 

 

    

 

 

    

 

 

  

Income (loss) before income taxes and discontinued operations

      4,316        (51,152 )      (20,840 )      (81,381 ) 

Income tax (expense) benefit

      (350 )      (1,060 )      (815 )      588   
  

 

 

    

 

 

    

 

 

    

 

 

  

Income (loss) from continuing operations

      3,966        (52,212 )      (21,655 )      (80,793 ) 

(Loss) income from discontinued operations, net of tax

      (535 )      101,034        (535 )      101,196   
  

 

 

    

 

 

    

 

 

    

 

 

  

Net income (loss)

      3,431        48,822        (22,190 )      20,403   

Net (income) loss attributable to the noncontrolling interests in SHR's operating partnership

      (8 )      (224 )      109        (86 ) 

Net income attributable to the noncontrolling interests in consolidated affiliates

      (379 )      (1,338 )      (350 )      (743 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net income (loss) attributable to SHR

      3,044        47,260        (22,431 )      19,574   

Preferred shareholder dividends

      (6,042 )      (7,722 )      (12,083 )      (15,443 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Net (loss) income attributable to SHR common shareholders

    $ (2,998 )    $ 39,538      $ (34,514 )    $ 4,131   
  

 

 

    

 

 

    

 

 

    

 

 

  

Basic and Diluted (Loss) Income Per Share:

         

Loss from continuing operations attributable to SHR common shareholders

    $ (0.01 )    $ (0.35 )    $ (0.18 )    $ (0.58 ) 

(Loss) income from discontinued operations attributable to SHR common shareholders

      —          0.57        —          0.60   
  

 

 

    

 

 

    

 

 

    

 

 

  

Net (loss) income attributable to SHR common shareholders

    $ (0.01 )    $ 0.22      $ (0.18 )    $ 0.02   
  

 

 

    

 

 

    

 

 

    

 

 

  

Weighted average common shares outstanding

      202,021        176,141        194,979        166,820   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

6

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012 and December 31, 2011

Consolidated Balance Sheets

(in thousands, except share data)

 

     June 30,     December 31,  
     2012     2011  

Assets

     

Investment in hotel properties, net

    $ 1,661,252      $ 1,692,431   

Goodwill

      40,359        40,359   

Intangible assets, net of accumulated amortization of $9,754 and $8,915

      30,147        30,635   

Investment in unconsolidated affiliates

      119,354        126,034   

Cash and cash equivalents

      76,180        72,013   

Restricted cash and cash equivalents

      46,243        39,498   

Accounts receivable, net of allowance for doubtful accounts of $1,547 and $1,698

      54,135        43,597   

Deferred financing costs, net of accumulated amortization of $5,309 and $3,488

      9,044        10,845   

Deferred tax assets

      1,964        2,230   

Prepaid expenses and other assets

      40,864        29,047   
  

 

 

    

 

 

  

Total assets

    $ 2,079,542      $ 2,086,689   
  

 

 

    

 

 

  

Liabilities, Noncontrolling Interests and Equity

     

Liabilities:

     

Mortgages and other debt payable

    $ 995,817      $ 1,000,385   

Bank credit facility

      50,000        50,000   

Accounts payable and accrued expenses

      228,936        249,179   

Distributions payable

      —          72,499   

Deferred tax liabilities

      47,509        47,623   
  

 

 

    

 

 

  

Total liabilities

      1,322,262        1,419,686   

Noncontrolling interests in SHR’s operating partnership

      5,513        4,583   

Equity:

     

SHR’s shareholders’ equity:

     

8.50% Series A Cumulative Redeemable Preferred Stock ($0.01 par value per share; 4,148,141 shares issued and outstanding; liquidation preference $25.00 per share plus accrued distributions and $103,704 and $130,148 in the aggregate)

      99,995        99,995   

8.25% Series B Cumulative Redeemable Preferred Stock ($0.01 par value per share; 3,615,375 shares issued and outstanding; liquidation preference $25.00 per share plus accrued distributions and $90,384 and $112,775 in the aggregate)

      87,064        87,064   

8.25% Series C Cumulative Redeemable Preferred Stock ($0.01 par value per share; 3,827,727 shares issued and outstanding; liquidation preference $25.00 per share plus accrued distributions and $95,693 and $119,377 in the aggregate)

      92,489        92,489   

Common shares ($0.01 par value per share; 350,000,000 and 250,000,000 common shares authorized; 204,308,710 and 185,627,199 common shares issued and outstanding)

      2,043        1,856   

Additional paid-in capital

      1,738,416        1,634,067   

Accumulated deficit

      (1,213,052 )      (1,190,621 ) 

Accumulated other comprehensive loss

      (62,853 )      (70,652 ) 
  

 

 

    

 

 

  

Total SHR’s shareholders’ equity

      744,102        654,198   

Noncontrolling interests in consolidated affiliates

      7,665        8,222   
  

 

 

    

 

 

  

Total equity

      751,767        662,420   
  

 

 

    

 

 

  

Total liabilities, noncontrolling interests and equity

    $ 2,079,542      $ 2,086,689   
  

 

 

    

 

 

  

 

7

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

Discontinued Operations

The results of operations of hotels sold are classified as discontinued operations and segregated in the consolidated statements of operations for all periods presented. The following hotel was sold during 2011 (in thousands):

 

Hotel

    Date Sold      Net Sales Proceeds  

Paris Marriott Champs Elysees (Paris Marriott)

      April 6, 2011       $ 60,003   

The following is a summary of (loss) income from discontinued operations for the three and six months ended June 30, 2012 and 2011 (in thousands):

 

     Three Months Ended
June 30,		     Six Months Ended
June 30,		  
     2012     2011     2012     2011  

Hotel operating revenues

    $ —        $ 938      $ —        $ 9,743   
  

 

 

    

 

 

    

 

 

    

 

 

  

Operating costs and expenses

      —          828        —          9,510   

Operating income

      —          110        —          233   

Foreign currency exchange (loss) gain

      (535 )      (7 )      (535 )      51   

Other income, net

      —          —          —          326   

Income tax expense

      —          (20 )      —          (379 ) 

Gain on sale

      —          100,951        —          100,965   
  

 

 

    

 

 

    

 

 

    

 

 

  

(Loss) income from discontinued operations

    $ (535 )    $ 101,034      $ (535 )    $ 101,196   
  

 

 

    

 

 

    

 

 

    

 

 

  

 

8

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

Investments in the Hotel del Coronado and Fairmont Scottsdale Princess Hotel

(in thousands)

On January 9, 2006, we purchased a 45% interest in the unconsolidated affiliate that owns the Hotel del Coronado. On February 4, 2011, we completed a recapitalization of the unconsolidated affiliate. As part of the recapitalization, a new unconsolidated affiliate was formed to own the Hotel del Coronado and to invest cash in the asset. Pursuant to the terms of the recapitalization, we became a limited partner in the new unconsolidated affiliate, and our ownership interest in the Hotel del Coronado decreased from 45% to 34.3%. On June 9, 2011, we completed a recapitalization of the Fairmont Scottsdale Princess hotel. As part of the recapitalization, our ownership interest in the Fairmont Scottsdale Princess hotel decreased from 100% to 50%. We account for these investments using the equity method of accounting.

