FelCor Lodging Trust Incorporated (NYSE: FCH), today reported operating results for the first quarter ended March 31, 2012.
First Quarter Summary:
- Revenue per available room ("RevPAR") for 69 same-store hotels increased 3.6%. RevPAR for same-store hotels not under renovation or redevelopment increased 7.1%.
- Hotel EBITDA margin remained the same as the prior year at 21.8% for the quarter and increased 125 basis points for hotels not under renovation.
- Adjusted funds from operations ("FFO") per share were a loss of $0.02, and Adjusted EBITDA was $41.4 million, both of which met the high end of our expectations.
- Net loss was $28.9 million.
- Agreed to sell six non-strategic hotels for $103 million. Proceeds from the sale will be used to repay $73 million of related debt and other costs with the remaining proceeds used to pay $30 million of accrued preferred dividends.
First Quarter Operating Results:
RevPAR (for 69 same-store hotels) was $95.31, a 3.6% increase compared to the same period in 2011. The increase was driven by a 3.5% increase in average daily rate ("ADR") to $137.02 and a 10 basis point increase in occupancy to 69.6%. RevPAR for hotels not under renovation increased 7.1%.Commenting on the first quarter, Richard A. Smith, President and Chief Executive Officer of FelCor, said, “We continue to execute our long-term strategic plan. We have six hotels under contract and expect to sell a majority of the remaining non-strategic hotels on the market this year. As part of our previously announced balance restructuring plan, we are using the proceeds to repay debt and pay accrued preferred dividends as we work to substantially reduce leverage, stagger debt maturities and lower our cost of borrowing. The redevelopment projects and value creation plans at our newly acquired hotels are also progressing as expected. These hotels will provide the company with substantial RevPAR and EBITDA growth in the future. For the quarter, RevPAR at our hotels not under renovation was very strong and FFO per share was at the high end of our expectations. These results reflect our high-quality and diversified portfolio as well as strong lodging fundamentals. Corporate transient demand is strong, and group pace continues to slowly improve. Coupled with historically low supply growth, our confidence in a sustained lodging recovery is growing, and we are raising our 2012 outlook. Last quarter, the lodging industry experienced the highest quarterly ADR growth since the first quarter of 2008. As hotels approach prior peak occupancy levels, ADR growth should continue to accelerate."