SOURCE: Supertel Hospitality, Inc.

Supertel Hospitality, Inc.

November 13, 2014 16:32 ET

Supertel Hospitality Reports 2014 Third Quarter Results

NORFOLK, NE--(Marketwired - November 13, 2014) - Supertel Hospitality, Inc. (NASDAQ: SPPR), a real estate investment trust (REIT), today announced its results for the third quarter ended September 30, 2014. 

Third Quarter Key Events 

  • Revenue from continuing operations was $16.9 million, an increase of 8.2 percent over the same 2013 period.
  • Revenue per available room (RevPAR) for the continuing operations hotels was $47.36, an increase of 8.3 percent over the same 2013 period.
  • Sold four hotels in the third quarter and three hotels following the close of the quarter.
  • Adjusted EBITDA was $4.8 million, an increase of 5.1 percent over the same 2013 period.
  • Adjusted funds from operations (AFFO) was $1.7 million, an increase of 9.0 percent over the same 2013 period.
  • Net loss attributable to common shareholders was $(3.3) million.

Third Quarter Operating and Financial Results

Supertel's third quarter 2014 revenue from continuing operations rose 8.2 percent to $16.9 million compared to the same year-ago period. Revenue per available room (RevPAR) improved by 8.3 percent to $47.36 over third quarter 2013, driven primarily by increased occupancy. The increase was due in part to improved results at four hotels rebranded in 2013, contributing an additional $0.5 million in revenue over the third quarter 2013. Two hotels that were impacted by a market downturn are recovering due to improving overall market conditions in the Washington D.C. market, contributing an additional $0.6 million in revenue over third quarter 2013. Third quarter 2014 results were also impacted by heightened construction business in the Midwest, along with market-centric rate and sales strategies utilized to capitalize on increased demand and muted supply growth. Additionally, stronger leisure demand throughout the summer served as a contributing factor to third quarter results.

The company had a 2014 third quarter net loss attributable to common shareholders of $(3.3) million, or $(0.69) per basic and diluted share, compared to net earnings of $0.86 million or $0.30 per basic share and $(0.13) per diluted share for the same 2013 period. The loss was primarily due to the non-cash impact of an increase in the valuation of the derivative liabilities for the quarter. The fair value of the derivative liabilities increased by an aggregate of $4.6 million and decreased by an aggregate of $2.7 million during the third quarter of 2014 and 2013, respectively. The change in fair value is recorded as a derivative gain or loss. The loss in the current quarter is due to the rise in the common stock price.

Funds from operations (FFO) was $(2.9) million for the 2014 third quarter, compared to $2.5 million in the same 2013 period. Adjusted funds from operations (AFFO), which is FFO adjusted to exclude gains and losses on derivative liabilities, acquisition and termination expense, and terminated equity transactions expense, in the 2014 third quarter was $1.7 million, compared to $1.6 million in the same 2013 period.

Earnings before interest, taxes, depreciation and amortization (EBITDA) were $0.5 million for the 2014 third quarter, compared to $4.7 million in the same year-ago period. Adjusted EBITDA was $4.8 million, compared to $4.6 million for the 2013 third quarter. Adjusted EBITDA is EBITDA before noncontrolling interest, net gain/loss on disposition of assets, impairment, preferred stock dividends, unrealized gain/loss on derivatives, acquisition and termination expense and terminated equity transactions expense.

In the third quarter 2014, the 47-hotel same store portfolio reported an increase in revenue per available room (RevPAR) of 8.3 percent to $47.36, led by a 6.6 percent improvement in occupancy to 71.5 percent, and a 1.6 percent increase in average daily rate (ADR) to $66.26, compared to the 2013 third quarter. 

"The results we have seen within our existing core portfolio are encouraging as RevPAR growth remains strong and continues to bolster recent operating results," said Kelly Walters, Supertel's President and Chief Executive Officer. "We are pleased to see our portfolio perform in line with our peers and industry averages." 

"Our strategic capital investment in the legacy hotels, combined with our enhanced rate and sales strategies are providing solid results throughout our portfolio with many of our core assets leading the way," said Jeffrey Dougan, Supertel's Chief Operating Officer.

Disposition Program

In the 2014 third quarter the company sold four hotels with an aggregate of 488 rooms for combined gross proceeds of $6.5 million. The proceeds were used to reduce debt.

The four sold hotels include:

  • 172-room Savannah Suites in Jonesboro, Georgia sold July 15, 2014 for $1.4 million
  • 140-room Savannah Suites in Stone Mountain, Georgia sold August 21, 2014 for $1.5 million
  • 60-room Super 8 in Moberly, Missouri sold September 19, 2014 for $1.7 million
  • 116-room Super 8 in Omaha ("M" Street), Nebraska sold September 30, 2014 for $1.9 million

Following the close of the 2014 third quarter, the company sold the following hotels:

  • 79-room Days Inn (Empire) in Sioux Falls, South Dakota sold October 15, 2014 for $2.4 million
  • 148-room Days Inn in Shreveport, Louisiana sold October 17, 2014 for $1.3 million
  • 117-room Super 8 in Terre Haute, Indiana sold November 6, 2014 for $1.9 million

Proceeds from the sales were used to pay down associated debt and reduce the balance of the revolving credit facility.

As of the date of this release, the company is marketing nine hotels for sale and expects to generate approximately $24.4 million in gross proceeds.

Capital Reinvestment

The company invested $0.9 million in capital improvements throughout the portfolio in the 2014 third quarter and $2.2 million year to date to upgrade its properties and maintain brand standards. Notable capital improvements in the third quarter included a lobby and fitness center expansion and renovation at the Green Bay, Wisconsin Super 8, and interior pool enhancements and exterior patio upgrades at the Fort Wayne, Indiana Comfort Suites.

Balance Sheet

On August 1, 2014, Supertel's revolving credit facility with Great Western Bank was extended to June 30, 2015. Additionally, the interest rate was reduced from 4.95 percent to 4.5 percent.

As of September 30, 2014, Supertel had $81 million in outstanding debt on its continuing operations hotels with an average term of 2.2 years and weighted average annual interest rate of 6.4 percent.

Dividends

The company did not declare a dividend on common stock in the 2014 third quarter. The company's board of directors elected to suspend the payment of monthly dividends commencing December 31, 2013 on the outstanding shares of its 8.00% Series A Cumulative Convertible Preferred Stock (NASDAQ: SPPRP), quarterly dividends on the outstanding shares of its 10.00% Series B Preferred Cumulative Stock (NASDAQ: SPPRO), and the quarterly dividends on the outstanding shares of its 6.25% Series C Cumulative Convertible Preferred Stock to preserve capital and improve liquidity. The board of directors will continue to monitor the dividend policy.

Outlook

"Just over five years ago, Supertel embarked on a strategy to reduce its debt burden and improve operational margins by methodically monetizing the outdated and underperforming non-core assets in the portfolio, and to date we have sold more than half of the hotels we owned at the beginning of the recession which began in 2008," said Walters. "Concurrently, we strengthened our management capabilities, both internally and externally, and the benefits of that re-engineering are now showing in our RevPAR growth and improving AFFO performance, which was up 8.3 percent and 9.0 percent, respectively, for continuing operations hotels in the third quarter." 

"Looking toward 2015, we believe the company's core portfolio is situated to capture its share of the industry's continuing RevPAR growth. The Smith Travel Research forecast for 2015 calls for RevPAR growth of approximately 4.5 percent in our segments of the chain scale, and our budgets will reflect those forecasts. Our challenge remains acquiring the necessary cost effective capital to sustain operations and to fuel growth."

About Supertel Hospitality, Inc.

Supertel Hospitality, Inc. (NASDAQ: SPPR) is a self-administered real estate investment trust that specializes in the ownership of select-service hotels. The company currently owns 56 hotels comprising 4,799 rooms in 20 states. Supertel's hotels are franchised by a number of the industry's most well-regarded brand families including Hilton, Choice and Wyndham. For more information or to make a hotel reservation, visit www.supertelinc.com.

Forward Looking Statement

Certain matters within this press release are discussed using forward-looking language as specified in the Private Securities Litigation Reform Act of 1995, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statement. These risks are discussed in the Company's filings with the Securities and Exchange Commission.

