NEWTON, Mass.--(BUSINESS WIRE)--
Hospitality Properties Trust (NYSE: HPT) today announced its financial
results for the quarter and nine months ended September 30, 2012.
Results for the Quarter Ended September 30, 2012:
Normalized funds from operations, or Normalized FFO, for the quarter
ended September 30, 2012 were $91.5 million, or $0.74 per share,
compared to Normalized FFO for the quarter ended September 30, 2011 of
$98.0 million, or $0.79 per share.
Net income available for common shareholders was $29.5 million, or $0.24
per share, for the quarter ended September 30, 2012, compared to $40.1
million, or $0.32 per share, for the same quarter last year. Net income
available for common shareholders for the quarter ended September 30,
2012 included a $10.6 million, or $0.09 per share, gain on sale of real
estate and was reduced by $5.0 million, or $0.04 per share, due to the
liquidation preference for HPT's preferred shares that were redeemed
during that period exceeding the carrying value for those preferred
shares.
The weighted average number of common shares outstanding was 123.6
million and 123.5 million for the quarters ended September 30, 2012 and
2011, respectively.
A reconciliation of net income available for common shareholders
determined according to U.S. generally accepted accounting principles,
or GAAP, to funds from operations, or FFO, and Normalized FFO for the
quarters ended September 30, 2012 and 2011 appears later in this press
release.
Results for the Nine Months Ended September 30, 2012:
Normalized FFO for the nine months ended September 30, 2012 were $280.9
million, or $2.27 per share, compared to Normalized FFO for the nine
months ended September 30, 2011 of $310.7 million, or $2.52 per share.
Net income available for common shareholders was $85.3 million, or $0.69
per share, for the nine months ended September 30, 2012, compared to
$129.8 million, or $1.05 per share, for the same period last year. Net
income available for common shareholders for the nine months ended
September 30, 2012, included a $10.6 million, or $0.09 per share, gain
on sale of real estate and was reduced by $8.0 million, or $0.06 per
share, due to the liquidation preference for HPT's preferred shares that
were redeemed during that period exceeding the carrying value for those
preferred shares. Net income available for common shareholders for the
nine months ended September 30, 2011, was reduced by a $7.3 million, or
$0.06 per share, loss on asset impairment.
The weighted average number of common shares outstanding was 123.6
million and 123.5 million for the nine months ended September 30, 2012
and 2011, respectively.
A reconciliation of net income available for common shareholders
determined according to GAAP to FFO and Normalized FFO for the nine
months ended September 30, 2012 and 2011 appears later in this press
release.
Hotel Portfolio Performance:
For the quarter ended September 30, 2012 compared to the same period in
2011 for HPT's 285 comparable hotels: average daily rate, or ADR,
increased 6.1% to $99.14; occupancy decreased 4.3 percentage points to
72.8%; and, as a result, revenue per available room, or RevPAR,
increased by 0.2% to $72.17.
During the quarter ended September 30, 2012, HPT had 27 hotels under
renovation for all or part of the quarter. In addition, as discussed
below, HPT rebranded 35 hotels during the quarter ended September 30,
2012. For the quarter ended September 30, 2012 compared to the same
period in 2011 for HPT's 223 comparable hotels not under renovation and
not rebranded during the quarter: ADR increased 5.8% to $102.68;
occupancy decreased 1.2 percentage points to 75.1%; and, as a result,
RevPAR increased by 4.1% to $77.11.
For the nine months ended September 30, 2012 compared to the same period
in 2011 for HPT's 285 comparable hotels: ADR increased 6.0% to $99.34;
occupancy decreased 4.1 percentage points to 69.7%; and, as a result
RevPAR increased by 0.1% to $69.24.
During the nine months ended September 30, 2012, HPT had 123 hotels
under renovation for all or part of the period. In addition, as
discussed below, HPT rebranded 39 hotels during the nine months ended
September 30, 2012. For the nine months ended September 30, 2012
compared to the same period in 2011 for HPT's 123 comparable hotels not
under renovation and not rebranded during the period: ADR increased 4.2%
to $107.84; occupancy increased 0.7 percentage points to 71.2%; and, as
a result, RevPAR increased by 5.2% to $76.78.
