Extended Stay America, Inc. (NYSE:STAY) today announced consolidated results for the three and six months ended June 30, 2017.
Second Quarter 2017 Highlights
- Comparable Hotel2 Revenue Per Available Room (“RevPAR”) grew 2.4% to $53.04
- Net Income of $49.7 million
- Adjusted EBITDA increased 5.0% to $172.8 million
- Adjusted Paired Share Income1 per diluted Paired Share of $0.31
Six Months 2017 Highlights
- Comparable Hotel RevPAR grew 2.3% to $49.44
- Net Income of $65.8 million
- Adjusted EBITDA increased 5.2% to $302.5 million
- Adjusted Paired Share Income per diluted Paired Share of $0.46
The Company’s Chief Executive Officer, Gerry Lopez, commented, “We were pleased with our results in the second quarter. Margin expansion combined with our steady RevPAR increase allowed us to once again deliver strong adjusted EBITDA growth and our third quarter in a row of triple-digit flow-through.”
Mr. Lopez continued, “With our renovation program completed in May, we now turn our focus towards ESA 2.0 – asset sales, franchised new builds as well as owned and operated new builds. We are very excited about the interest we’ve received since our announcement and kickoff at the NYU Hospitality Conference in early June, and are currently in negotiations with a significant number of parties for both hotel block sales as well as deals to build a significant number of new franchised ESA hotels. We are also pressing forward with ESA owned development, with 4 signed purchase agreements for land for owned balance sheet development in 2018 and 2019.”
Financial and Operating Results
Total revenues for the three months ended June 30, 2017 increased 1.7% over the same period in 2016 to $338.4 million. Total revenues were impacted by the sale of four hotels in early May 2017 with approximately $2.6 million less revenue than the same period in 2016. Total revenues for the six months ended June 30, 2017 grew 1.5% to $629.4 million.
Comparable Hotel RevPAR for the three months ended June 30, 2017 grew 2.4% over the same period in 2016, driven by an improvement in occupancy of 220 basis points to 78.9% while Average Daily Rate (“ADR”) declined slightly by 0.5%. Comparable Hotel RevPAR for the six months ended June 30, 2017 grew 2.3% to $49.44 driven by a 150 basis point increase in occupancy and a 0.2% increase in ADR compared to the same period in 2016.
Hotel Operating Margin for the three months ended June 30, 2017 was 56.7% compared to 55.8% in the same period in 2016. Hotel Operating Margin flow-through, defined as the change in Hotel Operating Profit1 divided by the change in total hotel revenues, was 110.9%. Hotel Operating Margin for the six months ended June 30, 2017 expanded 150 basis points to 54.8% on 156.4% Hotel Operating Margin flow-through.
Net income for the three months ended June 30, 2017 was $49.7 million compared to $61.4 million in the same period in 2016. Net income during the quarter was impacted by a non-cash impairment charge of $7.9 million, a $1.9 million loss on four properties sold in May 2017 and a sharp increase in income tax expense due to a one-time favorable impact to our tax rate in the same period in 2016, partially offset by an increase in other income. Income tax expense for the three months ended June 30, 2017 was $15.9 million compared to $7.4 million in the same period in 2016. Net income for the six months ended June 30, 2017 was $65.8 million compared to $76.1 million in the same period in 2016. Income tax expense for the six months ended June 30, 2017 was $20.4 million compared to $10.3 million in the same period in 2016.
Adjusted EBITDA for the three months ended June 30, 2017 increased 5.0% over the same period in 2016 to $172.8 million. Adjusted EBITDA, a non-GAAP measure, excludes equity-based compensation of $3.6 million, non-cash impairment charge of $7.9 million, $1.9 million loss on sale of hotel properties and other net expenses of $4.2 million. This quarterly result comes after an estimated lost contribution of $1.5 million related to four hotels sold in early May 2017 for the remainder of the quarter compared to the prior year period. Adjusted EBITDA for the six months ended June 30, 2017 increased 5.2% over the same period in 2016 to $302.5 million.