Selected Financial Data:

  
Balance Sheets 
As of September 30, 2014 and December 31, 2013 
(In thousands, except share and per share data) 
              
   As of  
   September 30,   December 31,  
   2014   2013  
     (unaudited)        
              
ASSETS             
 Investments in hotel properties  $ 192,953   $ 194,078  
 Less accumulated depreciation    70,574     68,475  
     122,379     125,603  
              
 Cash and cash equivalents    499     45  
 Accounts receivable, net of allowance for doubtful accounts of $33 and $20    2,021     1,083  
 Prepaid expenses and other assets    6,246     4,000  
 Deferred financing costs, net    1,990     2,601  
 Investment in hotel properties, held for sale, net    24,087     38,753  
   $ 157,222   $ 172,085  
              
LIABILITIES AND EQUITY             
LIABILITIES             
 Accounts payable, accrued expenses and other liabilities  $ 10,250   $ 7,745  
 Derivative liabilities, at fair value    20,125     5,907  
 Debt related to hotel properties held for sale    16,235     35,224  
 Long-term debt    80,971     82,821  
     127,581     131,697  
              
Redeemable preferred stock             
 10% Series B, 800,000 shares authorized; $.01 par value, 332,500 shares outstanding, liquidation preference of $8,312    7,662     7,662  
              
EQUITY             
Shareholders' equity             
 Preferred stock, 40,000,000 shares authorized;             
  8% Series A, 2,500,000 shares authorized, $.01 par value, 803,270 shares outstanding, liquidation preference of $8,033    8     8  
  6.25% Series C, 3,000,000 shares authorized, $.01 par value, 3,000,000 shares outstanding, liquidation preference of $30,000    30     30  
  Common stock, $.01 par value, 200,000,000 shares authorized; 4,689,977 and 2,897,539 shares outstanding    47     29  
 Additional paid-in capital    137,892     135,293  
 Distributions in excess of retained earnings    (116,092 )   (102,747 )
  Total shareholders' equity    21,885     32,613  
Noncontrolling interest             
 Noncontrolling interest in consolidated partnership, redemption value $24 and $87    94     113  
              
 Total equity    21,979     32,726  
              
COMMITMENTS AND CONTINGENCIES             
   $ 157,222   $ 172,085  
         
         
  
Statement of Operations 
For the three and nine months ended September 30, 2014 and 2013, respectively 
(Unaudited - In thousands, except per share data) 
                          
   Three Months Ended   Nine Months Ended  
   September 30,   September 30,  
     2014     2013     2014     2013  
REVENUES                         
 Room rentals and other hotel services  $ 16,902   $ 15,619   $ 44,251   $ 41,789  
                          
EXPENSES                         
 Hotel and property operations    12,009     11,436     32,933     32,146  
 Depreciation and amortization    1,624     1,554     4,844     4,676  
 General and administrative    912     946     2,989     2,986  
 Acquisition and termination expense    0     679     0     728  
 Terminated equity transactions    11     1,082     76     1,082  
     14,556     15,697     40,842     41,618  
                          
EARNINGS (LOSS) BEFORE NET GAIN (LOSS) ON DISPOSITIONS OF ASSETS, OTHER INCOME, INTEREST EXPENSE AND INCOME TAXES   

2,346
   

(78
)  

3,409
   

171
 
                          
Net gain (loss) on dispositions of assets    63     (9 )   36     (46 )
Derivative gain (loss)    (4,615 )   2,674     (14,218 )   4,494  
Other income (loss)    (12 )   (3 )   113     11  
Interest expense    (1,774 )   (1,454 )   (5,321 )   (4,124 )
Loss on debt extinguishment    (37 )   (43 )   (141 )   (250 )
Impairment    0     (165 )   119     (171 )
                          
EARNINGS (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES   
(4,029
)  
922
   
(16,003
)  
85
 
                          
Income tax expense    0     0     0     0  
                          
EARNINGS (LOSS) FROM CONTINUING OPERATIONS    (4,029 )   922     (16,003 )   85  
                          
Gain (loss) from discontinued operations, net of tax    1,628     777     2,639     (73 )
                          
NET EARNINGS (LOSS)    (2,401 )   1,699     (13,364 )   12  
                          
Loss (earnings) attributable to non-controlling interest    3     (3 )   19     0  
                          
