WHITE PLAINS, N.Y., July 26 /PRNewswire/ -- Starwood Hotels & Resorts
Worldwide, Inc. (NYSE: HOT) ("Starwood" or the "Company") today reported
results for the second quarter of 2001.
Second Quarter Financial Highlights
* Total Company EBITDA reached $401 million benefiting from strong cost
containment initiatives.
* Total Company EBITDA margin for the second quarter declined
approximately 50 basis points to 36.1%. Excluding the investment
spending for Six Sigma, total Company EBITDA margins increased
approximately 20 basis points to 36.8%.
* REVPAR for Same-Store Owned Hotels in Europe increased 7.6% excluding
the unfavorable effect of foreign currency translation. Further,
excluding United Kingdom hotels where reports of foot-and-mouth disease
have negatively impacted travel, REVPAR increased 10.4% and EBITDA at
Comparable Owned Hotels increased 17.3%.
* Starwood branded hotel marketshare in North America increased 190 basis
points versus the competitive set through May 2001.
* REVPAR for Worldwide Same-Store Owned Westin Hotels decreased 1.3% as
ADR increased 1.2% while occupancy declined 190 basis points to 75.1%.
* REVPAR for Worldwide Same-Store Owned St. Regis/Luxury Collection
Hotels, excluding the unfavorable effect of foreign currency
translation and the New York St. Regis, increased 8.2% as ADR increased
11.4%.
Second Quarter Ended June 30, 2001
EPS was $0.55 in the second quarter of 2001 compared to EPS of $0.56 in
the corresponding period in 2000. Total revenues were down 2.8% to
$1.110 billion compared to the same period in 2000, despite the negative
impact of the slowing North American economy, the disposition of several
hotels, the effective closure of two hotels in Chicago for renovation and
repositioning to W hotels, the political and economic crisis in Latin America,
the closure of one hotel in Fiji and the unfavorable impact of foreign
currency translation. The Company expects that both of the Chicago hotels
will contribute to stronger revenue growth in the second half of 2001.
Operating income for the second quarter of 2001 was $254 million compared to
$285 million in the same period of 2000 due in part to increased non-cash
charges for depreciation. Income from continuing operations was $113 million
in the second quarter of 2001 compared to $114 million in the same period of
2000 benefiting from reduced interest expense, resulting from a reduction in
interest rates and the completion of certain financing transactions and a
reduction in the Company's effective tax rate.
The results for the quarter include approximately $7.5 million of
implementation costs associated with the Company's Six Sigma initiative offset
by a pre-tax gain of approximately $7.9 million, resulting from cost
containment efforts which led to the termination of a pension plan. Six Sigma
financial benefits are expected to be a net positive by early fourth quarter
2001.
Six Months Ended June 30, 2001
For the six months ended June 30, 2001, total revenues were $2.124 billion
compared to $2.138 billion in the same period in 2000 and EPS was $0.85
compared to EPS of $0.82 in the corresponding period in 2000. Income from
continuing operations increased to $175 million in the six months ended June
30, 2001 compared to $167 million in the same period of 2000.
Comments from the CEO
"The speed and depth of the slowdown of the world's economies has been
faster and deeper than we, like most others, had expected," said Barry S.
Sternlicht, Chairman and CEO. "Still, in these extremely difficult business
conditions, we are generally pleased with our second quarter performance.
Despite the severe economic slowdown in North America, continued weakness in
the Euro, economic and currency weakness in Latin America, unrest in the
Middle East and other macro issues, we remain a very profitable company
generating very strong cash flows that nearly matched those posted in last
year's robust environment. While we have slowed certain capital expenditures,
particularly in the interval ownership area, and carefully managed
controllable costs, we have consciously continued our sizable investment
spending in Six Sigma training, the completion of three new W Hotels and the
rollout of our new yield management system -- all of which are designed to
help ensure that we continue the growth trends we posted in 1999 and 2000 as
soon as economic conditions permit. We have just begun to realize the
potential for even better control of costs and, more importantly,
significantly increased revenue-generating opportunities through our roll-out
of Six Sigma."
"Recognizing the relative valuation of our company, we are also carefully
examining all structural alternatives that could enhance shareholder value.
Included in this strategic review is the consummation of the sale of all or
substantially all of the CIGA portfolio as well as accelerating the strategic
review of our ownership of assets around the world."
"We are encouraged that the major weaknesses in our domestic portfolio
today are in New York and San Francisco, two cities that are terrific
long-term real estate investment markets, and that overall new hotel supply
growth continues to decelerate as already difficult financing markets tighten
further."
Concluding, Mr. Sternlicht said, "While we are cautiously optimistic that
the economy and our sector could rebound in the fourth quarter, we are not
running our business that way. With the recovery, our investments behind
Starwood Preferred Guest, W Hotels, Westin's "Heavenly" branded products,
renovations and repositionings, yield management, expansion of our interval
ownership business and Six Sigma have positioned Starwood to lead the sector
in earnings and cash flow growth."
Operating Results
At the Company's Comparable Owned Hotels, revenues for the second quarter
of 2001 decreased to $895 million from $957 million in 2000 and EBITDA
decreased to $309 million from $341 million in 2000. Operating results at
Comparable Owned Hotels in North America declined in the second quarter of
2001 when compared to 2000, reflecting the impact of lower REVPAR primarily
attributable to lower business transient demand. EBITDA at the Company's
Comparable Owned Hotels in Europe increased 6.3% to $62 million in the second
quarter of 2001 when compared to the same period in 2000 (a 14.0% increase
excluding the unfavorable effects of foreign exchange).
