Northampton Group Inc.

Northampton Group Inc.

November 26, 2007 07:43 ET

Northampton Second Quarter Occupancies Up

Lower Average Daily Rates Overall Result in Slight Revenue Decline

TORONTO, ONTARIO--(Marketwire - Nov. 26, 2007) - Northampton Group Inc. (TSX VENTURE:NHG)(TSX VENTURE:NHG.DB), an integrated Canadian hotelier, today reported its results for fiscal 2008's second quarter and six months ended September 30, 2007. The second quarter showed quarter-over-quarter sales decline of 4.4%; the six month period saw a 1.7% decrease in sales, as slight improvements in occupancy rates were offset by an overall decrease in average daily rates (ADRs).

Summary of the Quarter:

- In the six months, consolidated revenues were off 1.7% to $19.4 million from $19.7 million in the same period in the previous fiscal year; for the second quarter, revenues decreased 4.4% to 10.2 million from $10.7 million in the same quarter in fiscal 2007;

- Operating expenses decreased marginally in the six months and 1.6% in the quarter;

- Income from operations decreased by 8.1% in the 6-month period to $3.6 million from $3.9 million for the same period in the previous fiscal year. In the quarter, income from operations decreased 14.3% $2.0 million from $2.4 million in the same quarter of fiscal 2007;

- EBITA (earnings before income taxes, interest, and amortization) decreased 4.7% in the six months and 9.3% in the quarter;

- Net income fell 10.7% to $1.6 million in the first six months of fiscal 2008 from $1.9 million for the same period in the previous year, and in the second quarter decreased 20.7% to $925 thousand from $1.2 million for the same quarter in fiscal 2007;

- Earnings per share in the six months fell to $0.06 per share compared to $0.08 in the same period in the previous year. In the quarter, earnings per share were $0.04 compared to $0.05 for the second quarter of the previous fiscal year;

- Cash flow decreased 6.0% in the six months to $3.0 million or $0.11 per share. In the quarter, cash flow decreased 13.6% to $1.6 million or $0.06 per share;

- Same-hotel sales improved at most properties, with regional challenges in the Oakville-Hamilton corridor offset by strong performances in several hotels, especially in the Ottawa region;

- The Company launched Canada's first aloft by Starwood branded hotel in Dorval, Quebec;

- The Quality Inn Airport West won its fourth consecutive Gold Hospitality Award from Choice Hotels Canada.

Subsequent to the end of the quarter, Northampton's Board of Directors has established a new corporate dividend policy enabling two dividend payments per year rather than one, as has been the case for the past five years. The first payment will be $0.015 payable March 14, 2008 to shareholders of record February 28, 2008. The second proposed dividend payment is planned for October, 2008.

"The results of the current quarter underline the need to grow our portfolio, expand into new regions, and find new opportunities in underserved areas," said Vinod Patel, President and CEO of the Northampton Group. "The Company is seeing renewed strength in downtown Toronto and most airport hotels, all of which posted year-over-year gains. Ottawa's performance remains solid. The slowdown in the Hamilton - Oakville corridor is being addressed by a combination of approaches, including room upgrades and revising marketing strategies. Meanwhile, we continue to seek building opportunities in growing markets with need for new rooms."

The following is a tabulated summary of Northampton's results:

Three months ended September 30 Six months ended September 30
2007 2006 % change 2007 2006 % change
Revenues 10,203,834 10,677,985 -4.4 19,383,287 19,721,938 -1.72
Income from
operations 2,027,301 2,365,574 -14.3 3,598,433 3,917,215 -8.1
Net income 925,081 1,166,125 -20.7 1,669,196 1,868,772 -10.7
EBITA 3,452,659 3,804,610 -9.3 6,429,629 6,746,602 -4.7
Earnings per
share 0.036 0.048 -25.0 0.064 0.078 -17.9
Cash flow 1,580,737 1,830,501 -13.6 2,982,568 3,171,911 -6.0
Cash flow per
share 0.061 0.076 -19.7 0.115 0.133 -13.5

About Northampton

Northampton Group Inc. is an integrated Canadian hotelier with ownership and management interests in 2,064 rooms in 16 hotels. 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 demonstrated that it excels in this sector, offering services that exceed expectations while still posting industry-leading margins, as evidenced by Hotelier Magazine's Top Growth award for Northampton's fiscal 2003 and 2004.

The Canadian Venture Exchange has neither approved nor disapproved the contents of this press release.

Contact Information

  • Northampton Group Inc.
    Vinod Patel
    (905) 629-9992
    (905) 629-9636 (FAX)