La Quinta Holdings Inc. (the "Company") (NYSE:LQ) announced that a
Form 10 Registration Statement was filed today with the U.S.
Securities and Exchange Commission (“SEC”) with respect to the
previously announced planned separation of its real estate
business, which is to be named CorePoint Lodging Inc. (“CorePoint
Lodging” or “CorePoint”) from its franchise and management
businesses (“new La Quinta” or “post-spin La Quinta”) creating two
distinct, publicly traded companies.
The registration statement provides information
regarding the business, strategy and historical financial results
of the deemed predecessor entity to CorePoint Lodging, as well as
further details on the anticipated terms of license and management
agreements between CorePoint and new La Quinta following the
planned spin-off. The Company is providing supplemental financial
information in the tables below and in an updated investor
presentation published on its investor relations website
(ir.lq.com). CorePoint Lodging expects to update its registration
statement in subsequent amendments as additional information on the
transactions is finalized prior to the separation.
“The filing of CorePoint Lodging’s Form 10 is an
important next step as we execute against our key strategic
initiatives and drive value for our stakeholders,” said Keith
Cline, La Quinta Holdings Inc.’s President and Chief Executive
Officer. “We believe this separation will result in greater
strategic clarity, with distinct management teams that can fully
activate and run the respective businesses. In addition, we
expect this will allow us to unlock growth opportunities that are
embedded within each business and take advantage of capital market
and tax efficiencies. We look forward to completing this spin
transaction, realizing significant benefits for both companies and
continuing to generate long term value for La Quinta’s
shareholders.”
The New La Quinta: A Market-Leading
Asset-Light, Fee-Based Franchise and Management
Business
Following the spin transaction, the new La
Quinta will continue to benefit from the unique growth
opportunities that currently exist within its franchise and
management businesses. New La Quinta expects to
actively capitalize on the embedded growth opportunity of a large
and growing pipeline, strong interest from developers in expanding
the La Quinta brand into the more than 30% of U.S. markets where
the brand is not yet represented, and a highly scalable property
management platform.
As a stand-alone company, post-spin La Quinta’s
Total Adjusted EBITDA for full year 2017 is estimated to be between
$110 million and $115 million, including fee revenue under ongoing
franchise and management agreements with CorePoint.
As part of the spin transaction, it is expected
that new La Quinta will enter into amended and restated franchise
and management agreements with CorePoint Lodging. These
agreements are expected to provide that CorePoint Lodging will pay
new La Quinta a management fee of 5.0% of gross hotel revenues in
return for day-to-day management of its hotels, and a royalty fee
of 5.0% of gross room revenues. The management agreements are
expected to have an initial term of 20 years with two additional 5
year renewal options, and the franchise agreements are expected to
have an initial term of 20 years with one 10 year renewal
option.
CorePoint Lodging Inc.: Strong
Hotel Portfolio with Significant Potential
Following the spin transaction, CorePoint
Lodging expects to qualify and elect to be treated as a Real Estate
Investment Trust (“REIT”) for federal income tax purposes.
CorePoint Lodging expects to be the only publicly-traded U.S.
lodging REIT strategically focused on serving the midscale and
upper-midscale select-service segments, offering a geographically
diverse portfolio of hotels with significant underlying real estate
value. CorePoint Lodging offers attractive cash flow
characteristics with a strong portfolio consisting of 316 hotels,
excluding three hotels held for sale, with approximately 40,500
rooms located in attractive U.S. locations, including 32%, of its
rooms located within the Top 25 markets as defined by Smith Travel
Research (STR). The hotel portfolio contains assets that are
well-positioned competitively within their markets, located near
major employment centers, airports and transportation
corridors. In addition, CorePoint Lodging will benefit from
the continuation of a long-standing and mutually beneficial
relationship with La Quinta, a highly-recognized and growing brand
with a 49-year history of operating select-service hotels.
As a stand-alone public company, CorePoint’s
Total Adjusted EBITDA for the full year 2017 is estimated to be
between $200 million and $215 million. CorePoint Lodging will have
significant scale and plans to grow and enhance its portfolio
primarily within the highly desirable midscale and upper-midscale
select-service lodging segments.
During 2016, La Quinta identified approximately
50 hotels that will be part of CorePoint’s portfolio that, with the
appropriate scope of capital investment and renovation, have the
opportunity to be repositioned upward within their respective
markets, capturing additional occupancy and rate. Beginning
in the fourth quarter of 2016 and continuing through 2017, La
Quinta expects to invest more than $180 million in these assets
with a focus on enhancing guestrooms, expanding public areas and
upgrading exterior elements. With the majority of these renovations
scheduled to be completed throughout the second half of 2017,
CorePoint Lodging will be a primary beneficiary of these strategic
investments by La Quinta.
