(Mark One) | ||
x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF | |
THE SECURITIES EXCHANGE ACT OF 1934 | ||
For the quarterly period ended September 30, 2015 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF | |
THE SECURITIES EXCHANGE ACT OF 1934 | ||
For the transition period from to |
Commission file number: 001-14236 | (FelCor Lodging Trust Incorporated) | ||
Commission file number: 333-39595-01 | (FelCor Lodging Limited Partnership) |
Maryland | (FelCor Lodging Trust Incorporated) | 75-2541756 | |||
Delaware | (FelCor Lodging Limited Partnership) | 75-2544994 | |||
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) | ||||
545 E. John Carpenter Freeway, Suite 1300, Irving, Texas | 75062 | |||
(Address of Principal Executive Offices) | (Zip Code) |
FelCor Lodging Trust Incorporated | þ | Yes | ¨ | No | ||
FelCor Lodging Limited Partnership | (see Note) | ¨ | Yes | þ | No |
FelCor Lodging Trust Incorporated | þ | Yes | ¨ | No | ||
FelCor Lodging Limited Partnership | þ | Yes | ¨ | No |
FelCor Lodging Trust Incorporated: | ||
Large accelerated filer þ | Accelerated filer o | |
Non-accelerated filer o (Do not check if a smaller reporting company) | Smaller reporting company o |
FelCor Lodging Limited Partnership: | ||
Large accelerated filer o | Accelerated filer ¨ | |
Non-accelerated filer þ (Do not check if a smaller reporting company) | Smaller reporting company o |
FelCor Lodging Trust Incorporated | ¨ | Yes | þ | No | ||
FelCor Lodging Limited Partnership | ¨ | Yes | þ | No |
• | presents our business as a whole (the same way management views and operates the business); |
• | eliminates duplicative disclosure and provides a more streamlined presentation (a substantial portion of our disclosure applies to both FelCor and FelCor LP); and |
• | saves time and cost by preparing combined reports instead of separate reports. |
Page | ||||
PART I – FINANCIAL INFORMATION | ||||
Item 1. | Financial Statements | |||
FelCor Lodging Trust Incorporated: | ||||
Consolidated Balance Sheets - September 30, 2015 and December 31, 2014 (unaudited) | ||||
Consolidated Statements of Operations – For the Three and Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
Consolidated Statements of Comprehensive Income (Loss) – For the Three and Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
Consolidated Statements of Changes in Equity – For the Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
Consolidated Statements of Cash Flows – For the Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
FelCor Lodging Limited Partnership: | ||||
Consolidated Balance Sheets - September 30, 2015 and December 31, 2014 (unaudited) | ||||
Consolidated Statements of Operations – For the Three and Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
Consolidated Statements of Comprehensive Income (Loss) – For the Three and Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
Consolidated Statements of Partners’ Capital – For the Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
Consolidated Statements of Cash Flows – For the Nine Months Ended September 30, 2015 and 2014 (unaudited) | ||||
Notes to Consolidated Financial Statements | ||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |||
General | ||||
Results of Operations | ||||
Non-GAAP Financial Measures | ||||
Pro Rata Share of Rooms Owned | ||||
Hotel Portfolio Composition | ||||
Hotel Operating Statistics | ||||
Hotel Portfolio | ||||
Liquidity and Capital Resources | ||||
Inflation and Competition | ||||
Seasonality | 58 | |||
Disclosure Regarding Forward-Looking Statements | ||||
Item 3. | Quantitative and Qualitative Disclosures about Market Risk | |||
Item 4. | Controls and Procedures | |||
PART II – OTHER INFORMATION | ||||
Item 6. | Exhibits | |||
SIGNATURES |
Item 1. | Financial Statements. |
September 30, 2015 | December 31, 2014 | ||||||
Assets | |||||||
Investment in hotels, net of accumulated depreciation of $880,002 and $850,687 at September 30, 2015 and December 31, 2014, respectively | $ | 1,694,066 | $ | 1,599,791 | |||
Hotel development | 48,655 | 297,466 | |||||
Investment in unconsolidated entities | 10,938 | 15,095 | |||||
Hotels held for sale | — | 47,145 | |||||
Cash and cash equivalents | 56,911 | 47,147 | |||||
Restricted cash | 24,701 | 20,496 | |||||
Accounts receivable, net of allowance for doubtful accounts of $230 and $241 at September 30, 2015 and December 31, 2014, respectively | 37,085 | 27,805 | |||||
Deferred expenses, net of accumulated amortization of $6,864 and $17,111 at September 30, 2015 and December 31, 2014, respectively | 25,240 | 25,827 | |||||
Other assets | 16,574 | 23,886 | |||||
Total assets | $ | 1,914,170 | $ | 2,104,658 | |||
Liabilities and Equity | |||||||
Debt | $ | 1,418,632 | $ | 1,585,867 | |||
Distributions payable | 12,450 | 13,827 | |||||
Accrued expenses and other liabilities | 132,321 | 135,481 | |||||
Total liabilities | 1,563,403 | 1,735,175 | |||||
Commitments and contingencies | |||||||
Redeemable noncontrolling interests in FelCor LP, 611 units issued and outstanding at September 30, 2015 and December 31, 2014 | 4,323 | 6,616 | |||||
Equity: | |||||||
Preferred stock, $0.01 par value, 20,000 shares authorized: | |||||||
Series A Cumulative Convertible Preferred Stock, 12,879 shares, liquidation value of $321,987, issued and outstanding at September 30, 2015 and December 31, 2014 | 309,337 | 309,337 | |||||
Series C Cumulative Redeemable Preferred Stock, 68 shares, liquidation value of $169,950, issued and outstanding at December 31, 2014 | — | 169,412 | |||||
Common stock, $0.01 par value, 200,000 shares authorized; 143,382 and 124,605 shares issued and outstanding at September 30, 2015 and December 31, 2014, respectively | 1,434 | 1,246 | |||||
Additional paid-in capital | 2,566,123 | 2,353,666 | |||||
Accumulated deficit | (2,582,726 | ) | (2,530,671 | ) | |||
Total FelCor stockholders’ equity | 294,168 | 302,990 | |||||
Noncontrolling interests in other partnerships | 9,090 | 18,435 | |||||
Preferred equity in consolidated joint venture, liquidation value of $43,926 and $42,094 at September 30, 2015 and December 31, 2014, respectively | 43,186 | 41,442 | |||||
Total equity | 346,444 | 362,867 | |||||
Total liabilities and equity | $ | 1,914,170 | $ | 2,104,658 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Revenues: | |||||||||||||||
Hotel operating revenue | $ | 223,474 | $ | 232,449 | $ | 672,808 | $ | 711,750 | |||||||
Other revenue | 1,678 | 1,607 | 7,142 | 3,170 | |||||||||||
Total revenues | 225,152 | 234,056 | 679,950 | 714,920 | |||||||||||
Expenses: | |||||||||||||||
Hotel departmental expenses | 78,514 | 82,731 | 236,202 | 255,882 | |||||||||||
Other property-related costs | 55,893 | 59,441 | 170,579 | 183,931 | |||||||||||
Management and franchise fees | 9,138 | 9,632 | 27,425 | 28,805 | |||||||||||
Taxes, insurance and lease expense | 12,716 | 19,053 | 43,933 | 69,276 | |||||||||||
Corporate expenses | 4,672 | 6,442 | 19,775 | 21,914 | |||||||||||
Depreciation and amortization | 28,988 | 28,523 | 85,510 | 87,206 | |||||||||||
Impairment loss | 20,861 | — | 20,861 | — | |||||||||||
Other expenses | 5,807 | 9,746 | 11,446 | 13,874 | |||||||||||
Total operating expenses | 216,589 | 215,568 | 615,731 | 660,888 | |||||||||||
Operating income | 8,563 | 18,488 | 64,219 | 54,032 | |||||||||||
Interest expense, net | (19,602 | ) | (21,922 | ) | (59,361 | ) | (71,644 | ) | |||||||
Debt extinguishment | (13 | ) | (4,730 | ) | (30,909 | ) | (4,763 | ) | |||||||
Gain on sale of investment in unconsolidated entities, net | — | 30,184 | — | 30,184 | |||||||||||
Gain from remeasurement of unconsolidated entities, net | — | 20,733 | — | 20,733 | |||||||||||
Other gains, net | — | — | 166 | 100 | |||||||||||
Income (loss) before equity in income from unconsolidated entities | (11,052 | ) | 42,753 | (25,885 | ) | 28,642 | |||||||||
Equity in income from unconsolidated entities | 321 | 1,347 | 7,983 | 4,756 | |||||||||||
Income (loss) from continuing operations before income tax expense | (10,731 | ) | 44,100 | (17,902 | ) | 33,398 | |||||||||
Income tax expense | (1,054 | ) | (78 | ) | (1,392 | ) | (480 | ) | |||||||
Income (loss) from continuing operations | (11,785 | ) | 44,022 | (19,294 | ) | 32,918 | |||||||||
Income (loss) from discontinued operations | 498 | (8 | ) | 419 | 132 | ||||||||||
Income (loss) before gain on sale of hotels | (11,287 | ) | 44,014 | (18,875 | ) | 33,050 | |||||||||
Gain on sale of hotels, net | 3,154 | 29,556 | 19,491 | 50,639 | |||||||||||
Net income (loss) | (8,133 | ) | 73,570 | 616 | 83,689 | ||||||||||
Net loss (income) attributable to noncontrolling interests in other partnerships | 227 | (646 | ) | (4,405 | ) | (830 | ) | ||||||||
Net loss (income) attributable to redeemable noncontrolling interests in FelCor LP | 61 | (185 | ) | 150 | (135 | ) | |||||||||
Preferred distributions - consolidated joint venture | (363 | ) | (348 | ) | (1,070 | ) | (870 | ) | |||||||
Net income (loss) attributable to FelCor | (8,208 | ) | 72,391 | (4,709 | ) | 81,854 | |||||||||
Preferred dividends | (6,279 | ) | (9,678 | ) | (23,860 | ) | (29,034 | ) | |||||||
Redemption of preferred stock | — | — | (6,096 | ) | — | ||||||||||
Net income (loss) attributable to FelCor common stockholders | $ | (14,487 | ) | $ | 62,713 | $ | (34,665 | ) | $ | 52,820 | |||||
Basic per common share data: | |||||||||||||||
Income (loss) from continuing operations | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Net income (loss) | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.43 | |||||
Basic weighted average common shares outstanding | 142,982 | 124,168 | 136,009 | 124,159 | |||||||||||
Diluted per common share data: | |||||||||||||||
Income (loss) from continuing operations | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Net income (loss) | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Diluted weighted average common shares outstanding | 142,982 | 125,526 | 136,009 | 125,289 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net income (loss) | $ | (8,133 | ) | $ | 73,570 | $ | 616 | $ | 83,689 | ||||||
Foreign currency translation adjustment | — | (445 | ) | — | (490 | ) | |||||||||
Reclassification of foreign currency translation to gain | — | (24,448 | ) | — | (24,448 | ) | |||||||||
Comprehensive income (loss) | (8,133 | ) | 48,677 | 616 | 58,751 | ||||||||||
Comprehensive loss (income) attributable to noncontrolling interests in other partnerships | 227 | (646 | ) | (4,405 | ) | (830 | ) | ||||||||
Comprehensive loss (income) attributable to redeemable noncontrolling interests in FelCor LP | 61 | (184 | ) | 150 | (134 | ) | |||||||||
Preferred distributions - consolidated joint venture | (363 | ) | (348 | ) | (1,070 | ) | (870 | ) | |||||||
Comprehensive income (loss) attributable to FelCor | $ | (8,208 | ) | $ | 47,499 | $ | (4,709 | ) | $ | 56,917 |
Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Accumulated Deficit | Noncontrolling Interests in Other Partnerships | Preferred Equity in Consolidated Joint Venture | Comprehensive Income (Loss) | Total Equity | |||||||||||||||||||||||||||||||||
Number of Shares | Amount | Number of Shares | Amount | ||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2013 | 12,948 | $ | 478,774 | 124,051 | $ | 1,240 | $ | 2,354,328 | $ | 24,937 | $ | (2,568,350 | ) | $ | 23,301 | $ | — | $ | 314,230 | ||||||||||||||||||||||
Conversion of preferred stock into common stock | — | (8 | ) | — | — | 8 | — | — | — | — | — | ||||||||||||||||||||||||||||||
Issuance of stock awards | — | — | 349 | 4 | (4 | ) | — | — | — | — | — | ||||||||||||||||||||||||||||||
Stock awards - amortization | — | — | — | — | 3,066 | — | — | — | — | 3,066 | |||||||||||||||||||||||||||||||
Forfeiture of stock awards | — | — | (117 | ) | (1 | ) | — | — | (931 | ) | — | — | (932 | ) | |||||||||||||||||||||||||||
Conversion of operating partnership units into common shares | — | — | 6 | — | 56 | — | — | — | — | 56 | |||||||||||||||||||||||||||||||
Allocation to redeemable noncontrolling interests | — | — | — | — | (642 | ) | — | — | — | — | (642 | ) | |||||||||||||||||||||||||||||
Contribution from noncontrolling interests | — | — | — | — | — | — | — | 5,508 | — | 5,508 | |||||||||||||||||||||||||||||||
Distribution to noncontrolling interests | — | — | — | — | — | — | — | (8,634 | ) | — | (8,634 | ) | |||||||||||||||||||||||||||||
Acquisition of noncontrolling interest | — | — | — | — | (3,508 | ) | — | — | (2,342 | ) | — | (5,850 | ) | ||||||||||||||||||||||||||||
Dividends declared: | |||||||||||||||||||||||||||||||||||||||||
$0.06 per common share | — | — | — | — | — | — | (7,556 | ) | — | — | (7,556 | ) | |||||||||||||||||||||||||||||
$1.4625 per Series A preferred share | — | — | — | — | — | — | (18,837 | ) | — | — | (18,837 | ) | |||||||||||||||||||||||||||||
$1.50 per Series C depositary preferred share | — | — | — | — | — | — | (10,197 | ) | — | — | (10,197 | ) | |||||||||||||||||||||||||||||
Preferred distributions - consolidated joint venture | — | — | — | — | — | — | — | — | (870 | ) | (870 | ) | |||||||||||||||||||||||||||||
Issuance of preferred equity - consolidated joint venture | — | — | — | — | — | — | — | — | 41,443 | 41,443 | |||||||||||||||||||||||||||||||
Comprehensive income (attributable to FelCor and noncontrolling interests in other partnerships): | |||||||||||||||||||||||||||||||||||||||||
Foreign exchange translation | — | — | — | — | — | (489 | ) | — | — | — | $ | (489 | ) | ||||||||||||||||||||||||||||
Reclassification of foreign currency translation to gain | — | — | — | — | — | (24,448 | ) | — | — | — | (24,448 | ) | |||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | 81,854 | 830 | 870 | 83,554 | |||||||||||||||||||||||||||||||
Comprehensive income | $ | 58,617 | 58,617 | ||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2014 | 12,948 | $ | 478,766 | 124,289 | $ | 1,243 | $ | 2,353,304 | $ | — | $ | (2,524,017 | ) | $ | 18,663 | $ | 41,443 | $ | 369,402 | ||||||||||||||||||||||
Balance at December 31, 2014 | 12,947 | $ | 478,749 | 124,605 | $ | 1,246 | $ | 2,353,666 | $ | — | $ | (2,530,671 | ) | $ | 18,435 | $ | 41,442 | $ | 362,867 | ||||||||||||||||||||||
