-------------------------------------------------------------------------
Three months ended
Year ended
December 31
December 31
-------------------------------------------------------------------------
2004 2003 Variance
2004 2003 Variance
-------------------------------------------------------------------------
OWNED
HOTELS
-------------------------------------------------------------------------
Worldwide
13 properties/
6,364 rooms
-------------------------------------------------------------------------
RevPAR
99.89 84.74 17.9%
117.78 99.69 18.1%
-------------------------------------------------------------------------
ADR
176.50 167.47 5.4%
188.83 179.17 5.4%
-------------------------------------------------------------------------
Occupancy
56.6% 50.6% 6.0 points 62.4%
55.6% 6.8 points
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Canada
7 properties/
3,336 rooms
-------------------------------------------------------------------------
RevPAR
84.76 72.98 16.1%
114.93 99.67 15.3%
-------------------------------------------------------------------------
ADR
149.14 136.18 9.5%
174.01 163.44 6.5%
-------------------------------------------------------------------------
Occupancy
56.8% 53.6% 3.2 points 66.0%
61.0% 5.0 points
-------------------------------------------------------------------------
-------------------------------------------------------------------------
U.S. and
International
6 properties/
3,028 rooms
-------------------------------------------------------------------------
RevPAR
116.55 97.36 19.7%
120.89 99.71 21.2%
-------------------------------------------------------------------------
ADR
206.88 205.49 0.7%
207.11 199.81 3.7%
-------------------------------------------------------------------------
Occupancy
56.3% 47.4% 8.9 points 58.4%
49.9% 8.5 points
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
FAIRMONT MANAGED
HOTELS
-------------------------------------------------------------------------
Worldwide
40 hotels/
19,885 rooms
-------------------------------------------------------------------------
RevPAR
112.95 100.08 12.9%
119.36 104.73 14.0%
-------------------------------------------------------------------------
ADR
187.12 173.07 8.1%
184.66 172.54 7.0%
-------------------------------------------------------------------------
Occupancy
60.4% 57.8% 2.6 points 64.6%
60.7% 3.9 points
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Canada
20 properties/
10,099 rooms
-------------------------------------------------------------------------
RevPAR
85.61 75.27 13.7%
100.18 86.39 16.0%
-------------------------------------------------------------------------
ADR
144.21 129.39 11.5%
153.43 140.38 9.3%
-------------------------------------------------------------------------
Occupancy
59.4% 58.2% 1.2 points 65.3%
61.5% 3.8 points
-------------------------------------------------------------------------
-------------------------------------------------------------------------
U.S. and
International
20 properties/
9,786 rooms
-------------------------------------------------------------------------
RevPAR
140.70 124.88 12.7%
138.75 123.14 12.7%
-------------------------------------------------------------------------
ADR
229.25 217.29 5.5%
216.90 205.70 5.4%
-------------------------------------------------------------------------
Occupancy
61.4% 57.5% 3.9 points 64.0%
59.9% 4.1 points
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
DELTA MANAGED
HOTELS
-------------------------------------------------------------------------
Worldwide
27 properties/
8,171 rooms
-------------------------------------------------------------------------
RevPAR
60.95 54.23 12.4%
64.43 55.36 16.4%
-------------------------------------------------------------------------
ADR
100.52 92.35 8.8%
98.53 91.78 7.4%
-------------------------------------------------------------------------
Occupancy
60.6% 58.7% 1.9 points 65.4%
60.3% 5.1 points
-------------------------------------------------------------------------
Comparable hotels and resorts are considered to be properties
that were fully open under FHR management for at least the entire current
and prior period. Comparable hotels and resorts statistics exclude properties
under major renovation that would have a significant adverse effect on
the properties' primary operations. The following properties were excluded:
Owned: The
Fairmont Southampton; The Fairmont Copley Plaza Boston;
The Fairmont Kea Lani Maui (sold July 2004); The Fairmont
Glitter Bay (sold July 2004)
Fairmont
Managed: The Fairmont
Southampton; The Fairmont Olympic Hotel, Seattle;
The Fairmont Turnberry Isle Resort & Club, Miami; Monte Carlo
Grand Hotel
Delta
Managed: Delta Meadowvale
and Delta franchised hotels
FHR's 2004 quarterly operating statistics for its 2005
comparable hotel portfolios are available on the Company's website (www.fairmont.com/investor).
