PHOENIX, Dec. 6 /PRNewswire-FirstCall/ -- InnSuites Hospitality Trust (AMEX:IHT) Highlights: * Operating income for the nine months ended October 31, 2005 was
$335,000, an improvement from $37,000 in the prior year.
* The third quarter reported loss attributable to Shares of Beneficial
Interest for the three months ended October 31, 2005 was $(372,000), or
$(0.04) per basic share, compared to the prior year period total of
$(341,000), or $(0.14) per basic share. Third quarter operating loss
narrowed to $(196,000) from $(284,000).
* Third quarter Trust revenue totaled $4.7 million for the three months
ended October 31, 2005, a decrease of 7.2% from the prior year period.
* The Trust is currently evaluating the potential for resort-area
condo-hotel individual ownership.
InnSuites Hospitality Trust reported operating income for the nine months ended October 31, 2005 of $335,000, an improvement from $37,000 in the prior year period. Operating income is before interest revenue and expense, income taxes and gains on the disposition of hotel properties. The Trust reported a net loss, including non-cash depreciation of $1.6 million, attributable to Shares of Beneficial Interest of $(550,000), or $(0.06) per basic and diluted share, for the nine months ended October 31, 2005, compared to net income, including non-cash depreciation of $2.1 million, of $804,000, or $0.35 per basic and $0.28 per diluted share, in the prior year period. The prior year period included gains on the disposition of hotels totaling $5.1 million. The portion of those gains attributable to Trust shareholders was $2.9 million, or $1.26 per basic and $0.64 per diluted share. The prior year period also included a charge of $854,000, or $(0.37) per basic and $(0.11) per diluted share, for the cumulative effect of adopting FIN 46R. The current year did not include the gain on disposition of real estate to a related party of $1.8 million. If the gain had been recorded in the Trust's operating statements, the Trust would have shown a profit of $697,000, or $0.08 per basic share, for nine months ended October 31, 2005.
The Trust also reported a third quarter operating loss for the three months ended October 31, 2005 of $(196,000), an improvement from $(284,000) in the prior year period. The Trust reported a net loss, including non-cash depreciation of $527,000, attributable to Shares of Beneficial Interest of $(372,000), or $(0.04) per basic and diluted share, for the three months ended October 31, 2005 compared to a net loss, including non-cash depreciation of $666,000, of $(341,000), or $(0.14) per basic and diluted share, in the prior year period.
The Trust reported total revenue of $4.7 million for the quarter ended October 31, 2005, a decrease of $364,000 or 7.2% from the prior year period due primarily to the impact of the sale to a related party of the Phoenix, Arizona hotel at the end of the second quarter ended July 31, 2005.
The Trust's management has identified condo-hotel conversions as a potential opportunity for the Trust. The conversion concept has become increasingly popular throughout the country, and may have the potential to eclipse time-share or fractional ownership as the preferred vacation, second or third home ownership vehicle. The Trust, through its wholly-owned subsidiary, InnSuites Hotels, is currently evaluating the potential for condo-hotel ownership primarily for its Arizona locations. If the Trust determines this concept to be feasible for its current hotel properties, the Trust may realize condominium sales revenue and revenue from long-term management and trademark agreements with potential homeowners' associations and/or future condominium owners.
Improving Trend The Trust's hotel operations continue to recover from the prior disruptions in the travel and hospitality industries. The Trust also continues to benefit from the disposal of underperforming properties. The Trust has benefited from management and trademark licensing agreements acquired during the prior fiscal year. The Trust continues to take aggressive steps to cut costs, increase sales, as well as evaluate new business opportunities, including condo-hotel resort-area individual ownership.
Your Suite Choice(R)- Value Concept InnSuites Hospitality Trust is a mid-market studio and two-room suite hospitality business trust owning 5 moderate service and full service hotels containing 843 hotel suites and managing and/or licensing 11 hotels with 1,692 suites located in Arizona, New Mexico, Texas and Southern California. For reservations, call 1-888-INNSUITES, or visit http://www.innsuites.com/. For investor information, visit http://www.innsuitestrust.com/.
Certain matters within this press release may be discussed using forward-looking language as specified in the 1995 Private Securities Litigation Reform Act and InnSuites Hospitality Trust intends that such forward-looking statements be subject to the safe-harbor created thereby. Such forward-looking statements include, but are not limited to: (i) expectations of growth in the financial and operating results of the Trust, (ii) expectations of reductions in costs incurred by the Trust, (iii) expectations that the travel and hospitality industries will continue to rebound in the near future, and (iv) expectations of benefits of condo-hotel conversion. InnSuites Hospitality Trust cautions that these statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statements contained herein. Such risks include, but are not limited to: a) fluctuations in hotel occupancy rates, b) changes in room rental rates which may be charged by InnSuites Hotels in response to market rental rate changes or otherwise, c) interest rate fluctuations, d) changes in federal income tax laws and regulations, e) competition, f) any changes in the Trust's financial condition or operating results due to acquisitions or dispositions of hotel properties, g) real estate and hospitality market conditions, h) hospitality industry factors, i) terrorist attacks or other acts of war, j) outbreaks of communicable diseases, k) natural disasters, l) market demand or lack of demand for condo-hotel conversions, and m) local or national economic and business conditions, including, without limitation, conditions which may affect public securities markets generally, the hospitality industry or the markets in which the Trust operates or will operate. From time to time, these and other risks are discussed in the Trust's Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. DATASOURCE: InnSuites Hospitality Trust CONTACT: Marc Berg, Executive Vice President of InnSuites Hospitality Trust, +1-602-944-1500, Web site: http://www.innsuites.com/ /Web site: http://www.innsuitestrust.com/
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