Tenants and Managers:
Marriott No. 234. During the three months ended September 30,
2012, the payments HPT received under its management contract with
Marriott International, Inc. (NYSE: MAR), or Marriott, covering 68
hotels and requiring minimum returns to HPT of $100.6 million per year
(referred to as the Marriott No. 234 agreement) were $2.3 million less
than the minimum amounts contractually required. During the three months
ended September 30, 2012, Marriott was not required to make any guaranty
payments to HPT because the payments HPT received were in excess of the
guaranty threshold amount (90% of the minimum returns due to HPT).
During the three months ended September 30, 2012, the amount available
under Marriott's guaranty was replenished by the $0.4 million of hotel
cash flows in excess of the guaranty threshold. At September 30, 2012,
there was $30.9 million remaining under Marriott's guaranty to cover
future payment shortfalls for up to 90% of the minimum returns due to
HPT.
InterContinental. During the three months ended September 30,
2012, the payments HPT received under its management contract with
InterContinental Hotels Group, plc (LON: IHG; NYSE: IHG (ADRs)), or
InterContinental, covering 91 hotels and requiring minimum returns to
HPT of $131.7 million per year (referred to as the InterContinental
agreement) were $2.7 million less than the minimum amounts contractually
required. HPT applied the available security deposit to cover these
shortfalls. At September 30, 2012, the available security deposit which
HPT held to cover future payment shortfalls was $38.3 million.
As of September 30, 2012, all other payments due to HPT from its
managers and tenants under its operating agreements were current.
Acquisition, Disposition and Rebranding Activities:
Marriott No. 234. As previously announced, in July 2012, HPT sold
a full service Marriott hotel in St. Louis, MO. HPT received net
proceeds of $28.9 million from this sale and HPT's annual minimum
returns under the Marriott No. 234 agreement were decreased by $2.6
million when this hotel was sold. Also as previously announced, in
August 2012, HPT removed two hotels from the Marriott No. 234 agreement
and converted these two hotels to Sonesta International Hotels
Corporation, or Sonesta, brands and management. HPT's annual minimum
returns under the Marriott No. 234 agreement were reduced by $1.0
million when these two hotels were removed.
InterContinental. During the third quarter of 2012, HPT completed
its previously announced plan to remove 39 hotels from the
InterContinental agreement. HPT entered into management agreements with
Sonesta during the second and third quarters and converted 17 of these
39 hotels to Sonesta brands and management. In May 2012, HPT entered
into an agreement with Wyndham Hotel Group, or Wyndham, a member of the
Wyndham Worldwide Corporation (NYSE: WYN), for 20 of these 39 hotels
(referred to as the Wyndham agreement). HPT converted these 20 hotels to
Wyndham brands and management on August 1, 2012. In August 2012, HPT
sold the remaining two of the 39 removed hotels for combined net
proceeds of $5.4 million. HPT's annual minimum returns due under the
InterContinental agreement decreased by an aggregate of $35.0 million
upon the removal of these 39 hotels.
Wyndham. As described above, in May 2012, HPT entered an
agreement to convert 20 of its hotels to Wyndham brands and management.
All 20 hotels are being managed by Wyndham under a long term management
contract with an initial term of 25 years and two renewal terms of 15
years each. Under the terms of the Wyndham agreement, Wyndham has agreed
to pay HPT an annual minimum return from the operating results of these
hotels, and such payment is partially guaranteed by Wyndham. HPT has
agreed to provide up to $75.0 million for refurbishment and rebranding
of these hotels to "Wyndham Hotels and Resorts" (four hotels) and
"Hawthorn Suites by Wyndham" (16 hotels) brand standards. As these
amounts are funded, the annual minimum return due to HPT under the
Wyndham agreement will increase by 8% of the amounts funded.