1. Operating revenues excludes
other revenues from managed and
franchised
properties (consists of direct and indirect costs relating
primarily
to marketing and reservation services that are reimbursed
by hotel owners
on a cost recovery basis). Management considers that
the exclusion
of such revenues provides a meaningful measure of
operating
performance, however, it is not a defined measure of
operating
performance under Canadian generally accepted accounting
principles
("Canadian GAAP"). It is likely that FHR's calculation of
operating
revenues is different than the calculation used by other
entities.
2. EBITDA is defined as earnings
before interest, taxes, amortization,
gain on sales
of investments and hotel assets and other (income)
expenses.
Income from investments and other is included in EBITDA.
Management
considers EBITDA to be a meaningful indicator of hotel
operations
and uses it as the primary measurement of operating
segment profit
and loss. However, it is not a defined measure of
operating
performance under Canadian GAAP. It is likely that FHR's
calculation
of EBITDA is different than the calculations used by
other entities.
Reconciliation of EBITDA to net income:
Three months ended Year ended
December 31 December 31
-------------------------------------------------------------------------
In millions of dollars
2004 2003 2004
2003
-------------------------------------------------------------------------
EBITDA
$ 21 $ 10 $ 181
$ 142
Deduct (Add):
Gain on sales of investments
and
hotel assets
1 - (144)
-
Other (income) expenses,
net
- 2
- 2
Amortization
20 17
74 67
Interest expense, net
7 11
33 34
Income tax expense (recovery)
(3) (6) 62
(12)
-------------------------------------------------------------------------
Net income
$ (4) $ (14) $ 156 $
51
-------------------------------------------------------------------------
3. The Fairmont Kea Lani Maui
and The Fairmont Glitter Bay were sold in
July 2004.
4. The Company's assumption for
the diluted weighted average number of
common shares
is 82.1 million shares. This assumes the issue of
7.2 million
shares relating to the contingently convertible senior
notes and
the add-back of the annual after-tax interest expense
thereon, are
included as dilutive for 2005.
Summary of Hotel Portfolios
-------------------------------------------
At December 31
-------------------------------------------
2004 2003
-------------------------------------------
OWNED HOTELS
-------------------------------------------
Worldwide
-------------------------------------------
No. of Properties
15 17
-------------------------------------------
No. of Rooms
7,343 7,787
-------------------------------------------
-------------------------------------------
Canada
-------------------------------------------
No. of Properties
7 7
-------------------------------------------
No. of Rooms
3,336 3,268
-------------------------------------------
-------------------------------------------
U.S. and International
-------------------------------------------
No. of Properties
8 10
-------------------------------------------
No. of Rooms
4,007 4,519
-------------------------------------------
-------------------------------------------
FAIRMONT MANAGED
HOTELS
-------------------------------------------
Worldwide
-------------------------------------------
No. of Properties
45 43
-------------------------------------------
No. of Rooms
22,262 21,182
-------------------------------------------
-------------------------------------------
Canada
-------------------------------------------
No. of Properties
21 21
-------------------------------------------
No. of Rooms
10,422 10,361
-------------------------------------------
-------------------------------------------
U.S. and International
-------------------------------------------
No. of Properties
24 22
-------------------------------------------
No. of Rooms
11,840 10,821
-------------------------------------------
-------------------------------------------
DELTA MANAGED HOTELS
-------------------------------------------
Worldwide
-------------------------------------------
No. of Properties
37 39
-------------------------------------------
No. of Rooms
11,038 11,465
-------------------------------------------
-------------------------------------------
Fairmont Hotels & Resorts Inc.
