EXHIBIT 99.1
[GAYLORD ENTERTAINMENT LOGO]
GAYLORD ENTERTAINMENT CO. REPORTS FIRST QUARTER EARNINGS
GAYLORD HOTELS POSTS DOUBLE-DIGIT GROWTH IN REVPAR AND TOTAL REVPAR
TOTAL REVPAR SURPASSES $300 FOR GAYLORD HOTELS
NASHVILLE, Tenn. (May 2, 2006) -- Gaylord Entertainment Co. (NYSE: GET) today
reported its financial results for the first quarter of 2006.
For the first quarter ended March 31, 2006:
- Consolidated revenue increased 13.1 percent to $242.2 million
from $214.0 million in the same period last year, led by
strong revenue growth in the hospitality segment.
- Income from continuing operations was $11.4 million, or $0.28
per share, compared to a loss from continuing operations of
$9.0 million, or a loss of $0.23 per share in the prior-year
quarter. The increase in income from continuing operations is
due to strong growth in operating income, a $5.4 million
non-recurring gain related to the collection of a note
receivable held by ResortQuest previously considered to be
uncollectible, and a $2.2 million pre-tax net unrealized gain
in the value of the Company's Viacom stock investment and
related derivatives in the first quarter of 2006 compared to a
pre-tax net unrealized loss of $11.5 million in the first
quarter of 2005.
- Hospitality segment total revenue grew 16.1 percent to $165.5
million, compared to $142.5 million in the prior-year quarter,
driven by strong revenue growth at both the Opryland and Texan
properties. Gaylord Hotels revenue per available room(1)
("RevPAR") and total revenue per available room(2) ("Total
RevPAR") increased 16.8 percent and 16.3 percent,
respectively, compared to the first quarter of 2005.
- Adjusted EBITDA(3) was $43.0 million compared to $31.8 million
in the prior-year quarter.
- Consolidated Cash Flow(4) ("CCF") increased 48.7 percent to
$53.9 million in the first quarter of 2006 compared to $36.2
million in the same period last year. CCF for the first
quarter of 2006 included a non-recurring $5.4 million gain
related to the collection of a note receivable held by
ResortQuest, previously considered to be uncollectible.
"This was a great quarter for the Company largely driven by the success of
Gaylord Hotels, our unmatched network of convention properties, which delivered
robust growth in revenue and CCF during the quarter," said Colin V. Reed,
chairman and chief executive officer of Gaylord Entertainment. "Our strong
pipeline of advance bookings is clear evidence of the growing national awareness
of our brand, as well as the delivery of a superior experience for our customers
across all of our hotels. Hospitality segment Total RevPAR topped $300 for the
first time, illustrating our success at attracting higher value customers who
take advantage of our diverse outside-the-room offerings."
2
"This quarter also highlights the outstanding performance of the Gaylord
Opryland, which grew revenues by more than 30 percent and CCF by more than 75
percent compared to the first quarter of 2005. The Gaylord National, scheduled
to open its doors at the end of the first quarter of 2008, has achieved to date,
cumulative net definite room nights booked approaching 600,000, a resounding
affirmation of the Gaylord brand and business model."
SEGMENT OPERATING RESULTS
HOSPITALITY
Key components of the Company's hospitality segment performance in the first
quarter of 2006 include:
- Gaylord Hotels Total RevPAR increased 16.3 percent to $301.96,
compared to $259.53 in the first quarter of 2005; Gaylord
Hotels RevPAR increased 16.8 percent to $128.08 compared to
$109.64 in the prior-year quarter. Very strong advance
bookings across its system of hotels and solid transient
demand allowed the Company to yield high RevPAR and Total
RevPAR in the first quarter of 2006. In the first quarter,
occupancy increased 5.8 percentage points while ADR increased
8.3 percent compared to the same period last year.
- CCF increased 32.7 percent to $52.3 million in the first
quarter of 2006 compared to $39.4 million in the same period
last year. CCF margins for the hospitality segment increased
395 basis points to 31.6 percent from 27.7 percent in the
prior-year quarter.
- Gaylord Hotels' same-store net definite bookings for all
future years, excluding Gaylord National, increased 37.2
percent to 225,300 net definite room nights booked in the
first quarter of 2006.
- Gaylord National booked an additional 25,300 net definite room
nights in the first quarter of 2006, bringing cumulative net
definite room nights to 572,000.
- Gaylord Hotels' rotational bookings were strong at 46.3
percent in the first quarter of 2006, reflecting the continued
loyalty of our meeting planners and our success at leveraging
our network of hotels.
