Morgans Hotel Group Reports First Quarter 2009 Results

NEW YORK--(BUSINESS WIRE)--May. 4, 2009-- Morgans Hotel Group Co. (NASDAQ: MHGC) (“MHG”) today reported financial results for the first quarter ended March 31, 2009.
Highlights
Revenue per available room (“RevPAR”) for System-Wide Comparable Hotels decreased 36.0% in constant dollars in the first quarter from the comparable period in 2008.
Adjusted EBITDA for the first quarter was $7.1 million, a decrease of 67% from the comparable period in 2008.
EBITDA at System-Wide Comparable Hotels during the first quarter decreased by 63% from the comparable period in 2008, a rate of 1.6 times the related RevPAR percentage change.
MHG achieved a 21% reduction in operating expenses at System-Wide Comparable Hotels and a 16% reduction in corporate expenses in the first quarter of 2009 from the comparable period in 2008.
Additional restructuring initiatives were implemented in January and March 2009. Through our multi-phase contingency plans implemented in the beginning of 2008, we estimate that we have reduced hotel operating expenses and corporate expenses by approximately $20 million and $10 million, respectively, on an annualized basis.
With the completion of the redesigned Mondrian Los Angeles and Morgans properties in September 2008, MHG has no significant deferred capital expenditure requirements at its owned hotels.
In April, Hard Rock opened a new and expanded Joint Concert Hall and added approximately 65,000 square feet of meeting space. The north tower consisting of 490 rooms is scheduled to open in the summer of 2009 and the casino expansion and south tower consisting of 374 rooms are projected to open in late 2009 or early 2010.
Boston Ames and Mondrian SoHo are currently targeted to open in the fourth quarter of 2009 or early 2010.