DiamondRock Hospitality Company Reports Second Quarter 2016 Results

BETHESDA, Md., Aug. 5, 2016

Second Quarter 2016 Highlights

• Net Income: Net income was $44.2 million and earnings per diluted share was $0.22.
• Comparable RevPAR: RevPAR was $197.52, a 0.8% increase from the comparable period of 2015.
• Comparable Hotel Adjusted EBITDA Margin: Hotel Adjusted EBITDA margin was 35.85%, an increase of 11 basis points from the comparable period of 2015.
• Adjusted EBITDA: Adjusted EBITDA was $84.1 million, an increase of 3.7% from 2015.
• Adjusted FFO: Adjusted FFO was $63.1 million and Adjusted FFO per diluted share was $0.31.
• Credit Facility: The Company amended its senior unsecured revolving credit facility, increasing the capacity to $300 million, decreasing pricing and extending the maturity date to May 2020.
• Term Loan: The Company closed on a new five-year $100 million senior unsecured term loan.
• Courtyard Fifth Avenue Loan Repayment: The Company repaid the $48.1 million mortgage loan secured by the Courtyard Fifth Avenue.
• Hotel Dispositions: The Company sold the Orlando Airport Marriott for proceeds of approximately $67 million and the Hilton Minneapolis for proceeds of approximately $143 million.
• Dividends: The Company declared a dividend of $0.125 per share during the second quarter, which was paid on July 12, 2016.

Recent Developments

• Hotel Disposition: The Company sold the Hilton Garden Inn Chelsea/New York City for proceeds of approximately $65 million on July 7, 2016.

Mark W. Brugger, President and Chief Executive Officer of DiamondRock Hospitality Company, stated, "The Company has successfully executed on our strategic priority of increasing liquidity and financial flexibility, with $400 million in financing activity and approximately $275 million in hotel dispositions in recent months. We expect to end the year with over $200 million in corporate cash, no outstanding borrowings on our credit facility and a net debt to Adjusted EBITDA ratio of 2.7 times. We are well positioned to deploy capital opportunistically in response to future market dislocations, including through share repurchases. During the second quarter, our team and operators were highly effective in identifying cost efficiencies that resulted in an impressive Hotel Adjusted EBITDA margin of 36 percent. The continued benefit of these same initiatives enables the Company to maintain Adjusted EBITDA and Adjusted FFO guidance despite our more cautious outlook for revenue growth on weaker business travel trends."

Operating Results      

Please see "Non-GAAP Financial Measures" attached to this press release for an explanation of the terms "EBITDA," "Adjusted EBITDA," "Hotel Adjusted EBITDA Margin," "FFO" and "Adjusted FFO"and a reconciliation of these measures to net income. Comparable operating results include our 2015 acquisitions for all periods presented and exclude our 2016 dispositions for all periods presented. See "Reconciliation of Comparable Operating Results" attached to this press release for a reconciliation to historical amounts.

For the quarter ended June 30, 2016, the Company reported the following: