FelCor Repaying $177 Million of Debt at Substantial Discount; RevPAR and EBITDA Significantly Ahead of Expectations
08 Junho 2010 - 5:40PM
Business Wire
FelCor Lodging Trust Incorporated (NYSE: FCH) today announced
that it has agreed to repay $177 million of secured debt at a
significant discount to the principal balance. The two loans bear
interest at LIBOR plus 155 basis points and are scheduled to mature
in May 2012. The loans will be settled for $130 million, plus
accrued interest, representing a 27% discount to the principal
balance. The two hotels that secure the loans have a combined 921
guest rooms and more than 100,000 square feet of meeting space. The
payment, approximately $141,000 per room, will be funded with cash
on hand and reflects a substantial discount to replacement
cost.
Revenue per available room (“RevPAR”) for our 83 consolidated
hotels increased 8.0% during May and 5.2% during the first two
months of the quarter, compared to the same period in 2009, which
was significantly better than the company’s expectations. The
positive flow-through to EBITDA on the improvement to budgeted
revenue remains very strong. As a result, Adjusted EBITDA and Net
loss for the two months ending May 31, 2010 were significantly
better than the high end of expectations and are trending above
current analysts’ expectations for the quarter.
“The lodging industry’s recovery continues to accelerate and has
been more robust than we anticipated, leading to much stronger than
expected RevPAR. Our diversified, well-located and high-quality
portfolio continues to outperform the industry,” said Richard A.
Smith, FelCor’s President and Chief Executive Officer. “We remain
committed to looking for opportunities that will strengthen our
balance sheet and improve shareholder value. This repayment, at a
discount of nearly $50 million, allows us to reduce our leverage
substantially and unencumber two hotels, which makes tremendous
sense for our shareholders,” added Mr. Smith.
Adjusted EBITDA is derived by adding depreciation and
amortization, amortization of stock compensation, interest expense,
and noncontrolling interest in other partnerships to net loss.
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. 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. We undertake no obligation to update any
forward-looking statement to conform the statement to actual
results or changes in our expectations.
FelCor, a real estate investment trust, is the nation’s largest
owner of upper upscale, all-suite hotels. FelCor owns interests in
84 hotels and resorts, located in 23 states and Canada. FelCor’s
portfolio consists mostly of upper upscale hotels, which are
flagged under global brands - Embassy Suites Hotels®, Doubletree®,
Hilton®, Marriott®, Renaissance®, Sheraton®, Westin® and Holiday
Inn®. Additional information can be found on the Company’s Web site
at www.felcor.com.
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