Issuance of common stock | — | — | 18,400 | 184 | 198,467 | — | — | — | — | 198,651 | |||||||||||||||||||||||||||||||
Issuance of stock awards | — | — | 379 | 4 | 690 | — | — | — | — | 694 | |||||||||||||||||||||||||||||||
Stock awards - amortization and severance | — | — | — | — | 5,702 | — | — | — | — | 5,702 | |||||||||||||||||||||||||||||||
Redemption of Series C preferred stock | (68 | ) | (169,412 | ) | — | — | 5,522 | — | (6,096 | ) | — | — | (169,986 | ) | |||||||||||||||||||||||||||
Forfeiture of stock awards | — | — | (2 | ) | — | — | — | (8 | ) | — | — | (8 | ) | ||||||||||||||||||||||||||||
Allocation to redeemable noncontrolling interests | — | — | — | — | 2,076 | — | — | — | — | 2,076 | |||||||||||||||||||||||||||||||
Contribution from noncontrolling interests | — | — | — | — | — | — | — | 2,544 | — | 2,544 | |||||||||||||||||||||||||||||||
Distribution to noncontrolling interests | — | — | — | — | — | — | — | (16,294 | ) | — | (16,294 | ) | |||||||||||||||||||||||||||||
Dividends declared: | |||||||||||||||||||||||||||||||||||||||||
$0.12 per common share | — | — | — | — | — | — | (17,382 | ) | — | — | (17,382 | ) | |||||||||||||||||||||||||||||
$1.4625 per Series A preferred share | — | — | — | — | — | — | (18,837 | ) | — | — | (18,837 | ) | |||||||||||||||||||||||||||||
$1.00 per Series C depositary preferred share | — | — | — | — | — | — | (5,023 | ) | — | — | (5,023 | ) | |||||||||||||||||||||||||||||
Preferred distributions - consolidated joint venture | — | — | — | — | — | — | — | — | (1,070 | ) | (1,070 | ) | |||||||||||||||||||||||||||||
Issuance of preferred equity - consolidated joint venture | — | — | — | — | — | — | — | — | 1,744 | 1,744 | |||||||||||||||||||||||||||||||
Comprehensive income (attributable to FelCor and noncontrolling interests in other partnerships): | |||||||||||||||||||||||||||||||||||||||||
Net income (loss) | — | — | — | — | — | — | (4,709 | ) | 4,405 | 1,070 | $ | 766 | |||||||||||||||||||||||||||||
Comprehensive income | $ | 766 | 766 | ||||||||||||||||||||||||||||||||||||||
Balance at September 30, 2015 | 12,879 | $ | 309,337 | 143,382 | $ | 1,434 | $ | 2,566,123 | $ | — | $ | (2,582,726 | ) | $ | 9,090 | $ | 43,186 | $ | 346,444 |
Nine Months Ended September 30, | |||||||
2015 | 2014 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 616 | $ | 83,689 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 85,510 | 87,206 | |||||
Gain on sale of hotels and other assets, net | (20,065 | ) | (51,129 | ) | |||
Gain on sale of investment in unconsolidated entities, net | — | (30,184 | ) | ||||
Gain from remeasurement of unconsolidated entities, net | — | (20,733 | ) | ||||
Amortization of deferred financing fees and debt discount | 4,085 | 8,136 | |||||
Amortization of fixed stock and directors’ compensation | 5,214 | 4,490 | |||||
Equity based severance | 1,352 | — | |||||
Equity in income from unconsolidated entities | (7,983 | ) | (4,756 | ) | |||
Distributions of income from unconsolidated entities | 5,680 | 3,394 | |||||
Debt extinguishment | 30,909 | 5,008 | |||||
Impairment loss | 20,861 | — | |||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (9,696 | ) | 271 | ||||
Other assets | 1,529 | (4,834 | ) | ||||
Accrued expenses and other liabilities | (3,958 | ) | 7,107 | ||||
Net cash flow provided by operating activities | 114,054 | 87,665 | |||||
Cash flows from investing activities: | |||||||
Improvements and additions to hotels | (35,979 | ) | (65,547 | ) | |||
Hotel development | (31,599 | ) | (63,381 | ) | |||
Net proceeds from asset sales | 190,035 | 119,991 | |||||
Proceeds from unconsolidated joint venture transaction | — | 4,032 | |||||
Change in restricted cash – investing | (4,204 | ) | 42,964 | ||||
Insurance proceeds | 274 | 255 | |||||
Distributions from unconsolidated entities in excess of earnings | 6,460 | 10,658 | |||||
Net cash flow provided by investing activities | 124,987 | 48,972 | |||||
Cash flows from financing activities: | |||||||
Proceeds from borrowings | 979,000 | 439,607 | |||||
Repayment of borrowings | (1,166,693 | ) | (553,867 | ) | |||
Payment of deferred financing fees | (14,348 | ) | (3,052 | ) | |||
Acquisition of noncontrolling interest | — | (5,850 | ) | ||||
Distributions paid to noncontrolling interests | (16,294 | ) | (8,634 | ) | |||
Contributions from noncontrolling interests | 2,544 | 5,508 | |||||
Distributions paid to FelCor LP limited partners | (68 | ) | (31 | ) | |||
Distributions paid to preferred stockholders | (26,125 | ) | (29,034 | ) | |||
Redemption of preferred stock | (169,986 | ) | — | ||||
Preferred distributions - consolidated joint venture | (1,070 | ) | (757 | ) | |||
Distributions paid to common stockholders | (16,498 | ) | (7,453 | ) | |||
Net proceeds from issuance of preferred equity - consolidated joint venture | 1,744 | 41,443 | |||||
Net proceeds from common stock issuance | 198,651 | — | |||||
Net cash flow used in financing activities | (229,143 | ) | (122,120 | ) | |||
Effect of exchange rate changes on cash | (134 | ) | (52 | ) | |||
Net change in cash and cash equivalents | 9,764 | 14,465 | |||||
Cash and cash equivalents at beginning of periods | 47,147 | 45,645 | |||||
Cash and cash equivalents at end of periods | $ | 56,911 | $ | 60,110 | |||
Supplemental cash flow information – interest paid, net of capitalized interest | $ | 55,215 | $ | 67,187 |
September 30, | December 31, | ||||||
2015 | 2014 | ||||||
Assets | |||||||
Investment in hotels, net of accumulated depreciation of $880,002 and $850,687 at September 30, 2015 and December 31, 2014, respectively | $ | 1,694,066 | $ | 1,599,791 | |||
Hotel development | 48,655 | 297,466 | |||||
Investment in unconsolidated entities | 10,938 | 15,095 | |||||
Hotels held for sale | — | 47,145 | |||||
Cash and cash equivalents | 56,911 | 47,147 | |||||
Restricted cash | 24,701 | 20,496 | |||||
Accounts receivable, net of allowance for doubtful accounts of $230 and $241 at September 30, 2015 and December 31, 2014, respectively | 37,085 | 27,805 | |||||
Deferred expenses, net of accumulated amortization of $6,864 and $17,111 at September 30, 2015 and December 31, 2014, respectively | 25,240 | 25,827 | |||||
Other assets | 16,574 | 23,886 | |||||
Total assets | $ | 1,914,170 | $ | 2,104,658 | |||
Liabilities and Partners’ Capital | |||||||
Debt | $ | 1,418,632 | $ | 1,585,867 | |||
Distributions payable | 12,450 | 13,827 | |||||
Accrued expenses and other liabilities | 132,321 | 135,481 | |||||
Total liabilities | 1,563,403 | 1,735,175 | |||||
Commitments and contingencies | |||||||
Redeemable units, 611 units issued and outstanding at September 30, 2015 and December 31, 2014 | 4,323 | 6,616 | |||||
Capital: | |||||||
Preferred units: | |||||||
Series A Cumulative Convertible Preferred Units, 12,879 units issued and outstanding at September 30, 2015 and December 31, 2014 | 309,337 | 309,337 | |||||
Series C Cumulative Redeemable Preferred Units, 68 units issued and outstanding at December 31, 2014 | — | 169,412 | |||||
Common units, 143,382 and 124,605 units issued and outstanding at September 30, 2015 and December 31, 2014, respectively | (15,169 | ) | (175,759 | ) | |||
Total FelCor LP partners’ capital | 294,168 | 302,990 | |||||
Noncontrolling interests | 9,090 | 18,435 | |||||
Preferred capital in consolidated joint venture | 43,186 | 41,442 | |||||
Total partners’ capital | 346,444 | 362,867 | |||||
Total liabilities and partners’ capital | $ | 1,914,170 | $ | 2,104,658 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Revenues: | |||||||||||||||
Hotel operating revenue | $ | 223,474 | $ | 232,449 | $ | 672,808 | $ | 711,750 | |||||||
Other revenue | 1,678 | 1,607 | 7,142 | 3,170 | |||||||||||
Total revenues | 225,152 | 234,056 | 679,950 | 714,920 | |||||||||||
Expenses: | |||||||||||||||
Hotel departmental expenses | 78,514 | 82,731 | 236,202 | 255,882 | |||||||||||
Other property-related costs | 55,893 | 59,441 | 170,579 | 183,931 | |||||||||||
Management and franchise fees | 9,138 | 9,632 | 27,425 | 28,805 | |||||||||||
Taxes, insurance and lease expense | 12,716 | 19,053 | 43,933 | 69,276 | |||||||||||
Corporate expenses | 4,672 | 6,442 | 19,775 | 21,914 | |||||||||||
Depreciation and amortization | 28,988 | 28,523 | 85,510 | 87,206 | |||||||||||
Impairment loss | 20,861 | — | 20,861 | — | |||||||||||
Other expenses | 5,807 | 9,746 | 11,446 | 13,874 | |||||||||||
Total operating expenses | 216,589 | 215,568 | 615,731 | 660,888 | |||||||||||
Operating income | 8,563 | 18,488 | 64,219 | 54,032 | |||||||||||
Interest expense, net | (19,602 | ) | (21,922 | ) | (59,361 | ) | (71,644 | ) | |||||||
Debt extinguishment | (13 | ) | (4,730 | ) | (30,909 | ) | (4,763 | ) | |||||||
Gain on sale of investment in unconsolidated entities, net | — | 30,184 | — | 30,184 | |||||||||||
Gain from remeasurement of unconsolidated entities, net | — | 20,733 | — | 20,733 | |||||||||||
Other gains, net | — | — | 166 | 100 | |||||||||||
Income (loss) before equity in income from unconsolidated entities | (11,052 | ) | 42,753 | (25,885 | ) | 28,642 | |||||||||
Equity in income from unconsolidated entities | 321 | 1,347 | 7,983 | 4,756 | |||||||||||
Income (loss) from continuing operations before income tax expense | (10,731 | ) | 44,100 | (17,902 | ) | 33,398 | |||||||||
Income tax expense | (1,054 | ) | (78 | ) | (1,392 | ) | (480 | ) | |||||||
Income (loss) from continuing operations | (11,785 | ) | 44,022 | (19,294 | ) | 32,918 | |||||||||
Income (loss) from discontinued operations | 498 | (8 | ) | 419 | 132 | ||||||||||
Income (loss) before gain on sale of hotels | (11,287 | ) | 44,014 | (18,875 | ) | 33,050 | |||||||||
Gain on sale of hotels, net | 3,154 | 29,556 | 19,491 | 50,639 | |||||||||||
Net income (loss) | (8,133 | ) | 73,570 | 616 | 83,689 | ||||||||||
Net loss (income) attributable to noncontrolling interests | 227 | (646 | ) | (4,405 | ) | (830 | ) | ||||||||
Preferred distributions - consolidated joint venture | (363 | ) | (348 | ) | (1,070 | ) | (870 | ) | |||||||
Net income (loss) attributable to FelCor LP | (8,269 | ) | 72,576 | (4,859 | ) | 81,989 | |||||||||
Preferred distributions | (6,279 | ) | (9,678 | ) | (23,860 | ) | (29,034 | ) | |||||||
Redemption of preferred units | — | — | (6,096 | ) | — | ||||||||||
Net income (loss) attributable to FelCor LP common unitholders | $ | (14,548 | ) | $ | 62,898 | $ | (34,815 | ) | $ | 52,955 | |||||
Basic and diluted per common unit data: | |||||||||||||||
Income (loss) from continuing operations | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Net income (loss) | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Basic weighted average common units outstanding | 143,594 | 124,781 | 136,621 | 124,774 | |||||||||||
Diluted weighted average common units outstanding | 143,594 | 126,164 | 136,621 | 125,916 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net income (loss) | $ | (8,133 | ) | $ | 73,570 | $ | 616 | $ | 83,689 | ||||||
Foreign currency translation adjustment | — | (445 | ) | — | (490 | ) | |||||||||
Reclassification of foreign currency translation to gain | — | (24,553 | ) | — | (24,553 | ) | |||||||||
Comprehensive income (loss) | (8,133 | ) | 48,572 | 616 | 58,646 | ||||||||||
Comprehensive loss (income) attributable to noncontrolling interests | 227 | (646 | ) | (4,405 | ) | (830 | ) | ||||||||
Preferred distributions - consolidated joint venture | (363 | ) | (348 | ) | (1,070 | ) | (870 | ) | |||||||
Comprehensive income (loss) attributable to FelCor LP | $ | (8,269 | ) | $ | 47,578 | $ | (4,859 | ) | $ | 56,946 |
Preferred Units | Common Units | Accumulated Other Comprehensive Income | Noncontrolling Interests | Preferred Capital in Consolidated Joint Venture | Comprehensive Income | Total Partners’ Capital | |||||||||||||||||||||
Balance at December 31, 2013 | $ | 478,774 | $ | (212,888 | ) | $ | 25,043 | $ | 23,301 | $ | — | $ | 314,230 | ||||||||||||||
Conversion of preferred units into common units | (8 | ) | 8 | — | — | — | — | ||||||||||||||||||||
FelCor restricted stock compensation | — | 2,134 | — | — | — | 2,134 | |||||||||||||||||||||
Contributions | — | — | — | 5,508 | — | 5,508 | |||||||||||||||||||||
Distributions | — | (36,590 | ) | — | (8,634 | ) | (870 | ) | (46,094 | ) | |||||||||||||||||
Allocation to redeemable units | — | (615 | ) | — | — | — | (615 | ) | |||||||||||||||||||
Acquisition of noncontrolling interests | — | (3,508 | ) | — | (2,342 | ) | — | (5,850 | ) | ||||||||||||||||||
Issuance of preferred capital - consolidated joint venture | — | — | — | — | 41,443 | 41,443 | |||||||||||||||||||||
Comprehensive income: | |||||||||||||||||||||||||||
Foreign exchange translation | — | — | (490 | ) | — | — | $ | (490 | ) | ||||||||||||||||||
Reclassification of foreign currency translation to gain | — | — | (24,553 | ) | — | — | (24,553 | ) | |||||||||||||||||||
Net income | — | 81,989 | — | 830 | 870 | 83,689 | |||||||||||||||||||||
Comprehensive income | — | — | — | — | — | $ | 58,646 | 58,646 | |||||||||||||||||||
Balance at September 30, 2014 | $ | 478,766 | $ | (169,470 | ) | $ | — | $ | 18,663 | $ | 41,443 | $ | 369,402 | ||||||||||||||
Balance at December 31, 2014 | $ | 478,749 | $ | (175,759 | ) | $ | — | $ | 18,435 | $ | 41,442 | $ | 362,867 | ||||||||||||||
Issuance of common units | — | 198,651 | — | — | — | 198,651 | |||||||||||||||||||||
FelCor restricted stock compensation | — | 6,388 | — | — | — | 6,388 | |||||||||||||||||||||
Redemption of Series C preferred units | (169,412 | ) | (574 | ) | — | — | — | (169,986 | ) | ||||||||||||||||||
Contributions | — | — | — | 2,544 | — | 2,544 | |||||||||||||||||||||
Distributions | — | (41,309 | ) | — | (16,294 | ) | (1,070 | ) | (58,673 | ) | |||||||||||||||||
Allocation to redeemable units | — | 2,293 | — | — | — | 2,293 | |||||||||||||||||||||
Issuance of preferred capital - consolidated joint venture | — | — | — | — | 1,744 | 1,744 | |||||||||||||||||||||
Comprehensive income: | |||||||||||||||||||||||||||
Net income (loss) | — | (4,859 | ) | — | 4,405 | 1,070 | $ | 616 | |||||||||||||||||||
Comprehensive income | — | — | — | — | — | $ | 616 | 616 | |||||||||||||||||||