NET EARNINGS (LOSS) ATTRIBUTABLE TO CONTROLLING INTERESTS   
(2,398
)  
1,696
   
(13,345
)  
12
 
                          
Preferred stock dividends declared and undeclared    (868 )   (837 )   (2,572 )   (2,512 )
                          
NET EARNINGS (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS  
$

(3,266
) 
$

859
  
$

(15,917
) 
$

(2,500
)
                          
NET EARNINGS (LOSS) PER COMMON SHARE - BASIC AND DILUTED                         
EPS from continuing operations - Basic  $ (1.04 ) $ 0.03   $ (5.11 ) $ (0.84 )
EPS from discontinued operations - Basic  $ 0.35   $ 0.27   $ 0.73   $ (0.03 )
EPS Basic - Total  $ (0.69 ) $ 0.30   $ (4.38 ) $ (0.87 )
EPS Diluted - Total  $ (0.69 ) $ (0.13 ) $ (4.38 ) $ (0.87 )
                          
                 
  
Reconciliation of Non-GAAP Financial Measures - Funds From Operations 
(Unaudited - In thousands, except per share data) 
                          
   Three months   Nine Months  
   ended September 30,   ended September 30,  
   2014     2013     2014     2013  
RECONCILIATION OF NET EARNINGS (LOSS) TO FFO                         
Net earnings (loss) attributable to common shareholders  $ (3,266 ) $ 859   $ (15,917 ) $ (2,500 )
Depreciation and amortization    1,624     1,749     4,956     5,551  
Net (gain) loss on disposition of assets    (2,168 )   (365 )   (2,776 )   (1,662 )
Impairment    921     263     1,398     1,723  
 FFO available to common shareholders  $ (2,889 ) $ 2,506   $ (12,339 ) $ 3,112  
Unrealized (gain) loss on derivatives    4,615     (2,674 )   14,218     (4,494 )
Gain on debt conversion    0     0     (88 )   0  
Acquisition and termination expense    0     679     0     728  
Terminated equity transactions    11     1,082     76     1,082  
 Adjusted FFO  $ 1,737   $ 1,593   $ 1,867   $ 428  
                          
Numerator: diluted Adjusted FFO                         
Adjusted FFO attributable to common shareholders - basic  $ 1,737   $ 1,593   $ 1,867   $ 428  
 Preferred C dividend    491     469     1,451     1,406  
 Convertible loan interest    0     0     85     0  
Adjusted FFO attributable to common shareholders - diluted  $ 2,228   $ 2,062   $ 3,403   $ 1,834  
                          
calculation of FFO per share - basic    4,686     2,891     3,630     2,889  
calculation of FFO per share - diluted    4,686     10,392     3,630     10,391  
                          
Denominator:                         
Weighted average number                         
 of common shares - basic Adjusted FFO    4,686     2,891     3,630     2,889  
 Restricted stock    1     1     7     2  
 Convertible loan    0     0     737     0  
 Preferred stock    18,750     3,750     9,904     3,750  
 Warrants    3,750     3,750     3,750     3,750  
 of common shares - diluted Adjusted FFO    27,187     10,392     18,028     10,391  
                          
FFO per share - basic  $ (0.62 ) $ 0.87   $ (3.40 ) $ 1.08  
Adjusted FFO per share - basic  $ 0.37   $ 0.55   $ 0.51   $ 0.15  
FFO per share - diluted  $ (0.62 ) $ 0.29   $ (3.40 ) $ 0.43  
Adjusted FFO per share - diluted  $ 0.08   $ 0.20   $ 0.19   $ 0.18  
                 
                 

