e8vk

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TEhUGJ3f0oxW0ofzU1tmLAXAmq309PpKFpwHiZP294QZAuujs+Po/oB8GETT/EXF 8nWUPT5n5J10SDuMmz4hbw== 0000950134-05-014747.txt : 20050804 0000950134-05-014747.hdr.sgml : 20050804 20050803200336 ACCESSION NUMBER: 0000950134-05-014747 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20050803 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20050804 DATE AS OF CHANGE: 20050803 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FelCor Lodging Trust Inc CENTRAL INDEX KEY: 0000923603 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 752541756 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-14236 FILM NUMBER: 05997381 BUSINESS ADDRESS: STREET 1: 545 E JOHN CARPENTER FREEWAY STREET 2: SUITE 1300 CITY: IRVING STATE: TX ZIP: 75062 BUSINESS PHONE: 9724444900 MAIL ADDRESS: STREET 1: 545 E JOHN CARPENTER FREEWAY STREET 2: SUITE 1300 CITY: IRVING STATE: TX ZIP: 75062 FORMER COMPANY: FORMER CONFORMED NAME: FELCOR LODGING TRUST INC DATE OF NAME CHANGE: 19980810 FORMER COMPANY: FORMER CONFORMED NAME: FELCOR SUITE HOTELS INC DATE OF NAME CHANGE: 19940523 8-K 1 d27540e8vk.htm FORM 8-K e8vk

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) August 3, 2005

FelCor Lodging Trust Incorporated

(Exact name of registrant as specified in its charter)


Maryland	001-14236	75-2541756

(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)


545 E. John Carpenter Frwy., Suite 1300 Irving, Texas		75062

(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code (972) 444-4900

(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

			o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

			o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

			o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

			o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS


Item 2.02 Results of Operations and Financial Condition
Item 9.01 Financial Statements and Exhibits
SIGNATURES
INDEX TO EXHIBITS
Press Release
Supplemental Information

Section 2 — Financial Information

Item 2.02 Results of Operations and Financial Condition.

On August 3, 2005, FelCor Lodging Trust Incorporated issued a press release announcing its results of operations for the three and six months ended June 30, 2005, and published its Supplemental Information for the three and six months ended June 30, 2005, which provides additional corporate data, financial highlights and portfolio statistical data. Copies of the press release and the Supplemental Information are furnished as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K. Copies of the foregoing are also available on FelCor Lodging Trust Incorporated’s website at www.felcor.com, on its Investor Relations page in the “Financial Reports” section.

The information in this Current Report on Form 8-K, including the exhibits, is provided under Item 2.02 of Form 8-K and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section. Furthermore, the information in this Current Report on Form 8-K, including the exhibits, shall not be deemed to be incorporated by reference into the filings of the registrant under the Securities Act of 1933 regardless of any general incorporation language in such filings.

Section 9 — Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

(a) Financial statements of businesses acquired.

Not applicable.

(b) Pro forma financial information.

Not applicable.

The following exhibits are furnished in accordance with the provisions of Item 601 of Regulation S-K:


Exhibit
Number		Description of Exhibit

99.1		Press release issued by FelCor Lodging Trust Incorporated on August 3, 2005, announcing its results of operations for the three and six months ended June 30, 2005.

99.2		Supplemental Information for the three and six months ended June 30, 2005, published by FelCor Lodging Trust Incorporated on August 3, 2005, providing additional corporate data, financial highlights and portfolio statistical data.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


	FELCOR LODGING TRUST INCORPORATED

Date: August 3, 2005	By:	/s/ Lester C. Johnson

	Name:	Lester C. Johnson
	Title:	Senior Vice President and Controller

INDEX TO EXHIBITS


Exhibit
Number		Description of Exhibit

99.1		Press release issued by FelCor Lodging Trust Incorporated on August 3, 2005, announcing its results of operations for the three and six months ended June 30, 2005.

99.2		Supplemental Information for the three and six months ended June 30, 2005, published by FelCor Lodging Trust Incorporated on August 3, 2005, providing additional corporate data, financial highlights and portfolio statistical data.

EX-99.1 2 d27540exv99w1.htm PRESS RELEASE exv99w1


		FelCor Loadging Trust Incorporated 545 E. John Carpenter Freeway, Suite 1300 Irving, Texas 75062-3933 P 972.444.4900 F 972.444.4949 www.felcor.com NYSE: FCH		Exhibit 99.1

For Immediate Release:

FELCOR EXCEEDS SECOND QUARTER GUIDANCE
• Raises Full Year Outlook

IRVING, Texas...August 3, 2005 - FelCor Lodging Trust Incorporated (NYSE: FCH), one of the nation’s largest hotel real estate investment trusts (REITs), today reported operating results for the second quarter and six months ended June 30, 2005.

Highlights:

Second Quarter Results:

	•		Same-Store EBITDA increased to $80 million in the second quarter of 2005, from $68 million in the same period of 2004, a 17 percent increase. Adjusted EBITDA grew from $73 million in the second quarter of 2004 to $81 million in the second quarter of 2005, and exceeded the high end of our guidance.

	•		Adjusted FFO was $34 million, compared to $22 million for the same period last year. Adjusted FFO per share was $0.54, compared to $0.35 for the same period last year, an increase of 54 percent. Adjusted FFO for the second quarter exceeded our previous guidance of $0.49 to $0.52 per share.

	•		Net loss applicable to common stockholders was $5 million, or a net loss of $0.08 per share, compared to the prior year second quarter net loss of $41 million, or $0.69 per share.

	•		Revenue per available room (“RevPAR”) for the quarter increased 9.6 percent, compared to the same period in 2004, exceeding our second quarter forecast RevPAR growth of between six and seven percent. Average daily rate (“ADR”) made up 59 percent of our RevPAR growth for the quarter.

	•		Hotel operating profit increased to $75 million for the quarter, compared to $66 million in the prior year period, an increase of 14 percent. Hotel operating profit margin during the quarter was 23.1 percent, an increase of 130 basis points over the 21.8 percent margin last year.

Year to Date Results:

	•		Same-Store EBITDA increased to $142 million in the first half of 2005, from $124 million, a 15 percent increase, for the six month period ended June 30, 2004. Adjusted EBITDA grew from $132 million in the first six months of 2004 to $143 million in the first six months of 2005.

	•		Adjusted FFO for the year-to-date period was $50 million, compared to $30 million for the same period last year and Adjusted FFO per share was $0.79 for the current period, compared to $0.49 for the same period last year, an increase of 61 percent.

	•		Net loss applicable to common stockholders was $23 million, or a net loss of $0.38 per share, compared to the prior year six month net loss of $68 million, or $1.15 per share.

	•		RevPAR for the six months increased 8.2 percent, compared to the same period in 2004. ADR made up 70 percent of our RevPAR growth for the period.

	•		Hotel operating profit increased to $135 million for the first six months, compared to $119 million in the prior year period, an increase of 13 percent. Hotel operating profit margin during the six months was 21.7 percent, an increase of 120 basis points over the 20.5 percent margin during the first half of last year.

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 2

“Although a number of our key markets have recovered, other markets are just beginning to recover and are starting to show strong growth this year. Coupled with our portfolio repositioning, the recovery in many of our key markets has enabled our RevPAR growth to outperform the industry averages for the second quarter and year-to-date periods,” said Thomas J. Corcoran, Jr., FelCor’s President and CEO. “RevPAR and EBITDA in markets such as Los Angeles, San Diego, Minneapolis, New Orleans and Washington, D.C. have recovered. However, the recovery in the San Francisco Bay area, Chicago, northern New Jersey and Philadelphia markets has just begun and offers significant upside potential for our EBITDA growth, as these four high-quality, primary markets represent more than 17 percent of our room inventory.”

Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”), Adjusted EBITDA, Same-Store EBITDA, Funds From Operations (“FFO”), Adjusted FFO, Hotel Operating Profit and Hotel Operating Margin are all non-GAAP financial measures. See our discussion of “Non-GAAP Financial Measures” beginning on page 7 for a reconciliation of each of these measures to our net loss and for information regarding the use, limitations and importance of these non-GAAP financial measures.

Capital Structure:

At June 30, 2005, we had $1.7 billion of debt outstanding with a weighted average life of five years, compared to $1.8 billion at December 31, 2004. Our cash and cash equivalents totaled approximately $125 million at the end of the quarter, compared to $119 million at year end.

On April 8, 2005, we completed the issuance of 5.4 million depositary shares representing our 8% Series C preferred stock, with gross proceeds of $135 million. The gross proceeds were used to redeem a like number of depositary shares representing our 9% Series B preferred stock. In the second quarter, we recorded a reduction in net income applicable to common stockholders of $5 million for the original issuance cost of the Series B preferred shares redeemed. This transaction will reduce our preferred dividend obligations by approximately $1.4 million annually to $39 million. Following the redemption, we had approximately $34 million of our Series B preferred stock remaining outstanding.

Other Highlights:

We expect our July total portfolio RevPAR to increase approximately eight percent, compared to the same period in 2004.

During 2005, through July, we have sold five hotels for gross proceeds of $16 million. We also have one hotel under a firm sale contract for $38 million that is currently expected to close in the third quarter of 2005. During the second quarter, we completed the process of surrendering five of eight limited service hotels, owned by a consolidated joint venture with Interstate Hotels and Resorts, to their non-recourse mortgage holders. Two hotels were surrendered in July and the final hotel is expected to be transferred to the lender before the end of the third quarter. These eight hotels are generally located in depressed markets and are expected to generate negative cash flow for the foreseeable future. These hotels have an aggregate fair value less than the outstanding debt balance.

After disposing of the previously mentioned hotels, we will have 13 hotels remaining that we are actively marketing for sale. Gross proceeds from the disposition of these hotels are expected to be approximately $107 million and we anticipate completing the sale of these hotels by mid-2006.

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 3

Our capital expenditures for the most recent quarter totaled $24 million.

We declared and paid second quarter dividends on our Series A, Series B and Series C preferred stock.

2005 Guidance:

As the result of our improving outlook, we have revised our guidance upward for the remainder of the year.

We currently anticipate:

	•		Adjusted EBITDA to be between $268 and $270 million for the full year and between $71 and $72 million for the third quarter;

	•		RevPAR for the full year 2005 to increase 7.5 percent to 8.0 percent over 2004 RevPAR. For the third quarter, we expect RevPAR growth to be between 7.0 to 8.0 percent;

	•		Adjusted FFO per share to be between $1.29 and $1.33 for 2005, and to be between $0.38 and $0.40 for the third quarter;

	•		Net loss applicable to common stockholders to be between $57 million and $55 million, or $0.96 to $0.93 per share for the full year 2005, and $9 million and $8 million, or $0.15 to $0.13 for the third quarter; and

	•		Capital expenditures for 2005, as previously stated, are expected to total approximately $100 million.

