Press Release: Wyndham International, Inc.
November 7, 2001
DALLAS, TX -- Wyndham International, Inc. (NYSE:WYN) yesterday reported results for the third quarter and nine
months ended Sept. 30, 2001.
The terrorist attacks caused a decline in occupancy in many of Wyndham International's key markets and contributed
to an 8.4 percentage point drop in comparable owned and leased hotels' occupancy for the third quarter. As a result,
the portfolio also had a decline of 7.0% in average daily rate (ADR) and 17.1% decline in revenue per available
room (RevPAR) for the third quarter. For the nine months ended Sept. 30, 2001, occupancy at comparable owned and
leased properties was down 4.1 percentage points, with ADR down 0.5% and RevPAR down 5.8%.
According to Smith Travel Research, the upper-upscale hotel category experienced a RevPAR loss of 9.0% year-to-date
through September; compared to a 7.2% RevPAR decline at Wyndham-branded owned, leased and managed hotels for the
same period. Similarly, Summerfield Suites by Wyndham experienced a year-to-date RevPAR decline of 4.1%, versus
the extended stay industry RevPAR decline of 6.9%.
On a pro forma basis, which reflects adjustments for asset acquisitions and dispositions, earnings before interest,
taxes, depreciation and amortization (EBITDA), as adjusted, was $71.9 million in the third quarter of 2001, down
from $122.2 million for the same quarter last year. The company reported a net loss of $83.9 million for the quarter
on a pro forma basis, an improvement of $34.3 million versus the same period in the prior year. The company reported
a loss of $0.67 per diluted share, compared to a loss of $0.86 per diluted share for the same quarter last year.
Wyndham initiated cost containment programs in March in response to economic uncertainty, with further reductions
in May and July. Despite the substantial decline in revenue following the September 11 attacks, Wyndham achieved
a 50.5% flow through on decremental revenues to EBITDA during the third quarter, reflecting the effectiveness of
the cost containment initiatives.
``We proactively streamlined operating costs which delivered a strong flow through,'' stated Fred J. Kleisner,
chairman and chief executive officer of Wyndham International. ``Given the unique and very difficult circumstances
that arose this quarter, we are pleased that the Wyndham brand is gaining market share.''
Occupancies have improved substantially since September 11 from a low of 38% occupancy the week of September 17
to the mid-60's for the week of October 28. Wyndham has a breakeven occupancy of approximately 55% to cover operating
costs as well as debt service.
Wyndham maintains a solid cash position with access to a revolving credit line through its banking relationships.
Following the September 11 attacks, Wyndham's lender group waived certain financial covenants during the third
and fourth quarters. To reflect the emerging new operating environment, the company and its lenders are currently
working on a long-term amendment targeted for completion before Feb. 28, 2002.
``We continue to see occupancies in the low to mid 60's for the overall company. In October, over 80% of our owned
and leased portfolio sustained occupancies above 55%, and 30% of the hotels achieving occupancies of 70% and greater,''
continued Kleisner. ``With our credit facility waiver in place and our amendment process underway we are aggressively
focused on managing the business and will continue to do so.''
The company continues to make progress with its three-year plan to focus on proprietary branded operations. Year-to-date,
the company has sold $212 million in non-strategic assets, including the Ambassador West hotel in Chicago sold
in October. All of the sale proceeds were used to reduce debt. The Wyndham brand also expanded in third quarter
with six new franchise and management contracts: the Wyndham Pittsburgh Airport; the Wyndham Sapphire Beach Club
and Resort in St. Maarten; The Kelly House and The Harbor View, Wyndham Luxury Resorts in Martha's Vineyard Mass.;
the Wyndham Palm Springs; and The St. Anthony -- A Wyndham Historic Hotel in San Antonio, Texas.
The Wyndham Newark Airport is planned to open at the end of 2001; and the recently opened Golden Door Spa at The
Boulders -- A Wyndham Luxury Resort in Carefree, Ariz., is driving renewed demand for the property.