Subsequent to the spin transaction, CorePoint
Lodging’s focus will be to generate attractive long-term total
returns by enhancing the value of its properties and utilizing its
scale to efficiently allocate capital while maintaining a strong
and flexible balance sheet.
Capitalization
Subject to market conditions, post-spin La
Quinta and CorePoint Lodging each expect to complete one or more
financing transactions concurrent with or prior to the completion
of the spin-off, including the refinancing of substantially all of
La Quinta’s existing indebtedness. These financing transactions are
expected to be completed at market appropriate terms, including
levels of leverage (approximately 3.5x to 4.5x of trailing twelve
month Total Adjusted EBITDA for new La Quinta and approximately
5.5x to 6.5x of trailing twelve month Total Adjusted EBITDA for
CorePoint). There can be no assurances that any such
financing transactions will be completed in the timeframe or size
indicated or at all.
Transaction Summary
La Quinta plans to execute a spin-off
transaction of its real estate business, CorePoint Lodging, that
will be taxable at both the corporate and shareholder levels, with
the intention that CorePoint Lodging will elect REIT status at the
earliest practical date. This spin transaction will be effected
through a distribution of all of the outstanding shares of
CorePoint Lodging’s common stock to existing La Quinta shareholders
as of the applicable record date. Those shareholders would then own
shares in both companies following the completion of the
transaction. La Quinta’s franchise and management businesses will
continue to operate within the current La Quinta Holdings Inc.
entity, and will maintain the NYSE ticker symbol LQ.
Completion of the spin-off transaction is
subject to a number of conditions, including, among others,
declaration of effectiveness of CorePoint’s Form 10 Registration
Statement filed with the SEC, and other customary matters. Approval
by La Quinta’s shareholders is not required for completion of the
spin-off transaction, although La Quinta’s shareholders have
authorized a reverse stock split of La Quinta’s common stock in
connection with the spin-off.
A copy of the Form 10 Registration Statement is
available for review at www.sec.gov under the name CorePoint
Lodging Inc., and at La Quinta’s investor relations website
ir.lq.com.
J.P. Morgan is acting as financial advisor to La
Quinta Holdings Inc. Simpson Thacher & Bartlett LLP is acting
as legal advisor.
Webcast and Conference Call
La Quinta Holdings Inc. will host a
conference call with analysts on Thursday, July 27,
2017, at 8:30 a.m. Eastern Time. Participants may listen
live by dialing (844) 395-9252, or (478) 219-0505 for international
participants, and enter passcode 58880881, or by logging onto the
La Quinta Investor Relations website
at www.lq.com/investorrelations. Participants are encouraged
to dial into the call or link to the webcast at least fifteen
minutes prior to the scheduled start time.
The replay of the call will be available from
approximately 8:00 p.m. Eastern Time on July 27,
2017, through midnight Eastern Time on August 3,
2017. To access the replay, the domestic dial-in number is (855)
859-2056, the international dial-in number is (404) 537-3406, and
the passcode is 58880881. The archive of the webcast will be
available on the Company's website for a limited time.
Forward-Looking
Statements
This press release contains forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended and Section 21E of the Securities Exchange Act
of 1934, as amended. These statements include, but are not limited
to, statements related to the intended spin-off and its expected
benefits, transactions in connection with the spin-offs (including,
but not limited to, financing transactions), financial projections
for new La Quinta and CorePoint Lodging and other non-historical
statements. You can identify these forward-looking statements by
the use of words such as "outlook," "believes," "expects,"
"potential," "continues," "may," "will," "should," "could,"
"seeks," "projects," "predicts," "intends," "plans," "estimates,"
"anticipates" or the negative version of these words or other
comparable words. Such forward-looking statements are subject to
various risks and uncertainties. Important factors that could cause
results to differ materially from those described in the
forward-looking statements include, but are not limited to: the
fact that executing the spin-off of La Quinta’s real estate
business is contingent upon the satisfaction of a number of
conditions, may require significant time and attention of La
Quinta’s management, and may have a material adverse effect on La
Quinta, whether or not the spin-off is completed; La Quinta may be
unable to achieve some or all of the benefits that it expects to
achieve from the separation; if the proposed separation is
completed, the trading price of La Quinta’s common stock will
decline; following the spin-off, the aggregate value of the common
stock of La Quinta and CorePoint Lodging may be less than the
aggregate value at which La Quinta’s common stock might have traded
prior to any spin-off; and the proposed spin-off could result in
substantial tax liability to La Quinta’s stockholders. Additional
factors that could cause La Quinta’s results to differ materially
from those described in the forward-looking statements can be found
under the section entitled "Part I-Item 1A. Risk Factors" of La
Quinta’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2016 (the “2016 10-K”), filed with the SEC, as such
factors may be updated from time to time in La Quinta’s periodic
filings with the SEC, which are accessible on the SEC's website at
www.sec.gov. Accordingly, there are or will be important factors
that could cause actual outcomes or results to differ materially
from those indicated in these statements. These factors should not
be construed as exhaustive and should be read in conjunction with
the other cautionary statements that are included in this release
and in La Quinta’s filings with the SEC. The Company undertakes no
obligation to publicly update or review any forward-looking
statement, whether as a result of new information, future
developments or otherwise, except as required by law.
