SPOKANE, WA— WestCoast Hospitality Corp. reported third-quarter earnings for the three months ended September 30. Diluted EPS was $0.29, a 26.1% increase compared to diluted EPS of $0.23 in third-quarter 2001. During the quarter, total revenue increased 64.5%, from $33.8 million in third-quarter 2001 to $55.7 million in 2002, while EBITDA increased 18.8% to $12 million. Cash flow per share of stock, defined as net cash provided by operating activities excluding changes in current assets and liabilities, was $0.55 per share in the quarter compared to $0.45 per share in the year-ago period, an increase of 22.2%. During the quarter, total hotel and restaurant revenues increased $22.3 million, or 79%, from $28.2 million in third-quarter 2001, to $50.5 million in the comparable period of 2002. Revenue was positively impacted by the acquisition of Red Lion Hotels in December 2001, according to the company. Combined hotel RevPAR (hotels owned, managed, or franchised for greater than one year by WestCoast and Red Lion Hotels, Inc.) declined 4% during the period, from $56.35 in third-quarter 2001, to $54.07 in 2002. RevPAR trends returned to positive year-on-year comparisons upon the anniversary of September 11. RevPAR during September increased 6.3% at all company-owned hotels and through the first three weeks of October, RevPAR increased 9.3% compared to the first three weeks of October 2001. WestCoast expects the positive RevPAR comparisons to continue through the remainder of the fourth quarter. Margin decreases in the hotel division resulted primarily from the acquisition of Red Lion Hotels, which included 12 hotels controlled through operating leases, which are expensed and deducted prior to EBITDA and affect ratios when compared to owned hotels, according to the company. As previously reported, subsequent to the close of the third quarter, WestCoast announced the potential sale of the WestCoast Kalispell Hotel in connection with the sale of the company-owned Kalispell Center Mall, in Kalispell, MT. The company will retain management of the hotel portion of the project and the hotel will continue to be branded by WestCoast. The sale is subject to due diligence contingencies and is expected to close within the next three months. The sale follows the companys stated strategy of divesting of ownership in certain assets, with the proceeds being used to pay down debt and for further expansion in the core areas of the business. In addition, WestCoast said it was rebranding more than 20 WestCoast Hotels to Red Lions. The move followed nine months of market research and analysis on how to align the WestCoast and Red Lion brands to best allow national and international growth of the Companys hotel division, the company said. The Red Lion brand name was found to have more familiarity and appeal on a broad geographic scale, specifically in the Midwest and Eastern U.S. The WestCoast brand name will continue to exist and grow under WestCoast Signature Hotels. “Im pleased with the direction of our hotel division,” said Don Barbieri, chairman/ president/CEO. “The re-branding of many of our hotels will result in more mass than our company has ever had in one brand, and that massing will be important as we begin our push eastward. I also believe that the repositioning of our WestCoast Hotels will benefit those that we market as WestCoast Signature Hotels. Our marketing message for these hotels will better represent their distinctive qualities.
Previous ArticleNew Comfort Inn Opens In Beaver, Utah
Next Article Elegant Hotel Group Taps Lexington Services