Just as your pulse is checked during a routine physical, free cash flow is used as an indicator of a company's health. It equals the cash brought in from operations minus the money needed to pay the bills. Think about leftover money in your checking account after you pay this month's bills.

Investors and analysts see this leftover money as a gauge of a company's ability to perform. It is available for transactions such as handing out dividends and working on new products.

Some argue free cash flow is wrongly overshadowed by the emphasis often placed on earnings. Earnings numbers can be manipulated and don't always tell the whole story -- and earnings don't mean much if there's nothing left over after a company pays its expenses. Even if you bring in a six-figure salary, but no money left after paying the bills, are you in great financial shape?

You don't have to be Einstein to figure out free cash flow. To calculate the number, subtract the company's expenditures and dividends from its operating cash flow.

If the free cash flow is written in red ink, it doesn't necessarily signal curtains. This is common for young companies looking to grow. It also could be a result of heavy investments, which in the long run could be worth a standing ovation.

Home / Markets / Industries / Finance

Wednesday, July 30, 2008

Brazil - a Hot Spot for Counter-cyclical Hotel Investment, Reports Jones Lang LaSalle Hotels

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SAO PAULO, Brazil, July 30, 2008 /PRNewswire-FirstCall via COMTEX/ ----Jones Lang LaSalle Hotels published a report today that analyzes the largely underserved hotel market in Brazil. The country's strong domestic demand is boosting hotel fundamentals, and creating an abundance of investment opportunities.

"Brazil is one of the few countries in the world with a growing economy and it has received an investment grade rating from S&P and Fitch. As a result, foreign investment in Brazil is poised for growth, and the market is becoming increasingly attractive to institutional and private equity investors. The hotel sector will benefit from the growing economy and the increased inflow of foreign capital," said Arthur Adler, managing director and CEO-Americas, Jones Lang LaSalle Hotels.

"Brazil has been insulated from the economic slowdown felt elsewhere in the world. Investing in Brazil's hotel real estate presents a countercyclical investment opportunity compared to the U.S. and Western Europe," said Kristina Paider, senior vice president of research and marketing for Jones Lang LaSalle Hotels.

"Brazil's tourism ministry predicts that the number of international tourists will nearly double by 2010. The government's $235 billion investment program, targeting improvements in roads and airports, will address infrastructure bottlenecks and in turn, make tourism more attractive. Additionally, Brazil's exposure as host to the 2014 FIFA Soccer World Cup will stimulate increased touch points for most of the world," Paider said.

"New hotel development presents the main opportunity for investors as there is little product to buy, and the mid-market and budget sectors in secondary markets are particularly robust," said Ricardo Mader, a new executive vice president for Jones Lang LaSalle Hotels in Brazil. "Brazil has a total of 40 cities with more than one million residents; 14 of which are metropolitan areas, all with a limited supply of rooms compared to cities of similar population in the U.S. or Western Europe."

A co-author of this report and premier hotel advisor in Brazil, Mader, along with eight top hotel specialists, recently joined Jones Lang LaSalle Hotels in Sao Paulo. Mader was a former partner of Hotel Investment Advisors (HIA). His team was the first in Brazil to offer specialized consulting for hotel companies planning to expand or establish a presence in Brazil, Chile, Argentina and throughout South America.

To receive a copy of Jones Lang LaSalle Hotels' Hotel Intelligence: Brazil, visit www.joneslanglasallehotels.com or www.jllhss.com

About Jones Lang LaSalle Hotels

Jones Lang LaSalle Hotels, the first and leading global hotel investment services firm, is uniquely positioned to provide both the depth and breadth of advice required by hotel investors and hotel companies, through a robust and integrated local network. In 2007, Jones Lang LaSalle Hotels provided sale and

purchase advice on 259 hotel transactions globally; representing a combined value of US$13.9 billion.

The global team comprises over 270 hotel specialists, operating from 31 offices in 18 countries. The firm's advice is supported by a dedicated global research team, which produced over 45 publications in 2007 in addition to client research. Jones Lang LaSalle Hotels' services span the hospitality spectrum; from luxury single assets and large portfolios to select service and budget hotels, resorts and pubs. Their services include investment sales, mergers and acquisitions, capital raising, valuation and appraisal, asset management, strategic planning, operator selection, management contract negotiation, consulting, industry research and project development services. Jones Lang LaSalle Hotels' clients have access to the resources of its parent company, Jones Lang LaSalle (NYSE: JLL). www.joneslanglasallehotels.com

SOURCE Jones Lang LaSalle Hotels

http://www.joneslanglasallehotels.com

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