HPT Announces 2002 First Quarter Operating Results
NEWTON, Mass.–(BUSINESS WIRE)–May 6, 2002–Hospitality Properties Trust (NYSE: HPT) today announced its results of operations for the quarter ended March 31, 2002, as follows:
(amounts in thousands, except per share amounts)
Quarter Ended
March 31,
2002 2001
Net income $33,331 $30,088
Net income available for
common shareholders $31,550 $28,307
Funds from operations (FFO) $59,388 $55,999
Cash available for distribution (CAD) $50,725 $46,678
Common distributions $44,386 $39,554
Per common share amounts:
Net income available for common
shareholders $ 0.50 $ 0.50
Funds from operations (FFO) $ 0.95 $ 0.99
Cash available for distribution (CAD) $ 0.81 $ 0.83
Common distributions $ 0.71 $ 0.70
Weighted average common shares
outstanding 62,520 56,495
Hospitality Properties Trust is a REIT headquartered in Newton,
Massachusetts which invests in hotels. HPT currently has investments
of approximately $2.7 billion in 251 hotels located in 37 states.
Quarter Quarter
Ended Ended
March 31, March 31,
2002 2001
Revenues:
Minimum rent $58,347 $59,402
Hotel operating revenues (1) 18,139 —
FF&E reserve income (2) 5,266 6,409
Interest income 182 362
Total revenues 81,934 66,173
Expenses:
Hotel operating expenses (1) 11,169 —
Interest (including amortization
of deferred financing costs of
$605 and $603, respectively) 10,047 10,186
Depreciation and amortization 23,734 22,138
General and administrative 3,653 3,761
Total expenses 48,603 36,085
Net income 33,331 30,088
Preferred distributions 1,781 1,781
Net income available for common
shareholders $31,550 $28,307
Net income available for common
shareholders $31,550 $28,307
Add: FF&E deposits not in net income (2) 3,439 3,859
Depreciation and amortization 23,734 22,138
Deferred percentage rent (3) 665 1,695
Funds from operations (FFO) $59,388 $55,999
FFO $59,388 $55,999
Add: Non-cash expenses 985 947
Less: FF&E reserve income (1) (2) 6,209 6,409
FF&E deposits not in net income (2) 3,439 3,859
Cash available for distribution (CAD) $50,725 $46,678
Weighted average common shares outstanding 62,520 56,495
Per common share amounts:
Net income available for common
shareholders $ 0.50 $ 0.50
FFO $ 0.95 $ 0.99
CAD $ 0.81 $ 0.83
Common distributions declared $ 0.71 $ 0.70
(1) All of our hotels are leased to or operated by third-parties;
HPT does not operate hotels. At various times during 2001, 16 of our
hotels, containing 2,380 rooms, began to be operated by Marriott
International under a long-term management contract; most of these
hotels were previously leased to Marriott. These hotels are now leased
to a 100% subsidiary of ours, as allowed by the REIT Modernization Act
which became effective in 2001. Although our long-term management
contract with Marriott includes security features which are similar to
those under our leases, after a property begins to be operated under a
management contract rather than under a lease, our consolidated
revenues include hotel sales rather than rental income and our
expenses include hotel operating expenses. We have agreed to this new
arrangement for a total of 35 hotels, containing 5,382 rooms and
expect it to begin for the remaining 19 hotels during 2002. For the
2002 first quarter, the 16 hotels leased to our subsidiary tenant
generated net revenues over expenses and FF&E escrows, as follows:
First Quarter
Hotel operating revenues $18,139
Less: Hotel operating expenses 11,169
Net payments by our manager to our subsidiary tenant 6,970
Less: Payments made into FF&E Reserve escrows 943
Net $ 6,027
(2) Some of the HPT leases provide that FF&E Reserve escrows are
owned by HPT. Other leases provide that FF&E Reserve escrows are owned
by the tenant and HPT has a security and remainder interest in the
escrow account. When HPT owns the escrow, generally accepted
accounting principles require that payments into the escrow be
reported as additional rent. When HPT has a security and remainder
interest in the escrow account, deposits are not included in revenue
but are included in FFO. CAD excludes all FF&E Reserves.
(3) The Company recognizes percentage rental income received for
the first, second and third quarters in the fourth quarter. Although
recognition of revenue is deferred for purposes of calculating net
income, the calculations of FFO and CAD include amounts received with
respect to the periods shown.
Hospitality Properties Trust
Key Property Statistics(a)
1st Quarter 1st Quarter Change
2002 2001
Hotel Statistics
(34,007 rooms and 228 hotels):
Average Daily Rate (ADR) $84.16 $92.58 -9.1%
Occupancy 68.9% 72.8% -3.9 pts
Revenue per Available Room (RevPAR) $57.99 $67.40 -14.0%
(a) Excludes 2 properties containing 277 rooms, not open for a
full year as of January 1, 2002.
Key Balance Sheet Statistics
March 31, 2002 Dec. 31, 2001
Cash $ 32,846,000 $ 38,962,000
Real Estate, at cost $2,632,197,000 $2,629,153,000
Debt
Fixed rate – 8.25% Senior Notes,
due 2005 $ 115,000,000 $ 115,000,000
Fixed rate – 7.00% Senior Notes,
due 2008 149,840,000 149,834,000
Fixed rate – 8.50% Senior Notes,
due 2009 150,000,000 150,000,000
Fixed rate – 9.125% Senior Notes,
due 2010 49,949,000 49,947,000
$ 464,789,000 $ 464,781,000
Book Equity
9.5% Preferred (3,000,000 shares
outstanding) $ 72,207,000 $ 72,207,000
Common (62,537,598 and 62,515,940
shares outstanding) 1,520,095,000 1,532,312,000
$1,592,302,000 $1,604,519,000