Wyndham International, Inc. offers upscale and luxury hotel and resort accommodations through proprietary lodging
brands and a management services division. Based in Dallas, Wyndham International owns, leases, manages and franchises
hotels and resorts in the United States, Canada, Mexico, the Caribbean and Europe. For more information, visit
www.wyndham.com. For reservations, call 800/WYNDHAM.
Cautionary Statement
This press release contains certain forward-looking statements within the meaning of Sections 27A of the Securities
Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including projections about future operating
results. The company's results could differ materially from those set forth in the forward-looking statements.
Certain factors that might cause a difference include, but are not limited to, risks associated with the availability
of equity or debt financing at terms and conditions favorable to Wyndham; risks associated with the course of litigation;
Wyndham's ability to effect sales of assets on favorable terms and conditions; Wyndham's ability to integrate acquisitions
into its operations and management; risks associated with the hotel industry and real estate markets in general;
competition within the lodging industry; the impact of general economic conditions; risks associated with debt
financing; the impact of terrorists' activity, threats of terrorist activity and responses thereto on the economy
in general and the travel and hotel industries in particular; and other risks and uncertainties set forth in the
company's annual, quarterly and current reports, and proxy statements.
WYNDHAM INTERNATIONAL, INC.
2001 OPERATING STATISTICS BY QUARTER
Quarter Ended September 30
--------------------------
2001 2000 % Change
---- ---- --------
COMPARABLE WYNDHAM BRANDED HOTELS (a)
Wyndham Hotels & Resorts
Average daily rate $111.12 $118.40 -6.1%
Occupancy 65.5% 72.8% -730 ppt
RevPAR $72.75 $86.18 -15.6%
Wyndham Luxury Resorts (b)
Average daily rate $175.40 $229.79 -23.7%
Occupancy 51.2% 54.6% -340 ppt
RevPAR $89.81 $125.38 -28.4%
Summerfield by Wyndham
Average daily rate $117.53 $125.34 -6.2%
Occupancy 78.9% 88.9% -1000 ppt
RevPAR $92.77 $111.46 -16.8%
Wyndham Garden
Average daily rate $82.22 $83.00 -0.9%
Occupancy 61.3% 70.0% -870 ppt
RevPAR $50.41 $58.14 -13.3%
Nine Months Ended September 30
------------------------------
2001 2000 % Change
---- ---- --------
COMPARABLE WYNDHAM BRANDED HOTELS (a)
Wyndham Hotels & Resorts
Average daily rate $134.21 $132.39 1.4%
Occupancy 69.5% 73.1% -360 ppt
RevPAR $93.32 $96.80 -3.6%
Wyndham Luxury Resorts (b)
Average daily rate $253.95 $283.24 -10.3%
Occupancy 55.9% 58.4% -250 ppt
RevPAR $141.99 $165.52 -14.2%
Summerfield by Wyndham
Average daily rate $122.93 $124.09 -0.9%
Occupancy 79.9% 84.1% -420 ppt
RevPAR $98.19 $104.35 -5.9%
Wyndham Garden
Average daily rate $87.21 $85.41 2.1%
Occupancy 66.8% 70.4% -360 ppt
RevPAR $58.29 $60.18 -3.1%
Quarter Ended September 30
--------------------------
2001 2000 % Change
---- ---- --------
COMPARABLE OWNED & LEASED HOTELS
Proprietary Branded (c)
Average daily rate $114.34 $123.68 -7.6%
Occupancy 68.8% 77.1% -830 ppt
RevPAR $78.62 $95.30 -17.5%
Non-Proprietary Branded (d)
Average daily rate $117.47 $120.30 -2.4%
Occupancy 69.9% 79.0% -910 ppt
RevPAR $82.15 $95.03 -13.6%
Total Portfolio
Average daily rate $114.66 $123.32 -7.0%
Occupancy 68.9% 77.3% -840 ppt
RevPAR $78.98 $95.27 -17.1%
Assets Held for Sale
Average daily rate $101.64 $106.54 -4.6%
Occupancy 64.0% 72.5% -850 ppt
RevPAR $65.08 $77.32 -15.8%
COMPARABLE OWNED & LEASED HOTELS
Proprietary Branded (c)
Average daily rate $135.52 $136.76 -0.9%
Occupancy 73.0% 76.9% -390 ppt
RevPAR $98.93 $105.21 -6.0%
Non-Proprietary Branded (d)
Average daily rate $126.57 $123.45 2.5%
Occupancy 72.4% 77.5% -510 ppt
RevPAR $91.59 $95.67 -4.3%
Total Portfolio
Average daily rate $134.50 $135.22 -0.5%
Occupancy 72.9% 77.0% -410 ppt
RevPAR $98.08 $104.11 -5.8%
Assets Held for Sale
Average daily rate $107.00 $107.95 -0.9%
Occupancy 66.3% 71.5% -520 ppt
RevPAR $70.96 $77.16 -8.0%
NOTE: All hotel statistics exclude assets sold to date.
