Prime Hospitality Corp.
(NYSE: PDQ), a leading hotel owner, operator and franchisor, reported its
results for the second quarter and six months ended June 30, 2001.
Net income before asset transactions and other charges for the second
quarter was $11.7 million, or $.26 per share, compared to $15.2 million, or
$.33 per share, for the second quarter of 2000.
Total net income was $20.6 million, or $.45 per share, for the second
quarter of 2001 compared to $24.4 million or $.53 per share, for the same
period in 2000. Non-recurring items in the second quarter of 2001 consisted
primarily of the recognition of deferred gains on the termination of four
leases. For the second quarter of 2000, non-recurring items consisted
primarily of gains on asset sales.
“Our hotel performance continues to be impacted by the slowdown in
business travel,” said A.F. Petrocelli, Chairman and Chief Executive Officer
of Prime. “Despite this challenging environment, we took a number of
significant steps in the development of our brands in the quarter. In May, we
began our new advertising campaign with AmeriSuites on national cable
television and Wellesley on national radio. The ads have already had an
impact as call volume at our reservation center has increased by 10% so far
this quarter. We also made significant progress toward expanding our rewards
program. Our new program, which will offer frequent guests both hotel points
and airline miles for each stay, is on target for a September launch. We are
also pleased with our brand growth as we achieved four Wellesley Inn
conversions and the opening of our largest AmeriSuites, a 245-room hotel at
Chicago O`Hare Airport.”
“We are in excellent financial shape to withstand a continued economic
downturn,” commented Petrocelli. “Our balance sheet is among the strongest in
the industry with leverage down to 32.5% of capitalization and we are moving
forward with our initiatives to create additional brand value.”
For the six months ended June 30, 2001, net income was $30.2 million, or
$.66 per share, compared to $34.9 million, or $.74 per share, for the same
period in 2000. Net income before asset transactions and other charges was
$21.3 million, or $.46 per share, for the first half of 2001 as compared to
$25.5 million, or $.54 per share, for the same period in 2000.