Fairmont Hotels & Resorts Inc. (“FHR”)(TSX/NYSE: FHR) announced today that it has completed the sale of land in Vancouver`s Coal Harbour to the province of British Columbia. The land was acquired for the expansion of the city`s Convention & Exhibition Centre. The purchase price for the land was approximately $18 million (Cdn$27.5 million). As the owner of 75% of the Coal Harbour lands, FHR received gross proceeds of about $13.5 million from this sale, resulting in a gain of approximately $7.5 million.
On January 30, FHR provided first quarter and year-end earnings guidance for 2003. In these estimates, FHR anticipated that this land sale would occur in the second quarter of 2003. As a result, the gain was not included in the first quarter estimates but was incorporated in the full-year guidance. With the closing of this land sale, first quarter EBITDA(1) and earnings per share guidance have been increased by about $7.5 million and $0.095, respectively, but FHR`s full-year earnings estimates are unchanged
FHR is one of North America`s leading owner/operators of luxury hotels and resorts. FHR`s managed portfolio consists of 81 luxury and first-class properties with more than 31,000 guestrooms in Canada, the United States, Mexico, Bermuda, Barbados and the United Arab Emirates. It holds an 83.5% controlling interest in Fairmont Hotels & Resorts (“Fairmont”), North America`s largest luxury hotel management company. Fairmont manages 41 distinctive city center and resort hotels such as The Fairmont San Francisco, The Fairmont Banff Springs, Fairmont Le Chateau Frontenac and The Fairmont Scottsdale Princess. FHR also holds a 100 percent interest in Delta Hotels, Canada`s largest first-class hotel management company, which manages and franchises a portfolio of 39 city center and resort properties in Canada. In addition to hotel management, FHR holds real estate interests in 23 properties, two large undeveloped land blocks and an approximate 35% investment interest in Legacy Hotels Real Estate Investment Trust, which owns 23 properties.
(1) EBITDA is defined as earnings before interest, taxes, amortization, other income and expenses and reorganization and corporate expenses. Income from investments and other is included in EBITDA. Management considers EBITDA to be a meaningful indicator of hotel operations, however, it is not a defined measure of operating performance under Canadian GAAP. FHR`s calculation of EBITDA may be different than the calculation used by other entities.