Interim Consolidated Balance Sheets
(Stated in millions of U.S. dollars)
ASSETS
December 31 December 31
2004 2003
------------ ------------
(Unaudited)
Current assets
Cash and cash equivalents
$ 99 $
32
Accounts receivable
90 64
Inventory
16 14
Prepaid expenses and other
11 25
------------ ------------
216 135
Investments in partnerships and corporations
(note 6)
92 53
Investment in Legacy Hotels Real Estate
Investment Trust (note 4)
70 106
Non-hotel real estate
100 95
Property and equipment (note 3)
1,436 1,656
Goodwill
164 132
Intangible assets (note 6)
243 217
Other assets and deferred charges (note
6)
82 109
------------ ------------
$ 2,403 $ 2,503
------------ ------------
------------ ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable and accrued
liabilities $
124 $ 121
Taxes Payable
35 22
Dividends payable
5 3
Current portion of long-term
debt (note 7)
4 118
------------ ------------
168 264
Long-term debt (notes 3 and 5)
398 540
Other liabilities
96 91
Future income taxes
91 62
------------ ------------
753 957
------------ ------------
Shareholders' Equity (note 8)
1,650 1,546
------------ ------------
$ 2,403 $ 2,503
------------ ------------
------------ ------------
Fairmont Hotels & Resorts Inc.
Interim Consolidated Statements of Income
(Stated in millions
of U.S. dollars, except per share amounts)
Three months ended
Year ended
December 31
December 31
2004 2003
2004 2003
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited)
Revenues
Hotel ownership
operations
$ 138 $ 122
$ 654 $ 585
Management operations
13 10
46 38
Real estate activities
5 5
31 36
----------- ----------- ----------- -----------
156 137
731 659
Other revenues from
managed and franchised
properties
12 9
40 33
----------- ----------- ----------- -----------
168 146
771 692
Expenses
Hotel ownership
operations
111 104
475 449
Management operations
6 5
19 16
Real estate activities
7 8
25 26
General and
administrative
9 4
30 17
----------- ----------- ----------- -----------
133 121
549 508
Other expenses from
managed and franchised
properties
12 11
41 35
----------- ----------- ----------- -----------
145 132
590 543
Loss from equity
investments and other
(2) (4)
- (7)
----------- ----------- ----------- -----------
Operating income before
undernoted items
21 10
181 142
Amortization
20 17
74 67
Other expenses, net
- 2
- 2
Interest expense, net
7 11
33 34
(Gain) loss on sales of
investments and hotel
assets (notes 3 and 4)
1 -
(144) -
----------- ----------- ----------- -----------
Income (loss) before
income tax expense
(7) (20)
218 39
----------- ----------- ----------- -----------
Income tax expense
(recovery)
Current
4 4
54 12
Future
(7) (10)
8 (24)
----------- ----------- ----------- -----------
(3) (6)
62 (12)
----------- ----------- ----------- -----------
Net income (loss)
$ (4) $ (14)
$ 156 $
51
----------- ----------- ----------- -----------
Weighted average number of
common shares outstanding
(in millions) (note 8)
Basic
77 79
78 79
Diluted
78 79
79 80
Basic earnings (loss)
per common share
$ (0.06) $ (0.17) $
1.99 $ 0.64
Diluted earnings (loss)
per common share
$ (0.06) $ (0.17) $
1.97 $ 0.63
Fairmont Hotels & Resorts Inc.
