Ultimate Escapes Reports Fourth Quarter and Full Year 2009 Results
Record Revenues of $37 million in 2009, an Increase of 64% Over 2008 Revenues
Ultimate Escapes, Inc. (OTCBB: ULEI and ULEI-W) (the “Company”), one of the world's largest luxury destination clubs, today announced its 2009 fourth quarter and full year financial results. For 2009, the Company reported record revenues of $37 million in 2009, an increase of 64% compared to 2008 revenue of $22.5 million. The Company reported a net loss of $13 million in 2009, a 44% improvement from the net loss in 2008 of $23.2 million. The reduction in net loss was principally driven by a 47% increase in club memberships and improved club operating efficiencies in 2009, leading to a 75% reduction in loss before other income (expenses).
“2009 was a landmark year for Ultimate Escapes. Despite a very difficult global economic environment, Ultimate Escapes added over 350 new club members, 18 new club destinations and 50 new club properties, all while improving member services and reducing operating costs”
- On September 15, 2009, Ultimate Escapes successfully closed the acquisition of Private Escapes, the third-largest destination club in the world, adding a third destination club (Premiere Club) to Ultimate Escapes’ growing portfolio of luxury destination clubs, and adding $49 million in new club properties and over 350 new club members to Ultimate Escapes.
- On October 29, 2009, the Company consummated the business combination of Ultimate Escapes Holdings and Secure America Acquisition Corporation and became the industry’s first public luxury destination club.
“2009 was a landmark year for Ultimate Escapes. Despite a very difficult global economic environment, Ultimate Escapes added over 350 new club members, 18 new club destinations and 50 new club properties, all while improving member services and reducing operating costs,” said President and Chief Executive Officer Jim Tousignant. “We successfully completed the acquisition of Private Escapes in September and completed a business combination with Secure America in October, making Ultimate Escapes the first and only pure-play public company destination club in the world. Record membership growth of 47% in 2009 has led to improved financial performance, with 64% revenue growth and EBITDA of $6.7 million in 2009.”
Fourth Quarter 2009 Results
For fourth quarter 2009, the Company reported quarterly revenue of $12.0 million, a 100% increase from $6.0 million in the prior-year quarter, primarily due to $3.75 million in member assessment fees earned in the fourth quarter of 2009 that were not earned in the prior-year quarter and also due to increased revenues from new members added as a result of the Private Escapes acquisition.
Net loss for the fourth quarter 2009 was $9.7 million, compared to $4.3 million in the prior-year quarter. Excluding $5.3 million of non-cash equity compensation expense resulting from acceleration of stock options at the closing of the business combination with Secure America in October 2009, and also excluding a $2.8 million impairment charge on assets held for sale, a $0.5 million loss on sale of property and equipment, and a $1.5 million gain related to contingent acquisition consideration in the fourth quarter 2009, net loss for fourth quarter 2009 was $2.6 million. EBITDA for fourth quarter 2009 was ($4.1) million, compared with ($0.4) million from the prior-year quarter. Depreciation and amortization expense for the fourth quarter 2009 was $2.6 million, up 73% from $1.5 million in the prior-year quarter as a result of the acquisition of Private Escapes. Interest expense for the fourth quarter 2009 was $3.0 million, a 25% increase from $2.4 million in the prior-year quarter as a result of the Private Escapes acquisition.
For a reconciliation of EBITDA to the most similar GAAP measure, see "Unaudited Operating Results using Adjusted GAAP Revenue Recognition and Adjusted EBITDA (in thousands)" below.
Full Year 2009 Results
For the full year 2009, the Company reported revenue of $37.0 million, a 64% increase from the prior year, primarily due to $12 million in assessment fees in 2009 that were not earned in 2008. EBITDA for the full year 2009 was $6.7 million, a $16.3 million increase from the prior year mainly due to the increased revenue contribution in 2009. Depreciation and amortization expense for 2009 was $5.5 million, up 23% from the prior year primarily due to the acquisition of Private Escapes. Interest expense for 2009 was $10.0 million, a 9% increase from the prior year as a result of the Private Escapes acquisition and a full year of interest related to debt incurred from the acquisition of certain properties in February 2008.
Net loss for 2009 was $13.0 million, compared to a net loss of $23.2 million, in 2008. Excluding $6.6 million of non-cash equity compensation expense, a $2.8 million impairment charge on assets held for sale, a $0.5 million loss on sale of property and equipment, and a $1.5 million gain related to contingent acquisition consideration in 2009, net loss for 2009 was $4.6 million.
Liquidity and Capital Resources
As of December 31, 2009, that Company had $7.1 million in cash and restricted cash and approximately $123.3 million of debt outstanding on its balance sheet. As of December 31, 2009, the Company had negative working capital of $32.7 million, compared to negative working capital of $8.9 million at December 31, 2008.