“We are taking advantage of the robust demand growth and low supply growth. As we move through this lodging cycle with a higher quality portfolio, we expect strong RevPAR growth and further improvement in our operating margins,” said Richard A. Smith, FelCor’s Executive Vice President and Chief Financial Officer. “As a result of the better than expected lodging trends, we are pleased to raise guidance again for the remainder of 2005.”

We have published our Second Quarter 2005 Supplemental Information, which provides additional corporate data, financial highlights and portfolio statistical data for the quarter and six months ended June 30, 2005. Investors are encouraged to access the Supplemental Information on our Web site at www.felcor.com, on the Investor Relations page in the “Financial Reports” section. The Supplemental Information also will be furnished upon request. Requests may be made by e-mail to information@felcor.com or by writing to the Vice President of Investor Relations, FelCor Lodging Trust Incorporated, 545 E. John Carpenter Freeway, Suite 1300, Irving, Texas, 75062.

FelCor is one of the nation’s largest hotel REITs and the nation’s largest owner of full service, all-suite hotels. FelCor’s portfolio is comprised of 130 consolidated hotels, located in 30 states and Canada. FelCor owns 68 upscale, all-suite hotels, and is the largest owner of Embassy Suites Hotels^® and Doubletree Guest Suites^®hotels. FelCor’s portfolio also includes 60 hotels in the upscale and full service segments. FelCor has a current market capitalization of approximately $3.2 billion. Additional information can be found on the Company’s Web site at www.felcor.com.

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 4

We invite you to listen to our Second Quarter 2005 Conference Call on Thursday, August 4, 2005, at 9:00 a.m. (Central Daylight Time). The conference call will be webcast simultaneously via FelCor’s Web site at www.felcor.com. Interested investors and other parties who wish to access the call should go to FelCor’s Web site and click on the conference call microphone icon on either the “Investor Relations” or “FelCor News” pages. A phone replay will be available from Thursday, August 4, 2005, at 12:00 noon (Central Daylight Time), through Friday, September 2, 2005, at 7:00 p.m. (Central Daylight Time), by dialing 877-244-9051 (access code is 5735). A recording of the call also will be archived and available at www.felcor.com.

With the exception of historical information, the matters discussed in this news release include “forward looking statements” within the meaning of the federal securities laws. Forward looking statements are not guarantees of future performance. Numerous risks and uncertainties, and the occurrence of future events, may cause actual results to differ materially from those currently anticipated. General economic conditions, including the anticipated continuation of the current economic recovery, the impact of U.S. military involvement in the Middle East and elsewhere, future acts of terrorism, the impact on the travel industry of increased fuel prices and security precautions, the impact that the bankruptcy of one or more major air carriers may have on our revenues and receivables, the availability of capital, the ability to effect sales of non-strategic hotels at anticipated prices, and numerous other factors may affect future results, performance and achievements. Certain of these risks and uncertainties are described in greater detail in our filings with the Securities and Exchange Commission. Although we believe our current expectations to be based upon reasonable assumptions, we can give no assurance that our expectations will be attained or that actual results will not differ materially.


Contact:
Thomas J. Corcoran, Jr., President and CEO	(972) 444-4901	tcorcoran@felcor.com
Richard A. Smith, Executive Vice President and CFO	(972) 444-4932	rsmith@felcor.com
Stephen A. Schafer, Vice President of Investor Relations	(972) 444-4912	sschafer@felcor.com
Monica L. Hildebrand, Vice President of Communications	(972) 444-4917	mhildebrand@felcor.com

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 5

Consolidated Statements of Operations
(in thousands, except per share data)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Revenues:
Hotel operating revenue:
Room	$	262,294		$	241,784		$	500,837		$	466,622
Food and beverage		47,154			45,021			88,810			85,194
Other operating departments		16,105			15,640			30,834			30,624
Retail space rental and other revenue		120			180			276			425

Total revenues		325,673			302,625			620,757			582,865


Expenses:
Hotel departmental expenses:
Room		67,105			63,661			128,721			123,352
Food and beverage		35,856			35,275			68,748			67,676
Other operating departments		8,142			7,869			15,367			15,231
Other property related costs		89,903			84,240			177,841			167,230
Management and franchise fees		16,887			15,863			31,687			30,179
Taxes, insurance and lease expense		32,524			29,628			63,341			59,543
Corporate expenses		4,728			4,380			9,269			7,742
Depreciation		30,485			28,027			60,093			56,503
Asset disposition costs		—			—			650			—

Total operating expenses		285,630			268,943			555,717			527,456

Operating income		40,043			33,682			65,040			55,409
Interest expense, net		(33,471	)		(39,203	)		(66,170	)		(79,797	)
Charge-off of deferred financing costs		—			(3,944	)		—			(4,174	)
Impairment		(732	)		—			(732	)		—
Loss on early extinguishment of debt		—			(28,246	)		—			(28,246	)
Gain on swap termination		—			1,005			—			1,005

Income (loss) before equity in income from unconsolidated entities, minority interests and gain on sale of assets		5,840			(36,706	)		(1,862	)		(55,803	)
Equity in income from unconsolidated entities		3,837			2,691			4,968			3,673
Minority interests		111			1,617			975			2,764
Gain on sale of assets		389			—			389			—

Income (loss) from continuing operations		10,177			(32,398	)		4,470			(49,366	)
Discontinued operations		174			725			(2,133	)		(3,006	)

Net income (loss)		10,351			(31,673	)		2,337			(52,372	)
Preferred dividends		(9,809	)		(8,970	)		(19,900	)		(15,696	)
Issuance costs of redeemed preferred stock		(5,198	)		—			(5,198	)		—

Net loss applicable to common stockholders	$	(4,656	)	$	(40,643	)	$	(22,761	)	$	(68,068	)


Basic and diluted per common share data:
Net loss from continuing operations	$	(0.08	)	$	(0.70	)	$	(0.35	)	$	(1.10	)

Net loss	$	(0.08	)	$	(0.69	)	$	(0.38	)	$	(1.15	)

Weighted average common shares outstanding		59,404			58,950			59,363			58,952

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 6

Discontinued Operations
(in thousands)

Included in discontinued operations are the results of operations of the 18 hotels disposed of in 2004, two hotels designated as held for sale at June 30, 2005, and nine hotels disposed of in the first two quarters of 2005. Condensed financial information for the hotels included in discontinued operations is as follows:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Operating revenue	$	6,166		$	32,811		$	14,240		$	68,186
Operating expenses		5,710			31,114			15,118			70,154

Operating income (loss)		456			1,697			(878	)		(1,968	)
Direct interest costs, net		(40	)		(534	)		(581	)		(1,060	)
Impairment loss		—			—			(559	)		—
Loss on sale of assets		(234	)		(1,214	)		(214	)		(941	)
Minority interests		(8	)		776			99			963

Income (loss) from discontinued operations		174			725			(2,133	)		(3,006	)
Depreciation		300			2,144			1,189			4,562
Minority interest in FelCor LP		8			37			(99	)		(154	)
Interest expense		40			536			583			1,064

EBITDA from discontinued operations		522			3,442			(460	)		2,466
Loss on sale of assets		234			1,214			214			941
Impairment loss		—			—			559			—
Asset disposition costs		—			—			650			4,900

Adjusted EBITDA from discontinued operations	$	756		$	4,656		$	963		$	8,307

Selected Balance Sheet Data
(in thousands)


	June 30,			December 31,
	2005			2004
Investment in hotels	$	3,887,365		$	3,904,397
Accumulated depreciation		(994,414	)		(948,631	)

Investments in hotels, net of accumulated depreciation	$	2,892,951		$	2,955,766


Total cash and cash equivalents	$	124,945		$	119,310

Total assets	$	3,294,836		$	3,317,658

Total debt	$	1,743,420		$	1,767,122

Total stockholders’ equity	$	1,309,272		$	1,330,323

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 7

Non-GAAP Financial Measures

We refer in this press release to certain “non-GAAP financial measures.” These measures, including FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin, are measures of our financial performance that are not calculated and presented in accordance with generally accepted accounting principles (“GAAP”). The following tables set forth the adjustments made and reconcile each of these non-GAAP measures to the most comparable GAAP financial measure. Immediately following the reconciliations, we include a discussion of why we believe these measures are useful supplemental measures of our performance and of the limitations upon such measures.

Reconciliation of Net Loss to FFO and Adjusted FFO
(in thousands, except per share and unit data)


	Three Months Ended June 30,
	2005								2004
						Per Share								Per Share
	Dollars			Shares		Amount			Dollars			Shares		Amount
Net income (loss)	$	10,351							$	(31,673	)
Preferred dividends		(9,809	)							(8,970	)
Issuance costs of redeemed preferred stock		(5,198	)							—

Net loss applicable to common stockholders		(4,656	)		59,404	$	(0.08	)		(40,643	)		58,950	$	(0.69	)
Depreciation from continuing operations		30,485					0.51			28,027					0.47
Depreciation from unconsolidated entities and discontinued operations		2,604					0.04			3,991					0.07
Loss (gain) on sale of assets		(155	)				(0.00	)		1,214					0.02
Minority interest in FelCor LP		(216	)		2,788		(0.02	)		(2,078	)		3,033		(0.02	)
Conversion of options and unvested restricted stock		—			339		—			—					—

FFO		28,062			62,531	$	0.45			(9,489	)		61,983		(0.15	)
Charge-off of deferred debt costs		—					—			3,944					0.06
Early extinguishment of debt		—								28,246					0.46
Impairment		732					0.01			—					—
Issuance costs of redeemed preferred stock		5,198					0.08			—					—
Asset disposition costs		—					—			—					—
Gain on swap termination		—					—			(1,005	)				(0.02	)

Adjusted FFO	$	33,992			62,531	$	0.54		$	21,696			61,983	$	0.35

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 8

Reconciliation of Net Loss to FFO and Adjusted FFO
(in thousands, except per share and unit data)


	Six Months Ended June 30,
	2005								2004
						Per Share								Per Share
	Dollars			Shares		Amount			Dollars			Shares		Amount
Net income (loss)	$	2,337							$	(52,372	)
Preferred dividends		(19,900	)							(15,696	)
Issuance costs of redeemed preferred stock		(5,198	)							—

Net loss applicable to common stockholders		(22,761	)		59,363	$	(0.38	)		(68,068	)		58,952	$	(1.15	)
Depreciation from continuing operations		60,093					1.01			56,503					0.96
Depreciation from unconsolidated entities and discontinued operations		5,758					0.10			8,182					0.14
Loss (gain) on sale of assets		(175	)				0.00			941					0.02
Minority interest in FelCor LP		(1,059	)		2,788		(0.06	)		(3,485	)		3,033		(0.07	)
Conversion of options and unvested restricted stock		—			319					—

