InnSuites Hospitality Trust (IHT) Reports First Quarter Fiscal 2012 Results

PHOENIX, June 3, 2011 /PRNewswire/ -- InnSuites Hospitality Trust (NYSE Amex: IHT)

Highlights:

• Adjusted EBITDA was $892,000 for the first quarter ended April 30, 2011 compared to $940,000 in the prior year period.
• Net income attributable to controlling interest was $50,000, or $0.01 per basic share, for the first quarter ended April 30, 2011, which includes $449,000 of non-cash depreciation.  This compares to income of $97,000, or $0.01 per basic share, for the first quarter ended April 30, 2010, which includes $470,000 of non-cash depreciation.
• Revenues for the first quarter of fiscal year 2012 were $5.0 million compared to $4.9 million in the prior year, reflecting increased occupancy as the travel industry improves.
• Following the success of the sale of membership interests in the subsidiary which owns and operates the Albuquerque, New Mexico hotel property, the Trust began sales of membership interests in the subsidiary which owns and operates the Tucson Foothills, Arizona hotel property.

InnSuites Hospitality Trust reported a operating income of $443,000 for the first quarter ended April 30, 2011, a decline of $28,000 from the prior year period operating income of $471,000.  The Trust also reported net income attributable to controlling interest of $50,000, or $0.01 per basic share and $0.00 per diluted share, for the fiscal quarter ended April 30, 2011, declining from $97,000, or $0.01 per basic and diluted share, in the prior year period.  Increased operating expenses due to significant property enhancements were the primary driver of the decreased income figures.

The Trust reported earnings before minority interest, interest, taxes, depreciation and amortization (Adjusted EBITDA) of $892,000 for the first quarter ended April 30, 2011, as compared to $940,000 in the prior year period, a decline of $48,000, or 5.1%. Adjusted EBITDA is a non-GAAP financial measure that management believes provides meaningful insight into the Trust's financial performance and its operating profitability before non-operating expenses (such as interest and "other" non-core expenses) and non-cash charges (depreciation and amortization).

A reconciliation of EBITDA to net income attributable to Shareholders of Beneficial Interest for the three months ended April 30 follows:

The Trust reported revenues of $5.0 million for the first quarter ended April 30, 2011, an increase of 1.6% from $4.9 million for the prior year period.  The increase in revenues is primarily due to increased occupancy as a result of improving travel industry conditions.

During the first quarter ended April 30, 2011, the Trust began selling partnership interests in the subsidiary which owns and operates the Tucson Foothills, Arizona hotel property, through private placements to accredited investors, for $10,000 per unit, with a total of 232 units available for sale.  The offering has received strong interest with net cash proceeds of $899,000 received and subscriptions of $2,070,000 through June 3, 2011.

FUTURE POSITIONING

For the current fiscal year 2012, InnSuites projects a moderate improvement in the economic environment, with slight increases in hotel revenue levels.  The Trust is focused on improved sales efficiencies and effective cost controls.  Although the travel and hospitality industries are down worldwide, InnSuites is experiencing strength relative to the rest of the industry by continuing to refurbish its hotels, increase boutique fashion trends, as well as increase internet marketing as more and more travelers move to the value-oriented InnSuites Suite Hotels and value suite concept "By the day and extended stay."

Our long-term strategic plan is to obtain the full benefit of our real estate equity and to migrate our focus from a hotel owner to a hospitality service company by expanding our trademark license, management, reservation and advertising services. This plan is similar to strategies followed by international diversified hotel industry leaders, which over the last several years have reduced real estate holdings and concentrated on hospitality services.

Your Suite Choice®- Value Concept

InnSuites Hospitality Trust is a mid-market studio and two-room suite hospitality real estate trust which wholly or partially owns and manages five moderate and full service suite hotels with 843 hotel suites located in Arizona, California and New Mexico.  The Trust through its wholly-owned subsidiary, InnSuites Hotels, Inc., manages a total of eight hotels and, as owner of the "InnSuites"® trademarks (which allow the Trust to enter markets that are not available to other hotel companies that do not control the brand), provides trademark and reservations services to a total of 27 hotels containing 2,766 rooms and suites.  For reservations, call 1-888-INNSUITES, or visit www.innsuites.com.  For investor information, visit www.innsuitestrust.com.

Certain matters within this press release may be discussed using forward-looking language as specified in the 1995 Private Securities Litigation Reform Act and InnSuites Hospitality Trust intends that such forward-looking statements be subject to the safe-harbor created thereby.  Such forward-looking statements include, but are not limited to: (i) the declaration or payment of dividends; (ii) the leasing, management or operation of the hotels; (iii) the adequacy of reserves for renovation and refurbishment; (iv) the Trust's financing plans; (v) the Trust's position regarding investments, acquisitions, developments, financings, conflicts of interest and other matters; (vi) the Trust's plans and expectations regarding future sales of hotel properties; and (vii) trends affecting the Trust's or any hotel's financial condition or results of operations. InnSuites Hospitality Trust cautions that these statements may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statements contained herein.  Such risks include, but are not limited to: a) local or national economic and business conditions, including, without limitation, conditions which may affect public securities markets generally, the hospitality industry or the markets in which the Trust operates or will operate, b) fluctuations in hotel occupancy rates; c) changes in room rental rates which may be charged by InnSuites Hotels in response to market rental rate changes or otherwise; d) seasonality of our business; e) interest rate fluctuations; f) changes in governmental regulations, including federal income tax laws and regulations; g) competition; h) any changes in the Trust's financial condition or operating results due to acquisitions or dispositions of hotel properties; i) insufficient resources to pursue our current strategies; j) concentration of our investments in the InnSuites Hotels® brand; k) loss of franchise contracts; l) real estate and hospitality market conditions; m) hospitality industry factors, n) our ability to meet present and future debt service obligations; o) loss of access to our line of credit; p) our inability to refinance indebtedness at or prior to the time it matures; q) terrorist attacks or other acts of war; r) outbreaks of communicable diseases; s) natural disasters; and t) loss of key personnel.

SOURCE InnSuites Hospitality Trust