Attached files
| file | filename |
|---|---|
| 8-K - 8-K - STRATEGIC HOTELS & RESORTS, INC | bee-mgsdisposition8xk.htm |
| EX-99.1 - EXHIBIT 99.1 - STRATEGIC HOTELS & RESORTS, INC | bee-20140404xex991.htm |
| EX-99.2 - EXHIBIT 99.2 - STRATEGIC HOTELS & RESORTS, INC | bee-20140404xex992.htm |
Exhibit 99.3
UNAUDITED PRO FORMA FINANCIAL INFORMATION
On March 31, 2014, Strategic Hotel Funding, L.L.C., the operating partnership of Strategic Hotels & Resorts, Inc. ("SHR") and certain of its direct and indirect wholly-owned subsidiaries closed on the sale of the Marriott London Grosvenor Square hotel (the "Grosvenor Disposition"). SHR sold the 237-room Marriott London Grosvenor Square hotel for £125.15 million (approximately $207.7 million). The following unaudited pro forma financial information is presented as a result of the Grosvenor Disposition and gives effect to the following transactions: (a) the disposition of the Four Seasons Punta Mita Resort and an adjacent 48-acre land parcel commonly referred to as La Solana on February 28, 2014 and (b) the disposition of the Marriott London Grosvenor Square hotel on March 31, 2014.
The historical financial information as of December 31, 2013 and for the year then ended has been derived from SHR's audited financial statements included in its Annual Report on Form 10-K for the year ended December 31, 2013.
The unaudited pro forma balance sheet data as of December 31, 2013 is presented as if the Grosvenor Disposition had occurred on December 31, 2013. The unaudited pro forma statement of operations data for the year ended December 31, 2013 is presented as if the Grosvenor Disposition had occurred on January 1, 2013.
The unaudited pro forma financial information is presented for informational purposes only and does not purport to represent what SHR's results of operations would actually have been if the transaction had in fact occurred on the earlier date discussed above. It also does not project or forecast SHR's consolidated results of operation for any future date or period.
Strategic Hotels & Resorts, Inc.
Unaudited Pro Forma Consolidated Balance Sheet
December 31, 2013
(In thousands)
Strategic Hotels & Resorts, Inc. Historical Consolidated | Previously Filed Pro Forma Information (1) | Strategic Hotels & Resorts, Inc. Pro Forma | Grosvenor Disposition (2a) | Strategic Hotels & Resorts, Inc. Pro Forma Consolidated | |||||||||||||||
Assets | |||||||||||||||||||
Investment in hotel properties, net | $ | 1,795,338 | $ | 1,795,338 | $ | (62,753 | ) | $ | 1,732,585 | ||||||||||
Goodwill | 38,128 | 38,128 | 38,128 | ||||||||||||||||
Intangible assets, net | 29,502 | 29,502 | (28,845 | ) | 657 | ||||||||||||||
Assets held for sale | 135,901 | (135,901 | ) | — | — | ||||||||||||||
Investment in unconsolidated affiliates | 104,973 | 104,973 | 104,973 | ||||||||||||||||
Cash and cash equivalents | 73,655 | 183,179 | 256,834 | (5,168 | ) | 347,822 | |||||||||||||
96,156 | (2b) | ||||||||||||||||||
Restricted cash and cash equivalents | 75,916 | 75,916 | (4,033 | ) | 71,883 | ||||||||||||||
Accounts receivable, net | 39,660 | 39,660 | (1,179 | ) | 38,481 | ||||||||||||||
