Chesapeake Lodging Results

Chesapeake Lodging Trust Reports Adjusted Hotel EBITDA Margin 60 Basis Point Decrease to 34.6% for Third Quarter

RevPAR: 0.7% decrease for the hotel portfolio over the same period in 2015.

Chesapeake Lodging Trust

Chesapeake Lodging Trust (NYSE:CHSP), a lodging real estate investment trust (REIT), reported today its financial results for the quarter ended September 30, 2016.

HIGHLIGHTS

  • RevPAR: 0.7% decrease for the hotel portfolio over the same period in 2015.
  • Adjusted Hotel EBITDA Margin: 60 basis point decrease to 34.6% for the hotel portfolio over the same period in 2015.
  • Adjusted Hotel EBITDA: $57.0 million.
  • Adjusted Corporate EBITDA: $52.9 million.
  • Net income available to common shareholders: $23.5 million or $0.40 per diluted common share.
  • Adjusted FFO: $42.1 million or $0.71 per diluted common share.

“Pricing pressure from corporate customers continues to be the primary headwind for our portfolio in the second half of 2016,” said James L. Francis, Chesapeake Lodging Trust’s President and Chief Executive Officer. “Although our operators have been able to hold occupancy levels at our hotels at historically high levels, ADRs have been pressured more than expected which in turn has impacted our operating results and margins. In addition, our fourth quarter operating results are expected to be negatively impacted by approximately $1.5 million as a result of the Zika virus and Hurricane Matthew in Miami and operational challenges at our hotels in New Orleans, which we are working to correct. Furthermore, management fee waivers received and favorable property tax adjustments recorded at several of our hotels last year totaling $1.5 million negatively impact our margin comparison in the fourth quarter. We and our hotel operators are intensely focused on both revenue management and cost containment and reduction measures to minimize the impact of the current revenue trends we are experiencing.”

CONSOLIDATED FINANCIAL RESULTS

The following is a summary of the consolidated financial results for the three and nine months ended September 30, 2016 and 2015 (in millions, except share and per share amounts):

  Three Months Ended September 30,       Nine Months Ended September 30,
2016       2015 2016       2015
Total revenue $ 164.5 $ 165.0 $ 474.6 $ 436.4
 
Net income available to common shareholders $ 23.5 $ 24.8 $ 57.3 $ 45.5
Net income per diluted common share $ 0.40 $ 0.42 $ 0.97 $ 0.78
 
Adjusted Hotel EBITDA $ 57.0 $ 58.1 $ 159.6 $ 142.8
 
Adjusted Corporate EBITDA $ 52.9 $ 54.1 $ 145.6 $ 129.7
 
AFFO available to common shareholders $ 42.1 $ 42.9 $ 112.0 $ 97.1
AFFO per diluted common share $ 0.71 $ 0.73 $ 1.90 $ 1.69
 
Weighted-average number of diluted common shares outstanding 58,928,433 58,991,087 58,894,529 57,536,971
 

HOTEL OPERATING RESULTS

Management assesses the operating performance of its hotels irrespective of the hotel owner during the periods compared using the following key operating metrics: occupancy, ADR, RevPAR, Adjusted Hotel EBITDA, and Adjusted Hotel EBITDA Margin. The Trust uses the term "pro forma" to refer to metrics that include, or comparisons of metrics that are based on, the operating results of hotels under previous ownership for either a portion of or the entire period. As of September 30, 2016, the Trust owned 22 hotels. Since two of its hotels owned as of September 30, 2016 were acquired during 2015, the key operating metrics below reflect the pro forma operating results for those hotels for the nine months ended September 30, 2015.

