Hurricane Damage Hits Lodgian's First Quarter Numbers

Adjusted EBITDA was $7.5 million versus $13.3 million a year ago at this time. Total loss from continuing operations was $6 million compared to a loss of $5.9 million in the same period last year. Room revenue was down 2.8% to $54.5 million versus $56.1 million in first quarter 2004.

However, RevPAR increased 4.5% for the company's 73 continuing operations hotels that were open in both quarters. Excluding hotels under major renovation in either period, RevPAR improved 5.4%. RevPar was fueled by a 5.9% increase in average daily room rate and was partially offset by a 1.3% decline in occupancy.

"We are making substantial headway in repairing our hurricane damaged hotels, as well as with our ongoing renovation program at our core hotels," says W. Thomas Parrington, Lodgian's president and CEO. "Six of the eight hurricane-damaged properties are now fully operational, including three where repairs and renovations were completed the 2005 first quarter."

Major renovations at 13 properties were completed in 2004 and 33 have now been completed since Lodgian's overall renovation program began in 2002. "Our two Florida properties [the Crowne Plaza West Palm Beach and the Holiday Inn Melbourne] that were particularly hard-hit by the hurricanes are expected to re-open in the third or fourth quarter," Parrington adds. "By year-end, approximately 65% of our continuing operations hotels will have completed major upgrades."

The Lodgian chief expects 2005 net income from the 73 hotels to be zero to $3 million and adjusted EBITDA to be $60 million to $62 million on total revenue of $315 million to $325 million. RevPAR is expected to increase to 6% to 7%, net of renovation displacement, Parrington says.