Expect Full Year 2019 Target Hospitality
Adjusted EBITDA(1) of $175 Million to $180 Million, Driven by
Expected 2019 Revenues of $340 Million to $350 Million
Nearly 90% of Target Hospitality Estimated 2019
Revenue Under Contract, Providing Strong Visibility
Target Hospitality Full Year 2018 Adjusted
EBITDA(1) Expected to be Consistent with Prior Outlook
Platinum Eagle Acquisition Corp. (Nasdaq: EAGL) (“Platinum
Eagle”), a publicly traded special purpose acquisition company, and
Target Logistics Management, LLC (“Target Lodging”), the largest
provider of flexible accommodation and hospitality services in the
U.S., today announced that full year 2018 Adjusted EBITDA(1) for
Target Hospitality Corp. (“Target Hospitality”) is expected to be
consistent with the previously announced outlook and raised the
full year 2019 outlook for Target Hospitality. Target Hospitality
is the entity expected to be created by the previously announced
business combination (the “Business Combination”) of Platinum
Eagle, Target Lodging and RL Signor Holdings, LLC (“Signor”).
Target Lodging recently announced its renewal of multi-year
contracts with four major customers, providing for an estimated
aggregate contract value of over $200 million, including estimated
incremental revenue of over $45 million. The renewals extended the
duration of the existing contracts by a minimum of two years, while
expanding the scope of services to include Target Lodging’s full
suite of accommodations along with additional room commitments
across its Permian Basin lodging network. With the expected
incremental revenue, in combination with Target Hospitality’s
planned integration of Signor and other anticipated operational
enhancements, Target Lodging has increased its outlook for Target
Hospitality’s anticipated 2019 results.
Brad Archer, President and Chief Executive Officer of Target
Lodging, stated, “We are thrilled with the positive momentum in our
business and our increased 2019 outlook for Target Hospitality. The
integration of Signor is progressing as anticipated, alongside
continued execution of our planned capital and operational
enhancements throughout our expansive lodging network. Our durable
customer contracts provide us with great visibility into our future
performance and underpin the stability and resiliency of our
business. As a result, we are confident in our market opportunity
and look forward to delivering on Target Hospitality’s anticipated
objectives in 2019.”
Preliminary Results and Outlook for Target
Hospitality
Adjusted EBITDA for full year 2018 for Target Hospitality is
expected to be consistent with the expectations for Target
Hospitality 2018 Adjusted EBITDA(1) as previously disclosed on
November 14, 2018.
On a pro forma basis, after giving effect to the Business
Combination, Target Hospitality’s full year 2019 revenue is
expected to be in the range of $340 million to $350 million,
compared to the prior estimate of $303.5 million, and Target
Hospitality’s full year 2019 Adjusted EBITDA(1) is expected to be
in the range of $175 million to $180 million, compared to the prior
estimate of $165.9 million. These increases are supported by the
strong visibility provided by nearly 90% of Target Hospitality’s
estimated 2019 revenue under contract.
Cautionary Note Regarding Expected Full Year 2018 Results for
Target Hospitality.
The expected full year 2018 Adjusted EBITDA results for Target
Hospitality are preliminary, unaudited and subject to completion,
reflect management’s estimates based solely upon information
available to it as of the date of this press release. Such
preliminary expectations are subject to the closing of the full
year 2018 and finalization of year-end financial and accounting
procedures (which have yet to be completed) and should not be
viewed as a substitute for complete, full-year financial statements
prepared in accordance with generally accepted accounting
principles in the United States of America, or GAAP. Target
Lodging’s auditors have not audited, reviewed, compiled, or
performed any procedures with respect to such expected 2018 results
for purposes of their inclusion in this press release , and
accordingly, they have not expressed an opinion or provided any
other form of assurance with respect thereto for the purpose of
this press release.
About Platinum Eagle Acquisition Corp.
Platinum Eagle was formed for the purpose of effecting a merger,
share exchange, asset acquisition, share purchase, reorganization
or similar business combination with one or more businesses.
Platinum Eagle raised $325 million in its initial public offering
and began trading on Nasdaq in January 2018. Its Class A ordinary
shares, units and warrants trade under the ticker symbols EAGL,
EAGLU and EAGLW, respectively.