Balance at September 30, 2015 | $ | 309,337 | $ | (15,169 | ) | $ | — | $ | 9,090 | $ | 43,186 | $ | 346,444 |
Nine Months Ended September 30, | |||||||
2015 | 2014 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 616 | $ | 83,689 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 85,510 | 87,206 | |||||
Gain on sale of hotels and other assets, net | (20,065 | ) | (51,129 | ) | |||
Gain on sale of investment in unconsolidated entities, net | — | (30,184 | ) | ||||
Gain from remeasurement of unconsolidated entities, net | — | (20,733 | ) | ||||
Amortization of deferred financing fees and debt discount | 4,085 | 8,136 | |||||
Amortization of fixed stock and directors’ compensation | 5,214 | 4,490 | |||||
Equity based severance | 1,352 | — | |||||
Equity in income from unconsolidated entities | (7,983 | ) | (4,756 | ) | |||
Distributions of income from unconsolidated entities | 5,680 | 3,394 | |||||
Debt extinguishment | 30,909 | 5,008 | |||||
Impairment loss | 20,861 | — | |||||
Changes in assets and liabilities: | |||||||
Accounts receivable | (9,696 | ) | 271 | ||||
Other assets | 1,529 | (4,834 | ) | ||||
Accrued expenses and other liabilities | (3,958 | ) | 7,107 | ||||
Net cash flow provided by operating activities | 114,054 | 87,665 | |||||
Cash flows from investing activities: | |||||||
Improvements and additions to hotels | (35,979 | ) | (65,547 | ) | |||
Hotel development | (31,599 | ) | (63,381 | ) | |||
Net proceeds from asset sales | 190,035 | 119,991 | |||||
Proceeds from unconsolidated joint venture transaction | — | 4,032 | |||||
Change in restricted cash – investing | (4,204 | ) | 42,964 | ||||
Insurance proceeds | 274 | 255 | |||||
Distributions from unconsolidated entities in excess of earnings | 6,460 | 10,658 | |||||
Net cash flow provided by investing activities | 124,987 | 48,972 | |||||
Cash flows from financing activities: | |||||||
Proceeds from borrowings | 979,000 | 439,607 | |||||
Repayment of borrowings | (1,166,693 | ) | (553,867 | ) | |||
Payment of deferred financing fees | (14,348 | ) | (3,052 | ) | |||
Acquisition of noncontrolling interest | — | (5,850 | ) | ||||
Distributions paid to noncontrolling interests | (16,294 | ) | (8,634 | ) | |||
Contributions from noncontrolling interests | 2,544 | 5,508 | |||||
Distributions paid to FelCor LP limited partners | (68 | ) | (31 | ) | |||
Distributions paid to preferred unitholders | (26,125 | ) | (29,034 | ) | |||
Redemption of preferred units | (169,986 | ) | — | ||||
Preferred distributions - consolidated joint venture | (1,070 | ) | (757 | ) | |||
Distributions paid to common unitholders | (16,498 | ) | (7,453 | ) | |||
Net proceeds from issuance of preferred capital - consolidated joint venture | 1,744 | 41,443 | |||||
Net proceeds from common unit issuance | 198,651 | — | |||||
Net cash flow used in financing activities | (229,143 | ) | (122,120 | ) | |||
Effect of exchange rate changes on cash | (134 | ) | (52 | ) | |||
Net change in cash and cash equivalents | 9,764 | 14,465 | |||||
Cash and cash equivalents at beginning of periods | 47,147 | 45,645 | |||||
Cash and cash equivalents at end of periods | $ | 56,911 | $ | 60,110 | |||
Supplemental cash flow information – interest paid, net of capitalized interest | $ | 55,215 | $ | 67,187 |
1. | Organization |
Brand | Hotels | Rooms | |||||
Embassy Suites Hotels® | 18 | 4,982 | |||||
Wyndham® and Wyndham Grand® | 8 | 2,528 | |||||
Marriott® and Renaissance® | 3 | 1,321 | |||||
Holiday Inn® | 2 | 968 | |||||
DoubleTree by Hilton® and Hilton® | 3 | 802 | |||||
Sheraton® | 2 | 673 | |||||
Fairmont® | 1 | 383 | |||||
The Knickerbocker® | 1 | 330 | |||||
Morgans® and Royalton® | 2 | 285 | |||||
Total | 40 | 12,272 |
• | A $20.7 million gain on the remeasurement of the fair value of the five previously unconsolidated hotels, which we controlled and wholly-owned following the transaction; |
• | A $30.2 million gain on the disposition of our unconsolidated interests in the five other hotels (net of $457,000 in transaction costs); |
• | A $3.5 million decrease in Additional Paid-In Capital related to our acquisition of the 10% noncontrolling interest of another hotel, which we wholly-owned following the transaction. |
Assets | |||
Investment in hotels | $ | 130,100 | |
Other assets | 1,300 | ||
Deferred expenses | 259 | ||
Total assets acquired | $ | 131,659 | |
Liabilities | |||
Debt | $ | 64,000 | |
Net assets acquired | $ | 67,659 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
Net income (loss) | $ | 73,640 | $ | 3,378 | $ | 84,408 | $ | (45,201 | ) | ||||||
Income (loss) per share/unit - basic | $ | 0.50 | $ | (0.06 | ) | $ | 0.43 | $ | (0.57 | ) | |||||
Income (loss) per share/unit - diluted | $ | 0.50 | $ | (0.06 | ) | $ | 0.42 | $ | (0.57 | ) |
3. | Investment in Unconsolidated Entities |
September 30, | December 31, | ||||||||
2015 | 2014 | ||||||||
Investment in hotels and other properties, net of accumulated depreciation | $ | 21,684 | $ | 30,288 | |||||
Total assets | $ | 32,510 | $ | 45,374 | |||||
Debt | $ | 22,994 | $ | 34,192 | |||||
Total liabilities | $ | 25,486 | $ | 36,974 | |||||
Equity | $ | 7,024 | $ | 8,400 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Total revenues | $ | 10,642 | $ | 15,699 | $ | 27,622 | $ | 52,644 | |||||||
Net income | $ | 836 | $ | 3,121 | $ | 22,906 | $ | 11,800 | |||||||
Net income attributable to FelCor | $ | 418 | $ | 1,561 | $ | 11,453 | $ | 5,900 | |||||||
Cost in excess of joint venture book value of sold hotel | — | — | (3,140 | ) | — | ||||||||||
Depreciation of cost in excess of book value | (97 | ) | (214 | ) | (330 | ) | (1,144 | ) | |||||||
Equity in income from unconsolidated entities | $ | 321 | $ | 1,347 | $ | 7,983 | $ | 4,756 |
September 30, | December 31, | ||||||||
2015 | 2014 | ||||||||
Equity basis of hotel joint venture investments | $ | (3,795 | ) | $ | (3,265 | ) | |||
Cost of hotel investments in excess of joint venture book value | 7,426 | 10,895 | |||||||
Equity basis of land and condominium joint venture investments | 7,307 | 7,465 | |||||||
Investment in unconsolidated entities | $ | 10,938 | $ | 15,095 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Hotel investments | $ | (63 | ) | $ | 1,029 | $ | 8,141 | $ | 5,022 | ||||||
Other investments | 384 | 318 | (158 | ) | (266 | ) | |||||||||
Equity in income from unconsolidated entities | $ | 321 | $ | 1,347 | $ | 7,983 | $ | 4,756 |
4. | Debt |
Encumbered | Interest | Maturity | September 30, | December 31, | |||||||||||||
Hotels | Rate (%) | Date | 2015 | 2014 | |||||||||||||
Senior unsecured notes | — | 6.00 | June 2025 | $ | 475,000 | $ | — | ||||||||||
Senior secured notes | 9 | 5.625 | March 2023 | 525,000 | 525,000 | ||||||||||||
Mortgage debt(a) | 4 | 4.95 | October 2022 | 122,923 | 124,278 | ||||||||||||
Mortgage debt | 1 | 4.94 | October 2022 | 30,848 | 31,228 | ||||||||||||
Line of credit | 7 | LIBOR + 2.75 | June 2019(b) | 200,000 | — | ||||||||||||
The Knickerbocker loan(c) | |||||||||||||||||
Construction tranche | 1 | LIBOR + 4.00 | May 2016 | 58,562 | 58,562 | ||||||||||||
Cash collateralized tranche | — | LIBOR + 1.25 | May 2016 | 6,299 | 6,299 | ||||||||||||
Retired debt | — | — | — | — | 840,500 | ||||||||||||
Total | 22 | $ | 1,418,632 | $ | 1,585,867 |
(a) | This debt is comprised of separate non-cross-collateralized loans, each secured by a mortgage encumbering different hotels. |
(b) | Our line of credit can be extended for one year (to 2020), subject to satisfying certain conditions. |
(c) | This construction loan (total capacity of $85.0 million) finances the redevelopment of The Knickerbocker and can be extended for one year, subject to satisfying certain conditions. |
5. | FelCor Capital Stock/FelCor LP Partners’ Capital |
6. | Hotel Operating Revenue, Departmental Expenses, and Other Property-Related Costs |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Room revenue | $ | 177,378 | $ | 185,969 | $ | 521,750 | $ | 556,036 | |||||||
Food and beverage revenue | 34,370 | 34,287 | 116,365 | 119,543 | |||||||||||
Other operating departments | 11,726 | 12,193 | 34,693 | 36,171 | |||||||||||
Total hotel operating revenue | $ | 223,474 | $ | 232,449 | $ | 672,808 | $ | 711,750 |
6. | Hotel Operating Revenue, Departmental Expenses, and Other Property-Related Costs — (continued) |
Three Months Ended September 30, | |||||||||||||||
2015 | 2014 | ||||||||||||||
Amount | % of Total Hotel Operating Revenue | Amount | % of Total Hotel Operating Revenue | ||||||||||||
Room | $ | 44,485 | 19.9 | % | $ | 48,348 | 20.8 | % | |||||||
Food and beverage | 29,457 | 13.2 | 28,667 | 12.3 | |||||||||||
Other operating departments | 4,572 | 2.0 | 5,716 | 2.5 | |||||||||||
Total hotel departmental expenses | $ | 78,514 | 35.1 | % | $ | 82,731 | 35.6 | % |
Nine Months Ended September 30, | |||||||||||||||
2015 | 2014 | ||||||||||||||
Amount | % of Total Hotel Operating Revenue | Amount | % of Total Hotel Operating Revenue | ||||||||||||
Room | $ | 131,419 | 19.5 | % | $ | 145,666 | 20.5 | % | |||||||
Food and beverage | 91,431 | 13.6 | 92,920 | 13.1 | |||||||||||
Other operating departments | 13,352 | 2.0 | 17,296 | 2.4 | |||||||||||
Total hotel departmental expenses | $ | 236,202 | 35.1 | % | $ | 255,882 | 36.0 | % |
Three Months Ended September 30, | |||||||||||||||
2015 | 2014 | ||||||||||||||
Amount | % of Total Hotel Operating Revenue | Amount | % of Total Hotel Operating Revenue | ||||||||||||
Hotel general and administrative expense | $ | 19,493 | 8.7 | % | $ | 19,669 | 8.5 | % | |||||||
Marketing | 18,595 | 8.3 | 19,013 | 8.2 | |||||||||||
Repair and maintenance | 9,724 | 4.4 | 10,887 | 4.7 | |||||||||||
Utilities | 8,081 | 3.6 | 9,872 | 4.2 | |||||||||||
Total other property-related costs | $ | 55,893 | 25.0 | % | $ | 59,441 | 25.6 | % |
6. | Hotel Operating Revenue, Departmental Expenses, and Other Property-Related Costs — (continued) |
Nine Months Ended September 30, | |||||||||||||||
2015 | 2014 | ||||||||||||||
Amount | % of Total Hotel Operating Revenue | Amount | % of Total Hotel Operating Revenue | ||||||||||||
Hotel general and administrative expense | $ | 59,388 | 8.8 | % | $ | 60,638 | 8.5 | % | |||||||
Marketing | 58,295 | 8.7 | 60,233 | 8.5 | |||||||||||
Repair and maintenance | 29,816 | 4.4 | 33,906 | 4.8 | |||||||||||
Utilities | 23,080 | 3.5 | 29,154 | 4.0 | |||||||||||
Total other property-related costs | $ | 170,579 | 25.4 | % | $ | 183,931 | 25.8 | % |
7. | Taxes, Insurance and Lease Expense |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Hotel lease expense(a) | $ | 1,524 | $ | 5,537 | $ | 5,762 | $ | 29,224 | |||||||
Land lease expense(b) | 3,892 | 3,670 | 10,684 | 9,292 | |||||||||||
Real estate and other taxes | 5,691 | 7,634 | 22,048 | 23,365 | |||||||||||
Property insurance, general liability insurance and other | 1,609 | 2,212 | 5,439 | 7,395 | |||||||||||
Total taxes, insurance and lease expense | $ | 12,716 | $ | 19,053 | $ | 43,933 | $ | 69,276 |
(a) | We record hotel lease expense for the consolidated operating lessees of hotels owned by unconsolidated entities and partially offset this expense through noncontrolling interests in other partnerships (generally 49%). We record our 50% share of the corresponding lease income through equity in income from unconsolidated entities. Hotel lease expense includes percentage rent of $726,000 and $3.3 million for the three months ended September 30, 2015 and 2014, respectively, and $2.8 million and $16.0 million for the nine months ended September 30, 2015 and 2014, respectively, and reflects a decrease attributable to the unwinding of our 10-hotel unconsolidated joint ventures in July 2014. |
(b) | We include in land lease expense percentage rent of $2.4 million and $2.2 million for the three months ended September 30, 2015 and 2014, respectively, and $6.1 million and $4.9 million for the nine months ended September 30, 2015 and 2014, respectively. |
8. | Impairment Charges |
9. | Hotel Dispositions |
Three Months Ended | Nine Months Ended | |||||||||||||||||
September 30, | September 30, | |||||||||||||||||
2015 | 2014 | 2015 | 2014 | |||||||||||||||
Hotel operating revenue | $ | 2,890 | $ | 32,952 | $ | 32,150 | $ | 135,918 | ||||||||||
Operating expenses | (2,396 | ) | (30,633 | ) | (26,016 | ) | (130,856 | ) | ||||||||||
Operating income | 494 | 2,319 | 6,134 | 5,062 | ||||||||||||||
Interest expense, net | — | (575 | ) | (1,031 | ) | (1,854 | ) | |||||||||||
Debt extinguishment | — | (914 | ) | (309 | ) | (932 | ) | |||||||||||
Gain on sale of investment in unconsolidated entities, net | — | 30,184 | — | 30,184 | ||||||||||||||
Equity in income from unconsolidated entities | 14 | 690 | 7,111 | 3,209 | ||||||||||||||
Income from continuing operations | 508 | 31,704 | 11,905 | 35,669 | ||||||||||||||
Gain on sale of hotels, net (a) | 3,154 | 29,556 | 19,491 | 50,639 | ||||||||||||||
Net income | 3,662 | 61,260 | 31,396 | 86,308 | ||||||||||||||
Net loss (income) attributable to noncontrolling interests in other partnerships | 45 | (838 | ) | (5,146 | ) | (1,333 | ) | |||||||||||
Net income attributable to redeemable noncontrolling interests in FelCor LP | (16 | ) | (290 | ) | (110 | ) | (408 | ) | ||||||||||
Net income attributable to FelCor | $ | 3,691 | $ | 60,132 | $ | 26,140 | $ | 84,567 |
(a) | We recorded a $24.4 million gain from foreign currency translation (which we had previously recorded in accumulated other comprehensive income) when we sold our remaining Canadian hotel in the third quarter of 2014, which substantially liquidated all of our foreign investments. |
10. | Income (Loss) Per Share/Unit |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Numerator: | |||||||||||||||
Net income (loss) attributable to FelCor | $ | (8,208 | ) | $ | 72,391 | $ | (4,709 | ) | $ | 81,854 | |||||
Discontinued operations attributable to FelCor | (496 | ) | 8 | (425 | ) | (131 | ) | ||||||||
Income (loss) from continuing operations attributable to FelCor | (8,704 | ) | 72,399 | (5,134 | ) | 81,723 | |||||||||
Less: Preferred dividends | (6,279 | ) | (9,678 | ) | (23,860 | ) | (29,034 | ) | |||||||
Less: Redemption of preferred stock | — | — | (6,096 | ) | — | ||||||||||