 

     Three Months Ended
June 30, 2012		     Three Months Ended
June 30, 2011		  
     Hotel del
Coronado		     Fairmont
Scottsdale
Princess		     Total     Hotel del
Coronado		     Fairmont
Scottsdale
Princess		     Total  

Total revenues (100%)

    $ 34,511      $ 19,145      $ 53,656      $ 33,685      $ 2,109      $ 35,794   

Property EBITDA (100%)

    $ 10,743      $ 3,251      $ 13,994      $ 10,455      $ (744 )    $ 9,711   

Equity in losses of unconsolidated affiliates (SHR ownership)

             

Property EBITDA

    $ 3,685      $ 1,626      $ 5,311      $ 3,586      $ (372 )    $ 3,214   

Depreciation and amortization

      (1,698 )      (1,776 )      (3,474 )      (1,663 )      (451 )      (2,114 ) 

Interest expense

      (2,504 )      (195 )      (2,699 )      (2,429 )      (50 )      (2,479 ) 

Other expenses, net

      (20 )      19        (1 )      (725 )      (544 )      (1,269 ) 

Income taxes

      100        —          100        102        —          102   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity in losses of unconsolidated affiliates

    $ (437 )    $ (326 )    $ (763 )    $ (1,129 )    $ (1,417 )    $ (2,546 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA Contribution:

             

Equity in losses of unconsolidated affiliates

    $ (437 )    $ (326 )    $ (763 )    $ (1,129 )    $ (1,417 )    $ (2,546 ) 

Depreciation and amortization

      1,698        1,776        3,474        1,663        451        2,114   

Interest expense

      2,504        195        2,699        2,429        50        2,479   

Income taxes

      (100 )      —          (100 )      (102 )      —          (102 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA Contribution

    $ 3,665      $ 1,645      $ 5,310      $ 2,861      $ (916 )    $ 1,945   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

FFO Contribution:

             

Equity in losses of unconsolidated affiliates

    $ (437 )    $ (326 )    $ (763 )    $ (1,129 )    $ (1,417 )    $ (2,546 ) 

Depreciation and amortization

      1,698        1,776        3,474        1,663        451        2,114   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

FFO Contribution

    $ 1,261      $ 1,450      $ 2,711      $ 534      $ (966 )    $ (432 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

     Six Months Ended
June 30, 2012		     Six Months Ended
June 30, 2011		  
     Hotel del
Coronado		     Fairmont
Scottsdale
Princess		     Total     Hotel del
Coronado		     Fairmont
Scottsdale
Princess		     Total  

Total revenues (100%)

    $ 65,354      $ 46,128      $ 111,482      $ 62,987      $ 2,109      $ 65,096   

Property EBITDA (100%)

    $ 18,961      $ 11,906      $ 30,867      $ 17,753      $ (744 )    $ 17,009   

Equity in (losses) earnings of unconsolidated affiliates (SHR ownership)

             

Property EBITDA

    $ 6,504      $ 5,953      $ 12,457      $ 6,192      $ (372 )    $ 5,820   

Depreciation and amortization

      (3,387 )      (3,547 )      (6,934 )      (3,298 )      (451 )      (3,749 ) 

Interest expense

      (5,022 )      (398 )      (5,420 )      (4,734 )      (50 )      (4,784 ) 

Other expenses, net

      (43 )      (39 )      (82 )      (1,464 )      (544 )      (2,008 ) 

Income taxes

      367        —          367        679        —          679   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Equity in (losses) earnings of unconsolidated affiliates

    $ (1,581 )    $ 1,969      $ 388      $ (2,625 )    $ (1,417 )    $ (4,042 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA Contribution

             

Equity in (losses) earnings of unconsolidated affiliates

    $ (1,581 )    $ 1,969      $ 388      $ (2,625 )    $ (1,417 )    $ (4,042 ) 

Depreciation and amortization

      3,387        3,547        6,934        3,298        451        3,749   

Interest expense

      5,022        398        5,420        4,734        50        4,784   

Income taxes

      (367 )      —          (367 )      (679 )      —          (679 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA Contribution

    $ 6,461      $ 5,914      $ 12,375      $ 4,728      $ (916 )    $ 3,812   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

FFO Contribution

             

Equity in (losses) earnings of unconsolidated affiliates

    $ (1,581 )    $ 1,969      $ 388      $ (2,625 )    $ (1,417 )    $ (4,042 ) 

Depreciation and amortization

      3,387        3,547        6,934        3,298        451        3,749   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

FFO Contribution

    $ 1,806      $ 5,516      $ 7,322      $ 673      $ (966 )    $ (293 ) 
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

Debt

    Interest Rate     Spread over
LIBOR		     Loan Amount     Maturity (a)

Hotel del Coronado

         

CMBS Mortgage and Mezzanine

      5.80 %(b)      480 bp (b)    $ 425,000      March 2016

Cash and cash equivalents

          (11,068 )   
      

 

 

    

Net Debt

        $ 413,932     
      

 

 

    

Fairmont Scottsdale Princess

         

CMBS Mortgage

      0.61 %      36 bp      $ 133,000      April 2015

Cash and cash equivalents

          (3,926 )   
      

 

 

    

Net Debt

        $ 129,074     
      

 

 

    

 

(a) Includes extension options.
(b) Subject to a 1% LIBOR floor.

 

Caps

   Effective
Date		     LIBOR Cap Rate     Notional Amount     Maturity

Hotel del Coronado

        

CMBS Mortgage and Mezzanine Loan Caps

     February 2011        2.00 %    $ 425,000      February 2013

CMBS Mortgage and Mezzanine Loan Caps

     February 2013        2.50 %    $ 425,000      March 2013

Fairmont Scottsdale Princess

        

CMBS Mortgage Loan Cap

     June 2011        4.00 %    $ 133,000      December 2013

 

9

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

Leasehold Information

(in thousands)

 

     Three Months Ended
June 30,		     Six Months Ended
June 30,		  
     2012     2011     2012     2011  

Paris Marriott (a):

         

Property EBITDA

    $ —        $ 206      $ —        $ 3,455   

Revenue (b)

    $ —        $ 206      $ —        $ 3,455   

Lease expense

      —          (223 )      —          (3,274 ) 

Less: Deferred gain on sale-leaseback

      —          (62 )      —          (1,214 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted lease expense

      —          (285 )      —          (4,488 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA contribution from leasehold

    $ —        $ (79 )    $ —        $ (1,033 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Marriott Hamburg:

         

Property EBITDA

    $ 1,496      $ 1,844      $ 2,896      $ 3,300   

Revenue (b)

    $ 1,165      $ 1,277      $ 2,330      $ 2,492   

Lease expense

      (1,143 )      (1,257 )      (2,311 )      (2,453 ) 

Less: Deferred gain on sale-leaseback

      (50 )      (56 )      (101 )      (109 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted lease expense

      (1,193 )      (1,313 )      (2,412 )      (2,562 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA contribution from leasehold

    $ (28 )    $ (36 )    $ (82 )    $ (70 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Total Leaseholds:

         

Property EBITDA

    $ 1,496      $ 2,050      $ 2,896      $ 6,755   

Revenue (b)

    $ 1,165      $ 1,483      $ 2,330      $ 5,947   

Lease expense

      (1,143 )      (1,480 )      (2,311 )      (5,727 ) 

Less: Deferred gain on sale-leasebacks

      (50 )      (118 )      (101 )      (1,323 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

Adjusted lease expense

      (1,193 )      (1,598 )      (2,412 )      (7,050 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA contribution from leaseholds

    $ (28 )    $ (115 )    $ (82 )    $ (1,103 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  

 

Security Deposit (c):    June 30,
2012		      December 31,
2011		  

Marriott Hamburg

    $ 2,406       $ 2,462   

 

(a) On April 6, 2011, we sold our leasehold interest in the Paris Marriott hotel. The results of operations for the Paris Marriott hotel have been classified as discontinued operations for all periods presented.
(b) For the three and six months ended June 30, 2011, Revenue for the Paris Marriott hotel represents Property EBITDA. For the three and six months ended June 30, 2012 and 2011, Revenue for the Marriott Hamburg hotel represents lease revenue.
(c) The security deposit is recorded in other assets on the consolidated balance sheets.

 

10

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

Non-GAAP Financial Measures

We present five non-GAAP financial measures that we believe are useful to management and investors as key measures of our operating performance: Funds from Operations (FFO); FFO—Fully Diluted; Comparable FFO; Earnings Before Interest Expense, Taxes, Depreciation and Amortization (EBITDA); and Comparable EBITDA.

EBITDA represents net income (or loss) attributable to SHR common shareholders excluding: (i) interest expense, (ii) income taxes, including deferred income tax benefits and expenses applicable to our foreign subsidiaries and income taxes applicable to sale of assets; (iii) depreciation and amortization; and (iv) preferred stock dividends. EBITDA also excludes interest expense, income taxes and depreciation and amortization of our unconsolidated affiliates. EBITDA is presented on a full participation basis, which means we have assumed conversion of all redeemable noncontrolling interests of our operating partnership into our common stock. We believe this treatment of noncontrolling interests provides useful information for management and our investors and appropriately considers our current capital structure. We also present Comparable EBITDA, which eliminates the effect of realizing deferred gains on our sale leasebacks, as well as the effect of gains or losses on sales of assets, early extinguishment of debt, impairment losses, foreign currency exchange gains or losses and the Value Creation Plan expense. We believe EBITDA and Comparable EBITDA are useful to management and investors in evaluating our operating performance because they provide management and investors with an indication of our ability to incur and service debt, to satisfy general operating expenses, to make capital expenditures and to fund other cash needs or reinvest cash into our business. We also believe they help management and investors meaningfully evaluate and compare the results of our operations from period to period by removing the impact of our asset base (primarily depreciation and amortization) from our operating results. Our management also uses EBITDA and Comparable EBITDA as measures in determining the value of acquisitions and dispositions.

