Northampton Group Inc.
TSX VENTURE : NHG
TSX VENTURE : NHG.DB

Northampton Group Inc.

November 25, 2010 09:49 ET

Northampton Posts Double Digit Sales Increase in Q2

TORONTO, ONTARIO--(Marketwire - Nov. 25, 2010) - Northampton Group Inc. (TSX VENTURE:NHG)(TSX VENTURE:NHG.DB), an integrated Canadian hotelier, today reported its financial results for fiscal 2011's second quarter and six months ended September 30, 2010. The second quarter showed the Company's second consecutive quarter-over-quarter sales increase, with an 11.8% rise; the six-month period saw an increase of 11.9%, both increases demonstrating the strength of Northampton's operational turnaround.

Northampton outperformed in its major markets. While industry analysts Pannell Kerr Forster Consulting (PKF) saw Canada's overall improvement in revenue per available room (RevPAR) rise by 2.3%, and Toronto and Montreal increasing by 6.7% and 8.5% respectively by the end of September, Northampton's hotels posted an average 11.6% increase in RevPAR in its first two quarters, with occupancies and rates also showing improved strength.

"This is the type of environment in which our careful cost management pays off," said Vinod Patel, president and CEO of Northampton Group. "In response to the industry-wide margin squeeze we've seen in earlier quarters, we stringently reduced costs and as the market improves our hotels will show real performance upside."

Highlights of the Quarter:
  • In the six months, consolidated revenues rose 11.9% to $16.07 million from $14.36 million for the same period a year ago; for the second quarter, revenues increased by11.8% to $8.64 million from $7.73 million in the same quarter in fiscal 2010;
  • Operating expenses increased 2.2% in the six months and 5.6% in the quarter, reflecting the Company's ongoing efforts at cost containment despite sales growth;
  • Income from operations increased by 313.3% in the 6-month period to $2.04 million from $0.49 million for the same period in the previous fiscal year. In the quarter, income from operations increased 113.4% to $1.17 million from $0.55 million in the same quarter of fiscal 2010;
  • Operating profit or EBITA (earnings before income taxes, interest, and amortization) increased 45.4% in the six months and 30.4% in the quarter;
  • Net income (loss) from continuing operations rose to $1.14 million in the first six months of fiscal 2011 from ($0.09 million) for the same period in the previous year, and in the second quarter increased to $0.92 million from $0.29 million for the same quarter in fiscal 2010;
  • Earnings/(loss) per share from continuing operations in the six months was $0.04 per share compared to ($0.00) in the same period in the previous year. In the quarter, earnings per share were $0.04 compared to $0.01 for the second quarter of the previous fiscal year;
  • Cash flow, or net income from continuing operations plus amortization, in the six months was $2.46 million or $0.09 per share compared to $1.25 million or $0.05 per share in the previous year. In the quarter, cash flow from continuing operations was $1.62 million or $0.06 per share compared to $0.96 million or $0.04 per share in the same quarter of the previous year; 
  • Sales grew at all properties, with strong performances in the Montreal, Toronto, and Ottawa markets.
The following is a tabulated summary of Northampton's results from continuing operations:
 
    Three months ended September 30   Six months ended September 30
    2010   2009   % change   2010   2009     % change
Revenues   8,644,928   7,729,364   11.8   16,067,160   14,359,325     11.9
Income from operations   1,170,162   548,293   113.4   2,042,718   494,219     313.3
Net income (loss) from continuing operations   923,523   286,496   222.4   1,140,972   (91,374 )   -
Earnings per share from continuing operations   0.04   0.01   300.0   0.04   (0.00 )   -
Cash flow from continuing operations   1,620,151   960,003   68.8   2,457,925   1,253,507     96.1
Cash flow per share from continuing operations   0.06   0.04   50.0   0.09   0.05     80.0
EBITDA   2,531,963   1,941,180   30.4   4,679,602   3,219,334     45.4

For a more complete discussion of the Company's results, please see Northampton's quarterly filings on www.sedar.com, or the quarterly MD&A, financials, and notes to the financial statements on the Company's website at www.nhgi.com.

About Northampton

Northampton Group Inc. is an integrated Canadian hotelier with ownership and management interests in 2,002 rooms in 16 hotels, with a selective strategic development program in place. Focused on creating the best return for all stakeholders, Northampton's proven, market-sensitive strategy is to acquire or build hotels that provide superior overnight accommodation in the mid-price market. Northampton has consistently excelled in this sector, offering services that exceed expectations while still posting industry-leading margins. 

Disclaimer:

This news release contains forward-looking statements within the meaning of the "safe harbour" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties and other factors that may cause Northampton's results to differ materially from expectations. Such risks may relate to hotel performance, market fluctuations, investee performance, and other risks more fully described in the Company's annual report, posted on the Company's website and on SEDAR. These forward-looking statements speak only as of the date hereof. Northampton Group disclaims any intent or obligation to update these forward-looking statements.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Northampton Group Inc.
    Vinod Patel
    President and CEO
    905-629-9992