Deferred financing costs, net | 8,478 | 8,478 | (386 | ) | 8,092 | ||||||||||||||
Prepaid expenses and other assets | 35,600 | 35,600 | (4,636 | ) | 30,964 | ||||||||||||||
Total assets | $ | 2,337,151 | $ | 47,278 | $ | 2,384,429 | $ | (10,844 | ) | $ | 2,373,585 | ||||||||
Liabilities, Noncontrolling Interests and Equity | |||||||||||||||||||
Liabilities: | |||||||||||||||||||
Mortgages and other debt payable | $ | 1,163,696 | $ | 1,163,696 | $ | (115,958 | ) | $ | 1,047,738 | ||||||||||
Bank credit facility | 110,000 | 110,000 | 110,000 | ||||||||||||||||
Liabilities of assets held for sale | 17,027 | (17,027 | ) | — | — | ||||||||||||||
Accounts payable and accrued expenses | 189,889 | 189,889 | (3,944 | ) | 185,945 | ||||||||||||||
Deferred tax liabilities | 46,137 | 46,137 | 46,137 | ||||||||||||||||
Total liabilities | 1,526,749 | (17,027 | ) | 1,509,722 | (119,902 | ) | 1,389,820 | ||||||||||||
Commitments and contingencies | |||||||||||||||||||
Noncontrolling interests in SHR’s operating partnership | 7,534 | 7,534 | 7,534 | ||||||||||||||||
Equity: | |||||||||||||||||||
SHR’s shareholders’ equity: | |||||||||||||||||||
8.50% Series A Cumulative Redeemable Preferred Stock | 99,995 | 99,995 | 99,995 | ||||||||||||||||
8.25% Series B Cumulative Redeemable Preferred Stock | 87,064 | 87,064 | 87,064 | ||||||||||||||||
8.25% Series C Cumulative Redeemable Preferred Stock | 92,489 | 92,489 | 92,489 | ||||||||||||||||
Common stock | 2,056 | 2,056 | 2,056 | ||||||||||||||||
Additional paid-in capital | 1,705,306 | 1,705,306 | 1,705,306 | ||||||||||||||||
Accumulated deficit | (1,234,952 | ) | 64,305 | (1,170,647 | ) | 92,923 | (2c) | (1,077,724 | ) | ||||||||||
Accumulated other comprehensive loss | (41,445 | ) | (41,445 | ) | 16,135 | (25,310 | ) | ||||||||||||
Total SHR’s shareholders’ equity | 710,513 | 64,305 | 774,818 | 109,058 | 883,876 | ||||||||||||||
Noncontrolling interests in consolidated affiliates | 92,355 | 92,355 | 92,355 | ||||||||||||||||
Total equity | 802,868 | 64,305 | 867,173 | 109,058 | 976,231 | ||||||||||||||
Total liabilities, noncontrolling interests and equity | $ | 2,337,151 | $ | 47,278 | $ | 2,384,429 | $ | (10,844 | ) | $ | 2,373,585 | ||||||||
Notes to Unaudited Pro Forma Consolidated Balance Sheet as of December 31, 2013
1. | Previously Filed Pro Forma Information - The pro forma adjustments filed on SHR's March 6, 2014 Form 8-K were made to account for the disposition of the Four Seasons Punta Mita Resort and the La Solana land parcel for net proceeds of approximately $183.2 million on February 28, 2014. |
2. Grosvenor Disposition - On March 31, 2014, SHR disposed of its ownership interests in the Marriott London Grosvenor Square hotel. The following unaudited pro forma adjustments were made to account for this transaction:
a) | Reflects the elimination of consolidated accounts related to the Marriott London Grosvenor Square hotel. |
b) | Reflects the net proceeds from the Grosvenor Disposition of approximately $96.2 million. |
c) | Reflects a $92.9 million gain related to the Grosvenor Disposition. |
Strategic Hotels & Resorts, Inc.