"Our hospitality properties continue to grow both occupancy and ADR, exhibiting
our ability to achieve an increasingly higher yield for our hotel network. The
Gaylord Opryland has re-emerged as a top convention hotel, benefiting from our
strong dedication to customer service and from a favorable response to our
ongoing room renovations," said Reed. "Meeting planners, transient guests and
local residents have all become strong supporters of our convention hotels,
best-in-class customer service, and award-winning dining and entertainment
offerings. Solid demand for advance bookings is coming from the high-quality
customers who take advantage of the multitude of amenities our hotels have to
offer. Furthermore, our ability to rotate customers across all Gaylord Hotels
enables us to secure long-term, multi-year, multi-property bookings, providing
even greater earnings visibility and better yield across the network."
At the property level, Gaylord Opryland achieved revenues of $65.8 million in
the first quarter of 2006, a 31.9 percent increase compared to the prior-year
quarter. RevPAR increased 27.3 percent to $110.73, driven by a 7.5 percentage
point occupancy increase and a 15.1 percent increase in ADR. Total RevPAR grew
32.5 percent to $254.71 in the first quarter of 2006 compared to $192.30 in the
prior-year quarter, based on the hotel's success in attracting higher quality
customers who contribute to the significant increases in ADR and
outside-the-room
3
spending. CCF grew 76.5 percent to $17.3 million versus $9.8 million in the
first quarter of 2005. CCF margin increased 665 basis points to 26.3 percent
from 19.6 percent in the prior-year quarter. CCF margin growth was a result of
greater operating leverage due to strong ADR growth and improved expense
management across the hotel. Opryland's multi-year room renovation program,
which completed its first phase in the fourth quarter of 2005, is scheduled to
resume in June and continue into the fourth quarter of 2006 with the renovation
of an additional 428 rooms, or approximately 25,300 room nights. To complete the
room renovation program, the Company expects to take approximately 79,250 room
nights out of service at various times in 2007. No rooms were taken out of
service during the first quarter of 2006.
Gaylord Palms posted a solid performance in the first quarter of 2006,
increasing revenues slightly to $50.8 million. Gaylord Palms generated RevPAR
growth of 2.6 percent to $164.23, driven by an 8.9 percent increase in ADR
partially offset by a 5.2 percentage point decrease in occupancy. Coming off of
a tremendous first quarter in 2005 with occupancy above 90 percent, the Palms
posted a solid performance in a competitive market by maintaining high levels of
occupancy and ADR in a typically high demand period for the hotel. Total RevPAR
increased to $401.58, above the $400 mark for the first time since the hotel's
opening in 2002. CCF was flat to the prior-year quarter at $18.8 million in the
first quarter of 2006. This resulted in a decrease in CCF margin for the hotel
of 57 basis points to 36.9 percent from 37.5 percent in the first quarter of
2005.
Gaylord Texan revenues increased 15.9 percent to $46.9 million in the first
quarter of 2006 compared to $40.5 million in the prior-year quarter. RevPAR
increased 19.6 percent to $140.27 from $117.24 in the first quarter of 2005,
driven by a 12.1 percentage point increase in occupancy and a 1.9 percent
increase in ADR. Total RevPAR grew 15.9 percent to $344.77 in the first quarter
of 2006, from $297.54 in the same period last year. Strong gains in RevPAR and
Total RevPAR were driven by a significant increase in occupancy levels and
continued strength in outside-the-room spending from our group, transient and
local customers. CCF increased 51.8 percent to a record $15.8 million from $10.4
million in the first quarter of 2005, resulting in a CCF margin of 33.7 percent,
or a 797 basis point increase over the first quarter of 2005. Strong
flow-through results at the hotel were driven, in part, by greater operational
efficiencies achieved on incremental occupancy.
DEVELOPMENT UPDATE
Construction continues to progress on the Gaylord National, with advance
bookings in the first quarter of 2006 growing by 15.2 percent compared to the
prior-year quarter. The National booked an additional 25,300 room nights in the
first quarter of 2006, bringing cumulative net definite room nights booked for
the property to approximately 572,000. The National continues to set production
records for Gaylord Hotels two years from its opening at the end of the first
quarter of 2008.
"Construction on the Gaylord National is progressing as expected and our
customers are eagerly awaiting the completion of the finest convention hotel on
the East Coast," said Reed. "Advance bookings remain impressive for this
property and, in March, we requested additional economic incentives from Prince
George's County in order to help fund our 500-room expansion. We expect to hear
a decision from Prince George's County in the near future and will update our
shareholders on any developments. We remain disciplined on managing development
costs and are confident that this project will deliver very strong returns for
our shareholders."
