ResortQuest profit
plunges 92.7% in
aftermath of attacks

Hawaii properties, which include
Aston Hotels & Resorts, are
hit particularly hard

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By Russ Lynch
rlynch@starbulletin.com

Declining hotel business in Hawaii, due to the terrorism-related fall in air travel in September, pulled third-quarter earnings lower at Memphis, Tenn.-based ResortQuest International Inc.

The company today reported a 92.7 percent decline in net profit to $466,000, or 2 cents a share, compared to a profit of $6.4 million, or 34 cents a share, in the third quarter of 2000.

Much of the decline was due to a one-time set of administrative expenses totaling $3.8 million before taxes in the latest quarter, due to writing down the value of some software and accounting for deferred acquisition costs.

Leaving that out of the equation, the net would have been $5 million in the 2001 quarter, down a more moderate 21.9 percent.

ResortQuest, owner of Aston Hotels & Resorts in the islands and other vacation accommodations businesses across North America, said its Hawaii lodging revenues for the full quarter were down 11.5 percent because of the decline in the last three weeks of September.

Excluding Hawaii, lodging revenues for the quarter were down only 2.1 percent, comparing the same properties, the company said.

Company-wide gross lodging revenues in the third quarter were $141.3 million, up 8.5 percent from $130.2 million in the year-earlier quarter, as the company added businesses to its inventory. Total same-property lodging revenues were $102.9 million, down 5.7 percent from a year-earlier $109.2 million.

Gross lodging revenue is the total room rent received. Out of that, ResortQuest in some cases keeps only some of the amount as a management fee.

The revenues the company got to keep for itself in the latest quarter totaled $48.7 million, including real estate income and other businesses as well as lodging revenues. That was a 3.6 percent increase from, $47 million in the 2000 quarter.

The company reported total Hawaii lodging revenues of $37.5 million in the latest quarter, down from $42.4 million in the year-earlier quarter.

Third-quarter Hawaii occupancy averaged 70.5 percent, down from a year-earlier 80.9 percent.

The company managed 5,292 rooms in Hawaii, down 2.2 percent from 5,413 in the 2000 quarter, due to a shift in management contracts.