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Casa Pool Deck (Photo: LaSalle Hotel Properties)

Stocks in this article: LHO

FFO, EBITDA and hotel EBITDA do not represent cash generated from operating activities as determined by GAAP and should not be considered as alternatives to net income or loss, cash flows from operations or any other operating performance measure prescribed by GAAP. FFO, EBITDA and hotel EBITDA are not measures of the Company's liquidity, nor are FFO, EBITDA and hotel EBITDA indicative of funds available to fund the Company's cash needs, including its ability to make cash distributions. These measurements do not reflect cash expenditures for long-term assets and other items that have been and will be incurred. FFO, EBITDA and hotel EBITDA may include funds that may not be available for management's discretionary use due to functional requirements to conserve funds for capital expenditures, property acquisitions, and other commitments and uncertainties. To compensate for this, management considers the impact of these excluded items to the extent they are material to operating decisions or the evaluation of the Company's operating performance.

Adjusted FFO and Adjusted EBITDA

The Company presents adjusted FFO (including adjusted FFO per share/unit) and adjusted EBITDA, which adjusts for certain additional items including gains on sale of property and impairment losses (to the extent included in EBITDA), acquisition transaction costs, costs associated with the departure of executive officers, costs associated with the recognition of issuance costs related to the calling of preferred shares and certain other items. The Company excludes these items as it believes it allows for meaningful comparisons with other REITs and between periods and is more indicative of the ongoing performance of its assets. As with FFO, EBITDA, and hotel EBITDA, the Company’s calculation of adjusted FFO and adjusted EBITDA may be different from similar adjusted measures calculated by other REITs.

 
LASALLE HOTEL PROPERTIES
Consolidated Statements of Operations and Comprehensive Income
(in thousands, except share data)
(unaudited)
       
 

For the three months ended

For the six months ended
June 30, June 30,
Revenues:   2012     2011     2012     2011  
Hotel operating revenues:
Room $ 167,186 $ 134,005 $ 281,878 $ 222,918
Food and beverage 58,787 54,203 103,402 92,445
Other operating department   14,839     13,161     26,695     23,118  
Total hotel operating revenues 240,812 201,369 411,975 338,481
Other income   1,283     1,181     2,439     2,419  
Total revenues   242,095     202,550     414,414     340,900  
Expenses:
Hotel operating expenses:
Room 38,688 30,631 72,541 55,973
Food and beverage 39,475 35,746 73,737 64,580
Other direct 5,558 5,466 10,184 9,842
Other indirect   55,152     48,111     103,193     88,054  
Total hotel operating expenses 138,873 119,954 259,655 218,449
Depreciation and amortization 31,279 27,999 61,431 55,807
Real estate taxes, personal property taxes and insurance 10,865 8,786 21,676 17,271
Ground rent 2,210 2,033 3,986 3,376
General and administrative 4,849 3,928 9,463 8,734
Acquisition transaction costs 307 245 3,901 421
Other expenses   918     502     1,469     1,081  
Total operating expenses   189,301     163,447     361,581     305,139  
Operating income 52,794 39,103 52,833 35,761
Interest income 16 5 26 14
Interest expense   (12,503 )   (9,928 )   (24,281 )   (19,710 )
Income before income tax expense and discontinued operations 40,307 29,180 28,578 16,065
Income tax expense   (4,969 )   (5,069 )   (1,977 )   (2,545 )
Income from continuing operations   35,338     24,111     26,601     13,520  
Discontinued operations:
Income (loss) from operations of property disposed of - 44 - (319 )
Income tax (expense) benefit   -     (18 )   -     132  
Net income (loss) from discontinued operations   -     26     -     (187 )
Net income   35,338     24,137     26,601     13,333  
Noncontrolling interests:
Redeemable noncontrolling interest in loss of consolidated entity - - - 2
Noncontrolling interests of common units in Operating Partnership   (130 )   -     (108 )   -  
Net (income) loss attributable to noncontrolling interests   (130 )   -     (108 )   2  
Net income attributable to the Company 35,208 24,137 26,493 13,335
Distributions to preferred shareholders (5,999 ) (7,402 ) (13,401 ) (15,148 )
Issuance costs of redeemed preferred shares   (4,417 )   -     (4,417 )   (731 )
Net income (loss) attributable to common shareholders $ 24,792   $ 16,735   $ 8,675   $ (2,544 )
 