FFO		41,856			62,470		0.67			(5,927	)		61,985		(0.10	)
Charge-off of deferred debt costs		—								4,174					0.07
Early extinguishment of debt		—								28,246					0.46
Issuance costs of redeemed preferred stock		5,198					0.08			—					—
Asset disposition costs		1,300					0.02			4,900					0.08
Gain on swap termination		—					—			(1,005	)				(0.02	)
Impairment		1,291					0.02			—					—

Adjusted FFO	$	49,645			62,470	$	0.79		$	30,388			61,985	$	0.49

Reconciliation of Net Loss to EBITDA, Adjusted EBITDA and Same-Store EBITDA
(in thousands)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Net income (loss)	$	10,351		$	(31,673	)	$	2,337		$	(52,372	)
Depreciation from continuing operations		30,485			28,027			60,093			56,503
Depreciation from unconsolidated entities and discontinued operations		2,604			3,991			5,758			8,182
Minority interest in FelCor Lodging LP		(216	)		(2,078	)		(1,059	)		(3,485	)
Interest expense		34,273			39,798			67,614			81,114
Interest expense from unconsolidated entities and discontinued operations		1,687			1,943			4,007			3,791
Amortization expense		755			519			1,352			1,022

EBITDA		79,939			40,527			140,102			94,755
Charge off of deferred debt costs		—			3,944			—			4,174
Early extinguishment of debt		—			28,246			—			28,246
Asset disposition costs		—			—			1,300			4,900
Loss (gain) on sale of assets		(155	)		1,214			(175	)		941
Gain on swap termination		—			(1,005	)		—			(1,005	)
Impairment		732			—			1,291			—

Adjusted EBITDA		80,516			72,926			142,518			132,011
Adjusted EBITDA from discontinued operations		(756	)		(4,656	)		(963	)		(8,307	)

Same-Store EBITDA	$	79,760		$	68,270		$	141,555		$	123,704

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 9

Reconciliation of Estimated Net Loss to Estimated FFO and EBITDA
(in millions, except per share and unit data)


	Third Quarter 2005 Guidance												Full Year 2005 Guidance
	Low Guidance						High Guidance						Low Guidance						High Guidance
				Per Share						Per Share						Per Share						Per Share
	Dollars			Amount^(a)			Dollars			Amount^(a)			Dollars			Amount ^(a)			Dollars			Amount ^(a)
Net income (loss)	$	1					$	2					$	(13	)				$	(11	)
Preferred dividends		(10	)					(10	)					(39	)					(39	)
Issuance costs of redeemed preferred stock		—						—						(5	)					(5	)

Net loss applicable to common stockholders		(9	)	$	(0.15	)		(8	)	$	(0.13	)		(57	)	$	(.96	)		(55	)	$	(.93	)
Depreciation		33						33						133						133
Minority interest in FelCor LP		—						—						(2	)					(2	)
Issuance costs of redeemed preferred stock		—						—						5						5

FFO		24			0.38			25			0.40			79			1.26			81			1.29
Asset disposition costs		—						—						1						1
Impairment		—						—						1						1

Adjusted FFO	$	24		$	0.38		$	25		$	0.40		$	81		$	1.29		$	83		$	1.33


Net income (loss)		1						2						(13	)				$	(11	)
Depreciation		33						33						133						133
Minority interest in FelCor LP		—						—						(2	)					(2	)
Interest expense		34						34						137						137
Interest expense from unconsolidated entities		2						2						8						8
Amortization expense		1						1						3						3

EBITDA		71						72						266						268
Asset disposition costs		—						—						1						1
Impairment		—						—						1						1

Adjusted EBITDA	$	71					$	72					$	268					$	270


(a)		Weighted average shares are 59.4 million. Adding minority interest and unvested restricted stock of 3.3 million shares to weighted average shares, provides the weighted average shares and units of 62.7 million used to compute FFO per share.

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 10

Hotel Operating Profit and Hotel Operating Margin
(dollars in thousands)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Total revenue	$	325,673		$	302,625		$	620,757		$	582,865
Retail space rental and other revenue		(120	)		(180	)		(276	)		(425	)

Hotel revenue		325,553			302,445			620,481			582,440
Hotel operating expenses		(250,417	)		(236,536	)		(485,705	)		(463,211	)

Hotel operating profit	$	75,136		$	65,909		$	134,776		$	119,229

Hotel operating margin		23.1	%		21.8	%		21.7	%		20.5	%

Hotel Operating Expense Composition
(dollars in thousands)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Hotel departmental expenses:
Room	$	67,105		$	63,661		$	128,721		$	123,352
Food and beverage		35,856			35,275			68,748			67,676
Other operating departments		8,142			7,869			15,367			15,231
Other property related costs:
Administrative and general		29,406			27,874			57,893			54,982
Marketing and advertising		27,553			25,946			53,859			50,874
Repairs and maintenance		17,518			16,314			34,495			32,666
Energy		15,426			14,106			31,594			28,708
Taxes, insurance and lease expense		32,524			29,628			63,341			59,543

Total other property related costs		122,427			113,868			241,182			226,773
Management and franchise fees		16,887			15,863			31,687			30,179

Hotel operating expenses	$	250,417		$	236,536		$	485,705		$	463,211


Reconciliation of total operating expense to hotel operating expense:
Total operating expenses	$	285,630		$	268,943		$	555,717		$	527,456
Corporate expenses		(4,728	)		(4,380	)		(9,269	)		(7,742	)
Depreciation		(30,485	)		(28,027	)		(60,093	)		(56,503	)
Asset disposition costs		—			—			(650	)		—

Hotel operating expenses	$	250,417		$	236,536		$	485,705		$	463,211


Supplemental information:
Compensation and benefits expense (included in hotel operating expenses)	$	100,618		$	97,084		$	196,571		$	189,629

Substantially all of our non-current assets consist of real estate. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider supplemental measures of performance, which are not measures of operating performance under GAAP, to be helpful in evaluating a real estate company’s operations. These supplemental measures, including FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin, are not measures of operating performance under GAAP. However, we consider these non-GAAP measures to be supplemental measures of a hotel REIT’s performance and should be considered along with, but not as an alternative to, net income as a measure of our operating performance.

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 11

FFO and EBITDA

The White Paper on Funds From Operations approved by the Board of Governors of the National Association of Real Estate Investment Trusts (“NAREIT”), defines FFO as net income or loss (computed in accordance with GAAP), excluding gains or losses from sales of property, plus depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect FFO on the same basis. We compute FFO in accordance with standards established by NAREIT. This may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do.

EBITDA is a commonly used measure of performance in many industries. We define EBITDA as net income or loss (computed in accordance with GAAP) plus interest expenses, income taxes, depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. Adjustments for unconsolidated partnerships and joint ventures are calculated to reflect EBITDA on the same basis.

Adjustments to FFO and EBITDA

We adjust FFO and EBITDA when evaluating our performance because management believes that the exclusion of certain additional recurring and non-recurring items described below provides useful supplemental information to investors regarding our ongoing operating performance and that the presentation of Adjusted FFO, Adjusted EBITDA and Same-Store EBITDA, when combined with GAAP net income, EBITDA and FFO, is beneficial to an investor’s better understanding of our operating performance.

	•		Gains and losses related to early extinguishment of debt and interest rate swaps — We exclude gains and losses related to early 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.

	•		Impairment losses — We exclude the effect of impairment losses and gains or losses on disposition of assets in computing Adjusted FFO and Adjusted EBITDA because we believe that including these is not consistent with reflecting the ongoing performance of our remaining assets. Additionally, we believe that impairment charges and gains or losses on disposition of assets represent accelerated depreciation, or excess depreciation, and depreciation is excluded from FFO by the NAREIT definition and 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.

In addition, to derive Adjusted EBITDA, we exclude gains or losses on the sale of assets because we believe that including them in EBITDA is not consistent with reflecting the ongoing performance of our remaining assets. Additionally, the gain or loss on sale of depreciable assets represents either accelerated depreciation or excess depreciation in previous periods, and depreciation is excluded from EBITDA.

To derive Same-Store EBITDA, we make the same adjustments to EBITDA as for Adjusted EBITDA and, additionally, exclude EBITDA from discontinued operations and gains and losses on the disposition of non-hotel related assets.

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FelCor Lodging Trust Second Quarter 2005 Operating Results
August 3, 2005
Page 12

Hotel Operating Profit and Operating Margin

Hotel operating profit and operating margin are commonly used measures of performance in the industry and give investors a more complete understanding of the operating results over which our individual hotels and operating managers have direct control. We believe that hotel operating profit and operating margin is useful to investors by providing greater transparency with respect to two significant measures used by us in our financial and operational decision-making. Additionally, these measures facilitate comparisons with other hotel REITs and hotel owners. We present hotel operating profit and hotel operating margin by eliminating corporate-level expenses, depreciation and expenses related to our capital structure. We eliminate corporate-level costs and expenses because we believe property-level results provide investors with supplemental information with respect to the ongoing operating performance of our hotels and the effectiveness of management in running our business on a property-level basis. We eliminate depreciation and amortization, even though they are property-level expenses, because we do not believe that these non-cash expenses, which are based on historical cost accounting for real estate assets and implicitly assume that the value of real estate assets diminish predictably over time, accurately reflect an adjustment in the value of our assets.

Use and Limitations of Non-GAAP Measures

Our management and Board of Directors use FFO, Adjusted FFO, EBITDA and Adjusted EBITDA to evaluate the performance of our hotels and to facilitate comparisons between us and other lodging REITs, hotel owners who are not REITs and other capital intensive companies. Same-Store EBITDA is used to provide investors with supplemental information as to the ongoing operating performance of our hotels without regard to those hotels sold or held for sale at the date of presentation.

The use of these non-GAAP financial measures has certain limitations. FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin, as presented by us, may not be comparable to FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin as calculated by other real estate companies. These measures do not reflect certain expenses that we incurred and will incur, such as depreciation, interest and capital expenditures. Management compensates for these limitations by separately considering the impact of these excluded items to the extent they are material to operating decisions or assessments of our operating performance. Our reconciliations to the GAAP financial measures, and our consolidated statements of operations and cash flows, include interest expense, capital expenditures, and other excluded items, all of which should be considered when evaluating our performance, as well as the usefulness of our non-GAAP financial measures.

These non-GAAP financial measures are used in addition to and in conjunction with results presented in accordance with GAAP. They should not be considered as alternatives to operating profit, cash flow from operations, or any other operating performance measure prescribed by GAAP. Neither should FFO, FFO per share, Adjusted FFO, Adjusted FFO per share, EBITDA, Adjusted EBITDA or Same-Store EBITDA be considered as measures of our liquidity or indicative of funds available for our cash needs, including our ability to make cash distributions. FFO per share does not measure, and should not be used as a measure of, amounts that accrue directly to the benefit of stockholders. FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin reflect additional ways of viewing our operations that we believe when viewed with our GAAP results and the reconciliations to the corresponding GAAP financial measures provide a more complete understanding of factors and trends affecting our business than could be obtained absent this disclosure. Management strongly encourages investors to review our financial information in its entirety and not to rely on any single financial measure.

###

EX-99.2 3 d27540exv99w2.htm SUPPLEMENTAL INFORMATION exv99w2

Exhibit 99.2

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Date of Issuance August 3, 2005

All dollar amounts shown in this report are in U.S. dollars unless otherwise noted.
This Supplemental Information is neither an offer to sell nor a solicitation to buy any securities of
FelCor. Any offers to sell or solicitations to buy any securities of FelCor shall be made only by
means of a prospectus.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

TABLE OF CONTENTS


	PAGE
CORPORATE DATA
About the Company		3
Board of Directors and Executive Officers		4
Equity Research Coverage		5

FINANCIAL HIGHLIGHTS
Supplemental Financial Data		6
Consolidated Statements of Operations		7
Discontinued Operations		8
Non-GAAP Financial Measures		8
Reconciliation of Net Loss to FFO and Adjusted FFO		9
Reconciliation of Net Loss to EBITDA, Adjusted EBITDA and Same-Store EBITDA		10
Hotel Operating Profit and Hotel Operating Margin		10
Hotel Operating Expense Composition		11
Debt Summary		15

PORTFOLIO DATA
Portfolio Distribution		17
Detailed Operating Statistics by Brand		18
Detailed Operating Statistics for FelCor’s Top Markets		19
Other Performance Statistics		20
Hotel Portfolio Information		21
Hotel Portfolio Listing		24

This supplement contains registered trademarks owned or licensed by companies other than us, which may include, but are not limited to, Courtyard by Marriott^®, Crowne Plaza^®, Disneyland^®, Doubletree^®, Doubletree Guest Suites^®, Embassy Suites Hotel^®, Fairfield Inn^®, Hampton Inn^®, Harvey Suites^®, Hilton^®, Hilton Suites^®, Holiday Inn^®, Holiday Inn & Suites^®, Holiday Inn Express^®, Holiday Inn Express & Suites^®, Holiday Inn Select^®, Sheraton^®, Sheraton Suites^®, Staybridge Suites^®, Walt Disney World^®, Worlds of Fun^® and Westin^®.

With the exception of historical information, the matters discussed in this supplement include “forward looking statements” within the meaning of the federal securities laws. Forward looking statements are not guarantees of future performance. Numerous risks and uncertainties, and the occurrence of future events, may cause actual results to differ materially from those currently anticipated. General economic conditions, including the anticipated continuation of the current economic recovery, the impact of U.S. military involvement in the Middle East and elsewhere, future acts of terrorism, the impact on the travel industry of increased fuel prices and increased security precautions, the impact that the bankruptcy of one or more major air carriers may have on our revenues and receivables, the availability of capital, the ability to effect sales of non-strategic hotels at anticipated prices, and numerous other factors may affect our future results, performance and achievements. Certain of these risks and uncertainties are described in greater detail in our filings with the Securities and Exchange Commission. Although we believe our current expectations to be based upon reasonable assumptions, we can give no assurance that our expectations will be attained or that actual results will not differ materially.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

CORPORATE DATA

About the Company

In 1994, FelCor Lodging Trust Incorporated went public as a real estate investment trust (REIT) with six hotels and a market capitalization of $120 million. At June 30, 2005, FelCor was one of the nation’s largest lodging REIT’s and the nation’s largest owner of full service, all-suite hotels. FelCor’s portfolio was comprised of 135 consolidated hotels, including 133 hotels in continuing operations and two hotels that were classified as “held for sale” and included in discontinued operations. For the 133 hotels included in continuing operations, the operating revenues and expenses are reflected in FelCor’s consolidated statements of operations because of our ownership interests of the operating lessees of these hotels. FelCor also owned 50% joint venture interests in five hotels whose operations were accounted for using the equity method. FelCor owned 69 full service, all-suite hotels, and was the largest owner of Embassy SuitesHotels and Doubletree Guest Suiteshotels. FelCor’s portfolio also included 61 hotels in the upscale and full service segments. The Company’s hotels were located in 31 states and Canada. FelCor had a market capitalization of approximately $3.2 billion at June 30, 2005.

Strategy

FelCor’s hotels are generally managed by the brand owners such as Hilton Hotels Corporation, InterContinental Hotels Group, and Starwood Hotels & Resorts. FelCor is competitively positioned to deliver superior long-term stockholder returns through its strong management team, diversified upscale and full-service hotels, and strategic brand manager alliances.

Stock and Debt Ratings


	Senior Unsecured Debt	Preferred Stock
Moody’s	B1	B3
Standard & Poors	B-	CCC

Stock Exchange Listing
Common Stock (NYSE: FCH)
$1.95 Series A Cumulative Convertible Preferred Stock (NYSE: FCHPRA)
9% Series B Cumulative Redeemable Preferred Stock (NYSE: FCHPRB)
8% Series C Cumulative Redeemable Preferred Stock (NYSE:FCHPRC)

Fiscal Year End
December 31

Number of employees
71

Corporate Headquarters
545 E. John Carpenter Frwy., Suite 1300
Irving, TX 75062
(972) 444-4900


Investor Relations Contact Stephen A. Schafer Vice President of Investor Relations (972) 444-4912 sschafer@felcor.com		Media Contact Monica L. Hildebrand Vice President of Communications (972) 444-4917 mhildebrand@felcor.com

Information Request
information@felcor.com

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Board of Directors

Donald J. McNamara, Chairman of the Board
Principal, The Hampstead Group

Thomas J. Corcoran, Jr.
President and Chief Executive Officer, FelCor Lodging Trust Incorporated

Melinda J. Bush, C.H.A.
Chairman and Chief Executive Officer, HRW Holdings, LLC

Richard S. Ellwood
President, R.S. Ellwood and Co., Inc.

Richard O. Jacobson
Chairman of the Board, Jacobson Warehouse Company, Inc.

David C. Kloeppel
Executive Vice President and Chief Financial Officer, Gaylord Entertainment Company

Charles A. Ledsinger, Jr.
President and Chief Executive Officer, Choice Hotels International

Robert H. Lutz, Jr.
President, RL Investments, Inc.

Robert A. Mathewson
President, RGC, Inc.

Michael D. Rose
Chairman, Gaylord Entertainment Company

Executive Officers

Thomas J. Corcoran, Jr., President and Chief Executive Officer

Richard A. Smith, Executive Vice President and Chief Financial Officer

Michael A. DeNicola, Executive Vice President and Chief Investment Officer

Lawrence D. Robinson, Executive Vice President, General Counsel and Secretary

Jack Eslick, Senior Vice President, Director of Asset Management

Lester C. Johnson, Senior Vice President, Controller and Principal Accounting Officer

June C. McCutchen, Senior Vice President, Director of Design and Construction

Larry J. Mundy, Senior Vice President, Director of Business Initiatives and Assistant General Counsel

Andrew J. Welch, Senior Vice President and Treasurer

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Equity Research Coverage


Firm	Analyst	Telephone
Deutsche Bank North America	Marc J. Falcone	(212) 469-7417

Friedman, Billings, Ramsey, & Co.	Gustavo Sarago	(703) 469-1042

Green Street Advisors	John V. Arabia	(949) 640-8780

JPMorgan Securities	Harry C. Curtis	(212) 622-6610

Legg Mason Wood Walker, Inc.	Rod F. Petrik	(410) 454-4131

Lehman Brothers	Felicia Kantor Hendrix	(212) 526-5562

Merrill Lynch	David W. Anders	(212) 449-2739

Prudential Equity Group, LLC	James W. Sullivan	(212) 778-2515

Smith Barney Citigroup	Michael J. Rietbrock	(212) 816-7777

UBS (US)	William B. Truelove	(212) 713-3098

Wachovia Securities	Jeffrey J. Donnelly	(617) 603-4262

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

FINANCIAL HIGHLIGHTS

Supplemental Financial Data
(in thousands, except per share information, ratios and percentages)


	June 30,			December 31,
	2005			2004
Total Enterprise Value
Common shares outstanding		60,164			59,817
Units outstanding		2,788			2,788

Combined shares and units outstanding		62,952			62,605
Common stock price at end of period	$	14.48		$	14.65

Common equity capitalization	$	911,545		$	917,163
Series A preferred stock		309,362			309,362
Series B preferred stock		34,395			169,395
Series C preferred stock		135,000			—
Consolidated debt		1,743,420			1,767,122
Minority interest of consolidated debt		(8,221	)		(5,618	)
Pro rata share of unconsolidated debt		103,839			109,146
Cash and cash equivalents		(124,945	)		(119,310	)

Total enterprise value (TEV)	$	3,104,395		$	3,147,260


TEV per room^(a)	$	86		$	84
Pro rata rooms owned		36,061			37,338

Dividends Per Share
Dividends declared (quarter ended):
Series A preferred stock	$	0.4875		$	0.4875
Series B preferred stock (depositary shares)		0.5625			0.5625
Series C preferred stock (depositary shares)^(b)		0.6333			—

Selected Balance Sheet Data
Investment in hotels, at cost^(c)	$	3,887,365		$	3,904,397
Total cash and cash equivalents		124,945			119,310
Total assets		3,294,836			3,317,658
Total debt		1,743,420			1,767,122
Total stockholders’ equity		1,309,272			1,330,323
Total stockholders equity less preferred equity		830,515			851,566
Book value per common share outstanding		13.80			14.24


(a)		Based on pro rata rooms owned.

(b)		The dividend declared on the Series C preferred stock is pro rated to reflect the accrual of dividends from the date of issuance of such shares. The recurring quarterly dividend payment on the Series C preferred stock is $0.5000 per depositary share.

(c)		Investment in hotels, at cost, is defined as consolidated hotel book value (after impairment charges but before accumulated depreciation).

