The annual report summarizes Host Marriott Corporation's performance in 2002. It states that while 2002 was a challenging time for the lodging industry due to economic conditions, Host Marriott was able to renegotiate management agreements for 90% of its portfolio, maintain over $360 million in cash reserves, purchase the Boston Marriott Copley Place hotel at a discount, streamline its business by selling interests in partnerships, and maintain its portfolio's revenue per available room premium over competitors. However, key financial figures such as earnings, EBITDA, and revenue per available room declined compared to 2001 due to the difficult operating environment.
- HCA is one of the largest healthcare services companies in the US, operating 184 hospitals across 23 states, England, and Switzerland as of 2001.
- In 2001, HCA invested $1.4 billion in capital expenditures, with plans to invest $1.6 billion in 2002 and $1.8 billion in 2003 primarily to expand capacity, improve access, and upgrade infrastructure like emergency departments.
- Population growth in Sunbelt regions where many HCA hospitals operate is driving increased demand for healthcare services, along with new technologies and an aging population requiring more care.
Danaher reported record results for the fourth quarter and full year of 2006. Net earnings for Q4 2006 increased 28.5% to $323.7 million compared to Q4 2005. For the full year, net earnings increased 25% to $1.122 billion compared to 2005. Sales for Q4 2006 increased 17.5% to $2.66 billion and increased 20% for the full year to $9.596 billion. Danaher also expanded its segment reporting to include Medical Technologies as its own segment.
The document is McGraw-Hill's 2008 annual report which discusses the financial challenges faced by the company that year due to the global recession. It summarizes that revenue declined 6.2% to $6.4 billion while net income fell 21.1% to $799.5 million. However, the company remained profitable and had a strong balance sheet which positioned it well to weather the economic storm. The report discusses questions around what caused the financial crisis, the role of credit ratings, and trends that will shape future capital markets and opportunities.
1) The McGraw-Hill Companies achieved record financial results in 2007, with revenue growing 8.3% to $6.8 billion and net income rising 14.9% to $1 billion, however challenges emerged as the US housing bubble burst.
2) The company remains focused on providing high-quality information and insights to help customers succeed, while generating superior shareholder value through consistent earnings growth and returning $2.5 billion to shareholders in 2007.
3) While the current market turmoil is difficult to predict, the long-term prospects for the company's markets remain strong due to enduring global trends of needing capital, knowledge, and transparent business information.
Danaher Corporation reported record results for the fourth quarter and full year 2005. Net earnings for Q4 2005 increased 20% to $261.6 million compared to Q4 2004. For the full year, net earnings increased 21.5% to $907.7 million compared to 2004. Sales for Q4 2005 increased 14.5% and sales for 2005 increased 16% compared to the prior year. The company's president stated that the record performance throughout 2005 and strong fourth quarter give them confidence for continued excellent results in 2006.
PricewaterhouseCoopers conducted an audit of The Progressive Corporation and subsidiaries' financial statements for 2003, 2002, and 2001. PwC issued an unqualified opinion, stating that the financial statements fairly presented the financial position and results of operations in accordance with generally accepted accounting principles. The audit was performed in accordance with generally accepted auditing standards, which included examining evidence supporting the financial statements and evaluating the overall presentation.
Danaher Corporation reported financial results for Q4 and full year 2008. Q4 net earnings were $305.7 million compared to $320.2 million in Q4 2007. For the full year, net earnings were $1.3 billion compared to $1.37 billion in 2007. Sales increased 1% in Q4 to $3.18 billion and increased 15% for the full year to $12.7 billion. The CEO stated that while 2009 will be difficult, Danaher's portfolio of businesses and strong balance sheet will allow it to outperform in a challenging market.
This document is Illinois Tool Works Inc.'s quarterly report filed with the SEC for the quarter ended June 30, 2005. It includes Illinois Tool Works' statement of income, statement of financial position, and statement of cash flows for the quarter, as well as notes about stock-based compensation. Key details include that net income for the quarter was $373.8 million, total assets as of June 30, 2005 were $11.6 billion, and stock-based compensation expense recognized for the quarter was $9 million for restricted stock and $11.2 million on a pro forma basis.
- HCA is one of the largest healthcare services companies in the US, operating 184 hospitals across 23 states, England, and Switzerland as of 2001.
- In 2001, HCA invested $1.4 billion in capital expenditures, with plans to invest $1.6 billion in 2002 and $1.8 billion in 2003 primarily to expand capacity, improve access, and upgrade infrastructure like emergency departments.
- Population growth in Sunbelt regions where many HCA hospitals operate is driving increased demand for healthcare services, along with new technologies and an aging population requiring more care.
Danaher reported record results for the fourth quarter and full year of 2006. Net earnings for Q4 2006 increased 28.5% to $323.7 million compared to Q4 2005. For the full year, net earnings increased 25% to $1.122 billion compared to 2005. Sales for Q4 2006 increased 17.5% to $2.66 billion and increased 20% for the full year to $9.596 billion. Danaher also expanded its segment reporting to include Medical Technologies as its own segment.
The document is McGraw-Hill's 2008 annual report which discusses the financial challenges faced by the company that year due to the global recession. It summarizes that revenue declined 6.2% to $6.4 billion while net income fell 21.1% to $799.5 million. However, the company remained profitable and had a strong balance sheet which positioned it well to weather the economic storm. The report discusses questions around what caused the financial crisis, the role of credit ratings, and trends that will shape future capital markets and opportunities.
1) The McGraw-Hill Companies achieved record financial results in 2007, with revenue growing 8.3% to $6.8 billion and net income rising 14.9% to $1 billion, however challenges emerged as the US housing bubble burst.
2) The company remains focused on providing high-quality information and insights to help customers succeed, while generating superior shareholder value through consistent earnings growth and returning $2.5 billion to shareholders in 2007.
3) While the current market turmoil is difficult to predict, the long-term prospects for the company's markets remain strong due to enduring global trends of needing capital, knowledge, and transparent business information.
Danaher Corporation reported record results for the fourth quarter and full year 2005. Net earnings for Q4 2005 increased 20% to $261.6 million compared to Q4 2004. For the full year, net earnings increased 21.5% to $907.7 million compared to 2004. Sales for Q4 2005 increased 14.5% and sales for 2005 increased 16% compared to the prior year. The company's president stated that the record performance throughout 2005 and strong fourth quarter give them confidence for continued excellent results in 2006.
PricewaterhouseCoopers conducted an audit of The Progressive Corporation and subsidiaries' financial statements for 2003, 2002, and 2001. PwC issued an unqualified opinion, stating that the financial statements fairly presented the financial position and results of operations in accordance with generally accepted accounting principles. The audit was performed in accordance with generally accepted auditing standards, which included examining evidence supporting the financial statements and evaluating the overall presentation.
Danaher Corporation reported financial results for Q4 and full year 2008. Q4 net earnings were $305.7 million compared to $320.2 million in Q4 2007. For the full year, net earnings were $1.3 billion compared to $1.37 billion in 2007. Sales increased 1% in Q4 to $3.18 billion and increased 15% for the full year to $12.7 billion. The CEO stated that while 2009 will be difficult, Danaher's portfolio of businesses and strong balance sheet will allow it to outperform in a challenging market.
This document is Illinois Tool Works Inc.'s quarterly report filed with the SEC for the quarter ended June 30, 2005. It includes Illinois Tool Works' statement of income, statement of financial position, and statement of cash flows for the quarter, as well as notes about stock-based compensation. Key details include that net income for the quarter was $373.8 million, total assets as of June 30, 2005 were $11.6 billion, and stock-based compensation expense recognized for the quarter was $9 million for restricted stock and $11.2 million on a pro forma basis.
This document contains financial statements and key metrics for Ryder System, Inc. for the second quarter and first half of 2007 compared to the same periods in 2006. It shows that total revenue increased 4% to $1.658 billion in the second quarter, with operating revenue also up 4% to $1.157 billion. For the first half, total revenue rose 5% to $3.252 billion and operating revenue increased 5% to $2.276 billion. The Fleet Management Solutions segment saw revenue remain flat at $1.037 billion in the second quarter, while Supply Chain Solutions revenue increased 16% and Dedicated Contract Carriage declined slightly.
The document is Coventry Healthcare's 2006 Annual Report. It discusses Coventry's business strategy and financial performance in 2006. Key points include:
- Coventry organized its business into three divisions - Commercial, Individual/Government, and Specialty - to capitalize on growth opportunities.
- The Commercial division continued strong growth while maintaining industry-leading margins.
- The Individual/Government division saw significant growth from the new Medicare Part D program and expanding Medicaid and individual businesses.
- All divisions performed well financially in 2006, with revenues reaching a record $7.7 billion and earnings continuing to grow.
Danaher Corporation reported financial results for the fourth quarter and full year of 2007. Net earnings for Q4 2007 were $320 million, or $0.97 per diluted share. For the full year 2007, net earnings were $1.37 billion, or $4.19 per diluted share. Sales for Q4 2007 were $3.14 billion, a 19.5% increase over Q4 2006. For the full year 2007, sales were $11.03 billion, a 16.5% increase over 2006. The company's president stated they were pleased with the record results and remain confident in their ability to deliver again in 2008 despite softness in some end markets.
This annual report summarizes the financial statements and performance of China Youth Media, Inc. for the years ending December 31, 2008 and December 31, 2007. Some key details:
- Total assets increased from $911,444 in 2007 to $8,961,778 in 2008 primarily due to an increase in intangible assets.
- Total liabilities increased from $2,496,206 to $3,421,146 over the same period mainly due to increases in convertible notes payable and accrued liabilities.
- Revenue decreased from $592,365 in 2007 to $106,898 in 2008 while total operating expenses declined slightly. This resulted in an operating loss of $2,
Ryder System, Inc. and Subsidiaries reported financial results for the third quarter and first nine months of 2007. Total revenue increased 2% to $1.65 billion for the quarter and increased 4% to $4.90 billion for the nine month period. Net earnings were $65.5 million for the quarter, flat compared to the prior year, and $181.9 million for the nine months, down 1% from the prior year. Fleet Management Solutions revenue decreased 1% for the quarter due to declines in commercial rental and fuel revenue, while Supply Chain Solutions and Dedicated Contract Carriage saw revenue increases.
plains all american pipeline 2006 10-K part2finance13
This document provides an overview of Plains All American Pipeline, L.P.'s financial performance and operations for the year ended December 31, 2006. It discusses the company's three business segments: transportation, facilities, and marketing. The transportation segment generates revenue from tariffs and fees for transporting crude oil and refined products via pipelines. The facilities segment provides storage and processing services for crude oil, refined products and LPG, generating revenue from leases and processing arrangements. The marketing segment purchases and sells crude oil and LPG. The company grew substantially in 2006 through acquisitions, especially in facilities with the Pacific acquisition, leading it to reorganize its reporting segments.
Advanced Micro Devices reported a net loss of $611 million for the first quarter of 2007, with net revenue of $1.233 billion. The Computing Solutions segment experienced an operating loss of $321 million on $918 million in revenue. Research and development expenses were $432 million for the quarter. Adjusted EBITDA, which excludes certain one-time acquisition costs, was a loss of $196 million.
This document is Illinois Tool Works Inc.'s quarterly report filed with the SEC for the quarter ended June 30, 2004. It includes the company's unaudited financial statements, including statements of income, financial position, and cash flows for the quarter and year to date. Key highlights include total revenues of $3 billion for the quarter and $5.7 billion year to date, net income of $360 million for the quarter and $651 million year to date, and total assets of $11.9 billion and stockholders' equity of $8.2 billion as of June 30, 2004.
United Health Group Consolidated Financial Statementsfinance3
UnitedHealth Group reported strong financial results in 2001 with record revenues of $23.5 billion, up 11% from 2000. Net earnings reached a record $913 million, up 30% from 2000. All business segments experienced revenue and earnings growth. The consolidated operating margin increased to 6.7% due to productivity gains and a shift to higher-margin fee-based products. Return on shareholders' equity improved to 24.5% from 19.0% in 2000, demonstrating superior performance.