We compute FFO in accordance with standards established by the National Association of Real Estate Investment Trusts, or NAREIT, with the exception of impairment of depreciable real estate. NAREIT adopted a definition of FFO in order to promote an industry-wide standard measure of REIT operating performance. NAREIT defines FFO as net income (or loss) (computed in accordance with GAAP) excluding losses or gains from sales of depreciable property, impairment of depreciable real estate, real estate-related depreciation and amortization, and our portion of these items related to unconsolidated affiliates. We also present FFO—Fully Diluted, which is FFO plus income or loss on income attributable to redeemable noncontrolling interests in our operating partnership. We also present Comparable FFO, which is FFO—Fully Diluted excluding the impact of any gains or losses on early extinguishment of debt, impairment losses, foreign currency exchange gains or losses and the Value Creation Plan expense. We believe that the presentation of FFO, FFO—Fully Diluted and Comparable FFO provides useful information to management and investors regarding our results of operations because they are measures of our ability to fund capital expenditures and expand our business. In addition, FFO is widely used in the real estate industry to measure operating performance without regard to items such as depreciation and amortization. We also present Comparable FFO per diluted share as a non-GAAP measure of our performance. We calculate Comparable FFO per diluted share for a given operating period as our Comparable FFO (as defined above) divided by the weighted average of fully diluted shares outstanding. Comparable FFO per diluted share, in accordance with NAREIT, is adjusted for the effects of dilutive securities. Dilutive securities may include shares granted under share-based compensation plans, operating partnership units and exchangeable debt securities. No effect is shown for securities that are anti-dilutive.

We caution investors that amounts presented in accordance with our definitions of FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA may not be comparable to similar measures disclosed by other companies, since not all companies calculate these non-GAAP measures in the same manner. FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA should not be considered as an alternative measure of our net income (or loss) or operating performance. FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA may include funds that may not be available for our discretionary use due to functional requirements to conserve funds for capital expenditures and property acquisitions and other commitments and uncertainties. Although we believe that FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA can enhance your understanding of our financial condition and results of operations, these non-GAAP financial measures, when viewed individually, are not necessarily a better indicator of any trend as compared to comparable GAAP measures such as net income (or loss) attributable to SHR common shareholders. In addition, you should be aware that adverse economic and market conditions might negatively impact our cash flow. We have provided a quantitative reconciliation of FFO, FFO—Fully Diluted, Comparable FFO, EBITDA, and Comparable EBITDA to the most directly comparable GAAP financial performance measure, which is net income (or loss) attributable to SHR common shareholders.

 

11

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

Reconciliation of Net (Loss) Income Attributable to SHR Common Shareholders to EBITDA and Comparable EBITDA

(in thousands)

 

    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2012     2011     2012     2011  

Net (loss) income attributable to SHR common shareholders

   $ (2,998 )    $ 39,538      $ (34,514 )    $ 4,131   

Depreciation and amortization

     25,277        30,091        50,767        60,696   

Interest expense

     19,080        25,762        38,685        45,310   

Income taxes—continuing operations

     350        1,060        815        (588 ) 

Income taxes—discontinued operations

     —          20        —          379   

Noncontrolling interests

     8        224        (109 )      86   

Adjustments from consolidated affiliates

     (1,246 )      (2,854 )      (2,503 )      (4,183 ) 

Adjustments from unconsolidated affiliates

     6,888        5,241        13,570        9,131   

Preferred shareholder dividends

     6,042        7,722        12,083        15,443   
 

 

 

    

 

 

    

 

 

    

 

 

  

EBITDA

     53,401        106,804        78,794        130,405   

Realized portion of deferred gain on sale-leaseback—continuing operations

     (50 )      (56 )      (101 )      (109 ) 

Realized portion of deferred gain on sale-leaseback—discontinued operations

     —          (62 )      —          (1,214 ) 

Gain on sale of assets—continuing operations

     —          —          —          (2,640 ) 

Gain on sale of assets— discontinued operations

     —          (100,951 )      —          (100,965 ) 

Loss on early extinguishment of debt

     —          838        —          838   

Loss on early termination of derivative financial instruments

     —          29,242        —          29,242   

Foreign currency exchange loss (gain)—continuing operations (a)

     168        (147 )      173        (286 ) 

Foreign currency exchange loss (gain)—discontinued operations (a)

     535        7        535        (51 ) 

Adjustment for Value Creation Plan

     (3,167 )      6,818        4,772        15,999   
 

 

 

    

 

 

    

 

 

    

 

 

  

Comparable EBITDA

   $ 50,887      $ 42,493      $ 84,173      $ 71,219   
 

 

 

    

 

 

    

 

 

    

 

 

  

 

(a) Foreign currency exchange gains or losses applicable to third-party and inter-company debt and certain balance sheet items held by foreign subsidiaries.

 

12

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

Reconciliation of Net (Loss) Income Attributable to SHR Common Shareholders to

Funds From Operations (FFO), FFO—Fully Diluted and Comparable FFO

(in thousands, except per share data)

 

    Three Months Ended     Six Months Ended  
    June 30,     June 30,  
    2012     2011     2012     2011  

Net (loss) income attributable to SHR common shareholders

   $ (2,998 )    $ 39,538      $ (34,514 )    $ 4,131   

Depreciation and amortization

     25,277        30,091        50,767        60,696   

Corporate depreciation

     (264 )      (290 )      (529 )      (589 ) 

Gain on sale of assets—continuing operations

     —          —          —          (2,640 ) 

Gain on sale of assets—discontinued operations

     —          (100,951 )      —          (100,965 ) 

Realized portion of deferred gain on sale-leaseback—continuing operations

     (50 )      (56 )      (101 )      (109 ) 

Realized portion of deferred gain on sale-leaseback—discontinued operations

     —          (62 )      —          (1,214 ) 

Deferred tax expense on realized portion of deferred gain on sale-leasebacks

     —          20        —          379   

Noncontrolling interests adjustments

     (120 )      (149 )      (253 )      (306 ) 

Adjustments from consolidated affiliates

     (659 )      (1,598 )      (1,326 )      (3,159 ) 

Adjustments from unconsolidated affiliates

     3,779        2,414        7,543        4,253   
 

 

 

    

 

 

    

 

 

    

 

 

  

FFO

     24,965        (31,043 )      21,587        (39,523 ) 

Redeemable noncontrolling interests

     128        373        144        392   
 

 

 

    

 

 

    

 

 

    

 

 

  

FFO—Fully Diluted

     25,093        (30,670 )      21,731        (39,131 ) 

Non-cash mark to market of interest rate swaps

     (1,187 )      2,733        (2,717 )      (1,633 ) 

Loss on early extinguishment of debt

     —          838        —          838   

Loss on early termination of derivative financial instruments

     —          29,242        —          29,242   

Foreign currency exchange loss (gain)—continuing operations (a)

     168        (147 )      173        (286 ) 

Foreign currency exchange loss (gain)—discontinued operations (a)

     535        7        535        (51 ) 

Adjustment for Value Creation Plan

     (3,167 )      6,818        4,772        15,999   
 

 

 

    

 

 

    

 

 

    

 

 

  

Comparable FFO

   $ 21,442      $ 8,821      $ 24,494      $ 4,978   
 

 

 

    

 

 

    

 

 

    

 

 

  

Comparable FFO per diluted share

   $ 0.11      $ 0.05      $ 0.12      $ 0.03   
 

 

 

    

 

 

    

 

 

    

 

 

  

Weighted average diluted shares

     204,099        178,488        197,133        169,379   
 

 

 

    

 

 

    

 

 

    

 

 

  

 

(a) Foreign currency exchange gains or losses applicable to third-party and inter-company debt and certain balance sheet items held by foreign subsidiaries.

 

13

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

Debt Summary

(dollars in thousands)

 

Debt

    Interest Rate     Spread (a)   Loan Amount      Maturity (b)

Hyatt Regency La Jolla

      1.25 %    100 bp   $ 97,500       September 2012

North Beach Venture

      5.00 %    Fixed     1,476       January 2013

Marriott London Grosvenor Square (c)

      2.00 %    110 bp (c)     113,226       October 2013

Bank credit facility

      3.25 %    300 bp     50,000       June 2015

Four Seasons Washington, D.C.

      3.40 %    315 bp     130,000       July 2016

Westin St. Francis

      6.09 %    Fixed     217,137       June 2017

Fairmont Chicago

      6.09 %    Fixed     96,478       June 2017

InterContinental Miami

      3.75 %    350 bp     85,000       July 2018

Loews Santa Monica Beach Hotel

      4.10 %    385 bp     110,000       July 2018

InterContinental Chicago

      5.61 %    Fixed     145,000       August 2021
      

 

 

     
       $ 1,045,817      
      

 

 

     

 

(a) Spread over LIBOR (0.25% at June 30, 2012).
(b) Includes extension options.
(c) Principal balance of £72,100,000 at June 30, 2012. Spread over three-month GBP LIBOR (0.90% at June 30, 2012).

Domestic and European Interest Rate Swaps

 

Swap Effective Date

    Fixed Pay Rate
Against LIBOR		     Notional
Amount		      Maturity

February 2010

      4.90 %    $ 100,000       September 2014

February 2010

      4.96 %      100,000       December 2014

December 2010

      5.23 %      100,000       December 2015

February 2011

      5.27 %      100,000       February 2016
  

 

 

    

 

 

     
     5.09 %    $ 400,000      
  

 

 

    

 

 

     

 

Swap Effective Date

    Fixed Pay Rate
Against GBP LIBOR		     Notional
Amount		      Maturity  

October 2007

      5.72 %    £ 72,100         October 2013   

At June 30, 2012, future scheduled debt principal payments (including extension options) are as follows:

 

Years ending December 31,

    Amount  

2012

    $ 103,380   

2013

      123,950   

2014

      13,872   

2015

      65,046   

2016

      145,861   

Thereafter

      593,708   
  

 

 

  
   $ 1,045,817   
  

 

 

  

Percent of fixed rate debt including U.S. and European swaps

      93.1 % 

Weighted average interest rate including U.S. and European swaps (d)

      6.63 % 

Weighted average maturity of fixed rate debt (debt with maturity of greater than one year)

      4.30   

 

(d) Excludes the amortization of deferred financing costs and the amortization of the interest rate swap costs.

 

14

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

Portfolio Data

Portfolio at June 30, 2012

(dollars in thousands)

 

Hotel

    Location    Number
of
Rooms		      % of
Total
Rooms		     % of QTR
June 2012
Property
EBITDA		     QTR
June
2012
Property
EBITDA		  

United States:

             

Westin St. Francis

    San Francisco, CA      1,195         15 %      13 %    $ 7,573   

InterContinental Chicago (a)

    Chicago, IL      792         10 %      11 %      6,692   

Hotel del Coronado (b)

    Coronado, CA      757         10 %      6 %      3,685   

Fairmont Chicago

    Chicago, IL      687         9 %      9 %      4,978   

Fairmont Scottsdale Princess (c)

    Scottsdale, AZ      649         8 %      3 %      1,626   

InterContinental Miami

    Miami, FL      641         8 %      6 %      3,419   

Hyatt Regency La Jolla (d)

    La Jolla, CA      419         5 %      4 %      2,328   

Ritz-Carlton Laguna Niguel

    Dana Point, CA      396         5 %      12 %      6,725   

Marriott Lincolnshire Resort

    Lincolnshire, IL      389         5 %      1 %      431   

Loews Santa Monica Beach Hotel

    Santa Monica, CA      342         5 %      6 %      3,603   

Ritz-Carlton Half Moon Bay

    Half Moon Bay, CA      261         3 %      6 %      3,758   

Four Seasons Washington, D.C.

    Washington, D.C.      222         3 %      9 %      5,195   

Four Seasons Silicon Valley (e)

    East Palo Alto, CA      200         3 %      4 %      2,167   

Four Seasons Jackson Hole (e)

    Teton Village, WY      124         2 %      -1 %      (501 ) 
     

 

 

     

 

 

    

 

 

    

 

 

  

Total United States

         7,074         91 %      89 %      51,679   
     

 

 

     

 

 

    

 

 

    

 

 

  

Mexican:

             

Four Seasons Punta Mita Resort

    Punta Mita, Mexico      173         2 %      3 %      1,618   
     

 

 

     

 

 

    

 

 

    

 

 

  

Total Mexican

         173         2 %      3 %      1,618   
     

 

 

     

 

 

    

 

 

    

 

 

  

Total North American

         7,247         93 %      92 %      53,297   

European:

             

Marriott Hamburg (f)

    Hamburg, Germany      278         4 %      N/A        N/A   

Marriott London Grosvenor Square

    London, England      237         3 %      8 %      4,538   
     

 

 

     

 

 

    

 

 

    

 

 

  

Total European

         515         7 %      8 %      4,538   
     

 

 

     

 

 

    

 

 

    

 

 

  
        7,762         100 %      100 %    $ 57,835   
     

 

 

     

 

 

    

 

 

    

 

 

  

 

(a) Prior to June 24, 2011, we owned a 51% controlling interest in the entity that owns the InterContinental Chicago hotel and consolidated this hotel for reporting purposes. On June 24, 2011, we purchased the remaining 49% interest and now own 100% of this hotel.
(b) Prior to February 4, 2011, we owned a 45% interest in the unconsolidated affiliate that owns the Hotel del Coronado. On February 4, 2011, we completed a recapitalization of the unconsolidated affiliate and our ownership interest decreased from 45% to 34.3%. We account for this investment under the equity method of accounting and record equity in (losses) earnings of the unconsolidated affiliate in our consolidated statements of operations. Property EBITDA has been calculated based on our 34.3% ownership.
(c) Prior to June 9, 2011, we owned 100% of the Fairmont Scottsdale Princess hotel. On June 9, 2011, we completed a recapitalization of the entity and our ownership interest decreased to 50%. We now account for this investment under the equity method of accounting and record equity in earnings (losses) of the unconsolidated affiliate in our consolidated statements of operations. Property EBITDA has been calculated based on our 50.0% ownership.
(d) Prior to June 24, 2011, we owned a 51% controlling interest in the entity that owns the Hyatt Regency La Jolla hotel. On June 24, 2011, we purchased an additional 2.5% interest and continue to consolidate this hotel for reporting purposes.

 

(e) On March 11, 2011, we purchased these hotels.
(f) We sublease this property and have not included it in the percentage of Property EBITDA calculation.

 

15

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Four Quarters Ended June 30, 2012

Seasonality by Geographic Region

(dollars in thousands)

Same store property revenues have been adjusted to show hotel performance on a comparable quarter-over-quarter basis. Adjustments include (i) exclusion of Paris Marriott hotel as its results of operations were reclassified to discontinued operations, (ii) exclusion of the unconsolidated Hotel del Coronado and Fairmont Scottsdale Princess hotel and (iii) presentation of the hotels without regard to either ownership structure or leaseholds.