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Consolidated Statements of Operations
(in thousands, except per share data)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Revenues:
Hotel operating revenue:
Room	$	262,294		$	241,784		$	500,837		$	466,622
Food and beverage		47,154			45,021			88,810			85,194
Other operating departments		16,105			15,640			30,834			30,624
Retail space rental and other revenue		120			180			276			425

Total revenues		325,673			302,625			620,757			582,865


Expenses:
Hotel departmental expenses:
Room		67,105			63,661			128,721			123,352
Food and beverage		35,856			35,275			68,748			67,676
Other operating departments		8,142			7,869			15,367			15,231
Other property related costs		89,903			84,240			177,841			167,230
Management and franchise fees		16,887			15,863			31,687			30,179
Taxes, insurance and lease expense		32,524			29,628			63,341			59,543
Corporate expenses		4,728			4,380			9,269			7,742
Depreciation		30,485			28,027			60,093			56,503
Asset disposition costs		—			—			650			—

Total operating expenses		285,630			268,943			555,717			527,456


Operating income		40,043			33,682			65,040			55,409
Interest expense, net		(33,471	)		(39,203	)		(66,170	)		(79,797	)
Charge-off of deferred financing costs		—			(3,944	)		—			(4,174	)
Impairment		(732	)		—			(732	)		—
Loss on early extinguishment of debt		—			(28,246	)		—			(28,246	)
Gain on swap termination		—			1,005			—			1,005

Income (loss) before equity in income from unconsolidated entities, minority interests and gain on sale of assets		5,840			(36,706	)		(1,862	)		(55,803	)
Equity in income from unconsolidated entities		3,837			2,691			4,968			3,673
Minority interests		111			1,617			975			2,764
Gain on sale of assets		389			—			389			—

Income (loss) from continuing operations		10,177			(32,398	)		4,470			(49,366	)
Discontinued operations		174			725			(2,133	)		(3,006	)

Net income (loss)		10,351			(31,673	)		2,337			(52,372	)
Preferred dividends		(9,809	)		(8,970	)		(19,900	)		(15,696	)
Issuance costs of redeemed preferred stock		(5,198	)		—			(5,198	)		—

Net loss applicable to common stockholders	$	(4,656	)	$	(40,643	)	$	(22,761	)	$	(68,068	)


Basic and diluted per common share data:
Net loss from continuing operations	$	(0.08	)	$	(0.70	)	$	(0.35	)	$	(1.10	)

Net loss	$	(0.08	)	$	(0.69	)	$	(0.38	)	$	(1.15	)

Weighted average common shares outstanding		59,404			58,950			59,363			58,952

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Discontinued Operations
(in thousands)

Included in discontinued operations are the results of operations of the 18 hotels disposed of in 2004, two hotels designated as held for sale at June 30, 2005, and nine hotels disposed of in the first six months of 2005. Condensed financial information for the hotels included in discontinued operations is as follows:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Operating revenue	$	6,166		$	32,811		$	14,240		$	68,186
Operating expenses		5,710			31,114			15,118			70,154

Operating income (loss)		456			1,697			(878	)		(1,968	)
Direct interest costs, net		(40	)		(534	)		(581	)		(1,060	)
Impairment loss		—			—			(559	)		—
Loss on sale of assets		(234	)		(1,214	)		(214	)		(941	)
Minority interests		(8	)		776			99			963

Income (loss) from discontinued operations		174			725			(2,133	)		(3,006	)
Depreciation		300			2,144			1,189			4,562
Minority interest in FelCor LP		8			37			(99	)		(154	)
Interest expense		40			536			583			1,064

EBITDA from discontinued operations		522			3,442			(460	)		2,466
Loss on sale of assets		234			1,214			214			941
Impairment loss		—			—			559			—
Asset disposition costs		—			—			650			4,900

Adjusted EBITDA from discontinued operations	$	756		$	4,656		$	963		$	8,307

Non-GAAP Financial Measures

We refer in this supplement to certain “non-GAAP financial measures.” These measures, including FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin, are measures of our financial performance that are not calculated and presented in accordance with generally accepted accounting principles (“GAAP”). The following tables reconcile each of these non-GAAP measures to the most comparable GAAP financial measure. Immediately following the reconciliations, we include a discussion of why we believe these measures are useful supplemental measures of our performance and of the limitations upon such measures.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Non-GAAP Financial Measures (continued)

Reconciliation of Net Income (Loss) to FFO and Adjusted FFO
(in thousands, except per share data)


	Three Months Ended June 30,
	2005								2004
						Per Share								Per Share
	Dollars			Shares		Amount			Dollars			Shares		Amount
Net income (loss)	$	10,351							$	(31,673	)
Preferred dividends		(9,809	)							(8,970	)
Issuance costs of redeemed preferred stock		(5,198	)							—

Net loss applicable to common stockholders		(4,656	)		59,404	$	(0.08	)		(40,643	)		58,950	$	(0.69	)
Depreciation from continuing operations		30,485					0.51			28,027					0.47
Depreciation from unconsolidated entities and discontinued operations		2,604					0.04			3,991					0.07
Loss (gain) on sale of assets		(155	)				(0.00	)		1,214					0.02
Minority interest in FelCor LP		(216	)		2,788		(0.02	)		(2,078	)		3,033		(0.02	)
Conversion of options and unvested restricted stock		—			339		—			—					—

FFO		28,062			62,531	$	0.45			(9,489	)		61,983		(0.15	)
Charge off of deferred debt costs		—					—			3,944					0.06
Early extinguishment of debt		—								28,246					0.46
Impairment		732					0.01			—					—
Issuance costs of redeemed preferred stock		5,198					0.08			—					—
Gain on swap termination		—					—			(1,005	)				(0.02	)

Adjusted FFO	$	33,992			62,531	$	0.54		$	21,696			61,983	$	0.35


	Six Months Ended June 30,
	2005								2004
						Per Share								Per Share
	Dollars			Shares		Amount			Dollars			Shares		Amount
Net income (loss)	$	2,337							$	(52,372	)
Preferred dividends		(19,900	)							(15,696	)
Issuance costs of redeemed preferred stock		(5,198	)							—

Net loss applicable to common stockholders		(22,761	)		59,363	$	(0.38	)		(68,068	)		58,952	$	(1.15	)
Depreciation from continuing operations		60,093					1.01			56,503					0.96
Depreciation from unconsolidated entities and discontinued operations		5,758					0.10			8,182					0.14
Loss (gain) on sale of assets		(175	)				0.00			941					0.02
Minority interest in FelCor LP		(1,059	)		2,788		(0.06	)		(3,485	)		3,033		(0.07	)
Conversion of options and unvested restricted stock		—			319					—

FFO		41,856			62,470		0.67			(5,927	)		61,985		(0.10	)
Charge off of deferred debt costs		—								4,174					0.07
Early extinguishment of debt		—								28,246					0.46
Issuance costs of redeemed preferred stock		5,198					0.08			—					—
Asset disposition costs		1,300					0.02			4,900					0.08
Gain on swap termination		—					—			(1,005	)				(0.02	)
Impairment		1,291					0.02			—					—

Adjusted FFO	$	49,645			62,470	$	0.79		$	30,388			61,985	$	0.49

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Non-GAAP Financial Measures (continued)

Reconciliation of Net Income (Loss) to EBITDA, Adjusted EBITDA and Same-Store EBITDA
(in thousands)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Net income (loss)	$	10,351		$	(31,673	)	$	2,337		$	(52,372	)
Depreciation from continuing operations		30,485			28,027			60,093			56,503
Depreciation from unconsolidated entities and discontinued operations		2,604			3,991			5,758			8,182
Minority interest in FelCor Lodging LP		(216	)		(2,078	)		(1,059	)		(3,485	)
Interest expense		34,273			39,798			67,614			81,114
Interest expense from unconsolidated entities and discontinued operations		1,687			1,943			4,007			3,791
Amortization expense		755			519			1,352			1,022

EBITDA		79,939			40,527			140,102			94,755
Charge off of deferred debt costs		—			3,944			—			4,174
Early extinguishment of debt		—			28,246			—			28,246
Asset disposition costs		—			—			1,300			4,900
Loss (gain) on sale of assets		(155	)		1,214			(175	)		941
Gain on swap termination		—			(1,005	)		—			(1,005	)
Impairment		732			—			1,291			—

Adjusted EBITDA		80,516			72,926			142,518			132,011
Adjusted EBITDA from discontinued operations		(756	)		(4,656	)		(963	)		(8,307	)

Same-Store EBITDA	$	79,760		$	68,270		$	141,555		$	123,704

Hotel Operating Profit and Hotel Operating Margin
(dollars in thousands)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Total revenue	$	325,673		$	302,625		$	620,757		$	582,865
Retail space rental and other revenue		(120	)		(180	)		(276	)		(425	)

Hotel revenue		325,553			302,445			620,481			582,440
Hotel operating expenses		(250,417	)		(236,536	)		(485,705	)		(463,211	)

Hotel operating profit	$	75,136		$	65,909		$	134,776		$	119,229

Hotel operating margin		23.1	%		21.8	%		21.7	%		20.5	%

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Non-GAAP Financial Measures (continued)

Hotel Operating Expense Composition
(dollars in thousands)


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2005			2004			2005			2004
Hotel departmental expenses:
Room	$	67,105		$	63,661		$	128,721		$	123,352
Food and beverage		35,856			35,275			68,748			67,676
Other operating departments		8,142			7,869			15,367			15,231

Other property related costs:
Administrative and general		29,406			27,874			57,893			54,982
Marketing and advertising		27,553			25,946			53,859			50,874
Repairs and maintenance		17,518			16,314			34,495			32,666
Energy		15,426			14,106			31,594			28,708
Taxes, insurance and lease expense		32,524			29,628			63,341			59,543

Total other property related costs		122,427			113,868			241,182			226,773
Management and franchise fees		16,887			15,863			31,687			30,179

Hotel operating expenses	$	250,417		$	236,536		$	485,705		$	463,211


Reconciliation of total operating expense to hotel operating expense:
Total operating expenses	$	285,630		$	268,943		$	555,717		$	527,456
Corporate expenses		(4,728	)		(4,380	)		(9,269	)		(7,742	)
Depreciation		(30,485	)		(28,027	)		(60,093	)		(56,503	)
Asset disposition costs		—			—			(650	)		—

Hotel operating expenses	$	250,417		$	236,536		$	485,705		$	463,211


Supplemental information:
Compensation and benefits expense (included in hotel operating expenses)	$	100,618		$	97,084		$	196,571		$	189,629

Substantially all of our non-current assets consist of real estate. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminish predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider supplemental measures of performance, which are not measures of operating performance under GAAP, to be helpful in evaluating a real estate company’s operations. These supplemental measures, including FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin, are not measures of operating performance under GAAP. However, we consider these non-GAAP measures to be supplemental measures of a hotel REIT’s performance and should be considered along with, but not as an alternative to, net income as a measure of our operating performance.

FFO and EBITDA

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Non-GAAP Financial Measures (continued)

This may not be comparable to FFO reported by other REITs that do not define the term in accordance with the current NAREIT definition, or that interpret the current NAREIT definition differently than we do.

Adjustments to FFO and EBITDA

	•		Gains and losses related to early extinguishment of debt and interest rate swaps — We exclude gains and losses related to early 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.

	•		Impairment losses — We exclude the effect of impairment losses and gains or losses on disposition of assets in computing Adjusted FFO and Adjusted EBITDA because we believe that including these is not consistent with reflecting the ongoing performance of our remaining assets. Additionally, we believe that impairment charges and gains or losses on disposition of assets represent accelerated depreciation or excess depreciation, and depreciation is excluded from FFO by the NAREIT definition and 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.