On November 1, 2012, HPT acquired the Hotel 71, a full service hotel in
Chicago, IL for $85.0 million, excluding closing costs, and added it to
its Wyndham agreement. Upon completion of a planned renovation, the
property will consist of 348 hotel rooms managed by Wyndham and 48
vacation units leased to Wyndham Vacation Resorts, Inc., also a member
of Wyndham Worldwide Corporation. HPT's annual minimum returns under the
Wyndham agreement increased by $5.8 million and the maximum amount of
the limited guaranty provided by Wyndham increased to $29.0 million upon
closing of this hotel acquisition. The lease with Wyndham Vacation
Resorts, Inc. will provide for annual initial rent to HPT of $1.0
million subject to annual escalation and is guaranteed by Wyndham under
an unlimited guarantee. HPT plans to convert this hotel to the "Wyndham
Grand Chicago Riverfront" hotel and has agreed to provide up to $18.0
million for the rebranding and renovation of this hotel. As these
amounts are funded, the annual minimum return due to HPT under the
Wyndham agreement will increase by 8% of the amounts funded.
Recent Financing Activities:
In August 2012, HPT issued $500.0 million of 5.0% unsecured senior notes
due in 2022 in a public offering. Net proceeds from this offering
($487.9 million after underwriting and other offering expenses) were
used to redeem at par plus accrued and unpaid interest all of HPT's
outstanding 6.75% Senior Notes due 2013 (approximately $288.3 million in
total), to redeem 6,000,000 of its 7% Series C cumulative redeemable
preferred shares for $25.00 per share plus accrued and unpaid
distributions (approximately $150.8 million in total) and for general
business purposes.
Conference Call:
On Tuesday, November 6, 2012, at 1:00 p.m. Eastern Time, John Murray,
President and Chief Operating Officer, and Mark Kleifges, Treasurer and
Chief Financial Officer, will host a conference call to discuss the
results for the quarter and nine months ended September 30, 2012. The
conference call telephone number is (800) 230-1059. Participants calling
from outside the United States and Canada should dial (612) 234-9959. No
passcode is necessary to access the call from either number.
Participants should dial in about 15 minutes prior to the scheduled
start of the call. A replay of the conference call will be available
beginning on Tuesday, November 6, 2012 and will run through Tuesday,
November 13, 2012. To hear the replay, dial (320) 365-3844. The replay
passcode is 260117.
A live audio webcast of the conference call will also be available in a
listen only mode on our website, which is located at www.hptreit.com.
Participants wanting to access the webcast should visit our website
about five minutes before the call. The archived webcast will be
available for replay on HPT's website for about one week after the call.
The recording and retransmission in any way of HPT's third quarter
conference call is strictly prohibited without the prior written consent
of HPT.
Supplemental Data:
A copy of HPT's Third Quarter 2012 Supplemental Operating and Financial
Data is available for download at HPT's website, www.hptreit.com. HPT's
website is not incorporated as part of this press release.
Hospitality Properties Trust is a real estate investment trust, or REIT,
which as of September 30, 2012, owned or leased 287 hotels and 185
travel centers located in 44 states, Puerto Rico and Canada. HPT is
headquartered in Newton, MA.
Please see the following pages for a more detailed statement of HPT's
operating results and financial condition and for an explanation of our
calculation of FFO and Normalized FFO.