Included in the following table are comparisons of the key operating metrics for the hotel portfolio for the three and nine months ended September 30, 2016 and 2015 (in thousands, except for ADR and RevPAR):

  Three Months Ended September 30,       Nine Months Ended September 30,
2016       2015       Change 2016      

2015(1)

 

      Change
Occupancy 88.8 % 87.9 % 90 bps 85.2 % 82.0 % 320 bps
ADR $ 233.19 $ 237.33 (1.7 )% $ 229.20 $ 230.75 (0.7 )%
RevPAR $ 207.12 $ 208.58 (0.7 )% $ 195.34 $ 189.32 3.2 %
 
Adjusted Hotel EBITDA $ 56,983 $ 58,087 (1.9 )% $ 159,631 $ 149,630 6.7 %
Adjusted Hotel EBITDA Margin 34.6 % 35.2 % (60) bps 33.6 % 32.8 % 80 bps

Hotel EBITDA, Adjusted Hotel EBITDA, Adjusted Hotel EBITDA Margin, Corporate EBITDA, Adjusted Corporate EBITDA, FFO, FFO available to common shareholders and AFFO available to common shareholders are non-GAAP financial measures within the meaning of the rules of the Securities and Exchange Commission. See the discussion included in this press release for information regarding these non-GAAP financial measures.

FINANCING ACTIVITY

On August 1, 2016, the Trust prepaid without penalty its previous mortgage loan secured by the Courtyard Washington Capitol Hill/Navy Yard, which had an outstanding principal balance at the time of $34.0 million, with a borrowing under its revolving credit facility.

CAPITAL MARKETS ACTIVITY

The Trust has not sold any common shares under its continuous at-the-market (ATM) program or repurchased any common shares under its share repurchase program during 2016.

DIVIDENDS

On July 15, 2016, the Trust paid dividends in the amounts of $0.40 per share to its common shareholders and $0.484375 per share to its preferred shareholders, both of record as of June 30, 2016. On September 19, 2016, the Trust declared dividends in the amounts of $0.40 per share payable to its common shareholders and $0.484375 per share payable to its preferred shareholders, both of record as of September 30, 2016. Both dividends were paid on October 14, 2016.

2016 OUTLOOK

The Trust is updating its 2016 outlook to incorporate its third quarter results and recent operating trends and fundamentals. The updated outlook assumes no acquisitions, dispositions, or financing transactions (in millions, except RevPAR and per share amounts):

Fourth Quarter 2016

  Outlook
Low       High
CONSOLIDATED:
 
Net income available to common shareholders $ 7.2 $ 9.3
Net income per diluted common share $ 0.12 $ 0.16
 
Adjusted Corporate EBITDA $ 36.4 $ 38.7
 
AFFO available to common shareholders $ 26.1 $ 28.2
AFFO per diluted common share $ 0.44 $ 0.48
 
Corporate cash general and administrative expense $ 2.0 $ 2.2
Corporate non-cash general and administrative expense $ 2.3 $ 2.3
 
Weighted-average number of diluted common shares outstanding 58.8 58.8
 
22-HOTEL PORTFOLIO:
 
RevPAR $ 170.00 $ 174.00
RevPAR change as compared to 2015 (3.0 )% (1.0 )%
Adjusted Hotel EBITDA $ 40.8 $ 43.3
Adjusted Hotel EBITDA Margin 29.2 % 30.2 %
Adjusted Hotel EBITDA Margin change as compared to 2015 (350) bps (250) bps
 
       

Full Year 2016

Updated Outlook Previous Outlook
Low       High Low       High
CONSOLIDATED:
 
Net income available to common shareholders $ 64.1 $ 66.2 $ 69.6 $ 74.6
Net income per diluted common share $ 1.09 $ 1.13 $ 1.18 $ 1.27
 
Adjusted Corporate EBITDA $ 182.0 $ 184.3 $ 188.0 $ 193.5
 
AFFO available to common shareholders $ 138.1 $ 140.2 $ 143.7 $ 148.7
AFFO per diluted common share $ 2.35 $ 2.39 $ 2.45 $ 2.53
 
Corporate cash general and administrative expense $ 8.9 $ 9.1 $ 9.5 $ 10.0
Corporate non-cash general and administrative expense $ 9.5 $ 9.5 $ 9.5 $ 9.5
 
Weighted-average number of diluted common shares outstanding 58.7 58.7 58.7 58.7
 
22-HOTEL PORTFOLIO:
 
RevPAR $ 189.00 $ 190.00 $ 191.00 $ 194.00
Pro forma RevPAR change as compared to 2015(1) 1.7 % 2.2 % 3.0 % 4.5 %
Adjusted Hotel EBITDA $ 200.4 $ 202.9 $ 207.0 $ 213.0
Adjusted Hotel EBITDA Margin 32.6 % 32.8 % 33.2 % 33.7 %
Pro forma Adjusted Hotel EBITDA Margin change as compared to 2015(1) (10) bps 10 bps 50 bps 100 bps

NON-GAAP FINANCIAL MEASURES

The Trust reports the following eight non-GAAP financial measures that it believes are useful to investors as key measures of its operating performance: (1) Hotel EBITDA, (2) Adjusted Hotel EBITDA, (3) Adjusted Hotel EBITDA Margin, (4) Corporate EBITDA, (5) Adjusted Corporate EBITDA, (6) FFO, (7) FFO available to common shareholders and (8) AFFO available to common shareholders. Reconciliations of these non-GAAP financial measures to the most comparable GAAP measure are included in the accompanying financial tables.

Hotel EBITDA – Hotel EBITDA is defined as net income before interest, income taxes, depreciation and amortization, air rights amortization, corporate general and administrative, and hotel acquisition costs. The Trust believes that Hotel EBITDA provides investors a useful financial measure to evaluate the Trust’s hotel operating performance, excluding the impact of the Trust’s capital structure (primarily interest), the Trust’s asset base (primarily depreciation and amortization), and the Trust’s corporate-level expenses (corporate general and administrative and hotel acquisition costs).

Adjusted Hotel EBITDA – The Trust further adjusts Hotel EBITDA for certain additional recurring and non-recurring items. Specifically, the Trust adjusts for non-cash amortization of intangible assets and liabilities, including ground lease assets and unfavorable contract liabilities, deferred franchise costs, and deferred key money, all of which are recurring items, and gain (losses) from sales of real estate, which is a non-recurring item. The Trust believes that Adjusted Hotel EBITDA provides investors with another useful financial measure to evaluate the Trust’s hotel operating performance, excluding the effect of these non-cash items.

Adjusted Hotel EBITDA Margin – Adjusted Hotel EBITDA Margin is defined as Adjusted Hotel EBITDA as a percentage of total revenues. The Trust believes that Adjusted Hotel EBITDA Margin provides investors another useful financial measure to evaluate the Trust’s hotel operating performance.

Corporate EBITDA – Corporate EBITDA is defined as net income before interest, income taxes, and depreciation and amortization. The Trust believes that Corporate EBITDA provides investors a useful financial measure to evaluate the Trust’s operating performance, excluding the impact of the Trust’s capital structure (primarily interest expense) and the Trust’s asset base (primarily depreciation and amortization).

Adjusted Corporate EBITDA – The Trust further adjusts Corporate EBITDA for certain additional recurring and non-recurring items. Specifically, the Trust adjusts for hotel acquisition costs and non-cash amortization of intangible assets and liabilities, including air rights contracts, ground lease assets and unfavorable contract liabilities, deferred franchise costs, and deferred key money, all of which are recurring items, and gains (losses) from sales of real estate, which is a non-recurring item. The Trust believes that Adjusted Corporate EBITDA provides investors with another financial measure of its operating performance that provides for greater comparability of its core operating results between periods.

FFO – The Trust calculates FFO in accordance with standards established by the National Association of Real Estate Investment Trusts (NAREIT), which defines FFO as net income (calculated in accordance with GAAP), excluding depreciation and amortization, impairment charges of depreciable real estate, gains (losses) from sales of real estate, the cumulative effect of changes in accounting principles, and adjustments for unconsolidated partnerships and joint ventures. Historical cost accounting for real estate assets implicitly assumes that the value of real estate assets diminishes predictably over time. Since real estate values instead have historically risen or fallen with market conditions, most industry investors consider presentations of operating results for real estate companies that use historical cost accounting to be insufficient by themselves. By excluding the effect of depreciation and amortization and gains (losses) from sales of real estate, both of which are based on historical cost accounting and which may be of lesser significance in evaluating current performance, the Trust believes that FFO provides investors a useful financial measure to evaluate the Trust’s operating performance.