This document is the 2004 annual report of Gannett Co., Inc. It summarizes the company's strong financial performance in 2004, with record revenues of $7.4 billion, net income of $1.32 billion, and diluted earnings per share of $4.92. The CEO credits these results to the company's strategies of pursuing growth opportunities, delivering news and information across multiple platforms, and investing in people and new technologies. Challenges in 2004 included an uneven economy and restrictive media ownership regulations.
This document is the 2004 annual report of Gannett Co., Inc. It summarizes the company's strong financial performance in 2004, with record revenues of $7.4 billion, net income of $1.32 billion, and diluted earnings per share of $4.92. The CEO credits these results to the company's strategies of pursuing growth opportunities, delivering news and information across multiple platforms, and investing in people and new technologies. Challenges in 2004 included an uneven economy and restrictive media ownership regulations.
This annual report summarizes MGM MIRAGE CityCenter's projects in Las Vegas in 2007. It includes details on six construction projects that were part of CityCenter: ARIA Resort-Casino, Vdara Condo Hotel, Veer Towers, The Harmon Hotel, Spa & Residences, Mandarin Oriental Las Vegas, and The Crystals. It also provides financial highlights for MGM MIRAGE and notes that CityCenter is the largest privately financed project in the United States at 76 acres and 18 million square feet.
The document is MGM MIRAGE's 2007 annual report detailing their CityCenter project in Las Vegas. It describes the various components of CityCenter, including hotels, condo towers, retail space, and financial highlights. Some key points:
- CityCenter is a 76-acre, $18 billion privately funded project, the largest in US history. It includes multiple hotels, condo towers, and retail space designed by renowned architects.
- ARIA is a 61-story, 4,000 room hotel and conference center. Vdara is a 57-story condo-hotel tower with over 1,500 units. Other components include condo towers, hotels, retail space, and entertainment venues.
Schering-Plough is a global pharmaceutical company focused on research and developing new therapies. In 2000, the company achieved 8% sales growth to $9.8 billion, led by its pharmaceutical business. Key therapeutic areas include allergy/respiratory, where sales grew 9% to $4.2 billion, driven by the antihistamine Claritin. The company is working to expand its allergy franchise with new products like Clarinex and strengthen its position in other areas like cancer and inflammation. Research and marketing efforts aim to continue delivering new treatments and driving international expansion.
The document provides explanatory notes on non-GAAP financial information presented by MetLife. It defines various non-GAAP measures used by MetLife to analyze performance, such as operating earnings and operating return on common equity. These measures exclude items like investment gains and losses and discontinued operations to highlight underlying profitability. The document also includes reconciliations of the non-GAAP measures to the most directly comparable GAAP measures for historical periods.
The document discusses Erie Indemnity Company's financial results and strategic initiatives for improving underwriting profitability in 2003. Key points include:
- Net income increased to $199.7 million in 2003 compared to $172.1 million in 2002.
- Direct written premium increased 16.6% to $3.7 billion in 2003.
- The company launched the AWARE initiative to strengthen underwriting practices.
- Catastrophe losses totaled $183 million in 2003.
- Rate increases approved for 2004 will add $254 million in additional premium.
This document is Host Marriott Corporation's 2004 Annual Report. It summarizes the company's financial highlights for 2004 including revenues, operating profit, net income, funds from operations per share, stock price and hotel operating data. It also provides an overview of the company's strategy to be the premier hospitality real estate company through owning high-quality lodging assets in prime locations.
Symantec's 2003 annual report summarizes the company's strong financial performance in fiscal year 2003. Revenues grew 31% to $1.4 billion, operating income grew to $342 million, and net income grew to $248 million. The company saw growth across all regions and segments, with the consumer segment growing 52% and accounting for 41% of revenues. Symantec continued investing in its business through acquisitions and investments in sales, marketing, and product development to maintain its leadership position in the internet security market.
The consolidated net income of Petrobras and its subsidiaries for 2006 was R$25.919 billion, a 9% increase over 2005. This was mainly due to a R$4.076 billion increase in gross profit from higher sales volumes and oil prices in Brazil and abroad. However, this was partially offset by higher expenses including write-offs of abandoned wells abroad, increased sales and administrative expenses, taxes, research and development costs, and other operating costs.
Petrobras reported consolidated net income of R$ 25.9 billion in 2006, a 9% increase over 2005. Higher oil prices and sales volumes contributed to increased gross profits. Exploration costs decreased due to fewer dry wells. However, operating expenses also increased, driven by wages, taxes, and technological research costs. Overall, improved financial results and a tax benefit led to higher net income despite cost pressures. Income varied across business segments, with Exploration and Production up 8% and Supply up 10%, while Distribution was flat.
United Health Group UnitedHealth Group Financial Reviewfinance3
UnitedHealth Group reported strong financial results in 2003 with revenues increasing 15% to $28.8 billion and earnings from operations growing 34% to $2.9 billion. Net earnings grew 35% to $1.8 billion resulting in diluted EPS of $2.96. The results were driven by revenue growth across all business segments, improved margins on risk-based products, and a shift toward higher-margin fee-based services. Looking ahead, the company expects continued growth from increasing premium rates, expanding into new geographies and services, and pursuing additional acquisitions.
The document is HCA's 2002 annual report. It summarizes that 2002 was a successful year for HCA financially and in resolving investigations by the federal government. HCA reinvested $1.7 billion in its existing facilities and acquired additional hospitals. It also initiated several long-term programs to develop its workforce, such as scholarships through HCA Cares and military training through Army PaYS, to address the national nursing shortage. The CEO and COO were pleased with progress in 2002, their first full year in their roles, and committed to continued investment in facilities, technology, and employees.
This document contains financial statements and key metrics for Ryder System, Inc. for the second quarter and first half of 2007 compared to the same periods in 2006. It shows that total revenue increased 4% to $1.658 billion in the second quarter, with operating revenue also up 4% to $1.157 billion. For the first half, total revenue rose 5% to $3.252 billion and operating revenue increased 5% to $2.276 billion. The Fleet Management Solutions segment saw revenue remain flat at $1.037 billion in the second quarter, while Supply Chain Solutions revenue increased 16% and Dedicated Contract Carriage declined slightly.
The document is Coventry Healthcare's 2006 Annual Report. It discusses Coventry's business strategy and financial performance in 2006. Key points include:
- Coventry organized its business into three divisions - Commercial, Individual/Government, and Specialty - to capitalize on growth opportunities.
- The Commercial division continued strong growth while maintaining industry-leading margins.
- The Individual/Government division saw significant growth from the new Medicare Part D program and expanding Medicaid and individual businesses.
- All divisions performed well financially in 2006, with revenues reaching a record $7.7 billion and earnings continuing to grow.
Danaher Corporation reported financial results for the fourth quarter and full year of 2007. Net earnings for Q4 2007 were $320 million, or $0.97 per diluted share. For the full year 2007, net earnings were $1.37 billion, or $4.19 per diluted share. Sales for Q4 2007 were $3.14 billion, a 19.5% increase over Q4 2006. For the full year 2007, sales were $11.03 billion, a 16.5% increase over 2006. The company's president stated they were pleased with the record results and remain confident in their ability to deliver again in 2008 despite softness in some end markets.
This annual report summarizes the financial statements and performance of China Youth Media, Inc. for the years ending December 31, 2008 and December 31, 2007. Some key details:
- Total assets increased from $911,444 in 2007 to $8,961,778 in 2008 primarily due to an increase in intangible assets.
- Total liabilities increased from $2,496,206 to $3,421,146 over the same period mainly due to increases in convertible notes payable and accrued liabilities.
- Revenue decreased from $592,365 in 2007 to $106,898 in 2008 while total operating expenses declined slightly. This resulted in an operating loss of $2,
Ryder System, Inc. and Subsidiaries reported financial results for the third quarter and first nine months of 2007. Total revenue increased 2% to $1.65 billion for the quarter and increased 4% to $4.90 billion for the nine month period. Net earnings were $65.5 million for the quarter, flat compared to the prior year, and $181.9 million for the nine months, down 1% from the prior year. Fleet Management Solutions revenue decreased 1% for the quarter due to declines in commercial rental and fuel revenue, while Supply Chain Solutions and Dedicated Contract Carriage saw revenue increases.
plains all american pipeline 2006 10-K part2finance13
This document provides an overview of Plains All American Pipeline, L.P.'s financial performance and operations for the year ended December 31, 2006. It discusses the company's three business segments: transportation, facilities, and marketing. The transportation segment generates revenue from tariffs and fees for transporting crude oil and refined products via pipelines. The facilities segment provides storage and processing services for crude oil, refined products and LPG, generating revenue from leases and processing arrangements. The marketing segment purchases and sells crude oil and LPG. The company grew substantially in 2006 through acquisitions, especially in facilities with the Pacific acquisition, leading it to reorganize its reporting segments.
Advanced Micro Devices reported a net loss of $611 million for the first quarter of 2007, with net revenue of $1.233 billion. The Computing Solutions segment experienced an operating loss of $321 million on $918 million in revenue. Research and development expenses were $432 million for the quarter. Adjusted EBITDA, which excludes certain one-time acquisition costs, was a loss of $196 million.
This document is Illinois Tool Works Inc.'s quarterly report filed with the SEC for the quarter ended June 30, 2004. It includes the company's unaudited financial statements, including statements of income, financial position, and cash flows for the quarter and year to date. Key highlights include total revenues of $3 billion for the quarter and $5.7 billion year to date, net income of $360 million for the quarter and $651 million year to date, and total assets of $11.9 billion and stockholders' equity of $8.2 billion as of June 30, 2004.
United Health Group Consolidated Financial Statementsfinance3
UnitedHealth Group reported strong financial results in 2001 with record revenues of $23.5 billion, up 11% from 2000. Net earnings reached a record $913 million, up 30% from 2000. All business segments experienced revenue and earnings growth. The consolidated operating margin increased to 6.7% due to productivity gains and a shift to higher-margin fee-based products. Return on shareholders' equity improved to 24.5% from 19.0% in 2000, demonstrating superior performance.
This document is the 2004 annual report of Gannett Co., Inc. It summarizes the company's strong financial performance in 2004, with record revenues of $7.4 billion, net income of $1.32 billion, and diluted earnings per share of $4.92. The CEO credits these results to the company's strategies of pursuing growth opportunities, delivering news and information across multiple platforms, and investing in people and new technologies. Challenges in 2004 included an uneven economy and restrictive media ownership regulations.
This document is the 2004 annual report of Gannett Co., Inc. It summarizes the company's strong financial performance in 2004, with record revenues of $7.4 billion, net income of $1.32 billion, and diluted earnings per share of $4.92. The CEO credits these results to the company's strategies of pursuing growth opportunities, delivering news and information across multiple platforms, and investing in people and new technologies. Challenges in 2004 included an uneven economy and restrictive media ownership regulations.
This annual report summarizes MGM MIRAGE CityCenter's projects in Las Vegas in 2007. It includes details on six construction projects that were part of CityCenter: ARIA Resort-Casino, Vdara Condo Hotel, Veer Towers, The Harmon Hotel, Spa & Residences, Mandarin Oriental Las Vegas, and The Crystals. It also provides financial highlights for MGM MIRAGE and notes that CityCenter is the largest privately financed project in the United States at 76 acres and 18 million square feet.
The document is MGM MIRAGE's 2007 annual report detailing their CityCenter project in Las Vegas. It describes the various components of CityCenter, including hotels, condo towers, retail space, and financial highlights. Some key points:
- CityCenter is a 76-acre, $18 billion privately funded project, the largest in US history. It includes multiple hotels, condo towers, and retail space designed by renowned architects.
- ARIA is a 61-story, 4,000 room hotel and conference center. Vdara is a 57-story condo-hotel tower with over 1,500 units. Other components include condo towers, hotels, retail space, and entertainment venues.