About Target Lodging
Founded in 1978, Target Lodging is the largest vertically
integrated specialty rental and hospitality services company in the
United States. The company is principally focused
on building, owning and operating housing
communities across several end markets, including oil, gas,
energy infrastructure and government. Target Lodging provides
cost-effective and customized specialty rental accommodations,
culinary services, and hospitality solutions, including site
design, construction, operations, security, housekeeping, catering,
concierge services, and health and recreation facilities as part of
its integrated housing and hospitality
communities. Target Lodging was named by Inc. magazine in 2012
and 2013 as one of “America’s Fastest Growing Private
Companies.” Target Lodging has been an Algeco company since
2013.
Forward-Looking Statements
Certain statements made in this release are "forward looking
statements" within the meaning of the "safe harbor" provisions of
the United States Private Securities Litigation Reform Act of 1995.
When used in this press release, the words "estimates,"
"projected," "expects," "anticipates," "forecasts," "plans,"
"intends," "believes," "seeks," "may," "will," "should," "future,"
"propose" and variations of these words or similar expressions (or
the negative versions of such words or expressions) are intended to
identify forward-looking statements. These forward-looking
statements are not guarantees of future performance, conditions or
results, and involve a number of known and unknown risks,
uncertainties, assumptions and other important factors, many of
which are outside Platinum Eagle's, Target Lodging’s or Signor’s
control, that could cause actual results or outcomes to differ
materially from those discussed in the forward-looking statements.
Important factors, among others, that may affect actual results or
outcomes include the inability to complete the business combination
(including due to the failure to receive required shareholder
approvals, or the failure of other closing conditions); the
inability to recognize the anticipated benefits of the proposed
business combination; the inability to meet Nasdaq listing
standards; costs related to the business combination; Target
Hospitality’s ability to manage growth; Target Hospitality’s
ability to execute its business plan and meet its projections;
Target Hospitality’s ability to identify, consummate and integrate
acquisitions; rising costs adversely affecting Target Hospitality’s
profitability; potential litigation involving Platinum Eagle,
Target Lodging, Signor, or after the closing, Target Hospitality,
and general economic and market conditions impacting demand for
Target Lodging’s products and services, and in particular economic
and market conditions in the oil industry in the markets in which
Target Hospitality operates. None of Platinum Eagle, Target Lodging
or Signor undertakes any obligation to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise, except as required by law.
(1) Non-GAAP Financial Measures
This press release includes projected Adjusted EBITDA, which is
a measurement not calculated in accordance with U.S. generally
accepted accounting principles (“GAAP”). Platinum Eagle, Target
Lodging and Signor believe that this non-GAAP measure is useful to
investors for two principal reasons. First, they believe this
measure assists investors in comparing performance over various
reporting periods on a consistent basis by removing from operating
results the impact of items that do not reflect core operating
performance. Second, it is a key metric used by management to
assess financial performance and may (subject to the limitations
described below) enable investors to compare the performance of the
combined company to its competitors. Platinum Eagle, Target Lodging
and Signor believe that the use of this non-GAAP financial measure
provides an additional tool for investors to use in evaluating
ongoing operating results and trends. This non-GAAP measure should
not be considered in isolation from, or as an alternative to,
financial measures determined in accordance with GAAP. Other
companies may calculate Adjusted EBITDA and other non-GAAP
financial measures differently, and therefore Adjusted EBITDA used
herein may not be directly comparable to similarly titled measures
of other companies.
Adjusted EBITDA is defined as net income (loss) before income
tax expense, net interest expense, depreciation and amortization
adjusted for non-cash items considered non-core to business
operations including net currency losses, change in fair value of
contingent considerations, goodwill and other impairment charges,
restructuring costs and other non-recurring expenses. Pro forma
Adjusted EBITDA includes an annualized estimate of standalone
public company costs.
Information reconciling forward-looking Adjusted EBITDA to a
GAAP financial measure is unavailable without unreasonable effort.