FFO available to common shareholders – The Trust reduces FFO for preferred share dividends and dividends declared on and earnings allocated to unvested time-based awards (consistent with adjustments required by GAAP in reporting net income available to common shareholders and related per share amounts). FFO available to common shareholders provides investors another financial measure to evaluate the Trust’s operating performance after taking into account the interests of holders of the Trust’s preferred shares and unvested time-based awards.

AFFO available to common shareholders – The Trust further adjusts FFO available to common shareholders for certain additional recurring and non-recurring items that are not in NAREIT’s definition of FFO. Specifically, the Trust adjusts for hotel acquisition costs and non-cash amortization of intangible assets and liabilities, including air rights contracts, ground lease assets and unfavorable contract liabilities, deferred franchise costs, and deferred key money, all of which are recurring items. The Trust believes that AFFO available to common shareholders provides investors with another financial measure of its operating performance that provides for greater comparability of its core operating results between periods.

ABOUT CHESAPEAKE LODGING TRUST

Chesapeake Lodging Trust is a self-advised lodging real estate investment trust (REIT) focused on investments primarily in upper-upscale hotels in major business and convention markets and, on a selective basis, premium select-service hotels in urban settings or unique locations in the United States. The Trust owns 22 hotels with an aggregate of 6,694 rooms in nine states and the District of Columbia. 

       

CHESAPEAKE LODGING TRUST

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

 
September 30, 2016 December 31, 2015
(unaudited)
 
ASSETS
Property and equipment, net $ 1,887,280 $ 1,926,944
Intangible assets, net 35,980 36,414
Cash and cash equivalents 56,909 50,544
Restricted cash 41,171 40,361
Accounts receivable, net 26,812 15,603
Prepaid expenses and other assets 17,274   17,900  
Total assets $ 2,065,426   $ 2,087,766  
 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Long-term debt $ 749,979 $ 769,748
Accounts payable and accrued expenses 68,498 62,683
Other liabilities 45,153   45,778  
Total liabilities 863,630   878,209  
 
Commitments and contingencies
 

Preferred shares, $.01 par value; 100,000,000 shares authorized;

Series A Cumulative Redeemable Preferred Shares; 5,000,000

shares issued and outstanding ($127,422 liquidation preference)

50 50

Common shares, $.01 par value; 400,000,000 shares authorized;

60,102,459 shares and 59,659,522 shares issued and outstanding, respectively

601 597
Additional paid-in capital 1,304,829 1,297,877
Cumulative dividends in excess of net income (103,497 ) (88,675 )
Accumulated other comprehensive loss (187 ) (292 )
Total shareholders’ equity 1,201,796   1,209,557  
Total liabilities and shareholders’ equity $ 2,065,426   $ 2,087,766  
 
 
SUPPLEMENTAL CREDIT INFORMATION:
Fixed charge coverage ratio(1) 3.32 3.04
Leverage ratio(1) 31.9 % 32.6 %
       

CHESAPEAKE LODGING TRUST

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except share and per share data)

(unaudited)

 
Three Months Ended September 30, Nine Months Ended September 30,
2016       2015 2016       2015
REVENUE
Rooms $ 127,552 $ 128,388 $ 358,291 $ 332,948
Food and beverage 29,633 29,620 95,852 86,032
Other 7,344   7,001   20,428   17,464  
Total revenue 164,529   165,009   474,571   436,444  
 
EXPENSES
Hotel operating expenses:
Rooms 28,532 27,826 81,909 75,070
Food and beverage 22,536 22,769 69,413 64,730
Other direct 1,690 2,061 4,837 5,300
Indirect 54,633   54,111   158,316   148,140  
Total hotel operating expenses 107,391 106,767 314,475 293,240
Depreciation and amortization 18,703 18,306 55,797 51,162
Air rights contract amortization 130 130 390 390
Corporate general and administrative 4,074 4,019 14,074 13,094
Hotel acquisition costs   19     854  
Total operating expenses 130,298   129,241   384,736   358,740  
 
Operating income 34,231 35,768 89,835 77,704
 
Interest expense (8,122 ) (8,287 ) (23,892 ) (23,634 )
Gain on sale of hotel     598    
 