Schering-Plough is a global pharmaceutical company focused on research and developing new therapies. In 2000, the company achieved 8% sales growth to $9.8 billion, led by its pharmaceutical business. Key therapeutic areas include allergy/respiratory, where sales grew 9% to $4.2 billion, driven by the antihistamine Claritin. The company is working to expand its allergy franchise with new products like Clarinex and strengthen its position in other areas like cancer and inflammation. Research and marketing efforts aim to continue delivering new treatments and driving international expansion.
The document provides explanatory notes on non-GAAP financial information presented by MetLife. It defines various non-GAAP measures used by MetLife to analyze performance, such as operating earnings and operating return on common equity. These measures exclude items like investment gains and losses and discontinued operations to highlight underlying profitability. The document also includes reconciliations of the non-GAAP measures to the most directly comparable GAAP measures for historical periods.
The document discusses Erie Indemnity Company's financial results and strategic initiatives for improving underwriting profitability in 2003. Key points include:
- Net income increased to $199.7 million in 2003 compared to $172.1 million in 2002.
- Direct written premium increased 16.6% to $3.7 billion in 2003.
- The company launched the AWARE initiative to strengthen underwriting practices.
- Catastrophe losses totaled $183 million in 2003.
- Rate increases approved for 2004 will add $254 million in additional premium.
This document is Host Marriott Corporation's 2004 Annual Report. It summarizes the company's financial highlights for 2004 including revenues, operating profit, net income, funds from operations per share, stock price and hotel operating data. It also provides an overview of the company's strategy to be the premier hospitality real estate company through owning high-quality lodging assets in prime locations.
Symantec's 2003 annual report summarizes the company's strong financial performance in fiscal year 2003. Revenues grew 31% to $1.4 billion, operating income grew to $342 million, and net income grew to $248 million. The company saw growth across all regions and segments, with the consumer segment growing 52% and accounting for 41% of revenues. Symantec continued investing in its business through acquisitions and investments in sales, marketing, and product development to maintain its leadership position in the internet security market.
The consolidated net income of Petrobras and its subsidiaries for 2006 was R$25.919 billion, a 9% increase over 2005. This was mainly due to a R$4.076 billion increase in gross profit from higher sales volumes and oil prices in Brazil and abroad. However, this was partially offset by higher expenses including write-offs of abandoned wells abroad, increased sales and administrative expenses, taxes, research and development costs, and other operating costs.
Petrobras reported consolidated net income of R$ 25.9 billion in 2006, a 9% increase over 2005. Higher oil prices and sales volumes contributed to increased gross profits. Exploration costs decreased due to fewer dry wells. However, operating expenses also increased, driven by wages, taxes, and technological research costs. Overall, improved financial results and a tax benefit led to higher net income despite cost pressures. Income varied across business segments, with Exploration and Production up 8% and Supply up 10%, while Distribution was flat.
United Health Group UnitedHealth Group Financial Reviewfinance3
UnitedHealth Group reported strong financial results in 2003 with revenues increasing 15% to $28.8 billion and earnings from operations growing 34% to $2.9 billion. Net earnings grew 35% to $1.8 billion resulting in diluted EPS of $2.96. The results were driven by revenue growth across all business segments, improved margins on risk-based products, and a shift toward higher-margin fee-based services. Looking ahead, the company expects continued growth from increasing premium rates, expanding into new geographies and services, and pursuing additional acquisitions.
The document is HCA's 2002 annual report. It summarizes that 2002 was a successful year for HCA financially and in resolving investigations by the federal government. HCA reinvested $1.7 billion in its existing facilities and acquired additional hospitals. It also initiated several long-term programs to develop its workforce, such as scholarships through HCA Cares and military training through Army PaYS, to address the national nursing shortage. The CEO and COO were pleased with progress in 2002, their first full year in their roles, and committed to continued investment in facilities, technology, and employees.
United Health Group [PDF Document] UnitedHealth Group Financial Reviewfinance3
This document provides an overview of UnitedHealth Group's financial performance in 2004. Key points include:
- Revenues increased 29% to $37.2 billion, driven by acquisitions as well as 8% organic revenue growth.
- Net earnings increased 42% to $2.6 billion and operating cash flows grew 38% to $4.1 billion.
- The medical care ratio improved slightly to 80.6% due to premium rate increases slightly outpacing medical cost growth.
- Earnings from operations grew 40% to over $4.1 billion, with all business segments showing growth.
PACCAR is a multinational company that manufactures heavy-duty trucks under the Kenworth, Peterbilt, DAF, and Foden brands. It competes in the North American medium-duty market and the European medium and heavy-duty markets. PACCAR also produces industrial winches and competes in the aftermarket parts business. In 2002, PACCAR saw record revenues and more than double the net income of 2001 due to strong product quality, diversification, and technology investments. PACCAR increased its market share in North America and Europe for both medium and heavy-duty trucks.
The document is the 2005 annual report of Erie Indemnity Company. It discusses Erie Indemnity's financial results for 2005 which showed a 2.1% increase in net income to $231.1 million and a 4.0% increase in net income per share to $3.34. The report also discusses strategic initiatives undertaken in 2005 to strengthen Erie Insurance Group's competitive position and underwriting discipline. These initiatives have positioned the company to pursue balanced growth through disciplined underwriting and expansion of its agency force.
This annual report summarizes Host Hotels & Resorts' performance in 2006. It owned interests in 128 premium hotels across 8 countries and 50 markets. The report highlights the Westin Kierland Resort & Spa in Scottsdale, Arizona, a 732-room luxury hotel located on a beautifully landscaped property featuring 27-hole golf and a spa. Financially, Host Hotels saw increases in operating profit, net income, earnings per share, total assets, and comparable hotel metrics like average daily rate and revenue per available room compared to 2005. The report includes sections on messages to stockholders, management, financial statements and portfolio details.
This document is Gannett Co.'s 2005 annual report. It includes a financial summary showing increases in operating revenues and income from continuing operations compared to 2004. It also includes letters to shareholders from the chairman and CEO discussing leadership changes at Gannett in 2005, acquisitions made to expand the company's reach both within traditional media and new digital platforms, and efforts to measure audience reach across multiple platforms and expand online offerings.
Goodrich Corporation announced its second quarter 2004 results, reporting a net income of $39 million compared to $14 million in the second quarter of 2003. Sales increased to $1,134 million from $1,095 million. Goodrich also increased its full year 2004 outlook, expecting sales between $4.7-4.75 billion and fully diluted earnings per share between $1.30-1.40. The increased outlook was due to improving conditions in commercial aerospace aftermarket and military and space markets.
The document is URS Corporation's proxy statement for its 2006 annual meeting of shareholders. It provides information about matters to be voted on at the meeting, including the election of directors, an amendment to the company's equity incentive plan, and a shareholder proposal regarding majority voting. It also provides information about URS Corporation's board of directors, executive compensation, voting procedures, and other standard annual meeting topics.
This document is a proxy statement from URS Corporation providing notice of its 2007 Annual Meeting of Shareholders. It summarizes the business to be conducted including electing directors and ratifying the selection of the independent accounting firm. It provides details on voting procedures, recommendations of the board, and requirements for stockholder proposals for the next annual meeting.
The document is a proxy statement from URS Corporation announcing their 2008 Annual Meeting of Shareholders. It provides details on five items of business to be voted on: 1) Election of directors, 2) Approval of an amendment to increase authorized shares of common stock, 3) Approval of the 2008 Equity Incentive Plan, 4) Approval of the 2008 Employee Stock Purchase Plan, and 5) Ratification of the selection of PricewaterhouseCoopers LLP as the independent auditor. It also provides information on voting procedures, the board's voting recommendations, and the vote required to approve each item.
The document is an amendment to a Form 10-K filed by URS Corporation to correct the application of an accounting standard. It restates financial statements for fiscal years 2004 and 2003 to properly report cash balances and book overdrafts. The amendment only impacts the company's balance sheet classifications and cash flow statements, and does not affect previously reported income, expenses, or stockholders' equity.
This document is an annual report filed by URS Corporation with the SEC. It provides an overview of the company's business for the past year. URS operates through two divisions, the URS Division and the EG&G Division, which provide professional planning, engineering, and technical services to federal and state government agencies and private clients. The report discusses URS' key markets and services, major client types, and provides a breakdown of fiscal year 2005 revenues by client type.
This document is an annual report filed by URS Corporation that provides an overview of the company's business for the past year. It discusses the company's clients, services, markets, and financial information. URS operates through two divisions, providing engineering and construction services, as well as systems engineering and technical assistance services primarily to US federal government agencies like the Departments of Defense and Homeland Security. The report provides details on the company's revenues, services, and markets by client type, including federal government, state and local government, private industry, and international clients.
URS Corporation filed its annual report on Form 10-K for the fiscal year ended December 28, 2007. The filing includes information on the company's business segments, clients served, services provided, and markets addressed. It also provides consolidated financial statements and notes to the financial statements.
URS Corporation provides engineering, construction, and operations and maintenance services worldwide. In 2004:
- URS enjoyed strong growth, benefiting from its scale and diversity of service offerings as well as its reputation for delivering high-quality, mission-critical services.
- The federal sector accounted for nearly 50% of revenue and continued to be a major driver of business, with growth in defense and homeland security projects.
- International operations performed well, with increases in transportation projects in Asia-Pacific and opportunities in Europe for environmental work.
URS Corporation had a very successful 2006 fiscal year, achieving record revenues of $4.2 billion and net income of $113 million. The company benefited from strong demand across all of its market sectors, particularly increased federal government spending on infrastructure and military projects. URS also saw a recovery in its private sector business, which grew 13% due to strategic partnerships with large corporations and increased capital spending in industries like oil and gas. Looking ahead, the company is well positioned for continued growth with a record backlog of $12.4 billion in business.
URS is one of the largest engineering design firms worldwide and provides services for infrastructure projects globally. Infrastructure such as transportation networks, water and wastewater systems, and public facilities are deteriorating and in need of modernization. Governments are increasing investment in infrastructure improvements to promote economic growth. URS is at the forefront of modernizing infrastructure, providing planning, engineering, architecture and construction management services for projects in the U.S., U.K., Australia and New Zealand. A 2005 study estimated $1.6 trillion is needed over five years for infrastructure upgrades in the U.S. alone.
URS Corporation is a fully integrated engineering, construction, and technical services organization with over 56,000 employees worldwide. In 2007, URS acquired Washington Group International, significantly expanding its capabilities. URS now offers services across the entire project lifecycle from planning and design through construction, operations and maintenance, and decommissioning. The acquisition nearly doubled URS's size and enhanced its ability to serve key markets such as power, infrastructure, federal, and industrial/commercial sectors.
Northern Trust Global Investments held an Investor Day in 2008 to outline its strategic priorities and growth opportunities. NTGIs key strategies are to serve personal and institutional clients through quantitative, manager of managers, and fixed income investments while building the business globally and delivering investment excellence. NTGIs assets under management have grown strongly to $778.6 billion as of March 2008 across asset classes, client segments, and investment styles including active, quantitative, and manager of managers approaches. NTGIs growth will be led by client specific solutions and expanding capabilities in both the personal and institutional markets globally.
This document outlines Northern Trust's Corporate & Institutional Services business. It discusses their strategic priorities which include competing globally, using complexity to drive innovation, offering a broad array of solutions, having a unique global operating model, and extending their industry-leading technology platform. It highlights their success in key regions around the world and with target client segments. It also discusses their asset servicing solutions, global operating model, growth in assets under custody and management, financial performance, and strategic growth initiatives focused on key regions.
Northern Trust's Personal Financial Services division provides wealth management services to high-net-worth individuals and families. It has over $146 billion in assets under management across private client services, wealth advisory services, and wealth management. The division aims to strengthen its client-centric culture and expand its service offerings through initiatives like integrated client teams, expanded investment solutions, and new services like family advisory offices.
