Company Results

Pebblebrook Hotel Trust Provides 2014 Outlook

'We believe 2014 will be another solid year for the overall hotel industry and Pebblebrook as the U.S. economy continues to grow and the industry experiences healthy demand growth in travel, from both business and leisure'

Pebblebrook Hotel Trust

Pebblebrook Hotel Trust (NYSE: PEB) last week provided its Outlook for 2014. The Company's Outlook for 2014, which incorporates the impact of the company’s various capital investment projects and assumes no additional acquisitions, continued improvement in economic activity, positive business travel trends and other significant assumptions, is as follows:

   
2014 Outlook
Low     High

(in millions except per share/unit,

margin and RevPAR data)

Net income (loss)

$64.1

   

$69.1

Net income (loss) per diluted share

$0.99

$1.07

 
Adjusted EBITDA(1) $177.5 $182.5
 
Adjusted FFO(1) $115.4 $120.4
Adjusted FFO per diluted share(1) $1.78 $1.86

 

This 2014 Outlook is based on the following estimates and assumptions:

 
U.S. GDP Growth 2.0% 2.5%
U.S. Hotel Industry RevPAR Growth(2) 5.0% 6.0%
 
Same-Property Portfolio RevPAR(2,3) $195 $197
Pro Forma Portfolio RevPAR Growth(2,3) 6.5% 7.5%
 
 
Pro Forma Portfolio Hotel EBITDA(3) $195.0 $200.0
Pro Forma Portfolio Hotel EBITDA Margin(3) 30.0% 30.5%
Pro Forma Portfolio Hotel EBITDA Margin Growth(3) 125 bps 175 bps
 
 
Corporate cash general and administrative expenses $13.5 $13.5
Corporate non-cash general and administrative expenses $6.5 $6.5
Weighted average fully diluted shares and units 64.8 64.8

 

 

(1)

See tables later in this press release for a reconciliation of net income (loss) to non-GAAP financial measures, including earnings before interest, taxes, depreciation and amortization ("EBITDA"), Adjusted EBITDA, Funds from Operations ("FFO"), Adjusted FFO and Adjusted FFO per diluted share.

 

(2)

“RevPAR” is defined as rooms revenue per available room.

 

(3)

The Company’s estimates and assumptions for pro forma portfolio RevPAR, pro forma portfolio RevPAR growth, pro forma portfolio EBITDA, pro forma portfolio EBITDA margin and pro forma hotel EBITDA margin growth for 2014 include the hotels owned as of December 31, 2013 as if they had been owned by the Company for the entire year of 2013.

 

“We believe 2014 will be another solid year for the overall hotel industry and Pebblebrook as the U.S. economy continues to grow and the industry experiences healthy demand growth in travel, from both business and leisure,” noted Jon Bortz, Chairman, President and Chief Executive Officer of Pebblebrook Hotel Trust. “The strong demand growth and favorable supply dynamics in most urban markets should allow for accelerating pricing power and higher average daily rates, which we are reflecting in our U.S. industry RevPAR growth forecast of 5.0% to 6.0% versus 2013. Our portfolio, comprised of high quality hotels located in major gateway cities with an emphasis on the west coast, should continue to outperform the industry by benefitting from their recent renovations and the overall strength of the markets where they are located. We’re forecasting Same-Property Portfolio RevPAR to increase 6.5% to 7.5%, which already takes into account expected renovation disruption at a number of our hotels.”

The Company’s 2014 Outlook incorporates the disruption associated with the comprehensive renovation and repositioning of the 355-room Radisson Hotel Fisherman’s Wharf, which is expected to commence in the fourth quarter of 2014; a comprehensive renovation of the 125-room Hotel Vintage Park Seattle, which began in the fourth quarter of 2013; the restaurant, lobby and rooms renovation at the 196-room Hotel Palomar San Francisco, which commenced in the first quarter of 2014; a guestrooms and public areas renovation of the 258-room W Los Angeles-Westwood, which is expected to begin in the fourth quarter of 2014; and the renovation of the lobby and atrium at the 337-room Embassy Suites San Diego Bay Downtown, which is planned to commence in the fourth quarter of 2014.

If any of the foregoing estimates and assumptions prove to be inaccurate, actual results, including the 2014 Outlook, may vary, and could vary significantly, from the amounts shown above.

The Company will report financial results for the fourth quarter and full year 2013 on Thursday, February 20, 2014, after the market closes. The Company will conduct its quarterly conference call on Friday, February 21, 2014, at 10:00 AM EST. To participate in the conference call, dial (888) 329-8877 approximately ten minutes before the call begins (9:50 AM EST), tell the operator that you are calling for Pebblebrook Hotel Trust’s Fourth Quarter and Full Year 2013 Earnings Conference Call, and state your full name and company affiliation, and you will then be connected to the call.

About Pebblebrook Hotel Trust

Pebblebrook Hotel Trust (NYSE: PEB) is a publicly traded real estate investment trust (“REIT”) organized to opportunistically acquire and invest primarily in upper upscale, full-service hotels located in urban markets in major gateway cities. The Company owns 29 hotels, including 23 wholly owned hotels with a total of 5,546 guest rooms and a 49% joint venture interest in six hotels with a total of 1,775 guest rooms. The Company owns, or has an ownership interest in, hotels located in ten states and the District of Columbia, including: Los Angeles, California (Hollywood, Santa Monica, West Hollywood and Westwood); San Diego, California; San Francisco, California; Miami, Florida; Buckhead, Georgia; Bethesda, Maryland; Boston, Massachusetts; Minneapolis, Minnesota; New York, New York; Portland, Oregon; Philadelphia, Pennsylvania; Columbia River Gorge, Washington; Seattle, Washington; and Washington, DC.



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