FFO and Adjusted FFO ("AFFO") are non-GAAP financial measures. We consider FFO and AFFO to be market accepted measures of an equity REIT's operating performance, which are necessary, along with net earnings (loss), for an understanding of our operating results. FFO, as defined under the National Association of Real Estate Investment Trusts (NAREIT) standards, consists of net income computed in accordance with GAAP, excluding gains (or losses) from sales of real estate assets, plus depreciation, amortization and impairment of real estate assets. We believe our method of calculating FFO complies with the NAREIT definition. AFFO is FFO adjusted to exclude gains or losses on derivative liabilities and gain on debt conversion, which are non-cash charges against income and which do not represent results from our core operations. AFFO also adds back acquisition costs and equity offering expense. FFO and AFFO do not represent amounts available for management's discretionary use because of needed capital replacement or expansion, debt service obligations, or other commitments and uncertainties. FFO and AFFO should not be considered as alternatives to net income (loss) (computed in accordance with GAAP) as an indicator of our liquidity, nor are they indicative of funds available to fund our cash needs, including our ability to pay dividends or make distributions. All REITs do not calculate FFO and AFFO in the same manner; therefore, our calculation may not be the same as the calculation of FFO and AFFO for similar REITs.

Diluted FFO per share and diluted Adjusted FFO per share are computed after adjusting the numerator and denominator of the basic computation for the effects of any dilutive potential common shares outstanding during the period. The Company's outstanding stock options and certain warrants to purchase common stock would be antidilutive and are not included in the dilution computation.

We use FFO and AFFO as performance measures to facilitate a periodic evaluation of our operating results relative to those of our peers. We consider FFO and AFFO to be useful additional measures of performance for an equity REIT because it facilitates an understanding of the operating performance of our properties without giving effect to real estate depreciation and amortization, which assume that the value of real estate assets diminishes predictably over time. Since real estate values have historically risen or fallen with market conditions, we believe that FFO and AFFO provide a meaningful indication of our performance. 

  
EBITDA and Adjusted EBITDA 
(Unaudited - In thousands) 
                          
   Three months   Nine months  
   ended September 30,   ended September 30,  
   2014   2013   2014   2013  
RECONCILIATION OF NET EARNINGS (LOSS) TO ADJUSTED EBITDA                         
Net earnings (loss) attributable to common shareholders  $ (3,266 ) $ 859   $ (15,917 ) $ (2,500 )
Interest expense, including discontinued operations    2,033     1,962     6,380     6,409  
Loss on debt extinguishment    157     166     261     937  
Depreciation and amortization,                         
including discontinued operations    1,624     1,749     4,956     5,551  
EBITDA    548     4,736     (4,320 )   10,397  
Noncontrolling interest    (3 )   3     (19 )   0  
Net gain on disposition of assets    (2,168 )   (365 )   (2,776 )   (1,662 )
Impairment    921     263     1,398     1,723  
Preferred stock dividends declared and undeclared    868     837     2,572     2,512  
Unrealized (gain) loss on derivatives    4,615     (2,674 )   14,218     (4,494 )
Gain on debt conversion    0     0     (88 )   0  
Acquisition and termination expense    0     679     0     728  
Terminated equity transactions    11     1,082     76     1,082  
 ADJUSTED EBITDA  $ 4,792   $ 4,561   $ 11,061   $ 10,286  
                 
                          

EBITDA and Adjusted EBITDA are financial measures that are not calculated in accordance with accounting principles generally accepted in the United States of America ("GAAP"). We calculate EBITDA and Adjusted EBITDA by adding back to net earnings (loss) available to common shareholders certain non-operating expenses and non-cash charges which are based on historical cost accounting and we believe may be of limited significance in evaluating current performance. We believe these adjustments can help eliminate the accounting effects of depreciation and amortization and financing decisions and facilitate comparisons of core operating profitability between periods, even though EBITDA and Adjusted EBITDA also do not represent an amount that accrues directly to common shareholders. In calculating Adjusted EBITDA, we add back noncontrolling interest, net (gain) loss on disposition of assets, preferred stock dividends, acquisition expenses and equity offering expense which are cash charges. We also add back impairment and unrealized gain or loss on derivatives and gain on debt conversion, which are non-cash charges.

EBITDA and Adjusted EBITDA do not represent cash generated from operating activities determined by GAAP and should not be considered as alternatives to net income, cash flow from operations or any other operating performance measure prescribed by GAAP. EBITDA and Adjusted EBITDA are not measures of our liquidity, nor are they indicative of funds available to fund our cash needs, including our ability to make cash distributions. Neither do the measurements reflect cash expenditures for long-term assets and other items that have been and will be incurred. EBITDA and Adjusted EBITDA may include funds that may not be available for management's discretionary use due to functional requirements to conserve funds for capital expenditures, property acquisitions, and other commitments and uncertainties. To compensate for this, management considers the impact of these excluded items to the extent they are material to operating decisions or the evaluation of our operating performance. EBITDA and Adjusted EBITDA, as presented, may not be comparable to similarly titled measures of other companies.