For the second quarter of 2001, revenue per available room ("REVPAR") at
Same-Store Owned Hotels decreased 6.8% when compared to the same period in
2000 as a result of a decline in occupancy rates of 500 basis points to 69.9%,
while average daily rate ("ADR") remained in-line with the prior year. REVPAR
at Same-Store Owned Hotels in North America decreased 7.4% to $110.24 when
compared to the same period in 2000 as a result of a decrease in occupancy
rates of 570 basis points to 70.6%, while ADR increased slightly to $156.24.
The Company's results in North America were negatively impacted by the
significant drop in industry-wide lodging demand, particularly in New York,
where the Company has seven owned hotels with approximately 3,900 rooms.
Excluding owned hotels in New York and two hotels under significant renovation
in Chicago, REVPAR at Same-Store Owned Hotels in North America decreased 4.2%
in the second quarter of 2001 when compared to the same period in 2000.
REVPAR at Westin Same-Store Owned Hotels in North America decreased 1.6% as a
result of a decrease in occupancy rates of 230 basis points and an increase in
ADR of 1.5%. In Europe, Same-Store Owned Hotel REVPAR increased 7.6%,
excluding the unfavorable effect of foreign currency translation, primarily as
a result of strong gains at owned hotels in Spain and Italy. Results in
Europe were negatively impacted by the unfavorable effect of foreign currency
translation as well as the drop in demand in the United Kingdom due primarily
to concerns related to reports of foot-and-mouth disease. Excluding the
unfavorable effect of foreign currency translation and excluding owned hotels
in the United Kingdom, REVPAR at Same-Store Owned Hotels in Europe increased
10.4%. (See attached tables for detailed REVPAR analysis.)
EBITDA margins at Comparable Owned Hotels worldwide decreased 100 basis
points to 34.6% in the second quarter of 2001 when compared to the same period
in 2000. In North America, EBITDA margins at Comparable Owned Hotels
decreased 170 basis points to 33.4% in the second quarter of 2001 when
compared to the same period in 2000. Excluding the effectively closed hotels
in Chicago, North America EBITDA margins decreased 120 basis points period to
period. Internationally, despite weak economic, political and/or currency
conditions, EBITDA margins at Comparable Owned Hotels increased 70 basis
points to 37.9% in the second quarter of 2001 when compared to the same period
in 2000 (EBITDA margins at Comparable Owned Hotels in Europe increased 170
basis points to 38.0% in the second quarter of 2001 when compared to the same
period in 2000). Excluding the unfavorable effect of foreign currency
translation and U.K. hotels, EBITDA margins at Comparable Owned Hotels in
Europe increased 230 basis points.
During the second quarter of 2001, the Company added 14 management and
franchise contracts with approximately 4,000 rooms, including the 1,060 room
Westin Diplomat in Hollywood Florida which is scheduled to open January 2002.
During the first half of 2001 the Company added 30 management and franchise
contracts with approximately 6,800 rooms.
The Company is currently selling vacation ownership interest ("VOI")
inventory at nine resorts and engaged in pre-opening sales at two others.
Three new build projects are currently underway including Sheraton's Mountain
Vista in Avon, Colorado; Westin Mission Hills Resort Villas in Rancho Mirage,
California (both in pre-opening sales); and Westin Ka'anapali Ocean Resort
Villas in Maui, Hawaii. All three new build projects are expected to post
meaningful revenue and EBITDA beginning in the latter part of 2001 and into
2002.
Acquisitions and Dispositions
In April 2001, the Company completed the acquisition of the remaining 50%
interest in the 1,377-room Sheraton Centre Toronto for approximately CDN
$75 million (approximately USD $48 million or the equivalent of approximately
$70,000 per key). Starwood owned 50% of this property before completion of
this acquisition. The purchase price represented a trailing twelve-month
EBITDA of less than five times. The Company also acquired a 44% interest in
the Sheraton Royal Orchid Hotel in Thailand for approximately $27 million or
the equivalent of approximately $80,000 per key.
The Company is continuing to pursue the sale of its CIGA portfolio which
includes such world renowned assets as the Hotel Gritti Palace and Hotel
Danieli in Venice, the St. Regis Grand and Westin Excelsior in Rome, the Grand
Hotel and Westin Excelsior in Florence, the Principe di Savoia in Milan and
Westin Palace in Madrid, among others. The Company has spent considerable
time determining the optimal strategy for maximizing sale proceeds of this
extraordinary portfolio and, early in the second quarter, retained investment
bank support to market for sale all or a portion of the portfolio. The
Company expects to receive some or all of the proceeds from the sale of
certain CIGA assets within the next nine months. The Company plans to retain
long-term management contracts to keep these important destinations accessible
to its customer base. The Company continues to review its portfolio for
disposition candidates.
Capital
Early in the year the Company moved aggressively to reduce its
discretionary capital expenditures. During the second quarter of 2001, the
Company invested approximately $122 million for capital, primarily at owned
hotel assets and VOI construction. Most of this investment spend included the
ongoing repositioning of the Midland Hotel to the W Chicago-City Center (390
rooms), which is now open, conversion of the Days Inn Chicago to the W
Chicago-Lakeshore (556 rooms, opening early fall), development of the W New
York-Times Square (511 rooms, opening early fourth quarter) as well as the
development of The St. Regis Museum Tower in San Francisco (269 rooms and 102
condominiums).
Financing
On June 30, 2001, the Company had total debt of $5.529 billion and cash
and cash equivalents of $221 million. In May 2001, the Company completed a
$100 million add-on financing to its credit facility. Also in May 2001, the
Company sold two separate series of zero-coupon convertible senior notes due
2021 for gross proceeds of approximately $500 million. The proceeds were used
to repay a portion of its increasing rate notes ("IRNs") that currently bear
interest at LIBOR plus 275 basis points. As a result of the paydown of a
portion of the IRNs, the Company recorded an extraordinary loss of $6 million
(net of tax) on the early extinguishment of this debt.
At the end of the second quarter of 2001, the Company's debt was
approximately 67% fixed rate and 33% floating rate and its weighted average
maturity was just under five years. The Company elected to retain its
floating rate debt position as a natural hedge against the anticipated
economic softness in North America. As of June 30, 2001, the Company had
availability under its revolving credit facility of approximately $537 million
and the Company's debt had a weighted average interest rate of 6.12%.
During the second quarter, the Company repurchased 200,000 shares at a
total cost of approximately $6.6 million. At June 30, 2001, Starwood had
approximately 203 million shares outstanding (including partnership units and
exchangeable preferred shares).
In May 2001, Starwood Hotels & Resorts (the "Trust") declared a second
quarter dividend of $0.20 per share ($0.80 annual rate), representing a 16%
increase over the prior year quarterly dividend.
Future Performance
All comments in the following paragraphs and the comments in this release
above are deemed to be forward-looking statements. These statements reflect
expectations of the Company's performance given its current base of assets and
its current understanding of external economic and political environments.
Actual results may differ materially.
* The Company will continue to aggressively manage costs. Due to the
continued weakness of the U.S. economy, full year 2001 North America
Same-Store REVPAR is now expected to decline 2% to 3%. Full year
Worldwide Same-Store REVPAR is now also expected to decline 2% to 3%.
* Full year 2001 EBITDA is expected to be approximately $1.550 billion
and EPS is expected to be approximately $1.96 or in line with 2000's
record results.
* Given the continued weak economic environment and unfavorable foreign
currency fluctuations, the Company believes there is a greater chance
of reporting EPS lower than $1.96 than there is of exceeding it.
Starwood Hotels & Resorts Worldwide, Inc. will be conducting a conference
call to discuss the second quarter financial results at 10:30 a.m. (EDT)
today. The conference call will be available through simultaneous webcast in
the Investor Relations/Press Releases section of the Company's website at
http://www.starwoodhotels.com. A replay of the conference call will also be
available from 1:30 p.m. (EDT) today through 8:00 p.m. (EDT) August 2, 2001 on
both the Company's website and via telephone replay at 719-457-0820 (access
code: 629180).
All references to EPS reflect earnings per diluted share from continuing
operations. All references to Comparable Owned Hotels reflect the Company's
owned, leased and consolidated joint venture hotels, excluding hotels sold
during 2000 and 2001 and hotels without comparable prior year results. All
references to EBITDA at Comparable Owned Hotels further exclude implementation
costs associated with Six Sigma. All references to Same-Store Owned Hotels
reflect the Company's owned, leased and consolidated joint venture hotels,
excluding hotels under significant renovation or for which comparable results
are not available.
Starwood Hotels & Resorts Worldwide, Inc. is one of the leading hotel and
leisure companies in the world with more than 725 properties in 80 countries
and 120,000 employees at its owned and managed properties. With
internationally renowned brands, Starwood is a fully integrated owner,
operator and franchiser of hotels and resorts including: St. Regis, The
Luxury Collection, Sheraton, Westin, Four Points by Sheraton and W brands, as
well as Starwood Vacation Ownership, Inc., one of the premier developers and
operators of high quality vacation interval ownership.
(Note: This release contains certain statements that may be deemed
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934.
Forward-looking statements are not guarantees of future performance and
involve risks and uncertainties that could cause actual results to differ
materially from historical results or those anticipated at the time the
forward-looking statements are made, including, without limitation, risks and
uncertainties associated with the following: the continued ability of the
Trust to qualify for taxation as a REIT; Starwood's ability to attract and
retain personnel; identification, completion, terms and timing of future
acquisitions and dispositions; the availability and terms of capital for
acquisitions and for renovations; execution of hotel renovation and expansion
programs; the ability to maintain existing management, franchise or
representation agreements and to obtain new agreements on favorable terms;
competition within the lodging and leisure industry; the cyclicality of the
real estate business and the hotel and leisure business; foreign exchange
fluctuations and exchange control restrictions; general real estate and
national and international economic conditions; political and financial
conditions and uncertainties in countries in which Starwood owns or operates
properties; changes in current laws, rules or regulations of governmental or
other regulatory bodies; and the other risks and uncertainties set forth in
the annual, quarterly and current reports and proxy statements of the Trust
and Starwood filed with the Securities and Exchange Commission. Starwood
undertakes no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise.)
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per Share data)
Three Months Ended Six Months Ended
June 30, June 30,
2001 2000 2001 2000
Revenues
Owned, leased and
consolidated
$930 $971 joint venture hotels $1,795 $1,814
180 171 Other hotel and leisure(a) 329 324
1,110 1,142 2,124 2,138
Costs and Expenses
Owned, leased and
consolidated joint
618 628 venture hotels 1,214 1,218
Selling, general,
administrative and
108 111 other(b) 207 215
Restructuring and other
-- -- special credits (1) --
107 95 Depreciation 212 192
23 23 Amortization 45 43
856 857 1,677 1,668
254 285 Operating income 44 470
Interest expense, net of
(92) (108) interest income (192) (213)
Gain on sales of real estate
1 1 and investments, net 1 2
163 178 256 259
(48) (62) Income tax expense (79) (91)
(2) (2) Minority equity in net income (2) (1)
Income from continuing
113 114 operations 175 167
Discontinued operations:
Gain on dispositions,
-- 5 net of tax -- 5
(6) -- Extraordinary item, net of tax (6) (3)
$107 $119 Net income $169 $169
Earnings Per Share - Basic
$0.57 $0.58 Continuing operations $0.88 $0.85
-- 0.02 Discontinued operations -- 0.02
(0.03) -- Extraordinary item (0.03) (0.01)
$0.54 $0.60 Net income $0.85 $0.86
Earnings Per Share - Diluted
$0.55 $0.56 Continuing operations $0.85 $0.82
-- 0.02 Discontinued operations -- 0.02
(0.03) -- Extraordinary item (0.03) (0.01)
$0.52 $0.58 Net income $0.82 $0.83
Weighted average number
199 195 of Shares 199 195
Weighted average number of
207 205 Shares assuming dilution 207 204
Reconciliation of Operating Income to EBITDA(c)
$254 $285 Operating income $447 $470
113 100 Depreciation(d) 225 203
23 23 Amortization 45 43
Interest expense of
7 4 unconsolidated joint ventures 13 10
4 6 Interest income 7 9
Restructuring and other
-- -- special credits (1) --
$401 $418 EBITDA $736 $735
(a) Other hotel and leisure revenues include management and franchise
fees earned from third party hotel owners, the Company's interest in
unconsolidated joint ventures and the sale and financing of VOIs.
(b) Selling, general, administrative and other expenses includes the
cost of sales of VOIs and other costs of timeshare operations.
(c) EBITDA is defined as income before interest expense, income tax
expense and depreciation and amortization. Non-recurring items and
gains and losses from sales of real estate and investments are also
excluded from EBITDA as these items do not impact operating results
on a recurring basis. Management considers EBITDA to be one measure
of the cash flows from operations of the Company before debt service
that provides a relevant basis for comparison, and EBITDA is
presented to assist investors in analyzing the performance of the
Company. This information should not be considered as an alternative
to any measure of performance as promulgated under accounting
principles generally accepted in the United States, nor should it be
considered as an indicator of the overall financial performance of
the Company. The Company's calculation of EBITDA may be different
from the calculation used by other companies and, therefore,
comparability may be limited.
(d) Includes depreciation expense of unconsolidated joint ventures.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
UNAUDITED CONSOLIDATED BALANCE SHEET INFORMATION
(In millions)
June 30,
2001
Total assets $12,713
Cash and cash equivalents $221
Total debt $5,529
Shares outstanding(a) 203
(a) Shares outstanding include partnership units and exchangeable
preferred shares.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Same Store (1)
For the Three Months Ending June 30, 2001
WORLDWIDE NORTH AMERICA
2001 2000 Var. 2001 2000 Var.
OWNED HOTELS 156 Hotels 111 Hotels
REVPAR ($) 113.31 121.52 -6.8% 110.24 119.06 -7.4%
ADR ($) 162.21 162.16 0.0% 156.24 156.13 0.1%
OCCUPANCY (%) 69.9% 74.9% -5.0 70.6% 76.3% -5.7
SHERATON 67 43
REVPAR ($) 95.16 106.04 -10.3% 100.49 110.83 -9.3%
ADR ($) 140.15 143.22 -2.1% 143.51 144.29 -0.5%
OCCUPANCY (%) 67.9% 74.0% -6.1 70.0% 76.8% -6.8
WESTIN 35 23
REVPAR ($) 123.56 125.20 -1.3% 110.66 112.44 -1.6%
ADR ($) 164.63 162.68 1.2% 148.56 146.40 1.5%
OCCUPANCY (%) 75.1% 77.0% -1.9 74.5% 76.8% -2.3
LUXURY COLLECTION 14 5
REVPAR ($) 244.40 247.98 -1.4% 245.80 265.65 -7.5%
ADR ($) 344.71 334.52 3.0% 352.54 346.51 1.7%
OCCUPANCY (%) 70.9% 74.1% -3.2 69.7% 76.7% -7.0
W 9 9
REVPAR ($) 156.68 174.66 -10.3% 156.68 174.66 -10.3%
ADR ($) 220.52 227.47 -3.1% 220.52 227.47 -3.1%
OCCUPANCY (%) 71.1% 76.8% -5.7 71.1% 76.8% -5.7
OTHER 31 31
REVPAR ($) 83.98 93.47 -10.2% 83.98 93.47 -10.2%
ADR ($) 127.16 126.48 0.5% 127.16 126.48 0.5%
OCCUPANCY (%) 66.0% 73.9% -7.9 66.0% 73.9% -7.9
INTERNATIONAL(2)
2001 2000 Var.
OWNED HOTELS 45 Hotels
REVPAR ($) 123.05 129.32 -4.8%
ADR ($) 181.95 182.81 -0.5%
OCCUPANCY (%) 67.6% 70.7% -3.1
SHERATON 24
REVPAR ($) 84.04 96.12 -12.6%
ADR ($) 132.45 140.72 -5.9%
OCCUPANCY (%) 63.5% 68.3% -4.8
WESTIN 12
REVPAR ($) 171.93 174.21 -1.3%
ADR ($) 222.83 224.57 -0.8%
OCCUPANCY (%) 77.2% 77.6% -0.4
LUXURY COLLECTION 9
REVPAR ($) 242.86 228.47 6.3%
ADR ($) 336.43 320.30 5.0%
OCCUPANCY (%) 72.2% 71.3% 0.9
(1) Hotel Results exclude 3 hotels under significant renovation or without
comparable results, 5 hotels without prior year results and 7 hotels
sold during 2000 and 2001.
(2) See next page for breakdown by division.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Same Store (1)
For the Three Months Ending June 30, 2001
EUROPE LATIN AMERICA
2001 2000 Var. 2001 2000 Var.
OWNED HOTELS 30 Hotels 13 Hotels
REVPAR ($) 165.14 164.60 0.3% 74.07 88.46 -16.3%
ADR ($) 222.44 217.01 2.5% 125.38 138.32 -9.4%
OCCUPANCY (%) 74.2% 75.8% -1.6 59.1% 64.0% -4.9
SHERATON 12 10
REVPAR ($) 107.99 110.71 -2.5% 68.38 85.89 -20.4%
ADR ($) 146.92 147.97 -0.7% 123.53 136.92 -9.8%
OCCUPANCY (%) 73.5% 74.8% -1.3 55.4% 62.7% -7.3
WESTIN 9 3
REVPAR ($) 199.14 206.67 -3.6% 102.78 100.72 2.0%
ADR ($) 259.00 255.10 1.5% 132.04 144.33 -8.5%
OCCUPANCY (%) 76.9% 81.0% -4.1 77.8% 69.8% 8.0
LUXURY COLLECTION 9
REVPAR ($) 242.86 228.47 6.3%
ADR ($) 336.43 320.30 5.0%
OCCUPANCY (%) 72.2% 71.3% 0.9
ASIA PACIFIC
2001 2000 Var.
OWNED HOTELS 2 Hotels
REVPAR ($) 67.33 89.15 -24.5%
ADR ($) 105.30 127.20 -17.2%
OCCUPANCY (%) 63.9% 70.1% -6.2
SHERATON 2
REVPAR ($) 67.33 89.15 -24.5%
ADR ($) 105.30 127.20 -17.2%
OCCUPANCY (%) 63.9% 70.1% -6.2
(1) Hotel Results exclude 3 hotels under significant renovation or without
comparable results, 5 hotels without prior year results and 7 hotels
sold during 2000 and 2001.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Comparable (1)
For the Three Months Ending June 30, 2001
UNAUDITED ($ thousands)
WORLDWIDE NORTH AMERICA
2001 2000 Var. 2001 2000 Var.
OWNED HOTELS 159 Hotels 112 Hotels
TOTAL REVENUE 894,651 957,401 -6.6% 661,725 714,218 -7.3%
TOTAL EBITDA 309,390 341,056 -9.3% 221,177 250,566 -11.7%
MARGIN % 34.6% 35.6% -1.0 33.4% 35.1% -1.7
SHERATON 69 43
REVENUE 355,561 390,953 -9.1% 246,396 267,644 -7.9%
EBITDA 122,098 142,563 -14.4% 85,713 99,201 -13.6%
MARGIN % 34.3% 36.5% -2.2 34.8% 37.1% -2.3
WESTIN 35 23
REVENUE 256,245 260,500 -1.6% 181,654 187,697 -3.2%
EBITDA 91,143 90,917 0.2% 59,799 61,965 -3.5%
MARGIN % 35.6% 34.9% 0.7 32.9% 33.0% -0.1
LUXURY COLLECTION 14 5
REVENUE 128,399 133,136 -3.6% 79,229 86,065 -7.9%
EBITDA 45,640 47,018 -2.9% 25,156 28,842 -12.8%
MARGIN % 35.5% 35.3% 0.2 31.8% 33.5% -1.7
W 9 9
REVENUE 63,256 68,195 -7.2% 63,256 68,195 -7.2%
EBITDA 21,916 23,326 -6.0% 21,916 23,326 -6.0%
MARGIN % 34.6% 34.2% 0.4 34.6% 34.2% 0.4
OTHER 32 32
REVENUE 91,190 104,617 -12.8% 91,190 104,617 -12.8%
EBITDA 28,593 37,232 -23.2% 28,593 37,232 -23.2%
MARGIN % 31.4% 35.6% -4.2 31.4% 35.6% -4.2
INTERNATIONAL(2)
2001 2000 Var.
OWNED HOTELS 47 Hotels
TOTAL REVENUE 232,926 243,183 -4.2%
TOTAL EBITDA 88,213 90,490 -2.5%
MARGIN % 37.9% 37.2% 0.7
SHERATON 26
REVENUE 109,165 123,309 -11.5%
EBITDA 36,385 43,362 -16.1%
MARGIN % 33.3% 35.2% -1.9
WESTIN 12
REVENUE 74,591 72,803 2.5%
EBITDA 31,344 28,952 8.3%
MARGIN % 42.0% 39.8% 2.2
LUXURY COLLECTION 9
REVENUE 49,170 47,071 4.5%
EBITDA 20,484 18,176 12.7%
MARGIN % 41.7% 38.6% 3.1
(1) Hotel Results exclude 5 hotels without prior year results, 7 hotels
sold during 2000 and 2001 and Six Sigma implementation costs of
$4,807 in 2001.
(2) See next page for breakdown by division.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Comparable (1)
For the Three Months Ending June 30, 2001
UNAUDITED ($ thousands)
EUROPE LATIN AMERICA
2001 2000 Var. 2001 2000 Var.