The projected information in this press release
gives effect to the spin-off and related transactions as if they
occurred on January 1, 2017 (in the case of Adjusted EBITDA and
related information) and December 31, 2017 (in the case of net
leverage and related information). This projected information is
based on various assumptions, including with regard to: (1) the
terms of the hotel management and franchise agreements between La
Quinta and CorePoint, which agreements have not yet been finalized;
(2) the nature and amount of incremental costs that will be
incurred by CorePoint as an independent public company as compared
to expenses historically allocated to CorePoint’s business and
assets as a part of La Quinta; and (3) the nature and amount of
debt to be incurred, assumed or retired by each entity pursuant to
certain financing transactions expected to be completed on or prior
to the consummation of the spin-off.
The assumptions underlying the projected Total
Adjusted EBITDA and other information in this press release are
subject to various risks and uncertainties, including, among
others: risks inherent to the hospitality and real estate
industries; macroeconomic and other factors beyond the control of
La Quinta and CorePoint; risks related to financing transactions
expected to be consummated in connection with the spin-off; risks
related to competition; risks related to management and franchise
agreements; risks related to doing business with third-party hotel
owners; risks relating to the significant investments in owned real
estate of CorePoint; risks related to performance of information
technology systems; risks related to growth of reservation channels
outside of La Quinta’s system; risks of doing business outside of
the United States for La Quinta; and risks related to La Quinta's
proposed spin-off and related transactions. Any of the foregoing
risks and uncertainties, as well as the additional risk factors
described in the section entitled "Risk Factors" identified in La
Quinta’s 2016 10-K, and the sections entitled “Risk Factors” of the
information statement included in the Form 10 filed by CorePoint,
as such factors may be updated from time to time in subsequent
filings with the SEC, could cause actual outcomes or results to
differ materially from those indicated by the projected information
in this press release.
Non-GAAP Financial Measures
La Quinta refers to certain non-GAAP financial
measures in this press release, including Adjusted EBITDA for La
Quinta and CorePoint. Please see “Management’s Discussion and
Analysis of Financial Condition and Results of Operations—Non-GAAP
Financial Measures” of the information statement included in the
Form 10 filed by CorePoint on July 26, 2017 and in La Quinta’s 2016
10-K and its Form 10-Q for the fiscal quarter ended March 31, 2017
as well as the schedules accompanying this press release for
additional information and reconciliations of such non-GAAP
financial measures for the historical periods presented. In
addition, this press release includes estimated Adjusted Net Income
and Adjusted EBITDA for the year ending December 31, 2017 for La
Quinta and CorePoint. Reconciliations of estimated Adjusted Net
Income and Adjusted EBITDA to measures calculated in accordance
with GAAP are not available without unreasonable effort due to the
unavailability of certain information needed to calculate certain
reconciling items, including impairment charges, gains or losses on
sales of assets, interest expense and income tax expense. For the
same reasons, the Company is unable to address the probable
significance of the unavailable information, which could have a
potentially unpredictable, and potentially significant, impact on
the future GAAP financial results.
About La Quinta
La Quinta Holdings Inc. (LQ) is a leading owner,
operator and franchisor of select‐service hotels primarily serving
the upper‐midscale and midscale segments. The Company’s owned and
franchised portfolio consists of more than 885 hotels representing
approximately 87,500 rooms located in 48 states in the U.S., and in
Canada, Mexico, Honduras and Colombia. These hotels operate
under the Inn & Suites™, Inn™, and LQ Hotel™ brands. ’s
team is committed to providing guests with a refreshing and
engaging experience. For more information, please visit
www.LQ.com.
BASIS OF PRESENTATION AND
RECONCILIATIONS
The tables below provide reconciliations of
CorePoint Lodging and new La Quinta’s Net Income, EBITDA and
Adjusted EBITDA to Net (Loss) Income with respect to the 2017
outlook for each of CorePoint Lodging and new La Quinta, as well as
reconciliations of condensed “stand-alone” statements of operations
for CorePoint Lodging and new La Quinta to the consolidated
statements of operations of La Quinta Holdings Inc. for each of
2016 and 2015. The Company believes this financial information
provides meaningful supplemental information. The Company further
believes the presentation of Adjusted EBITDA and Adjusted Net
Income provides meaningful information because it excludes the
impact of certain special items and/or certain items that are not
expected to have an ongoing effect on its operations. This
represents how management views the business and reviews its
operating performance. It is also used by management when publicly
providing the business outlook.
“EBITDA” and “Adjusted EBITDA.” Earnings before
interest, taxes, depreciation and amortization (“EBITDA”) is a
commonly used measure in many industries. The Company adjusts
EBITDA when evaluating its performance because the Company believes
that the adjustment for certain items, such as restructuring and
acquisition transaction expenses, impairment charges related to
long-lived assets, non-cash equity-based compensation, discontinued
operations, and other items not indicative of ongoing operating
performance, provides useful supplemental information to management
and investors regarding its ongoing operating performance. The
Company believes that EBITDA and Adjusted EBITDA provide useful
information to investors about it and its financial condition and
results of operations for the following reasons: (i) EBITDA
and Adjusted EBITDA are among the measures used by the Company’s
management team to evaluate its operating performance and make
day-to-day operating decisions; and (ii) EBITDA and Adjusted
EBITDA are frequently used by securities analysts, investors,
lenders and other interested parties as a common performance
measure to compare results or estimate valuations across companies
in the Company’s industry.
EBITDA and Adjusted EBITDA are not recognized
terms under GAAP, have limitations as analytical tools and should
not be considered either in isolation or as a substitute for net
(loss) income, cash flow or other methods of analyzing the
Company’s results as reported under GAAP. Some of these limitations
are:
- EBITDA and Adjusted EBITDA do not reflect changes in, or cash
requirements for, working capital needs;
- EBITDA and Adjusted EBITDA do not reflect interest expense, or
the cash requirements necessary to service interest or principal
payments, on its indebtedness;
- EBITDA and Adjusted EBITDA do not reflect tax expense or the
cash requirements to pay taxes;
- EBITDA and Adjusted EBITDA do not reflect historical cash
expenditures or future requirements for capital expenditures or
contractual commitments;
- EBITDA and Adjusted EBITDA do not reflect the impact on
earnings or changes resulting from matters that the Company
considers not to be indicative of its future operations;
- although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized will often have to be
replaced in the future, and EBITDA and Adjusted EBITDA do not
reflect any cash requirements for such replacements; and
- other companies in the Company’s or CorePoint’s industry may
calculate EBITDA and Adjusted EBITDA differently, limiting their
usefulness as comparative measures.
Because of these limitations, EBITDA and Adjusted EBITDA should
not be considered as discretionary cash available to the Company or
CorePoint, as applicable, to reinvest in the growth of its business
or as measures of cash that will be available to the Company or
CorePoint to meet its obligations.
“Adjusted Net Income” is not a recognized term under U.S. GAAP
and should not be considered as an alternative to net (loss) income
or other measures of financial performance or liquidity derived in
accordance with U.S. GAAP. In addition, the Company’s definition of
Adjusted Net Income may not be comparable to similarly titled
measures of other companies.
Adjusted Net Income is included to assist investors in
performing meaningful comparisons of past, present and future
operating results and as a means of highlighting the results of the
Company’s ongoing operations in a comparable format.