Adjusted Funds From Operations (“FFO”)1 for the three months ended June 30, 2017 was $101.9 million, a decrease of 1.6% from the same period in 2016. Adjusted FFO fell due to a significantly lower tax rate in the same period in 2016 related to a one-time favorable income tax adjustment. Adjusted FFO for the three months ended June 30, 2017 per diluted Paired Share was $0.53 compared to $0.51 in the same period in 2016. Adjusted FFO, a non-GAAP measure, represents FFO1, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share. A Paired Share entitles its holder to participate in 100% of the common equity and earnings of both Extended Stay America, Inc. and ESH Hospitality, Inc. Adjusted FFO for the six months ended June 30, 2017 was $170.6 million compared to $167.9 million in the same period in 2016. Adjusted FFO per Paired Share for the first half of 2017 was $0.88 compared to $0.83 in the same period in 2016.
Adjusted Paired Share Income for the three months ended June 30, 2017 was $60.5 million, or $0.31 per diluted Paired Share, compared to $63.0 million, or $0.31 per diluted Paired Share, in the same period in 2016. Adjusted Paired Share Income, a non-GAAP measure, represents net income, as adjusted, attributable to the consolidated enterprise, whose representative equity security is a Paired Share. Adjusted Paired Share Income for the six months ended June 30, 2017 was $89.0 million compared to $88.8 million while Adjusted Paired Share Income per diluted Paired Share increased to $0.46 from $0.44 in the same period in 2016.
Capital Expenditures
The Company invested $44.6 million in capital expenditures during the second quarter of 2017 which includes $10.0 million in renovation capital and $33.2 million in maintenance capital. The Company completed 17 hotel renovations in the second quarter of 2017, with all 625 hotels having now been renovated.
Distribution and Share Repurchases
On August 1, 2017, the Boards of Directors of Extended Stay America, Inc. and ESH Hospitality, Inc., declared cash distributions totaling $0.21 per Paired Share for the second quarter of 2017. The distribution is comprised of $0.07 per Extended Stay America, Inc. common share and $0.14 per ESH Hospitality, Inc. Class A and B common share. The distributions are payable on August 29, 2017 to shareholders of record as of August 15, 2017.
During the quarter, the Company paid approximately $30.9 million to repurchase and retire approximately 1.8 million Paired Shares. The Company had approximately $106.3 million remaining for repurchases under the combined Paired Share repurchase program as of June 30, 2017.
2017 Outlook
The Company’s outlook for 2017 is updated as follows:
| Full Year 2017 | Updated Outlook | Previous Outlook | |||||||||||||||||
| in millions, except % | Low | High | Low | High | |||||||||||||||
| Total Revenues | $ | 1,278 | $ | 1,303 | $ | 1,285 | $ | 1,310 | |||||||||||
| Comparable RevPAR % ? | 1.5 | % | 3.5 | % | 1.5 | % | 3.5 | % | |||||||||||
| Net Income | $ | 161 | $ | 174 | $ | 175 | $ | 188 | |||||||||||
| Adjusted EBITDA | $ | 620 | $ | 635 | $ | 625 | $ | 640 | |||||||||||
| Adjusted EBITDA % ? |
|
0.7 |
% |
|
3.1 |
% |
|
1.5 |
% |
|
4.0 |
% |
|||||||
| Depreciation and Amortization | $ | 233 | $ | 233 | $ | 233 | $ | 233 | |||||||||||
| Net Interest Expense | $ | 130 | $ | 130 | $ | 130 | $ | 130 | |||||||||||
| Effective Tax Rate | 23 | % | 24 | % | 23 | % | 24 | % | |||||||||||
| Capital Expenditures | $ | 150 | $ | 180 | $ | 150 | $ | 180 | |||||||||||
The Company’s updated outlook reflects the lost hotel contribution related to four hotels sold in early May 2017 for the remainder of 2017, estimated at approximately $5 million of Adjusted EBITDA.
About Extended Stay America
Extended Stay America, Inc. (“ESA”) is the largest integrated hotel owner/operator in North America. Its subsidiary, ESH Hospitality, Inc. (“ESH”), is the largest lodging REIT in North America by unit and room count, with over 620 hotels and approximately 68,000 rooms in the U.S. ESA manages all of ESH’s hotel properties, providing over 8,000 jobs at hotel properties and corporate headquarters. Extended Stay America® is the leading brand in the mid-priced extended stay segment, with approximately twice as many rooms as its nearest competitor.
| EXTENDED STAY AMERICA, INC. | ||||||||||||||||||||||
| CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||||||||
| FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017 AND 2016 | ||||||||||||||||||||||
| (In thousands) | ||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||
| June 30, | June 30, | |||||||||||||||||||||
| 2017 | 2016 | % Variance | 2017 | 2016 | % Variance | |||||||||||||||||
| REVENUES: | ||||||||||||||||||||||
| $ | 332,608 | $ | 327,833 | 1.5% | Room revenues | $ | 618,416 | $ | 610,970 | 1.2% | ||||||||||||
| 5,755 | 4,956 | 16.1% | Other hotel revenues | 10,938 | 9,377 | 16.6% | ||||||||||||||||
| 338,363 | 332,789 | 1.7% | Total revenues | 629,354 | 620,347 | 1.5% | ||||||||||||||||
| OPERATING EXPENSES: | ||||||||||||||||||||||
| 148,911 | 149,078 | (0.1)% | Hotel operating expenses | 290,571 | 294,638 | (1.4)% | ||||||||||||||||
| 25,430 | 23,988 | 6.0% | General and administrative expenses | 51,737 | 48,940 | 5.7% | ||||||||||||||||
| 57,804 | 55,011 | 5.1% | Depreciation and amortization | 115,475 | 108,319 | 6.6% | ||||||||||||||||
| 7,934 | - | n/a | Impairment of long-lived assets | 20,357 | - | n/a | ||||||||||||||||
| 240,079 | 228,077 | 5.3% | Total operating expenses | 478,140 | 451,897 | 5.8% | ||||||||||||||||
| (1,897 | ) | - | n/a | LOSS ON SALE OF HOTEL PROPERTIES | (1,897 | ) | - | n/a | ||||||||||||||
| 2,055 | - | n/a | OTHER INCOME | 2,056 | 18 | 11,322.2% | ||||||||||||||||
| 98,442 | 104,712 | (6.0)% | INCOME FROM OPERATIONS | 151,373 | 168,468 | (10.1)% | ||||||||||||||||
| 1,073 | 114 | 841.2% | OTHER NON-OPERATING EXPENSE (INCOME) | (148 | ) | (764 | ) | (80.6)% | ||||||||||||||
| 31,701 | 35,764 | (11.4)% | INTEREST EXPENSE, NET | 65,307 | 82,749 | (21.1)% | ||||||||||||||||
| 65,668 | 68,834 | (4.6)% | INCOME BEFORE INCOME TAX EXPENSE | 86,214 | 86,483 | (0.3)% | ||||||||||||||||
| 15,943 | 7,448 | 114.1% | INCOME TAX EXPENSE | 20,426 | 10,344 | 97.5% | ||||||||||||||||
| 49,725 | 61,386 | (19.0)% | NET INCOME | 65,788 | 76,139 | (13.6)% | ||||||||||||||||
| 2,050 | (657 | ) | (412.0)% |
NET LOSS (INCOME) ATTRIBUTABLE TO NONCONTROLLING INTERESTS (1) |
9,088 | 1,636 | 455.5% | |||||||||||||||
| $ | 51,775 | $ | 60,729 | (14.7)% |
NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. COMMON SHAREHOLDERS |
$ | 74,876 | $ | 77,775 | (3.7)% | ||||||||||||
| $ | 0.27 | $ | 0.30 |
NET INCOME PER EXTENDED STAY AMERICA, INC. COMMON SHARE - DILUTED |
$ | 0.39 | $ | 0.38 | ||||||||||||||
| 193,944 | 201,689 |
WEIGHTED-AVERAGE EXTENDED STAY AMERICA, INC. COMMON SHARES OUTSTANDING - DILUTED |
194,372 | 203,029 | ||||||||||||||||||
| CONSOLIDATED BALANCE SHEET DATA | ||||||||
| AS OF JUNE 30, 2017 AND DECEMBER 31, 2016 | ||||||||
| (In thousands) | ||||||||
| (Unaudited) | ||||||||