Interim Consolidated Statements of Cash Flows
(Stated in millions of U.S. dollars)
Three months ended
Year ended
December 31
December 31
2004 2003
2004 2003
----------- ----------- ----------- -----------
Cash provided by
(Unaudited) (Unaudited) (Unaudited)
(used in)
Operating activities
Net Income (loss)
$ (4) $ (14)
$ 156 $
51
Items not affecting cash
Amortization of property
and equipment
19 16
71 64
Amortization of
intangible assets
1 1
3 3
Loss from equity
investments and
other 2
4 -
7
Future income taxes
(7) (10)
8 (24)
Unrealized foreign
exchange gain
(17) -
(20) -
(Gain) loss on sales
of investments and
hotel assets
1 -
(144) -
Other
1 (1)
9 (12)
Distributions from
investments
3 2
7 7
Changes in non-hotel
real estate
2 6
2 13
Changes in non-cash working
capital items (note 9)
(34) 19
(18) -
----------- ----------- ----------- -----------
(33) 23
74 109
----------- ----------- ----------- -----------
Investing activities
Additions to property
and equipment
(19) (32)
(77) (87)
Acquisitions, net of cash
acquired
- -
- 6
Investments in partnerships
and corporations
(30) (1)
(35) (2)
Sales of investments and
hotel assets
(1) -
443 -
Collection of loans
receivable
15 7
24 7
Issuance of loans
receivable
- (3)
(7) (31)
Investments in intangible
assets
(3) -
(3) -
----------- ----------- ----------- -----------
(38) (29)
345 (107)
----------- ----------- ----------- -----------
Financing activities
Issuance of long-term debt
33 1
116 163
Repayment of long-term
debt
(1) (273)
(381) (424)
Net proceeds from issuance
of convertible notes
- 263
- 263
Proceeds from exercise
of stock options
2 1
3 1
Repurchase of common shares
(33) -
(85) (17)
Dividends paid
- -
(6) (5)
----------- ----------- ----------- -----------
1 (8)
(353) (19)
----------- ----------- ----------- -----------
Effect of exchange rate
changes on cash
1 (3)
1 -
----------- ----------- ----------- -----------
Increase (decrease)
in cash
(69) (17)
67 (17)
Cash and cash equivalents
- beginning of period
168 49
32 49
----------- ----------- ----------- -----------
Cash and cash equivalents
- end of period
$ 99 $
32 $ 99 $
32
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Fairmont Hotels & Resorts Inc.
Interim Consolidated Statements of Retained Earnings
(Stated in millions of U.S. dollars)
Three months ended
Year ended
December 31
December 31
2004 2003
2004 2003
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited)
Balance - Beginning
of period
$ 215 $
95 $ 78 $
39
Net income (loss)
(4) (14)
156 51
----------- ----------- ----------- -----------
211 81
234 90
Repurchase of common
shares (note 8)
(17) -
(37) (6)
Dividends
(5) (3)
(8) (6)
----------- ----------- ----------- -----------
Balance - End of period
$ 189 $
78 $ 189 $
78
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Fairmont Hotels & Resorts Inc.
Notes to Interim Consolidated Financial Statements
(Stated in millions of U.S. dollars)
(Unaudited)
1. Fairmont Hotels & Resorts
Inc. ("FHR" or the "Company") has operated
and owned
hotels and resorts for over 116 years and currently manages
properties
principally under the Fairmont and Delta brands. At
December 31,
2004, FHR managed or franchised 83 luxury and
first-class
hotels. FHR owns Fairmont Hotels Inc. ("Fairmont"), which
at December
31, 2004, managed 45 properties in major city centers and
key resort
destinations throughout Canada, the United States, Mexico,
Bermuda, Barbados,
Europe and the United Arab Emirates. Delta Hotels
Limited ("Delta"),
a wholly owned subsidiary of FHR, managed or
franchised
37 Canadian hotels and resorts at December 31, 2004.
In addition
to hotel and resort management, as at December 31 2004,
FHR had hotel
ownership interests ranging from approximately 15% to
100% in 23
properties, located in Canada, the United States, Mexico,
Bermuda, Barbados,
Europe and the United Arab Emirates. FHR also has
an approximate
24% equity interest in Legacy Hotels Real Estate
Investment
Trust ("Legacy"), which owns 24 hotels and resorts across
Canada and
the United States. FHR also owns real estate properties
that are suitable
for either commercial or residential development,
and has a
vacation ownership product.
Results for
the three months ended December 31, 2004 are not
necessarily
indicative of the results that may be expected for a full
year due to
seasonal and short-term variations. Revenues are
typically
higher in the second and third quarters versus the first
and fourth
quarters of the year.
