Resort Income said it lost $6.41 per share, compared with a net profit of 96 cents per share, or $4 million, in 1994.
The losses came after the company increased its reserves by $25.8 million to cover troubled loans largely to entities affiliated with Hemmeter, Resort Income said.
The bad debt includes $14.3 million owed by Hemmeter and his wife, $5 million owed by R.C.H Investments and $1 million owed by Hemmeter Enterprises Inc. Canadian Pavilion Limited Partnership owes the company for a $2.6 million loan, while Outlaws Casino Ltd. owes $1.6 million.
John Rippey Young, Resort Income's chairman, said the trust still plans to collect on the loans, even though it has set aside reserves to protect it.
Resort Income Investors is a real estate investment trust that specialized in lending to gaming companies. Christopher Hemmeter is developer of the former West Kauai and Hyatt Regency Waikoloa resorts.
In June 1995, the company said that it would liquidate its operations and distribute the proceeds to its 4.2 million shareholders. Hemmeter resigned as Resort Income's chairman and chief executive officer in August 1995.
The company, whose stock was delisted from the American Stock Exchange in April, said it hasn't distributed any sale proceeds due to shareholder lawsuits filed against the company last year.
Meanwhile, one of the borrowers, Hemmeter Enterprises, filed for Chapter 11 bankruptcy protection last November. In April, Hemmeter Enterprises turned over the ownership of two Colorado casinos to its bondholders.