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Hospitality Properties Trust
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CONDENSED CONSOLIDATED STATEMENTS OF INCOME, FUNDS FROM OPERATIONS
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AND NORMALIZED FUNDS FROM OPERATIONS
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(in thousands, except per share data)
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(Unaudited)
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Quarter Ended September 30,
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Nine Months Ended September 30,
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2012
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2011
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2012
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2011
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Revenues:
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Hotel operating revenues (1)
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$
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251,722
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$
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242,995
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$
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741,775
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$
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670,867
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Rental income (1)
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73,915
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72,305
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220,863
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230,078
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FF&E reserve income (2)
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4,431
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3,389
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12,033
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13,537
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Total revenues
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330,068
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318,689
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974,671
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914,482
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Expenses:
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Hotel operating expenses (1)
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184,566
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168,278
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527,806
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450,845
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Depreciation and amortization
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66,566
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57,106
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192,206
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171,050
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General and administrative
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10,336
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11,292
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32,333
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30,746
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Acquisition related costs (3)
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84
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387
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1,648
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1,150
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Loss on asset impairment (4)
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-
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-
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889
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7,263
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Total expenses
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261,552
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237,063
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754,882
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661,054
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Operating income
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68,516
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81,626
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219,789
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253,428
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Interest income
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116
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11
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233
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54
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Interest expense (including amortization of deferred
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financing costs and debt discounts of $1,694,
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$1,614, $4,648 and $4,623, respectively)
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(34,854)
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(33,513)
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(101,660)
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(100,183)
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Gain on sale of real estate (5)
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10,602
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-
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10,602
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-
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Equity in earnings of an investee
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115
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28
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236
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111
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Income before income taxes
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44,495
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48,152
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129,200
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153,410
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Income tax benefit (expense)
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163
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(621)
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(3,908)
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(1,188)
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Net income
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44,658
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47,531
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125,292
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152,222
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Excess of liquidation preference over carrying value
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of preferred shares redeemed (6)
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(5,040)
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-
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(7,984)
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-
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Preferred distributions
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(10,138)
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(7,470)
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(32,048)
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(22,410)
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Net income available for common shareholders
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$
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29,480
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$
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40,061
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$
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85,260
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$
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129,812
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Calculation of Funds from Operations (FFO) and Normalized FFO:
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Net income available for common shareholders
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$
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29,480
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$
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40,061
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$
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85,260
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$
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129,812
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Add: Depreciation and amortization
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66,566
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57,106
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192,206
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171,050
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Loss on asset impairment (4)
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-
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-
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889
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7,263
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Gain on sale of real estate(5)
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(10,602)
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-
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(10,602)
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-
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FFO (7)
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85,444
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97,167
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267,753
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308,125
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Add: Deferred percentage rent (8)
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Acquisition related costs (3)
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919
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481
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3,481
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1,417
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Excess of liquidation preference over carrying value
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84
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387
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1,648
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1,150
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of preferred shares redeemed (6)
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5,040
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-
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7,984
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-
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Normalized FFO (7)
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$
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91,487
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$
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98,035
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$
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280,866
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$
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310,692
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Weighted average common shares outstanding
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123,577
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123,465
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123,553
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123,453
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Per common share amounts:
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Net income available for common shareholders
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$
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0.24
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$
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0.32
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$
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0.69
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$
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1.05
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FFO (7)
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$
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0.69
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$
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0.79
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$
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2.17
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$
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2.50
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Normalized FFO (7)
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$
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0.74
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$
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0.79
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$
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2.27
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$
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2.52
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(1)
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At September 30, 2012, we owned or leased 287 hotels; 231 of these
hotels are leased by us to our taxable REIT subsidiaries, or TRSs,
and managed by third party hotel operating companies, one hotel is
leased by one of our TRSs from a third party and managed by a third
party hotel operating company and 55 hotels are leased to third
parties. At September 30, 2012, we also owned 185 travel centers
that are leased to a travel center operating company under two lease
agreements. Our Condensed Consolidated Statements of Income include
hotel operating revenues and expenses of managed hotels and rental
income from our leased hotels and travel centers. Certain of our
managed hotel portfolios had net operating results that were, in the
aggregate, $20,300 and $6,653, less than the minimum returns due to
us in the three months ended September 30, 2012 and 2011,
respectively, and $46,697 and $37,875 less than the minimum returns
due to us in the nine months ended September 30, 2012 and 2011,
respectively. When the shortfalls are funded by the managers of
these hotels under the terms of our operating agreements, we reflect
such fundings (including security deposit applications) in our
Condensed Consolidated Statements of Income as a reduction of hotel
operating expenses. The reduction to operating expenses was $12,791
and $6,653 in the three months ended September 30, 2012 and 2011,
respectively, and $30,483 and $37,875 in the nine months ended
September 30, 2012 and 2011, respectively. We had $9,840 and $16,210
of shortfalls not funded by managers during the three and nine
months ended September 30, 2012, respectively, which represents the
unguaranteed portion of our minimum returns from Marriott and from
Sonesta.
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(2)
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Various percentages of total sales at certain of our hotels are
escrowed as reserves for future renovations or refurbishment, or
FF&E reserve escrows. We own all the FF&E reserve escrows for our
hotels. We report deposits by our third party tenants into the
escrow accounts as FF&E reserve income. We do not report the amounts
which are escrowed as FF&E reserves for our managed hotels as FF&E
reserve income.
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(3)
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Represents costs associated with our hotel acquisition activities.
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(4)
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We recorded an $889, or $0.01 per share, loss on asset impairment in
the first quarter of 2012 in connection with our decision to remove
20 Marriott branded hotels from held for sale status. We recorded a
$7,263, or $0.06 per share, loss on asset impairment in the second
quarter of 2011 in connection with our consideration of selling
certain InterContinental and Marriott hotels.
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(5)
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We recorded a $10,602, or $0.09 per share, gain on sale of real
estate in the third quarter of 2012 in connection with the sales of
our Marriott hotel in St. Louis, MO and our Staybridge Suites hotels
in Auburn Hills, MI and Schaumburg, IL.
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|
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(6)
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|
|
On February 13, 2012, we redeemed all of our outstanding Series B
Preferred Shares at their liquidation preference of $25 per share,
plus accumulated and unpaid distributions. The liquidation
preference of the redeemed shares exceeded our carrying amount for
the redeemed shares as of the date of redemption by $2,944, or $0.02
per share, and we reduced net income available to common
shareholders for the three months ended March 31, 2012, by that
excess amount. On September 10, 2012, we redeemed 6,000,000 of our
Series C Preferred Shares at their liquidation preference of $25 per
share, plus accumulated and unpaid distributions. The liquidation
preference of the redeemed shares exceeded our carrying amount for
the redeemed shares as of the date of redemption by $5,040, or $0.04
per share, and we reduced net income available to common
shareholders for the three months ended September 30, 2012, by that
excess amount.
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|
|
|
|
(7)
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|
|
We calculate FFO and Normalized FFO as shown above. FFO is
calculated on the basis defined by The National Association of Real
Estate Investment Trusts, or NAREIT, which is net income, calculated
in accordance with GAAP, excluding any gain or loss on sale of
properties and impairment of assets, plus real estate depreciation
and amortization, as well as other adjustments currently not
applicable to us. Our calculation of Normalized FFO differs from
NAREIT's definition of FFO because we include estimated percentage
rent in the period to which it relates to rather than when it is
recognized as income in accordance with GAAP and exclude excess of
liquidation preference over carrying value of preferred shares and
acquisition related costs. We consider FFO and Normalized FFO to be
appropriate measures of performance for a REIT, along with net
income, operating income and cash flow from operating, investing and
financing activities. We believe that FFO and Normalized FFO provide
useful information to investors because by excluding the effects of
certain historical amounts, such as depreciation expense, FFO and
Normalized FFO can facilitate a comparison of operating performances
between periods. FFO and Normalized FFO are among the factors
considered by our Board of Trustees when determining the amount of
distributions to our shareholders. Other factors include, but are
not limited to, requirements to maintain our status as a REIT,
limitations in our revolving credit facility, term loan and public
debt covenants, the availability of debt and equity capital to us
and our expectation of our future capital requirements and operating
performance. FFO and Normalized FFO do not represent cash generated
by operating activities in accordance with GAAP and should not be
considered as alternatives to net income, operating income or cash
flow from operating activities, determined in accordance with GAAP,
or as indicators of our financial performance or liquidity, nor are
these measures necessarily indicative of sufficient cash flow to
fund all of our needs. We believe FFO and Normalized FFO may
facilitate an understanding of our consolidated historical operating
results. These measures should be considered in conjunction with net
income, operating income, net income available to common
shareholders and cash flow from operating activities as presented in
our Condensed Consolidated Statements of Income and Comprehensive
Income and Condensed Consolidated Statements of Cash Flows. Other
REITs and real estate companies may calculate FFO and Normalized FFO
differently than we do.