4
In the first quarter of 2006, Gaylord incurred $30.4 million in capital
expenditures related to the construction of the Gaylord National.
RESORTQUEST
ResortQuest revenues from continuing operations increased 2.3 percent in the
first quarter of 2006 to $59.8 million, compared to $58.5 million in the
prior-year quarter. RevPAR increased 2.8 percent to $89.74, driven by an 8.7
percent increase in ADR while occupancy decreased 3.4 percentage points to 57.8
percent in the first quarter of 2006. Operating income was $2.1 million compared
to $1.8 million in the first quarter of 2005. ResortQuest CCF was $10.9 million
compared to $5.6 million in the first quarter of 2005. ResortQuest CCF in the
first quarter of 2006 includes a non-recurring $5.4 million gain related to the
collection of a note receivable previously considered to be uncollectible.
In the first quarter of 2006, ResortQuest had 15,795 units under exclusive
management, excluding units reflected in discontinued operations. ResortQuest
operating statistics for all periods presented exclude units in discontinued
markets and units out of service, which includes certain units damaged by
hurricanes. Operating results for ResortQuest's non-core markets that are being
exited are reflected in Gaylord's consolidated financial results as discontinued
operations, net of taxes, for all periods presented.
"First quarter ResortQuest performance across most of our markets came in as
expected," said Reed. "While we experienced softness in demand in our Florida
markets and in Whistler, in addition to softness in our real estate brokerage
operations in Florida, the rest of our markets generally performed as expected.
Early indications from the website launch in February are encouraging as
bookings through that channel are on the rise."
OPRY AND ATTRACTIONS
Opry and Attractions segment revenues increased to $16.8 million in the first
quarter of 2006 compared to $12.9 million in the first quarter of 2005. Opry and
Attractions reported an operating loss of $1.4 million for the period compared
to an operating loss of $2.2 million in the first quarter of 2005. CCF increased
to $0.1 million in the first quarter of 2006 from a CCF loss of $0.9 million in
the prior-year quarter.
"We continue to expand our partnerships and distribution agreements, leveraging
the significant brand recognition of the Grand Ole Opry," said Reed. "We remain
very excited about our current partnerships, including our partnership with
Great American Country ("GAC"), which places the Grand Ole Opry Live into a
potential 40 million homes in the U.S."
CORPORATE AND OTHER
Corporate and Other operating loss totaled $12.4 million in the first quarter of
2006 compared to an operating loss of $9.8 million in the same period last year.
Corporate and Other operating losses in the first quarter of 2006 increased over
the prior year period in part due to the expensing of stock options. Corporate
and Other CCF in the first quarter of 2006 decreased to a loss of $9.4 million
compared to a loss of $7.9 million in the prior-year quarter.
BASS PRO SHOPS
5
For the quarter ended March 31, 2006, Gaylord's equity income from its
investment in Bass Pro Group, LLC was $2.6 million.
LIQUIDITY
As of March 31, 2006, the Company had long-term debt outstanding, including
current portion, of $607.2 million and unrestricted and restricted cash and
short term investments of $67.4 million. $554.4 million of the Company's $600.0
million credit facility remains undrawn at the end of the first quarter of 2006,
which included $15.6 million in letters of credit.
Gaylord is currently evaluating financing alternatives to fund Gaylord
National's planned expansion costs and increased construction costs.
Alternatives may include the issuance of debt or equity, economic incentives,
the sale of assets, or a combination thereof.
OUTLOOK
The following outlook is based on current information as of May 2, 2006. The
Company does not expect to update guidance until next quarter's earnings
release. However, the Company may update its full business outlook or any
portion thereof at any time for any reason.
"Gaylord Hotels entered 2006 with strong bookings, which led to an excellent
first quarter. Our cost control measures, another area of emphasis, allowed a
high percentage of these revenues to flow to the bottom line. We expect to
continue this forward momentum in Total RevPAR and RevPAR in subsequent 2006
quarters, as we attract the best customers, who take advantage of our varied
outside-the-room offerings. We are, therefore, raising our 2006 full year
guidance to reflect incremental additional top line growth and the benefits of
our expense control measures."
"ResortQuest is off to a solid start, but we have some caution about our Florida
markets for the balance of the year," continued Reed. "The overall market's pace
of bookings and real estate sales are soft in comparison to prior years. We have
conducted research specific to previous ResortQuest customers who have not yet
booked and have found that vacationers, by and large, remain interested in
booking but have yet to do so. Therefore, the booking window is being compressed
and at this time our visibility into third quarter 2006 for ResortQuest is
somewhat limited. As a result, we are lowering our guidance to $16 to $21
million in CCF for the year, which includes the $5.4 million collection of a
note receivable recognized in the first quarter of 2006."