OWNED HOTELS 30 Hotels 14 Hotels
TOTAL REVENUE 163,053 160,382 1.7% 59,853 67,995 -12.0%
TOTAL EBITDA 61,947 58,295 6.3% 24,126 28,112 -14.2%
MARGIN % 38.0% 36.3% 1.7 40.3% 41.3% -1.0
SHERATON 12 11
REVENUE 54,597 55,467 -1.6% 44,548 53,036 -16.0%
EBITDA 16,576 16,837 -1.6% 17,669 22,442 -21.3%
MARGIN % 30.4% 30.4% 0.0 39.7% 42.3% -2.6
WESTIN 9 3
REVENUE 59,286 57,844 2.5% 15,305 14,959 2.3%
EBITDA 24,887 23,282 6.9% 6,457 5,670 13.9%
MARGIN % 42.0% 40.2% 1.8 42.2% 37.9% 4.3
LUXURY COLLECTION 9
REVENUE 49,170 47,071 4.5%
EBITDA 20,484 18,176 12.7%
MARGIN % 41.7% 38.6% 3.1
ASIA PACIFIC
2001 2000 Var.
OWNED HOTELS 3 Hotels
TOTAL REVENUE 10,020 14,806 -32.3%
TOTAL EBITDA 2,140 4,083 -47.6%
MARGIN % 21.4% 27.6% -6.2
SHERATON 3
REVENUE 10,020 14,806 -32.3%
EBITDA 2,140 4,083 -47.6%
MARGIN % 21.4% 27.6% -6.2
(1) Hotel Results exclude 5 hotels without prior year results, 7 hotels
sold during 2000 and 2001 and Six Sigma implementation costs of
$4,807 in 2001.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Same Store (1)
For the Six Months Ending June 30, 2001
WORLDWIDE
2001 2000 Var.
OWNED HOTELS 155 Hotels
REVPAR ($) 111.91 114.40 -2.2%
ADR ($) 164.08 160.87 2.0%
OCCUPANCY (%) 68.2% 71.1% -2.9
SHERATON 66
REVPAR ($) 94.28 99.58 -5.3%
ADR ($) 142.56 143.65 -0.8%
OCCUPANCY (%) 66.1% 69.3% -3.2
WESTIN 35
REVPAR ($) 122.72 119.90 2.4%
ADR ($) 165.33 160.74 2.9%
OCCUPANCY (%) 74.2% 74.6% -0.4
LUXURY COLLECTION 14
REVPAR ($) 245.86 242.85 1.2%
ADR ($) 346.55 334.68 3.5%
OCCUPANCY (%) 70.9% 72.6% -1.7
W 9
REVPAR ($) 158.63 162.85 -2.6%
ADR ($) 226.27 218.64 3.5%
OCCUPANCY (%) 70.1% 74.5% -4.4
OTHER 31
REVPAR ($) 78.45 83.03 -5.5%
ADR ($) 126.05 120.57 4.5%
OCCUPANCY (%) 62.2% 68.9% -6.7
NORTH AMERICA
2001 2000 Var.
OWNED HOTELS 110 Hotels
REVPAR ($) 110.98 113.13 -1.9%
ADR ($) 161.29 156.89 2.8%
OCCUPANCY (%) 68.8% 72.1% -3.3
SHERATON 42
REVPAR ($) 98.38 102.37 -3.9%
ADR ($) 146.17 144.71 1.0%
OCCUPANCY (%) 67.3% 70.7% -3.4
WESTIN 23
REVPAR ($) 114.51 110.88 3.3%
ADR ($) 153.23 147.79 3.7%
OCCUPANCY (%) 74.7% 75.0% -0.3
LUXURY COLLECTION 5
REVPAR ($) 279.86 285.99 -2.1%
ADR ($) 385.25 370.36 4.0%
OCCUPANCY (%) 72.6% 77.2% -4.6
W 9
REVPAR ($) 158.63 162.85 -2.6%
ADR ($) 226.27 218.64 3.5%
OCCUPANCY (%) 70.1% 74.5% -4.4
OTHER 31
REVPAR ($) 78.45 83.03 -5.5%
ADR ($) 126.05 120.57 4.5%
OCCUPANCY (%) 62.2% 68.9% -6.7
INTERNATIONAL (2)
2001 2000 Var.
OWNED HOTELS 45 Hotels
REVPAR ($) 114.89 118.50 -3.0%
ADR ($) 173.43 174.48 -0.6%
OCCUPANCY (%) 66.2% 67.9% -1.7
SHERATON 24
REVPAR ($) 85.81 93.85 -8.6%
ADR ($) 134.70 141.34 -4.7%
OCCUPANCY (%) 63.7% 66.4% -2.7
WESTIN 12
REVPAR ($) 154.32 155.57 -0.8%
ADR ($) 213.51 213.39 0.1%
OCCUPANCY (%) 72.3% 72.9% -0.6
LUXURY COLLECTION 9
REVPAR ($) 205.61 191.20 7.5%
ADR ($) 298.27 285.43 4.5%
OCCUPANCY (%) 68.9% 67.0% 1.9
(1) Hotel Results exclude 3 hotels under significant renovation or
without comparable results, 6 hotels without prior year results and 9
hotels sold during 2000 and 2001.
(2) See next page for breakdown by division.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Same Store (1)
For the Six Months Ending June 30, 2001
EUROPE
2001 2000 Var.
OWNED HOTELS 30 Hotels
REVPAR ($) 142.25 138.98 2.4%
ADR ($) 206.43 200.56 2.9%
OCCUPANCY (%) 68.9% 69.3% -0.4
SHERATON 12
REVPAR ($) 100.12 99.58 0.5%
ADR ($) 145.49 144.57 0.6%
OCCUPANCY (%) 68.8% 68.9% -0.1
WESTIN 9
REVPAR ($) 165.55 168.04 -1.5%
ADR ($) 239.82 234.43 2.3%
OCCUPANCY (%) 69.0% 71.7% -2.7
LUXURY COLLECTION 9
REVPAR ($) 205.61 191.20 7.5%
ADR ($) 298.27 285.43 4.5%
OCCUPANCY (%) 68.9% 67.0% 1.9
LATIN AMERICA
2001 2000 Var.
OWNED HOTELS 13 Hotels
REVPAR ($) 85.27 95.66 -10.9%
ADR ($) 136.99 146.65 -6.6%
OCCUPANCY (%) 62.2% 65.2% -3.0
SHERATON 10
REVPAR ($) 76.97 88.77 -13.3%
ADR ($) 131.16 140.77 -6.8%
OCCUPANCY (%) 58.7% 63.1% -4.4
WESTIN 3
REVPAR ($) 126.99 128.48 -1.2%
ADR ($) 158.41 170.04 -6.8%
OCCUPANCY (%) 80.2% 75.6% 4.6
ASIA PACIFIC
2001 2000 Var.
OWNED HOTELS 2 Hotels
REVPAR ($) 74.67 96.82 -22.9%
ADR ($) 108.32 132.22 -18.1%
OCCUPANCY (%) 68.9% 73.2% -4.3
SHERATON 2
REVPAR ($) 74.67 96.82 -22.9%
ADR ($) 108.32 132.22 -18.1%
OCCUPANCY (%) 68.9% 73.2% -4.3
(1) Hotel Results exclude 3 hotels under significant renovation or
without comparable results, 6 hotels without prior year results and 9
hotels sold during 2000 and 2001.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Comparable (1)
For the Six Months Ending June 30, 2001
UNAUDITED ($ thousands)
WORLDWIDE
2001 2000 Var.
OWNED HOTELS 158 Hotels
TOTAL REVENUE 1,740,445 1,789,979 -2.8%
TOTAL EBITDA 581,702 593,166 -1.9%
MARGIN % 33.4% 33.1% 0.3
SHERATON 68
REVENUE 682,324 720,187 -5.3%
EBITDA 222,938 237,946 -6.3%
MARGIN % 32.7% 33.0% -0.3
WESTIN 35
REVENUE 510,083 500,972 1.8%
EBITDA 177,610 167,676 5.9%
MARGIN % 34.8% 33.5% 1.3
LUXURY COLLECTION 14
REVENUE 252,667 252,997 -0.1%
EBITDA 90,072 86,435 4.2%
MARGIN % 35.6% 34.2% 1.4
W 9
REVENUE 126,422 129,361 -2.3%
EBITDA 43,806 42,751 2.5%
MARGIN % 34.7% 33.0% 1.7
OTHER 32
REVENUE 168,949 186,462 -9.4%
EBITDA 47,276 58,358 -19.0%
MARGIN % 28.0% 31.3% -3.3
NORTH AMERICA
2001 2000 Var.
OWNED HOTELS 111 Hotels
TOTAL REVENUE 1,318,297 1,352,608 -2.5%
TOTAL EBITDA 436,333 447,001 -2.4%
MARGIN % 33.1% 33.0% 0.1
SHERATON 42
REVENUE 469,097 484,477 -3.2%
EBITDA 153,248 160,209 -4.3%
MARGIN % 32.7% 33.1% -0.4
WESTIN 23
REVENUE 378,922 372,142 1.8%
EBITDA 128,285 121,253 5.8%
MARGIN % 33.9% 32.6% 1.3
LUXURY COLLECTION 5
REVENUE 174,907 180,166 -2.9%
EBITDA 63,718 64,430 -1.1%
MARGIN % 36.4% 35.8% 0.6
W 9
REVENUE 126,422 129,361 -2.3%
EBITDA 43,806 42,751 2.5%
MARGIN % 34.7% 33.0% 1.7
OTHER 32
REVENUE 168,949 186,462 -9.4%
EBITDA 47,276 58,358 -19.0%
MARGIN % 28.0% 31.3% -3.3
INTERNATIONAL (2)
2001 2000 Var.
OWNED HOTELS 47 Hotels
TOTAL REVENUE 422,148 437,371 -3.5%
TOTAL EBITDA 145,369 146,165 -0.5%
MARGIN % 34.4% 33.4% 1.0
SHERATON 26
REVENUE 213,227 235,710 -9.5%
EBITDA 69,690 77,737 -10.4%
MARGIN % 32.7% 33.0% -0.3
WESTIN 12
REVENUE 131,161 128,830 1.8%
EBITDA 49,325 46,423 6.3%
MARGIN % 37.6% 36.0% 1.6
LUXURY COLLECTION 9
REVENUE 77,760 72,831 6.8%
EBITDA 26,354 22,005 19.8%
MARGIN % 33.9% 30.2% 3.7
(1) Hotel Results exclude 6 hotels without prior year results, 9 hotels
sold during 2000 and 2001 and Six Sigma implementation costs of
$6,717 in 2001.
(2) See next page for breakdown by division.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotel Results - Comparable (1)
For the Six Months Ending June 30, 2001
UNAUDITED ($ thousands)
EUROPE
2001 2000 Var.
OWNED HOTELS 30 Hotels
TOTAL REVENUE 272,545 263,666 3.4%
TOTAL EBITDA 84,433 76,368 10.6%
MARGIN % 31.0% 29.0% 2.0
SHERATON 12
REVENUE 98,499 97,954 0.6%
EBITDA 25,955 24,974 3.9%
MARGIN % 26.4% 25.5% 0.9
WESTIN 9
REVENUE 96,286 92,881 3.7%
EBITDA 32,124 29,389 9.3%
MARGIN % 33.4% 31.6% 1.8
LUXURY COLLECTION 9
REVENUE 77,760 72,831 6.8%
EBITDA 26,354 22,005 19.8%
MARGIN % 33.9% 30.2% 3.7
LATIN AMERICA
2001 2000 Var.
