DiamondRock Hospitality Company (DRH) has reported a 47.03 percent plunge in profit for the quarter ended Mar. 31, 2017. The company has earned $8.89 million, or $0.04 a share in the quarter, compared with $16.78 million, or $0.08 a share for the same period last year.
Revenue during the quarter dropped 7.90 percent to $196.21 million from $213.03 million in the previous year period.
Cost of revenue dropped 8.61 percent or $13.56 million during the quarter to $144.04 million. Gross margin for the quarter expanded 57 basis points over the previous year period to 26.59 percent.
Total expenses were $176.91 million for the quarter, down 6.26 percent or $11.81 million from year-ago period. Operating margin for the quarter contracted 158 basis points over the previous year period to 9.83 percent.
Operating income for the quarter was $19.30 million, compared with $24.31 million in the previous year period. However, the adjusted EBITDA for the quarter stood at $47.34 million compared with $50.34 million in the prior year period. At the same time, adjusted EBITDA margin improved 50 basis points in the quarter to 24.13 percent from 23.63 percent in the last year period.
For fiscal year 2017, DiamondRock Hospitality Company expects net income to be in the range of $89.45 million to $100.45 million.
Occupancy revenue was $137.83 million for the quarter, down 7.77 percent or $11.61 million. Food and beverage revenue was $44.78 million during the quarter, down 11.11 percent or $5.60 million from year-ago period. Revenue from other hotel operating activities was $13.60 million for the quarter, up 2.90 percent or $0.38 million from year-ago period.
Mark W. Brugger, President and Chief Executive Officer of DiamondRock Hospitality Company stated, “First quarter results benefited from our asset management team's strong execution in limiting total hotel expense growth to approximately 1%. We continued to position the portfolio for success in the quarter with the substantial completion of most of our 2017 renovations. Additionally, our recent acquisitions, the L’Auberge and Orchards Inn, exceeded underwriting in the first quarter with combined RevPAR growth of approximately 25%. As we look forward, with approximately $120 million of cash on hand and full capacity available under our $300 million credit facility, DiamondRock is positioned to to take advantage of opportunities as they emerge."
Receivables remain almost stable
Net receivables stood at $91.86 million as on Mar. 31, 2017.
Total assets went down marginally by 2.75 percent or $86.78 million to $3,068.75 million on Mar. 31, 2017. On the other hand, total liabilities were at $1,247.45 million as on Mar. 31, 2017, down 6.82 percent or $91.24 million from year-ago.
Return on assets moved down 30 basis points to 0.60 percent in the quarter. At the same time, return on equity moved down 44 basis points to 0.49 percent in the quarter.
Debt comes down
Total debt was at $918.01 million as on Mar. 31, 2017, down 10.48 percent or $107.52 million from year-ago. Shareholders equity was almost stable over the past one year at $1,821.30 million on Mar. 31, 2017. As a result, debt to equity ratio went down 6 basis points to 0.50 percent in the quarter.
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