Gaylord's 2006 outlook reflects approximately 25,300 room nights out of service
due to the room renovation at Gaylord's Opryland Hotel.
<Table>
<Caption>
2006 2006
PRIOR NEW
- ---------------------------------- ------------------- -------------------
CONSOLIDATED REVENUE $924 -- 961 Million $924 - $961 Million
CONSOLIDATED CASH FLOW
Gaylord Hotels $158 - $161 Million $163 -- 168 Million
ResortQuest $21 - $26 Million $16 -- 21 Million
Opry and Attractions $10 - $11 Million $10 -- 11 Million
Corporate and Other ($37 - $35 Million) $(37 -- 35 Million)
------------------- -------------------
Consolidated CCF $152 - $163 Million $152 -- 165 Million
6
GAYLORD HOTELS ADVANCE BOOKINGS 1.3 -- 1.4 Million 1.3 -- 1.4 million
GAYLORD HOTELS REVPAR 7% - 9% 8% - 10%
GAYLORD HOTELS TOTAL REVPAR 7% - 9% 8% - 10%
</Table>
WEB CAST AND REPLAY
Gaylord Entertainment will hold a conference call to discuss this release today
at 10 a.m. ET. Investors can listen to the conference call over the Internet at
www.gaylordentertainment.com. To listen to the live call, please go to the
Investor Relations section of the website (Investor Relations/Presentations,
Earnings, and Webcasts) at least 15 minutes prior to the call to register,
download, and install any necessary audio software. For those who cannot listen
to the live broadcast, a replay will be made available shortly after the call
and will run for at least 30 days.
ABOUT GAYLORD ENTERTAINMENT
Gaylord Entertainment (NYSE: GET), a leading hospitality and entertainment
company based in Nashville, Tenn., owns and operates three industry-leading
brands - Gaylord Hotels (www.gaylordhotels.com), its network of upscale,
meetings-focused resorts, ResortQuest (www.resortquest.com), the nation's
largest vacation rental property management company, and the Grand Ole Opry
(www.opry.com), the weekly showcase of country music's finest performers for 80
consecutive years. The Company's entertainment brands and properties include the
Radisson Hotel Opryland, Ryman Auditorium, General Jackson Showboat, Gaylord
Springs, Wildhorse Saloon, and WSM-AM. For more information about the Company,
visit www.gaylordentertainment.com.
This press release contains statements as to the Company's beliefs and
expectations of the outcome of future events that are forward-looking statements
as defined in the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are subject to risks and uncertainties that could
cause actual results to differ materially from the statements made. These
include the risks and uncertainties associated with economic conditions
affecting the hospitality business generally, the timing of the opening of new
facilities, increased costs associated with building and developing new hotel
facilities, business levels at the Company's hotels, risks associated with
ResortQuest's business, the Company's ability to successfully integrate and
achieve operating efficiencies at ResortQuest, and the ability to obtain
financing for new developments. The Company's ability to achieve forecasted
results for its ResortQuest business depends upon levels of occupancy at
ResortQuest units under management, returning damaged units to service on a
timely basis and the successful roll-out of new ResortQuest technology
initiatives. Other factors that could cause operating and financial results to
differ are described in the filings made from time to time by the Company with
the Securities and Exchange Commission. The Company does not undertake any
obligation to release publicly any revisions to forward-looking statements made
by it to reflect events or circumstances occurring after the date hereof or the
occurrence of unanticipated events.
1 The Company calculates revenue per available room ("RevPAR") for its
hospitality segment by dividing room sales by room nights available to
guests for the period. The Company calculates revenue per available
room ("RevPAR") for its ResortQuest segment by dividing gross lodging
revenues by room nights available to guests for the period. The
Company's ResortQuest segment revenue represents a portion of the gross
lodging revenues based on the services provided by ResortQuest.
ResortQuest segment revenue and operating expenses include certain
reimbursed management contract expenses incurred in the period of $10.6
million and $9.9 million for the three months ended March 31, 2006 and
2005, respectively.
7
2 The Company calculates total revenue per available room ("Total
RevPAR") by dividing the sum of room sales, food & beverage, and other
ancillary services revenue by room nights available to guests for the
period.