|
COREPOINT LODGING ADJUSTED EBITDA NON-GAAP
RECONCILIATIONOUTLOOK: ESTIMATED
2017(unaudited, in millions) |
|
|
|
Year Ending December 31, 2017 |
|
|
Low Case |
|
|
High Case |
Adjusted Net
(Loss) Income (1) |
|
$ |
(9 |
) |
|
$ |
— |
Interest
expense (2) |
|
|
63 |
|
|
|
63 |
Income
tax provision |
|
|
(6 |
) |
|
|
— |
Depreciation and amortization |
|
|
146 |
|
|
|
146 |
EBITDA |
|
|
194 |
|
|
|
209 |
Share
based compensation expense |
|
|
6 |
|
|
|
6 |
Adjusted
EBITDA |
|
$ |
200 |
|
|
$ |
215 |
(1) |
This table
provides a reconciliation of estimated Adjusted EBITDA to estimated
Adjusted Net Income from CorePoint Lodging Inc.’s standalone
results that exclude the impact of certain items that are not
expected to have an ongoing effect on its operations. Also includes
estimated incremental costs of operating as a stand-alone public
company. |
(2) |
Interest
expense represents an allocation of the expected interest expense
for La Quinta for under the existing debt structure and is not
intended to be indicative of interest expense to be incurred
post-refinancing. |
NEW LA QUINTA ADJUSTED EBITDA NON-GAAP
RECONCILIATIONOUTLOOK: ESTIMATED
2017(unaudited, in millions) |
|
|
|
Year Ending December 31, 2017 |
|
|
Low Case |
|
|
High Case |
Adjusted Net
Income (1) |
|
$ |
38 |
|
|
$ |
41 |
Interest
expense (2) |
|
|
21 |
|
|
|
21 |
Income
tax provision |
|
|
27 |
|
|
|
29 |
Depreciation and amortization |
|
|
5 |
|
|
|
5 |
EBITDA |
|
|
91 |
|
|
|
96 |
Share
based compensation expense |
|
|
10 |
|
|
|
10 |
Amortization of software service agreements |
|
|
9 |
|
|
|
9 |
Adjusted
EBITDA |
|
$ |
110 |
|
|
$ |
115 |
(1) |
This table
provides a reconciliation of estimated Adjusted EBITDA to estimated
Adjusted Net Income from La Quinta’s standalone results, excluding
the results of CorePoint Lodging Inc. and that excludes the impact
of certain items that are not expected to have an ongoing effect on
its operations. Also includes estimated incremental costs of
operating as a stand-alone public company. |
(2) |
Interest
expense represents an allocation of the expected interest expense
for La Quinta for under the existing debt structure and is not
intended to be indicative of interest expense to be incurred
post-refinancing. |
NON-GAAP RECONCILIATIONAs of
December 31, 2016(unaudited, in
millions) |
|
|
|
|
|
Stand-alone FinancialStatement
Basis |
|
|
Reconciling Items |
|
|
|
|
|
|
|
CorePointLodgingInc. (1) |
|
|
New LaQuinta (2) |
|
|
Adjustmentfrom hotelsdisposed orheld forsale
(3) |
|
|
Eliminations /reclassification(4) |
|
|
Estimatedadditionalrecurringcosts
(5) |
|
|
Non-recurringitems (6) |
|
|
LaQuintaHoldingsInc. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room
revenues |
|
$ |
831 |
|
|
$ |
— |
|
|
$ |
32 |
|
|
$ |
(8 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
855 |
|
Franchise
and related services fees |
|
|
— |
|
|
|
104 |
|
|
|
3 |
|
|
|
(1 |
) |
|
|
— |
|
|
|
— |
|
|
|
106 |
|
Other
hotel revenues |
|
|
15 |
|
|
|
— |
|
|
|
1 |
|
|
|
4 |
|
|
|
— |
|
|
|
— |
|
|
|
20 |
|
Management fee |
|
|
— |
|
|
|
42 |
|
|
|
2 |
|
|
|
(44 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
846 |
|
|
|
146 |
|
|
|
38 |
|
|
|
(49 |
) |
|
|
— |
|
|
|
— |
|
|
|
981 |
|
Brand
marketing fund |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25 |
|
|
|
— |
|
|
|
— |
|
|
|
25 |
|
Brand
programs revenues |
|
|
— |
|
|
|
144 |
|
|
|
1 |
|
|
|
(145 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Cost
reimbursements |
|
|
— |
|
|
|
204 |
|
|
|
— |
|
|
|
(204 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total
Revenues |
|
|
846 |
|
|
|
494 |
|
|
|
39 |
|
|
|
(373 |
) |
|
|
— |
|
|
|
— |
|
|
|
1,006 |
|
OPERATING
EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
lodging expenses |
|
|
390 |
|
|
|
— |
|
|
|
20 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
410 |
|
Depreciation and amortization |
|
|
141 |
|
|
|
4 |
|
|
|
2 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
