Prime Hospitality Corp.
(NYSE: PDQ) today reported net income of $24.4 million, or $.53 per share, in
the second quarter of 2000 compared to net income of $16.3 million, or $.31
per share, in the same period of 1999. Earnings per share before asset
transactions grew by 13% to $.35 per share for the 2000-quarter versus $.31
per share in the prior year`s quarter.
“We are very pleased with our second quarter results”, said A.F.
Petrocelli, chairman and CEO of Prime. “Our operating performance was strong
across all our segments, with comparable REVPAR rising by 5.4%. In addition,
our conversion of 38 hotels to the Wellesley Inn & Suites brand has been a
success thus far, with REVPAR growing by 24% over the past year. We also made
significant progress in accelerating the growth of our AmeriSuites brand. We
will be adding 30 AmeriSuites through the conversion of the Sumner Suites
brand and we have another 62 AmeriSuites to be built under executed franchise
“In addition to the positive operating trends, we also continue to
strengthen our financial picture,” said Petrocelli. “We generated $85 million
in asset sale proceeds in the quarter bringing our total sales to $187 million
this year. With these proceeds, we have reduced our debt this year by almost
$150 million and purchased 3.7 million shares. Our debt to capitalization
ratio is now at 39%, among the lowest in the industry.”
For the quarter, revenues were $140.6 million and earnings before
interest, taxes, depreciation and amortization (EBITDA) was $47.8 million.
Excluding the impact of the hotels divested in the past year, revenues and
EBITDA each grew by approximately 10%. The Company also generated gains from
property transactions of $13.5 million in the quarter.
For the six months ended June 30, 2000, net income was $34.9 million, or
$.74 per share, as compared to $22.5 million, or $.42 per share, in the same
period of the prior year. Income before property transactions and special
charges was $.57 per share in 2000 versus $.53 per share in 1999.
Non-recurring charges for the first six months of 2000 were comprised of gains
on asset sales of $.17 per share. For the first six months of 1999,
non-recurring items were comprised primarily of a loss of $.10 per share due
to a change in accounting principle related to the write-off of start-up