United States Hotels (as of June 30, 2012)

Same store property revenues—12 Properties and 5,668 Rooms

 

     Three Months Ended        
     September 30, 2011     December 31, 2011     March 31, 2012     June 30, 2012     Total  

Same store property revenues

    $ 174,347      $ 171,798      $ 159,384      $ 182,367      $ 687,896   

Pro forma seasonality %

      25.3 %      25.0 %      23.2 %      26.5 %      100.0 % 

Mexican Hotel (as of June 30, 2012)

Same store property revenues—1 Property and 173 Rooms

 

     Three Months Ended        
     September 30, 2011     December 31, 2011     March 31, 2012     June 30, 2012     Total  

Same store property revenues

    $ 4,457      $ 10,181      $ 9,930      $ 8,153      $ 32,721   

Same store seasonality %

      13.6 %      31.1 %      30.4 %      24.9 %      100.0 % 

North American Hotels (as of June 30, 2012)

Same store property revenues—13 Properties and 5,841 Rooms

 

     Three Months Ended        
     September 30, 2011     December 31, 2011     March 31, 2012     June 30, 2012     Total  

Same store property revenues

    $ 178,804      $ 181,979      $ 169,314      $ 190,520      $ 720,617   

Same store seasonality %

      24.8 %      25.3 %      23.5 %      26.4 %      100.0 % 

European Hotels (as of June 30, 2012)

Same store property revenues—2 Properties and 515 Rooms

 

     Three Months Ended        
     September 30, 2011     December 31, 2011     March 31, 2012     June 30, 2012     Total  

Same store property revenues

    $ 15,832      $ 16,230      $ 12,477      $ 15,303      $ 59,842   

Same store seasonality %

      26.5 %      27.1 %      20.8 %      25.6 %      100.0 % 

 

16

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

Operating Statistics by Geographic Region

The Total United States portfolio is derived from our hotel portfolio at June 30, 2012, consisting of all properties located in the United States, including the Four Seasons Jackson Hole hotel, the Four Seasons Silicon Valley hotel and 100% of the operations of the Hotel del Coronado and the Fairmont Scottsdale Princess hotel. The Total North American portfolio includes the Total United States portfolio and the Four Seasons Punta Mita Resort. Adjustments to the same store portfolios are the (i) exclusion of unconsolidated Hotel del Coronado and Fairmont Scottsdale Princess hotel, (ii) exclusion of Four Seasons Jackson Hole and Four Seasons Silicon Valley hotels for the six months ended June 30, 2012 and 2011, (iii) exclusion of Paris Marriott hotel as this property's results of operations were reclassified to discontinued operations for the periods presented and (iv) presentation of the hotels without regard to either ownership structure or leaseholds.

Total United States Hotels (as of June 30, 2012)

14 Properties

7,074 Rooms

 

     Three Months Ended
June  30,		     Six Months Ended
June  30,		  
     2012     2011     Change     2012     2011     Change  

ADR

    $ 257.16      $ 241.93        6.3 %    $ 254.47      $ 240.78        5.7 % 

Average Occupancy

      75.1 %      73.3 %      1.8 pts      71.9 %      69.9 %      2.0 pts 

RevPAR

    $ 193.19      $ 177.41        8.9 %    $ 183.03      $ 168.20        8.8 % 

Total RevPAR

    $ 368.20      $ 344.22        7.0 %    $ 353.53      $ 329.40        7.3 % 

Property EBITDA Margin

      25.6 %      24.0 %      1.6 pts      23.0 %      21.1 %      1.9 pts 

Total North American Hotels (as of June 30, 2012)

15 Properties

7,247 Rooms

 

     Three Months Ended
June  30,		     Six Months Ended
June  30,		  
     2012     2011     Change     2012     2011     Change  

ADR

    $ 261.45      $ 247.25        5.7 %    $ 260.47      $ 247.80        5.1 % 

Average Occupancy

      74.5 %      72.7 %      1.8 pts      71.3 %      69.3 %      2.0 pts 

RevPAR

    $ 194.76      $ 179.69        8.4 %    $ 185.82      $ 171.80        8.2 % 

Total RevPAR

    $ 371.79      $ 349.05        6.5 %    $ 358.82      $ 336.17        6.7 % 

Property EBITDA Margin

      25.4 %      23.9 %      1.5 pts      23.1 %      21.4 %      1.7 pts 

Same Store North American Hotels (as of June 30, 2012)

13 Properties (three month period) 11 Properties (six month period)

5,841 Rooms (three month period) 5,517 Rooms (six month period)

 

     Three Months Ended
June  30,		     Six Months Ended
June  30,		  
     2012     2011     Change     2012     2011     Change  

ADR

    $ 253.70      $ 239.77        5.8 %    $ 244.04      $ 231.47        5.4 % 

Average Occupancy

      76.5 %      74.0 %      2.5 pts      72.2 %      69.8 %      2.4 pts 

RevPAR

    $ 194.11      $ 177.35        9.5 %    $ 176.28      $ 161.49        9.2 % 

Total RevPAR

    $ 360.28      $ 333.34        8.1 %    $ 328.00      $ 304.91        7.6 % 

Property EBITDA Margin

      25.2 %      23.4 %      1.8 pts      22.0 %      20.5 %      1.5 pts 

Same Store European Hotels (as of June 30, 2012)

2 Properties

515 Rooms

 

     Three Months Ended
June 30,		     Six Months Ended
June 30,		  
     2012     2011     Change     2012     2011     Change  

ADR

    $ 286.09      $ 305.13        (6.2 )%    $ 271.33      $ 277.96        (2.4 )% 

Average Occupancy

      85.5 %      85.8 %      (0.3 )pts      81.5 %      78.4 %      3.1 pts 

RevPAR

    $ 244.66      $ 261.86        (6.6 )%    $ 221.11      $ 217.96        1.4 % 

Total RevPAR

    $ 326.53      $ 349.24        (6.5 )%    $ 296.38      $ 299.10        (0.9 )% 

Property EBITDA Margin

      39.4 %      37.4 %      2.0 pts      37.1 %      35.4 %      1.7 pts 

 

17

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

Selected Financial and Operating Information by Property

(in thousands, except operating information)

The following tables present selected financial and operating information by property for the three and six months ended June 30, 2012 and 2011. Property EBITDA reflects property net operating income or loss plus depreciation and amortization.

 

     Three Months Ended June 30,     Six Months Ended June 30,  
UNITED STATES HOTELS:    2012     2011     Change     2012     2011     Change  

FAIRMONT CHICAGO

             

Selected Financial Information:

             

Total revenues

    $ 18,226      $ 16,526        10.3 %    $ 28,865      $ 25,530        13.1 % 

Property EBITDA

    $ 4,978      $ 4,240        17.4 %    $ 4,632      $ 3,033        52.7 % 

Selected Operating Information:

             

Rooms

      687        687        —          687        687        —     

Average occupancy

      72.6 %      70.7 %      1.9 pts      62.7 %      59.1 %      3.6 pts 

ADR

    $ 244.79      $ 225.24        8.7 %    $ 216.51      $ 202.16        7.1 % 

RevPAR

    $ 177.77      $ 159.35        11.6 %    $ 135.78      $ 119.40        13.7 % 

Total RevPAR

    $ 291.54      $ 264.35        10.3 %    $ 230.86      $ 205.31        12.4 % 

FAIRMONT SCOTTSDALE PRINCESS

             

Selected Financial Information (Amounts below are 100% of operations, of which SHR owns 50% as of June 30, 2012 and

2011, respectively):

  

  

Total revenues

    $ 19,145      $ 19,286        (0.7 )%    $ 46,128      $ 44,643        3.3 % 

Property EBITDA

    $ 3,251      $ 3,158        2.9 %    $ 11,906      $ 10,528        13.1 % 

Selected Operating Information:

             

Rooms

      649        649        —          649        649        —     

Average occupancy

      65.4 %      67.3 %      (1.9 )pts      71.6 %      73.5 %      (1.9 )pts 

ADR

    $ 221.16      $ 211.51        4.6 %    $ 259.74      $ 243.17        6.8 % 

RevPAR

    $ 144.57      $ 142.38        1.5 %    $ 186.03      $ 178.61        4.2 % 

Total RevPAR

    $ 324.17      $ 326.55        (0.7 )%    $ 390.52      $ 380.04        2.8 % 

FOUR SEASONS JACKSON HOLE

             

Selected Financial Information (This table includes financial information only for our period of ownership):

  

Total revenues

    $ 4,466      $ 3,945        13.2 %    $ 16,250        N/A        N/A   

Property EBITDA

    $ (501 )    $ (721 )      30.5 %    $ 2,273        N/A        N/A   

Selected Operating Information (This table includes statistical information only for our period of ownership. For the six months ended June 30, 2011, average occupancy was 57.2%, ADR was $477.66, RevPAR was $272.99 and Total RevPAR was $654.98.):

    

Rooms

      124        124        —          124        N/A        N/A   

Average occupancy

      46.6 %      44.3 %      2.3 pts      60.4 %      N/A        N/A   

ADR

    $ 394.17      $ 361.38        9.1 %    $ 492.59        N/A        N/A   

RevPAR

    $ 183.74      $ 160.00        14.8 %    $ 297.48        N/A        N/A   

Total RevPAR

    $ 395.78      $ 349.65        13.2 %    $ 720.05        N/A        N/A   

FOUR SEASONS SILICON VALLEY

             

Selected Financial Information (This table includes financial information only for our period of ownership):

  

Total revenues

    $ 8,663      $ 7,431        16.6 %    $ 16,025        N/A        N/A   

Property EBITDA

    $ 2,167      $ 1,286        68.5 %    $ 3,625        N/A        N/A   

Selected Operating Information (This table includes statistical information only for our period of ownership. For the six months ended June 30, 2011, average occupancy was 67.0%, ADR was $302.36, RevPAR was $202.63 and Total RevPAR was $386.28.):

    

Rooms

      200        200        —          200        N/A        N/A   

Average occupancy

      77.5 %      69.7 %      7.8 pts      73.2 %      N/A        N/A   

ADR

    $ 323.39      $ 309.58        4.5 %    $ 319.66        N/A        N/A   

RevPAR

    $ 250.49      $ 215.72        16.1 %    $ 234.08        N/A        N/A   

Total RevPAR

    $ 475.97      $ 408.30        16.6 %    $ 440.25        N/A        N/A   

 

18

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2012     2011     Change     2012     2011     Change  

FOUR SEASONS WASHINGTON, D.C.