 
Property Operating Income (POI) - Continuing and Discontinued Operations
 

This presentation includes non-GAAP financial measures, and should not be considered as an alternative to loss from continuing operations or loss from discontinued operations, net of tax. The company believes that the presentation of hotel property operating income (POI) is helpful to investors, and represents a more useful description of its core operations, as it better communicates the comparability of its hotels' operating results. Same store results for the quarter are for 47 hotels in continuing operations.

                             
Unaudited-in thousands  Three months  Nine months
except statistical data:  ended September 30,  ended September 30,
   2014  2013  2014  2013
Total Same Store Hotels:                            
 Revenue per available room (RevPAR):  $ 47.36    $ 43.74    $ 41.65    $ 39.35  
 Average daily room rate (ADR):  $ 66.26    $ 65.21    $ 64.10    $ 63.77  
 Occupancy percentage:    71.5 %    67.1 %    65.0 %    61.7 %
                             
Revenue from room rentals and other hotel services consists of:                            
Room rental revenue  $ 16,372    $ 15,122    $ 42,720    $ 40,368  
Telephone revenue    2      2      7      7  
Other hotel service revenues    528      495      1,524      1,414  
 Total revenue from room rentals and other hotel services  $ 16,902    $ 15,619    $ 44,251    $ 41,789  
                             
Hotel and property operations expense                            
 Total hotel and property operations expense  $ 12,009    $ 11,436    $ 32,933    $ 32,146  
                             
Property Operating Income ("POI")                            
 Total property operating income  $ 4,893    $ 4,183    $ 11,318    $ 9,643  
                             
POI as a percentage of revenue from room rentals and other hotel services                            
 Total POI as a percentage of revenue    28.9 %    26.8 %    25.6 %    23.1 %
                             
                             
Discontinued Operations                            
                             
Room rentals and other hotel services                            
 Total room rental and other hotel services  $ 3,664    $ 6,063    $ 12,651    $ 20,474  
                             
Hotel and property operations expense                            
 Total hotel and property operations expense  $ 2,841    $ 4,736    $ 9,944    $ 16,856  
                             
Property Operating Income ("POI")                            
 Total property operating income  $ 823    $ 1,327    $ 2,707    $ 3,618  
                             
POI as a percentage of revenue from room rentals and other hotel services                            
 Total POI as a percentage of revenue    22.5 %    21.9 %    21.4 %    17.7 %
                             
                 
 
POI from continuing operations is reconciled to net loss as follows:
(Unaudited - In thousands)
                    
   Three months   Nine months  
   ended September 30,   ended September 30,  
  2014   2013   2014   2013  
                         
                         
Net earnings (loss) from continuing operations  $ (4,029 ) $ 922   $ (16,003 ) $ 85  
Depreciation and amortization    1,624     1,554     4,844     4,676  
Net loss on disposition of assets    (63 )   9     (36 )   46  
Derivative (gain) loss    4,615     (2,674 )   14,218     (4,494 )
Other (income) expense    12     3     (113 )   (11 )
Interest expense    1,774     1,454     5,321     4,124  
Loss on debt extinguishment    37     43     141     250  
General and administrative expense    912     946     2,989     2,986  
Acquisition and termination expense    0     679     0     728  
Equity offering expense    11     1,082     76     1,082  
Impairment expense    0     165     (119 )   171  
POI - continuing operations  $ 4,893   $ 4,183   $ 11,318   $ 9,643  
                          
                          
  
POI from discontinued operations is reconciled to loss from discontinued operations, net of tax, as follows: 
(Unaudited - In thousands) 
                  