| June 30, | December 31, | |||||||
| 2017 | 2016 | |||||||
| Cash and cash equivalents | $ | 56,232 | $ | 84,158 | ||||
| Restricted cash | $ | 21,325 | $ | 21,614 | ||||
| Total assets | $ | 4,071,151 | $ | 4,180,304 | ||||
|
Total debt, net of unamortized deferred financing costs and debt discounts (2) |
$ | 2,544,643 | $ | 2,606,476 | ||||
| Total equity | $ | 1,325,029 | $ | 1,377,239 | ||||
| EXTENDED STAY AMERICA, INC. | ||||||||||||||||||||||||
| COMPARABLE HOTEL OPERATING METRICS (1) | ||||||||||||||||||||||||
| FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017 AND 2016 | ||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||
| June 30, | June 30, | |||||||||||||||||||||||
| 2017 | 2016 | Variance | 2017 | 2016 | Variance | |||||||||||||||||||
| 625 | 625 | - | Number of hotels | 625 | 625 | - | ||||||||||||||||||
| 68,780 | 68,780 | - | Number of rooms | 68,780 | 68,780 | - | ||||||||||||||||||
| 78.9 | % | 76.7 | % | 220 bps | Comparable Hotel Occupancy | 74.7 | % | 73.2 | % | 150 bps | ||||||||||||||
| $ | 67.21 | $ | 67.53 | (0.5 | )% | Comparable Hotel ADR | $ | 66.15 | $ | 66.04 | 0.2 | % | ||||||||||||
| $ | 53.04 | $ | 51.81 | 2.4 | % | Comparable Hotel RevPAR | $ | 49.44 | $ | 48.31 | 2.3 | % | ||||||||||||
| Comparable Hotel Inventory: | ||||||||||||||||||||||||
| 625 | 530 | 95 | Renovated Extended Stay America | 625 | 530 | 95 | ||||||||||||||||||
| - | 95 | (95 | ) | Unrenovated Extended Stay America | - | 95 | (95 | ) | ||||||||||||||||
| 625 | 625 | - | Comparable Hotel number of hotels | 625 | 625 | - | ||||||||||||||||||
|
Comparable Hotel Renovation Displacement Data (in thousands, except percentages): |
||||||||||||||||||||||||
| 6,279 | 6,316 | (37 | ) | Comparable Hotel available room nights | 12,523 | 12,632 | (109 | ) | ||||||||||||||||
| 8 | 57 | (49 | ) |
Comparable Hotel room nights displaced from renovation |
97 | 179 | (82 | ) | ||||||||||||||||
| 0.1 | % | 0.9 | % | (80) bps | % of Comparable Hotel available room nights displaced | 0.8 | % | 1.4 | % | (60) bps | ||||||||||||||
|
EXTENDED STAY AMERICA, INC. |
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|
NON-GAAP RECONCILIATION OF ROOM REVENUES, OTHER HOTEL REVENUES AND |
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|
HOTEL OPERATING EXPENSES TO HOTEL OPERATING PROFIT AND HOTEL OPERATING MARGIN |
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|
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017 AND 2016 |
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|
(In thousands) |
||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||
| June 30, | June 30, | |||||||||||||||||||||||
| 2017 | 2016 | Variance | 2017 | 2016 | Variance | |||||||||||||||||||
| $ | 332,608 | $ | 327,833 | 1.5 | % | Room revenues | $ | 618,416 | $ | 610,970 | 1.2 | % | ||||||||||||
| 5,755 | 4,956 | 16.1 | % | Other hotel revenues | 10,938 | 9,377 | 16.6 | % | ||||||||||||||||
| 338,363 | 332,789 | 1.7 | % | Total hotel revenues | 629,354 | 620,347 | 1.5 | % | ||||||||||||||||
| 146,363 | 146,973 | (0.4 | )% | Hotel operating expenses(1) | 284,553 | 289,637 | (1.8 | )% | ||||||||||||||||
| $ | 192,000 | $ | 185,816 | 3.3 | % | Hotel Operating Profit | $ | 344,801 | $ | 330,710 | 4.3 | % | ||||||||||||
| 56.7 | % | 55.8 | % | 90 bps | Hotel Operating Margin | 54.8 | % | 53.3 | % | 150 bps | ||||||||||||||
| EXTENDED STAY AMERICA, INC. | |||||||||||||||||||||
| NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA | |||||||||||||||||||||
| FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017 AND 2016 | |||||||||||||||||||||
| (In thousands) | |||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||||||||
| June 30, | June 30, | ||||||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | ||||||||||||||||||
| $ | 49,725 | $ | 61,386 | Net income | $ | 65,788 | $ | 76,139 | |||||||||||||
| 31,701 | 35,764 | Interest expense, net | 65,307 | 82,749 | |||||||||||||||||
| 15,943 | 7,448 | Income tax expense | 20,426 | 10,344 | |||||||||||||||||
| 57,804 | 55,011 | Depreciation and amortization | 115,475 | 108,319 | |||||||||||||||||
| 155,173 | 159,609 | EBITDA | 266,996 | 277,551 | |||||||||||||||||
| 3,646 | 2,939 | Equity-based compensation | 6,329 | 5,619 | |||||||||||||||||
| 1,073 |
(1) |
114 |
(2) |
Other non-operating expense (income) | (148 | ) |
(3) |
(764 | ) |
(4) |
|||||||||||
| 7,934 | - | Impairment of long-lived assets | 20,357 | - | |||||||||||||||||
| 1,897 | - | Loss on sale of hotel properties | 1,897 | - | |||||||||||||||||
| 3,125 |
(5) |
1,997 |
(6) |
Other expenses | 7,019 |
(7) |
5,052 |
(8) |
|||||||||||||
| $ | 172,848 | $ | 164,659 | Adjusted EBITDA | $ | 302,450 | $ | 287,458 | |||||||||||||
| 5.0 | % | % growth | 5.2 | % | |||||||||||||||||
|
(1) |
Includes loss related to interest rate swap of approximately $1.5 million and foreign currency transaction gain of approximately $0.4 million. |
|
|
(2) |
Includes foreign currency transaction loss of approximately $0.1 million. |
|
|
(3) |
Includes foreign currency transaction gain of approximately $0.4 million and loss related to interest rate swap of approximately $0.3 million. |
|
|
(4) |
Includes foreign currency transaction gain of approximately $0.8 million. |
|
|
(5) |
Includes loss on disposal of assets of approximately $2.5 million and costs incurred in connection with the second quarter 2017 secondary offerings of approximately $0.6 million. |
|
|
(6) |
Includes loss on disposal of assets of approximately $2.1 million and transaction costs of approximately $(0.1) million due to the revision of an estimate related to the sale of 53 hotel properties in December 2015. |
|
|
(7) |
Includes loss on disposal of assets of approximately $6.0 million and costs incurred in connection with the first and second quarter 2017 secondary offerings of approximately $1.0 million. |
|
|
(8) |
Includes loss on disposal of assets of approximately $5.0 million and transaction costs of approximately $0.1 million due to the revision of an estimate related to the sale of the 53 hotel properties in December 2015. |
|
| EXTENDED STAY AMERICA, INC. | ||||||||||||||||||
| NON-GAAP RECONCILIATION OF NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. | ||||||||||||||||||
| COMMON SHAREHOLDERS TO FUNDS FROM OPERATIONS, ADJUSTED FUNDS FROM OPERATIONS | ||||||||||||||||||
|
AND ADJUSTED FUNDS FROM OPERATIONS PER DILUTED PAIRED SHARE |
||||||||||||||||||
| FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017 AND 2016 | ||||||||||||||||||
| (In thousands, expect per share and per Paired Share data) | ||||||||||||||||||
| (Unaudited) | ||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||
| June 30, | June 30, | |||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||||
