DALLAS, Aug 5, 2003 (BUSINESS WIRE)—Wyndham International, Inc. (AMEX:WBR) Results Summary: Wyndham International, Inc. met its original guidance for second quarter 2003, posting actual EBITDA(a), as adjusted, of $76.1 million, before adjusting for assets sold. The Company`s comparable owned and leased properties that are Wyndham-branded and -operated continue to outperform non-Wyndham-branded properties, posting a RevPAR of $86.82. Wyndham-branded comparable owned and leased properties for the second quarter had a RevPAR penetration index of 107.2 percent, an increase of 180 basis points year-over-year. The Company had a net loss of $91.5 million for the second quarter. After the effect of the preferred dividend, the resulting net loss per share was $0.77 on a fully diluted basis. Despite the challenges of the current economic market, Wyndham continued to improve its occupancy levels and grow market share. During the second quarter, Wyndham continued to sell non-strategic assets to reduce debt while growing the Wyndham brand through new management and franchise agreements.
Wyndham International, Inc. (AMEX:WBR) today reported results for the second quarter ended June 30, 2003.
“The operating strategy we put in place two years ago has continued to generate positive and consistent results for our Company,” stated Fred J. Kleisner, Wyndham International`s chairman and chief executive officer. “Each quarter Wyndham has experienced progressive improvement in our market share, and for the third and fourth quarters 2003, we have implemented market-by-market plans focused on increasing our ADR as we continue to monitor change in the economy.”
On an actual basis, earnings before interest, taxes, depreciation and amortization (EBITDA), as adjusted, was $76.1 million for the three months ending June 30, 2003, consistent with the original guidance, before adjusting for assets sold, of $75.0 million to $80.0 million. On a pro forma basis, EBITDA, as adjusted, was $70.0 million compared to $84.8 million for the same quarter last year. Wyndham reported a net loss of $91.5 million and a pro forma net loss of $27.8 million for the second quarter, versus a $41.4 million net loss and a $43.2 million pro forma net loss for the same period in 2002. After the effect of the Company`s preferred dividend, this resulted in a net loss of $0.77 per share on a fully diluted basis. The net loss on a pro forma basis was $0.39 per share.
Total Company comparable owned and leased revenue per available room (RevPAR), including non-proprietary assets, was $75.79, a decline of 5.4 percent versus the same period in 2002. This decline was comprised of a 0.5 percentage point increase in occupancy and a 6.0 percent decline in average daily rate (ADR).
Leading the Company`s performance, the Wyndham Hotels & Resorts brand for comparable owned and leased properties posted a RevPAR decline of 3.6 percent compared to the prior year. The decline is comprised of a 2.0 percentage point increase in occupancy and a 6.2 percent decline in ADR. The performance of the comparable Wyndham-branded owned and leased properties continues to outperform its non-Wyndham branded properties, posting a RevPAR of $86.82, a decline of 4.1 percent versus the second quarter 2002. The results are comprised of a 2.2 percentage point increase in occupancy and a 6.8 percent decline in ADR. Wyndham-branded owned and leased properties ended the quarter with a RevPAR penetration index of 107.2 percent, a 180 basis point improvement over the same period last year.
Kleisner commented, “The Wyndham brand`s market share gains have been driven by growth in the occupancy index which has captured more business. While this has diluted our ADR, the business adds incremental revenue and EBITDA. As a sustained recovery occurs in the lodging industry, we intend to further gain market share by growing our rate penetration on this expanded occupancy base.”
At the end of the second quarter, liquidity was approximately $200.0 million. The Company defines liquidity as revolver availability, plus cash in our overnight investment account. Wyndham continues to maintain solid liquidity and will continue to manage cash very tightly while making prudent spending decisions given the nation`s current economic conditions.
Before giving effect to the permanent revolver reduction associated with the amendment treatment of asset sales and refinancings, liquidity would be $256 million as compared to $273 million reported for the first quarter. The reduction is due primarily to the payment of fees related to completing the credit facility amendment and the Lehman and Bear Stearns mortgage pool refinancings, which allowed Wyndham to push out all significant 2003 and 2004 loan maturities to 2006 and beyond.
The Company`s total debt was approximately $2.76 billion as of June 30, 2003. The breakdown of the debt at quarter-end was as follows: Revolver $168.7 million; IRL`s $389.5 million; Term Loans $1.09 billion; and Mortgage and Other Indebtedness $1.11 billion.
On May 29, 2003, Wyndham successfully amended its senior corporate credit facilities with a consortium of lenders led by J.P. Morgan Chase, as administrative agent. Pursuant to the terms of the amendments, the maturity date of Wyndham`s increasing rate loans (IRL`s) and revolving credit facility, which were scheduled to mature on June 30, 2004, were extended to April 1, 2006, for the consenting lenders, upon satisfaction of certain conditions. The extensions are subject to the refinancing of the Lehman I mortgage pool and the pay down of the corporate credit facility over a nine month period by approximately $194 million.
On June 11, 2003, Wyndham completed a $425 million mortgage refinancing secured by 19 hotel properties, which refinanced the Lehman I and Bear Stearns mortgage pools. The loan was made by affiliates of Lehman Brothers. The new loan has an initial maturity date of June 9, 2005, and Wyndham, in its sole discretion, may extend the maturity date to July 8, 2008. The refinancing satisfied approximately 65 percent of the pay down required to achieve the maturity extensions under the senior credit facilities amendment. This leaves Wyndham with two property mortgages maturing in 2004 totaling $62.3 million. The Company is confident in its ability to refinance or extend the remaining 2004 maturities.
Kleisner added, “The senior credit facilities amendment and the mortgage refinancing were very significant achievements for Wyndham as we can now focus our efforts on running our business without any significant debt maturities due until 2006. This, coupled with our continued focus on operational initiatives, positions us to take full advantage of the economic recovery when it occurs.”