Northampton Group Inc.

Northampton Group Inc.

February 21, 2008 14:50 ET

Northampton Third Quarter Revenues Rise

Improved Quarterly RevPAR Drives Increased EBITA, Income from Operations

TORONTO, ONTARIO--(Marketwire - Feb. 21, 2008) - Northampton Group Inc. (TSX VENTURE:NHG)(TSX VENTURE:NHG.DB), an integrated Canadian hotelier, today reported its results for fiscal 2008's third quarter and nine months ended December 31, 2007. The third quarter showed a quarter-over-quarter sales increase of 2.5%; the nine-month period saw a 0.51% decrease in sales, as improvements in occupancy rates were offset by lower average daily rates (ADRs).

In the third quarter, Northampton's RevPAR (revenue per available room) increased an average 5.5%, closing in on industry analyst PKF Consulting's estimate of RevPAR growth of 6.0% for the country in the same period, and in fact beating national performance two months out of the three, an exceptional results given the current strength of the western Canadian economy at this point.

Summary of the Quarter:

- In the nine months, consolidated revenues fell 0.51% to $27.5 million from $27.6 million in the same period in the previous fiscal year; for the third quarter, revenues increased 2.5% to $8.1 million from $7.9 million in the same quarter in fiscal 2007;

- Operating expenses increased marginally in the nine months and 2.5% in the quarter;

- Income from operations decreased by 6.0% in the nine-month period to $3.9 million from $4.1 million for the same period in the previous fiscal year. In the quarter, income from operations increased a substantial 30.5% to $300 thousand from $230 thousand in the same quarter of fiscal 2007;

- EBITA (earnings before income taxes, interest, and amortization) decreased 3.2% in the nine months and rose 2.6% in the quarter;

- Net income fell 10.3% to $1.8 million in the first nine months of fiscal 2008 from $2.0 million for the same period in the previous year, and in the third quarter decreased 3.3% to $105 thousand from $108 thousand for the same quarter in fiscal 2007;

- Earnings per share in the nine months fell to $0.068 per share compared to $0.083 in the same period in the previous year. In the quarter, earnings per share were $0.004 compared to $0.004 for the third quarter of the previous fiscal year;

- Cash flow decreased 4.5% in the nine months to $3.8 million or $0.146 per share. In the quarter, cash flow increased 1.5% to $809 thousand or $0.031 per share;

- Northampton's Board of Directors 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;

- Same-hotel sales improved slightly quarter-over-quarter at most properties.

Subsequent to the end of the third quarter, Northampton announced the purchase of land for a new hotel property to be built in Vaughan, north of Toronto, in a joint venture with partner, Silver Hotels Group.

"We have moved into a period of focused strategic growth," said Vinod Patel, President and CEO of the Northampton Group. "We have identified an opportunity to expand our portfolio in the select-service segment, to be licensed with a major franchise company offering a youthful brand with a sophisticated urban feel, working together with Silver Hotels Group. The first of these initiatives by Northampton/Silver is the building of the previously announced "aloft by Starwood" hotel in Dorval, Quebec, at Montreal's airport. We are actively seeking properties that offer strong potential in under-served markets. We have a successful history of building economically, and the current market plays to our strengths."

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

Three months ended December 31 Nine months ended December 31
2007 2006 % change 2007 2006 % change
Revenues 8,092,927 7,894,557 2.5 27,476,214 27,616,495 -0.51
Income from
operations 299,817 229,759 30.5 3,898,250 4,146,974 -6.0
Net income 104,544 108,168 -3.3 1,773,750 1,976,940 -10.3
EBITA 1,756,071 1,712,009 2.6 8,185,700 8,458,611 -3.2
per share 0.004 0.004 0.0 0.068 0.083 -18.1
Cash flow 809,445 797,097 1.5 3,792,013 3,969,008 -4.5
Cash flow
per share 0.031 0.033 -6.1 0.146 0.166 -12.0

About Northampton

Northampton Group Inc. is an integrated Canadian hotelier with ownership and management interests in 2,064 rooms in 16 hotels, and a focused, strategic growth program. 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.

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)