2. These interim consolidated
financial statements do not include all
disclosures
as required by Canadian generally accepted accounting
principles
("GAAP") for annual consolidated financial statements and
should be
read in conjunction with the audited consolidated financial
statements
for the year ended December 31, 2003 presented in the
annual report.
The accounting policies used in the preparation of
these interim
consolidated financial statements are consistent with
the accounting
policies used in the December 31, 2003 audited
consolidated
financial statements, except as discussed below.
Hedging Relationships
Effective
January 1, 2004, FHR implemented new guidance on accounting
for hedging
relationships. The new guidelines specify the
circumstances
in which hedge accounting is appropriate, including the
identification,
documentation, designation and effectiveness of
hedges and
also the discontinuance of hedge accounting. The adoption
of this accounting
guidance did not have an impact on the Company's
financial
statements.
Generally Accepted
Accounting Principles and General Standards of
Financial
Statement Presentation
Effective
January 1, 2004 the Company adopted the Canadian Institute
of Chartered
Accountants Handbook section 1100, "Generally Accepted
Accounting
Principles". The section provides guidance on sources to
consult when
selecting accounting policies and determining
appropriate
disclosures when a matter is not dealt with explicitly in
the primary
sources of GAAP. No changes to accounting principles or
financial
statement presentation were required.
3. On July 15, 2004, FHR finalized
the sale of The Fairmont Kea Lani
Maui for cash
proceeds of $355. The mortgage of $120 on this property
was repaid.
FHR recognized a gain on the sale of approximately $68,
net of income
taxes of $41. The resort will be managed by Fairmont
under a long-term
management contract.
On July 9,
2004, FHR finalized the sale of The Fairmont Glitter Bay
for cash proceeds
of approximately $32. The mortgage of $5 on this
property was
repaid. FHR recognized a non-taxable gain on the sale of
$8. The resort
will be managed by Fairmont under a long-term
management
contract.
4. On September 13, 2004, FHR
sold 12,000,000 units of Legacy for
approximately
$63 in cash and recognized a gain of $28. The sale
decreases
FHR's investment in Legacy to 23.7% from approximately 35%.
5. In March 2004, FHR entered
into a new $400 unsecured credit facility
due March
2007. The interest rate is floating and is calculated based
on the borrower's
choice of prime rate, bankers acceptance or LIBOR
plus a spread.
6. In April 2004, FHR finalized
an agreement to invest $16 for a 14.5%
interest in
The Fairmont Dubai. This investment is accounted for
using the
equity method due to significant influence obtained through
various contractual
arrangements. Upon finalization of this
agreement,
$23 was moved from "Other assets and deferred charges",
$16 to "Investments
in partnerships and corporations" and $7 to
"Intangible
assets". The resort is managed by Fairmont under a
long-term
management contract.
In December
2004, FHR invested $20 in cash for a 25% interest in a
partnership
with Kingdom Hotels and the Bank of Scotland. The joint
venture, FHR
European Ventures LLP, purchased the Monte Carlo Grand
Hotel in Monaco
in December 2004. The investment is accounted for
using the
equity method due to significant influence and through
contractual
arrangements. Fairmont will manage the property under a
long-term
management contract. Approximately $6 was allocated to
intangible
assets relating to the management contract.
In December
2004, FHR invested $10 for an approximate 14% equity
interest in
an entity named Nile City for Hotels and Tourism. Nile
City for Hotels
and Tourism retains the investment in a hotel
property that
is being constructed in Cairo, Egypt. The investment is
accounted
for using the equity method due to significant influence
and through
contractual arrangements. The resort will be managed by
Fairmont under
a long-term management contract. Approximately $5 was
allocated
to intangible assets relating to the management contract.