(a) Brand statistics are based on comparable owned, managed and
leased hotels for respective periods.
(b) Reflects results of the Boulders, Carmel Valley Ranch, the
Lodge at Ventana Canyon, and Isla Navidad.
(c) Reflects Wyndham Hotels & Resorts, Wyndham Luxury Resorts,
Summerfield by Wyndham and Wyndham Garden Hotels that were
branded as of January 1, 2000.
(d) Non-proprietary brand hotels owned by the Company as of
January 1, 2000. Excludes assets Held for Sale.
WYNDHAM INTERNATIONAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(in thousands)
(Unaudited)
Quarter Ended
September 30,
------------------------------------------
2001 2000 2001 2000
Comparable Comparable
Pro Forma Pro Forma Actual Actual
------------------------------- ---------
Revenues:
Hotel revenues $ 439,917 $ 527,683 $ 439,917 $ 560,911
Management fees and
service fee income 4,319 7,199 6,431 9,215
Interest and other income 2,065 4,204 2,441 4,340
--------- --------- --------- ---------
Total revenues 446,301 539,086 448,789 574,466
--------- --------- --------- ---------
Expenses:
Hotel expenses 354,914 398,325 354,914 423,831
General and administrative
costs 15,808 16,422 15,808 16,439
Interest expense 78,752 90,800 78,752 95,333
--------- --------- --------- ---------
Total operating costs
and expenses 449,474 505,547 449,474 535,603
--------- --------- --------- ---------
Revenues net of direct
expenses (3,173) 33,539 (685) 38,863
Non-recurring charges:
Reductions in reservation
and marketing funds 5,239 -- 5,239 --
Professional fees and other 3,087 3,504 3,087 3,504
Abandoned transaction costs 925 1,442 925 1,442
Pre-opening expenses 1,215 (113) 1,215 --
Loss on derivative
instruments 37,694 -- 37,694 --
Impairment of assets
held for sale -- 134,016 -- 134,016
Loss (gain) on sale
of assets 1,715 (9,305) 1,715 (9,305)
Write-off of management
and leasehold costs 17,019 -- 17,019 --
------------------------------------------
Total non-recurring
charges 66,894 129,544 66,894 129,657
------------------------------------------
Depreciation and
amortization 60,101 73,254 60,101 79,631
Equity in (earnings) losses
from unconsolidated
subsidiaries (891) 121 (1,534) (1,518)
Minority interest in
consolidated subsidiaries 1,555 1,027 1,555 2,384
------------------------------------------
60,765 74,402 60,122 80,497
------------------------------------------
Loss before income taxes (130,832) (170,407) (127,701) (171,291)
Benefit for income taxes (48,003) (52,141) (46,751) (51,952)
Extraordinary item, net
of applicable taxes 1,119 -- 1,119 --
--------- --------- --------- ---------
Net loss $ (83,948) $(118,266) $ (82,069) $(119,339)
========= ========= ========= =========
EBITDA, as adjusted $ 71,856 $ 122,234 $ 75,162 $ 132,289
========= ========= ========= =========
WYNDHAM INTERNATIONAL, INC.