Income before income taxes 26,109 27,481 66,541 54,070
 
Income tax expense (162 ) (301 ) (1,982 ) (1,293 )
 
Net income 25,947 27,180 64,559 52,777
 
Preferred share dividends (2,422 ) (2,422 ) (7,266 ) (7,266 )
Net income available to common shareholders $ 23,525   $ 24,758   $ 57,293   $ 45,511  
 
Net income per common share:
Basic $ 0.40 $ 0.42 $ 0.97 $ 0.79
Diluted $ 0.40 $ 0.42 $ 0.97 $ 0.78
 
Weighted-average number of common shares outstanding:
Basic 58,729,338 58,552,800 58,711,056 57,107,919
Diluted 58,928,433 58,991,087 58,894,529 57,536,971
 
 

CHESAPEAKE LODGING TRUST

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 
Nine Months Ended September 30,
2016       2015
 
Cash flows from operating activities:
Net income $ 64,559 $ 52,777
Adjustments to reconcile net income to net cash provided by

operating activities:

Depreciation and amortization 55,797 51,162
Air rights contract amortization 390 390
Deferred financing costs amortization 1,409 1,410
Gain on sale of hotel (598 )
Share-based compensation 7,150 5,640
Other (681 ) (613 )
Changes in assets and liabilities:
Accounts receivable, net (11,209 ) (11,590 )
Prepaid expenses and other assets 624 (4,821 )
Accounts payable and accrued expenses 4,605 8,311
Other liabilities (33 ) 5,972  
Net cash provided by operating activities 122,013   108,638  
 
Cash flows from investing activities:
Acquisition of hotels, net of cash acquired (255,249 )
Disposition of hotel, net of cash sold 2,028
Improvements and additions to hotels (17,562 ) (30,044 )
Change in restricted cash (810 ) 839  
Net cash used in investing activities (16,344 ) (284,454 )
 
Cash flows from financing activities:
Proceeds from sale of common shares, net of underwriting fees 153,962
Payment of offering costs related to sale of common shares (276 )
Borrowings under revolving credit facility 175,000 315,000
Repayments under revolving credit facility (215,000 ) (200,000 )
Proceeds from issuance of mortgage debt 150,000
Principal prepayments on mortgage debt (122,220 )
Scheduled principal payments on mortgage debt (7,847 ) (7,650 )
Payment of deferred financing costs (935 ) (2,311 )
Payment of dividends to common shareholders (70,842 ) (57,536 )
Payment of dividends to preferred shareholders (7,266 ) (7,266 )
Repurchase of common shares (194 ) (1,698 )
Net cash provided by (used in) financing activities (99,304 ) 192,225  
Net increase in cash 6,365 16,409
Cash and cash equivalents, beginning of period 50,544   29,326  
Cash and cash equivalents, end of period $ 56,909   $ 45,735  
 

The following table reconciles net income to Hotel EBITDA, Adjusted Hotel EBITDA, pro forma Adjusted Hotel EBITDA, and pro forma Adjusted Hotel EBITDA Margin for the three and nine months ended September 30, 2016 and 2015:

         
Three Months Ended September 30, Nine Months Ended September 30,
2016       2015 2016       2015
Net income $ 25,947 $ 27,180 $ 64,559 $ 52,777

Add:

Interest expense

8,122 8,287 23,892 23,634
Income tax expense 162 301 1,982 1,293
Depreciation and amortization 18,703 18,306 55,797 51,162
Air rights contract amortization 130 130 390 390
Corporate general and administrative 4,074 4,019 14,074 13,094
Hotel acquisition costs   19     854  
Hotel EBITDA 57,138 58,242 160,694 143,204
 

Less:

Non-cash amortization(1)

(155 ) (155 ) (465 ) (416 )
Gain on sale of hotel     (598 )  
Adjusted Hotel EBITDA 56,983 58,087 159,631 142,788
 

Add:

Prior owner Hotel EBITDA(2)

      6,842  
Pro forma Adjusted Hotel EBITDA $ 56,983   $ 58,087   $ 159,631   $ 149,630  
 
Total revenue $ 164,529 $ 165,009 $ 474,571 $ 436,444

Add:

Prior owner total revenue(2)

      20,286  
Pro forma total revenue $ 164,529   $ 165,009   $ 474,571   $ 456,730  
 
Pro forma Adjusted Hotel EBITDA Margin 34.6 % 35.2 % 33.6 % 32.8 %

_____________

(1)   Reflects non-cash amortization of ground lease asset, deferred franchise costs, deferred key money, and unfavorable contract liability.
(2) Reflects results of operations for certain hotels prior to our acquisition.
 

