1998 Annual Report - Four Seasons Hotels and Resorts

More documents

Recommendations

Info

CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITIONYears ended December 31, 1998 and 1997(In thousands of dollars) 1998 1997C ASH PROVIDED BY ( USED IN):Operations $ 74,961 $ 64,794Financing:Long-term debt, including current portion:Issued 45,562 106,823Repaid (10,461) (219,747)Issuance of shares (note 11) 2,423 120,625Other (678) (948)Cash provided by financing 36,846 6,753Capital investments:Increase in long-term receivables (68,476) (38,535)Decrease in long-term receivables 2,178 2,648Hotel investments (21,921) (8,369)Disposal of hotel investments 12,781 13,000Purchase of fixed assets (13,885) (10,508)Investment in trademarks, trade names and management contracts (19,819) (9,343)Other assets (7,179) (7,170)Cash used in capital investments (116,321) (58,277)Dividends paid (3,502) (3,180)Increase (decrease) in cash (8,016) 10,090Increase (decrease) in cash due to unrealized foreign exchange gain (loss) 272 (149)Cash and cash equivalents, beginning of year 25,335 15,394Cash and cash equivalents, end of year $ 17,591 $ 25,335See accompanying notes to consolidated financial statements.C ONSOLIDATED STATEMENTS OF DEFICITCONSOLIDATED STATEMENTS OF RETAINED EARNINGS (DEFICIT)Years ended December 31, 1998 and 1997(In thousands of dollars) 1998 1997Deficit, beginning of year $ (54,961) $ (92,278)Net earnings 69,702 40,770Dividends declared (3,505) (3,453)Retained earnings (deficit), end of year $ 11,236 $ (54,961)See accompanying notes to consolidated financial statements.64Four Seasons Hotels Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTSYears ended December 31, 1998 and 1997(In thousands of dollars except per share amounts)Four Seasons Hotels Inc. (“FSHI”) is incorporated under the Business Corporations Act of the Province of Ontario and,through its subsidiaries, is engaged in the management of, and the investment in, hotel, resort and vacation ownershipproperties throughout the world (note 16). (FSHI and its subsidiaries are collectively referred to as the “Corporation.”)At December 31, 1998, the Corporation managed 42 hotels and resorts, one vacation ownership property and hadvarious projects under construction or development, of which the Corporation had an equity interest in seven hotels andresorts under management, one vacation ownership property and five projects under construction. The Corporation earnsmanagement and other related fees under long-term management contracts based generally on a percentage of totalrevenues and operating profits of the managed properties.1. S I G N I F I C A N T A C C O U N T I N G P O L I C I E S:The Corporation’s accounting policies and its standards of financial disclosure comply with accounting principles that aregenerally accepted in Canada. The significant accounting policies are summarized below:(a) Principles of consolidation:The Corporation consolidates all of its wholly-owned subsidiaries, including its primary operating subsidiaries – FourSeasons Hotels Limited and FSR International Hotels Limited (“Regent”) (formerly Regent International Hotels Limited).The Corporation consolidates its 100% leasehold interests in the Four Seasons Hotel Vancouver and The Pierre NewYork, and until its disposition on January 1, 1998, the Corporation also proportionately consolidated its hotel jointventure, The Ritz-Carlton Hotel Chicago (25%) (note 5(b)).(b) Accounting for investments in hotel partnerships and corporations:The Corporation accounts for its investments in hotel partnerships and corporations by the cost method because eitherthe percentage ownership and structure does not give the Corporation significant influence over these investments or theinvestments were acquired with the intention that they be disposed of in the foreseeable future.The Corporation recognizes revenue on its investment in these partnerships and corporations when profit distributionsare receivable from the partnerships or corporations.In the event of a decline in value of an investment in the equity of a hotel partnership or corporation that is otherthan temporary, the investment is written down to the estimated recoverable amount.(c) Translation of foreign currencies:Foreign currency balances of the Corporation and of foreign operations designated as integrated are translated into domesticcurrencies at the rates of exchange on the balance sheet date for monetary items, and at the rates of exchange on the date oftransaction for non-monetary items. The resulting translation gains or losses are included in the determination of net earnings,except for gains or losses related to foreign currency denominated long-term debt designated as hedges of investments inself-sustaining foreign operations, which are deferred and included in a separate component of shareholders’ equity.Translation gains or losses on foreign exchange forward contracts designated as hedges of long-term receivables areincluded in income in the same period as the related translation losses or gains on the hedged receivables. Any premiumsor discounts on the forward contracts are amortized to interest expense over the terms of the contracts.Revenues and expenses denominated in foreign currencies are translated at the rates of exchange on the dates of thetransactions, except for revenues hedged by foreign exchange forward contracts, which are translated at the contract rates.65Four Seasons Hotels Inc.
Page 5 and 6:
focus at all levels, including corp
Page 7 and 8:
FOUR SEASONS MANAGEMENT COMMITTEE R
Page 9 and 10:
We strongly believe in promotion fr
Page 11 and 12:
improve our returns on capital and
Page 13 and 14:
51485245545355475046 49575856616059
Page 16 and 17: ANNUAL INFORMATION FORM(continued)I
Page 18 and 19: ANNUAL INFORMATION FORM(continued)S
Page 20 and 21: ANNUAL INFORMATION FORM(continued)A
Page 24 and 25: ANNUAL INFORMATION FORM(continued)F
Page 26 and 27: ANNUAL INFORMATION FORM(continued)V
Page 30 and 31: ANNUAL INFORMATION FORM(continued)F
Page 32 and 33: ANNUAL INFORMATION FORM(continued)M
Page 58 and 59: ANNUAL INFORMATION FORM(continued)C
Page 60 and 61: ANNUAL INFORMATION FORM(continued)C
Page 62 and 63: MANAGEMENT’S RESPONSIBILITY FOR F
Page 64 and 65: CONSOLIDATED BALANCE SHEETSDecember
Page 68 and 69: NOTES TO CONSOLIDATED FINANCIAL STA
Page 84 and 85: CORPORATE GOVERNANCEG E N E R A LOn
Page 86 and 87: CORPORATE GOVERNANCE(continued)C O
Page 88: FOUR SEASONS HOTELS AND RESORTS FOU
show all

1998 Annual Report - Four Seasons Hotels and Resorts

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?