| $ | 0.27 | $ | 0.30 |
Net income per Extended Stay America, Inc. common share - diluted |
$ | 0.39 | $ | 0.38 | ||||||||||
| $ | 51,775 | $ | 60,729 |
Net income attributable to Extended Stay America, Inc. common shareholders |
$ | 74,876 | $ | 77,775 | ||||||||||
| (2,054 | ) | 653 |
Noncontrolling interests attributable to Class B common shares of ESH REIT |
(9,096 | ) | (1,644 | ) | |||||||||||
| 56,649 | 53,918 | Real estate depreciation and amortization | 113,182 | 106,118 | ||||||||||||||
| 7,934 | - | Impairment of long-lived assets | 20,357 | - | ||||||||||||||
| 1,897 | - | Loss on sale of hotel properties | 1,897 | - | ||||||||||||||
| (15,423 | ) | (11,754 | ) |
Tax effect of adjustments to net income attributable to Extended Stay America, Inc. common shareholders |
(31,697 | ) | (23,708 | ) | ||||||||||
| 100,778 | 103,546 | Funds from Operations | 169,519 | 158,541 | ||||||||||||||
| - | - | Debt modification and extinguishment costs | 1,168 | 12,103 | ||||||||||||||
| 1,495 | - | Loss on interest rate swap | 253 | - | ||||||||||||||
| (347 | ) | - | Tax effect of adjustments to Funds from Operations | (330 | ) | (2,772 | ) | |||||||||||
| $ | 101,926 | $ | 103,546 | Adjusted Funds from Operations | $ | 170,610 | $ | 167,872 | ||||||||||
| $ | 0.53 | $ | 0.51 |
Adjusted Funds from Operations per Paired Share – diluted |
$ | 0.88 | $ | 0.83 | ||||||||||
| 193,944 | 201,689 |
Weighted average Paired Shares outstanding – diluted |
194,372 | 203,029 | ||||||||||||||
| EXTENDED STAY AMERICA, INC. | ||||||||||||||||||||
| NON-GAAP RECONCILIATION OF NET INCOME ATTRIBUTABLE TO EXTENDED STAY AMERICA, INC. | ||||||||||||||||||||
| COMMON SHAREHOLDERS TO PAIRED SHARE INCOME, ADJUSTED PAIRED SHARE INCOME | ||||||||||||||||||||
| AND ADJUSTED PAIRED SHARE INCOME PER DILUTED PAIRED SHARE | ||||||||||||||||||||
| FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2017 AND 2016 | ||||||||||||||||||||
| (In thousands, expect per share and per Paired Share data) | ||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||
| June 30, | June 30, | |||||||||||||||||||
| 2017 | 2016 | 2017 | 2016 | |||||||||||||||||
| $ | 0.27 | $ | 0.30 |
Net income per Extended Stay America, Inc. common share - diluted |
$ | 0.39 | $ | 0.38 | ||||||||||||
| $ | 51,775 | $ | 60,729 |
Net income attributable to Extended Stay America, Inc. common shareholders |
$ | 74,876 | $ | 77,775 | ||||||||||||
| (2,054 | ) | 653 |
Noncontrolling interests attributable to Class B common shares of ESH REIT |
(9,096 | ) | (1,644 | ) | |||||||||||||
| 49,721 | 61,382 | Paired Share Income | 65,780 | 76,131 | ||||||||||||||||
| - | - | Debt modification and extinguishment costs | 1,168 | 12,103 | ||||||||||||||||
| 1,073 |
(1) |
114 |
(2) |
Other non-operating expense (income) | (148 | ) |
(3) |
(764 | ) |
(4) |
||||||||||
| 7,934 | - | Impairment of long-lived assets | 20,357 | - | ||||||||||||||||
| 1,897 | - | Loss on sale of hotel properties | 1,897 | - | ||||||||||||||||
| 3,125 |
(5) |
1,997 |
(6) |
Other expenses | 7,019 |
(7) |
5,052 |
(8) |
||||||||||||
| (3,255 | ) | (460 | ) |
Tax effect of adjustments to Paired Share Income |
(7,093 | ) | (3,730 | ) | ||||||||||||
| $ | 60,495 | $ | 63,033 | Adjusted Paired Share Income | $ | 88,980 | $ | 88,792 | ||||||||||||