3 Adjusted EBITDA (defined as earnings before interest, taxes,
depreciation, amortization, as well as certain unusual items) is used
herein because we believe it allows for a more complete analysis of
operating performance by presenting an analysis of operations separate
from the earnings impact of capital transactions and without certain
items that do not impact our ongoing operations such as the effect of
the changes in fair value of the Viacom stock we own and changes in the
fair value of the derivative associated with our secured forward
exchange contract and gains on the sale of assets. In accordance with
generally accepted accounting principles, the changes in fair value of
the Viacom stock and derivatives are not included in determining our
operating income (loss). The information presented should not be
considered as an alternative to any measure of performance as
promulgated under accounting principles generally accepted in the
United States (such as operating income, net income, or cash from
operations), nor should it be considered as an indicator of overall
financial performance. Adjusted EBITDA does not fully consider the
impact of investing or financing transactions, as it specifically
excludes depreciation and interest charges, which should also be
considered in the overall evaluation of our results of operations. Our
method of calculating adjusted EBITDA may be different from the method
used by other companies and therefore comparability may be limited. A
reconciliation of adjusted EBITDA to net income is presented in the
Supplemental Financial Results contained in this press release.
4 As discussed in footnote 3 above, Adjusted EBITDA is used herein as
essentially operating income plus depreciation and amortization.
Consolidated Cash Flow (which is used in this release as that term is
defined in the Indentures governing the Company's 8% and 6.75% senior
notes) also excludes the impact of pre-opening costs, the non-cash
portion of the naming rights and Florida ground lease expense,
non-recurring ResortQuest integration charges which when added to other
expenses related to the merger do not exceed $10 million, stock option
expense, the non-cash gain on the sale of the songs.com domain name,
the non-cash gain or loss on the disposal of other fixed assets, and
adds (subtracts) other gains (losses) (including the $5.4 million gain
on the collection of a note receivable held by ResortQuest) and
dividends received from our minority investment in RHAC, L.L.C., which
owns the Aston Waikiki Beach Hotel. The Consolidated Cash Flow measure
is one of the principal tools used by management in evaluating the
operating performance of the Company's business and represents the
method by which the Indentures calculate whether or not the Company can
incur additional indebtedness (for instance in order to incur certain
additional indebtedness, Consolidated Cash Flow for the most recent
four fiscal quarters as a ratio to debt service must be at least 2 to
1). The calculation of these amounts as well as a reconciliation of
those amounts to net income or segment operating income is included as
part of the Supplemental Financial Results contained in this press
release.
<Table>
<Caption>
INVESTOR RELATIONS CONTACTS: MEDIA CONTACTS:
- ---------------------------------- --------------------
David Kloeppel, CFO Elliot Sloane
Gaylord Entertainment Sloane & Company
(615) 316-6101 (212) 446-1860
dkloeppel@gaylordentertainment.com esloane@sloanepr.com
~OR~
Key Foster, VP Treasury
& Investor Relations
Gaylord Entertainment
(615) 316-6132
kfoster@gaylordentertainment.com
~OR~
Josh Hochberg
Sloane & Company
(212) 446-1892
jhochberg@sloanepr.com
</Table>
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
(In thousands, except per share data)
THREE MONTHS ENDED
MAR. 31
----------------------
2006 2005
--------- ---------
Revenues (a) $ 242,155 $ 214,013
Operating expenses:
Operating costs (a) 152,227 136,106
Selling, general and administrative (b) 45,866 45,140
Preopening costs 1,062 943
Depreciation and amortization 21,302 20,937
--------- ---------
Operating income 21,698 10,887
--------- ---------
Interest expense, net of amounts capitalized (17,830) (18,091)
Interest income 707 579
Unrealized loss on Viacom stock (13,235) (17,163)
Unrealized gain on derivatives 15,392 5,637
Income from unconsolidated companies 2,756 1,472
Other gains and (losses), net (c) 6,090 2,450
--------- ---------
Income (loss) before provision (benefit) from income taxes 15,578 (14,229)
Provision (benefit) for income taxes 4,208 (5,183)
--------- ---------
Income (loss) from continuing operations 11,370 (9,046)
Income from discontinued operations, net of taxes 1,789 189
--------- ---------
Net income (loss) $ 13,159 $ (8,857)
========= =========
Basic net income (loss) per share:
Income (loss) from continuing operations $ 0.28 $ (0.23)
Income from discontinued operations, net of taxes $ 0.05 $ 0.01
--------- ---------
Net income (loss) $ 0.33 $ (0.22)
========= =========
Fully diluted net income (loss) per share:
Income (loss) from continuing operations $ 0.27 $ (0.23)
Income from discontinued operations, net of taxes $ 0.05 $ 0.01
--------- ---------
Net income (loss) $ 0.32 $ (0.22)
========= =========
Weighted average common shares for the period:
Basic 40,311 39,983
Fully-diluted 41,395 39,983
(a) Includes certain ResortQuest reimbursed management contract expenses
incurred in the period of $10,561 and $9,926 for the three months ended
March 31, 2006 and 2005, respectively.