Less: Dividends declared on unvested restricted stock | (13 | ) | (2 | ) | (40 | ) | (5 | ) | |||||||
Less: Undistributed earnings allocated to unvested restricted stock | — | (48 | ) | — | (18 | ) | |||||||||
Numerator for continuing operations attributable to FelCor common stockholders | (14,996 | ) | 62,671 | (35,130 | ) | 52,666 | |||||||||
Discontinued operations attributable to FelCor | 496 | (8 | ) | 425 | 131 | ||||||||||
Numerator for basic and diluted income (loss) attributable to FelCor common stockholders | $ | (14,500 | ) | $ | 62,663 | $ | (34,705 | ) | $ | 52,797 | |||||
Denominator: | |||||||||||||||
Denominator for basic income (loss) per share | 142,982 | 124,168 | 136,009 | 124,159 | |||||||||||
Denominator for diluted income (loss) per share | 142,982 | 125,526 | 136,009 | 125,289 | |||||||||||
Basic and diluted income (loss) per share data: | |||||||||||||||
Basic: | |||||||||||||||
Income (loss) from continuing operations | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Net income (loss) | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.43 | |||||
Diluted: | |||||||||||||||
Income (loss) from continuing operations | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Net income (loss) | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 |
10. | Income (Loss) Per Share/Unit — (continued) |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Numerator: | |||||||||||||||
Net income (loss) attributable to FelCor LP | $ | (8,269 | ) | $ | 72,576 | $ | (4,859 | ) | $ | 81,989 | |||||
Discontinued operations attributable to FelCor LP | (498 | ) | 8 | (427 | ) | (132 | ) | ||||||||
Income (loss) from continuing operations attributable to FelCor LP | (8,767 | ) | 72,584 | (5,286 | ) | 81,857 | |||||||||
Less: Preferred distributions | (6,279 | ) | (9,678 | ) | (23,860 | ) | (29,034 | ) | |||||||
Less: Redemption of preferred units | — | — | (6,096 | ) | — | ||||||||||
Less: Distributions declared on FelCor unvested restricted stock | (13 | ) | (2 | ) | (40 | ) | (5 | ) | |||||||
Less: Undistributed earnings allocated to FelCor unvested restricted stock | — | (48 | ) | — | (18 | ) | |||||||||
Numerator for continuing operations attributable to FelCor LP common unitholders | (15,059 | ) | 62,856 | (35,282 | ) | 52,800 | |||||||||
Discontinued operations attributable to FelCor LP | 498 | (8 | ) | 427 | 132 | ||||||||||
Numerator for basic and diluted income (loss) attributable to FelCor common unitholders | $ | (14,561 | ) | $ | 62,848 | $ | (34,855 | ) | $ | 52,932 | |||||
Denominator: | |||||||||||||||
Denominator for basic income (loss) per unit | 143,594 | 124,781 | 136,621 | 124,774 | |||||||||||
Denominator for diluted income (loss) per unit | 143,594 | 126,164 | 136,621 | 125,916 | |||||||||||
Basic and diluted income (loss) per unit data: | |||||||||||||||
Basic: | |||||||||||||||
Income (loss) from continuing operations | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Net income (loss) | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Diluted: | |||||||||||||||
Income (loss) from continuing operations | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 | |||||
Net income (loss) | $ | (0.10 | ) | $ | 0.50 | $ | (0.26 | ) | $ | 0.42 |
Three Months Ended | Nine Months Ended | |||||||||
September 30, | September 30, | |||||||||
2015 | 2014 | 2015 | 2014 | |||||||
Series A convertible preferred shares/units | 9,984 | 9,985 | 9,984 | 9,985 | ||||||
FelCor restricted stock units | 1,173 | — | 1,136 | — |
10. | Income (Loss) Per Share/Unit — (continued) |
11. | Fair Value of Financial Instruments |
12. | Redeemable Noncontrolling Interests in FelCor LP / Redeemable Units |
12. | Redeemable Noncontrolling Interests in FelCor LP / Redeemable Units — (continued) |
Nine Months Ended | |||||||||
September 30, | |||||||||
2015 | 2014 | ||||||||
Balance at beginning of period | $ | 6,616 | $ | 5,039 | |||||
Conversion of units | — | (56 | ) | ||||||
Redemption value allocation | (2,076 | ) | 642 | ||||||
Distributions paid to unitholders | (67 | ) | (36 | ) | |||||
Comprehensive income (loss): | |||||||||
Foreign exchange translation | — | (1 | ) | ||||||
Net income (loss) | (150 | ) | 135 | ||||||
Balance at end of period | $ | 4,323 | $ | 5,723 |
17. | FelCor LP’s Consolidating Financial Information |
17. | FelCor LP’s Consolidating Financial Information — (continued) |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Net investment in hotels | $ | — | $ | 621,978 | $ | 1,072,088 | $ | — | $ | 1,694,066 | |||||||||
Hotel development | — | — | 48,655 | — | 48,655 | ||||||||||||||
Equity investment in consolidated entities | 1,292,813 | — | — | (1,292,813 | ) | — | |||||||||||||
Investment in unconsolidated entities | 4,544 | 5,118 | 1,276 | — | 10,938 | ||||||||||||||
Cash and cash equivalents | 18,453 | 36,464 | 1,994 | — | 56,911 | ||||||||||||||
Restricted cash | — | 14,163 | 10,538 | — | 24,701 | ||||||||||||||
Accounts receivable, net | 440 | 33,459 | 3,186 | — | 37,085 | ||||||||||||||
Deferred expenses, net | 16,163 | — | 9,077 | — | 25,240 | ||||||||||||||
Other assets | 4,512 | 8,615 | 3,447 | — | 16,574 | ||||||||||||||
Total assets | $ | 1,336,925 | $ | 719,797 | $ | 1,150,261 | $ | (1,292,813 | ) | $ | 1,914,170 | ||||||||
Debt | $ | 1,000,000 | $ | — | $ | 458,068 | $ | (39,436 | ) | $ | 1,418,632 | ||||||||
Distributions payable | 12,331 | — | 119 | — | 12,450 | ||||||||||||||
Accrued expenses and other liabilities | 26,103 | 88,390 | 17,828 | — | 132,321 | ||||||||||||||
Total liabilities | 1,038,434 | 88,390 | 476,015 | (39,436 | ) | 1,563,403 | |||||||||||||
Redeemable units, at redemption value | 4,323 | — | — | — | 4,323 | ||||||||||||||
Preferred units | 309,337 | — | — | — | 309,337 | ||||||||||||||
Common units | (15,169 | ) | 632,039 | 621,338 | (1,253,377 | ) | (15,169 | ) | |||||||||||
Total FelCor LP partners’ capital | 294,168 | 632,039 | 621,338 | (1,253,377 | ) | 294,168 | |||||||||||||
Noncontrolling interests | — | (632 | ) | 9,722 | — | 9,090 | |||||||||||||
Preferred capital in consolidated joint venture | — | — | 43,186 | — | 43,186 | ||||||||||||||
Total partners’ capital | 294,168 | 631,407 | 674,246 | (1,253,377 | ) | 346,444 | |||||||||||||
Total liabilities and partners’ capital | $ | 1,336,925 | $ | 719,797 | $ | 1,150,261 | $ | (1,292,813 | ) | $ | 1,914,170 |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Net investment in hotels | $ | — | $ | 757,694 | $ | 842,097 | $ | — | $ | 1,599,791 | |||||||||
Hotel development | — | — | 297,466 | — | 297,466 | ||||||||||||||
Equity investment in consolidated entities | 1,364,470 | — | — | (1,364,470 | ) | — | |||||||||||||
Investment in unconsolidated entities | 7,270 | 6,514 | 1,311 | — | 15,095 | ||||||||||||||
Hotels held for sale | — | — | 47,145 | — | 47,145 | ||||||||||||||
Cash and cash equivalents | 5,717 | 32,923 | 8,507 | — | 47,147 | ||||||||||||||
Restricted cash | — | 12,199 | 8,297 | — | 20,496 | ||||||||||||||
Accounts receivable, net | 963 | 26,343 | 499 | — | 27,805 | ||||||||||||||
Deferred expenses, net | 17,203 | — | 8,624 | — | 25,827 | ||||||||||||||
Other assets | 4,866 | 11,510 | 7,510 | — | 23,886 | ||||||||||||||
Total assets | $ | 1,400,489 | $ | 847,183 | $ | 1,221,456 | $ | (1,364,470 | ) | $ | 2,104,658 | ||||||||
Debt | $ | 1,050,000 | $ | — | $ | 576,654 | $ | (40,787 | ) | $ | 1,585,867 | ||||||||
Distributions payable | 13,709 | — | 118 | — | 13,827 | ||||||||||||||
Accrued expenses and other liabilities | 27,174 | 93,690 | 14,617 | — | 135,481 | ||||||||||||||
Total liabilities | 1,090,883 | 93,690 | 591,389 | (40,787 | ) | 1,735,175 | |||||||||||||
Redeemable units, at redemption value | 6,616 | — | — | — | 6,616 | ||||||||||||||
Preferred units | 478,749 | — | — | — | 478,749 | ||||||||||||||
Common units | (175,759 | ) | 753,646 | 570,037 | (1,323,683 | ) | (175,759 | ) | |||||||||||
Total FelCor LP partners’ capital | 302,990 | 753,646 | 570,037 | (1,323,683 | ) | 302,990 | |||||||||||||
Noncontrolling interests | — | (153 | ) | 18,588 | — | 18,435 | |||||||||||||
Preferred capital in consolidated joint venture | — | — | 41,442 | — | 41,442 | ||||||||||||||
Total partners’ capital | 302,990 | 753,493 | 630,067 | (1,323,683 | ) | 362,867 | |||||||||||||
Total liabilities and partners’ capital | $ | 1,400,489 | $ | 847,183 | $ | 1,221,456 | $ | (1,364,470 | ) | $ | 2,104,658 |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Revenues: | |||||||||||||||||||
Hotel operating revenue | $ | — | $ | 223,474 | $ | — | $ | — | $ | 223,474 | |||||||||
Percentage lease revenue | — | — | 44,523 | (44,523 | ) | — | |||||||||||||
Other revenue | 3 | 1,497 | 178 | — | 1,678 | ||||||||||||||
Total revenues | 3 | 224,971 | 44,701 | (44,523 | ) | 225,152 | |||||||||||||
Expenses: | |||||||||||||||||||
Hotel operating expenses | — | 143,545 | — | — | 143,545 | ||||||||||||||
Taxes, insurance and lease expense | 533 | 53,272 | 3,434 | (44,523 | ) | 12,716 | |||||||||||||
Corporate expenses | — | 2,718 | 1,954 | — | 4,672 | ||||||||||||||
Depreciation and amortization | 49 | 11,876 | 17,063 | — | 28,988 | ||||||||||||||
Impairment loss | — | 20,861 | — | — | 20,861 | ||||||||||||||
Other expenses | 3,626 | 1,311 | 870 | — | 5,807 | ||||||||||||||
Total operating expenses | 4,208 | 233,583 | 23,321 | (44,523 | ) | 216,589 | |||||||||||||
Operating income | (4,205 | ) | (8,612 | ) | 21,380 | — | 8,563 | ||||||||||||
Interest expense, net | (14,302 | ) | 3 | (5,303 | ) | — | (19,602 | ) | |||||||||||
Debt extinguishment | (13 | ) | — | — | — | (13 | ) | ||||||||||||
Loss before equity in income from unconsolidated entities | (18,520 | ) | (8,609 | ) | 16,077 | — | (11,052 | ) | |||||||||||
Equity in income from consolidated entities | 10,069 | — | — | (10,069 | ) | — | |||||||||||||
Equity in income from unconsolidated entities | 417 | (85 | ) | (11 | ) | — | 321 | ||||||||||||
Loss from continuing operations before income tax expense | (8,034 | ) | (8,694 | ) | 16,066 | (10,069 | ) | (10,731 | ) | ||||||||||
Income tax expense | (194 | ) | (860 | ) | — | — | (1,054 | ) | |||||||||||
Loss from continuing operations | (8,228 | ) | (9,554 | ) | 16,066 | (10,069 | ) | (11,785 | ) | ||||||||||
Income from discontinued operations | — | (2 | ) | 500 | — | 498 | |||||||||||||
Loss before gain on sale of hotels | (8,228 | ) | (9,556 | ) | 16,566 | (10,069 | ) | (11,287 | ) | ||||||||||
Gain on sale of hotels, net | (41 | ) | (31 | ) | 3,226 | — | 3,154 | ||||||||||||
Net loss | (8,269 | ) | (9,587 | ) | 19,792 | (10,069 | ) | (8,133 | ) | ||||||||||
Loss attributable to noncontrolling interests | — | 81 | 146 | — | 227 | ||||||||||||||
Preferred distributions - consolidated joint venture | — | — | (363 | ) | — | (363 | ) | ||||||||||||
Net loss attributable to FelCor LP | (8,269 | ) | (9,506 | ) | 19,575 | (10,069 | ) | (8,269 | ) | ||||||||||
Preferred distributions | (6,279 | ) | — | — | — | (6,279 | ) | ||||||||||||
Net loss attributable to FelCor LP common unitholders | $ | (14,548 | ) | $ | (9,506 | ) | $ | 19,575 | $ | (10,069 | ) | $ | (14,548 | ) |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Revenues: | |||||||||||||||||||
Hotel operating revenue | $ | — | $ | 232,449 | $ | — | $ | — | $ | 232,449 | |||||||||
Percentage lease revenue | 2,537 | — | 36,131 | (38,668 | ) | — | |||||||||||||
Other revenue | 3 | 1,425 | 179 | — | 1,607 | ||||||||||||||
Total revenues | 2,540 | 233,874 | 36,310 | (38,668 | ) | 234,056 | |||||||||||||
Expenses: | |||||||||||||||||||
Hotel operating expenses | — | 151,804 | — | — | 151,804 | ||||||||||||||
Taxes, insurance and lease expense | 492 | 52,036 | 5,193 | (38,668 | ) | 19,053 | |||||||||||||
Corporate expenses | 152 | 3,801 | 2,489 | — | 6,442 | ||||||||||||||
Depreciation and amortization | 694 | 14,075 | 13,754 | — | 28,523 | ||||||||||||||
Other expenses | 84 | 7,116 | 2,546 | — | 9,746 | ||||||||||||||
Total operating expenses | 1,422 | 228,832 | 23,982 | (38,668 | ) | 215,568 | |||||||||||||
Operating income | 1,118 | 5,042 | 12,328 | — | 18,488 | ||||||||||||||
Interest expense, net | (16,850 | ) | (126 | ) | (4,946 | ) | — | (21,922 | ) | ||||||||||
Debt extinguishment | (3,816 | ) | — | (914 | ) | — | (4,730 | ) | |||||||||||
Gain on sale of investment in unconsolidated entities, net | 30,184 | — | — | — | 30,184 | ||||||||||||||
Gain from remeasurement of unconsolidated entities, net | 20,733 | — | — | — | 20,733 | ||||||||||||||
Income before equity in income from unconsolidated entities | 31,369 | 4,916 | 6,468 | — | 42,753 | ||||||||||||||
Equity in income from consolidated entities | 40,734 | — | — | (40,734 | ) | — | |||||||||||||
Equity in income from unconsolidated entities | 1,099 | 259 | (11 | ) | — | 1,347 | |||||||||||||
Income from continuing operations before income tax expense | 73,202 | 5,175 | 6,457 | (40,734 | ) | 44,100 | |||||||||||||
Income tax expense | (14 | ) | (64 | ) | — | — | (78 | ) | |||||||||||
Income from continuing operations | 73,188 | 5,111 | 6,457 | (40,734 | ) | 44,022 | |||||||||||||
Loss from discontinued operations | — | (8 | ) | — | — | (8 | ) | ||||||||||||
Income before gain on sale of hotels | 73,188 | 5,103 | 6,457 | (40,734 | ) | 44,014 | |||||||||||||
Gain on sale of hotels, net | (612 | ) | 22,176 | 7,992 | — | 29,556 | |||||||||||||
Net income | 72,576 | 27,279 | 14,449 | (40,734 | ) | 73,570 | |||||||||||||
Income attributable to noncontrolling interests | — | 217 | (863 | ) | — | (646 | ) | ||||||||||||
Preferred distributions - consolidated joint venture | — | — | (348 | ) | — | (348 | ) | ||||||||||||
Net income attributable to FelCor LP | 72,576 | 27,496 | 13,238 | (40,734 | ) | 72,576 | |||||||||||||
Preferred distributions | (9,678 | ) | — | — | — | (9,678 | ) | ||||||||||||
Net income attributable to FelCor LP common unitholders | $ | 62,898 | $ | 27,496 | $ | 13,238 | $ | (40,734 | ) | $ | 62,898 |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Revenues: | |||||||||||||||||||
Hotel operating revenue | $ | — | $ | 672,808 | $ | — | $ | — | $ | 672,808 | |||||||||
Percentage lease revenue | — | — | 130,397 | (130,397 | ) | — | |||||||||||||
Other revenue | 111 | 6,645 | 386 | — | 7,142 | ||||||||||||||
