Jameson Inns, Inc. (NASDAQ:JAMS) , owner and operator of Jameson Inn and Signature Inn hotels, today announced financial results for the quarter and year ended December 31, 2004.
For the quarter, overall RevPAR increased 4.8%, the Jameson Inn brand RevPAR increased 7.8%.
For the year, overall RevPAR increased 3.1%, the Jameson Inn brand RevPAR increased 5.4%.
The Company completed the rollout of high speed internet access and computers in the lobby at nearly all of its hotels.
Three of the Signature Inn conversions to the Jameson Inn brand are substantially complete.
During fourth quarter 2004, the Company's hotels included in continuing operations earned lodging revenues of approximately $18.7 million compared to lodging revenues of approximately $19.0 million in fourth quarter 2003. This decrease is due to an overall decrease in occupancy and fewer rooms available, offset by an increase in ADR. Lodging revenues in 2003 were earned by Kitchin Hospitality, LLC, the lessee of the Inns. All of the Company's hotels were under lease to Kitchin Hospitality, LLC in 2003.
The Jameson Inn occupancy rate increased slightly to 50.7% during fourth quarter 2004 from 50.6% in 2003. ADR for Jameson Inn brand increased 7.5% in fourth quarter 2004 as compared to fourth quarter 2003. The increase in occupancy and ADR resulted in a RevPAR increase of 7.8%.
The Signature Inn occupancy rate decreased to 33.1% in fourth quarter 2004 from 36.1% in fourth quarter 2003. ADR for the Signature Inn brand increased to $69.29 during the fourth quarter 2004 from $67.34 in the fourth quarter 2003, an increase of 2.9%. The decline in occupancy, slightly offset by the increase in ADR resulted in a RevPAR decrease of 5.7%.
Overall, quarter over quarter combined Jameson and Signature RevPAR increased 4.8%.
For full year 2004, the Company's hotels included in continuing operations earned lodging revenues of approximately $82.6 million compared to lodging revenues of approximately $82.8 million for 2003. This slight decrease is due to fewer rooms available, offset by an overall increase in occupancy and an increase in ADR.
During 2004, the occupancy rate for the Jameson Inn brand increased to 55.5% from 54.5% during 2003. ADR for the Jameson Inn brand increased approximately 3.4% in 2004 compared to 2003. The increase in occupancy and ADR resulted in a 5.4% increase in RevPAR.
During 2004, the Signature Inn brand increased ADR to $66.73 from $65.55 in 2003, an increase of 1.8%. Occupancy rate for Signature decreased to 40.1% in 2004 from 42.9% in 2003. The decline in occupancy, slightly offset by the increase in ADR, resulted in a RevPAR decline of 4.9%.
Overall, year over year combined Jameson and Signature RevPAR increased 3.1%.
The Company reported a net loss attributable to common stockholders of $7.8 million for the quarter compared to a net loss of $4.0 million in fourth quarter 2003. The increase in the loss was primarily due to an impairment charge of $2.3 million taken on four Signature Inns held for sale, income tax expense of $3.3 million to record a complete valuation allowance for the Company's deferred tax asset, partially offset by the elimination in the fourth quarter of 2004 the preferred dividends of $1.7 million paid in the fourth quarter of 2003 due to the redemption of the preferred stock in August 2004.
For the year the Company recorded a net loss attributable to common stockholders of $34.1 million compared to a net loss of $7.5 million for all of 2003. The increase in the loss is primarily due to the following three items.
A one-time $9.0 million lease termination charge as a result of the acquisition of Kitchin Hospitality.
A $6.6 million impairment charge related to Signature Inns held for sale.
A one-time $16.0 million non-cash charge related to the redemption of preferred stock in August 2004.
Effective January 1, 2004, the Company relinquished its status as a REIT for federal income tax purposes and became a taxable corporation. As a REIT, the Company did not record income taxes or related deferred taxes for financial reporting purposes. A deferred tax benefit of approximately $1.4 million, net of a valuation allowance of $0.1 million, was recorded to establish the Company's initial deferred tax asset resulting from the difference in basis of its assets and liabilities for financial reporting and income tax purposes as a result of the change in taxable status. An additional valuation allowance of approximately $6.0 million was recorded in 2004 based on the Company's review of its estimate of realization of deferred tax assets. The Company has not recognized any income tax benefit for 2004 related to its taxable loss since the Company is uncertain whether there will be sufficient taxable income in future periods to allow for the utilization of the net deferred tax assets.
"2004 was a restructuring and transitional year for us. We accomplished a lot in completing the acquisition of Kitchin Hospitality, LLC, raising $83 million of common equity and redeeming $76 million in preferred stock. We took several non-cash charges during the year, but have positioned the Company well going into 2005 and beyond," stated Thomas W. Kitchin, Chairman and Chief Executive Officer of Jameson Inns, Inc. "The outlook for the industry remains positive with most industry analysts predicting continued RevPAR gains for the foreseeable future," added Kitchin.
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