7. In August 2004, FHR purchased
the remaining 16.5% of outstanding
shares of
Fairmont from Maritz, Wolff & Co. for approximately $70 in
cash. FHR
now owns 100% of Fairmont. The company had already been
consolidating
100% of Fairmont, by previously having recorded an
obligation
of $69 representing the minimum amount a minority
shareholder
was entitled to receive under a put option. During the
third quarter,
FHR increased its previously reported goodwill and
future income
tax balances by $17. As a result of this transaction,
current portion
of long-term debt decreased by $69.
8. Shareholders' equity
December 31, December 31,
2004 2003
------------ ------------
Common shares
$ 1,164 $ 1,202
Other equity
19 19
Treasury stock
(6) -
Contributed
surplus
142 142
Foreign currency
translation adjustments
142 105
Retained earnings
189 78
------------ ------------
$ 1,650 $ 1,546
------------ ------------
The diluted
weighted-average number of common shares outstanding is
calculated
as follows:
Three months ended Year ended
December 31 December 31
2004 2003 2004
2003
-------- -------- -------- --------
(in millions) (in millions)
Weighted-average
number of
common
shares outstanding
- basic
77 79
78 79
Stock options
1 -
1 1
-------- -------- -------- --------
Weighted-average
number of
common
shares outstanding
- diluted
78 79
79 80
-------- -------- -------- --------
Effective October
24, 2004, FHR may repurchase for cancellation up to
10% of its
outstanding common shares. The amounts and timing of
repurchases
are at FHR's discretion. During the twelve months ended
December 31,
2004, under the current and previous normal course
issuer bid,
FHR repurchased 3,024,600 shares (1,078,300 during the
fourth quarter).
Total consideration relating to the repurchase
amounted to
$85 ($33 for the fourth quarter), of which $42 was
charged to
common shares, $37 was charged to retained earnings, and
$6 to treasury
stock. Of the 1,078,300 shares, 166,100 shares were
classified
as treasury stock as they were repurchased prior to
December 31,
2004 and cancelled in January 2005. During the twelve
months ended
December 31, 2004, FHR issued 149,970 shares (101,031
shares for
the fourth quarter) pursuant to the Key Employee Stock
Option Plan
of which $3 was credited to common shares ($2 for the
fourth quarter)
for proceeds from options exercised. In the fourth
quarter, 4,399
shares were cancelled relating to a plan of
arrangement.
Securityholders were given six years from the effective
date of the
arrangement (October 13, 1998) to claim these shares. At
December 31,
2004, 76,393,348 common shares were outstanding (2003 -
79,106,277).
During the
twelve months ended December 31, 2004, 10,000 stock
options were
granted (nil in the fourth quarter). Assuming FHR
elected to
recognize the cost of its stock-based compensation based
on the estimated
fair value of stock options granted after January 1,
2002 but before
January 1, 2003, net income and basic and diluted
earnings per
share would have been:
Three months ended Year ended
December 31 December 31
2004 2003 2004
2003
-------- -------- -------- --------
Reported net
income
$ (4) $ (14) $ 156
$ 51
Net income
assuming fair
value
method used
$ (4) $ (14) $ 155
$ 50
Basic earnings
per share $ (0.06) $ (0.17)
$ 1.98 $ 0.64
Diluted earnings
per share $ (0.06) $ (0.17) $
1.96 $ 0.63
9. Changes in non-cash working
capital:
Three months ended Year ended
December 31 December 31
2004 2003 2004
2003
-------- -------- -------- --------
Decrease (increase)
in
current
assets
Accounts receivable
$ 8 $ 3
$ (23) $ 4
Inventory
- -
(1) -
Prepaid expenses
and other 5
5 4
4
Increase (decrease)
in
current
liabilities
Accounts payable
and
accrued
liabilities
(1) 8
(1) (9)
Taxes payable
(46) 3
3 1
-------- -------- -------- --------
$ (34) $ 19 $
(18) $ -
-------- -------- -------- --------
10. Segmented Information
FHR has five
reportable operating segments in two core business
activities,
ownership and management operations. The segments are
hotel ownership,
investment in Legacy, real estate activities,
Fairmont and
Delta. Hotel ownership consists of real estate interests
ranging from
approximately 15% to 100% in 23 properties. The
investment
in Legacy consists of an approximate 24% equity interest
in Legacy,
which owns 24 hotels and resorts across Canada and the
United States.
