DALLAS--(BUSINESS WIRE)--Aug. 7, 2001--Wyndham International, Inc. (NYSE:WYN - news) today reported results for the second quarter ending June 30, 2001, including the following:
With 22 fewer hotels, EBITDA, as adjusted, was $151.9 million compared to $182.3 million for the same quarter last year.
Cost containment measures resulted in improved margins at quarter end.
RevPAR Penetration Index continues to improve in competitive sets.
Asset sales for the quarter of $164.5 million and $194.8 million year to date.
Wyndham reported earnings before interest, taxes, depreciation and amortization (EBITDA) of $151.9 million, with 22 fewer hotels, compared to $182.3 million for the same quarter last year. The Company reported a net loss of $12.3 million, compared to $46.5 million in the second quarter 2000. After the effect of the preferred dividend, this resulted in a loss of $0.24 per share (diluted), compared with a loss of $0.43 per share (diluted) in the second quarter 2000.
``Given the impact of the economic downturn on the entire lodging industry, we have taken decisive steps in cost containment and revenue generation while not compromising customer service,'' said Fred J. Kleisner, chairman and CEO of Wyndham International. ``The Company's performance in the second quarter is commendable and reflects the quality of Wyndham's management team.''
On a comparable pro forma basis, which reflects adjustments for asset acquisitions and dispositions, EBITDA, as adjusted, was $147.3 million in the second quarter of 2001, down from $162.5 million in the same period a year ago. The corresponding pro forma net loss was $15.5 million, or $0.26 per share (diluted), compared with a pro forma net loss of $54.6 million, or $0.48 per share (diluted), for the same quarter last year.
Cost Containment Initiatives and Margins
Implementation of the previously announced contingency plans for cost reduction in Wyndham's corporate office as well as its hotels were finalized by early July. In June, the effect of these measures resulted in dramatically improved gross operating profit margins versus the first two months of the quarter. The gross operating profit margins for the Wyndham branded owned and leased portfolio increased 150 basis points (bps) in June versus a decrease of 100 bps for the full quarter as compared to the prior year.
The gross operating profit margins for the owned and leased Wyndham International portfolio reflected an increase in the month of June of 150 bps and a decrease for the full quarter of 100 bps as compared to the prior year.
Wyndham expects that the positive margin improvement reported in June will continue for the remainder of the year and that gross operating profit margins for the full year will reflect an increase of 100 bps. The Company is prepared to implement further cost containment programs as economic trends dictate.
RevPAR and Market Penetration
On a comparable owned and leased basis, second quarter revenue per available room (RevPAR) for Wyndham branded hotels decreased 5.4% over a year ago, while the Company's total owned and leased portfolio experienced a 5.3% drop, which is mainly attributable to a 410 basis point decline in occupancy, with average daily rate (ADR) remaining flat to the previous year. On a market-by-market basis, Wyndham branded hotels continue to increase their market share versus its competitive sets, despite the negative RevPAR results. This is attributable to several brand initiatives including Wyndham ByRequest, its guest recognition program.
``We are especially pleased with our progress in gaining RevPAR penetration against our competitors,'' added Kleisner. ``Our management team remains focused on our three-year operating plan.''
Asset Disposition Update
The Company continues to make progress with its three-year plan to focus on proprietary branded operations. For the quarter, the Company sold $164.5 million in non-strategic assets, for a total of $194.8 million year to date. All of the net cash proceeds from these sales were used to reduce debt. The Company remains on track to exceed its goal of $500 million in non-strategic asset sales for 2001.
In addition, consistent with its strategy to grow through the addition of franchise and management contracts, Wyndham has signed two new management contracts and one new franchise agreement as well as four, five-year management extensions year to date. |