In addition, to derive Adjusted EBITDA, we adjust EBITDA for gains or losses on the sale of assets because we believe that including them in EBITDA is not consistent with reflecting ongoing performance of our remaining assets. Additionally, the gain or loss on sale of depreciable assets represents either accelerated depreciation or excess depreciation in previous periods, and depreciation is excluded from EBITDA.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Non-GAAP Financial Measures (continued)

Hotel Operating Profit and Operating Margin

Hotel operating profit and operating margin are commonly used measures of performance in the hotel industry and give investors a more complete understanding of the operating results over which our individual hotels and operating managers have direct control. We believe that hotel operating profit and operating margin is useful to investors by providing greater transparency with respect to two significant measures used by us in our financial and operational decision-making. Additionally, using these measures facilitate comparisons with other hotel REITs and hotel owners. We present hotel operating profit and hotel operating margin by eliminating corporate-level expenses, depreciation and expenses related to our capital structure. We eliminate corporate-level costs and expenses because we believe property-level results provide investors with supplemental information with respect to the ongoing operating performance of our hotels and the effectiveness of management in running our business on a property-level basis. We eliminate depreciation and amortization, even though depreciation and amortization are property-level expenses, because we do not believe that these non-cash expenses, which are based on historical cost accounting for real estate assets and implicitly assumes that the value of real estate assets diminishes predictably over time, accurately reflect an adjustment in the value of our assets.

Use and Limitations of Non-GAAP Measures

Our management and Board of Directors use FFO, Adjusted FFO, EBITDA, Adjusted EBITDA and Same-Store EBITDA to evaluate the performance of our hotels and to facilitate comparisons between us and other lodging REITs, hotel owners who are not REITs and other capital intensive companies. Same-Store EBITDA is used to provide investors with supplemental information as to the ongoing operating performance of our hotels without regard to those hotels sold or held for sale at the date of presentation. We use hotel operating margin in evaluating hotel-level performance and the operating efficiency of our hotel managers.

The use of these non-GAAP financial measures have certain limitations. FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin, as presented by us, may not be comparable to FFO, Adjusted FFO, EBITDA, Adjusted EBITDA, Same-Store EBITDA, hotel operating profit and hotel operating margin as calculated by other real estate companies. These measures do not reflect certain expenses that we incurred and will incur, such as depreciation, interest and capital expenditures. Management compensates for these limitations by separately considering the impact of these excluded items to the extent they are material to operating decisions or assessments of our operating performance. Our reconciliations to the GAAP financial measures, and our consolidated statements of operations and cash flows, include interest expense, capital expenditures, and other excluded items, all of which should be considered when evaluating our performance, as well as the usefulness of our non-GAAP financial measures.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Non-GAAP Financial Measures (continued)

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Debt Summary
(dollars in thousands)

Debt Outstanding

Encumbered

Interest Rate at

Maturity

Consolidated

Hotels

June 30, 2005

Date

Debt

Promissory note

none

5.14

June 2016

650

Senior unsecured term notes

none

7.63

October 2007

122,892

Senior unsecured term notes

none

9.00

June 2011

298,535

Senior unsecured term notes

none

7.79

^(a)

June 2011

290,000

Total unsecured debt

8.27

712,077

Mortgage debt

9 hotels

6.52

July 2009-2014

105,189

Mortgage debt

6 hotels

4.74

^(b)

August 2007

85,511

Mortgage debt

10 hotels

5.13

^(b)

May 2006

142,905

Mortgage debt

15 hotels

7.24

Nov. 2007

125,779

Mortgage debt

7 hotels

7.32

April 2009

128,966

Mortgage debt

6 hotels

7.55

June 2009

67,306

Mortgage debt

8 hotels

8.70

May 2010

174,066

Mortgage debt

7 hotels

8.73

May 2010

134,660

Mortgage debt

1 hotel

5.81

August 2008

15,500

Mortgage debt

1 hotel

7.23

October 2005

10,189

Mortgage debt

3 hotels

7.48

April 2011

25,022

^(c)

Mortgage debt

1 hotel

7.91

December 2007

10,585

Other

1 hotel

9.17

August 2011

5,665

Total secured debt

75 hotels

7.25

1,031,343

Total

7.66

1,743,420


(a)		The stated interest rate on this debt is LIBOR (3.53% at June 30, 2005) plus 4.25%. We have swapped $100 million of this floating rate debt for a fixed rate of 7.80%. The resulting weighted average rate on these notes was 7.79% at June 30, 2005.

(b)		This debt has two, one-year extension options, subject to certain contingencies.

(c)		$22 million of this debt was extinguished in July upon the surrender of the two hotels to their non-recourse mortgage holder. The remainder of this debt is expected to be extinguished in the third quarter upon the surrender of the remaining hotel to its non-recourse mortgage holder.


Fixed interest rate debt to total debt		74.6	%
Weighted average maturity of debt	5 years
Secured debt to total assets		31.3	%

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Debt Summary (continued)

At June 30, 2005, future scheduled principal payments on outstanding debt are as follows (in thousands):


	Secured			Unsecured
Year	Debt			Debt			Total
2005	$	21,212	^(a)	$	—		$	21,212
2006		160,797	^(b)		—			160,797
2007		148,383			125,000			273,383
2008		33,946			—			33,946
2009 and thereafter		667,382			590,650			1,258,032
Premium/(discount)		(377	)		(3,573	)		(3,950	)

Total debt	$	1,031,343		$	712,077		$	1,743,420


(a)		Includes a $10.2 million of a non-recourse mortgage note that matures in October 2005.

(b)		Included is a $145 million non-recourse mortgage loan maturing in 2006, that has two, one-year extension options, subject to certain contingencies.

At June 30, 2005, we had unconsolidated 50 percent investments in ventures that owned an aggregate of 19 hotels. These ventures had approximately $208 million of non-recourse mortgage debt, all of which is secured by hotel assets. Our pro rata share of this non-recourse debt is $104 million.

Financing transactions in 2005:

On April 8, 2005, we completed the issuance of 5.4 million depositary shares representing our 8% Series C preferred stock, with gross proceeds of $135 million. The gross proceeds were used to redeem a like number of depositary shares representing our 9% Series B preferred stock. In the second quarter we recorded a reduction in net income available to common stockholders of $5 million for the original issuance cost of the preferred shares redeemed. This transaction will reduce preferred dividends by approximately $1.4 million annually to $39 million. Following the redemption, we had approximately $34 million of our Series B preferred stock outstanding.

In July 2005, we made the initial draw of $3.8 million on our $69.8 million recourse construction loan, for the development of a 184-unit condominium project in Myrtle Beach, South Carolina. The interest on this facility is currently based on LIBOR plus 225 basis points and will be capitalized as part of the cost of the project. The interest rate may be reduced to LIBOR plus 200 basis points when the project is 55% complete and upon satisfaction of certain other requirements. The facility matures in the fourth quarter of 2007.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

PORTFOLIO DATA

Portfolio Distribution at June 30, 2005
(130 consolidated hotels included in continuing operations, same store basis)


					% of			% of 2004 Hotel
Brand	Hotels		Rooms		Total Rooms			Operating Profit^(a)
Embassy Suites Hotel		55		13,925		37	%		52	%
Holiday Inn-branded		36		12,221		32			22
Sheraton-branded		10		3,269		9			10
Doubletree-branded		10		2,206		6			6
Crowne Plaza		12		4,025		11			5
Other		7		1,811		5			5


					% of			% of 2004 Hotel
Top Markets	Hotels		Rooms		Total Rooms			Operating Profit
Atlanta		10		3,061		8	%		9	%
Dallas		12		3,586		10			5
Los Angeles Area		6		1,435		4			5
Orlando		6		2,219		6			5
Boca Raton/Ft. Lauderdale		4		1,118		3			4
New Orleans		2		746		2			4
Minneapolis		4		955		3			4
Philadelphia		3		1,174		3			3
San Diego		1		600		2			3
Phoenix		3		798		2			3
San Antonio		4		1,189		3			3
Northern New Jersery		3		759		2			3
Chicago		4		1,239		3			3
San Francisco Bay Area		8		2,690		7			3
Houston		4		1,403		4			3
Washington DC		1		437		1			3


					% of			% of 2004 Hotel
Top Four States	Hotels		Rooms		Total Rooms			Operating Profit
California		19		5,536		15	%		16	%
Texas		26		7,515		20			14
Florida		16		5,343		14			12
Georgia		12		3,415		9			9


					% of			% of 2004 Hotel
Location	Hotels		Rooms		Total Rooms			Operating Profit
Suburban		58		14,743		39	%		39	%
Urban		31		10,069		27			27
Airport		26		8,183		22			22
Resort		13		4,044		11			12
Interstate		2		418		1			0


					% of			% of 2004 Hotel
Segment	Hotels		Rooms		Total Rooms			Operating Profit
Upscale all-suite		68		16,791		45	%		59	%
Full service		37		12,385		33			23
Upscale		23		7,843		21			17
Limited service		2		438		1			1


^(a) Hotel operating profit is more fully described on page 13 of this supplement.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Detailed Operating Statistics by Brand
(130 consolidated hotels included in continuing operations, same store basis)


	Occupancy (%)
	Three Months Ended June 30,							Six Months Ended June 30,
	2005		2004		%Variance			2005		2004		% Variance
Embassy Suites Hotels		76.5		72.6		5.3			73.7		71.2		3.6
Holiday Inn-branded hotels		70.6		69.1		2.2			66.8		65.7		1.7
Sheraton-branded hotels		67.3		66.0		2.0			64.5		65.0		(0.8	)
Doubletree-branded hotels		72.2		70.1		3.1			68.7		69.4		(1.0	)
Crowne Plaza hotels		70.1		65.2		7.6			66.8		63.4		5.3
Other hotels		61.6		64.5		(4.5	)		59.2		59.4		(0.3	)

Total hotels		72.1		69.5		3.7			68.9		67.4		2.3


	ADR ($)
	Three Months Ended June 30,						Six Months Ended June 30,
	2005		2004		% Variance		2005		2004		% Variance
Embassy Suites Hotels		121.15		117.39		3.2		123.54		118.31		4.4
Holiday Inn-branded hotels		88.75		83.31		6.5		86.75		82.28		5.4
Sheraton-branded hotels		111.02		96.82		14.7		109.48		97.19		12.6
Doubletree-branded hotels		110.96		105.10		5.6		112.28		104.45		7.5
Crowne Plaza hotels		101.57		96.44		5.3		97.22		92.79		4.8
Other hotels		102.73		95.57		7.5		97.32		91.44		6.4