                  
   Three months   Nine months  
   ended September 30,   ended September 30,  
   2014   2013   2014   2013  
Gain (loss) from discontinued operations  $1,628   $777   $2,639   $(73 )
Depreciation and amortization from discontinued operations   0    195    112    875  
Net gain on disposition of assets from discontinued operations   (2,105 )  (374 )  (2,740 )  (1,708 )
Interest expense from discontinued operations   259    508    1,059    2,285  
Loss on debt extinguishment   120    123    120    687  
Impairment losses from discontinued operations   921    98    1,517    1,552  
POI - discontinued operations  $823   $1,327   $2,707   $3,618  
                      
                      
   Three months   Nine months  
   ended September 30,   ended September 30,  
   2014   2013   2014   2013  
                      
POI--continuing operations   4,893    4,183    11,318    9,643  
POI--discontinued operations   823    1,327    2,707    3,618  
Total - POI  $5,716   $5,510   $14,025   $13,261  
                      
Total POI as a percentage of revenues   27.8 %  25.4 %  24.6 %  21.3 %
                      
                      
 
Results of Operations
For three and nine months ended September 30, 2014 and 2013, respectively
 

The following table represents our RevPAR, ADR and occupancy by region for the three and nine months ended September 30, 2014 and 2013, respectively. The comparisons of same store operations (excluding held for sale hotels) are for 47 hotels owned as of July 1, 2013 and January 1, 2013, respectively. Same store calculations exclude 12 properties which are held for sale as well as properties which have been sold.

                           
                           
   Three months ended September 30,
2014
 Three months ended September 30,
2013

Region
 Room
Count
 
RevPAR
 
Occ
  
ADR
 Room
Count
 
RevPAR
 
Occ
  
ADR
Mountain  106  $59.68  87.3 % $68.38  106  $51.43  79.4 % $64.75
West North Central  1,150   41.10  73.3 %  56.05  1,150   38.57  71.1 %  54.26
East North Central  723   55.29  74.2 %  74.48  723   56.02  75.1 %  74.60
Middle Atlantic  142   47.56  75.4 %  63.11  142   48.22  76.2 %  63.31
South Atlantic  1,097   51.67  68.2 %  75.76  1,097   43.99  58.6 %  75.06
East South Central  364   45.97  66.8 %  68.84  364   42.72  65.6 %  65.08
West South Central  176   24.26  65.9 %  36.84  176   19.40  48.8 %  39.75
Total Same Store  3,758  $47.36  71.5 % $66.26  3,758  $43.74  67.1 % $65.21
                               
Total Continuing Operations  3,758  $47.36  71.5 % $66.26  3,758  $43.74  67.1 % $65.21
                               
                       
   Nine months ended September 30,
2014
 Nine months ended September 30,
2013
Region  Room
Count
 
RevPAR
 
Occ
  
ADR
 Room
Count
 
RevPAR
 
Occ
  
ADR
Mountain  106  $46.56  75.9 % $61.34  106  $43.31  73.9 % $58.61
West North Central  1,150   35.64  65.9 %  54.07  1,150   34.21  64.3 %  53.21
East North Central  723   46.51  66.1 %  70.36  723   45.03  65.0 %  69.23
Middle Atlantic  142   43.07  71.3 %  60.41  142   43.25  70.5 %  61.39
South Atlantic  1,097   47.70  63.8 %  74.83  1,097   44.25  58.7 %  75.43
East South Central  364   40.32  60.6 %  66.50  364   37.08  57.5 %  64.48
West South Central  176   22.00  59.3 %  37.10  176   18.24  44.3 %  41.20
Total Same Store  3,758  $41.65  65.0 % $64.10  3,758  $39.35  61.7 % $63.77
                               
Total Continuing Operations  3,758  $41.65  65.0 % $64.10  3,758  $39.35  61.7 % $63.77
                               
                       
States included in the Regions     
Mountain  Montana
West North Central  Iowa, Kansas, Missouri and Nebraska
East North Central  Indiana and Wisconsin
Middle Atlantic  Pennsylvania
South Atlantic  Florida, Maryland, North Carolina, Virginia and West Virginia
East South Central  Kentucky and Tennessee
West South Central  Louisiana
   
   
 
Operating Statistics by Chain Scale
For three and nine months ended September 30, 2014 and 2013, respectively 
 

The following table represents our RevPAR, ADR and occupancy by chain scale for the three and nine months ended September 30, 2014 and 2013, respectively. The comparisons of same store operations (excluding held for sale hotels) are for 47 hotels owned as of July 1, 2013 and January 1, 2013, respectively. Same store calculations exclude 12 properties which are held for sale as well as properties which have been sold.