             

Selected Financial Information:

             

Total revenues

    $ 18,359      $ 17,203        6.7 %    $ 31,887      $ 30,438        4.8 % 

Property EBITDA

    $ 5,195      $ 4,808        8.0 %    $ 7,083      $ 6,835        3.6 % 

Selected Operating Information:

             

Rooms

      222        222        —          222        222        —     

Average occupancy

      81.1 %      79.2 %      1.9 pts      74.6 %      71.6 %      3.0 pts 

ADR

    $ 569.98      $ 549.66        3.7 %    $ 528.29      $ 519.32        1.7 % 

RevPAR

    $ 462.23      $ 435.06        6.2 %    $ 394.12      $ 371.72        6.0 % 

Total RevPAR

    $ 908.78      $ 851.55        6.7 %    $ 789.21      $ 757.50        4.2 % 

HOTEL DEL CORONADO

             

Selected Financial Information (Amounts below are 100% of operations, of which SHR owns 34.3% as of June 30, 2012 and 2011):

   

Total revenues

    $ 34,511      $ 33,685        2.5 %    $ 65,354      $ 62,987        3.8 % 

Property EBITDA

    $ 10,743      $ 10,455        2.8 %    $ 18,961      $ 17,753        6.8 % 

Selected Operating Information:

             

Rooms

      757        757        —          757        757        —     

Average occupancy

      66.8 %      67.4 %      (0.6 )pts      65.9 %      65.2 %      0.7 pts 

ADR

    $ 363.48      $ 340.89        6.6 %    $ 339.51      $ 331.15        2.5 % 

RevPAR

    $ 242.76      $ 229.62        5.7 %    $ 223.77      $ 215.92        3.6 % 

Total RevPAR

    $ 500.98      $ 488.99        2.5 %    $ 474.36      $ 459.70        3.2 % 

HYATT REGENCY LA JOLLA

             

Selected Financial Information:

             

Total revenues

    $ 9,648      $ 8,482        13.7 %    $ 18,413      $ 17,855        3.1 % 

Property EBITDA

    $ 2,328      $ 1,652        40.9 %    $ 4,099      $ 3,349        22.4 % 

Selected Operating Information:

             

Rooms

      419        419        —          419        419        —     

Average occupancy

      80.7 %      74.1 %      6.6 pts      76.0 %      76.2 %      (0.2 )pts 

ADR

    $ 165.93      $ 152.59        8.7 %    $ 166.03      $ 157.58        5.4 % 

RevPAR

    $ 133.84      $ 113.00        18.4 %    $ 126.16      $ 120.12        5.0 % 

Total RevPAR

    $ 253.03      $ 222.46        13.7 %    $ 241.45      $ 235.43        2.6 % 

INTERCONTINENTAL CHICAGO

             

Selected Financial Information:

             

Total revenues

    $ 21,671      $ 19,588        10.6 %    $ 33,101      $ 29,289        13.0 % 

Property EBITDA

    $ 6,692      $ 6,724        (0.5 )%    $ 5,908      $ 6,412        (7.9 )% 

Selected Operating Information:

             

Rooms

      792        792        —          792        792        —     

Average occupancy

      83.3 %      83.4 %      (0.1 )pts      71.2 %      71.9 %      (0.7 )pts 

ADR

    $ 215.82      $ 206.31        4.6 %    $ 186.80      $ 177.72        5.1 % 

RevPAR

    $ 179.72      $ 172.03        4.5 %    $ 133.05      $ 127.73        4.2 % 

Total RevPAR

    $ 300.69      $ 271.78        10.6 %    $ 229.64      $ 204.32        12.4 % 

INTERCONTINENTAL MIAMI

             

Selected Financial Information:

             

Total revenues

    $ 14,018      $ 11,466        22.3 %    $ 32,104      $ 28,327        13.3 % 

Property EBITDA

    $ 3,419      $ 2,169        57.6 %    $ 10,507      $ 8,570        22.6 % 

Selected Operating Information:

             

Rooms

      641        641        —          641        641        —     

Average occupancy

      79.0 %      70.1 %      8.9 pts      83.0 %      75.8 %      7.2 pts 

ADR

    $ 162.25      $ 150.45        7.8 %    $ 187.20      $ 182.60        2.5 % 

RevPAR

    $ 128.23      $ 105.40        21.7 %    $ 155.41      $ 138.35        12.3 % 

Total RevPAR

    $ 240.32      $ 196.56        22.3 %    $ 275.18      $ 244.15        12.7 % 

 

19

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2012     2011     Change     2012     2011     Change  

LOEWS SANTA MONICA BEACH HOTEL

             

Selected Financial Information:

             

Total revenues

    $ 12,535      $ 11,960        4.8 %    $ 24,716      $ 22,832        8.3 % 

Property EBITDA

    $ 3,603      $ 3,136        14.9 %    $ 6,498      $ 5,355        21.3 % 

Selected Operating Information:

             

Rooms

      342        342        —          342        342        —     

Average occupancy

      89.5 %      87.6 %      1.9 pts      87.7 %      86.9 %      0.8 pts 

ADR

    $ 312.19      $ 290.03        7.6 %    $ 302.73      $ 280.60        7.9 % 

RevPAR

    $ 279.26      $ 254.15        9.9 %    $ 265.63      $ 243.74        9.0 % 

Total RevPAR

    $ 402.78      $ 384.29        4.8 %    $ 397.08      $ 368.84        7.7 % 

MARRIOTT LINCOLNSHIRE RESORT

             

Selected Financial Information:

             

Total revenues

    $ 7,340      $ 7,234        1.5 %    $ 13,334      $ 12,530        6.4 % 

Property EBITDA

    $ 431      $ 574        (24.9 )%    $ (208 )    $ 110        (289.1 )% 

Selected Operating Information:

             

Rooms

      389        389        —          389        389        —     

Average occupancy

      64.2 %      51.8 %      12.4 pts      56.2 %      43.2 %      13.0 pts 

ADR

    $ 124.19      $ 124.50        (0.2 )%    $ 122.85      $ 124.72        (1.5 )% 

RevPAR

    $ 79.75      $ 64.49        23.7 %    $ 69.03      $ 53.92        28.0 % 

Total RevPAR

    $ 224.63      $ 221.37        1.5 %    $ 204.03      $ 191.73        6.4 % 

RITZ-CARLTON HALF MOON BAY

             

Selected Financial Information:

             

Total revenues

    $ 15,063      $ 14,402        4.6 %    $ 26,909      $ 25,416        5.9 % 

Property EBITDA

    $ 3,758      $ 2,693        39.5 %    $ 5,073      $ 3,408        48.9 % 

Selected Operating Information:

             

Rooms

      261        261        —          261        261        —     

Average occupancy

      67.9 %      68.6 %      (0.7 )pts      62.9 %      63.5 %      (0.6 )pts 

ADR

    $ 379.97      $ 352.12        7.9 %    $ 363.11      $ 329.85        10.1 % 

RevPAR

    $ 258.05      $ 241.39        6.9 %    $ 228.33      $ 209.29        9.1 % 

Total RevPAR

    $ 634.21      $ 606.37        4.6 %    $ 566.47      $ 538.00        5.3 % 

RITZ-CARLTON LAGUNA NIGUEL

             

Selected Financial Information:

             

Total revenues

    $ 19,789      $ 17,513        13.0 %    $ 35,591      $ 30,729        15.8 % 

Property EBITDA

    $ 6,725      $ 4,360        54.2 %    $ 10,371      $ 6,633        56.4 % 

Selected Operating Information:

             

Rooms

      396        396        —          396        396        —     

Average occupancy

      65.7 %      68.1 %      (2.4 )pts      62.4 %      60.9 %      1.5 pts 

ADR

    $ 356.50      $ 311.29        14.5 %    $ 351.28      $ 316.51        11.0 % 

RevPAR

    $ 234.11      $ 211.90        10.5 %    $ 219.04      $ 192.89        13.6 % 

Total RevPAR

    $ 549.14      $ 485.98        13.0 %    $ 493.82      $ 428.72        15.2 % 

WESTIN ST. FRANCIS

             

Selected Financial Information:

             

Total revenues

    $ 32,589      $ 31,928        2.1 %    $ 64,557      $ 60,839        6.1 % 

Property EBITDA

    $ 7,573      $ 8,363        (9.4 )%    $ 13,397      $ 12,939        3.5 % 

Selected Operating Information:

             

Rooms

      1,195        1,195        —          1,195        1,195        —     

Average occupancy

      83.1 %      84.4 %      (1.3 )pts      80.1 %      79.3 %      0.8 pts 

ADR

    $ 222.49      $ 204.47        8.8 %    $ 224.42      $ 203.43        10.3 % 

RevPAR

    $ 184.80      $ 172.60        7.1 %    $ 179.78      $ 161.40        11.4 % 

Total RevPAR

    $ 299.68      $ 293.60        2.1 %    $ 296.83      $ 281.28        5.5 % 

 

20

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

     Three Months Ended June 30,     Six Months Ended June 30,  
MEXICAN HOTEL:    2012     2011     Change     2012     2011     Change  

FOUR SEASONS PUNTA MITA RESORT

             

Selected Financial Information:

             

Total revenues

    $ 8,153      $ 8,594        (5.1 )%    $ 18,083      $ 19,155        (5.6 )% 

Property EBITDA

    $ 1,618      $ 1,992        (18.8 )%    $ 4,834      $ 5,512        (12.3 )% 

Selected Operating Information:

             

Rooms

      173        173        —          173        173        —     

Average occupancy

      48.6 %      46.0 %      2.6 pts      47.5 %      47.7 %      (0.2 )pts 

ADR

    $ 531.44      $ 593.05        (10.4 )%    $ 630.51      $ 666.63        (5.4 )% 

RevPAR

    $ 258.48      $ 272.51        (5.1 )%    $ 299.47      $ 318.04        (5.8 )% 

Total RevPAR

    $ 517.91      $ 545.89        (5.1 )%    $ 574.33      $ 611.71        (6.1 )% 

EUROPEAN HOTELS:

             

MARRIOTT HAMBURG

             

Selected Financial Information:

             

Total revenues

    $ 5,599      $ 6,625        (15.5 )%    $ 10,279      $ 11,433        (10.1 )% 

Property EBITDA

    $ 1,496      $ 1,844        (18.9 )%    $ 2,896      $ 3,300        (12.2 )% 

Selected Operating Information:

             

Rooms

      278        278        —          278        278        —     

Average occupancy

      85.2 %      86.7 %      (1.5 )pts      79.6 %      81.3 %      (1.7 )pts 

ADR

    $ 184.72      $ 220.23        (16.1 )%    $ 182.60      $ 200.70        (9.0 )% 

RevPAR

    $ 157.34      $ 190.94        (17.6 )%    $ 145.38      $ 163.22        (10.9 )% 

Total RevPAR

    $ 221.31      $ 261.90        (15.5 )%    $ 203.16      $ 227.22        (10.6 )% 

MARRIOTT LONDON GROSVENOR SQUARE

             

Selected Financial Information:

             

Total revenues

    $ 9,704      $ 9,742        (0.4 )%    $ 17,501      $ 16,447        6.4  % 

Property EBITDA

    $ 4,538      $ 4,282        6.0 %    $ 7,413      $ 6,558        13.0  % 

Selected Operating Information:

             

Rooms

      237        237        —          237        237        —     

Average occupancy

      85.9 %      84.8 %      1. 1pts      83.7 %      75.0 %      8.7 pts 

ADR

    $ 403.98      $ 406.97        (0.7 )%    $ 370.34      $ 376.21        (1.6 )% 

RevPAR

    $ 347.09      $ 345.04        0.6 %    $ 309.94      $ 282.17        9.8  % 

Total RevPAR

    $ 449.95      $ 451.69        (0.4 )%    $ 405.73      $ 383.41        5.8  % 

 

21

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012 and 2011

 

Reconciliation of Property EBITDA to EBITDA

(in thousands)

 

     Three Months Ended June 30,     Six Months Ended June 30,  
     2012     2011     2012     2011  

Hotel

    Property
EBITDA		     EBITDA     Property
EBITDA		     EBITDA     Property
EBITDA		     EBITDA     Property
EBITDA		      EBITDA  

Fairmont Chicago

    $ 4,978      $ 4,978      $ 4,240      $ 4,240      $ 4,632      $ 4,632      $ 3,033       $ 3,033   

Fairmont Scottsdale Princess (a)

      3,251        —          3,158        3,902        11,906        —          10,528         11,272   

Four Seasons Jackson Hole (b)

      (501 )      (501 )      (721 )      (721 )      2,273        2,273        —           13   

Four Seasons Silicon Valley (b)

      2,167        2,167        1,286        1,286        3,625        3,625        —           1,636   

Four Seasons Washington, D.C.

      5,195        5,195        4,808        4,808        7,083        7,083        6,835         6,835   

Hotel del Coronado (c)

      10,743        —          10,455        —          18,961        —          17,753         —     

Hyatt Regency La Jolla

      2,328        2,328        1,652        1,652        4,099        4,099        3,349         3,349   

InterContinental Chicago

      6,692        6,692        6,724        6,724        5,908        5,908        6,412         6,412   

InterContinental Miami

      3,419        3,419        2,169        2,169        10,507        10,507        8,570         8,570   

Loews Santa Monica Beach Hotel

      3,603        3,603        3,136        3,136        6,498        6,498        5,355         5,355   

Marriott Lincolnshire Resort

      431        431        574        574        (208 )      (208 )      110         110   

Ritz-Carlton Half Moon Bay

      3,758        3,758        2,693        2,693        5,073        5,073        3,408         3,408   

Ritz-Carlton Laguna Niguel

      6,725        6,725        4,360        4,360        10,371        10,371        6,633         6,633   

Westin St. Francis

      7,573        7,573        8,363        8,363        13,397        13,397        12,939         12,939   

Four Seasons Punta Mita Resort

      1,618        1,618        1,992        1,992        4,834        4,834        5,512         5,512   

Marriott Hamburg (d)

      1,496        22        1,844        20        2,896        19        3,300         39   

Marriott London Grosvenor Square

      4,538        4,538        4,282        4,282        7,413        7,413        6,558         6,558   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  
   $ 68,014      $ 52,546      $ 61,015      $ 49,480      $ 119,268      $ 85,524      $ 100,295       $ 81,674   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

     

 

 

  

Adjustments:

                  

Corporate expenses

        (2,866 )        (11,957 )        (16,676 )         (26,434 ) 

Interest income

        50          51          80           83   

Loss on early extinguishment of debt

        —            (838 )        —             (838 ) 

Loss on early termination of derivative financial instruments

   

     —            (29,242 )        —             (29,242 ) 

Equity in (losses) earnings of unconsolidated affiliates

        (717 )        (2,799 )        203           (4,399 ) 

Foreign currency exchange (loss) gain

        (168 )        147          (173 )         286   

Other income, net

        477          436          929           4,361   

(Loss) income from discontinued operations

        (535 )        101,034          (535 )         101,196   

Income taxes—discontinued operations

        —            20          —             379   

Noncontrolling interest in consolidated affiliates

        (379 )        (1,338 )        (350 )         (743 ) 

Adjustments from consolidated affiliates

        (1,246 )        (2,854 )        (2,503 )         (4,183 ) 

Adjustments from unconsolidated affiliates

        6,888          5,241          13,570           9,131   

Other adjustments

        (649 )        (577 )        (1,275 )         (866 ) 
    

 

 

      

 

 

      

 

 

       

 

 

  