Total hotels		106.57		100.83		5.7		106.27		100.50		5.7


	RevPAR ($)
	Three Months Ended June 30,						Six Months Ended June 30,
	2005		2004		% Variance		2005		2004		% Variance
Embassy Suites Hotels		92.63		85.23		8.7		91.08		84.22		8.1
Holiday Inn-branded hotels		62.65		57.56		8.8		57.95		54.07		7.2
Sheraton-branded hotels		77.87		63.10		23.4		73.11		61.63		18.6
Doubletree-branded hotels		74.65		69.36		7.6		72.43		67.94		6.6
Crowne Plaza hotels		73.35		67.58		8.5		66.75		64.35		3.7
Other hotels		63.29		61.64		2.7		57.63		54.32		6.1

Total hotels		76.83		70.12		9.6		73.23		67.69		8.2

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Detailed Operating Statistics for FelCor’s Top Markets
(130 consolidated hotels included in continuing operations, same store basis)


	Occupancy (%)
	Three Months Ended June 30,							Six Months Ended June 30,
	2005		2004		% Variance			2005		2004		% Variance
Atlanta		71.0		67.5		5.2			70.9		67.5		4.9
Dallas		51.4		53.5		(3.9	)		52.3		52.9		(1.1	)
Los Angeles Area		75.4		71.9		5.0			73.4		72.4		1.3
Orlando		75.3		79.3		(5.0	)		77.6		77.6		0.0
Boca Raton/Ft. Lauderdale		80.3		77.0		4.3			85.2		82.0		4.0
New Orleans		73.5		75.5		(2.7	)		73.7		70.8		4.0
Minneapolis		75.5		69.4		8.8			70.5		66.0		6.8
Philadelphia		81.4		72.8		11.7			71.1		64.5		10.2
San Diego		84.0		83.3		0.9			82.8		84.8		(2.4	)
Phoenix		74.9		71.8		4.3			78.1		76.5		2.1
San Antonio		81.7		72.7		12.4			75.6		71.0		6.5
Northern New Jersey		77.1		71.1		8.4			71.1		68.0		4.6
Chicago		80.9		76.4		5.8			71.2		69.3		2.8
San Francisco Bay Area		72.9		67.5		8.0			67.6		64.6		4.6
Houston		73.1		72.0		1.5			71.2		72.8		(2.3	)
Washington DC		83.0		78.5		5.8			75.1		74.4		1.0


	ADR ($)
	Three Months Ended June 30,							Six Months Ended June 30,
	2005		2004		% Variance			2005		2004		% Variance
Atlanta		91.09		86.04		5.9			91.12		87.53		4.1
Dallas		94.11		90.60		3.9			94.84		90.74		4.5
Los Angeles Area		117.32		111.17		5.5			115.94		109.28		6.1
Orlando		83.64		75.20		11.2			89.44		79.41		12.6
Boca Raton/Ft. Lauderdale		120.37		107.17		12.3			141.19		124.07		13.8
New Orleans		135.87		144.35		(5.9	)		141.58		145.94		(3.0	)
Minneapolis		123.75		123.37		0.3			123.30		121.97		1.1
Philadelphia		124.08		110.20		12.6			114.94		104.08		10.4
San Diego		138.43		124.69		11.0			130.74		119.72		9.2
Phoenix		111.95		101.45		10.3			129.83		120.55		7.7
San Antonio		91.24		87.15		4.7			88.85		86.08		3.2
Northern New Jersey		139.54		136.78		2.0			136.97		135.52		1.1
Chicago		120.46		108.45		11.1			110.18		102.09		7.9
San Francisco Bay Area		114.74		114.24		0.4			112.88		111.28		1.4
Houston		72.65		67.98		6.9			71.37		71.11		0.4
Washington DC		147.80		127.60		15.8			147.86		126.82		16.6


	RevPAR ($)
	Three Months Ended June 30,							Six Months Ended June 30,
	2005		2004		% Variance			2005		2004		% Variance
Atlanta		64.67		58.04		11.4			64.57		59.11		9.2
Dallas		48.38		48.46		(0.2	)		49.63		48.03		3.3
Los Angeles Area		88.51		79.88		10.8			85.08		79.12		7.5
Orlando		63.02		59.65		5.7			69.45		61.64		12.7
Boca Raton/Ft. Lauderdale		96.71		82.54		17.2			120.33		101.72		18.3
New Orleans		99.82		109.04		(8.5	)		104.36		103.39		0.9
Minneapolis		93.43		85.62		9.1			86.93		80.52		8.0
Philadelphia		100.97		80.25		25.8			81.71		67.13		21.7
San Diego		116.35		103.87		12.0			108.23		101.58		6.6
Phoenix		83.87		72.86		15.1			101.46		92.24		10.0
San Antonio		74.58		63.39		17.6			67.20		61.13		9.9
Northern New Jersey		107.52		97.21		10.6			97.42		92.19		5.7
Chicago		97.45		82.91		17.5			78.48		70.77		10.9
San Francisco Bay Area		83.64		77.10		8.5			76.31		71.91		6.1
Houston		53.07		48.93		8.5			50.80		51.78		(1.9	)
Washington DC		122.75		100.11		22.6			111.10		94.36		17.7

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Other Performance Statistics
(Consolidated hotels included in continuing operations, for period presented)

Variance to Prior Year


	Occupancy			ADR			RevPAR
	% Variance			% Variance			% Variance
2002:
First Quarter		(11.2	)		(7.8	)		(18.2	)

Second Quarter		(5.1	)		(6.3	)		(11.1	)

Third Quarter		2.4			(4.8	)		(2.4	)

Fourth Quarter		4.4			(1.3	)		3.1

Year 2002		(2.8	)		(5.5	)		(8.1	)

2003:
First Quarter		(1.2	)		(4.1	)		(5.3	)

Second Quarter		(3.0	)		(4.8	)		(7.6	)

Third Quarter		0.3			(2.7	)		(2.4	)

Fourth Quarter		0.6			(2.3	)		(1.7	)

Year 2003		(0.6	)		(3.8	)		(4.4	)

2004:
First Quarter		5.2			(0.7	)		4.4

Second Quarter		5.5			1.7			7.3

Third Quarter		1.9			2.7			4.6

Fourth Quarter		0.9			2.9			3.9

Year 2004		3.1			1.7			4.9

2005:
January		1.9			5.1			7.1
February		0.8			6.2			7.0
March		0.4			5.2			5.7

First Quarter		1.0			5.6			6.7

April		6.3			5.4			12.0
May		2.1			6.2			8.5
June		2.6			5.5			8.3

Second Quarter		3.7			5.7			9.6

Estimated July 2005								8.0

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Hotel Portfolio Information

Pro Rata Share of Rooms Owned


			Room Count at
	Hotels		June 30, 2005
Consolidated hotels in continuing operations^(a)		133		38,128
Hotels held for sale		2		519
Unconsolidated hotel operations		5		761

Total hotels owned		140		39,408
50% and 51% joint ventures		22		(2,744	)
60% joint ventures		2		(390	)
75% joint ventures		1		(55	)
90% joint ventures		6		(148	)
97% joint venture		1		(10	)

Total joint venture owned rooms				(3,347	)

Pro rata share of rooms owned				36,061


(a)		Three limited service hotels have been excluded from the operating statistics on pages 17 - 19 of this supplemental information. Two of these hotels were surrendered to their non-recourse mortgage lender in July 2005, and the final hotel is expected to be surrendered in the third quarter of 2005. Under generally accepted accounting principles, hotels to be disposed of other than by sale are to be included in continuing operations until the actual disposition date.

Capital Expenditures (dollars in thousands)


	Three Months Ended			Six Months Ended			Year Ended
	June 30, 2005			June 30, 2005			December 31, 2004
Consolidated hotels:
Improvements and additions to hotels		24,042			50,037			95,833
% of total revenue		7.2	%		7.9	%		7.6	%

Unconsolidated hotels (pro rata share):
Improvements and additions to hotels		2,773			5,645			6,359
% of total revenue		6.6	%		7.3	%		4.3	%

As of June 30, 2005, we have incurred $6.5 million of capital expenditures associated with our condominium development project in Myrtle Beach, South Carolina.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Hotel Portfolio Information (continued)

Sale Hotels

At June 30, 2005, we included in continuing operations 13 hotels that we are actively marketing for sale. The composition, by brand, of the 13 sale hotels is as follows: Holiday Inn-branded (8), Doubletree branded (2) Embassy Suites Hotel (2), and Hampton Inn (1).

Operating statistics for our consolidated portfolio of 130 hotels included in continuing operations:


	Three Months Ended June 30,						Six Months Ended June 30,
	2005		2004		% Variance		2005		2004		% Variance
Consolidated in Continuing Operations (130 hotels)
Occupancy (%)		72.1		69.5		3.7		68.9		67.4		2.3
ADR ($)		106.57		100.83		5.7		106.27		100.50		5.7
RevPAR ($)		76.83		70.12		9.6		73.23		67.69		8.2

Sale Hotels (13 hotels)
Occupancy (%)		64.1		62.4		2.8		61.1		59.0		3.7
ADR ($)		77.25		72.67		6.3		75.65		71.78		5.4
RevPAR ($)		49.54		45.32		9.3		46.25		42.33		9.3

Core Hotels (117 hotels)
Occupancy (%)		73.0		70.3		3.8		69.8		68.3		2.2
ADR ($)		109.39		103.55		5.6		109.20		103.21		5.8
RevPAR ($)		79.82		72.83		9.6		76.19		70.46		8.1

For the quarter and six months ended June 30, 2005, the hotel operating margins for the Core Hotels were 23% and 22 %, respectively, while the operating margins for the Sale Hotels were 19% and 15%, respectively.

Portfolio Changes in 2005

Dispositions:

	•		In January 2005 we disposed of the 191-room Holiday Inn in Salt Lake City, Utah, for gross proceeds of $1.2 million.

	•		In April 2005 we disposed of the 181-room Olive Branch Whispering Woods Hotel and Conference Center for gross proceeds of $9.0 million.

	•		In May 2005 we disposed of the 216-room Holiday Inn and the 110-room Holiday Inn Express in Moline, Illinois, for gross proceeds of $3.3 million.

	•		In May and June 2005, five limited service hotels owned by a consolidated joint venture were surrendered to their non-recourse mortgage holders. Two of the remaining three hotels were surrendered to their non-recourse mortgage holder in July. The remaining hotel is expected to be surrendered in the third quarter.

	•		In July 2005, we disposed of the 222-room Holiday Inn in Jackson, Mississippi, for gross proceeds of $3.1 million.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Hotel Portfolio Information (continued)

Portfolio Changes in 2004

Acquisitions:

•

In March 2004, we purchased the 132-room Santa Monica Holiday Inn for $27 million. This hotel has a premier location across from the Santa Monica Pier and the Santa Monica beaches and will continue to be operated as a full service upscale hotel. This hotel is classified as an upscale hotel by STR because of the high room rates charged in this market.

Dispositions:

•

In 2004 we sold 17 non-strategic hotels for gross proceeds of approximately $157 million.