This document provides an overview of Northern Trust Corporation's strong financial performance over the past 20 years despite navigating various economic crises and interest rate cycles. It highlights record financial results in 2007 with growth in revenues, net income, assets under custody and management. Northern Trust has achieved positive or neutral operating leverage in 17 of the past 20 years. The presentation focuses on net interest income growth, credit quality, capital management and business unit financials.
This document provides an overview of Northern Trust Corporation's 2008 Investor Day presentation. It discusses Northern Trust's business model, key strategies, and growth opportunities across its Personal Financial Services, Corporate & Institutional Services, and Northern Trust Global Investments divisions. Financial highlights and performance metrics are also presented for each business segment. The presentation emphasizes Northern Trust's client-centric approach and focus on serving target institutional and affluent client markets globally.
The document is a presentation by Northern Trust Corporation's Chief Financial Officer at a banking conference in 2008. It discusses the changing landscape in the financial services industry brought on by the financial crisis. It summarizes Northern Trust's business model of focusing on wealth management and asset servicing, and its conservative approach. It highlights the company's strong capital position and asset quality compared to peers.
This document is a presentation by Northern Trust Corporation's president and CEO Frederick Waddell at the 2009 Citigroup Financial Services Conference. The presentation discusses:
1) Significant and rapid changes that occurred in the financial services industry in 2008, including government interventions and increased oversight.
2) Northern Trust's strategic positioning in corporate and institutional services, global investments, and personal financial services has allowed it to maintain sound fundamentals like earnings power and balance sheet strength.
3) Northern Trust has resisted changing its client-centric business model focused on sectors like pensions, endowments, and family offices, avoiding riskier areas like investment banking, sub-prime lending, and brokerage.
The document announces the annual meeting of stockholders of Northern Trust Corporation to be held on April 17, 2007 at 10:30 am at their headquarters in Chicago. The purposes of the meeting are to elect 14 directors, approve an amended stock plan, ratify the appointment of the independent auditors, and conduct any other business. Stockholders of record as of February 26, 2007 are eligible to vote. Stockholders are urged to vote promptly by returning their proxy card, voting by phone or internet, or attending the meeting in person.
The document announces the annual meeting of stockholders of Northern Trust Corporation to be held on April 21, 2009 at 10:30 am at their offices in Chicago, Illinois. The purposes of the meeting are to elect 14 directors, ratify the appointment of the independent auditors, consider an advisory vote on executive compensation, and address any other business matters. Stockholders of record as of March 2, 2009 are eligible to vote. Stockholders are urged to vote by proxy card, telephone, internet, or in person at the meeting.
2. Elemental Economics - Mineral demand.pdfNeal Brewster
After this second you should be able to: Explain the main determinants of demand for any mineral product, and their relative importance; recognise and explain how demand for any product is likely to change with economic activity; recognise and explain the roles of technology and relative prices in influencing demand; be able to explain the differences between the rates of growth of demand for different products.
Lecture slide titled Fraud Risk Mitigation, Webinar Lecture Delivered at the Society for West African Internal Audit Practitioners (SWAIAP) on Wednesday, November 8, 2023.
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
Seminar: Gender Board Diversity through Ownership NetworksGRAPE
Seminar on gender diversity spillovers through ownership networks at FAME|GRAPE. Presenting novel research. Studies in economics and management using econometrics methods.
Abhay Bhutada, the Managing Director of Poonawalla Fincorp Limited, is an accomplished leader with over 15 years of experience in commercial and retail lending. A Qualified Chartered Accountant, he has been pivotal in leveraging technology to enhance financial services. Starting his career at Bank of India, he later founded TAB Capital Limited and co-founded Poonawalla Finance Private Limited, emphasizing digital lending. Under his leadership, Poonawalla Fincorp achieved a 'AAA' credit rating, integrating acquisitions and emphasizing corporate governance. Actively involved in industry forums and CSR initiatives, Abhay has been recognized with awards like "Young Entrepreneur of India 2017" and "40 under 40 Most Influential Leader for 2020-21." Personally, he values mindfulness, enjoys gardening, yoga, and sees every day as an opportunity for growth and improvement.
Vicinity Jobs’ data includes more than three million 2023 OJPs and thousands of skills. Most skills appear in less than 0.02% of job postings, so most postings rely on a small subset of commonly used terms, like teamwork.
Laura Adkins-Hackett, Economist, LMIC, and Sukriti Trehan, Data Scientist, LMIC, presented their research exploring trends in the skills listed in OJPs to develop a deeper understanding of in-demand skills. This research project uses pointwise mutual information and other methods to extract more information about common skills from the relationships between skills, occupations and regions.
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2. HOST MARRIOTT
Will be the premier hospitality real estate company. We will own high quality lodging
assets in prime urban, airport and resort/convention locations. Creating value through
aggressive asset management and disciplined capital allocation to generate superior
performance, we will maximize shareholders’ returns through a combination
of dividends, growth in funds from operations and
increases to net asset value per share.
CONTENTS
TO OUR SHAREHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
BOARD OF DIRECTORS AND MANAGEMENT TEAM . . . . . . . . . . . . . . 16
MANAGEMENT’S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION . . . . . . . . . . . . . . . . . . 17
FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . 35
AUDITED FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . 36
MANAGEMENT’S REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
INDEPENDENT AUDITORS’ REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SELECTED FINANCIAL DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
HOST MARRIOTT PORTFOLIO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
DIRECTORS AND OFFICERS . . . . . . . . . . . . . . . . . . INSIDE BACK COVER
CORPORATE INFORMATION . . . . . . . . . . . . . . . . . INSIDE BACK COVER
ORLANDO WORLD CENTER MARRIOTT
COVER:
THE ORLANDO WORLD CENTER MARRIOTT IS CONSISTENTLY ONE OF THE MOST POPULAR CONVENTION HOTELS IN THE NATION.
WITH 2,000 ROOMS, AN 18-HOLE CHAMPIONSHIP GOLF COURSE ON-SITE, AND 214,000 SQUARE FEET OF MEETING SPACE, IT ALLOWS GUESTS
TO ENJOY THE BENEFITS OF A SUPERIOR RESORT, HEALTH SPA, GOLF AND CONVENTION CENTER COMPLEX ALL IN ONE LOCATION.
3. FINANCIAL HIGHLIGHTS
(Unaudited, in millions, except per share data, hotel data, and stock price)(1) 2001 2000
2002
OPERATING DATA
Revenues $ 3,680 $ 3,767 $1,407
Income (loss) before extraordinary items (22) 53 159
Net income (loss) available to common shareholders (51) 19 141
DILUTED EARNINGS (LOSS) PER COMMON SHARE
Income (loss) before extraordinary items $ (.21) $ .09 $ .64
Diluted earnings (loss) $ (.19) $ .08 $ .63
Diluted weighted average shares outstanding 263.0 253.2 225.6
BALANCE SHEET DATA
Total assets $ 8,316 $ 8,338 $8,396
Debt 5,638 5,602 5,322
Convertible Preferred Securities 475 475 475
Equity 1,610 1,609 1,421
OTHER DATA
EBITDA(2)(6) $ 863 $ 947 $1,098
(3)(6)
Comparative Funds From Operations 300 370 477
(3)(6)
Comparative Funds From Operations per diluted share 1.11 1.42 2.01
Stock price on December 31st 8.85 9.00 12.94
COMPARABLE HOTEL DATA (4)
Number of properties 118 118
Number of rooms 56,327 56,327
Average daily rate $142.17 $151.16
Occupancy percentage 70.4% 69.8%
RevPAR(5) $100.12 $105.45
(1) This table presents certain selected historical data that has been derived from our audited consolidated financial
statements and other operating data of the company.
(2) Represents Earnings Before Interest Expense,Taxes, Depreciation, Amortization, and other non-cash items (“EBITDA”)
of Host Marriott, L.P. EBITDA for Host Marriott Corporation was $863 million, $906 million and $1,043 million,
respectively, for the three years ended December 31, 2002.
(3) Comparative Funds From Operations is Funds From Operations, as defined by the National Association of Real Estate
Investment Trusts, adjusted for significant non-recurring items.
(4) We define our comparable hotels as properties that are owned, or leased directly or indirectly by us, and for which we
reported operations throughout 2002 and 2001.We exclude from our operating results hotels that have been acquired or
sold during the periods, or that have had substantial property damage or that have undergone large-scale capital projects.
(5) Room revenue per available room (“RevPAR”) represents the combination of average daily room rate charged and the
average daily occupancy achieved, and is a commonly used indicator of hotel performance. RevPAR does not include
food and beverage or other ancillary revenues generated by the property.
(6) EBITDA, Comparative Funds From Operations and Comparative Funds From Operations per diluted share are non-
GAAP financial measures within the meaning of securities rules. For more information about the company’s uses of
these measures and reconciliations to the most directly comparable GAAP measure, see “Management’s Discussion and
Analysis of Results of Operations and Financial Condition.”
4. TO OUR SHAREHOLDERS
RICHARD E. MARRIOTT
Chairman of the Board
CHRISTOPHER J. NASSETTA
President and Chief Executive Officer
By any measure, the last two years have been some share compared to $1.42 per diluted share in 2001.
of the most challenging times in the history of the Earnings Before Interest Expense, Taxes, Depre-
lodging industry. Despite this difficult operating envi- ciation and Amortization and other non-cash items
ronment, we achieved a number of important goals (EBITDA) was $863 million compared to $947 mil-
during the past year that will position the company lion a year ago. Comparable RevPAR declined
for growth as the industry inevitably recovers: 5.1 percent from 2001, with average room rates down
5.9 percent while occupancy increased nearly one
we renegotiated the management agreements for
I
percentage point. The company’s diluted loss per share
90% of our portfolio, providing us with new rights
and improved operating cash flows; was ($.19) compared to diluted earnings per share
of $.08 in 2001.
we maintained more than $360 million in cash
I
reserves at year-end through a combination of the Although the expected industry turnaround did
renegotiation of our management agreements and not materialize in 2002, and the year ahead remains
prudent financial management; uncertain, Host Marriott’s best in class lodging
we purchased the 1,139-room Boston Marriott Copley
I portfolio provides an unmatched opportunity to take
Place at a significant discount to replacement cost; advantage of the inevitable improvement in lodging
we further streamlined our business by selling our fundamentals as the economy improves.We will con-
I
interests in three public limited partnerships; and tinue our aggressive portfolio management and remain
we maintained our portfolio’s RevPAR premium disciplined in our approach to capital allocation to
I
to our competition. generate superior performance in the years to come.