147 |
|
Selling,
general and administrative expenses(7) |
|
|
18 |
|
|
|
52 |
|
|
|
— |
|
|
|
46 |
|
|
|
(12 |
) |
|
|
12 |
|
|
|
116 |
|
Other
lodging and operating expenses |
|
|
57 |
|
|
|
— |
|
|
|
3 |
|
|
|
— |
|
|
|
(1 |
) |
|
|
3 |
|
|
|
62 |
|
Marketing, promotional and other advertising expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
69 |
|
|
|
— |
|
|
|
— |
|
|
|
69 |
|
Brand and
management fees |
|
|
159 |
|
|
|
— |
|
|
|
5 |
|
|
|
(164 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Impairment loss and other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
99 |
|
|
|
99 |
|
|
|
|
765 |
|
|
|
56 |
|
|
|
30 |
|
|
|
(49 |
) |
|
|
(13 |
) |
|
|
114 |
|
|
|
903 |
|
Brand
marketing fund |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
25 |
|
|
|
— |
|
|
|
— |
|
|
|
25 |
|
Brand
programs expenses |
|
|
— |
|
|
|
144 |
|
|
|
1 |
|
|
|
(145 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Cost
reimbursements |
|
|
— |
|
|
|
204 |
|
|
|
— |
|
|
|
(204 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total Operating
Expenses |
|
|
765 |
|
|
|
404 |
|
|
|
31 |
|
|
|
(373 |
) |
|
|
(13 |
) |
|
|
114 |
|
|
|
928 |
|
Operating
Income |
|
|
81 |
|
|
|
90 |
|
|
|
8 |
|
|
|
— |
|
|
|
13 |
|
|
|
(114 |
) |
|
|
78 |
|
Income
(Loss) Before Income Taxes |
|
|
21 |
|
|
|
70 |
|
|
|
8 |
|
|
|
— |
|
|
|
13 |
|
|
|
(113 |
) |
|
|
(1 |
) |
NET INCOME
(LOSS) |
|
$ |
12 |
|
|
$ |
42 |
|
|
$ |
5 |
|
|
$ |
— |
|
|
$ |
8 |
|
|
$ |
(68 |
) |
|
$ |
(1 |
) |
Interest
expense(8) |
|
|
61 |
|
|
|
20 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
81 |
|
Income
taxes |
|
|
9 |
|
|
|
28 |
|
|
|
3 |
|
|
|
— |
|
|
|
5 |
|
|
|
(45 |
) |
|
|
— |
|
Depreciation and amortization |
|
|
143 |
|
|
|
4 |
|
|
|
2 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
149 |
|
EBITDA |
|
|
225 |
|
|
|
94 |
|
|
|
10 |
|
|
|
— |
|
|
|
13 |
|
|
|
(113 |
) |
|
|
229 |
|
Impairment loss and other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
108 |
|
|
|
108 |
|
Equity
based compensation |
|
|
5 |
|
|
|
9 |
|
|
|
— |
|
|
|
— |
|
|
|
(5 |
) |
|
|
5 |
|
|
|
14 |
|
Amortization of software service agreements |
|
|
— |
|
|
|
9 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
9 |
|
Adjusted
EBITDA |
|
$ |
230 |
|
|
$ |
112 |
|
|
$ |
10 |
|
|
$ |
— |
|
|
$ |
8 |
|
|
$ |
— |
|
|
$ |
360 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Represents
CorePoint Lodging’s results on a standalone basis as if the
currently contemplated spin transaction had occurred, and reflects
the results of operations for 316 hotels, which comprises the
“same-store” set and excludes hotels currently classified as assets
held for sale by La Quinta Holdings Inc. These results reflect the
currently contemplated terms of the amended and restated franchise
and management agreements between CorePoint Lodging and new La
Quinta, as well as estimated additional recurring costs of
operating as an independent publicly-traded company. |
(2) |
Represents
La Quinta’s results on a standalone basis as if the currently
contemplated spin transaction had occurred. These results
reflect the currently contemplated terms of the amended and
restated franchise and management agreements between CorePoint
Lodging and new La Quinta, as well as estimated additional
recurring costs of operating as an independent publicly-traded
company. Cost reimbursements reflect payroll and certain
other operating costs incurred by La Quinta in carrying out its
duties as the day-to-day manager of CorePoint Lodging’s hotels
under the management agreement, which costs will be reimbursed to
La Quinta by CorePoint Lodging without markup. |
(3) |
Represents
results of operations recognized by La Quinta Holdings Inc. for
hotels sold or held for sale. |
(4) |
Represents
intercompany eliminations and reclassifications in order to
reconcile the standalone statements of operations for CorePoint
Lodging and new La Quinta to the consolidated statement of
