Dallas, Texas (October 3, 2002) - La Quinta Corporation (NYSE: LQI) announced today it is updating third quarter earnings guidance based on weaker-than-expected lodging revenues. La Quinta now anticipates that third quarter 2002 lodging EBITDA will be approximately $42 million based on a 4% RevPAR decline. As a result, recurring and cash EPS for the third quarter is anticipated to be below prior guidance.
The Company also announced it had repurchased 863,800 shares of its common stock worth approximately $4 million during the third quarter. La Quinta currently has authorization for $16 million worth of additional stock repurchases.
“Through August, La Quinta’s results were in line with our expectations,” said Francis W. (“Butch”) Cash, President and Chief Executive Officer. “RevPAR declined approximately 4% in July and 5% in August. September, however, was weaker than expected as business travel remained sluggish and leisure travel trailed off from previous trends. RevPAR declined approximately 2% in September as the continued slow economy, coupled with lodging demand weakness during the weeks surrounding the 9/11 anniversary, resulted in significantly lower-than-expected occupancy of approximately 53%. We continue to expect to see positive year-over-year RevPAR and EBITDA growth in the fourth quarter 2002, albeit at lower levels than prior guidance. We will update specific fourth quarter 2002 guidance with the release of our third quarter earnings results.”
Dallas-based La Quinta Corporation (NYSE: LQI), a leading limited service lodging company, owns, operates or franchises over 330 La Quinta Inns and La Quinta Inn & Suites in 33 states. Today`s news release, as well as other information about La Quinta, is available on the Internet at www.LQ.com.
Certain matters discussed in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “believes,” “anticipates,” “expects,” “intends,” “estimates,” “projects” and other similar expressions, which are predictions of or indicate future events and trends, typically identify forward-looking statements. Our forward-looking statements are subject to a number of risks and uncertainties which could cause actual results or the timing of certain events to differ materially from those projected in or contemplated by the forward-looking statements. Accordingly, we cannot assure you that the expectations set forth in these forward-looking statements will be attained. Some of the factors that could cause actual results or the timing of certain events to differ from those described in these forward-looking statements include, without limitation, our ability to successfully grow the revenues and profitability of our lodging business and franchising program; our ability to realize sustained labor or other cost savings; the availability and costs of insurance for our properties and business; competition within the lodging industry, including in the franchising of the La Quinta® brand; our ability to generate attractive rates of return on new lodging investments; the cyclicality of the lodging business; the continued unpredictable results of the events of September 11, 2001 on our business; the effects of the general economic slowdown, including decreases in consumer confidence and business spending, which may continue to adversely affect our business and industry; interest rates; the ultimate outcome of litigation filed against us; the availability of capital for corporate purposes including for debt repayment, acquisitions and capital expenditures; the conditions of the capital markets in general; our ability to continue to successfully sell additional lodging assets; and other risks detailed from time to time in our filings with the Securities and Exchange Commission, including, without limitation, the risks described in our Joint Annual Report on Form 10-K for the year ended December 31, 2001 entitled “Certain Factors You Should Consider About Our Companies, Our Businesses and Our Securities”. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.