While these achievements do not make up for a dis-
appointing year, we believe they exemplify the focus and MANAGING OUR B ALANCE SHEET
Host Marriott always has recognized the strategic
disciplined approach to our business that will further our
importance of focusing on liquidity, maintaining a
goal of being the premier hospitality real estate company.
stable balance sheet, and increasing financial flexibility
Looking at our performance for 2002, Compara-
to be able to meet the business challenges confronting
tive Funds From Operations was $1.11 per diluted
H O S T M A R R I OT T 2 0 0 2
2
5. the lodging industry and to position the company to also work closely with hotel operators to keep our
take advantage of value-creating opportunities as they properties operating at peak levels by improving yield
arise. The past year was no exception, and the results management and creating additional revenue sources.
of our efforts are encouraging. Over the past year, demand in the higher rated
Our near-term liquidity is strong and more than corporate/premium segments has decreased as the
sufficient to deal with the impact of international trend in the mix of business continues to shift
events on our business. Over time, strengthening toward group and contract business. We maximized
our balance sheet remains a high priority. While results by concentrating on increasing short-term
the economic downturn of the past two years has group sales, and on discounted individual and
effectively resulted in an increase in our leverage, group business. The size and location of our urban,
that leverage will decrease as operations inevitably resort and convention hotels has helped in these
improve. In the near-term, we will pursue opportu- efforts, enabling our managers to be creative and
nities to reduce flexible in using
leverage by meeting and
Financially strong and poised for future growth
the selective catering space
recycling of to adapt to
and success, Host Marriott is truly the premier
capital and the the needs of
paydown of both large and
hospitality real estate company.
debt. Going small groups.
forward, such This strategy
improvements will have a positive impact on both has helped increase occupancy for our portfolio of
our credit rating and our cost of capital. premium properties and maintain their superior posi-
tion in the market, generating an average occupancy
B E N E F I T I N G F RO M S U P E R I O R
of 70% — roughly 11 points better than the overall
ASSET MANAGEMENT
Controlling operating costs has been another prior- industry. This occupancy premium helps drive a
ity over the past year. The quality of our portfolio RevPAR premium at our properties. In 2002, our
creates high guest expectations, and our team is RevPAR was 14% higher than our competition,
working closely with our hotel operators to establish proving that even in the down market our properties
and refine operating benchmarks, reduce labor costs attract more than their fair share of lodging demand.
and generate savings in ways that do not impact The combination of aggressive cost control
on the perceived quality of our hotels or guest measures, increased occupancy and a rise in food and
satisfaction. Our efforts to control hotel operating beverage revenues, which represented 32% of total
costs have minimized the overall decline in margins, revenues in 2002, helped minimize the impact of
despite the decline in revenues, while our asset RevPAR declines at our properties during 2002.
managers constantly strive for new ways to add In fact, food and beverage profits increased during
efficiency and improve bottom line results. the year, moving up two percent.
Cost control is only one component of the In 2003, we anticipate increased pressure on
aggressive asset management process that is a primary operating margins as increases in certain costs such
driver of our business strategy. Our asset managers as wages, benefits and insurance are expected to
H O S T M A R R I OT T 2 0 0 2
3
6. exceed inflation. Additionally, to mitigate potential Since its inception, Host Marriott has strategi-
significant weakness in operations that may result cally allocated capital to create long-term share-
from war or terrorist acts, we have developed con- holder value. Initially, we concentrated on building
tingency plans for all of our hotels. These plans will our portfolio by acquiring premium hotel assets that
help them react quickly to reduce costs and operate met our demanding, best in class standards. Between
at lower breakeven levels, as necessary. 1995 and 1998 alone, we bought $6 billion in full
service upper-upscale and luxury hotels at significant
discounts to replace-
S T R A T E G I C A L LY
ment costs, growing our
A L L O C AT I N G C A P I TA L
We are mindful of the full-service portfolio
need to maintain the over four-fold.
standards of excellence As both hotel
that set us apart. Our property pricing and
business is capital inten- performance peaked,
sive in terms of building, we re-allocated capital
furniture, fixtures and expenditures to ex-
equipment maintenance panding and investing
and refurbishment, and in our existing proper-
we cannot neglect ties. For example, creat-
needed improvements as ing new profit centers
our properties age. Since within our hotels by
1998, we have spent building relationships
$1 billion on mainte- with companies such
nance and property as Starbucks, The Palm
enhancements to uphold and other well-known
our standards and to operators whose name
drive future revenue brand products have
growth. Even in this been well received
S A N F R A N C I S C O M O S C O N E M A R R I OT T
difficult operating envi- by our guests.
A spectacular landmark in one of the world’s greatest cities,
ronment, our historical While we will
the San Francisco Moscone Marriott features 1,498 rooms and
capital expenditures have over 100,000 square feet of meeting and banquet space. continue to focus on
This premier convention hotel is just steps away from the
enabled us to judiciously improving the returns
Moscone Convention Center and Buena Vista Gardens.
manage our repair and on our existing proper-
maintenance activity to ties, we believe that
ensure that our hotels maintain our high standards of ultimately there will be a number of attractive
excellence. We continue to seek ways to improve the opportunities to acquire individual hotel properties
capital expenditure process, looking to reduce overall and portfolios that meet our criteria for excellence
outlays while increasing the useful life of ongoing and provide the potential for attractive returns. We
and necessary improvements. will consider using stock in making acquisitions
H O S T M A R R I OT T 2 0 0 2
4
7. NEW YORK MARRIOTT FINANCIAL CENTER
Combining contemporary flair with traditional elegance, the New York Marriott
Financial Center has recently been renovated to meet the expectations of the
most demanding guests. Its 504 richly appointed rooms combine comfort with
technology to make every stay both relaxing and productive.
8.
9. THE R I T Z - C A R LTO N MARINA DEL REY
The Jer-Ne restaurant, in the 304-room Ritz-Carlton Marina del Rey,
is a California showcase for the combination of style and gourmet cuisine
for which Ritz-Carlton is known around the world.
10. when we are confident that we can create value on Part of our capital allocation process is the sale
a per share basis. Most importantly, we will continue of non-core assets, provided we can obtain satisfac-
our disciplined approach to growth by buying the tory pricing, that are not in keeping with our long-
best assets in the best markets with the best brands term strategic goals or fail to meet our ongoing
managed by the best operators. investment criteria. Examples include hotels in
A recent example is the June 2002 acquisition slower growth markets and properties that require
of the Boston Marriott Copley Place for $214 mil- significant capital improvements. By doing so, we can
lion. Located in Boston’s decrease our leverage or
famous Back Bay dis- seek better long-term
trict, this 1,139-room returns by reinvesting
hotel has the largest sale proceeds in assets
ballroom in New that meet our target
England and offers profile. In keeping with
meeting planners the this strategy, we sold the
flexibility of more than Ontario, California
60,000 square feet of Airport Marriott early
meeting, exhibit and in 2003 for $26 million
banquet space. We were and used the proceeds
able to add this premier to repay debt.
hotel in a gateway During 2002, we
market to our portfolio enhanced our ability
at a 35% discount to to complete other such
replacement cost, and strategic dispositions
we are very confident in in the future by com-
the long-term prospects pleting negotiations to
for this property. modify the management
In pursuing this agreements on approxi-
disciplined approach to mately 90% of our
ˆ
S W I S S OT E L C H I C A G O
expansion, we will seek portfolio. In addition
Overlooking the Chicago River and Lake Michigan, the Swissôtel Chicago
to further diversify our to providing an imme-
is an all-glass architectural masterpiece where guests
find personalized service and luxurious accommodations.
portfolio of brands. Our diate cash inflow of
The hotel’s 632 rooms are only two blocks from the city’s
focus will continue to be $125 million and future
famous “Magnificent Mile” shopping area.
luxury and upper-upscale cash benefits, the modi-
properties located in fied agreements expand
urban, convention and resort markets with high the pool of hotels that we can sell, over time, unen-
barriers to entry.We will target the industry’s strongest cumbered by existing management contracts or
brands, working with operators such as Hyatt, Hilton brand. By making these properties more attractive
and Starwood, while continuing to strengthen our to potential buyers, these agreements substantially
relationship with Marriott International. enhance our ability to recycle capital.
H O S T M A R R I OT T 2 0 0 2
8
11. BOSTON MARRIOTT COPLEY PLACE
The Boston Marriott Copley Place provides a convenient base for pleasure and
business travelers alike in Boston’s famous Back Bay. Staying in one of its 1,139 luxury
rooms enhances any trip to one of America’s most historic cities.
12.
13. NEW YORK MARRIOTT MARQUIS
All the excitement and glamour of New York and Times Square are captured in
the New York Marriott Marquis. This spectacular 1,944-room convention property
draws visitors from all over the world, who enjoy its luxury accommodations,
fine cuisine and unmatched location.
14. P R E M I U M A S S E T S A R E K E Y TO F U T U R E S U C C E S S of 2002. Her leadership skills and operations back-
The operating environment for the lodging industry ground will be a valuable addition to our independ-
is little changed as we enter 2003. The economy ent Board, supplementing and complementing
has yet to strengthen and operations remain weak. the depth and range of experience of our other
The war in Iraq and fear of additional terrorist members. We know Host Marriott will benefit
activity cloud the picture further. from her contributions.
Despite this less than encouraging operating fore- We remain confident about the future. That
cast, we are positive confidence is based
about the intermediate on the knowledge that
and long-term prospects Host Marriott truly is
for the lodging industry the premier hospitality
as a whole and, particu- real estate company,
larly, for Host Marriott. and we are well posi-
Industry supply growth is tioned to succeed. We
at historically low levels have met the challenges
and should remain so for of the past two years
the next several years. As with imagination and
the economy begins to determination. Our
improve, lodging funda- portfolio, management
mentals will continue to team and operators are
strengthen, and increas- all best in class. We
ing demand should result remain financially
in meaningful growth in strong and poised for
RevPAR, earnings and growth when the
dividends. Host industry recovers.
Marriott’s combination We appreciate the
of luxury and upper- support of our share-
upscale assets and holders, and we remain
FOUR SEASONS PHILADELPHIA
premier locations will committed to providing
The Four Seasons Philadelphia is situated in the cultural heart
drive premium pricing you with attractive
of its historic home city, offering 364 elegantly furnished guest
and returns as demand rooms to discriminating travelers who seek enduring quality, returns and increasing
faultless service and unrelenting attention to detail.
increases. Until that time, shareholder value.
we will be prudent with
our capital and keep a sharp focus on the operating
performance of our portfolio. RICHARD E. MARRIOT T
Chairman of the Board
We are pleased that we have a new member
of our Board of Directors who will help guide
our company’s future growth. Judith A. McHale,
C H R I S TO P H E R J . N A S S E T TA
president and chief operating officer of Discovery President and Chief Executive Officer
Communications, Inc., joined our Board at the end FEBRUARY 25, 2002
H O S T M A R R I OT T 2 0 0 2
12
15. GRAND H YAT T AT L A N TA
Guests enjoy the elegance and classic character of the
Grand Hyatt Atlanta, a 438-room luxury hotel located in Buckhead,
Atlanta’s most prestigious and fashionable district.
16.
17. ORLANDO WORLD CENTER MARRIOTT
The Lobby Bar is a favorite meeting spot at the Orlando World Center Marriott.
Guests in the 2,000-room hotel can choose among nine different dining and
lounge options ranging from comfortably casual to sublimely elegant.
18. BOARD OF DIRECTORS
Back row, left to right: Terence C. Golden, Judith A. McHale, John G. Schreiber
Ann McLaughlin Korologos, Christopher J. Nassetta, Richard E. Marriott, Robert M. Baylis
MANAGEMENT TEAM
Back row, left to right: Jules A. Sieburgh, Matthew L. Richardson, Pamela K. Wagoner, John A. Carnella, Richard A. Burton
Larry K. Harvey, James F. Risoleo, Elizabeth A. Abdoo, Christopher J. Nassetta, W. Edward Walter, Gregory J. Larson
H O S T M A R R I OT T 2 0 0 2
16
19. M A N AG E M E N T ’ S D I S C U S S I O N A N D A N A LYS I S O F R E S U LT S O F
O P E R AT I O N S A N D F I N A N C I A L C O N D I T I O N
The following discussion and analysis should be read in these services as well as depreciation, management fees, real
conjunction with the consolidated financial statements and and personal property taxes, ground rent, equipment rent,
related notes and the other financial information included property insurance, income taxes of our consolidated tax-
elsewhere in this report.This discussion includes forward- able REIT subsidiaries and other costs.
looking statements about our business and operations. The operating environment during 2002 presented
Our actual results could differ materially from those cur- many challenges and was influenced significantly by
rently anticipated and expressed in such forward-looking reduced airline travel, weak economic conditions and gen-
statements and as a result of risk factors we describe in our eral international unrest as a result of the threat of further
Form 10-K and in other filings with the Securities and terrorist activity and the war in Iraq. As a result, the lodg-
Exchange Commission, or SEC. ing industry and our company experienced significant
declines in revenues and operating profits because of
reduced demand and rising operating expenses, including
OVERVIEW
increased insurance costs.We expect these conditions to
Host Marriott Corporation, a Maryland corporation,
persist into 2003.We are expecting RevPAR in 2003 to
is the owner of 122 hotel properties, which operate
be generally comparable to 2002 levels or modestly lower,
primarily in the luxury and upper-upscale hotel seg-
though RevPAR is likely to decline in the first half of
ments.We conduct our operations as an umbrella part-
2003.We also expect continuing pressure on operating
nership real estate investment trust, or REIT, through our
margins as we expect that certain important components
direct and indirect subsidiaries, including Host Marriott,
of our operating costs, such as wages, benefits and insur-
L.P., or Host LP, a Delaware limited partnership of which
ance, will increase at a rate greater than estimated inflation
we are the sole general partner and hold approximately
in 2003.Thus, operating profits and margins for 2003 will
90% of the partnership interests. As of February 2003, the
likely be below 2002 levels, especially if economic condi-
National Association of Real Estate Investment Trust
tions do not improve.
ranks us as the largest lodging REIT.
