FelCor Prices Debt Offering - Analyst Blog
13 Dezembro 2012 - 9:40AM
Zacks
FelCor Lodging Trust
Inc. (FCH), a real estate investment trust (REIT), has
recently priced a debt offer of senior unsecured notes worth $525
million. The debt offering is likely to increase the liquidity of
the company to repay its outstanding liabilities.
The notes are scheduled to mature in 2023 and bear interest at
5.625%. FelCor primarily intends to utilize the proceeds to redeem
approximately $258 million worth of 10% senior notes due 2014 and
repay a $186 million mortgage loan due 2013. The remainder of the
proceeds would be used for general corporate purposes.
Incidentally, FelCor has also updated its outlook for full year
2012 in the recent past to better reflect the adverse effects of
Hurricane Sandy on its business. Although the company reported
minimal physical damage to its properties, the hurricane had a
material impact on its operations and was likely to affect its
profitability.
FelCor presently expects a same-store RevPAR (revenue per available
room) growth of 5.25% – 5.75% versus an earlier projection of 5.50%
– 6.00%. Adjusted EBITDA (earnings before interest, tax,
depreciation, and amortization) is expected to be in the range of
$198.0 million – $202.0 million, compared to earlier estimates of
$200.0 million – $204.0 million.
In addition, FelCor reduced its fiscal 2012 adjusted FFO (funds
from operations) guidance from 21 cents – 25 cents to 19 cents – 23
cents. The current Zacks Consensus Estimate for 2012 is pegged at
22 cents.
FelCor currently owns 66 upper-upscale full-service hotels and
resorts in 22 states in the U.S. under globally recognized brands
such as – Embassy Suites Hotels, Doubletree, Hilton, Marriott,
Renaissance, Fairmont, Sheraton, Westin and Holiday Inn. Most of
the properties of the company are located in major markets across
the country.
We have a Neutral recommendation on FelCor, which presently has a
Zacks #3 Rank that translates into a short-term Hold
recommendation. We also have a Neutral recommendation and a Zacks
#3 Rank for Host Hotels & Resorts Inc. (HST),
one of the competitors of FelCor.
Note: FFO, a widely used metric to gauge the performance of
REITs, is obtained after adding depreciation and amortization and
other non-cash expenses to net income.
FELCOR LODGING (FCH): Free Stock Analysis Report
HOST HOTEL&RSRT (HST): Free Stock Analysis Report
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