The following table reconciles net income to Corporate EBITDA and Adjusted Corporate EBITDA for the three and nine months ended September 30, 2016 and 2015:

    Three Months Ended September 30,       Nine Months Ended September 30,
2016       2015 2016       2015
Net income $ 25,947 $ 27,180 $ 64,559 $ 52,777

Add:

Interest expense

8,122 8,287 23,892 23,634
Income tax expense 162 301 1,982 1,293
Depreciation and amortization 18,703   18,306   55,797   51,162  
Corporate EBITDA 52,934 54,074 146,230 128,866
 

Add:

Hotel acquisition costs

19 854

Less:

Non-cash amortization(1)

(26 ) (25 ) (76 ) (26 )
Gain on sale of hotel     (598 )  
Adjusted Corporate EBITDA $ 52,908   $ 54,068   $ 145,556   $ 129,694  

The following table reconciles net income to FFO, FFO available to common shareholders, and AFFO available to common shareholders for the three and nine months ended September 30, 2016 and 2015:

         
Three Months Ended September 30, Nine Months Ended September 30,
2016       2015 2016       2015
Net income $ 25,947 $ 27,180 $ 64,559 $ 52,777

Add:

Depreciation and amortization

18,703 18,306 55,797 51,162

Less:

Gain on sale of hotel

    (598 )  
FFO 44,650 45,486 119,758 103,939
 

Less:

Preferred share dividends

(2,422 ) (2,422 ) (7,266 ) (7,266 )
Dividends declared on unvested time-based awards (146 ) (153 ) (435 ) (426 )
Undistributed earnings allocated to unvested time-based awards   (8 )    
FFO available to common shareholders 42,082 42,903 112,057 96,247
 

Add:

Hotel acquisition costs

19 854

Non-cash amortization(1)

(26 ) (25 ) (76 ) (26 )
AFFO available to common shareholders $ 42,056   $ 42,897   $ 111,981   $ 97,075  
 
FFO per common share:
Basic $ 0.72 $ 0.73 $ 1.91 $ 1.69
Diluted $ 0.71 $ 0.73 $ 1.90 $ 1.67
 
AFFO per common share:
Basic $ 0.72 $ 0.73 $ 1.91 $ 1.70
Diluted $ 0.71 $ 0.73 $ 1.90 $ 1.69

The following table reconciles forecasted net income to Hotel EBITDA, Adjusted Hotel EBITDA, and Adjusted Hotel EBITDA Margin for the three months and year ending December 31, 2016:

         
Three Months Ending December 31, 2016 Year Ending December 31, 2016
Low     High Low       High
Net income $ 9,770 $ 11,870 $ 74,340 $ 76,440

Add:

Interest expense

7,970 7,970 31,860 31,860
Income tax expense (benefit) (160 ) 40 1,820 2,020
Depreciation and amortization 18,880 18,880 74,680 74,680
Air rights contract amortization 130 130 520 520
Corporate general and administrative 4,310   4,510   18,380   18,580  
Hotel EBITDA 40,900 43,400 201,600 204,100
 

Less:

Non-cash amortization(1)

(150 ) (150 ) (620 ) (620 )
Gain on sale of hotel     (600 ) (600 )
Adjusted Hotel EBITDA $ 40,750   $ 43,250   $ 200,380   $ 202,880  
 
Total revenue $ 139,700 $ 143,400 $ 614,270 $ 617,970
 
Adjusted Hotel EBITDA Margin 29.2 % 30.2 % 32.6 % 32.8 %

The following table reconciles forecasted net income to Corporate EBITDA and Adjusted Corporate EBITDA for the three months and year ending December 31, 2016:

         
Three Months Ending December 31, 2016 Year Ending December 31, 2016
Low     High Low       High
Net income $ 9,770 $ 11,870 $ 74,340 $ 76,440

Add:

Interest expense

7,970 7,970 31,860 31,860
Income tax expense (benefit) (160 ) 40 1,820 2,020
Depreciation and amortization 18,880   18,880   74,680   74,680  
Corporate EBITDA 36,460 38,760 182,700 185,000
 

Less:

Non-cash amortization(1)

(20 ) (20 ) (100 ) (100 )
Gain on sale of hotel     (600 ) (600 )
Adjusted Corporate EBITDA $ 36,440   $ 38,740   $ 182,000   $ 184,300  

The following table reconciles forecasted net income to FFO, FFO available to common shareholders, and AFFO available to common shareholders for the three months and year ending December 31, 2016:

         
Three Months Ending December 31, 2016 Year Ending December 31, 2016
Low     High Low       High
Net income $ 9,770 $ 11,870 $ 74,340 $ 76,440

Add:

Depreciation and amortization

18,880 18,880 74,680 74,680

Less:

Gain on sale of hotel

    (600 ) (600 )
FFO 28,650 30,750 148,420 150,520
 

Less:

Preferred share dividends

(2,420 ) (2,420 ) (9,690 ) (9,690 )
Dividends declared on unvested time-based awards (130 ) (130 ) (570 ) (570 )
Undistributed earnings allocated to unvested time-based awards        
FFO available to common shareholders 26,100 28,200 138,160 140,260
 

Less:

Non-cash amortization(1)

(20 ) (20 ) (100 ) (100 )
AFFO available to common shareholders $ 26,080   $ 28,180   $ 138,060   $ 140,160  
 
FFO per common share—basic and diluted $ 0.44 $ 0.48 $ 2.35 $ 2.39
 
AFFO per common share—basic and diluted $ 0.44 $ 0.48 $ 2.35 $ 2.39
 
Weighted-average number of common shares outstanding—basic and diluted 58,797 58,797 58,736 58,736

CHESAPEAKE LODGING TRUST

CURRENT HOTEL PORTFOLIO

         
 
Hotel Location Rooms Acquisition Date
1   Hyatt Regency Boston Boston, MA 502 March 18, 2010
2 Hilton Checkers Los Angeles Los Angeles, CA 193 June 1, 2010
3 Boston Marriott Newton Newton, MA 430 July 30, 2010
4 Le Meridien San Francisco San Francisco, CA 360 December 15, 2010
5 Homewood Suites Seattle Convention Center Seattle, WA 195 May 2, 2011
6 W Chicago – City Center Chicago, IL 403 May 10, 2011
7 Hotel Indigo San Diego Gaslamp Quarter San Diego, CA 210 June 17, 2011
8 Courtyard Washington Capitol Hill/Navy Yard Washington, DC 204 June 30, 2011
9 Hotel Adagio San Francisco, Autograph Collection San Francisco, CA 171 July 8, 2011
10 Denver Marriott City Center Denver, CO 613 October 3, 2011
11 Hyatt Herald Square New York New York, NY 122 December 22, 2011
12 W Chicago – Lakeshore Chicago, IL 520 August 21, 2012
13 Hyatt Regency Mission Bay Spa and Marina San Diego, CA 429 September 7, 2012
14 The Hotel Minneapolis, Autograph Collection Minneapolis, MN 222 October 30, 2012
15 Hyatt Place New York Midtown South New York, NY 185 March 14, 2013
16 W New Orleans – French Quarter New Orleans, LA 97 March 28, 2013
17 Le Meridien New Orleans New Orleans, LA 410 April 25, 2013
18 Hyatt Centric Fisherman’s Wharf San Francisco, CA 316 May 31, 2013
19 Hyatt Centric Santa Barbara Santa Barbara, CA 200 June 27, 2013
20 JW Marriott San Francisco Union Square San Francisco, CA 337 October 1, 2014
21 Royal Palm South Beach Miami, a Tribute Portfolio Resort Miami Beach, FL 393 March 9, 2015
22 Ace Hotel and Theater Downtown Los Angeles Los Angeles, CA 182 April 30, 2015
6,694



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