| $ | 0.31 | $ | 0.31 | Adjusted Paired Share Income per Paired Share – diluted | $ | 0.46 | $ | 0.44 | ||||||||||||
| 193,944 | 201,689 | Weighted average Paired Shares outstanding – diluted | 194,372 | 203,029 | ||||||||||||||||
|
(1) |
Includes loss related to interest rate swap of approximately $1.5 million and foreign currency transaction gain of approximately $0.4 million. |
|
|
(2) |
Includes foreign currency transaction loss of approximately $0.1 million. |
|
|
(3) |
Includes foreign currency transaction gain of approximately $0.4 million and loss related to interest rate swap of approximately $0.3 million. |
|
|
(4) |
Includes foreign currency transaction gain of approximately $0.8 million. |
|
|
(5) |
Includes loss on disposal of assets of approximately $2.5 million and costs incurred in connection with the second quarter 2017 secondary offerings of approximately $0.6 million. |
|
|
(6) |
Includes loss on disposal of assets of approximately $2.1 million and transaction costs of approximately $(0.1) million due to the revision of an estimate related to the sale of 53 hotel properties in December 2015. |
|
|
(7) |
Includes loss on disposal of assets of approximately $6.0 million and costs incurred in connection with the first and second quarter 2017 secondary offerings of approximately $1.0 million. |
|
|
(8) |
Includes loss on disposal of assets of approximately $5.0 million and transaction costs of approximately $0.1 million due to the revision of an estimate related to the sale of the 53 hotel properties in December 2015. |
|
| EXTENDED STAY AMERICA, INC. | ||||||||||||||||
| TOTAL REVENUES AND NON-GAAP RECONCILIATION OF NET INCOME TO EBITDA AND ADJUSTED EBITDA | ||||||||||||||||
| FOR THE YEARS ENDED DECEMBER 31, 2016 (ACTUAL) AND 2017 (OUTLOOK) | ||||||||||||||||
| (In thousands) | ||||||||||||||||
| (Unaudited) | ||||||||||||||||
| Year Ended | Year Ending December 31, 2017 | |||||||||||||||
| December 31, 2016 | (Outlook) | |||||||||||||||
| (Actual) | Low | High | ||||||||||||||
| $ | 1,270,593 | Total revenues | $ | 1,278,000 | $ | 1,303,000 | ||||||||||
| $ | 163,352 | Net income | $ | 160,659 | $ | 174,323 | ||||||||||
| 164,537 | Interest expense, net | 130,000 | 130,000 | |||||||||||||
| 34,351 | Income tax expense | 50,735 | 52,071 | |||||||||||||
| 221,309 | Depreciation and amortization | 232,500 | 232,500 | |||||||||||||
| 583,549 | EBITDA | 573,894 | 588,894 | |||||||||||||
| 12,000 | Equity-based compensation | 12,500 | 12,500 | |||||||||||||
| (1,576 | ) | Other non-operating income | (148 | ) | (148 | ) | ||||||||||
| 9,828 | Impairment of long-lived assets | 20,357 | 20,357 | |||||||||||||
| - | Loss on sale of hotel properties | 1,897 | 1,897 | |||||||||||||
| 11,857 |
(1) |
Other expenses | 11,500 |
(2) |
11,500 | |||||||||||
| $ | 615,658 | Adjusted EBITDA | $ | 620,000 | $ | 635,000 | ||||||||||
| % growth | 0.7 | % | 3.1 | % | ||||||||||||
| (1) |
Includes loss on disposal of assets of approximately $10.7 million, costs incurred in connection with the fourth quarter 2016 secondary offerings of approximately $1.1 million and transaction costs of approximately $0.1 million due to the revision of an estimate related to the sale of 53 hotel properties in December 2015. |
|
| (2) |
Includes loss on disposal of assets and other non-operating transaction costs. |
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