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Xenia Hotels & Resorts reports Q2 2016 results

Aug 05, 2016

ORLANDO, FL - Xenia Hotels & Resorts, Inc today announced results for the quarter ended June 30, 2016.

Second Quarter 2016 Highlights

• Net Income: Net income attributable to common stockholders was $25.8 million and net income per share was $0.24.

• Same-Property RevPAR: Same-Property RevPAR increased 1.8% from the second quarter of 2015 to $162.47, as occupancy remained flat and ADR increased 1.8%. Excluding hotels located in Houston, Same-Property RevPAR increased 3.8% from the second quarter of 2015, as occupancy increased 63 basis points and ADR increased 3.0%.

• Same-Property Hotel EBITDA Margin: Same-Property Hotel EBITDA Margin was 36.3%, an increase of 115 basis points from the same period in 2015.

• Total Portfolio RevPAR: Total portfolio RevPAR was 8.3% higher than in the second quarter of 2015, reflecting portfolio performance, as well as changes in portfolio composition.

• Adjusted EBITDA: Adjusted EBITDA increased $7.7 million to $88.0 million, an increase of 9.6% over the second quarter of 2015.

• Adjusted FFO per Diluted Share: Adjusted FFO available to common stockholders increased to $0.65 per diluted share compared to $0.57 per diluted share for the second quarter of 2015, an increase of 14.0%.

• Transaction Activity: During the quarter, the Company completed the sale of four hotels for a gross price of $136 million.

• Financing Activity: In June, the Company paid off one $22 million mortgage loan.

• Dividends: The Company declared its second quarter dividend of $0.275 per share to common stock and unit holders of record on June 30, 2016.

Year to Date Results

For the six months ended June 30, 2016, net income attributable to common stockholders was $17 million, a 90.0% increase over the same period prior year, due largely to one-time separation and other start-up related expenses in 2015, offset by the provision for asset impairment and loss on debt extinguishment incurred during 2016.

Same-Property RevPAR increased 1.3% from the first half of 2015 to $151.54, as occupancy declined 79 basis points and ADR increased 2.4%. The Company's Same-Property Hotel EBITDA margin was 33.3%, which improved 26 basis points compared to the same period prior year. The Company's Adjusted EBITDA and Adjusted FFO per diluted share increased 3.7% and 5.9%, respectively, during the first half of 2016 as compared to the same period in 2015.

"We continue to be focused on our strategy of owning and further improving a high-quality, diversified portfolio of hotels, executing our differentiated approach to portfolio management and maintaining a strong financial profile," said Marcel Verbaas, President and Chief Executive Officer of Xenia. "While the dynamics in the Houston market continue to be unfavorable, we were able to generate 1.8% Same-Property portfolio RevPAR growth in the second quarter, as our Same-Property portfolio excluding our Houston area assets achieved a healthy 3.8% RevPAR increase. Our continued efforts to contain costs and optimize our portfolio through unique property initiatives resulted in margin growth of 115 basis points during the quarter, in part due to refunds related to real estate tax appeals. We will maintain our focus on cost control and revenue enhancement opportunities as we look cautiously into the second half of the year and anticipate a period of relatively muted RevPAR growth."

"We are particularly pleased with our acquisition and disposition efforts to improve our portfolio over the past year, as demonstrated by the fact that total portfolio RevPAR during the second quarter exceeded prior year by 8.3%. We have been able to achieve this while further strengthening our balance sheet, resulting in a net senior capital to EBITDA ratio that is among the lowest of our peer group," Mr. Verbaas continued.

"The completion of nearly $310 million of dispositions since last fall has allowed us to maintain this conservative leverage profile, while also providing us with the ability to return capital to our investors through the execution of our share repurchase program. The fact that we were able to sell six hotels on the lower end of the portfolio at a weighted average multiple of 10.8x 2015 EBITDA speaks to the value of our portfolio, particularly when taking into account that this excludes approximately $90 million of total near-term capital investments that we were able to avoid as a result of these dispositions. Adjusted for this required near-term capital, the combined sales price represented a 13.9x 2015 EBITDA multiple."

Xenia Hotels & Resorts reports Q2 2016 results

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