operations reported by La Quinta Holdings Inc. |
(5) |
Represents
estimated additional recurring costs to be incurred as a result of
CorePoint Lodging and new La Quinta operating as independent,
standalone public companies. These estimated additional costs
include, but are not limited to, employing independent executive
management teams and the costs of operating as a public
company. |
(6) |
Represents
items or transactions that were recognized within the results of
operations for La Quinta Holdings Inc. that are not expected to
recur. |
(7) |
Selling,
general and administrative expenses for CorePoint Lodging Inc. are
presented gross, without consideration of amounts that may
ultimately be allocated to property/asset level expenses. |
(8) |
Interest
expense represents an allocation of the interest expense for La
Quinta for under the existing debt structure and is not intended to
be indicative of interest expense to be incurred
post-refinancing. |
NON-GAAP RECONCILIATIONAs of
December 31, 2015(unaudited, in
millions) |
|
|
|
|
|
Stand-alone FinancialStatement
Basis |
|
|
Reconciling Items |
|
|
|
|
|
|
|
CorePointLodgingInc. (1) |
|
|
New LaQuinta (2) |
|
|
Adjustmentfrom hotelsdisposed orheld forsale
(3) |
|
|
Eliminations /reclassification(4) |
|
|
Estimatedadditionalrecurringcosts
(5) |
|
|
Non-recurringitems (6) |
|
|
LaQuintaHoldingsInc. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Room
revenues |
|
$ |
834 |
|
|
$ |
— |
|
|
$ |
61 |
|
|
$ |
(8 |
) |
|
$ |
— |
|
|
$ |
— |
|
|
$ |
887 |
|
Franchise
and related services fees |
|
|
— |
|
|
|
97 |
|
|
|
3 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
100 |
|
Other
hotel revenues |
|
|
16 |
|
|
|
— |
|
|
|
— |
|
|
|
4 |
|
|
|
— |
|
|
|
— |
|
|
|
20 |
|
Management fee |
|
|
— |
|
|
|
43 |
|
|
|
3 |
|
|
|
(46 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
850 |
|
|
|
140 |
|
|
|
67 |
|
|
|
(50 |
) |
|
|
— |
|
|
|
— |
|
|
|
1,007 |
|
Brand
marketing fund |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
23 |
|
|
|
— |
|
|
|
— |
|
|
|
23 |
|
Brand
programs revenues |
|
|
— |
|
|
|
144 |
|
|
|
1 |
|
|
|
(145 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Cost
reimbursements |
|
|
— |
|
|
|
176 |
|
|
|
— |
|
|
|
(176 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total
Revenues |
|
|
850 |
|
|
|
460 |
|
|
|
68 |
|
|
|
(348 |
) |
|
|
— |
|
|
|
— |
|
|
|
1,030 |
|
OPERATING
EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct
lodging expenses |
|
|
366 |
|
|
|
— |
|
|
|
33 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
399 |
|
Depreciation and amortization |
|
|
152 |
|
|
|
4 |
|
|
|
11 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
167 |
|
Selling,
general and administrative expenses(7) |
|
|
18 |
|
|
|
46 |
|
|
|
— |
|
|
|
47 |
|
|
|
(11 |
) |
|
|
26 |
|
|
|
126 |
|
Other
lodging and operating expenses |
|
|
42 |
|
|
|
— |
|
|
|
20 |
|
|
|
— |
|
|
|
(1 |
) |
|
|
2 |
|
|
|
63 |
|
Marketing, promotional and other advertising expenses |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
70 |
|
|
|
— |
|
|
|
— |
|
|
|
70 |
|
Brand and
management fees |
|
|
161 |
|
|
|
— |
|
|
|
6 |
|
|
|
(167 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Impairment loss and other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
54 |
|
|
|
54 |
|
|
|
|
739 |
|
|
|
50 |
|
|
|
70 |
|
|
|
(50 |
) |
|
|
(12 |
) |
|
|
82 |
|
|
|
879 |
|
Brand
marketing fund |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
23 |
|
|
|
— |
|
|
|
— |
|
|
|
23 |
|
Brand
programs expenses |
|
|
— |
|
|
|
144 |
|
|
|
1 |
|
|
|
(145 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Cost
reimbursements |
|
|
— |
|
|
|
176 |
|
|
|
— |
|
|
|
(176 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Total Operating
Expenses |
|
|
739 |
|
|
|
370 |
|
|
|
71 |
|
|
|
(348 |
) |
|
|
(12 |
) |
|
|
82 |
|
|
|
902 |
|
Operating
Income |
|
|
111 |
|
|
|
90 |
|
|
|
(3 |
) |
|
|
— |
|
|
|
12 |
|
|
|
(82 |
) |
|
|
128 |
|
Income