Real estate activities consists primarily of two
undeveloped
land blocks in Toronto and Vancouver and a vacation
ownership
product. Fairmont is a North American luxury hotel and
resort management
company and Delta is a Canadian first-class hotel
and resort
management company.
The performance
of all segments is evaluated by management primarily
on earnings
before interest, taxes and amortization ("EBITDA"), which
is defined
as income before interest, income taxes, amortization,
gain on sales
of investments and hotel assets, and other (income)
expenses,
net. EBITDA includes income from investments and other.
Amortization,
interest and income taxes are not allocated to the
individual
segments. All transactions among operating segments are
conducted
at fair market value.
The following
tables present revenues, EBITDA, total assets and
capital expenditures
for FHR's reportable segments:
Three months ended December 31, 2004
------------------------------------------------------
Ownership
Management
-------------------------------- ---------------------
Hotel
Real estate
Ownership Legacy activities Fairmont
Delta
---------- ---------- ---------- ---------- ----------
Operating revenues $
138 $ - $
5 $ 14 $
3
Other revenues from
managed and
franchised
properties
- -
- 9
3
Income (loss) from
equity investments
and other
- (2)
- -
-
EBITDA(b)
23 (2)
(2) 9
2
Total assets(c)
1,604 70
103 920
79
Capital expenditures
18 -
- 1
-
Three months ended
December 31, 2004
--------------------------------
Corporate Inter-
general segment
and adminis- elimi-
trative nation(a) Total
---------- ---------- ----------
Operating revenues $
- $ (4) $ 156
Other revenues from
managed and
franchised
properties
- -
12
----------
168
Income (loss) from
equity investments
and other
- -
(2)
EBITDA(b)
(9) -
21
Total assets(c)
- (373) 2,403
Capital expenditures
- 19
Three months ended December 31, 2003
------------------------------------------------------
Ownership
Management
-------------------------------- ---------------------
Hotel
Real estate
Ownership Legacy activities Fairmont
Delta
---------- ---------- ---------- ---------- ----------
Operating revenues $
122 $ - $
5 $ 11 $
3
Other revenues from
managed and
franchised
properties
- -
- 7
2
Income (loss) from
equity investments
and other
- (4)
- -
-
EBITDA(b)
14 (4)
(3) 7
2
Total assets(c)
1,916 106
102 351
76
Capital expenditures
30 -
- 2
-
Three months ended
December 31, 2003
--------------------------------
Corporate Inter-
general segment
and adminis- elimi-
trative nation(a) Total
---------- ---------- ----------
Operating revenues $
- $ (4) $ 137
Other revenues from
managed and
franchised
properties
- -
9
----------
146
Income (loss) from
equity investments
and other
- -
(4)
EBITDA(b)
(4) (2)
10
Total assets(c)
- (48)
2,503
Capital expenditures
- -
32
Year ended December 31, 2004
------------------------------------------------------
Ownership
Management
-------------------------------- ---------------------
Hotel
Real estate
Ownership Legacy activities Fairmont
Delta
---------- ---------- ---------- ---------- ----------
Operating revenues $
654 $ - $
31 $ 54 $
13
Other revenues from
managed and
franchised
properties
- -
- 30
10
Income (loss) from
equity investments
and other
2 (2)
- -
-
EBITDA(b)
160 (2)
6 40
8
Total assets(c)
1,604 70
103 920
79
Capital expenditures
73 -
- 4
-
Year ended
December 31, 2004
--------------------------------
Corporate Inter-
general segment
and adminis- elimi-
trative nation(a) Total
---------- ---------- ----------
Operating revenues $
- $ (21) $ 731
Other revenues from
managed and
franchised
properties
- -
40
----------
771
Income (loss) from
equity investments
and other
- -
-
EBITDA(b)
(30) (1)
181
Total assets(c)
- (373) 2,403
Capital expenditures
- -
77