EBITDA Reconciliation
(in thousands, except per share data)
(Unaudited)
Quarter Ended
September 30,
----------------------------------------------
2001 2000 2001 2000
Comparable Comparable
Pro Forma Pro Forma Actual Actual
----------- ----------- ----------- ----------
EBITDA Reconciliation
Net loss $ (83,948) $ (118,266) $ (82,069) $ (119,339)
Interest expense 78,752 90,800 78,752 95,333
Depreciation and
amortization 60,101 73,254 60,101 79,631
Benefit for income
taxes (48,003) (52,141) (46,751) (51,952)
Extraordinary item,
net of applicable taxes 1,119 -- 1,119 --
----------- ----------- ----------- ----------
EBITDA 8,021 (6,353) 11,152 3,673
Interest, depreciation
and amortization from
equity interest in
unconsolidated
subsidiaries 1,055 971 1,077 1,525
Interest, depreciation
and amortization
attributable to
minority interests (756) (1,928) (603) (2,566)
Reductions in
reservation and
marketing funds 5,239 -- 5,239 --
Professional fees
and other 3,087 3,504 3,087 3,504
Abandoned transaction
costs 925 1,442 925 1,442
Pre-opening expenses 1,215 (113) 1,215 --
Amortization of unearned
compensation 674 -- 674 --
Loss on derivative
instruments 37,694 -- 37,694 --
Impairment of assets
held for sale -- 134,016 -- 134,016
Non-recurring fees
included in G&A 573 -- 573 --
Loss (gain) on sale
of assets 1,715 (9,305) 1,715 (9,305)
Write-off of management
and leasehold costs 12,414 -- 12,414 --
----------- ----------- ----------- ----------
EBITDA, as adjusted $ 71,856 $ 122,234 $ 75,162 $132,289
=========== =========== =========== ==========
Per Share Calculations:
Net loss $ (83,948) $ (118,266) $ (82,069) $ (119,339)
Adjustment for
preferred stock (27,998) (26,099) (27,998) (26,099)
Net loss attributable
to common
shareholders $ (111,946) $ (144,365) $(110,067) $ (145,438)
=========== =========== =========== ==========
Net loss per share:
Basic $ (0.67) $ (0.86) $ (0.66) $ (0.87)
Diluted $ (0.67) $ (0.86) $ (0.66) $ (0.87)
Basic weighted average
common shares and
share equivalents 167,810 167,361 167,810 167,361
Diluted weighted
average common shares
and share equivalents 167,810 167,361 167,810 167,361
WYNDHAM INTERNATIONAL, INC.
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(in thousands)
(Unaudited)
Nine Months Ended
September 30,
----------------------------------------------
2001 2000 2001 2000
Comparable Comparable
Pro Forma Pro Forma Actual Actual
---------- ---------- ---------- ----------
Revenues:
Hotel revenues $1,582,275 $1,702,452 $1,625,754 $1,829,984
Management fees and
service fee
income 17,761 21,258 20,633 34,237
Interest and other income 7,905 26,353 7,902 26,866
---------- ---------- ---------- ----------
Total revenues 1,607,941 1,750,063 1,654,289 1,891,087
---------- ---------- ---------- ----------
Expenses:
Hotel expenses 1,167,080 1,221,472 1,200,200 1,312,987
General and
administrative costs 42,170 48,959 42,184 51,264
Interest expense 246,322 266,074 247,439 280,623
---------- ---------- ---------- ----------
Total operating costs
and expenses 1,455,572 1,536,505 1,489,823 1,644,874
---------- ---------- ---------- ----------
Revenues net of direct
expenses 152,369 213,558 164,466 246,213
Non-recurring charges:
Reductions in reservation
and marketing funds 5,239 -- 5,239 --
Professional fees and other 11,592 12,726 11,592 12,726
Abandoned transaction
costs 1,507 3,012 1,507 3,012
Pre-opening expenses 9,324 73 9,324 463
Loss on derivative
instruments 22,018 -- 22,018 --
Impairment of assets held
for sale -- 211,316 -- 211,316
Loss on sale of assets 14,638 4,747 14,638 4,747
Write-off of management
and leasehold costs 17,784 2,448 17,784 2,448
---------- ---------- ---------- ----------
Total non-recurring
charges 82,102 234,322 82,102 234,712
---------- ---------- ---------- ----------
Depreciation and
amortization 177,102 217,568 177,173 238,078
Equity in (earnings)
losses from
unconsolidated
subsidiaries (2,166) 925 (3,131) (5,487)
Minority interest in
consolidated subsidiaries 5,225 2,375 8,507 5,818
---------- ---------- ---------- ----------
180,161 220,868 182,549 238,409
---------- ---------- ---------- ----------
Loss before income taxes (109,894) (241,632) (100,185) (226,908)
Benefit for income taxes (35,726) (79,916) (30,530) (72,649)
Accounting change, net
of applicable taxes 10,364 -- 10,364 --
Extraordinary item, net of
taxes 1,838 -- 1,838 --
---------- ---------- ---------- ----------
Net loss $(86,370) $(161,716) $(81,857) $(154,259)
========== ========== ========== ==========
EBITDA, as adjusted $393,653 $459,023 $404,759 $506,137
========== ========== ========== ==========
WYNDHAM INTERNATIONAL, INC.