Unaudited Pro Forma Consolidated Statement of Operations
For the Year Ended December 31, 2013
(in thousands, except per share amounts)
Strategic Hotels & Resorts, Inc. Historical Consolidated | Previously Filed Pro Forma Information (1) | Strategic Hotels & Resorts, Inc. Pro Forma | Grosvenor Disposition (2) | Strategic Hotels & Resorts, Inc. Pro Forma Consolidated | ||||||||||||||
Revenues: | ||||||||||||||||||
Rooms | $ | 506,348 | $ | 506,348 | $ | (26,614 | ) | $ | 479,734 | |||||||||
Food and beverage | 294,969 | 294,969 | (7,412 | ) | 287,557 | |||||||||||||
Other hotel operating revenue | 93,535 | 93,535 | (2,180 | ) | 91,355 | |||||||||||||
Lease revenue | 5,161 | 5,161 | 5,161 | |||||||||||||||
Total revenues | 900,013 | 900,013 | (36,206 | ) | 863,807 | |||||||||||||
Operating Costs and Expenses: | ||||||||||||||||||
Rooms | 144,464 | 144,464 | (5,518 | ) | 138,946 | |||||||||||||
Food and beverage | 225,213 | 225,213 | (3,825 | ) | 221,388 | |||||||||||||
Other departmental expenses | 220,523 | 220,523 | (6,809 | ) | 213,714 | |||||||||||||
Management fees | 27,126 | 27,126 | (2,126 | ) | 25,000 | |||||||||||||
Other hotel expenses | 60,618 | 60,618 | (2,183 | ) | 58,435 | |||||||||||||
Lease expense | 4,818 | 4,818 | 4,818 | |||||||||||||||
Depreciation and amortization | 101,943 | 101,943 | (5,231 | ) | 96,712 | |||||||||||||
Impairment losses and other charges | 728 | 728 | 728 | |||||||||||||||
Corporate expenses | 25,807 | 25,807 | (631 | ) | 25,176 | |||||||||||||
Total operating costs and expenses | 811,240 | 811,240 | (26,323 | ) | 784,917 | |||||||||||||
Operating income | 88,773 | 88,773 | (9,883 | ) | 78,890 | |||||||||||||
Interest expense | (84,276 | ) | (84,276 | ) | 7,087 | (77,189 | ) | |||||||||||
Interest income | 59 | 59 | (6 | ) | 53 | |||||||||||||
Equity in earnings of unconsolidated affiliates | 2,987 | 2,987 | 2,987 | |||||||||||||||
Foreign currency exchange gain | 44 | 44 | (2 | ) | 42 | |||||||||||||
Other expenses, net | (314 | ) | (314 | ) | (314 | ) | ||||||||||||
Income before income taxes | 7,273 | 7,273 | (2,804 | ) | 4,469 | |||||||||||||
Income tax expense | (557 | ) | (557 | ) | 401 | (156 | ) | |||||||||||
Income from continuing operations | $ | 6,716 | $ | 6,716 | $ | (2,403 | ) | $ | 4,313 | |||||||||
Amounts Attributable to SHR: | ||||||||||||||||||
Income from continuing operations | $ | 7,804 | $ | 7,804 | $ | (2,403 | ) | $ | 5,401 | |||||||||
Loss from continuing operations attributable to SHR common shareholders per share: | ||||||||||||||||||
Basic: | $ | (0.08 | ) | $ | (0.08 | ) | $ | (0.09 | ) | (3) | ||||||||
Diluted: | $ | (0.08 | ) | $ | (0.08 | ) | $ | (0.09 | ) | (3) | ||||||||
Notes to Unaudited Pro Forma Consolidated Statement of Operations
For the Year Ended December 31, 2013
1. Previously Filed Pro Forma Information - The pro forma adjustments filed on SHR's March 6, 2014 Form 8-K were made to account for the disposition of the Four Seasons Punta Mita Resort and the La Solana land parcel for net proceeds of approximately $183.2 million on February 28, 2014.
2. | Grosvenor Disposition - On March 31, 2014, SHR disposed of its ownership interest in the Marriott London Grosvenor Square hotel. The consolidated accounts related to the Marriott London Grosvenor Square hotel are reflected as pro forma adjustments to eliminate accounts from continuing operations. There are no pro forma adjustments for nonrecurring items related to this transaction, including the anticipated gain on the Grosvenor Disposition, which will be recognized in discontinued operations in the first quarter of 2014. |
3. | Loss From Continuing Operations Attributable to SHR Common Shareholders Per Share Calculation - The following table calculates the pro forma weighted average basic and diluted loss from continuing operations attributable to SHR common shareholders per share: |
(In thousands, except per share amounts) | ||||||||
Basic | Diluted | |||||||
Historical and pro forma basic and diluted weighted average shares outstanding for the year ended December 31, 2013 | 206,334 | 206,334 | ||||||
Pro forma income from continuing operations attributable to SHR for the year ended December 31, 2013 | $ | 5,401 | $ | 5,401 | ||||
Historical preferred shareholder dividend | (24,166 | ) | (24,166 | ) | ||||
Pro forma loss from continuing operations attributable to SHR common shareholders for the year ended December 31, 2013 | $ | (18,765 | ) | $ | (18,765 | ) | ||
Pro forma loss from continuing operations attributable to SHR common shareholders per share for the year ended December 31, 2013 - basic and diluted | $ | (0.09 | ) | $ | (0.09 | ) | ||