•

On June 30, 2004, we transferred our leasehold interest in the San Francisco Holiday Inn Select Downtown & Spa to the lessor.

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Hotel Portfolio Listing
(as of June 30, 2005)

State

Rooms

% Owned^(a)

Brand

Consolidated Continuing Operations

Birmingham^(b)

242

Embassy Suites Hotel

Montgomery — East I-85^(b)

210

Holiday Inn

Phoenix — Biltmore^(b)

232

Embassy Suites Hotel

Phoenix Crescent Hotel^(b)

342

Sheraton

Phoenix Scottsdale/Downtown^(b)(c)

218

Fairfield Inn

Phoenix Tempe^(b)

224

Embassy Suites Hotel

Dana Point — Doheny Beach

195

Doubletree Guest Suites

Irvine — Orange County Airport (Newport Beach)

335

Crowne Plaza

Los Angeles — Anaheim (Located near Disneyland Park)^(b)

222

Embassy Suites Hotel

Los Angeles — Covina/I-10^(b)

202

Embassy Suites Hotel

Los Angeles — El Segundo — International Airport - South

349

Embassy Suites Hotel

Milpitas — Silicon Valley^(b)

266

Embassy Suites Hotel

Milpitas — San Jose-North (Milpitas — Silicon Valley)

305

Crowne Plaza

Napa Valley^(b)

205

Embassy Suites Hotel

Oxnard — Mandalay Beach Resort & Conference Center^(b)

248

Embassy Suites Hotel

Palm Desert — Palm Desert Resort^(b)

198

Embassy Suites Hotel

Pleasanton (San Ramon Area)

244

Crowne Plaza

San Diego — On the Bay

600

Holiday Inn

San Francisco — Burlingame Airport

340

Embassy Suites Hotel

San Francisco — South San Francisco Airport^(b)

312

Embassy Suites Hotel

San Francisco — Fisherman’s Wharf

585

Holiday Inn

San Francisco — Union Square

403

Crowne Plaza

San Rafael — Marin County/Conference Center^(b)

235

Embassy Suites Hotel

Santa Barbara — Goleta^(b)

160

Holiday Inn

Santa Monica — Beach at the Pier

132

Holiday Inn

Denver — Aurora^(b)

248

Doubletree

Stamford

380

Holiday Inn Select

Wilmington^(b)

244

Doubletree

Boca Raton^(b)

263

Embassy Suites Hotel

Cocoa Beach — Oceanfront

500

Holiday Inn

Deerfield Beach — Boca Raton/Deerfield Beach Resort^(b)

244

Embassy Suites Hotel

Ft. Lauderdale — 17th Street^(b)

358

Embassy Suites Hotel

Ft. Lauderdale — Cypress Creek^(b)

253

Sheraton Suites

Jacksonville — Baymeadows^(b)

277

Embassy Suites Hotel

Miami — International Airport^(b)

316

Embassy Suites Hotel

Miami — International Airport (LeJeune Center)

304

Crowne Plaza

Orlando — International Airport^(b)

288

Holiday Inn Select

Orlando — International Drive — Resort^(b)

651

Holiday Inn

Orlando — International Drive South/Convention Center^(b)

244

Embassy Suites Hotel

Orlando - Nikki Bird (Maingate — Walt Disney World Area)

530

Holiday Inn

FelCor Lodging Trust Incorporated

Supplemental Information
Three and Six Months Ended June 30, 2005

Hotel Portfolio Listing
(as of June 30, 2005)

State

Rooms

% Owned^(a)

Brand

Orlando — (North)

277

Embassy Suites Hotel

Orlando — Walt Disney World Resort^(b)

229

Doubletree Guest Suites

Tampa — Busch Gardens

406

Holiday Inn

Tampa — On Tampa Bay^(b)

203

Doubletree Guest Suites

Atlanta — Airport^(b)

378

Crowne Plaza

Atlanta — Airport^(b)

233

Embassy Suites Hotel

Atlanta — Airport-North^(b)

493

Holiday Inn

Atlanta — Buckhead^(b)

317

Embassy Suites Hotel

Atlanta — Downtown^(b)(d)

211

Courtyard by Marriott

Atlanta — Downtown^(b)(d)

242

Fairfield Inn

Atlanta — Galleria^(b)

278

Sheraton Suites

Atlanta — Gateway — Atlanta Airport

395

Sheraton

Atlanta — Perimeter — Dunwoody^(b)

250

Holiday Inn Select

Atlanta — Perimeter Center^(b)

241

Embassy Suites Hotel

Atlanta — Powers Ferry^(b)

296

Crowne Plaza

Atlanta — South (I-75 & US 41)^(b)

180

Holiday Inn

Brunswick^(b)

130

Embassy Suites Hotel

Columbus — North (I-185 at Peachtree Mall)

224

Holiday Inn

Davenport

288

Holiday Inn

Chicago — The Allerton

443

Crowne Plaza

Chicago — Lombard/Oak Brook^(b)

262

Embassy Suites Hotel

Chicago — Northshore/Deerfield (Northbrook)^(b)

237

Embassy Suites Hotel

Chicago O’Hare Airport^(b)

297

Sheraton Suites

Indianapolis — North^(b)

221

Embassy Suites Hotel

Kansas City — Overland Park^(b)

199

Embassy Suites Hotel

Lexington^(b)

155

Sheraton Suites

Lexington — Lexington Green^(b)

174

Hilton Suites

Baton Rouge^(b)

223

Embassy Suites Hotel

New Orleans^(b)

372

Embassy Suites Hotel

New Orleans — French Quarter^(b)

374

Holiday Inn

Boston — Government Center

303

Holiday Inn Select

Boston — Marlborough^(b)

229

Embassy Suites Hotel

Baltimore — BWI Airport^(b)

251

Embassy Suites Hotel

Troy — North (Auburn Hills)^(b)

251

Embassy Suites Hotel

Bloomington^(b)

219

Embassy Suites Hotel

Minneapolis — Airport^(b)

310

Embassy Suites Hotel

Minneapolis — Downtown

216

Embassy Suites Hotel

St. Paul — Downtown^(b)

210

Embassy Suites Hotel

Kansas City — NE I-435 North (At Worlds of Fun)^(b)

165

Holiday Inn

Kansas City — Plaza^(b)

266

Embassy Suites Hotel

Charlotte^(b)

274

Embassy Suites Hotel

Charlotte SouthPark

208

Doubletree Guest Suites

Raleigh^(b)

203

Doubletree Guest Suites

Raleigh — Crabtree^(b)

225

Embassy Suites Hotel

Omaha — Central

187

Doubletree Guest Suites

Omaha — Central

129

Hampton Inn

Omaha — Central (I-80)

383

Holiday Inn

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Hotel Portfolio Listing
(as of June 30, 2005)

State

Rooms

% Owned^(a)

Brand

Omaha — Old Mill^(b)

223

Crowne Plaza

Parsippany^(b)

274

Embassy Suites Hotel

Piscataway — Somerset^(b)

224

Embassy Suites Hotel

Secaucus — Meadowlands^(b)

261

Embassy Suites Hotel

Cleveland — Downtown

268

Embassy Suites Hotel

Tulsa — I-44^(b)

244

Embassy Suites Hotel

Philadelphia — Center City

445

Crowne Plaza

Philadelphia — Historic District^(b)

364

Holiday Inn

Philadelphia — Society Hill^(b)

365

Sheraton

Pittsburgh — At University Center (Oakland)^(b)

251

Holiday Inn Select

Charleston — Mills House (Historic Downtown)^(b)

214

Holiday Inn

Myrtle Beach — At Kingston Plantation

255

Embassy Suites Hotel

Myrtle Beach Resort

385

Hilton

Knoxville — Central At Papermill Road^(b)

240

Holiday Inn

Nashville — Airport/Opryland Area

296

Embassy Suites Hotel

Nashville — Opryland/Airport (Briley Parkway)

382

Holiday Inn Select

Amarillo — I-40

248

Holiday Inn

Austin^(b)

189

Doubletree Guest Suites

Austin — North^(b)

260

Embassy Suites Hotel

Austin — Town Lake (Downtown Area)^(b)

320

Holiday Inn

Corpus Christi^(b)

150

Embassy Suites Hotel

Dallas

295

Crowne Plaza Suites

Dallas — At Campbell Centre

300

Doubletree

Dallas — Dallas Park Central

114

Staybridge Suites

Dallas — DFW International Airport-North^(b)

164

Harvey Suites

Dallas — DFW International Airport-South^(b)

305

Embassy Suites Hotel

Dallas — Love Field^(b)

248

Embassy Suites Hotel

Dallas — Market Center^(b)

354

Crowne Plaza

Dallas — Market Center^(b)

244

Embassy Suites Hotel

Dallas — Park Central

438

Sheraton

Dallas — Park Central

536

Westin

Dallas — Park Central Area^(b)

279

Embassy Suites Hotel

Dallas — West End/Convention Center

309

Hampton Inn

Houston — Greenway Plaza Area^(b)

355

Holiday Inn Select

Houston — I-10 West & Hwy. 6 (Park 10 Area)

349

Holiday Inn Select

Houston — Intercontinental Airport^(b)

415

Holiday Inn

Houston — Medical Center^(b)

284

Holiday Inn & Suites

San Antonio — Downtown (Market Square)

315

Holiday Inn

San Antonio — International Airport^(b)

261

Embassy Suites Hotel

San Antonio — International Airport^(b)

397

Holiday Inn Select

San Antonio — N.W. I-10^(b)

216

Embassy Suites Hotel

Waco — I-35

170

Holiday Inn

Burlington Hotel & Conference Center^(b)

309

Sheraton

Vienna — At Tysons Corner^(b)

437

Sheraton

FelCor Lodging Trust Incorporated
Supplemental Information
Three and Six Months Ended June 30, 2005

Hotel Portfolio Listing
(as of June 30, 2005)

State

Rooms

% Owned^(a)

Brand

Canada

Toronto — Airport

Ontario

445

Holiday Inn Select

Toronto — Yorkdale

Ontario

370

Holiday Inn

Hotel Held for Sale

St. Louis — Downtown

297

Embassy Suites Hotel

Jackson — North ^(e)

222

Holiday Inn & Suites

Unconsolidated Operations

Hays^(b)

114

Hampton Inn

Hays^(b)

191

Holiday Inn

Salina^(b)

192

Holiday Inn

Salina — I-70^(b)

Holiday Inn Express & Suites

New Orleans — Chateau LeMoyne (In French

Quarter/Historic Area)^(b)

171

Holiday Inn


(a)		We own 100% of the real estate interests unless otherwise noted.

(b)		This hotel is encumbered by mortgage debt or capital lease obligation.

(c)		We currently expect to surrender this hotel to the non-recourse debt holder in the third quarter 2005.

(d)		We surrendered this hotel to the non-recourse debt holder in July 2005.

(e)		This hotel was sold in July 2005.

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