The 141-room Holiday Inn Express Gadsden-Attalla, Ala. was sold for $1.5 million, with net proceeds being used to reduce debt. For the twelve months ended August 31, 2005, the hotel produced Adjusted EBITDA (a non-GAAP financial measure) of $(45,000) and a net loss from operations of $(182,000). Jones Lang LaSalle Hotels-Select Service Division brokered the sale of the property.
The 422-room Holiday Inn Rolling Meadows, Ill., was sold for $5.0 million, with net proceeds being used for general corporate purposes. For the twelve months ended August 31, 2005, the hotel produced Adjusted EBITDA (a non-GAAP financial measure) of $(363,000) and a net loss from operations of $(383,000). CB Richard Ellis Hotels brokered the sale of the property.
The sales are part of the company's previously announced plan to dispose of non-core properties from its portfolio. Since the program was announced in 2003, Lodgian has sold 20 hotels (including these two properties), two land parcels and an office building, and reduced its debt by $71.7 million.
"We currently are marketing two hotels and one land parcel for sale," said Ed Rohling, president and chief executive officer. "Our core renovation program is nearly complete, with refurbishments in progress at six hotels. Our portfolio is in excellent physical condition, and our goal moving forward is to take maximum advantage of those upgrades."
Below is a reconciliation, for the two hotels sold, of GAAP net loss from operations with Adjusted EBITDA (a non-GAAP financial measure) for the twelve months ended August 31, 2005:
(in thousands) (in thousands)
Holiday Inn Express Gadsden, AL Holiday Inn Rolling Meadows, IL
Net (loss)/income from Net (loss)/income
operations ($182) from operations ($383)
Depreciation and Depreciation and
amortization 64 amortization 20
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Interest expense 73
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Adjusted EBITDA ($45) Adjusted EBITDA ($363)
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Adjusted EBITDA | Adjusted EBITDA is a non-GAAP measure and should not be used as a substitute for measures such as net income (loss), cash flows from operating activities, or other measures computed in accordance with GAAP. The company uses Adjusted EBITDA to measure its performance and to assist in the assessment of hotel property values. Adjusted EBITDA is also a widely used industry measure which Lodgian believes provides pertinent information to investors and is an additional indicator of the company's operating performance.
The company defines Adjusted EBITDA as EBITDA excluding the effects of certain charges such as pre-emergence reorganization expenses, post-emergence Chapter 11 expenses included in corporate and other on the company's consolidated statement of operations, impairment losses and casualty losses for damage caused to Lodgian's properties by the hurricanes that struck the southeastern United States in the 2004 third quarter.
About Lodgian | Lodgian is one of the largest independent owners and operators of full-service hotels in the United States. The company currently manages a portfolio of 78 hotels with 14,121 rooms located in 29 states and Canada. Of the company's 78-hotel portfolio, 49 are InterContinental Hotels Group brands (Crowne Plaza, Holiday Inn, Holiday Inn Select and Holiday Inn Express), 16 are Marriott brands (Courtyard by Marriott, Fairfield Inn, SpringHill Suites and Residence Inn), and 11 are affiliated with three other nationally recognized hospitality franchisors. Two hotels are independent, unbranded properties. For more information about Lodgian, visit the company's Web site:
www.lodgian.com.
Forward-Looking Statements
This press release includes forward-looking statements related to Lodgian's operations that are based on management's current expectations, estimates and projections. These statements are not guarantees of future performance and actual results could differ materially. The words "may," "should," "expect," "believe," "anticipate," "project," "estimate," "plan," and similar expressions are intended to identify forward-looking statements. Certain factors are not within the company's control and readers are cautioned not to put undue reliance on forward-looking statements. These statements involve risks and uncertainties including, but not limited to, the company's ability to generate sufficient working capital from operations and other risks detailed from time to time in the company's SEC reports. The company undertakes no obligations to update events to reflect changed assumptions, the occurrence of unanticipated events or changes to future results over time
Jerry Daly