We have a significant fixed-cost component and
Our hotels are operated under brand names that are
expenses associated with owning and operating hotels,
among the most respected and widely recognized in the
which do not necessarily decrease when circumstances
lodging industry—including Marriott, Ritz-Carlton,
such as market factors cause a reduction in revenue for
Four Seasons, Hilton and Hyatt. Our properties are
the property. As a result, changes in RevPAR can result in
located in central business districts of major cities, near
a greater percentage change in our earnings and cash
airports and in resort/convention locations. Our portfolio
flows. In response to the decline in the operations of our
depends on revenue from large and small group business,
hotels in 2002 and 2001, we have been working with our
business travel, as well as leisure and discount travelers.
hotel managers to achieve cost reductions at the proper-
The target profile of our portfolio includes upper-upscale
ties, and we believe that these efforts have slowed the
and luxury properties in hard to duplicate locations that
decrease in our operating margins. Although some of
may allow us to maintain room rate and occupancy pre-
these cost savings may not be permanent, we believe that
miums over our competitors.We seek to maximize the
we have achieved some meaningful long-term efficien-
value of our portfolio through aggressive asset manage-
cies. In the future, margin improvement will generally be
ment, by directing the managers of our hotels to reduce
dependent upon revenue growth as additional cost reduc-
operating costs and increase revenues and by completing
tions may be difficult to obtain and, as noted above, we
selective capital improvements.
expect that certain of our costs will increase at a rate
Our hotel sales traditionally experienced moderate sea-
greater than inflation in 2003.
sonality, which varies based on the individual hotel property
As of December 31, 2002, we were under the 2.0
and the region.Additionally, hotel revenues in the fourth
to 1.0 EBITDA-to-cash interest coverage ratio required
quarter typically reflect a greater proportion of our annual
under the senior notes indenture. As a result, dividends
revenues than each of the prior quarters because our fourth
on both common and preferred shares were restricted to
quarter reflects sixteen weeks of results compared to twelve
the minimum amount of distributions required to main-
weeks for the first three quarters of the fiscal year.
tain our REIT status. Required distributions for 2002
Our results of operations primarily represent hotel level
were satisfied in part by payment of dividends on the
sales, which are room, food and beverage and other ancil-
preferred shares in 2002.We believe that the remaining
lary income such as telephone, parking and other guest
2002 distribution requirement should largely be satisfied
services. Operating expenses consist of the costs to provide
H O S T M A R R I OT T 2 0 0 2
17
20. by the payment of dividends expected to be declared on SCHEDULE OF COMPARABLE HOTEL-LEVEL RESULTS (1)
preferred shares in the first, second and third quarters U N A U D I T E D, I N M I L L I O N S ,
2002 2001
E X C E P T H OT E L S TAT I S T I C S
of 2003.We may, however, also need to pay a nominal
Number of hotels 118 118
common dividend in 2003 to the extent necessary to
Number of rooms 56,327 56,327
satisfy any remaining 2002 distribution requirement.
Percent change in Comparable RevPAR (5.1)% —
The payment of any additional dividends on either com- Comparable hotel operating profit margin 24.2% 26.0%
mon or preferred shares will depend on 2003 operating Percent change in comparable
operating profit (9.6)% —
performance and its impact on taxable income and
Sales:
whether our EBITDA-to-cash interest coverage ratio is
Room $ 2,082 $ 2,160
at least 2.0 to 1.0 coverage for 2003. Food and beverage 1,118 1,114
Portfolio Performance. Set forth below is informa- Other 248 282
tion about the performance of our hotel properties, Hotel sales 3,448 3,556
including for our comparable hotels (as defined below).
Expenses
This information includes unaudited hotel operating Room 512 520
profit and operating profit margin for our comparable Food and beverage 819 821
Other 144 147
properties. Comparable hotel operating profit is a
Management fees, ground rent
non-GAAP financial measure within the meaning of
and other costs 1,138 1,144
applicable SEC rules. We believe that the comparable
Hotel expenses 2,613 2,632
hotel-level results help us and our investors evaluate
the recurring operating performance of our properties COMPARABLE HOTEL
835 924
O P E R AT I NG P RO F I T
in similar environments, including in comparisons with
Business interruption insurance
other REITs and hotel owners. While these measures proceeds, net(2) 17 —
are based on accounting principles generally accepted Non-comparable hotel results, net 31 30
in the United States of America, or GAAP, costs such Office building and limited service
properties, net 4 9
as depreciation, corporate expenses and other non-
Depreciation expense (372) (374)
recurring revenues and expenses have been incurred
Corporate and other expenses (49) (51)
and are not reflected in this presentation. As a result, Lease repurchase expense — (5)
the comparable hotel-level results do not represent
$ 466 $ 533
O P E R AT I NG P RO F I T
total revenues or operating profit.
Further, results of operations for our hotels that are (1) We consider 118 of our hotels to be comparable properties for the
both managed and operated under the Marriott brand periods presented.The five non-comparable properties that we cur-
rently own for the periods presented are the New York Financial
name report results on a 52 or 53-week fiscal year, Center Marriott (substantially damaged in the September 11, 2001
which ends on the Friday closest to December 31. In terrorist attacks), the Boston Marriott Copley Place (acquired in
June 2002),The Ritz-Carlton, Naples Golf Resort (opened January
2002, these hotels reported 53 weeks of operations com-
2002), JW Marriott Mexico City and the Mexico City Airport
pared to 52 weeks for 2001. Our consolidated financial Marriott (we did not consolidate these two properties until we
acquired Rockledge Hotel Properties, Inc. in April 2001).
statements have been adjusted to reflect the results of
(2) Represents the $17 million of business interruption insurance
operations for these properties on a calendar year basis. proceeds, net of certain operating expenses, we have recognized for
However, in reporting our hotel operating statistics the Marriott World Trade Center, which was destroyed September 11,
2001 and the New York Marriott Financial Center which was also
(average room rates, occupancy, RevPAR and the damaged in the terrorist attack.
Schedule of Comparable Hotel-Level Results), the
results of the Marriott managed and branded hotels
RESULTS OF OPERATIONS
reflect 53 weeks in 2002 compared to 52 weeks in 2001.
Beginning January 1, 2001, we reported gross property
We define our comparable hotels as properties that
level sales from the majority of our hotels, and our
are owned or leased, directly or indirectly, by us and for
expenses included all property level costs including
which we reported operating results throughout 2002
depreciation, management fees, real and personal property
and 2001.We exclude from our operating results hotels
taxes, ground rent, equipment rent, property insurance and
that have been acquired or sold during those periods, or
other costs. Our revenues for 2000 represent rental income
that have had substantial property damage or that have
on leases of our hotels. Expenses during 2000 represent
undergone large scale capital projects.We also exclude
specific owner costs, including real estate and property
rental income from non-hotel properties and the results
taxes, property insurance and ground and equipment rent.
of our leased limited service hotels.
H O S T M A R R I OT T 2 0 0 2
18
21. As a result, our 2002 and 2001 results are not comparable likely decline in 2003 as a result of total costs increas-
to the historical reported amounts for 2000. ing at a rate greater than total revenues. In particular,
we expect that costs such as wages, benefits and insur-
ance will increase at a rate greater than inflation.
2 0 0 2 C O M PA R E D T O 2 0 0 1
Corporate Expenses. Corporate expenses decreased
Revenues. Hotel sales declined $50 million, or 1.4%,
by $2 million, or 6.3%, to $30 million in 2002 com-
to approximately $3,579 million for 2002 from $3,629
pared to 2001. The decrease in expenses was principally
million in 2001. The $50 million decrease in hotel sales
due to a decrease in stock-based compensation.
for 2002 primarily reflects the decrease in RevPAR
We have stock-based compensation plans under
for our properties of 4.9% to $100.74. While the
which we may award to participating employees options
decrease in RevPAR is due in part to the reduction
to purchase shares of our common stock, deferred
in business and leisure travel, it is also the result of the
shares of our common stock or restricted shares of our
change in business mix at our properties. Transient
common stock as well as an employee stock purchase
business, which includes the corporate and premium
plan. The restricted shares issued to certain officers and
business segments, which generally pay the highest
key executives vest over a three-year period in annual
average room rates, has decreased by over 3% since
installments based on continued employment and the
2000 as a percentage of room sales. Our managers have
attainment of performance criteria established by our
partially offset this decline with additional group and
Compensation Policy Committee. These shares are sub-
contract business and other segments that have lower
ject to market adjustments that result in compensation
average room rates. As a result, while occupancy has
expense (benefit) on a quarterly basis. As a result of the
increased slightly, the average room rate has declined
decline in our stock price and our operations in 2002,
significantly. We believe these trends will continue to
certain performance thresholds were not met, and a
affect our operations until the economy strengthens
portion of these shares previously granted were for-
and business travel increases.
feited, resulting in the reversal of expense previously
Rental income decreased $35 million, or 25.7%,
recognized and a reduction in 2002 overall expenses.
to $101 million for 2002 from $136 million in 2001.
Minority Interest Expense. For 2002 and 2001,
Rental income for 2002 and 2001 includes: 1) lease
we recognized minority interest expense of $7 million
income from our limited service hotel leases of $71
and $23 million, respectively. The variance is primarily
million and $77 million, respectively, 2) lease income
due to the decline in our results of operations over
from full-service hotel leases of $24 million and $53
the course of 2002.
million, respectively, and 3) office space rental income
Discontinued Operations. During January 2002,
of $6 million for both years. We repurchased the lessee
we transferred the St. Louis Marriott Pavilion to the
entities with respect to four of the remaining five full-
mortgage lender in a non-cash transaction. In accor-
service hotels leased to third parties effective June 16,
dance with SFAS No. 144, “Accounting for the
2001 and terminated those leases for financial reporting
Impairment or Disposal of Long-Lived Assets,” which
purposes. As a result, we currently record rental income
we adopted January 1, 2002, we classified the hotel’s
with respect to only one full-service hotel.
operating results as discontinued operations in all
Operating Costs and Expenses. Operating costs
periods presented. As a result, at December 31, 2002
and expenses decreased $20 million, or .6%, to $3,214
and 2001, we recorded income, net of taxes, of $7 mil-
million in 2002 compared to 2001. This decrease is pri-
lion and a loss of $3 million, respectively, as discontin-
marily the result of our efforts and those of our man-
ued operations.
agers to control operating costs at the hotels and the
Extraordinary Gain. During 2002, we recorded an
overall decline in occupancy. However, overall our
extraordinary gain, net of tax, of $6 million, represent-
comparable hotel operating profit margin decreased
ing the extinguishment of debt on the St. Louis
1.8 percentage points. Rental expense during 2002 and
Marriott Pavilion. During 2001, we recorded an
2001 for our limited service hotel leases was $70 mil-
extraordinary loss, net of tax, of $2 million representing
lion and $71 million, respectively, and office space
the write-off of deferred financing costs and certain
expense was $3 million for both periods. These
fees paid to our lender in connection with renegotia-
expenses are included in other property-level expenses
tions of the credit facility, as well as the refinancing of
on the consolidated statements of operations. As previ-
the mortgage debt on our Canadian properties.
ously discussed, we believe that operating margins will
H O S T M A R R I OT T 2 0 0 2
19
22. 2 0 0 1 C O M PA R E D T O 2 0 0 0 cutting during 2001 and a decrease of $6 million in
compensation expense related to employee stock plans.