OWNED HOTELS 14 Hotels
TOTAL REVENUE 128,984 142,089 -9.2%
TOTAL EBITDA 55,937 60,430 -7.4%
MARGIN % 43.4% 42.5% 0.9
SHERATON 11
REVENUE 94,109 106,140 -11.3%
EBITDA 38,736 43,396 -10.7%
MARGIN % 41.2% 40.9% 0.3
WESTIN 3
REVENUE 34,875 35,949 -3.0%
EBITDA 17,201 17,034 1.0%
MARGIN % 49.3% 47.4% 1.9
ASIA PACIFIC
2001 2000 Var.
OWNED HOTELS 3 Hotels
TOTAL REVENUE 20,619 31,616 -34.8%
TOTAL EBITDA 4,999 9,367 -46.6%
MARGIN % 24.2% 29.6% -5.4
SHERATON 3
REVENUE 20,619 31,616 -34.8%
EBITDA 4,999 9,367 -46.6%
MARGIN % 24.2% 29.6% -5.4
(1) Hotel Results exclude 6 hotels without prior year results, 9 hotels
sold during 2000 and 2001 and Six Sigma implementation costs of
$6,717 in 2001.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Debt Portfolio Summary
As of June 30, 2001
UNAUDITED (in millions)
Debt Interest Balance% of Interest
Avg Maturity
Terms Portfolio Rate (in years)
Floating Rate
Debt:
Five-year
term
loan LIBOR + 62.5 $ 850 15% 4.49% 1.3
Term loan
add-on LIBOR + 125 423 8% 5.11% 1.7
Revolving
credit
facility LIBOR + 62.5 527 10% 4.49% 1.7
Senior
credit
facility 1,800 33% 4.63% 1.5
Senior
secured
notes
facility -
Tranche II
loans LIBOR + 275 500 9% 6.61% 1.7
Mortgages
and
other Various 552 10% 6.05% 1.9
Interest
rate
swaps (1,048) -19% 4.61%
Total Floating 1,804 33% 5.63% 1.6
Fixed Rate
Debt:
Sheraton
Holding
public debt 1,296 23% 7.08% 9.7
Convertible
debt
- Series
A & B (1) 501 9% 2.35% 2.4
Mortgages and
other 880 16% 7.34% 9.8
Interest rate
swaps 1,048 19% 6.55%
Total Fixed 3,725 67% 6.36% 8.4
Total Debt $ 5,529 100% 6.12% 4.9
Maturity
<1 Year $564
2 - 3 Years 3,063
4 - 5 Years 589
>5 Years 1,313
Total $5,529
(1) Maturity date reflects the earlier of the first put date or the
maturity date of the credit facility which would be used to refinance
the amount put to the Company.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Hotels under Renovation and/or without Comparable Results
For the Three Months Ended June 30, 2001
Properties under Significant Renovation during the 2nd Quarter 2001
Property Location
Days Inn Lake Shore Drive Chicago, IL
Other Properties without Comparable Results
Property Location
Sheraton Royal Denarau Resort Nadi, Fiji
Hotel Goldener Hirsch Salzburg, Austria
Hotel Bristol, A Westin Hotel Vienna, Austria
Hotel Imperial Vienna, Austria
Sheraton Macuto Resort La Guaira, Venezuela
Four Points Sydney Hotel Sydney, Australia
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Other Company Information
As of and for the Three Months Ended June 30, 2001
UNAUDITED (in millions except share and per share amounts)
Selected Balance Sheet and Cash Flow Items:
Cash and cash equivalents $ 221
Second quarter dividend per share $ 0.20
Capital expenditures $ 110
Debt level $ 5,529
Shares Repurchased (avg. price $33.02/sh (1)) 200,000
(1) Excludes commissions paid.
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
Summary of Portfolio by Properties & Rooms
As of June 30, 2001
PROPERTIES
Sheraton Westin Lux. Col./ Four Points
St. Regis
Owned, leased &
consolidated JVs 68 36 18 7
Unconsolidated joint
ventures 28 9 3 2
Equity interest
properties 96 45 21 9
Managed (third-party
owned) 133 41 21 21
Franchised, represented
& referral 159 27 13 108
Total 388 113 55 138
PROPERTIES
W Other Total
Owned, leased & consolidated JVs 10 25 164
Unconsolidated joint ventures -- 1 43
Equity interest properties 10 26 207
Managed (third-party owned) 4 3 223
Franchised, represented & referral -- 1 308
Total 14 30 738
ROOMS
Sheraton Westin Lux. Col./ Four Points
St. Regis
Owned, leased &
consolidated JVs 27,294 13,927 3,729 1,894
Unconsolidated joint
ventures 10,983 3,763 671 328
Equity interest
properties 38,277 17,690 4,400 2,222
Managed (third-party
owned) 45,109 20,402 4,540 3,792
Franchised, represented
& referral 46,423 8,680 2,043 19,746
Total 129,809 46,772 10,983 25,760
ROOMS
W Other Total
Owned, leased & consolidated JVs 3,325 6,445 56,614
Unconsolidated joint ventures -- 132 15,877
Equity interest properties 3,325 6,577 72,491
Managed (third-party owned) 596 971 75,410
Franchised, represented
& referral -- 491 77,383
Total 3,921 8,039 225,284
SOURCE Starwood Hotels & Resorts Worldwide, Inc.
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http://www.starwoodhotels.com
Company News On-Call:
http://www.prnewswire.com/comp/443150.html
CONTACT:
Dan Gibson of Starwood Hotels & Resorts
Worldwide, Inc., +1-914-640-8175
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