 
LASALLE HOTEL PROPERTIES
Consolidated Statements of Operations and Comprehensive Income - Continued
(in thousands, except share data)
(unaudited)
       
 
For the three months ended For the six months ended
June 30, June 30,
  2012     2011   2012     2011  
Earnings per Common Share - Basic:

Net income (loss) attributable to common shareholders before discontinued operations and excluding amounts attributable to unvested restricted shares

$ 0.29 $ 0.20 $ 0.10 $ (0.03 )
Discontinued operations   -     -   -     -  

Net income (loss) attributable to common shareholders excluding amounts attributable to unvested restricted shares

$ 0.29   $ 0.20 $ 0.10   $ (0.03 )
 
Earnings per Common Share - Diluted:

Net income (loss) attributable to common shareholders before discontinued operations and excluding amounts attributable to unvested restricted shares

$ 0.29 $ 0.20 $ 0.10 $ (0.03 )
Discontinued operations   -     -   -     -  

Net income (loss) attributable to common shareholders excluding amounts attributable to unvested restricted shares

$ 0.29 $ 0.20 $ 0.10   $ (0.03 )
 
Weighted average number of common shares outstanding:
Basic 85,451,978 82,220,410 84,975,917 78,233,731
Diluted 85,617,851 82,372,022 85,137,833 78,233,731
 
Comprehensive Income:
Net income $ 35,338 $ 24,137 $ 26,601 $ 13,333
Other comprehensive loss:
Unrealized loss on interest rate instruments   (4,695 )   -   (4,695 )   -  
Comprehensive income 30,643 24,137 21,906 13,333
Noncontrolling interests:
Redeemable noncontrolling interest in loss of consolidated entity - - - 2
Noncontrolling interests of common units in Operating Partnership   (114 )   -   (92 )   -  
Comprehensive (income) loss attributable to noncontrolling interests   (114 )   -   (92 )   2  
Comprehensive income attributable to the Company $ 30,529   $ 24,137 $ 21,814   $ 13,335  
 
 
LASALLE HOTEL PROPERTIES
FFO and EBITDA
(in thousands, except share/unit data)
(unaudited)
       
 
For the three months ended For the six months ended
June 30, June 30,
  2012     2011     2012     2011  
 
Net income (loss) attributable to common shareholders $ 24,792 $ 16,735 $ 8,675 $ (2,544 )
Depreciation 31,135 27,873 61,147 55,550
Amortization of deferred lease costs 88 74 174 156
Noncontrolling interests:
Redeemable noncontrolling interest in consolidated entity - - - (2 )
Noncontrolling interests of common units in Operating Partnership   130     -     108     -  
FFO $ 56,145 $ 44,682 $ 70,104 $ 53,160
 
Management transition costs 801 - 926 -
Preferred share issuance costs 4,417 - 4,417 731
Acquisition transaction costs 307 245 3,901 421
Costs associated with CFO departure - - - 579
Non-cash ground rent   114     116     228     116  
Adjusted FFO $ 61,784   $ 45,043   $ 79,576   $ 55,007  
 

Weighted average number of common shares and units outstanding:

Basic 85,748,278 82,220,410 85,272,217 78,233,731
Diluted 85,914,151 82,372,022 85,434,133 78,425,976
 
FFO per diluted share/unit $ 0.65 $ 0.54 $ 0.82 $ 0.68
 
Adjusted FFO per diluted share/unit $ 0.72 $ 0.55 $ 0.93 $ 0.70
 
 
For the three months ended For the six months ended
June 30, June 30,
  2012     2011     2012     2011  
 
Net income (loss) attributable to common shareholders $ 24,792 $ 16,735 $ 8,675 $ (2,544 )
Interest expense 12,503 9,928 24,281 19,710
Income tax expense (1) 4,969 5,087 1,977 2,413
Depreciation and amortization 31,279 27,999 61,431 55,807
Noncontrolling interests:
Redeemable noncontrolling interest in consolidated entity - - - (2 )
Noncontrolling interests of common units in Operating Partnership 130 - 108 -
Distributions to preferred shareholders   5,999     7,402     13,401     15,148  
EBITDA $ 79,672 $ 67,151 $ 109,873 $ 90,532
 
Management transition costs 801 - 926 -
Preferred share issuance costs 4,417 - 4,417 731
Acquisition transaction costs 307 245 3,901 421
Costs associated with CFO departure - - - 579
Non-cash ground rent   114     116     228     116  
Adjusted EBITDA $ 85,311 $ 67,512 $ 119,345 $ 92,379
 
Corporate expense 5,479 4,717 10,814 9,840
Interest and other income (1,299 ) (1,231 ) (2,465 ) (2,478 )
Hotel level adjustments, net   (433 )   11,943     (1,764 )   15,525  
Hotel EBITDA $ 89,058   $ 82,941   $ 125,930   $ 115,266  

 

(1) Includes amounts from discontinued operations.
 
With respect to Hotel EBITDA, the Company believes that excluding the effect of corporate-level expenses, non-cash items, and the portion of these items related to unconsolidated entities, provides a more complete understanding of the operating results over which individual hotels and operators have direct control. We believe property-level results provide investors with supplemental information on the ongoing operational performance of our hotels and effectiveness of the third-party management companies operating our business on a property-level basis.
 
 
Hotel EBITDA includes all properties owned as of June 30, 2012 for the Company's period of ownership in 2012 and the comparable period in 2011. Exceptions: Hotel EBITDA excludes March period of ownership for Hotel Palomar, Washington, DC. Hotel EBITDA for all stated periods excludes any properties the Company has sold.
 
 
LASALLE HOTEL PROPERTIES
Hotel Operational Data
Schedule of Property Level Results
(in thousands)
(unaudited)
       
For the three months ended For the six months ended
June 30, June 30,
  2012   2011   2012   2011
Revenues:
Room $ 167,202 $ 160,593 $ 280,139 $ 265,654
Food and beverage 58,714 58,943 102,901 102,524
Other   14,528   13,958   25,975   24,459
Total hotel revenues   240,444   233,494   409,015   392,637
 
Expenses:
Room 38,448 38,118 71,952 69,939
Food and beverage 39,399 39,724 73,329 73,278
Other direct 5,540 5,761 10,111 10,236
General and administrative 17,272 16,669 32,495 31,453
Sales and marketing 14,846 14,357 28,303 26,716
Management fees 8,456 8,564 13,030 13,112
Property operations and maintenance 7,811 7,706 15,322 14,761
Energy and utilities 5,853 6,078 11,558 11,839
Property taxes 9,808 9,680 19,497 19,006
Other fixed expenses   3,953   3,896   7,488   7,031
Total hotel expenses   151,386   150,553   283,085   277,371
 
Hotel EBITDA $ 89,058 $ 82,941 $ 125,930 $ 115,266
 
Note:
This schedule includes operating data for all properties owned as of June 30, 2012 for the Company's period of ownership in 2012 and the comparable period in 2011. Exceptions: The schedule excludes the March period of ownership for Hotel Palomar, Washington, DC. All stated periods exclude any properties the Company has sold. Hotel EBITDA margin is calculated by dividing hotel EBITDA for the period by the total hotel revenues for the period.
 
 
LASALLE HOTEL PROPERTIES
Statistical Data for the Hotels
(unaudited)
           
For the three months ended For the six months ended
June 30, June 30,
2012 2011 2012 2011
Total Portfolio
Occupancy 83.4% 85.1% 77.7% 77.8%
Decrease (2.0%) (0.1%)
ADR $215.92 $204.01 $198.07 $189.02
Increase 5.8% 4.8%
RevPAR $180.14 $173.61 $153.97 $147.08
Increase 3.8% 4.7%
 
  Note:
This schedule includes operating data for all properties owned as of June 30, 2012 for the Company's period of ownership in 2012 and the comparable period in 2011. All stated periods exclude any properties the Company has sold.
 

Photos/Multimedia Gallery Available: http://www.businesswire.com/cgi-bin/mmg.cgi?eid=50345386&lang=en



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