(b) Includes non-cash lease expense of $1,664 and $1,638 for the three months
ended March 31, 2006 and 2005, respectively, related to the effect of
recognizing the Gaylord Palms ground lease expense and other property lease
expense on a straight-line basis. Also includes non-cash expense of $0 and
$64 for the three months ended March 31, 2006 and 2005, respectively,
related to the effect of recognizing the Naming Rights Agreement for the
Gaylord Entertainment Center on a straight-line basis.
(c) Includes a non-recurring $5.4 million gain related to the collection of a
note receivable, held by ResortQuest, previously considered to be
uncollectible for the three months ended March 31, 2006.
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited
(In thousands)
<Table>
<Caption>
MAR. 31, DEC. 31,
2006 2005
---------- ----------
ASSETS
Current assets:
Cash and cash equivalents - unrestricted $ 36,975 $ 59,797
Cash and cash equivalents - restricted 30,414 23,651
Short-term investments - -
Trade receivables, net 61,115 37,168
Deferred financing costs 26,865 26,865
Deferred income taxes 8,562 8,861
Other current assets 35,070 29,298
Current assets of discontinued operations 1,239 2,649
--------------------------
Total current assets 200,240 188,289
Property and equipment, net of accumulated depreciation 1,438,827 1,404,419
Intangible assets, net of accumulated amortization 26,520 27,828
Goodwill 174,442 178,088
Indefinite lived intangible assets 40,315 40,315
Investments 419,117 429,295
Estimated fair value of derivative assets 236,464 220,430
Long-term deferred financing costs 21,751 29,144
Other long-term assets 16,586 14,136
Long-term assets of discontinued operations 436 646
--------------------------
Total assets $2,574,698 $2,532,590
==========================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt and capital lease obligations $ 1,819 $ 1,825
Accounts payable and accrued liabilities 203,455 190,692
Current liabilities of discontinued operations 1,551 3,650
--------------------------
Total current liabilities 206,825 196,167
Secured forward exchange contract 613,054 613,054
Long-term debt and capital lease obligations, net of current portion 605,358 598,475
Deferred income taxes 179,749 177,652
Estimated fair value of derivative liabilities 4,500 1,994
Other long-term liabilities 91,975 96,564
Long-term liabilities and minority interest of discontinued operations 108 117
Stockholders' equity 873,129 848,567
--------------------------
Total liabilities and stockholders' equity $2,574,698 $2,532,590
==========================
</Table>
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL RESULTS
Unaudited
(In thousands, except operating metrics)
<Table>
<Caption>
ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND
AMORTIZATION ("ADJUSTED EBITDA") AND CONSOLIDATED CASH FLOW ("CCF")
RECONCILIATION: THREE MONTHS ENDED MAR. 31,
-------------------------------------------------
2006 2005
----------------------- -----------------------
$ MARGIN $ MARGIN
----------------------- -----------------------
Consolidated
REVENUE $ 242,155 100.0% $ 214,013 100.0%
NET INCOME (LOSS) $ 13,159 5.4% $ (8,857) -4.1%
Loss (income) from discontinued operations, net of taxes (1,789) -0.7% (189) -0.1%
(Benefit) provision for income taxes 4,208 1.7% (5,183) -2.4%
Other (gains) and losses, net (6,090) -2.5% (2,450) -1.1%
(Income) loss from unconsolidated companies (2,756) -1.1% (1,472) -0.7%
Unrealized (gain) loss on derivatives (15,392) -6.4% (5,637) -2.6%