Year ended December 31, 2003
------------------------------------------------------
Ownership
Management
-------------------------------- ---------------------
Hotel
Real estate
Ownership Legacy activities Fairmont
Delta
---------- ---------- ---------- ---------- ----------
Operating revenues $
585 $ - $
36 $ 44 $
12
Other revenues from
managed and
franchised
properties
- -
- 25
8
Income (loss) from
equity investments
and other
2 (9)
- -
-
EBITDA(b)
120 (9)
10 31
9
Total assets(c)
1,916 106
102 351
76
Capital expenditures
84 -
- 3
-
Year ended
December 31, 2003
--------------------------------
Corporate Inter-
general segment
and adminis- elimi-
trative nation(a) Total
---------- ---------- ----------
Operating revenues $
- $ (18) $ 659
Other revenues from
managed and
franchised
properties
- -
33
----------
692
Income (loss) from
equity investments
and other
- -
(7)
EBITDA(b)
(17) (2)
142
Total assets(c)
- (48)
2,503
Capital expenditures
- -
87
(a) Operating
revenues include management fees that are charged by
Fairmont of $4 (2003 - $4) and $21 (2003 - $18) for the three
months and year ended December 31, 2004 respectively, and Delta
of $0.1 (2003 - $0.1) and $0.4 (2003 - $0.3) for the three months
and year ended December 31, 2004 respectively, to the hotel
ownership operations, which are eliminated on consolidation.
EBITDA includes expenses not reimbursed relating to marketing and
reservation services performed by FHR under the terms of its
hotel management and franchise agreements. Total assets have been
reduced for the the elimination of inter-segment loans net of
corporate assets.
(b) A reconciliation
of EBITDA to net income (loss) is as follows:
Three months ended Twelve months ended
December 31 December 31
2004 2003 2004
2003
--------- --------- --------- ---------
EBITDA
$ 21 $ 10 $
181 $ 142
Amortization
20 17
74 67
Interest expense,
net
7 11
33 34
(Gain) loss
on sales of
investments
and hotel assets 1
- (144)
-
Other (income)
expenses, net -
2 -
2
Income tax
expense (recovery) (3)
(6) 62
(12)
--------- --------- --------- ---------
Net income
(loss)
$ (4) $ (14) $
156 $ 51
--------- --------- --------- ---------
(c) Hotel ownership
assets include $90 (2003 - $49) of investments
accounted for using the equity method.
11. The Company's hotel ownership revenues
are as follows:
Three months ended Twelve months ended
December 31 December 31
2004 2003 2004
2003
--------- --------- --------- ---------
Rooms revenue
$ 69 $ 66 $
356 $ 324
Food and beverage
revenue 51
40 215
183
Other
18 16
83 78
--------- --------- --------- ---------
$ 138 $ 122 $
654 $ 585
--------- --------- --------- ---------
12. As required under the terms and
conditions of the 3.75% convertible
senior notes
due 2023, the debt and the common shares issuable upon
conversion
of the shares were registered under a Form F-10
Registration
Statement with the United States Securities and Exchange
Commission
on April 6, 2004.
13. At December 31, 2004, FHR has a
payable to Legacy of $4 in connection
with various
management contracts, and reciprocal loan agreements
with Legacy
for $87.
A subsidiary
of FHR had a 25% participation in the first mortgage on
The Fairmont
Olympic Hotel, Seattle amounting to approximately $11
that was fully
paid in the fourth quarter.
14. FHR recorded pension and other
post employment benefit expenses as
follows:
Three months ended Year ended
December 31 December 31
2004 2003 2004
2003
--------- --------- --------- ---------
(in millions) (in millions)
Pension
$ (1) $ 3 $
- $ 5
Other post-employment
benefits
$ - $
1 $ 1 $
1
--------- --------- --------- ---------
$ (1) $ 4 $
1 $ 6
--------- --------- --------- ---------
15. Certain of the prior period figures
have been reclassified to conform
with the presentation
adopted for 2004. |