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|
|
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(8)
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|
|
In calculating net income in accordance with GAAP, we recognize
percentage rental income received for the first, second and third
quarters in the fourth quarter, which is when all contingencies have
been met and the income is earned. Although we defer recognition of
this revenue until the fourth quarter for purposes of calculating
net income, we include these estimated amounts in the calculation of
Normalized FFO for each quarter of the year. The fourth quarter
Normalized FFO calculation excludes the amounts recognized during
the first three quarters.
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|
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|
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Hospitality Properties Trust
|
CONDENSED CONSOLIDATED BALANCE SHEETS
|
(in thousands, except share data)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
September 30, 2012
|
|
|
December 31, 2011
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
Real estate properties:
|
|
|
|
|
|
Land
|
$
|
1,412,945
|
|
|
$
|
1,360,773
|
|
Buildings, improvements and equipment
|
|
5,184,527
|
|
|
|
4,879,908
|
|
|
|
6,597,472
|
|
|
|
6,240,681
|
|
Accumulated depreciation
|
|
(1,501,592
|
)
|
|
|
(1,367,868
|
)
|
|
|
5,095,880
|
|
|
|
4,872,813
|
|
|
|
|
|
|
|
Property held for sale
|
|
-
|
|
|
|
18,440
|
|
Cash and cash equivalents
|
|
17,124
|
|
|
|
8,303
|
|
Restricted cash (FF&E reserve escrow)
|
|
38,919
|
|
|
|
50,196
|
|
Other assets, net
|
|
221,009
|
|
|
|
183,821
|
|
|
$
|
5,372,932
|
|
|
$
|
5,133,573
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
Unsecured revolving credit facility
|
$
|
-
|
|
|
$
|
149,000
|
|
Unsecured term loan
|
|
400,000
|
|
|
|
-
|
|
Senior notes, net of discounts
|
|
1,993,387
|
|
|
|
1,887,891
|
|
Convertible senior notes, net of discounts
|
|
8,478
|
|
|
|
78,823
|
|
Security deposits
|
|
88,952
|
|
|
|
106,422
|
|
Accounts payable and other liabilities
|
|
88,100
|
|
|
|
103,668
|
|
Due to related persons
|
|
12,354
|
|
|
|
3,713
|
|
Dividends payable
|
|
6,664
|
|
|
|
4,754
|
|
Total liabilities
|
|
2,597,935
|
|
|
|
2,334,271
|
|
|
|
|
|
|
|
Commitments and contingencies
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity:
|
|
|
|
|
|
Preferred shares of beneficial interest; no par value; 100,000,000
|
|
|
|
|
|
shares authorized:
|
|
|
|
|
|
Series B preferred shares; 8 7/8% cumulative
|
|
|
|
|
|
redeemable; zero and 3,450,000 shares issued and outstanding,
respectively,
|
|
|
|
|
|
aggregate liquidation preference zero and $86,250, respectively
|
|
-
|
|
|
|
83,306
|
|
Series C preferred shares; 7% cumulative redeemable; 6,700,000
|
|
|
|
|
|
and 12,700,000 shares issued and outstanding, respectively,