Unrealized loss (gain) on Viacom stock 13,235 5.5% 17,163 8.0%
Interest expense, net 17,123 7.1% 17,512 8.2%
----------------------- -----------------------
OPERATING (LOSS) INCOME 21,698 9.0% 10,887 5.1%
Depreciation & amortization 21,302 8.8% 20,937 9.8%
----------------------- -----------------------
ADJUSTED EBITDA 43,000 17.8% 31,824 14.9%
Pre-opening costs 1,062 0.4% 943 0.4%
Non-cash lease expense 1,664 0.7% 1,638 0.8%
Non-cash naming rights for Gaylord Arena - 0.0% 64 0.0%
Non-recurring ResortQuest integration charges (1) - 0.0% 1,078 0.5%
Stock Option expense 1,646 0.7% - 0.0%
Other gains and (losses), net (2) 6,090 2.5% 2,450 1.1%
Gain on sale of songs.com - 0.0% (926) -0.4%
Gain on sale of assets - 0.0% (825) -0.4%
Loss on disposal of fixed assets 253 0.1% - 0.0%
Dividends received from RHAC, LLC 172 0.1% - 0.0%
----------------------- -----------------------
CCF $ 53,887 22.3% $ 36,246 16.9%
======================= =======================
Hospitality segment
REVENUE $ 165,464 100.0% $ 142,501 100.0%
OPERATING INCOME 33,389 20.2% 21,009 14.7%
Depreciation & amortization 16,140 9.8% 15,844 11.1%
Pre-opening costs 1,062 0.6% 943 0.7%
Non-cash lease expense 1,575 1.0% 1,638 1.1%
Stock Option expense 169 0.1% - 0.0%
Other gains and (losses), net 2 0.0% 12 0.0%
----------------------- -----------------------
CCF $ 52,337 31.6% $ 39,446 27.7%
======================= =======================
ResortQuest segment
REVENUE $ 59,848 100.0% $ 58,508 100.0%
OPERATING INCOME 2,107 3.5% 1,800 3.1%
Depreciation & amortization 2,734 4.6% 2,693 4.6%
Non-recurring ResortQuest integration charges (1) - 0.0% 1,078 1.8%
Non-cash lease expense 89 0.1% - 0.0%
Stock Option expense 343 0.6% - 0.0%
Other gains and (losses), net (2) 5,430 9.1% 2 0.0%
Dividends received from RHAC, LLC 172 0.3% - 0.0%
----------------------- -----------------------
CCF $ 10,875 18.2% $ 5,573 9.5%
======================= =======================
Opry and Attractions segment
REVENUE $ 16,765 100.0% $ 12,857 100.0%
OPERATING LOSS (1,371) -8.2% (2,156) -16.8%
Depreciation & amortization 1,414 8.4% 1,398 10.9%
Stock Option expense 24 0.1% - 0.0%
Other gains and (losses), net (266) -1.6% (105) -0.8%
Loss on disposal of fixed assets 253 1.5% - 0.0%
----------------------- -----------------------
CCF $ 54 0.3% $ (863) -6.7%
======================= =======================
Corporate and Other segment
REVENUE $ 78 $ 147
OPERATING LOSS (12,427) (9,766)
Depreciation & amortization 1,014 1,002
Non-cash naming rights for Gaylord Arena - 64
Stock Option expense 1,110 -
Other gains and (losses), net 924 2,541
Gain on sale of songs.com - (926)
Gain on sale of assets - (825)
-------------------- -----------------------
CCF $ (9,379) $ (7,910)
==================== =======================
(1) Under the terms of Gaylord's bond indentures and credit facility, non
recurring costs and expenses related to the merger of ResortQuest and Gaylord
Entertainment in Nov. 2003 are excluded from the calculation of Consolidated
Cash Flow ("CCF"). Non-recurring ResortQuest integration charges include
severance payments, rebranding expenses, technology integration charges and
other related non-recurring expenses related to the merger, not to exceed a
total of $10 million.
(2) Includes a non-recurring $5.4 million gain related to the collection of a
note receivable, held by ResortQuest, previously considered to be uncollectible
for the three months ended March 31, 2006.