Total revenues | 111 | 679,453 | 130,783 | (130,397 | ) | 679,950 | |||||||||||||
Expenses: | |||||||||||||||||||
Hotel operating expenses | — | 434,206 | — | — | 434,206 | ||||||||||||||
Taxes, insurance and lease expense | 422 | 159,103 | 14,805 | (130,397 | ) | 43,933 | |||||||||||||
Corporate expenses | — | 11,010 | 8,765 | — | 19,775 | ||||||||||||||
Depreciation and amortization | 138 | 37,770 | 47,602 | — | 85,510 | ||||||||||||||
Impairment loss | — | 20,861 | — | — | 20,861 | ||||||||||||||
Other expenses | 3,629 | 6,820 | 997 | — | 11,446 | ||||||||||||||
Total operating expenses | 4,189 | 669,770 | 72,169 | (130,397 | ) | 615,731 | |||||||||||||
Operating income | (4,078 | ) | 9,683 | 58,614 | — | 64,219 | |||||||||||||
Interest expense, net | (42,613 | ) | 8 | (16,756 | ) | — | (59,361 | ) | |||||||||||
Debt extinguishment | (28,459 | ) | — | (2,450 | ) | — | (30,909 | ) | |||||||||||
Other gains, net | — | — | 166 | — | 166 | ||||||||||||||
Loss before equity in income from unconsolidated entities | (75,150 | ) | 9,691 | 39,574 | — | (25,885 | ) | ||||||||||||
Equity in income from consolidated entities | 62,807 | — | — | (62,807 | ) | — | |||||||||||||
Equity in income from unconsolidated entities | 8,060 | (43 | ) | (34 | ) | — | 7,983 | ||||||||||||
Loss from continuing operations before income tax expense | (4,283 | ) | 9,648 | 39,540 | (62,807 | ) | (17,902 | ) | |||||||||||
Income tax expense | (256 | ) | (1,136 | ) | — | — | (1,392 | ) | |||||||||||
Loss from continuing operations | (4,539 | ) | 8,512 | 39,540 | (62,807 | ) | (19,294 | ) | |||||||||||
Income from discontinued operations | — | 2 | 417 | — | 419 | ||||||||||||||
Loss before gain on sale of hotels | (4,539 | ) | 8,514 | 39,957 | (62,807 | ) | (18,875 | ) | |||||||||||
Gain on sale of hotels, net | (320 | ) | (44 | ) | 19,855 | — | 19,491 | ||||||||||||
Net income | (4,859 | ) | 8,470 | 59,812 | (62,807 | ) | 616 | ||||||||||||
Income attributable to noncontrolling interests | — | 591 | (4,996 | ) | — | (4,405 | ) | ||||||||||||
Preferred distributions - consolidated joint venture | — | — | (1,070 | ) | — | (1,070 | ) | ||||||||||||
Net loss attributable to FelCor LP | (4,859 | ) | 9,061 | 53,746 | (62,807 | ) | (4,859 | ) | |||||||||||
Preferred distributions | (23,860 | ) | — | — | — | (23,860 | ) | ||||||||||||
Redemption of preferred units | (6,096 | ) | — | — | — | (6,096 | ) | ||||||||||||
Net loss attributable to FelCor LP common unitholders | $ | (34,815 | ) | $ | 9,061 | $ | 53,746 | $ | (62,807 | ) | $ | (34,815 | ) |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Revenues: | |||||||||||||||||||
Hotel operating revenue | $ | — | $ | 711,750 | $ | — | $ | — | $ | 711,750 | |||||||||
Percentage lease revenue | 5,846 | — | 100,719 | (106,565 | ) | — | |||||||||||||
Other revenue | 4 | 2,774 | 392 | — | 3,170 | ||||||||||||||
Total revenues | 5,850 | 714,524 | 101,111 | (106,565 | ) | 714,920 | |||||||||||||
Expenses: | |||||||||||||||||||
Hotel operating expenses | — | 468,618 | — | — | 468,618 | ||||||||||||||
Taxes, insurance and lease expense | 1,287 | 160,081 | 14,473 | (106,565 | ) | 69,276 | |||||||||||||
Corporate expenses | 423 | 12,944 | 8,547 | — | 21,914 | ||||||||||||||
Depreciation and amortization | 2,678 | 43,332 | 41,196 | — | 87,206 | ||||||||||||||
Other expenses | 119 | 8,745 | 5,010 | — | 13,874 | ||||||||||||||
Total operating expenses | 4,507 | 693,720 | 69,226 | (106,565 | ) | 660,888 | |||||||||||||
Operating income | 1,343 | 20,804 | 31,885 | — | 54,032 | ||||||||||||||
Interest expense, net | (57,634 | ) | (760 | ) | (13,250 | ) | — | (71,644 | ) | ||||||||||
Debt extinguishment | (3,816 | ) | — | (947 | ) | — | (4,763 | ) | |||||||||||
Gain on sale of investment in unconsolidated entities, net | 30,184 | — | — | — | 30,184 | ||||||||||||||
Gain from remeasurement of unconsolidated entities, net | 20,733 | — | — | — | 20,733 | ||||||||||||||
Other gains, net | — | 100 | — | — | 100 | ||||||||||||||
Income before equity in income from unconsolidated entities | (9,190 | ) | 20,144 | 17,688 | — | 28,642 | |||||||||||||
Equity in income from consolidated entities | 88,114 | — | — | (88,114 | ) | — | |||||||||||||
Equity in income from unconsolidated entities | 4,213 | 577 | (34 | ) | — | 4,756 | |||||||||||||
Income from continuing operations | 83,137 | 20,721 | 17,654 | (88,114 | ) | 33,398 | |||||||||||||
Income tax expense | (88 | ) | (392 | ) | — | — | (480 | ) | |||||||||||
Income from continuing operations | 83,049 | 20,329 | 17,654 | (88,114 | ) | 32,918 | |||||||||||||
Income from discontinued operations | — | 26 | 106 | — | 132 | ||||||||||||||
Income before gain on sale of hotels | 83,049 | 20,355 | 17,760 | (88,114 | ) | 33,050 | |||||||||||||
Gain on sale of hotels, net | (1,060 | ) | 22,147 | 29,552 | — | 50,639 | |||||||||||||
Net income | 81,989 | 42,502 | 47,312 | (88,114 | ) | 83,689 | |||||||||||||
Income attributable to noncontrolling interests | — | 238 | (1,068 | ) | — | (830 | ) | ||||||||||||
Preferred distributions - consolidated joint venture | — | — | (870 | ) | — | (870 | ) | ||||||||||||
Net income attributable to FelCor LP | 81,989 | 42,740 | 45,374 | (88,114 | ) | 81,989 | |||||||||||||
Preferred distributions | (29,034 | ) | — | — | — | (29,034 | ) | ||||||||||||
Net income attributable to FelCor LP common unitholders | $ | 52,955 | $ | 42,740 | $ | 45,374 | $ | (88,114 | ) | $ | 52,955 |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Net loss | $ | (8,269 | ) | $ | (9,587 | ) | $ | 19,792 | $ | (10,069 | ) | $ | (8,133 | ) | |||||
Foreign currency translation adjustment | — | — | — | — | — | ||||||||||||||
Comprehensive loss | (8,269 | ) | (9,587 | ) | 19,792 | (10,069 | ) | (8,133 | ) | ||||||||||
Comprehensive loss attributable to noncontrolling interests | — | 81 | 146 | — | 227 | ||||||||||||||
Preferred distributions - consolidated joint venture | — | — | (363 | ) | — | (363 | ) | ||||||||||||
Comprehensive loss attributable to FelCor LP | $ | (8,269 | ) | $ | (9,506 | ) | $ | 19,575 | $ | (10,069 | ) | $ | (8,269 | ) |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Net income | $ | 72,576 | $ | 27,279 | $ | 14,449 | $ | (40,734 | ) | $ | 73,570 | ||||||||
Foreign currency translation adjustment | (445 | ) | (103 | ) | (342 | ) | 445 | (445 | ) | ||||||||||
Reclassification of foreign currency translation to gain | (24,553 | ) | (4,448 | ) | (20,105 | ) | 24,553 | (24,553 | ) | ||||||||||
Comprehensive income | 47,578 | 22,728 | (5,998 | ) | (15,736 | ) | 48,572 | ||||||||||||
Comprehensive income attributable to noncontrolling interests | — | 217 | (863 | ) | — | (646 | ) | ||||||||||||
Preferred distributions - consolidated joint venture | — | — | (348 | ) | — | (348 | ) | ||||||||||||
Comprehensive income attributable to FelCor LP | $ | 47,578 | $ | 22,945 | $ | (7,209 | ) | $ | (15,736 | ) | $ | 47,578 |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Net income | $ | (4,859 | ) | $ | 8,470 | $ | 59,812 | $ | (62,807 | ) | $ | 616 | |||||||
Foreign currency translation adjustment | — | — | — | — | — | ||||||||||||||
Comprehensive income | (4,859 | ) | 8,470 | 59,812 | (62,807 | ) | 616 | ||||||||||||
Comprehensive income attributable to noncontrolling interests | — | 591 | (4,996 | ) | — | (4,405 | ) | ||||||||||||
Preferred distributions - consolidated joint venture | — | — | (1,070 | ) | — | (1,070 | ) | ||||||||||||
Comprehensive loss attributable to FelCor LP | $ | (4,859 | ) | $ | 9,061 | $ | 53,746 | $ | (62,807 | ) | $ | (4,859 | ) |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Net income | $ | 81,989 | $ | 42,502 | $ | 47,312 | $ | (88,114 | ) | $ | 83,689 | ||||||||
Foreign currency translation adjustment | (490 | ) | (121 | ) | (369 | ) | 490 | (490 | ) | ||||||||||
Reclassification of foreign currency translation to gain | (24,553 | ) | (4,448 | ) | (20,105 | ) | 24,553 | (24,553 | ) | ||||||||||
Comprehensive income | 56,946 | 37,933 | 26,838 | (63,071 | ) | 58,646 | |||||||||||||
Comprehensive income attributable to noncontrolling interests | — | 238 | (1,068 | ) | — | (830 | ) | ||||||||||||
Preferred distributions - consolidated joint venture | — | — | (870 | ) | — | (870 | ) | ||||||||||||
Comprehensive income attributable to FelCor LP | $ | 56,946 | $ | 38,171 | $ | 24,900 | $ | (63,071 | ) | $ | 56,946 |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Operating activities: | |||||||||||||||||||
Cash flows from operating activities | $ | (40,101 | ) | $ | 59,884 | $ | 94,271 | $ | — | $ | 114,054 | ||||||||
Investing activities: | |||||||||||||||||||
Improvements and additions to hotels | (13 | ) | (21,664 | ) | (14,302 | ) | — | (35,979 | ) | ||||||||||
Hotel development | — | — | (31,599 | ) | — | (31,599 | ) | ||||||||||||
Net proceeds from asset sales | (429 | ) | 10 | 190,454 | — | 190,035 | |||||||||||||
Insurance proceeds | 274 | — | — | — | 274 | ||||||||||||||
Change in restricted cash - investing | — | (1,964 | ) | (2,240 | ) | — | (4,204 | ) | |||||||||||
Distributions from unconsolidated entities | 6,460 | — | — | — | 6,460 | ||||||||||||||
Intercompany financing | 139,524 | — | — | (139,524 | ) | — | |||||||||||||
Cash flows from investing activities | 145,816 | (23,618 | ) | 142,313 | (139,524 | ) | 124,987 | ||||||||||||
Financing activities: | |||||||||||||||||||
Proceeds from borrowings | 475,000 | — | 504,000 | — | 979,000 | ||||||||||||||
Repayment of borrowings | (545,453 | ) | — | (621,240 | ) | — | (1,166,693 | ) | |||||||||||
Payment of deferred financing fees | (8,500 | ) | — | (5,848 | ) | — | (14,348 | ) | |||||||||||
Distributions paid to noncontrolling interests | — | (401 | ) | (15,893 | ) | — | (16,294 | ) | |||||||||||
Contributions from noncontrolling interests | — | 513 | 2,031 | — | 2,544 | ||||||||||||||
Redemption of preferred units | (169,986 | ) | — | — | — | (169,986 | ) | ||||||||||||
Distributions paid to preferred unitholders | (26,125 | ) | — | — | — | (26,125 | ) | ||||||||||||
Distributions paid to common unitholders | (16,498 | ) | — | — | — | (16,498 | ) | ||||||||||||
Net proceeds from issuance of preferred capital - consolidated joint venture | — | — | 1,744 | — | 1,744 | ||||||||||||||
Net proceeds from common stock issuance | 198,651 | — | — | — | 198,651 | ||||||||||||||
Intercompany financing | — | (32,703 | ) | (106,821 | ) | 139,524 | — | ||||||||||||
Other | (68 | ) | — | (1,070 | ) | — | (1,138 | ) | |||||||||||
Cash flows from financing activities | (92,979 | ) | (32,591 | ) | (243,097 | ) | 139,524 | (229,143 | ) | ||||||||||
Effect of exchange rate changes on cash | — | (134 | ) | — | — | (134 | ) | ||||||||||||
Change in cash and cash equivalents | 12,736 | 3,541 | (6,513 | ) | — | 9,764 | |||||||||||||
Cash and cash equivalents at beginning of period | 5,717 | 32,923 | 8,507 | — | 47,147 | ||||||||||||||
Cash and cash equivalents at end of period | $ | 18,453 | $ | 36,464 | $ | 1,994 | $ | — | $ | 56,911 |
FelCor LP | Subsidiary Guarantors | Non-Guarantor Subsidiaries | Eliminations | Total Consolidated | |||||||||||||||
Operating activities: | |||||||||||||||||||
Cash flows from operating activities | $ | (50,911 | ) | $ | 71,441 | $ | 67,135 | $ | — | $ | 87,665 | ||||||||
Investing activities: | |||||||||||||||||||
Improvements and additions to hotels | (409 | ) | (36,685 | ) | (28,453 | ) | — | (65,547 | ) | ||||||||||
Hotel development | — | — | (63,381 | ) | — | (63,381 | ) | ||||||||||||
Net proceeds from asset sales | (1,091 | ) | 13,998 | 107,084 | — | 119,991 | |||||||||||||
Proceeds from unconsolidated joint venture transaction | 3,154 | — | 878 | — | 4,032 | ||||||||||||||
Insurance proceeds | — | 255 | — | — | 255 | ||||||||||||||
Change in restricted cash - investing | — | (1,783 | ) | 44,747 | — | 42,964 | |||||||||||||
Distributions from unconsolidated entities | 6,052 | 4,606 | — | — | 10,658 | ||||||||||||||
Intercompany financing | 328,666 | — | — | (328,666 | ) | — | |||||||||||||
Cash flows from investing activities | 336,372 | (19,609 | ) | 60,875 | (328,666 | ) | 48,972 | ||||||||||||
Financing activities: | |||||||||||||||||||
Proceeds from borrowings | — | — | 439,607 | — | 439,607 | ||||||||||||||
Repayment of borrowings | (236,738 | ) | — | (317,129 | ) | — | (553,867 | ) | |||||||||||
Payment of deferred financing fees | (4 | ) | — | (3,048 | ) | — | (3,052 | ) | |||||||||||
Acquisition of noncontrolling interest | — | — | (5,850 | ) | — | (5,850 | ) | ||||||||||||
Distributions paid to preferred unitholders | (29,034 | ) | — | — | — | (29,034 | ) | ||||||||||||
Distributions paid to common unitholders | (7,453 | ) | — | — | — | (7,453 | ) | ||||||||||||
Distributions paid to noncontrolling interests | — | (684 | ) | (7,950 | ) | — | (8,634 | ) | |||||||||||
Contributions from noncontrolling interests | — | 901 | 4,607 | — | 5,508 | ||||||||||||||
Net proceeds from issuance of preferred capital- consolidated joint venture | — | — | 41,443 | — | 41,443 | ||||||||||||||
Intercompany financing | — | (46,510 | ) | (282,156 | ) | 328,666 | — | ||||||||||||
Other | (31 | ) | — | (757 | ) | — | (788 | ) | |||||||||||
Cash flows from financing activities | (273,260 | ) | (46,293 | ) | (131,233 | ) | 328,666 | (122,120 | ) | ||||||||||
Effect of exchange rate changes on cash | — | (52 | ) | — | — | (52 | ) | ||||||||||||
Change in cash and cash equivalents | 12,201 | 5,487 | (3,223 | ) | — | 14,465 | |||||||||||||
Cash and cash equivalents at beginning of period | 5,227 | 33,283 | 7,135 | — | 45,645 | ||||||||||||||
Cash and cash equivalents at end of period | $ | 17,428 | $ | 38,770 | $ | 3,912 | $ | — | $ | 60,110 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
• | In April 2015, we issued 18.4 million shares of our common stock for aggregate net proceeds of approximately $199 million (after deducting underwriting discounts and commissions and expenses). |
• | In April 2015, we called all of our outstanding shares of 8% Series C Cumulative Redeemable Preferred Stock, or the Series C Preferred Stock, and all depositary shares representing the Series C Preferred Stock for redemption. We redeemed the shares of Series C Preferred Stock and the depositary shares on May 14, 2015 with proceeds from our April 2015 equity offering. Including accrued dividends ($491,000), the total redemption price was $170.4 million. |