Revenues. As discussed above, our revenues and operat-
Lease Repurchase Expense. In connection with the
ing profit for 2001 are not comparable to 2000, due to
definitive agreement with Crestline Capital Corporation,
our acquisition of the lessee entities by our wholly
or Crestline, in November 2000 for the purchase of the
owned taxable REIT subsidiary.The table below presents
leasehold interests with respect to 116 hotels, we
gross hotel sales for the years ended December 31, 2001
recorded a nonrecurring loss provision of $207 million.
and 2000. For 2000, gross hotel sales were used as the
In 2001, as a result of the purchase of four additional
basis for calculating rental income.The data is presented
leasehold interests, we recognized a loss of $5 million.
in order to facilitate an investor’s understanding and
Minority Interest Expense. For 2001 and 2000, we
comparative analysis of the operations of our properties
recognized minority interest expense of $23 million and
and does not represent our revenues for these periods.
$72 million, respectively.The variance is primarily due to
YE AR E ND E D the decrease in the minority interest ownership of the
operating partnership from 22% at December 31, 2000 to
D E CE MB E R 31, D E CE MBER 31,
2001 2000
IN MILLIONS
8% at December 31, 2001.The decline is also a reflection
HOTEL SALES of the decrease in our results of operations.
Rooms $2,550 $2,877
Equity in Earnings of Affiliates. Equity in earnings
Food and beverage 1,173 1,309
of affiliates decreased $24 million, or 89%, to $3 million
Other 306 323
for 2001.The decrease is principally due to the acquisi-
Total hotel sales $4,029 $4,509
tion and consolidation of Rockledge and Fernwood on
March 24, 2001.
The $480 million decrease in hotel sales for 2001 pri- Provision for Income Taxes. For the year ended
marily reflects the decrease in RevPAR for our properties December 31, 2001, we recorded an income tax provi-
of 13.7% to $105.96. Room sales also declined as a result sion of $9 million, a change of $107 million, from the
of the loss of sales from the New York Marriott World $98 million income tax benefit in 2000. The change is
Trade Center and the New York Marriott Financial primarily due to the $82 million benefit taken during
Center due to the terrorist acts of September 11, 2001. 2000 due to the recognition of the income tax asset as a
The declines were partially offset by incremental revenues result of the purchase of the leasehold interests with
provided by the 500-room expansion at the Orlando respect to 116 hotels. Also, during 2001 and 2000, we
Marriott, which was placed in service in June 2000, and favorably resolved certain tax matters and recognized
the addition of three hotels as a result of our consolida- $16 million and $32 million, respectively, related thereto
tion of Rockledge Hotel Properties, Inc. (“Rockledge”) as a benefit to our tax provision.
and Fernwood Hotel Assets, Inc. (“Fernwood”) as of
March 24, 2001. L I Q U I D I T Y A N D C A P I TA L R E S O U R C E S
The decline in RevPAR during 2001 was generally
Our principal sources of cash are cash from operations,
due to a decrease in occupancy of 7.7 percentage points
the sale of assets, borrowings under our credit facility
and a 4.1% decrease in room rates for the year. As a result
and our ability to obtain additional financing through
of decreased hotel sales, we directed our managers to
various financial markets. Our principal uses of cash are
implement cost cutting measures and revenue enhance-
for payments of debt, capital expenditures, asset acquisi-
ment programs at the property level during the second
tions, operating costs, corporate expenses and distribu-
quarter in order to stabilize operating profit margins.
tions to our equity holders and minority owners of the
These measures included increasing labor efficiency, par-
operating partnership. We believe our sources of cash
ticularly at the managerial level and in the food and
will be sufficient to meet our current liquidity needs.
beverage area at the hotels, reducing discretionary
As of December 31, 2002, we had $361 million of
expenses in rooms, food and beverage, and repairs and
cash and cash equivalents, which was an increase of
maintenance and reducing energy consumption.While
$9 million over our December 31, 2001 balance. In
we believe these measures were moderately successful,
addition, we have $133 million of restricted cash as a
profit margins on our portfolio of hotels still decreased
result of lender and management agreement restrictions.
3.0 percentage points for 2001.
Additionally, approximately $171 million of our avail-
Corporate Expenses. Corporate expenses decreased
able cash and cash equivalents is held by our wholly-
by $10 million, or 24%, as a result of corporate cost
owned taxable REIT subsidiaries. The distribution
H O S T M A R R I OT T 2 0 0 2
20
23. of this cash to the operating partnership could, under asset acquisitions.While we currently have $300 million
certain circumstances, increase our current or future of availability under our credit facility and have no
income tax expense and/or the amounts we are amounts outstanding thereunder, our forecast of opera-
required to distribute to maintain our status as a REIT. tions indicates that we may fail to meet certain mainte-
On July 25, 2002, we completed the renegotiation nance covenants for the credit facility during the second
of the management and other agreements on 102 of quarter of 2003. As a result, we expect to modify our
our Marriott and Ritz-Carlton branded hotels, provid- financial covenants in the credit facility.
ing us with expanded approval rights over operating Approximately $116 million of our mortgage debt
and capital budgets. In addition to these modifications, matures, and $102 million of regularly scheduled amortiza-
we expanded the pool of hotels subject to an existing tion on our mortgage debt occurs, prior to 2005.We have
agreement that allows us to sell assets unencumbered no other significant refinancing requirements until 2005.
by a Marriott management agreement without the We remain interested in pursuing single asset and
payment of termination fees. The revised pool includes portfolio acquisitions and have discussed the possibility
46 assets, 75% (measured by EBITDA) of which may of these transactions with several interested parties. We
be sold over approximately a ten-year or greater period believe there will be opportunities over the next several
(and 22.5% (measured by EBITDA) of which may be years to acquire assets that are consistent with our target
sold unencumbered by the Marriott brand). These profile of upper-upscale and luxury properties in hard
changes were effective as of December 29, 2001. We to duplicate urban, convention and resort locations.
have also completed the renegotiation of the manage- However, we cannot be certain as to the size or timing
ment agreements on our four Swissôtel management of acquisition opportunities or of our ability to obtain
contracts, and have the ability to terminate two man- transaction financing.
agement agreements immediately and the remaining We will continue to pursue opportunities to dispose of
two over the next five years. We believe that the modi- non-core assets that are not consistent with our portfolio
fications to the Swissôtel agreements together with our strategy. During 2003, we expect to continue to have dis-
revised agreements with Marriott International will cussions with potential buyers for certain of our non-core
enhance our ability to dispose of our non-core assets hotels.We believe that, if consummated, sales of non-core
more efficiently. properties transactions could result in net proceeds of
As part of the renegotiation with Marriott between $100 million to $250 million.We intend to use
International, we also reduced the amount of working the proceeds from dispositions to repay debt, though we
capital required and expanded an existing agreement could also elect to invest in our current portfolio or to
that allowed us to fund furniture, fixtures and equipment acquire additional hotels. However, there can be no assur-
expenditures as incurred from one account that we con- ance that these dispositions will occur.
trol rather than depositing funds into individual escrow Cash provided by Operations. During 2002, our
accounts for each hotel. As a result, an additional cash provided by operations increased by $91 million
$125 million in cash became available for our general when compared to 2001.The increase over the prior year
use effective July 25, 2002. At that time, approximately is partly due to an agreement we negotiated with
$75 million of funds returned to us were previously held Marriott International under which $50 million in cash
in furniture, fixtures and equipment escrows to fund became available to us because of a reduction in working
capital expenditures.While we continue to be obligated capital requirements under our revised management
to fund capital expenditures as such expenditures are agreements and the use of $208 million of operating cash
approved by us, this modification has enabled us to use in 2001 for the purchase of the lessee interests previously
the available funds for general corporate purposes. leased to Crestline.The overall increase in cash provided
We will continue to maintain higher than normal by operations was partially offset by the declining operat-
cash balances in 2003 because we believe that the war in ing results at the hotels during 2002.
Iraq could adversely affect the economy and in particu- Cash used in Investing Activities. Based on our
lar the lodging industry, which would result in further assessment of the current operating environment and
decline in our operations.We believe that increased to conserve capital, we continued our disciplined
operating performance levels, specifically increased levels approach to capital expenditures during 2002. As a
of business travel demand, would signal an opportunity result, renewal and replacement capital expenditures
to lower our cash balances through debt prepayments or at our properties have decreased by approximately
H O S T M A R R I OT T 2 0 0 2
21
24. $60 million, or 29%, when compared to the same price of $214 million, which included the assumption
period in 2001. Despite these decreases, we have of $97 million of mortgage debt.
focused on property maintenance and selected improve- We completed the sale of the Ontario Airport
ments designed to maintain appropriate levels of quality. Marriott on January 24, 2003 for $26 million to the
As a result of the changes in our agreements with Westbrook Fund IV Acquisitions, LLC. We used the
Marriott International, approximately $75 million of proceeds of this sale to retire certain of our debt.
funds previously held in escrow accounts for capital The following table summarizes significant invest-
expenditures at certain properties has been returned to ing activities which were completed during the first
us. On June 14, 2002, we acquired the Boston Marriott quarter of 2003 and for the years 2002 and 2001
Copley Place in Boston, Massachusetts for a purchase (in millions):
TRANSACTION SALE/(INVESTMENT)
DATE DESCRIPTION OF TRANSACTION PRICE
2003
January Sale of Ontario Airport Marriott $26
2002
January Development of the 295-room Golf Lodge at The Ritz-Carlton, Naples (75)
June Purchase of the 1,139-room Boston Marriott Copley Place (214)
2001
December Sale of Vail Marriott Mountain Resort and the Pittsburgh City Center Marriott 65
June Addition of a spa facility at the Marriott Harbor Beach Resort (8)
Purchase of minority ownership interest(1)
June (60)
April Addition of a spa facility at The Ritz-Carlton, Naples (25)
Purchase of 100% of the voting interest in Rockledge and Fernwood(2)
March (2)
(1) The limited partner interests relate to seven full-service hotels.
(2) The voting interests were previously held by the Host Marriott Statutory Employee/Charitable Trust. Prior to the acquisition, we held a 95%
non-voting interest in each company. As a result of the acquisition, we consolidated three full-service hotels, one of which was transferred to the
lender in 2002.
Cash used in Financing Activities. During 2002, payments, as well as future amounts due at maturity
the cash used in financing activities primarily consisted or upon redemption, we may from time to time pur-
of principal repayments on debt of $63 million and chase senior notes for cash through open market pur-
preferred stock dividend payments of $35 million. chases, privately negotiated transactions or by
On December 20, 2002, we announced that our Board conducting a tender offer. Our Board of Directors has
of Directors had declared a dividend of $0.625 per authorized the repurchase of up to $150 million of
share of preferred stock, which was paid on January 15, our senior notes from the proceeds of any disposi-
2003 to shareholders of record on December 31, 2002. tions. Repurchases of debt, if any, will depend on pre-
We did not declare a dividend on our common stock vailing market conditions, our liquidity requirements,
during 2002. contractual restrictions and other factors. During
We are aware that certain of our outstanding senior March 2003, we purchased $8 million of our 9.25%
notes are currently trading at a discount to their senior notes at par.
respective face amounts. To reduce future cash interest
H O S T M A R R I OT T 2 0 0 2
22
25. The following table summarizes significant financing activity, except for the credit facility, payment of dividends,
and non-cash equity transactions (all of which are discussed below), during the first quarter of 2003 and for the years
2002, 2001 and (in millions):
TRANSACTION TRANSACTION
DATE DESCRIPTION OF TRANSACTION AMOUNT
2003
January Partial prepayment of Ritz-Carlton, Naples and Buckhead mortgage loan $ (17)
March Retired a portion of 9.25% senior note due in 2007 (8)
2002
Purchase of interest rate cap(2)
January (3)
Retired 9.5% senior notes due in 2005(1)
September (13)
2001
Issuance of Class C cumulative redeemable preferred stock(5)
March 143
Proceeds from the Canadian mortgage loan(4)
August 97
Retired Ritz-Carlton, Amelia Island mortgage loan(4)
August (88)
October Retired San Antonio Marriott Riverwalk mortgage loan (17)
Issuance of Series H senior notes(3)
December 450
(1) We retired the remaining $13 million of these senior notes at approximately 101% of par.We recorded a nominal loss on the retirement.