EBITDA

      $ 53,401        $ 106,804        $ 78,794         $ 130,405   
    

 

 

      

 

 

      

 

 

       

 

 

  

 

(a) Prior to June 9, 2011, we owned 100% of the Fairmont Scottsdale Princess hotel. On June 9, 2011, we completed a recapitalization of the entity and our ownership interest decreased to 50%. We now account for this investment under the equity method of accounting. Therefore, EBITDA related to our interest in this property subsequent to June 9, 2011 is reflected in adjustments from unconsolidated affiliates for the three and six months ended June 30, 2012 and 2011. Property EBITDA represents 100% of revenue and expenses generated by the property.
(b) On March 11, 2011, we purchased the Four Seasons Jackson Hole and the Four Seasons Silicon Valley hotels. We have not included the results of these hotels in Property EBITDA for the six months ended June 30, 2011 above since we did not own the properties for the entire period.
(c) We account for this property under the equity method of accounting. Therefore, EBITDA related to our interest in this property is reflected in adjustments from unconsolidated affiliates for the three and six months ended June 30, 2012 and 2011. Property EBITDA represents 100% of revenue and expenses generated by the property.
(d) We have a leasehold interest in and sublease this property. Therefore, EBITDA represents the lease revenue less the lease expense recorded in our statements. Property EBITDA represents the revenue less expenses generated by the property.

 

22

   Supplemental Financial Information

Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)

    Three and Six Months Ended June 30, 2012

 

Reconciliation of Property EBITDA to Comparable EBITDA

(in thousands)

 

     Three Months Ended June 30, 2012     Six Months Ended June 30, 2012  
     Property           Comparable     Property           Comparable  
     EBITDA     Adjustments     EBITDA     EBITDA     Adjustments     EBITDA  

Urban Hotels:

             

Fairmont Chicago

    $ 4,978      $ —        $ 4,978      $ 4,632      $ —        $ 4,632   

Four Seasons Silicon Valley

      2,167        —          2,167        3,625        —          3,625   

Four Seasons Washington, D.C.

      5,195        —          5,195        7,083        —          7,083   

Hyatt Regency La Jolla

      2,328        (1,083 )      1,245        4,099        (1,906 )      2,193   

InterContinental Chicago

      6,692        —          6,692        5,908        —          5,908   

InterContinental Miami

      3,419        —          3,419        10,507        —          10,507   

Westin St. Francis

      7,573        —          7,573        13,397        —          13,397   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Urban Hotels

      32,352        (1,083 )      31,269        49,251        (1,906 )      47,345   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Resorts:

             

Fairmont Scottsdale Princess

      3,251        (1,606 )      1,645        11,906        (5,992 )      5,914   

Four Seasons Jackson Hole

      (501 )      —          (501 )      2,273        —          2,273   

Four Seasons Punta Mita Resort

      1,618        —          1,618        4,834        —          4,834   

Hotel del Coronado

      10,743        (7,078 )      3,665        18,961        (12,500 )      6,461   

Loews Santa Monica Beach Hotel

      3,603        —          3,603        6,498        —          6,498   

Marriott Lincolnshire Resort

      431        —          431        (208 )      —          (208 ) 

Ritz-Carlton Half Moon Bay

      3,758        —          3,758        5,073        —          5,073   

Ritz-Carlton Laguna Niguel

      6,725        —          6,725        10,371        —          10,371   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total Resorts

      29,628        (8,684 )      20,944        59,708        (18,492 )      41,216   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

European Hotels:

             

Marriott Hamburg

      1,496        (1,524 )      (28 )      2,896        (2,978 )      (82 ) 

Marriott London Grosvenor Square

      4,538        —          4,538        7,413        —          7,413   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

Total European Hotels

      6,034        (1,524 )      4,510        10,309        (2,978 )      7,331   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  
   $ 68,014      $ (11,291 )    $ 56,723      $ 119,268      $ (23,376 )    $ 95,892   
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

  

 

     % of QTR     % of YTD  
     Comparable EBITDA     Comparable EBITDA  

Urban Hotels

      55 %      49 % 

Resorts

      37 %      43 % 

European Hotels

      8 %      8 % 
  

 

 

    

 

 

  

Total

      100 %      100 % 
  

 

 

    

 

 

  

 

Total United States Urban Hotels (as of June 30, 2012)   
7 Properties             
4,156 Rooms             
     Three Months Ended
June 30,		     Six Months Ended
June 30,		  
     2012     2011     Change     2012     2011     Change  

ADR

    $ 233.09      $ 218.79        6.5 %    $ 224.82      $ 211.22        6.4 % 

Average Occupancy

      80.1 %      77.7 %      2.4 pts      74.9 %      72.7 %      2.2 pts 

RevPAR

    $ 186.79      $ 170.02        9.9 %    $ 168.50      $ 153.54        9.7 % 

Total RevPAR

    $ 325.69      $ 297.79        9.4 %    $ 297.40      $ 274.20        8.5 % 

Property EBITDA Margin

      26.3 %      26.0 %      0.3 pts      21.9 %      20.9 %      1.0 pts 
Total United States Resorts (as of June 30, 2012)   
7 Properties             
2,918 Rooms             
     Three Months Ended     Six Months Ended  
     June 30,     June 30,  
     2012     2011     Change     2012     2011     Change  

ADR

    $ 298.04      $ 280.53        6.2 %    $ 301.80      $ 287.73        4.9 % 

Average Occupancy

      67.9 %      67.0 %      0.9 pts      67.6 %      65.8 %      1.8 pts 

RevPAR

    $ 202.41      $ 188.03        7.6 %    $ 203.94      $ 189.29        7.7 % 

Total RevPAR

    $ 429.39      $ 411.03        4.5 %    $ 434.30      $ 408.79        6.2 % 

Property EBITDA Margin

      24.8 %      21.9 %      2.9 pts      24.0 %      21.2 %      2.8 pts 

 

23

   Supplemental Financial Information
Strategic Hotels & Resorts, Inc. and Subsidiaries (SHR)    June 30, 2012

 

2012 Guidance

(in millions, except per share data)

 

     Year Ended
December 31, 2012 		 

Operational Guidance

   Low Range     High Range  

North American same store Total RevPAR growth (a)

     5.0 %      7.0 % 

North American same store RevPAR growth (a)

     6.0 %      8.0 % 

 

(a) Includes North American hotels which are consolidated in our financial results, but excludes the Four Seasons Jackson Hole and Four Seasons Silicon Valley hotels, which were acquired in 2011.

 

     Year Ended
December 31, 2012 		 

Comparable EBITDA Guidance

   Low Range     High Range  

Net loss attributable to common shareholders

   $ (81.4 )    $ (66.4 ) 

Depreciation and amortization

      112.0        112.0   

Interest expense

      82.6        82.6   

Income taxes

      0.9        0.9   

Noncontrolling interests

      (0.3 )      (0.3 ) 

Adjustments from consolidated affiliates

      (5.8 )      (5.8 ) 

Adjustments from unconsolidated affiliates

      28.0        28.0   

Preferred shareholder dividends

      24.2        24.2   

Realized portion of deferred gain on sale-leasebacks

      (0.2 )      (0.2 ) 

Adjustment for Value Creation Plan

      4.8        4.8   

Other adjustments

      0.2        0.2   
  

 

 

    

 

 

  

Comparable EBITDA

    $ 165.0      $ 180.0   
  

 

 

    

 

 

  

 

     Year Ended
December 31, 2012 		 

Comparable FFO Guidance

   Low Range     High Range  
    

Net loss attributable to common shareholders

   $ (81.4 )    $ (66.4 ) 

Depreciation and amortization

      110.8        110.8   

Realized portion of deferred gain on sale-leasebacks

      (0.2 )      (0.2 ) 

Noncontrolling interests

      (0.3 )      (0.2 ) 

Adjustments from consolidated affiliates

      (2.8 )      (2.8 ) 

Adjustments from unconsolidated affiliates

      15.4        15.4   

Adjustment for Value Creation Plan

     4.8        4.8   

Other adjustments

     (2.5 )      (2.5 ) 
  

 

 

    

 

 

  

Comparable FFO

    $ 43.8      $ 58.9   
  

 

 

    

 

 

  

Comparable FFO per diluted share

    $ 0.21      $ 0.29   
  

 

 

    

 

 

  

 

24

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STRATEGIC HOTELS & RESORTS, INC Reports