                           
   Three months ended September 30, 2014  Three months ended September 30, 2013

Brand
 Room
Count
 
RevPAR
 
Occ 
 
ADR
 Room
Count
 
RevPAR
 
Occ 
 
ADR
Select Service                              
 Upscale                              
   Hilton Garden Inn  100  $87.53  74.7 % $117.19  100  $80.77  66.6 % $121.36
 Total Upscale  100  $87.53  74.7 % $117.19  100  $80.77  66.6 % $121.36
 Upper Midscale                              
   Comfort Inn / Suites  1,298   55.51  72.0 %  77.14  1,298   52.45  69.6 %  75.37
   Clarion  59   28.47  46.9 %  60.72  59   32.73  53.8 %  60.84
  Total Upper Midscale  1,357  $54.33  70.9 % $76.67  1,357  $51.60  68.9 % $74.88
 Midscale                              
   Sleep Inn  90   34.78  55.8 %  62.29  90   32.88  53.2 %  61.84
   Quality Inn  122   51.82  65.4 %  79.26  122   44.91  56.4 %  79.66
  Total Midscale  212  $44.58  61.3 % $72.70  212  $39.80  55.0 % $72.35
 Economy                              
   Days Inn  642   37.86  71.3 %  53.13  642   32.96  60.4 %  54.55
   Super 8  1,246   42.68  76.0 %  56.17  1,246   39.29  73.3 %  53.59
   Other Economy (1)  201   42.67  57.6 %  74.05  201   38.53  50.3 %  76.62
  Total Economy  2,089  $41.20  72.8 % $56.62  2,089  $37.27  67.1 % $55.51
                               
Total Same Store  3,758  $47.36  71.5 % $66.26  3,758  $43.74  67.1 % $65.21
                               
Total Continuing Operations  3,758  $47.36  71.5 % $66.26  3,758  $43.74  67.1 % $65.21
                               
   1   Includes Rodeway Inn and Independent Brands
      
      
                               
   Nine months ended September 30, 2014  Nine months ended September 30, 2013
Brand  Room
Count
 
RevPAR
 
Occ 
 
ADR
 Room
Count
 
RevPAR
 
Occ 
 
ADR
Select Service                              
 Upscale                              
   Hilton Garden Inn  100  $78.07  68.7 % $113.64  100  $81.48  65.3 % $124.80
 Total Upscale  100  $78.07  68.7 % $113.64  100  $81.48  65.3 % $124.80
 Upper Midscale                              
   Comfort Inn / Suites  1,298  $49.07  66.3 % $74.04  1,298  $46.13  63.6 % $72.54
   Clarion  59   30.27  47.0 %  64.42  59   31.24  47.4 %  65.92
  Total Upper Midscale  1,357  $48.25  65.4 % $73.74  1,357  $45.48  62.9 % $72.32
 Midscale                              
   Sleep Inn  90   39.19  57.5 %  68.11  90   36.81  53.5 %  68.81
   Quality Inn  122   38.67  53.0 %  72.90  122   32.07  44.4 %  72.22
  Total Midscale  212  $38.89  55.0 % $70.77  212  $34.08  48.3 % $70.62
 Economy                              
   Days Inn  642   33.17  63.4 %  52.31  642   31.27  58.2 %  53.75
   Super 8  1,246   35.47  67.1 %  52.85  1,246   33.56  65.3 %  51.42
   Other Economy (1)  201   47.38  62.5 %  75.84  201   44.21  55.2 %  80.03
  Total Economy  2,089  $35.91  65.5 % $54.80  2,089  $33.88  62.1 % $54.54
                               
Total Same Store  3,758  $41.65  65.0 % $64.10  3,758  $39.35  61.7 % $63.77
                               
Total Continuing Operations  3,758  $41.65  65.0 % $64.10  3,758  $39.35  61.7 % $63.77
                               
   1   Includes Rodeway Inn and Independent Brands
      
      

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