(Loss) Before Income Taxes |
|
|
47 |
|
|
|
68 |
|
|
|
(3 |
) |
|
|
— |
|
|
|
12 |
|
|
|
(75 |
) |
|
|
49 |
|
NET INCOME
(LOSS) |
|
$ |
28 |
|
|
$ |
41 |
|
|
$ |
(2 |
) |
|
$ |
— |
|
|
$ |
7 |
|
|
$ |
(47 |
) |
|
$ |
27 |
|
Interest
expense (8) |
|
|
65 |
|
|
|
22 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
87 |
|
Income
taxes |
|
|
19 |
|
|
|
27 |
|
|
|
(1 |
) |
|
|
— |
|
|
|
5 |
|
|
|
(28 |
) |
|
|
22 |
|
Depreciation and amortization |
|
|
153 |
|
|
|
4 |
|
|
|
11 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
168 |
|
EBITDA |
|
|
265 |
|
|
|
94 |
|
|
|
8 |
|
|
|
— |
|
|
|
12 |
|
|
|
(75 |
) |
|
|
304 |
|
Impairment loss and other |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
63 |
|
|
|
63 |
|
Equity
based compensation |
|
|
4 |
|
|
|
7 |
|
|
|
— |
|
|
|
— |
|
|
|
(4 |
) |
|
|
12 |
|
|
|
19 |
|
Amortization of software service agreements |
|
|
— |
|
|
|
8 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
8 |
|
Adjusted
EBITDA |
|
$ |
269 |
|
|
$ |
109 |
|
|
$ |
8 |
|
|
$ |
— |
|
|
$ |
8 |
|
|
$ |
— |
|
|
$ |
394 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
Represents
CorePoint Lodging’s results on a standalone basis as if the
currently contemplated spin transaction had occurred, and reflects
the results of operations for 316 hotels, which comprises the
“same-store” set and excludes hotels currently classified as assets
held for sale by La Quinta Holdings Inc. These results reflect the
currently contemplated terms of the amended and restated franchise
and management agreements between CorePoint Lodging and new La
Quinta, as well as estimated additional recurring costs of
operating as an independent publicly-traded company. |
(2) |
Represents
La Quinta’s results on a standalone basis as if the currently
contemplated spin transaction had occurred. These results
reflect the currently contemplated terms of the amended and
restated franchise and management agreements between CorePoint
Lodging and new La Quinta, as well as estimated additional
recurring costs of operating as an independent publicly-traded
company. Cost reimbursements reflect payroll and certain
other operating costs incurred by La Quinta in carrying out its
duties as the day-to-day manager of CorePoint Lodging’s hotels
under the management agreement, which costs will be reimbursed to
La Quinta by CorePoint Lodging without markup. |
(3) |
Represents
results of operations recognized by La Quinta Holdings Inc. for
hotels sold or held for sale. |
(4) |
Represents
intercompany eliminations and reclassifications in order to
reconcile the standalone statements of operations for CorePoint
Lodging and new La Quinta to the consolidated statement of
operations reported by La Quinta Holdings Inc. |
(5) |
Represents
estimated additional recurring costs to be incurred as a result of
CorePoint Lodging and new La Quinta operating as independent,
standalone public companies. These estimated additional costs
include, but are not limited to, employing independent executive
management teams and the costs of operating as a public
company. |
(6) |
Represents
items or transactions that were recognized within the results of
operations for La Quinta Holdings Inc. that are not expected to
recur. |
(7) |
Selling,
general and administrative expenses for CorePoint Lodging Inc. are
presented gross, without consideration of amounts that may
ultimately be allocated to property/asset level expenses. |
(8) |
Interest
expense represents an allocation of the interest expense for La
Quinta for under the existing debt structure and is not intended to
be indicative of interest expense to be incurred
post-refinancing. |
Investor Relations:
Kristin Hays
(214) 492-6786
kristin.hays@laquinta.com
Media Relations:
Teresa Ferguson
(214) 492-6937
teresa.ferguson@laquinta.com
Grafico Azioni La Quinta Holdings Inc. (NYSE:LQ)
Storico
Da Mag 2024 a Giu 2024
Grafico Azioni La Quinta Holdings Inc. (NYSE:LQ)
Storico
Da Giu 2023 a Giu 2024