• | In May 2015, we issued $475 million aggregate principal amount of our 6.00% senior notes due 2025. We used the proceeds from that issuance, together with cash on hand and funds drawn under our line of credit, to repurchase and redeem $525 million aggregate principal amount of our 6.75% senior secured notes due 2019, which was secured by mortgages on six hotels. |
• | In June 2015, we amended and restated our secured line of credit facility primarily to expand our borrowing capacity from $225 million to $400 million. The amended facility now matures in June 2020 (extended from June 2017), assuming we exercise a one-year extension option, which is subject to satisfaction of certain conditions. Borrowings under the facility bear interest at LIBOR (no floor) plus an applicable margin ranging from 225 to 275 basis points (reduced from 337.5 basis points), depending on our leverage. The facility is secured by mortgages on seven hotels and permits partial release and substitution of properties, subject to certain conditions. In connection with amending the facility, we repaid a $140 million term loan that otherwise matured in 2017 and was secured by mortgages on three hotels, including one hotel that is part of the security for the amended facility. |
• | Hotel operating revenue decreased $9.0 million, inclusive of a $22.2 million reduction in revenue for hotels that have been disposed of, classified as held for sale or recently opened. Excluding these hotels, hotel operating revenue increased 6.7% from last year. The increase was driven by a 7.0% increase in same-store RevPAR, reflecting a 6.2% increase in ADR and a slight increase in occupancy. RevPAR for our Wyndham portfolio increased 13.0%, driven by a 12.2% increase in ADR and a slight increase in occupancy, which primarily reflects repositioning these hotels to upper-upscale. |
• | Hotel departmental expenses decreased $4.2 million, inclusive of a $6.5 million reduction in expense for hotels that have been disposed of, are classified as held for sale or recently opened. Excluding these hotels, hotel departmental expenses decreased to 34.5% of hotel operating revenue in the current period from 35.6% last year. This reduction primarily reflects improved profitability margins for the rooms department, driven by increased ADR. |
• | Other property-related costs decreased $3.5 million, inclusive of a $7.3 million reduction in expense for hotels that have been disposed of, are classified as held for sale or recently opened. Excluding these hotels, other property-related costs increased slightly to 24.8% of hotel operating revenue in the current period from 24.6% last year, primarily reflecting higher marketing costs. |
• | Management and franchise fees decreased $494,000, inclusive of a $1.2 million reduction in expense for hotels that have been disposed of, are classified as held for sale or recently opened. Excluding these hotels, these costs remained flat as a percentage of hotel operating revenue compared to last year. |
• | Taxes, insurance and lease expense decreased $6.3 million and decreased to 5.7% of hotel operating revenue in the current period as compared to 8.2% for last year. The decline primarily |
• | Corporate expenses decreased $1.8 million and decreased to 2.1% of hotel operating revenue for the current period as compared to 2.8% for last year. This decline primarily reflects the change in stock compensation expense associated with variable stock awards (triggered by an increase in our stock price during the three months ended September 30, 2014 as compared to a decrease in our stock price during the three months ended September 30, 2015) and a decrease in corporate bonus expense. |
• | Depreciation and amortization expense increased $465,000, primarily attributable to depreciation recognized on The Knickerbocker, which opened in February 2015, partially offset by a decrease related to the sale of hotels. |
• | Impairment loss for 2015 was $20.9 million resulting from a reduced estimated hold period for one hotel. |
• | Other expenses decreased $3.9 million from the same period last year. This decrease is primarily attributable to a $5.9 million charge for a commercial dispute contingency recognized in 2014, and lower pre-opening costs incurred for The Knickerbocker in the current period as compared to the same period in 2014 (resulting from the opening of the hotel in February 2015), partially offset by $3.6 million in severance charges for certain FelCor officers recognized in the current period (compared to $426,000 last year related to hotel-level employees). |
• | Net interest expense decreased $2.3 million, primarily reflecting lower outstanding debt and a lower blended interest rate for the period, partially offset by lower capitalized interest as we complete certain renovation and redevelopment projects, including The Knickerbocker. |
• | Debt extinguishment. In 2014, we recorded $4.7 million in debt extinguishment charges related to repaying the remaining $234.0 million of our 10% senior secured notes, which were due in 2014, and repaying a $9.6 million loan in connection with the sale of a hotel. |
• | Equity in income from unconsolidated entities decreased $1.0 million. The decrease is primarily due to the unwinding of our 10-hotel unconsolidated joint ventures in July 2014 and a decline in operations at one of our remaining unconsolidated joint ventures resulting from renovation related displacement. |
• | Income tax expense increased approximately $1.0 million primarily due to changes in state apportionment factors, resulting from hotel asset sales, and full utilization of state net operating loss carryforwards. |
• | Hotel operating revenue decreased $38.9 million, inclusive of a $90.2 million reduction in revenue for hotels that have been disposed of, classified as held for sale or recently opened. Excluding these hotels, hotel operating revenue increased 8.9% from last year. The increase was driven by a 9.0% increase in same-store RevPAR, reflecting a 6.4% increase in ADR and a 2.5% increase in occupancy. RevPAR for our Wyndham portfolio increased 17.0%, driven by an 11.7% increase in ADR and a 4.7% increase in occupancy which primarily reflects repositioning these hotels to upper-upscale. |
• | Other revenue increased $4.0 million, which primarily reflects a favorable $3.7 million net settlement of a commercial dispute. |
• | Hotel departmental expenses decreased $19.7 million, inclusive of a $28.7 million reduction in expense for hotels that have been disposed of, are classified as held for sale or recently opened. Excluding these hotels, hotel departmental expenses decreased to 34.8% of hotel operating revenue in the current period from 36.3% last year. This reduction primarily reflects improved profitability margins for the rooms department, driven by increased ADR. Additionally, we experienced an increase in banquet and catering operations compared to the prior year, which typically have higher margins than other food and beverage operations. |
• | Other property-related costs decreased $13.4 million, inclusive of a $25.3 million reduction in expense for hotels that have been disposed of, are classified as held for sale or recently opened. Excluding these hotels, other property-related costs decreased slightly as a percentage of hotel operating revenue to 24.8% in the current period from 24.9% last year, primarily driven by ADR growth. |
• | Management and franchise fees decreased $1.4 million, inclusive of a $4.2 million reduction in expense for hotels that have been disposed of, are classified as held for sale or recently opened. Excluding these hotels, these costs increased slightly to 4.0% of hotel operating revenue in the current period from 3.9% last year. |
• | Taxes, insurance and lease expense decreased $25.3 million and decreased to 6.5% of hotel operating revenue in the current period as compared to 9.7% for last year. The decline primarily reflects $23.3 million lower hotel lease expense resulting from unwinding our 10-hotel unconsolidated joint ventures and the sale of one hotel owned by an unconsolidated joint venture in the second quarter of 2015. Historically, we recorded hotel lease expense for 12 consolidated operating lessees and the corresponding lease income was recorded in equity in income from unconsolidated entities, with the hotel lease expense not eliminated in consolidation. We unwound the joint ventures in July 2014, and, as a result, we recorded lower percentage lease expense for the current period. The decrease in the current period also reflects a net reduction in property tax expense resulting from the successful resolution of property tax appeals, partially offset by an increase in assessed property values, and a decline in insurance expense due to more |
• | Corporate expenses decreased $2.1 million and decreased slightly as a percentage of hotel operating revenue from 3.1% to 2.9%. This decline primarily reflects the change in stock compensation expense associated with variable stock awards (triggered by an increase in our stock price during the nine months ended September 30, 2014 compared to a decrease in our stock price during the nine months ended September 30, 2015) and a decrease in corporate bonus expense. |
• | Depreciation and amortization expense decreased $1.7 million primarily attributable to the sale of hotels, partially offset by depreciation recognized on The Knickerbocker. |
• | Impairment loss for 2015 was $20.9 million resulting from a reduced estimated hold period for one hotel. |
• | Other expenses decreased $2.4 million from the same period last year. This change from last year is primarily attributable to a $5.9 million charge for a commercial dispute contingency recognized in 2014, partially offset by $3.6 million in severance charges for certain FelCor officers recognized in the current period (compared to $827,000 last year related to hotel-level employees) and increased pre-opening costs incurred for The Knickerbocker in 2015, in conjunction with the February 2015 opening. |
• | Net interest expense decreased $12.3 million, primarily reflecting lower outstanding debt and a lower blended interest rate for the period, offset by lower capitalized interest as we completed certain renovation and redevelopment projects, including The Knickerbocker. |
• | Debt extinguishment. In the current period, we recorded $30.9 million in debt extinguishment charges (which includes a $10.5 million write-off of deferred loan costs), primarily related to redeeming our 6.75% senior secured notes due 2019. In 2014, we recorded $4.8 million in debt extinguishment charges related to repaying the remaining $234.0 million of our 10% senior secured notes, which were due in 2014, and repaying a $9.6 million loan in connection with the sale of a hotel. |
• | Equity in income from unconsolidated entities increased $3.2 million. In the current period, one of our unconsolidated joint ventures sold a hotel, which increased our equity in income from unconsolidated entities by $7.1 million from the gain on sale. That increase was offset by lower income after we unwound our 10-hotel unconsolidated joint ventures in July 2014 and a decline in operations at one of our remaining unconsolidated joint ventures, resulting from renovation related displacement. |
• | Income tax expense increased $912,000 primarily due to changes in state apportionment factors, resulting from hotel asset sales, and full utilization of state net operating loss carryforwards. |
Three Months Ended September 30, | |||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||
Dollars | Shares | Per Share Amount | Dollars | Shares | Per Share Amount | ||||||||||||||||
Net income (loss) | $ | (8,133 | ) | $ | 73,570 | ||||||||||||||||
Noncontrolling interests | 288 | (831 | ) | ||||||||||||||||||
Preferred dividends | (6,279 | ) | (9,678 | ) | |||||||||||||||||
Preferred distributions - consolidated joint venture | (363 | ) | (348 | ) | |||||||||||||||||
Net income (loss) attributable to FelCor common stockholders | (14,487 | ) | 62,713 | ||||||||||||||||||
Less: Dividends declared on unvested restricted stock | (13 | ) | (2 | ) | |||||||||||||||||
Less: Undistributed earnings allocated to unvested restricted stock | — | (48 | ) | ||||||||||||||||||
Basic earnings per share data | (14,500 | ) | 142,982 | $ | (0.10 | ) | 62,663 | 124,168 | $ | 0.50 | |||||||||||
Restricted stock units | — | — | — | — | 1,358 | — | |||||||||||||||
Diluted earnings per share data | (14,500 | ) | 142,982 | (0.10 | ) | 62,663 | 125,526 | 0.50 | |||||||||||||
Depreciation and amortization | 28,988 | — | 0.21 | 28,523 | — | 0.23 | |||||||||||||||
Depreciation, unconsolidated entities and other partnerships | 471 | — | — | 1,021 | — | 0.01 | |||||||||||||||
Gain on sale of investment in unconsolidated entities, net | — | — | — | (30,184 | ) | — | (0.24 | ) | |||||||||||||
Gain from remeasurement of unconsolidated entities, net | — | — | — | (20,733 | ) | — | (0.17 | ) | |||||||||||||
Impairment loss | 20,861 | — | 0.15 | — | — | — | |||||||||||||||
Gain on sale of hotels, net of noncontrolling interests in other partnerships | (3,682 | ) | — | (0.03 | ) | (28,410 | ) | — | (0.23 | ) | |||||||||||
Noncontrolling interests in FelCor LP | (61 | ) | 611 | (0.01 | ) | 185 | 613 | — | |||||||||||||
Dividends declared on unvested restricted stock | 13 | — | — | 2 | — | — | |||||||||||||||
Undistributed earnings allocated to unvested restricted stock | — | — | — | 48 | — | — | |||||||||||||||
Conversion of unvested restricted stock and units | — | 1,205 | — | — | 26 | — | |||||||||||||||
FFO | 32,090 | 144,798 | 0.22 | 13,115 | 126,165 | 0.10 | |||||||||||||||
Debt extinguishment | 14 | — | — | 4,566 | — | 0.04 | |||||||||||||||
Debt extinguishment, unconsolidated entities | — | — | — | 155 | — | — | |||||||||||||||
Contract dispute contingency | — | — | — | 5,850 | — | 0.05 | |||||||||||||||