(2) This agreement caps the floating interest rate at 14% for the swap agreement for the Series I senior notes.
(3) Proceeds from the Series H senior notes were used to repay the outstanding balance on the credit facility. Additionally, we entered into an interest
rate swap agreement with regards to this principal balance, as discussed below.These notes were exchanged in June 2002 for Series I senior notes
on a one-for-one basis and are substantially identical to the Series H senior notes and are freely transferable by the holders.
(4) A Canadian subsidiary entered into a financing agreement pursuant to which it borrowed $97 million.The Calgary Marriott,Toronto Airport
Marriott,Toronto Marriott Eaton Centre and Toronto Delta Meadowvale hotels serve as collateral.The proceeds from this financing were used
to refinance existing indebtedness on these hotels, as well as to repay the $88 million mortgage note on The Ritz-Carlton, Amelia Island hotel.
(5) On March 27, 2001, we issued approximately 6.0 million shares of 10% Class C cumulative redeemable preferred stock for net proceeds of
$143 million. Holders of the Class C Preferred Stock are entitled to receive cumulative cash distributions at a rate of 10% per year of the
$25 per unit liquidation preference.
Debt. As of December 31, 2002, our total consoli- enter into additional interest rate swap agreements
dated debt was approximately $5.6 billion. We have related to some of our fixed rate debt.
$136 million in principal amortization and debt maturi- In March 2003, we purchased $8 million of 9.25%
ties due during 2003 and $2.4 billion in principal senior notes due in 2007 at par and immediately retired
amortization and debt maturities due over the next five the debt. On January 30, 2003, we prepaid $17 million
years. The weighted average interest rate of all our debt of mortgage debt related to two of our Ritz-Carlton
is approximately 7.9% and our current average maturity properties. On September 16, 2002, we called $13 mil-
is 5.5 years. Additionally, 90% of our debt has a fixed lion of 9.5% senior notes due in May 2005 at 101% of
rate of interest as of December 31, 2002. Over time, we par.We immediately retired the notes and recorded an
expect to increase the proportion of floating rate debt extraordinary loss of $150,000 on the early retirement of
in our capital structure to 20% to 25% of our total the debt, which is presented in the statement of opera-
debt, although there can be no assurances that we will tions, net of $6 million extraordinary gain on extin-
be able to achieve this result on terms acceptable to us. guishment of debt related to the transfer of the St. Louis
In December 2001, in order to take advantage of low, Marriott Pavilion to the lender.
short-term interest rates, we entered into an interest On June 6, 2002, we entered into a credit facility
rate swap agreement (described in “Derivative Instru- that provides an aggregate revolving loan commitment
ments”) to convert the fixed rate of the Series H senior amount of up to $400 million ($300 million of which is
notes, which were subsequently exchanged into Series I available currently, with the balance becoming available to
senior notes, to a floating rate. In January 2002, we the extent that our leverage ratio meets a specified level.)
entered into a separate cap arrangement to limit our The credit facility has an initial three-year term with an
exposure to interest rate increases on this floating rate option to extend for an additional year if certain condi-
swap (described in “Derivative Instruments”). We con- tions are met. Interest on borrowings under the credit
tinue to evaluate our mix of fixed rate and floating rate facility will be calculated based on a spread over LIBOR
debt and, to the extent we deem it appropriate, we may ranging from 2.50% to 3.75%.The rate will vary based on
H O S T M A R R I OT T 2 0 0 2
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26. our leverage ratio.We are required to pay a quarterly reduced operating levels which followed the September 11,
commitment fee that will vary based on the amount of 2001 terrorist attacks and the economic slowdown, the
unused capacity under the credit facility. Currently, the ratings on these senior notes and the senior notes issued
commitment fee is .55% on an annual basis for available by many other lodging companies were downgraded
capacity and .10% on additional capacity. As of March 1, and placed on negative credit watch. On February 13,
2003, we have not drawn on the credit facility. 2003, Standard and Poor’s downgraded its rating on our
In addition to the customary affirmative and negative senior debt from BB- to B+. At the same time Standard
covenants and restrictions, the credit facility contains & Poor’s also downgraded its rating on our preferred
covenants that require us to maintain leverage ratios stock from B- to CCC+. The other rating agency
below specified levels as well as interest, fixed charges affirmed our rating, but if operating results continue to
and unsecured interest coverage ratios above specified decline, they will be more likely to downgrade their
levels. While we are currently in compliance with these rating on our debt. While we have no significant senior
maintenance covenants, our current forecasts indicate note maturities until 2005, if operations were to decline
that we may fail to meet certain of these ratios during further, or if our credit ratios do not otherwise improve,
the second quarter of 2003. As a result, we expect to our senior notes could be downgraded further. If we
modify the financial covenants in our credit facility. We were unable to subsequently improve our credit ratings,
do not have any amounts outstanding under the credit our cost to issue additional senior notes, to refinance
facility in advance of seeking a modification, and we this debt as it comes due or to issue additional preferred
believe that this will facilitate us in reaching an agree- stock would likely increase.
ment with our lenders with regard to such a modifica- All of our mortgage debt is recourse solely to specific
tion. There can be no assurances, however, that we will, assets except for fraud, misapplication of funds and other
in fact, reach such an agreement. In addition, any addi- customary recourse provisions.We have thirty assets that
tional covenants could have an impact on our ability to are secured by mortgage debt.Twelve of these assets are
conduct our operations. secured by mortgage debt that contains restrictive
Under the terms of the senior notes indenture and covenants that require the mortgage servicer or lender to
the credit facility, our ability to incur indebtedness is retain and hold in escrow the cash flow after debt service
subject to restrictions and the satisfaction of various when it declines below specified operating levels.The
conditions, including an EBITDA-to-cash interest cov- impact of these covenants is discussed below.
erage ratio of at least 2.0 to 1.0. Beginning in the third Eight of our hotel properties secure a $609 million
quarter of 2002, we have not met this interest coverage mortgage loan that is the sole asset of a trust that issued
ratio incurrence test. As a result, our ability to incur commercial mortgage pass-though certificates, which
indebtedness is limited to indebtedness specifically per- we refer to as the CMBS Loan. These hotels securing
mitted under the credit facility and the senior notes the CMBS Loan are the New York Marriott Marquis,
indenture, such as borrowings under the credit facility the San Francisco Airport Hyatt Regency, the
and borrowings in connection with a refinancing of Cambridge Hyatt Regency, the Reston Hyatt Regency,
existing debt. Our failure to meet this interest coverage and the Swissôtels in Boston, New York, Atlanta and
ratio also restricts our ability to pay dividends on our Chicago, which we refer to as the CMBS Portfolio.
common and preferred equity, except to the extent The CMBS Loan contains a provision that requires the
necessary to maintain our status as a REIT. We are cur- mortgage servicer to retain the excess cash from the
rently considering several options to improve our inter- CMBS Portfolio after payment of debt service if net
est coverage. These options could include, among cash flow after payment of taxes, insurance, ground rent
others, retiring existing debt, swapping certain of our and reserves for furniture, fixtures and equipment for
fixed interest rate debt for lower floating interest rate the trailing twelve months declines below $96 million.
debt or acquiring properties with low or no indebted- Annual debt service is approximately $64 million. As a
ness. There can be no assurance that these options will result of the effect on operations of the September 11,
be available to us, or if available, that these options 2001 terrorist attacks and the economic slowdown, this
would be economically justifiable to implement. provision was triggered beginning in the third quarter
We have approximately $3.2 billion of senior notes of 2002 and will remain in effect until the CMBS
outstanding that are currently rated by Moody’s and Portfolio generates the necessary minimum cash flow
Standard & Poor’s. As a result of the significantly for two consecutive quarters, at which point, the cash
H O S T M A R R I OT T 2 0 0 2
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27. that has been escrowed will be returned to us. As of in a separate agreement with a different counterparty,
December 31, 2002, approximately $10 million of cash we purchased an interest rate cap for $3 million with
has been escrowed. Additional amounts will be the same notional amount which caps the floating
escrowed, and these amounts may be significant. There interest rate at 14%.
can be no assurance that the CMBS Portfolio will reach Our Canadian subsidiaries entered into financing
the minimum cash flow for the required period of time agreements pursuant to which they borrowed $96.6 mil-
so that the cash will be released. lion due August 2006 at a variable rate of LIBOR plus
On July 12, 2002, we modified the terms of the 2.75%. Since the mortgage loan on these Canadian
mortgage debt secured by our four Canadian properties. properties is denominated in U.S. Dollars and the func-
Under the terms of this modification, we have agreed tional currency of the Canadian subsidiary is the
to escrow the excess cash flow from these hotels on a Canadian Dollar, we purchased derivative instruments
retroactive basis effective December 29, 2001. To the for hedging of the foreign currency investment. Addi-
extent that cash flow available for debt service for the tionally, we purchased a separate interest rate cap relat-
twelve months ended March 28, 2003 is insufficient to ing to $48.3 million of the debt for approximately
achieve a specified debt-service coverage level, some or $400,000 which effectively capped the interest rate at
all of the escrowed excess cash flow will be applied to 10.75%. See “Quantitative and Qualitative Disclosure
the outstanding balance of this debt. Thereafter, excess about Market Risk,” for additional information on
cash flow will continue to be applied to the outstanding these derivative instruments.
balance to the extent necessary to achieve the specified
level of debt service coverage. As of December 31, L E A S E O B L I G AT I O N S
2002, approximately $7 million of cash is escrowed in HPT Leases. Prior to 1997, we divested certain limited-
connection with this provision. The majority of the bal- service hotel properties through the sale and leaseback
ance will be applied to the outstanding balance of the of 53 Courtyard by Marriott properties and 18 Resi-
indebtedness and the balance of the escrow will be dence Inn properties to Hospitality Properties Trust, or
released to us. Thereafter, we do not expect to be HPT. As part of the REIT conversion, the Courtyard
required to apply additional amounts of excess cash and Residence Inn properties were subleased to sub-
flow to the outstanding balance of the debt. However, if sidiaries of Crestline. The properties are managed by
actual results fall short of the current forecast, additional Marriott International under long-term management
amounts may be escrowed, which would result in addi- agreements. Rent payable by Crestline under the
tional principal repayments being made. non-cancelable subleases consists of the minimum rent
Derivative Instruments. Historically, our debt has payable under the HPT leases plus an additional per-
primarily been fixed rate including all of our previous centage rent based upon sales levels and is guaranteed
series of senior notes. We have increased the amount by Crestline up to a maximum amount of $30 million.
of our exposure to variable rate instruments with the Other Lease Activities. We have lease and sublease
issuance of our Series H senior notes, which were activity relating to our former restaurant operations
subsequently exchanged into Series I senior notes, for which we remain either directly or contingently
by using a derivative product. On December 20, 2001, liable. As of December 31, 2002, the expected sublease
we entered into an interest rate swap agreement, rental income for the restaurant operations exceeded
maturing in January 2007. Under the swap, we receive our lease liability. For a more detailed discussion of
fixed-rate payments at 9.5% and pay floating-rate our lease obligations, see Note 9 to the consolidated
payments based on one-month LIBOR plus 4.5% on financial statements.
a $450 million notional amount. On January 4, 2002,
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