Segments (Tables)

12 Months Ended

Dec. 31, 2017

Summarized Consolidated Financial Information by Segment

The table below shows summarized consolidated financial information by segment:

	For the years ended December 31,
	2017			2016			2015
	(in thousands)
Revenues
Owned Hotels	$	842,950		$	879,653		$	911,491
Franchise and management ⁽¹⁾		118,516			116,806			114,610
Segment revenues		961,466			996,459			1,026,101
Other fee-based revenues from franchise properties		27,511			25,150			23,204
Corporate and other ⁽²⁾		124,970			124,757			126,469
Intersegment elimination ⁽³⁾		(133,317	)		(140,112	)		(145,800	)
Total revenues	$	980,630		$	1,006,254		$	1,029,974
Adjusted EBITDA
Owned Hotels		250,344			279,536			314,278
Franchise and management		118,516			116,806			114,610
Segment Adjusted EBITDA		368,860			396,342			428,888
Corporate and other		(41,988	)		(35,964	)		(34,846	)
Adjusted EBITDA	$	326,872		$	360,378		$	394,042

⁽¹⁾

This segment includes intercompany fees which are charged to our owned hotels to reflect that certain functions, such as licensing and management, are included in the franchise and management segment. We charge a franchise fee of 4.5% of gross room revenues and a management fee of 2.5% of gross operating revenue for our owned hotels. These fees are charged to Owned Hotels and are eliminated in the accompanying consolidated financial statements.

⁽²⁾

Includes revenues related to our brand management programs and other cost reimbursements. The portions of these fees that are charged to our owned hotels, which totaled $68.2 million, $71.5 million and $75.1 million for the years ended December 31, 2017, 2016 and 2015, respectively, are eliminated in the accompanying consolidated financial statements. The franchise agreement we entered into with our owned hotels upon effectiveness of the IPO also includes a reservation fee of 2.0% of gross room revenues, which is reflected in corporate and other.

⁽³⁾

Includes management, license, franchise, BMF, Returns and other cost reimbursements totaling $133.3 million, $140.1 million and $145.8 million for the years ended December 31, 2017, 2016 and 2015, respectively. These fees are charged to owned hotels and are eliminated in the accompanying consolidated financial statements.

Reconciliation of Net Income (Loss) Attributable to Company to EBITDA and EBITDA to Adjusted EBITDA

The table below provides a reconciliation of net income (loss) attributable to La Quinta Holdings’ stockholders to EBITDA and EBITDA to Adjusted EBITDA for the years ended December 31, 2017, 2016 and 2015:

	For the years ended December 31,
	2017			2016			2015
	(in thousands)
Net income (loss) attributable to La Quinta Holdings' stockholders	$	151,965		$	(1,288	)	$	26,365
Interest expense		82,608			81,666			86,614
Income tax (benefit) expense		(111,556	)		493			22,487
Depreciation and amortization		149,951			147,996			167,920
Noncontrolling interests		162			185			347
EBITDA	$	273,130		$	229,052		$	303,733
Fixed asset impairment loss		1,178			104,258			50,121
(Gain) loss on sales		(3,665	)		(4,908	)		4,088
Loss on retirement of assets		2,485			—			445
Loss related to casualty disasters		1,557			3,051			1,824
Equity-based compensation		13,338			14,153			18,814
Amortization of software service agreements		9,514			9,050			8,343
Severance charges ⁽¹⁾		—			—			11,021
Retention plan⁽²⁾		11,384			—			—
Reorganization costs⁽²⁾		15,209			—			—
Other losses (gains), net ⁽³⁾		2,742			5,722			(4,347	)
Adjusted EBITDA	$	326,872		$	360,378		$	394,042

⁽¹⁾	Includes cash and non-cash charges relating to the departure of the Company’s former President and Chief Executive Officer.

⁽²⁾	Includes cash and non-cash costs associated with the Spin and Merger.

⁽³⁾	Other gains (losses), net primarily consists of net income (loss) attributable to the BMF (which, over time, runs at a break-even level, but may reflect a profit or loss from period to period), IRS legal defense costs and litigation reserve adjustments.

Reconciliation of Assets for Reportable Segments to Consolidated Amounts

The following table presents assets for our reportable segments, reconciled to consolidated amounts as of December 31, 2017, 2016 and 2015:

	2017		2016		2015
	(in thousands)
Total Assets
Owned Hotels	$	2,550,064	$	2,499,770	$	2,682,394
Franchise and management		201,548		198,832		192,284
Total segments assets		2,751,612		2,698,602		2,874,678
Corporate and other		201,484		193,921		111,166
Total	$	2,953,096	$	2,892,523	$	2,985,844

Reconciliation of Capital Expenditures for Reportable Segments to Consolidated Amounts

The following table presents capital expenditures for our reportable segments, reconciled to our consolidated amounts:

	For the years ended December 31,
	2017		2016		2015
	(in thousands)
Owned Hotels	$	194,892	$	123,996	$	82,139
Franchise and management		—		—		—
Total segment capital expenditures		194,892		123,996		82,139
Corporate and other		22,588		19,756		9,831
Total	$	217,480	$	143,752	$	91,970