Severance costs | 3,624 | — | 0.03 | 426 | — | — | |||||||||||||||
Variable stock compensation | (1,086 | ) | — | (0.01 | ) | 201 | — | — | |||||||||||||
Pre-opening costs, net of noncontrolling interests | 1,079 | — | 0.01 | 2,346 | — | 0.02 | |||||||||||||||
Adjusted FFO | $ | 35,721 | 144,798 | $ | 0.25 | $ | 26,659 | 126,165 | $ | 0.21 |
Nine Months Ended September 30, | |||||||||||||||||||||
2015 | 2014 | ||||||||||||||||||||
Dollars | Shares | Per Share Amount | Dollars | Shares | Per Share Amount | ||||||||||||||||
Net income | $ | 616 | $ | 83,689 | |||||||||||||||||
Noncontrolling interests | (4,255 | ) | (965 | ) | |||||||||||||||||
Preferred distributions - consolidated joint venture | (1,070 | ) | (870 | ) | |||||||||||||||||
Redemption of preferred stock | (6,096 | ) | — | ||||||||||||||||||
Preferred dividends | (23,860 | ) | (29,034 | ) | |||||||||||||||||
Net income (loss) attributable to FelCor common stockholders | (34,665 | ) | 52,820 | ||||||||||||||||||
Less: Dividends declared on unvested restricted stock | (40 | ) | (5 | ) | |||||||||||||||||
Less: Undistributed earnings allocated to unvested restricted stock | — | (18 | ) | ||||||||||||||||||
Basic earnings per share data | (34,705 | ) | 136,009 | $ | (0.26 | ) | 52,797 | 124,159 | $ | 0.43 | |||||||||||
Restricted stock units | — | — | — | — | 1,130 | (0.01 | ) | ||||||||||||||
Diluted earnings per share data | (34,705 | ) | 136,009 | (0.26 | ) | 52,797 | 125,289 | 0.42 | |||||||||||||
Depreciation and amortization | 85,510 | — | 0.63 | 87,206 | — | 0.70 | |||||||||||||||
Depreciation, discontinued operations and unconsolidated entities | 1,730 | — | 0.01 | 6,395 | — | 0.05 | |||||||||||||||
Gain on sale of investment in unconsolidated entities, net | — | — | — | (30,184 | ) | — | (0.24 | ) | |||||||||||||
Gain from remeasurement of unconsolidated entities, net | — | — | — | (20,733 | ) | — | (0.17 | ) | |||||||||||||
Impairment loss | 20,861 | — | 0.15 | — | — | — | |||||||||||||||
Gain on sale of hotel in unconsolidated entity | (7,113 | ) | — | (0.05 | ) | — | — | — | |||||||||||||
Gain on sale of hotels, net of noncontrolling interests in other partnerships | (14,931 | ) | — | (0.11 | ) | (49,771 | ) | — | (0.40 | ) | |||||||||||
Other gains, net | (100 | ) | — | — | (100 | ) | — | — | |||||||||||||
Noncontrolling interests in FelCor LP | (150 | ) | 611 | — | 135 | 615 | — | ||||||||||||||
Dividends declared on unvested restricted stock | 40 | — | — | 5 | — | — | |||||||||||||||
Conversion of unvested restricted stock and units | — | 1,173 | — | 18 | 12 | — | |||||||||||||||
FFO | 51,142 | 137,793 | 0.37 | 45,768 | 125,916 | 0.36 | |||||||||||||||
Debt extinguishment, including discontinued operations, net of noncontrolling interests | 30,909 | — | 0.22 | 4,843 | — | 0.04 | |||||||||||||||
Debt extinguishment, unconsolidated entities | 330 | — | — | 155 | — | — | |||||||||||||||
Contract dispute contingency | — | — | — | 5,850 | — | 0.05 | |||||||||||||||
Severance costs | 3,624 | — | 0.03 | 829 | — | 0.01 | |||||||||||||||
Variable stock compensation | (161 | ) | — | — | 1,620 | — | 0.01 | ||||||||||||||
Redemption of preferred stock | 6,096 | — | 0.04 | — | — | — | |||||||||||||||
Contract dispute recovery | (3,717 | ) | — | (0.03 | ) | — | — | — | |||||||||||||
Pre-opening costs, net of noncontrolling interests | 5,125 | — | 0.05 | 4,605 | — | 0.04 | |||||||||||||||
Adjusted FFO | $ | 93,348 | 137,793 | $ | 0.68 | $ | 63,670 | 125,916 | $ | 0.51 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Net income (loss) | $ | (8,133 | ) | $ | 73,570 | $ | 616 | $ | 83,689 | ||||||
Depreciation and amortization | 28,988 | 28,523 | 85,510 | 87,206 | |||||||||||
Depreciation, unconsolidated entities and other partnerships | 471 | 1,021 | 1,730 | 6,395 | |||||||||||
Interest expense | 19,608 | 21,935 | 59,379 | 71,685 | |||||||||||
Interest expense, discontinued operations and unconsolidated entities | 96 | 290 | 439 | 1,681 | |||||||||||
Income taxes | 1,392 | — | 1,392 | — | |||||||||||
Noncontrolling interests in other partnerships | 227 | (646 | ) | (4,405 | ) | (830 | ) | ||||||||
EBITDA | 42,649 | 124,693 | 144,661 | 249,826 | |||||||||||
Impairment loss | 20,861 | — | 20,861 | — | |||||||||||
Debt extinguishment, including discontinued operations, net of noncontrolling interests | 14 | 4,566 | 30,909 | 4,843 | |||||||||||
Debt extinguishment, unconsolidated entities | — | 155 | 330 | 155 | |||||||||||
Gain on sale of hotel in unconsolidated entity | — | — | (7,113 | ) | — | ||||||||||
Gain on sale of hotels, net of noncontrolling interests in other partnerships | (3,682 | ) | (28,410 | ) | (14,931 | ) | (49,771 | ) | |||||||
Other gains, net | — | — | (100 | ) | (100 | ) | |||||||||
Gain on sale of investment in unconsolidated entities, net | — | (30,184 | ) | — | (30,184 | ) | |||||||||
Gain from remeasurement of unconsolidated entities, net | — | (20,733 | ) | — | (20,733 | ) | |||||||||
Contract dispute contingency | — | 5,850 | — | 5,850 | |||||||||||
Amortization of fixed stock and directors’ compensation | 1,652 | 2,198 | 5,214 | 4,490 | |||||||||||
Severance costs | 3,624 | 426 | 3,624 | 829 | |||||||||||
Variable stock compensation | (1,086 | ) | 201 | (161 | ) | 1,620 | |||||||||
Contract dispute recovery | — | — | (3,717 | ) | — | ||||||||||
Pre-opening costs, net of noncontrolling interests | 1,079 | 2,346 | 5,125 | 4,605 | |||||||||||
Adjusted EBITDA | 65,111 | 61,108 | 184,702 | 171,430 | |||||||||||
Adjusted EBITDA from hotels disposed, held for sale or recently opened | (1,604 | ) | (5,820 | ) | (6,867 | ) | (22,424 | ) | |||||||
Same-store Adjusted EBITDA | $ | 63,507 | $ | 55,288 | $ | 177,835 | $ | 149,006 |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Same-store operating revenue: | |||||||||||||||
Room | $ | 168,862 | $ | 157,888 | $ | 482,670 | $ | 442,871 | |||||||
Food and beverage | 32,281 | 30,419 | 110,534 | 100,966 | |||||||||||
Other operating departments | 11,628 | 11,190 | 33,848 | 31,995 | |||||||||||
Same-store operating revenue(a) | 212,771 | 199,497 | 627,052 | 575,832 | |||||||||||
Same-store operating expense: | |||||||||||||||
Room | 41,821 | 40,378 | 120,030 | 114,918 | |||||||||||
Food and beverage | 26,977 | 25,507 | 85,075 | 79,004 | |||||||||||
Other operating departments | 4,536 | 5,152 | 13,005 | 15,120 | |||||||||||
Other property related costs | 52,794 | 49,030 | 155,368 | 143,380 | |||||||||||
Management and franchise fees | 8,800 | 8,108 | 25,340 | 22,494 | |||||||||||
Taxes, insurance and lease expense | 10,904 | 13,057 | 37,155 | 38,232 | |||||||||||
Same-store operating expense(a) | 145,832 | 141,232 | 435,973 | 413,148 | |||||||||||
Hotel EBITDA | $ | 66,939 | $ | 58,265 | $ | 191,079 | $ | 162,684 | |||||||
Hotel EBITDA Margin | 31.5 | % | 29.2 | % | 30.5 | % | 28.3 | % |
(a) | Excludes The Knickerbocker, which opened in February 2015. |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Same-store operating revenue | $ | 212,771 | $ | 199,497 | $ | 627,052 | $ | 575,832 | |||||||
Other revenue | 1,678 | 1,607 | 7,142 | 3,170 | |||||||||||
Revenue from hotels disposed, held for sale and recently opened(a) | 10,703 | 32,952 | 45,756 | 135,918 | |||||||||||
Total revenue | 225,152 | 234,056 | 679,950 | 714,920 | |||||||||||
Same-store operating expense | 145,832 | 141,232 | 435,973 | 413,148 | |||||||||||
Consolidated hotel lease expense(b) | 1,524 | 5,537 | 5,762 | 29,224 | |||||||||||
Unconsolidated taxes, insurance and lease expense | (168 | ) | (994 | ) | (1,681 | ) | (5,347 | ) | |||||||
Corporate expenses | 4,672 | 6,442 | 19,775 | 21,914 | |||||||||||
Depreciation and amortization | 28,988 | 28,523 | 85,510 | 87,206 | |||||||||||
Impairment loss | 20,861 | — | 20,861 | — | |||||||||||
Expenses from hotels disposed, held for sale and recently opened(a) | 9,073 | 25,082 | 38,085 | 100,869 | |||||||||||
Other expenses | 5,807 | 9,746 | 11,446 | 13,874 | |||||||||||
Total operating expense | 216,589 | 215,568 | 615,731 | 660,888 | |||||||||||
Operating income | $ | 8,563 | $ | 18,488 | $ | 64,219 | $ | 54,032 |
(a) | Under GAAP, we include the operating performance for disposed, held for sale and recently opened hotels in continuing operations in our Consolidated Statements of Operations. However, for purposes of our Non-GAAP reporting metrics, we have excluded the results of these hotels to provide a meaningful same-store comparison. |
(b) | Consolidated hotel lease expense represents the percentage lease expense of our 51% owned operating lessees. The offsetting percentage lease revenue is included in equity in income from unconsolidated entities. |
• | Gains and losses related to extinguishment of debt and interest rate swaps - We exclude gains and losses related to extinguishment of debt and interest rate swaps from FFO and EBITDA because we believe that it is not indicative of ongoing operating performance of our hotel assets. This also represents an acceleration of interest expense or a reduction of interest expense, and interest expense is excluded from EBITDA. |
• | Cumulative effect of a change in accounting principle - Infrequently, the Financial Accounting Standards Board promulgates new accounting standards that require the consolidated statements of operations to reflect the cumulative effect of a change in accounting principle. We exclude these one-time adjustments in computing Adjusted FFO and Adjusted EBITDA because they do not reflect our actual performance for that period. |
• | Other transaction costs - From time to time, we periodically incur costs that are not indicative of ongoing operating performance. Such costs include, but are not limited to, conversion costs, acquisition costs, pre-opening costs and severance costs. We exclude these costs from the calculation of Adjusted FFO and Adjusted EBITDA. |
• | Variable stock compensation - We exclude the cost associated with our variable stock compensation. This cost is subject to volatility related to the price and dividends of our common stock that does not necessarily correspond to our operating performance. |
Hotels | Room Count at September 30, 2015 | ||||||
Consolidated Hotels(a) | 40 | 12,272 | |||||
Unconsolidated hotel operations | 1 | 171 | |||||
Total hotels | 41 | 12,443 | |||||
50% joint ventures | 2 | (216 | ) | ||||
95% joint venture | 1 | (17 | ) | ||||
Pro rata rooms attributed to joint venture partners | (233 | ) | |||||
Pro rata share of rooms owned | 12,210 |
Year Ended December 31, 2014 | ||||||||||||||||||
Brand | Hotels | Rooms | Hotel Operating Revenue (in thousands) | Hotel EBITDA (in thousands)(a) | ||||||||||||||
Embassy Suites Hotels | 18 | 4,982 | $ | 282,866 | $ | 94,990 | ||||||||||||
Wyndham and Wyndham Grand | 8 | 2,528 | 125,354 | 43,122 | ||||||||||||||
Renaissance and Marriott | 3 | 1,321 | 128,770 | 26,086 | ||||||||||||||
DoubleTree by Hilton and Hilton | 3 | 802 | 45,383 | 15,483 | ||||||||||||||
Sheraton | 2 | 673 | 39,639 | 10,622 | ||||||||||||||
Fairmont | 1 | 383 | 53,451 | 10,010 | ||||||||||||||
Holiday Inn | 2 | 968 | 51,511 | 8,966 | ||||||||||||||
Morgans and Royalton | 2 | 285 | 33,895 | 3,314 | ||||||||||||||
Same-store hotels(b) | 39 | 11,942 | $ | 760,869 | $ | 212,593 | ||||||||||||
Market | ||||||||||||||||||
San Francisco area | 5 | 1,903 | $ | 139,692 | $ | 39,466 | ||||||||||||
Boston | 3 | 916 | 85,670 | 21,832 | ||||||||||||||
South Florida | 3 | 923 | 55,561 | 17,007 | ||||||||||||||
Los Angeles | 2 | 481 | 28,696 | 12,404 | ||||||||||||||
Myrtle Beach | 2 | 640 | 41,149 | 12,218 | ||||||||||||||
Philadelphia | 2 | 728 | 38,680 | 9,630 | ||||||||||||||
Tampa | 1 | 361 | 49,358 | 9,301 | ||||||||||||||
New York area | 3 | 546 | 48,456 | 7,259 | ||||||||||||||
Other markets | 18 | 5,444 | 273,607 | 83,476 | ||||||||||||||
Same-store hotels(b) | 39 | 11,942 | $ | 760,869 | $ | 212,593 | ||||||||||||
Location | ||||||||||||||||||
Urban | 17 | 5,310 | $ | 360,177 | $ | 97,584 | ||||||||||||
Resort | 9 | 2,733 | 203,370 | 51,679 | ||||||||||||||
Airport | 8 | 2,621 | 136,144 | 43,204 | ||||||||||||||
Suburban | 5 | 1,278 | 61,178 | 20,126 | ||||||||||||||
Same-store hotels(b) | 39 | 11,942 | $ | 760,869 | $ | 212,593 |
(a) | Hotel EBITDA is a non-GAAP financial measure. A detailed reconciliation and further discussion of Hotel EBITDA is contained in the “Non-GAAP Financial Measures” section of this Management’s Discussion and Analysis of Financial Condition and Results of Operations. We consider Hotel Operating Revenue and Hotel EBITDA to be same-store metrics for this presentation and hotels disposed or held for sale are excluded. |
(b) | Excludes The Knickerbocker, which opened in February 2015. |
Occupancy (%) | |||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||
2015 | 2014 | %Variance | 2015 | 2014 | %Variance | ||||||||||||||
Embassy Suites Hotels | 82.9 | 81.5 | 1.7 | 82.4 | 80.0 | 3.0 | |||||||||||||
Wyndham and Wyndham Grand | 79.4 | 78.9 | 0.7 | 76.5 | 73.1 | 4.7 | |||||||||||||
Renaissance and Marriott | 68.7 | 70.0 | (1.9 | ) | 73.8 | 74.0 | (0.3 | ) | |||||||||||
DoubleTree by Hilton and Hilton | 85.0 | 81.9 | 3.8 | 78.9 | 76.4 | 3.2 | |||||||||||||
Sheraton | 77.1 | 79.1 | (2.4 | ) | 71.2 | 70.4 | 1.1 | ||||||||||||
Fairmont | 86.7 | 85.0 | 2.1 | 77.6 | 75.9 | 2.3 | |||||||||||||
Holiday Inn | 84.6 | 86.5 | (2.2 | ) | 78.9 | 78.8 | 0.2 | ||||||||||||
Morgans and Royalton | 89.5 | 89.8 | (0.4 | ) | 83.8 | 86.8 | (3.4 | ) | |||||||||||
Same-store hotels (39)(a) | 80.8 | 80.3 | 0.7 | 78.9 | 77.0 | 2.5 | |||||||||||||
ADR ($) | |||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||
2015 | 2014 | %Variance | 2015 | 2014 | %Variance | ||||||||||||||
Embassy Suites Hotels | 177.63 | 167.65 | 6.0 | 176.27 | 165.46 | 6.5 | |||||||||||||
Wyndham and Wyndham Grand | 179.78 | 160.19 | 12.2 | 175.91 | 157.44 | 11.7 | |||||||||||||
Renaissance and Marriott | 217.22 | 207.35 | 4.8 | 235.17 | 224.11 | 4.9 | |||||||||||||
DoubleTree by Hilton and Hilton | 162.11 | 155.89 | 4.0 | 162.91 | 157.57 | 3.4 | |||||||||||||
Sheraton | 151.89 | 153.46 | (1.0 | ) | 147.80 | 146.57 | 0.8 | ||||||||||||
Fairmont | 337.92 | 319.97 | 5.6 | 323.51 | 303.03 | 6.8 | |||||||||||||
Holiday Inn | 205.51 | 192.61 | 6.7 | 180.62 | 164.50 | 9.8 | |||||||||||||
Morgans and Royalton | 290.70 | 294.02 | (1.1 | ) | 281.49 | 296.60 | (5.1 | ) | |||||||||||
Same-store hotels (39)(a) | 190.19 | 179.06 | 6.2 | 187.60 | 176.37 | 6.4 | |||||||||||||
RevPAR ($) | |||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||
2015 | 2014 | %Variance | 2015 | 2014 | %Variance | ||||||||||||||
Embassy Suites Hotels | 147.22 | 136.57 | 7.8 | 145.18 | 132.36 | 9.7 | |||||||||||||
Wyndham and Wyndham Grand | 142.70 | 126.31 | 13.0 | 134.62 | 115.10 | 17.0 | |||||||||||||
Renaissance and Marriott | 149.30 | 145.21 | 2.8 | 173.45 | 165.75 | 4.6 | |||||||||||||
DoubleTree by Hilton and Hilton | 137.82 | 127.71 | 7.9 | 128.53 | 120.46 | 6.7 | |||||||||||||
Sheraton | 117.15 | 121.31 | (3.4 | ) | 105.22 | 103.23 | 1.9 | ||||||||||||
Fairmont | 293.13 | 271.87 | 7.8 | 251.11 | 230.03 | 9.2 | |||||||||||||
Holiday Inn | 173.83 | 166.52 | 4.4 | 142.57 | 129.55 | 10.1 | |||||||||||||
Morgans and Royalton | 260.12 | 264.03 | (1.5 | ) | 235.84 | 257.33 | (8.4 | ) | |||||||||||
Same-store hotels (39)(a) | 153.70 | 143.71 | 7.0 | 148.05 | 135.85 | 9.0 |
(a) | Excludes The Knickerbocker, which opened in February 2015. |
Occupancy (%) | |||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2015 | 2014 | %Variance | 2015 | 2014 | %Variance | ||||||||||||||||||
San Francisco area | 90.7 | 90.4 | 0.3 | 87.3 | 82.6 | 5.7 | |||||||||||||||||
Boston | 86.4 | 86.1 | 0.4 | 78.8 | 77.7 | 1.5 | |||||||||||||||||
South Florida | 79.3 | 76.4 | 3.8 | 85.4 | 84.1 | 1.6 | |||||||||||||||||
Los Angeles area | 85.9 | 86.0 | (0.1 | ) | 83.7 | 84.6 | (1.1 | ) | |||||||||||||||
Myrtle Beach | 87.8 | 87.9 | (0.2 | ) | 73.3 | 70.8 | 3.5 | ||||||||||||||||
Philadelphia | 73.2 | 77.2 | (5.1 | ) | 66.8 | 69.9 | (4.4 | ) | |||||||||||||||
Tampa | 77.3 | 74.2 | 4.2 | 83.4 | 81.7 | 2.1 | |||||||||||||||||
New York area | 85.4 | 86.9 | (1.7 | ) | 80.2 | 82.2 | (2.4 | ) | |||||||||||||||
Other markets | 76.2 | 75.1 | 1.4 | 76.3 | 74.0 | 3.2 | |||||||||||||||||
Same-store hotels (39)(a) | 80.8 | 80.3 | 0.7 | 78.9 | 77.0 | 2.5 | |||||||||||||||||
ADR ($) | |||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2015 | 2014 | %Variance | 2015 | 2014 | %Variance | ||||||||||||||||||
San Francisco area | 249.58 | 235.29 | 6.1 | 225.67 | 210.81 | 7.0 | |||||||||||||||||
Boston | 275.74 | 254.94 | 8.2 | 256.50 | 235.23 | 9.0 | |||||||||||||||||
South Florida | 130.71 | 123.87 | 5.5 | 170.85 | 161.23 | 6.0 | |||||||||||||||||
Los Angeles area | 212.65 | 191.06 | 11.3 | 190.69 | 174.46 | 9.3 | |||||||||||||||||
Myrtle Beach | 191.85 | 185.24 | 3.6 | 165.58 | 163.72 | 1.1 | |||||||||||||||||
Philadelphia | 166.50 | 143.71 | 15.9 | 167.00 | 143.55 | 16.3 | |||||||||||||||||
Tampa | 173.53 | 167.93 | 3.3 | 213.32 | 197.24 | 8.2 | |||||||||||||||||
New York area | 242.71 | 243.04 | (0.1 | ) | 237.74 | 246.95 | (3.7 | ) | |||||||||||||||
Other markets | 155.47 | 146.42 | 6.2 | 161.05 | 151.82 | 6.1 | |||||||||||||||||
Same-store hotels (39)(a) | 190.19 | 179.06 | 6.2 | 187.60 | 176.37 | 6.4 | |||||||||||||||||
RevPAR ($) | |||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||
2015 | 2014 | %Variance | 2015 | 2014 | %Variance | ||||||||||||||||||
San Francisco area | 226.30 | 212.62 | 6.4 | 196.94 | 174.03 | 13.2 | |||||||||||||||||
Boston | 238.17 | 219.42 | 8.5 | 202.09 | 182.66 | 10.6 | |||||||||||||||||
South Florida | 103.68 | 94.67 | 9.5 | 145.95 | 135.60 | 7.6 | |||||||||||||||||
Los Angeles area | 182.71 | 164.31 | 11.2 | 159.70 | 147.66 | 8.2 | |||||||||||||||||
Myrtle Beach | 168.42 | 162.89 | 3.4 | 121.32 | 115.85 | 4.7 | |||||||||||||||||
Philadelphia | 121.91 | 110.90 | 9.9 | 111.57 | 100.34 | 11.2 | |||||||||||||||||
Tampa | 134.20 | 124.61 | 7.7 | 177.95 | 161.08 | 10.5 | |||||||||||||||||
New York area | 207.29 | 211.13 | (1.8 | ) | 190.71 | 203.05 | (6.1 | ) | |||||||||||||||
Other markets | 118.46 | 110.01 | 7.7 | 122.95 | 112.30 | 9.5 | |||||||||||||||||
Same-store hotels (39)(a) | 153.70 | 143.71 | 7.0 | 148.05 | 135.85 | 9.0 |
(a) | Excludes The Knickerbocker, which opened in February 2015. |
Consolidated Hotels | State | Rooms | % Owned(a) | |||
Embassy Suites Birmingham | AL | 242 | ||||
Embassy Suites Phoenix-Biltmore | AZ | 232 | ||||
Renaissance Esmeralda Indian Wells Resort & Spa | CA | 560 | ||||
Embassy Suites Los Angeles-International Airport/South | CA | 349 | ||||
Embassy Suites Mandalay Beach-Hotel & Resort | CA | 250 | ||||
Embassy Suites Milpitas-Silicon Valley | CA | 266 | ||||
Embassy Suites Napa Valley | CA | 205 | ||||
Wyndham San Diego Bayside | CA | 600 | ||||
Embassy Suites San Francisco Airport-Waterfront | CA | 340 | ||||
Embassy Suites San Francisco Airport-South San Francisco | CA | 312 | ||||
Holiday Inn San Francisco-Fisherman’s Wharf | CA | 585 | ||||
San Francisco Marriott Union Square | CA | 400 | ||||
Wyndham Santa Monica At the Pier | CA | 132 | ||||
Embassy Suites Deerfield Beach-Resort & Spa | FL | 244 | ||||
Embassy Suites Fort Lauderdale-17th Street | FL | 361 | ||||
Embassy Suites Miami-International Airport | FL | 318 | ||||
DoubleTree Suites by Hilton Orlando-Lake Buena Vista | FL | 229 | ||||
Embassy Suites Orlando-International Drive South/Convention Center | FL | 244 | ||||
The Vinoy Renaissance St. Petersburg Resort & Golf Club | FL | 361 | ||||
Embassy Suites Atlanta-Buckhead | GA | 316 | ||||
Wyndham New Orleans-French Quarter | LA | 374 | ||||
The Fairmont Copley Plaza, Boston | MA | 383 | ||||
Wyndham Boston Beacon Hill | MA | 304 | ||||
Embassy Suites Boston-Marlborough | MA | 229 | ||||
Embassy Suites Minneapolis-Airport | MN | 310 | ||||
Embassy Suites Secaucus-Meadowlands | NJ | 261 | 50 | % | ||
The Knickerbocker | NY | 330 | 95 | % | ||
Morgans New York | NY | 117 | ||||
Royalton New York | NY | 168 | ||||
Sheraton Philadelphia Society Hill Hotel | PA | 364 | ||||
Wyndham Philadelphia Historic District | PA | 364 | ||||
Wyndham Pittsburgh University Center | PA | 251 | ||||
The Mills House Wyndham Grand Hotel, Charleston | SC | 216 | ||||
Embassy Suites Myrtle Beach-Oceanfront Resort | SC | 255 | ||||
Hilton Myrtle Beach Resort | SC | 385 | ||||
Holiday Inn Nashville Airport | TN | 383 | ||||
DoubleTree Suites by Hilton Austin | TX | 188 | ||||
Embassy Suites Dallas-Love Field | TX | 248 | ||||
Wyndham Houston-Medical Center Hotel & Suites | TX | 287 | ||||
Sheraton Burlington Hotel & Conference Center | VT | 309 | ||||
Unconsolidated Hotel | ||||||
Chateau LeMoyne-French Quarter, New Orleans (A Holiday Inn Hotel) | LA | 171 | 50 | % |
(a) | We own 100% of each hotel, except where otherwise noted. |
• | We amended and restated our secured line of credit facility to increase aggregate lender commitments to $400 million from $225 million (which resulted in payment of $5.8 million of related deferred financing fees), as well as extend the facility’s maturity to 2020 (assuming we satisfy certain conditions and exercise a one-year extension option) and reduced the applicable interest rate spread by 62.5 basis points. At September 30, 2015, we had $200 million drawn and outstanding under that facility. |
• | We issued $475 million of our 6.0% senior notes due 2025 (which resulted in payment of $8.5 million of related deferred financing fees) and used all of the net proceeds, together with cash on hand and funds drawn under our line of credit, to repurchase and redeem $525 million (face value) of our outstanding 6.75% senior secured notes due 2019. |
• | We used funds drawn under our line of credit to repay a $140 million secured loan that would have otherwise matured in 2017. |
• | We used asset sale proceeds to repay $62.1 million of other secured debt. |
• | We issued 18.4 million shares of our common stock for net proceeds of approximately $199 million. |
• | We used proceeds from selling shares of our common stock to redeem all of our outstanding shares of 8% Series C Cumulative Preferred Stock for an aggregate redemption price of $170.4 million (including $491,000 of accrued dividends), thereby significantly reducing our recurring preferred dividend expense. |
• | We received $1.7 million of additional net proceeds from The Knickerbocker consolidated joint venture’s sale of preferred equity interests pursuant to the EB-5 Immigrant Investor Program. |
• | We increased our distributions to non-controlling interest holders during the first nine months of 2015 to $16.3 million, primarily due to the sale of a hotel in a consolidated joint venture. |
Item 3. | Quantitative and Qualitative Disclosures about Market Risk. |
Expected Maturity Date | |||||||||||||||||||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | Thereafter | Total | Fair Value | ||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||
Fixed-rate: | |||||||||||||||||||||||||||||||
Debt | $ | 1,277 | $ | 2,652 | $ | 2,810 | $ | 2,954 | $ | 3,106 | $ | 1,140,972 | $ | 1,153,771 | $ | 1,172,802 | |||||||||||||||
Average interest rate | 4.95 | % | 4.95 | % | 4.95 | % | 4.95 | % | 4.95 | % | 5.70 | % | 5.69 | % | |||||||||||||||||
Floating-rate: | |||||||||||||||||||||||||||||||
Debt | — | 64,861 | — | — | 200,000 | — | 264,861 | 265,235 | |||||||||||||||||||||||
Average interest rate (a) | — | 4.35 | % | — | — | 4.51 | % | — | 4.47 | % | |||||||||||||||||||||
Total debt | $ | 1,277 | $ | 67,513 | $ | 2,810 | $ | 2,954 | $ | 203,106 | $ | 1,140,972 | $ | 1,418,632 | |||||||||||||||||
Average interest rate | 4.95 | % | 4.37 | % | 4.95 | % | 4.95 | % | 4.51 | % | 5.70 | % | 5.46 | % | |||||||||||||||||
Net discount | — | ||||||||||||||||||||||||||||||
Total debt | $ | 1,418,632 |
(a) | The average floating interest rate considers the implied forward rates in the yield curve at September 30, 2015. |
Item 4. | Controls and Procedures. |
Item 6. | Exhibits. |
Exhibit Number | Description of Exhibit | |
10.1 | Severance Agreement by and between FelCor Lodging Trust Incorporated and Michael A. DeNicola (filed as Exhibit 10.1 to FelCor’s Form 8-K, dated April 4, 2015). | |
31.1* | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for FelCor. | |
31.2* | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for FelCor. | |
31.3* | Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for FelCor LP. | |
31.4* | Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 for FelCor LP. |
32.1* | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for FelCor. | |
32.2* | Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 for FelCor LP. | |
101.INS | XBRL Instance Document. Submitted electronically with this report. | |
101.SCH | XBRL Taxonomy Extension Schema Document. Submitted electronically with this report. | |
101.CAL | XBRL Taxonomy Calculation Linkbase Document. Submitted electronically with this report. | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document. Submitted electronically with this report. | |
101.LAB | XBRL Taxonomy Label Linkbase Document. Submitted electronically with this report. | |
101.PRE | XBRL Taxonomy Presentation Linkbase Document. Submitted electronically with this report. |
FELCOR LODGING TRUST INCORPORATED | |||
a Maryland Corporation | |||
Date: October 30, 2015 | By: | /s/ Jeffrey D. Symes | |
Name: | Jeffrey D. Symes | ||
Title: | Senior Vice President, Chief Accounting Officer and Controller |
FELCOR LODGING LIMITED PARTNERSHIP | |||
a Delaware limited partnership | |||
By: | FelCor Lodging Trust Incorporated | ||
Its General Partner | |||
Date: October 30, 2015 | By: | /s/ Jeffrey D. Symes | |
Name: | Jeffrey D. Symes | ||
Title: | Senior Vice President, Chief Accounting Officer and Controller |
1. | I have reviewed this Quarterly Report on Form 10-Q of FelCor Lodging Trust Incorporated; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: October 30, 2015 | /s/ Richard A. Smith | |
Richard A. Smith Chief Executive Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of FelCor Lodging Trust Incorporated; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: October 30, 2015 | /s/ Michael C. Hughes | |
Michael C. Hughes Chief Financial Officer |
1. | I have reviewed this Quarterly Report on Form 10-Q of FelCor Lodging Limited Partnership; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: October 30, 2015 | /s/ Richard A. Smith | |
Richard A. Smith Chief Executive Officer of FelCor Lodging Trust Incorporated, as general partner of FelCor Lodging Limited Partnership |
1. | I have reviewed this Quarterly Report on Form 10-Q of FelCor Lodging Limited Partnership; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a) | designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b) | designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c) | evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d) | disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent function): |
a) | all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b) | any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: October 30, 2015 | /s/ Michael C. Hughes | |
Michael C. Hughes Chief Financial Officer of FelCor Lodging Trust Incorporated, as general partner of FelCor Lodging Limited Partnership |
/s/ Richard A. Smith | |
Richard A. Smith | |
Chief Executive Officer | |
/s/ Michael C. Hughes | |
Michael C. Hughes | |
Chief Financial Officer |
/s/ Richard A. Smith | |
Richard A. Smith | |
Chief Executive Officer of FelCor Lodging Trust Incorporated, as general partner of FelCor Lodging Limited Partnership | |
/s/ Michael C. Hughes | |
Michael C. Hughes | |
Chief Financial Officer of FelCor Lodging Trust Incorporated, as general partner of FelCor Lodging Limited Partnership |
Impairment Charges (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2015 |
Sep. 30, 2014 |
Sep. 30, 2015 |
Sep. 30, 2014 |
|
Impairment [Line Items] | ||||
Impairment loss | $ 20,861 | $ 0 | $ 20,861 | $ 0 |
Discounted Cash Flow Approach [Member] | Fair Value, Inputs, Level 3 [Member] | ||||
Impairment [Line Items] | ||||
Fair Value Inputs, Long-term Revenue Growth Rate | 3.00% | |||
Fair Value Assumptions, Expected Term | 5 years | |||
Fair Value Inputs, Terminal Capitalization Rate | 8.00% | |||
Fair Value Inputs, Discount Rate | 11.00% |
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