This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Summit Hotel Properties Reports Third Quarter Results

Stocks in this article: INN


On October 30, 2012, we entered into an agreement with an affiliate of Hyatt Hotels Corporation to fund $20 million in the form of a first lien mortgage loan on a hotel property in downtown Minneapolis, MN. The $20 million represents a portion of the total acquisition and renovation costs expected to be incurred to convert the property to a Hyatt Place hotel. Subject to certain conditions, including the successful conversion of the property estimated to be completed in the summer of 2013, we plan to purchase the property and enter into a management agreement with a Hyatt affiliate.

“We had exceptional performance in the third quarter, exceeding expectations,” said Dan Hansen, president and CEO. “Our RevPAR and EBITDA growth were industry leading. We believe our performance combined with our recent acquisition of nine hotels, our successful follow on common stock offering, and our robust pipeline for future acquisitions position us to provide solid shareholder returns.”

Capital Investments The Company deployed $5.3 million in capital for renovations during the third quarter. The major improvements and capital invested during the third quarter included: Baton Rouge, LA Springhill Suites by Marriott - $0.7 million; Nashville, TN Springhill Suites by Marriott - $0.7 million; Jackson (Ridgeland), MS Homewood Suites - $0.6 million; Baton Rouge, LA Fairfield Inn by Marriott - $0.5 million; Fort Smith, AR Hampton Inn - $0.5 million; El Paso, TX Courtyard by Marriott - $0.4 million; El Paso, TX Hampton Inn & Suites - $0.4 million. Varying in scope, the major improvements listed above include renovation to guestrooms, common areas, and exteriors of the hotels. The Company anticipates deploying up to $11.0 million on renovations and other non-recurring capital expenditures in the fourth quarter.

Dispositions The Company continued its strategy of recycling capital by selling hotels or land that it no longer considers relevant to its strategy of owning hotels with best brands in best markets. In August 2012, the Company sold the 52 room AmericInn Hotel & Suites in Missoula, MT for approximately $1.9 million.

Year-to-Date Highlights For the nine-months ended September 30, 2012, pro forma RevPAR increased 9.9 percent to $68.28 as a result of pro forma ADR growth of 3.5 percent to $96.22 and a 6.2 percent increase in pro forma occupancy to 71.0 percent. RevPAR improvement was the result of the positive effect of recent renovations, the recent rebranding of 10 hotels, and general economic improvement in many of the Company’s markets. Pro forma Hotel EBITDA year to date was $47.6 million, a 17.6 percent increase over the comparable period in 2011. Pro forma Hotel EBITDA margin was 32.9 percent for the period, a 199 basis points margin expansion over the same period in 2011. The Company’s pro forma Hotel EBITDA margin expansion was 243 basis points after adjusting for the $0.6 million one-time hotel management fee concessions agreed to by Interstate Hotels and Resorts during second quarter 2011.

Adjusted EBITDA was $40.7 million for the first nine-months of 2012, a 26.7 percent increase over the same period in 2011.

3 of 6

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 18,030.21 +6.04 0.03%
S&P 500 2,081.88 -0.29 -0.01%
NASDAQ 4,773.4720 +8.0480 0.17%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs