Extended Stay America, Inc. (NYSE:ESA), a leading provider of extended stay lodging, today reported the results of its operations for the three months ended March 31, 2000. Net income for the first quarter increased by 47% to $11.3 million or $0.12 per diluted share, compared with $7.7 million or $0.08 per diluted share (before the cumulative effect of an accounting change) for the first quarter last year.
Revenue increased by 27% to $113.9 million as compared to $89.4 million for the first quarter last year. Earnings before interest, taxes, depreciation and amortization (EBITDA) of $52.1 million, or $0.54 per diluted share, for the quarter increased by 37% as compared to the first quarter last year. Earnings before depreciation, amortization and deferred taxes (EBDADT) of $31.2 million, or $0.32 per diluted share, for the quarter increased by 27% as compared to the first quarter of last year.
results for the first quarter reflect the opening of 10 properties during the quarter (9 EXTENDED STAYAMERICA Efficiency Studios and 1 StudioPLUS Deluxe Studios). At March 31, 2000, the Company had 372 operating facilities (39 Crossland Economy Studios, 242 EXTENDED STAYAMERICA Efficiency Studios, and 91 StudioPLUS Deluxe Studios) and had 20 facilities under construction (18 EXTENDED STAYAMERICA Efficiency Studios and 2 StudioPLUS Deluxe Studios).The Company expects to open the 20 facilities under construction throughout the remainder of 2000 and to open a total of 30 properties with total costs of approximately $250 million during the year.
Average occupancy rates for Crossland, EXTENDED STAYAMERICA, and StudioPLUS were 74%, 73% and 73%, respectively, while average weekly rates were $213, $305, and $340, respectively, for the first quarter of 2000. Property operating results for the quarter include 6 Crossland properties (15% of open properties), 47 EXTENDED STAYAMERICA properties (19% of open properties), and 14 StudioPLUS properties (15% of open properties) that were open for less than one year at the beginning of the quarter. Including these 67 properties (18% of all opened properties), the Company realized average occupancies of 73% and average weekly room rates of $300 for the quarter. The 305 properties opened for at least one year at the beginning of the first quarter realized average occupancy rates of 74% and average weekly rates of $291 during the quarter.
Facility level EBITDA for the first quarter of 2000, including the 67 properties that were open for less than one year at the beginning of the quarter, was 55% of revenue or $63.0 million, compared to 54% of revenue or $48.4 million for the first quarter of 1999. Facility level EBITDA does not include corporate operating and site selection expenses of $10.9 million which decreased as a percentage of revenue to 10% as compared to 12% for the first quarter of 1999.
As of March 31, 2000, the Company had invested approximately $1.92 billion in the 372 open properties and had invested approximately $105 million in sites under development. The Company had cash balances of approximately $5.5 million and had outstanding loans of $885 million, leaving $113 million available under its credit facilities as of March 31, 2000.
George D. Johnson, Jr., President and CEO, commented: “We continue to benefit from our nationwide development program of the last few years. We are now beginning to realize the full profit potential from over 150 sites that have opened over the past two years and that have experienced normal growth to stabilized operating levels. We believe that we will continue to benefit as we continue our development and gain market share in the extended stay lodging category.”
Certain statements and information included in this release constitute “forward-looking statements” within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements. Additional discussion of factors that could cause actual results to differ materially from management`s projections, forecasts, estimates and expectations is contained in the Company`s SEC filings.