|
|
|
|
|
|
aggregate liquidation preference $167,500 and $317,500, respectively
|
|
161,873
|
|
|
|
306,833
|
|
Series D preferred shares; 7 1/8% cumulative redeemable;
|
|
|
|
|
|
11,600,000 and zero shares issued and outstanding, respectively
|
|
|
|
|
|
aggregate liquidation preference $290,000 and zero, respectively
|
|
280,107
|
|
|
|
-
|
|
Common shares of beneficial interest, $.01 par value;
|
|
|
|
|
|
200,000,000 shares authorized; 123,563,407 and
|
|
|
|
|
|
123,521,535 shares issued and outstanding, respectively
|
|
1,236
|
|
|
|
1,235
|
|
Additional paid in capital
|
|
3,466,066
|
|
|
|
3,463,534
|
|
Cumulative net income
|
|
2,350,261
|
|
|
|
2,232,953
|
|
Cumulative other comprehensive income
|
|
4,455
|
|
|
|
1,605
|
|
Cumulative preferred distributions
|
|
(245,329
|
)
|
|
|
(213,281
|
)
|
Cumulative common distributions
|
|
(3,243,672
|
)
|
|
|
(3,076,883
|
)
|
Total shareholders' equity
|
|
2,774,997
|
|
|
|
2,799,302
|
|
|
$
|
5,372,932
|
|
|
$
|
5,133,573
|
|
|
|
|
|
|
|
|
|
WARNING CONCERNING FORWARD LOOKING STATEMENTS
THIS PRESS RELEASE CONTAINS STATEMENTS THAT CONSTITUTE FORWARD LOOKING
STATEMENTS WITHIN THE MEANING OF THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995 AND OTHER SECURITIES LAWS. ALSO, WHENEVER HPT USES
WORDS SUCH AS "BELIEVE", "EXPECT", "ANTICIPATE", "INTEND", "PLAN",
"ESTIMATE" OR SIMILAR EXPRESSIONS, HPT IS MAKING FORWARD LOOKING
STATEMENTS. THESE FORWARD LOOKING STATEMENTS ARE BASED UPON HPT'S
PRESENT INTENT, BELIEFS OR EXPECTATIONS, BUT FORWARD LOOKING STATEMENTS
ARE NOT GUARANTEED TO OCCUR AND MAY NOT OCCUR. ACTUAL RESULTS MAY DIFFER
MATERIALLY FROM THOSE CONTAINED IN OR IMPLIED BY THESE FORWARD LOOKING
STATEMENTS AS A RESULT OF VARIOUS FACTORS. FOR EXAMPLE:
-
THIS PRESS RELEASE STATES THAT $30.9 MILLION REMAINED AS OF SEPTEMBER
30, 2012, TO PARTIALLY FUND MINIMUM PAYMENT SHORTFALLS UNDER THE TERMS
OF A LIMITED GUARANTY PROVIDED BY MARRIOTT. THIS STATEMENT MAY IMPLY
THAT MARRIOTT WILL BE ABLE OR WILLING TO FULFILL ITS OBLIGATION UNDER
THIS GUARANTY OR THAT FUTURE SHORTFALLS WILL NOT EXHAUST THE GUARANTY
CAP. HOWEVER, THIS GUARANTY EXPIRES ON DECEMBER 31, 2019, AND HPT CAN
PROVIDE NO ASSURANCE WITH REGARD TO MARRIOTT'S FUTURE ACTIONS OR THE
FUTURE PERFORMANCE OF HPT'S HOTELS TO WHICH THE MARRIOTT LIMITED
GUARANTY APPLIES.
-
THIS PRESS RELEASE STATES THAT HPT IS HOLDING AND HAS APPLIED OR MAY
CONTINUE TO APPLY A SECURITY DEPOSIT TO COVER THE SHORTFALL OF THE
PAYMENTS IT HAS RECEIVED OR EXPECTS TO RECEIVE UNDER ITS
INTERCONTINENTAL AGREEMENT COMPARED TO THE MINIMUM PAYMENTS DUE TO HPT
UNDER THIS AGREEMENT. THE SECURITY DEPOSIT WHICH HPT IS HOLDING IS
LIMITED IN AMOUNT. THERE CAN BE NO ASSURANCE REGARDING THE AMOUNT OF
PAYMENTS HPT MAY RECEIVE IN THE FUTURE UNDER THIS AGREEMENT AND FUTURE
SHORTFALLS MAY EXCEED THE AMOUNT OF THE SECURITY DEPOSIT HPT HOLDS.