GAYLORD ENTERTAINMENT COMPANY AND SUBSIDIARIES
SUPPLEMENTAL FINANCIAL RESULTS
Unaudited
(in thousands, except operating metrics)
----------------------------------
THREE MONTHS ENDED MAR. 31,
----------------------------------
2006 2005
------------- -------------
HOSPITALITY OPERATING METRICS:
GAYLORD HOSPITALITY SEGMENT
Occupancy 79.9% 74.1%
Average daily rate (ADR) $ 160.28 $ 147.93
RevPAR $ 128.08 $ 109.64
OtherPAR $ 173.88 $ 149.89
Total RevPAR $ 301.96 $ 259.53
Revenue $ 165,464 $ 142,501
CCF $ 52,337 $ 39,446
CCF Margin 31.6% 27.7%
GAYLORD OPRYLAND
Occupancy 77.6% 70.1%
Average daily rate (ADR) $ 142.78 $ 124.09
RevPAR $ 110.73 $ 86.96
OtherPAR $ 143.98 $ 105.34
Total RevPAR $ 254.71 $ 192.30
Revenue $ 65,757 $ 49,861
CCF $ 17,275 $ 9,785
CCF Margin 26.3% 19.6%
GAYLORD PALMS
Occupancy 85.1% 90.3%
Average daily rate (ADR) $ 193.09 $ 177.26
RevPAR $ 164.23 $ 160.10
OtherPAR $ 237.35 $ 238.16
Total RevPAR $ 401.58 $ 398.26
Revenue $ 50,816 $ 50,396
CCF $ 18,762 $ 18,896
CCF Margin 36.9% 37.5%
GAYLORD TEXAN
Occupancy 81.5% 69.4%
Average daily rate (ADR) $ 172.19 $ 168.96
RevPAR $ 140.27 $ 117.24
OtherPAR $ 204.50 $ 180.30
Total RevPAR $ 344.77 $ 297.54
Revenue $ 46,886 $ 40,462
CCF $ 15,811 $ 10,419
CCF Margin 33.7% 25.8%
NASHVILLE RADISSON AND OTHER (1)
Occupancy 70.5% 60.8%
Average daily rate (ADR) $ 90.28 $ 87.48
RevPAR $ 63.68 $ 53.20
OtherPAR $ 13.46 $ 12.16
Total RevPAR $ 77.14 $ 65.36
Revenue $ 2,005 $ 1,782
CCF $ 489 $ 346
CCF Margin 24.4% 19.4%
RESORTQUEST OPERATING METRICS:
RESORTQUEST SEGMENT (2)
Occupancy 57.8% 61.2%
ADR $ 155.13 $ 142.70
RevPAR $ 89.74 $ 87.30
Total Units 15,795 17,664
(1) Includes other hospitality revenue and expense
(2) Excludes units in discontinued markets and units out of service, including
units damaged by hurricanes.
GAYLORD ENTERTAINMENT COMPANY AND
SUBSIDIARIES
RECONCILIATION OF FORWARD-LOOKING
STATEMENTS
Unaudited
(in thousands, except operating metrics)
ADJUSTED EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION
AND AMORTIZATION ("ADJUSTED EBITDA") AND CONSOLIDATED
CASH FLOW ("CCF") RECONCILIATION:
Guidance Range
(Full Year 2006)
LOW HIGH
---------- ----------
Consolidated
ESTIMATED OPERATING INCOME (LOSS) $ 33,960 $ 46,960
Estimated Depreciation & amortization 89,200 89,200
---------- ----------
ESTIMATED ADJUSTED EBITDA $ 123,160 $ 136,160
Estimated Pre-opening costs 5,700 5,700
Estimated Non-cash lease expense 6,400 6,400
Estimated Stock Option Expense 6,900 6,900
Estimated Gains and (losses), net 9,840 9,840
---------- ----------
ESTIMATED CCF $ 152,000 $ 165,000
========== ==========
Hospitality segment
ESTIMATED OPERATING INCOME (LOSS) $ 83,400 $ 88,400
Estimated Depreciation & amortization 66,300 66,300
---------- ----------
ESTIMATED ADJUSTED EBITDA $ 149,700 $ 154,700
Estimated Pre-opening costs 5,700 5,700
Estimated Non-cash lease expense 6,400 6,400
Estimated Stock Option Expense 1,200 1,200
Estimated Gains and (losses), net - -
---------- ----------
ESTIMATED CCF $ 163,000 $ 168,000
========== ==========
ResortQuest segment
ESTIMATED OPERATING INCOME (LOSS) $ (4,200) $ 800
Estimated Depreciation & amortization 12,500 12,500
---------- ----------
ESTIMATED ADJUSTED EBITDA $ 8,300 $ 13,300
Estimated Stock Option Expense 1,500 1,500
Estimated Gains and (losses), net 6,200 6,200
---------- ----------
ESTIMATED CCF $ 16,000 $ 21,000
========== ==========
Opry and Attractions segment
ESTIMATED OPERATING INCOME (LOSS) $ 4,160 $ 5,160
Estimated Depreciation & amortization 5,600 5,600
---------- ----------
ESTIMATED ADJUSTED EBITDA $ 9,760 $ 10,760
Estimated Stock Option Expense 100 100
Estimated Gains and (losses), net 140 140
---------- ----------
ESTIMATED CCF $ 10,000 $ 11,000
========== ==========
Corporate and Other segment
ESTIMATED OPERATING INCOME (LOSS) $ (49,400) $ (47,400)
Estimated Depreciation & amortization 4,800 4,800
---------- ----------
ESTIMATED ADJUSTED EBITDA $ (44,600) $ (42,600)
Estimated Stock Option Expense 4,100 4,100
Estimated Gains and (losses), net 3,500 3,500
---------- ----------
ESTIMATED CCF $ (37,000) $ (35,000)
========== ==========
</Table>