LodgeNet Entertainment Corporation (Nasdaq: LNET) today reported its 32ndconsecutive increase in comparative quarterly revenue and EBITDA (earningsbefore interest, taxes depreciation and amortization).
Revenue in the thirdquarter of 2001 increased 9.1% to $57.7 million in comparison to the third quarter of 2000, while EBITDA increased 5.2% to $20.3 million from$19.3 million a year earlier. LodgeNet also reported record operating incomeof $4.0 million in the third quarter, a 42.7% increase over the year earlier.
said Scott C. Petersen, President and Chief ExecutiveOfficer of LodgeNet commented that “Despite the tragic events of September 11th and the subsequent impact onthe overall travel industry, we posted our 32nd consecutive record quarter forrevenue and cash flow as we continued to solidly execute on our long-term strategic growth plan,”
He went on to explain: “We added over 25,100 net new interactive guest rooms inthe quarter, all of which were installed with our new digital platform. Ourbacklog of contracts for interactive television services continued to expandas we signed significant agreements with LaQuinta Inns and Meristar Hotels andResorts. While the impact of the September 11th attacks is causing us to moderate our capital expenditure plans to some degree, we remain on track to serve approximately 810,000 guest rooms with interactive television servicesand have our new digital platform in more than 100,000 rooms by the end of2001.
“During this period of uncertain macroeconomic events, our business fundamentals remain sound. Through July and August, we were generating greater revenue per room this year as compared to last, despite the general economic slowdown and a 340 basis point decrease in hotel occupancy rates. While per-room revenues have rebounded significantly since the first two weeks after the attacks, we are presently generating approximately 15% less revenueper room this year compared to the same days last year. The decrease is significantly more pronounced in the urban and airport markets as compared toour suburban and highway locations, which account for more than sixty percentof our rooms.
“Overall we believe LodgeNet is well positioned for the current environment. We have taken prudent measures to adjust our cost structures tothe current economic environment and strengthen our long-term growth outlook.We remain focused on growing our interactive room base pursuant to long-term contracts, maximizing the revenue generated by each of our rooms and increasing the overall efficiency and profitability of our company.”
“LodgeNet continued to make exceptional operating progress during the quarter,” said Gary H. Ritondaro, Senior Vice President and Chief FinancialOfficer of LodgeNet. “Operating costs decreased as a percentage of revenue by120 basis points quarter over quarter. We saw a reduction on a per-room basisfor both SG&A and Guest Pay operations. With our $225 million bank facilityin place and a leverage ratio of 4.2 times net debt to EBITDA, our financialfoundation remains sound and we have the resources necessary to execute our business plan.”
LodgeNet Entertainment Corporation is a broadband, interactive services provider which specializes in the delivery ofinteractive television and Internet access services to the lodging industry throughout the United States and Canada as well as select internationalmarkets.