MOREOVER, THE SECURITY DEPOSIT IS NOT ESCROWED OR OTHERWISE SEGREGATED
FROM HPT'S OTHER ASSETS AND LIABILITIES; ACCORDINGLY, WHEN HPT APPLIES
THIS SECURITY DEPOSIT TO COVER MINIMUM PAYMENTS DUE, HPT WILL RECORD
INCOME BUT IT WILL NOT RECEIVE ANY ADDITIONAL CASH.
-
THIS PRESS RELEASE STATES THAT WYNDHAM HAS AGREED TO PAY HPT AN ANNUAL
MINIMUM RETURN AND THAT THE PAYMENT OF THESE AMOUNTS IS PARTIALLY
GUARANTEED BY WYNDHAM. THE ANNUAL MINIMUM RETURN DUE TO HPT IS PAID
FROM THE OPERATING CASH FLOW OF THE MANAGED HOTELS; IF THE CASH FLOW
IS INSUFFICIENT TO PAY THE HOTELS' OPERATING EXPENSES, THE ANNUAL
MINIMUM RETURN MAY NOT BE PAID. WYNDHAM'S GUARANTEE IS LIMITED BY TIME
TO ANNUAL MINIMUM RETURN PAYMENTS DUE THROUGH 2019, AND IT IS LIMITED
TO NET PAYMENTS FROM WYNDHAM OF $29.0 MILLION (AND IT IS SUBJECT TO AN
ANNUAL PAYMENT LIMIT OF $14.5 MILLION). ACCORDINGLY, THE FULL AMOUNT
OF THE ANNUAL MINIMUM RETURN IS NOT GUARANTEED, THERE WILL BE NO
GUARANTEE AFTER 2019 AND THERE IS NO GUARANTEE OF PAYMENTS BY WYNDHAM
IN EXCESS OF $29.0 MILLION (OR $14.5 MILLION PER YEAR). FOR THESE
REASONS, THERE IS NO ASSURANCE THAT HPT WILL RECEIVE THE ANNUAL
MINIMUM RETURN DURING THE TERM OF ITS WYNDHAM AGREEMENT.
THE INFORMATION CONTAINED IN HPT'S FILINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION, OR SEC, INCLUDING UNDER "RISK FACTORS" IN HPT'S
PERIODIC REPORTS, OR INCORPORATED THEREIN, IDENTIFIES OTHER IMPORTANT
FACTORS THAT COULD CAUSE HPT'S ACTUAL RESULTS TO DIFFER MATERIALLY FROM
THOSE STATED IN HPT'S FORWARD LOOKING STATEMENTS. HPT'S FILINGS WITH THE
SEC ARE AVAILABLE ON THE SEC'S WEBSITE AT WWW.SEC.GOV.
YOU SHOULD NOT PLACE UNDUE RELIANCE UPON HPT'S FORWARD LOOKING
STATEMENTS.
EXCEPT AS REQUIRED BY LAW, HPT DOES NOT INTEND TO UPDATE OR CHANGE ANY
FORWARD LOOKING STATEMENTS AS A RESULT OF NEW INFORMATION, FUTURE EVENTS
OR OTHERWISE.
A Maryland Real Estate Investment Trust with transferable shares of
beneficial interest listed on the New York Stock Exchange.
No
shareholder, Trustee or officer is personally liable for any act or
obligation of the Trust.
Hospitality Properties Trust
Timothy A. Bonang, 617-796-8232
Vice
President, Investor Relations
or
Carlynn Finn, 617-796-8232
Senior
Manager, Investor Relations
www.hptreit.com