EBITDA Reconciliation
(in thousands, except per share data)
(Unaudited)
Nine Months Ended
September 30,
------------------------------------------
2001 2000 2001 2000
Comparable Comparable
Pro Forma Pro Forma Actual Actual
------------------------------------------
EBITDA Reconciliation
Net loss $ (86,370) $(161,716) $(81,857) $(154,259)
Extraordinary item,
net of taxes 1,838 - 1,838 -
Interest expense 246,322 266,074 247,439 280,623
Depreciation and
amortization 177,102 217,568 177,173 238,078
Benefit for income taxes (35,726) (79,916) (30,530) (72,649)
Accounting change, net of
applicable taxes 10,364 - 10,364 -
--------- -------- -------- --------
EBITDA 313,530 242,010 324,427 291,793
Interest, depreciation and
amortization from equity
interest in unconsolidated
subsidiaries 3,125 3,185 3,865 2,181
Interest, depreciation and
amortization attributable
to minority interests (2,865) (6,720) (3,396) (8,775)
Reductions in reservation
and marketing funds 5,239 - 5,239 -
Professional fees and other 11,592 12,726 11,592 12,726
Abandoned transaction costs 1,507 3,012 1,507 3,012
Pre-opening expenses 9,324 73 9,324 463
Amortization of unearned
compensation 1,450 704 1,450 704
Loss on derivative
instruments 22,018 - 22,018 -
Impairment of assets held for
sale - 211,316 - 211,316
Bedrock termination fees - (14,478) - (14,478)
Non-recurring fees included in
general and administrative
costs 916 - 916 -
Loss on sale of assets 14,638 4,747 14,638 4,747
Write-off of management and
leasehold costs 13,179 2,448 13,179 2,448
-----------------------------------------
EBITDA, as adjusted $ 393,653 $ 459,023 $404,759 $ 506,137
=========================================
Per Share Calculations:
Net loss $ (86,370) $(161,716) $(81,857) $(154,259)
Adjustment for preferred
stock (82,529) (76,968) (82,529) (76,968)
--------- -------------------- --------
Net loss attributable to
common shareholders $(168,899) $(238,684) $(164,386) $(231,227)
========= ==================== ========
Net loss per share:
Basic $ (1.01) $ (1.43) $ (0.98) $ (1.38)
Diluted $ (1.01) $ (1.43) $ (0.98) $ (1.38)
Basic weighted average
common shares and share
equivalents 167,644 167,272 167,644 167,272
Diluted weighted average
common shares and share
equivalents 167,644 167,272 167,644 167,272
-----------------------------------------------------
Contact:
Wyndham International, Inc., Dallas
Analyst Inquiries:
Elizabeth Williams, 214/863-1389
ewilliams@wyndham.com
or
Media Inquiries:
Andrew Jordan, 214/863-1360
ajordan@wyndham.com