|SPRINGFIELD, Mo., Aug. 11, 1998 - John Q. Hammons
Hotels, Inc. (NYSE: JQH) today reported total earnings before interest
expense, taxes, depreciation and amortization (EBITDA) of $24.1 million
for the second quarter ended July 3, 1998, compared to 1997 second quarter
EBITDA of $24.2 million. Total revenue for the quarter increased to $81.8
million, up 7.3% from $76.2 million in the 1997 second quarter.
On May 11, 1998 the Company opened World Golf Resort Convention Center in St. Augustine, Florida. The opening marked the sixteenth hotel the Company has developed in less than three years. The Company expects to open two additional hotels during the remainder of 1998. These two hotels are Capitol Plaza Hotel in Topeka, Kansas; and Embassy Suites Hotel in Portland, Oregon.
The Company's average room rate for the quarter was $91.78, up 12.9% compared to the 1997 second quarter average room rate of $81.26. In comparison, average room rate for the hotel industry was $78.30 in the second quarter, up 4.7% from the 1997 second quarter. The Company's occupancy for the quarter was 64.9%, down 2.8 percentage points from the 1997 second quarter. Occupancy for the hotel industry was 67.5%, down 0.7 percentage point from the 1997 second quarter. The Company's Revenue Per Available Room (RevPAR) was $59.56 in the 1998 second quarter, up 8.4% from $54.97 in the 1997 second quarter. RevPAR for the hotel industry was $52.87, up 4.0% from the 1997 second quarter.
The Company recorded an EBITDA of $46.3 million for the first six months of 1998 exceeding the same period in 1997 by 2.9%. The Company's occupancy for six months was 63.1%, down 2.4 percentage points from the previous year. Average room rate of $91.00 grew by $10.30, a 12.8% increase. Similarly, RevPAR of $57.44 also improved by $4.61 from the six month period in 1997.
John Q. Hammons, Chairman and Chief Executive Officer said, "The EBITDA
results for the second quarter are ahead of our expectations. Our movement
toward upscale and upper scale hotels is driving our RevPAR and we are
most encouraged to see it growing at more than twice the pace of the industry's
RevPAR growth rate in the second quarter. Also, in absolute terms, we achieved
a 12.7% RevPAR premium to the industry. With fewer hotels being constructed
in the upscale and upper scale price segments, we believe these segments
will be the place to be in the future. The new hotels added (eight) since
the beginning of 1997 while adding revenues to the Company will also add
strong incremental EBITDA in the future. These properties are on track
Basic and diluted earnings (loss) per share in the second quarter was a $0.06 loss, compared to a $0.26 profit in the 1997 second quarter. The EPS loss was driven by fixed charges associated with the Company's seven new hotels opened in 1997 and the 1998 second quarter.
At the end of the 1998 second quarter the Company had six new projects under construction -- Capitol Plaza Hotel adjacent to the City Convention Center in Topeka Kansas; Embassy Suites at the International Airport in Portland, Oregon; Hampton Inn Suites Hotel adjacent to the Mesquite Championship Rodeo Arena in Mesquite, Texas; Radisson Plaza Hotel adjacent to the PGA TOUR Tournament Players Club at Heron Bay in Coral Springs, Florida; Embassy Suites Hotel at the Dallas-Fort Worth Airport connected to the Bass Pro Shop in Grapevine, Texas; and a Marriott Renaissance hotel in Charlotte, North Carolina.
The Company currently owns and manages 45 Hotels, including four managed
hotels, with 11,090 rooms in 20 states. The new hotels under construction
will add 1,463 suites and rooms which represent an increase of 13.1% to
the Company's Portfolio.