Target Lodging is not able to provide a reconciliation of forward
looking Adjusted EBITDA to GAAP financial measures because certain
items required for such reconciliations are outside of the
company’s control and/or cannot be reasonably predicted, such as
the provision for income taxes. Preparation of such reconciliations
would require a forward-looking balance sheet, statement of income
and statement of cash flow, prepared in accordance with GAAP, and
such forward-looking financial statements are unavailable to the
company without unreasonable effort. The company provides a range
for its Adjusted EBITDA forecast that it believes will be achieved,
however it cannot accurately predict all the components of the
Adjusted EBITDA calculation. Target Lodging’s auditors have not
audited, reviewed, compiled, or performed any procedures with
respect to such forward-looking information for purposes of their
inclusion in this press release , and accordingly, they have not
expressed an opinion or provided any other form of assurance with
respect thereto for the purpose of this press release. Such
forward-looking information is for illustrative purposes only and
should not be relied upon as being necessarily indicative of future
results.
Additional Background on Recently Announced Business
Combination with Platinum Eagle Acquisition Corp.
On November 13, 2018, Platinum Eagle, Target Lodging and Signor
announced definitive merger agreements for a business
combination to create the largest provider of specialty rental
accommodations with premium catering and value-add hospitality
services in the U.S. Under the terms of the business combination,
Target Lodging and Signor will become wholly-owned subsidiaries of
Platinum Eagle, which will be renamed Target Hospitality Corp., and
the combined company’s common stock will be listed on the Nasdaq
Stock Market under the ticker symbol “TH” following the
closing.
The business combination is expected to be completed in the
first quarter of 2019, pending Platinum Eagle shareholder approval
and the satisfaction of other customary closing conditions.
Additional information about the business combination, as well as
Target Lodging’s and Signor’s operations and historical financial
information is contained in Platinum Eagle’s registration statement
on Form S-4 (the “Registration Statement”) initially filed with the
U.S. Securities and Exchange Commission (“SEC”) on November 13,
2018. The Registration Statement includes a proxy
statement/prospectus that will be both the proxy statement to be
distributed to Platinum Eagle's shareholders in connection with
Platinum Eagle's solicitation of proxies for shareholder approval
of the business combination and other matters as described in the
Registration Statement, as well as the prospectus relating to the
offer and sale of certain securities to be issued in the business
combination. After the Registration Statement is declared
effective, Platinum Eagle will mail a definitive proxy
statement/prospectus and other relevant documents to its
shareholders as of a record date to be established for voting on
the business combination. Platinum Eagle's shareholders and other
interested persons are advised to read the preliminary proxy
statement/prospectus included in the Registration Statement and the
amendments thereto and, when available, the definitive proxy
statement/prospectus, as these materials contain important
information about Target Lodging, Signor, Platinum Eagle and the
business combination. Shareholders and other interested persons
will also be able to obtain copies of the proxy
statement/prospectus and other documents filed with the SEC,
without charge, once available, at the SEC's web site at
www.sec.gov, or by directing a request to: Platinum Eagle
Acquisition Corp., 2121 Avenue of the Stars, Suite 2300, Los
Angeles, California, Attention: Eli Baker, President, Chief
Financial Officer and Secretary, (310) 209-7280.
The description of the business combination contained herein
is only a summary and is qualified in its entirety by reference to
the definitive agreements relating to the business combination,
copies of which were filed by Platinum Eagle with the SEC on Form
8-K on November 19, 2018.
Participants in the Solicitation
Platinum Eagle and its directors and executive officers may be
deemed participants in the solicitation of proxies from Platinum
Eagle's shareholders with respect to the business combination. A
list of the names of those directors and executive officers and a
description of their interests in Platinum Eagle is contained in
the proxy statement/prospectus for the business combination, which
was filed with the SEC and is available free of charge at the SEC's
web site at www.sec.gov, or by directing a request to Platinum
Eagle Acquisition Corp., 2121 Avenue of the Stars, Suite 2300, Los
Angeles, California, Attention: Eli Baker, President, Chief
Financial Officer and Secretary, (310) 209-7280. Additional
information regarding the interests of such participants are
contained in the proxy statement/prospectus for the business
combination.
Each of Target Lodging and Signor and its directors and
executive officers may also be deemed to be participants in the
solicitation of proxies from the shareholders of Platinum Eagle in
connection with the business combination. A list of the names of
such directors and executive officers and information regarding
their interests in the business combination are contained in the
proxy statement/prospectus for the business combination.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190207005461/en/
InvestorsNarinder SahaiorRodny
Nacier832-702-8009IR@targetlodging.comMediaJason Chudoba,
646-277-1249Jason.Chudoba@icrinc.comorElyse Gentile,
646-677-1823Elyse.Gentile@icrinc.com
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