Red Lion Hotels Corporation (RLH) saw its loss narrow to $3.60 million, or $0.18 a share for the quarter ended Mar. 31, 2017. In the previous year period, the company reported a loss of $4.80 million, or $0.24 a share. On the other hand, adjusted net loss for the quarter narrowed to $5.20 million, or $0.22 a share from a loss of $5.69 million or $0.28 a share, a year ago.

Revenue during the quarter grew 22.30 percent to $39.96 million from $32.67 million in the previous year period. Gross margin for the quarter expanded 542 basis points over the previous year period to 14.85 percent. Operating margin for the quarter stood at negative 7.94 percent as compared to a negative 13.83 percent for the previous year period.

Operating loss for the quarter was $3.17 million, compared with an operating loss of $4.52 million in the previous year period.

However, the adjusted EBITDA for the quarter stood at $1.47 million compared to negative $0.67 million in the prior year second quarter. At the same time, adjusted EBITDA margin stood at 3.67 percent for the quarter compared to negative 2.05 percent in the last year period.

"The significant improvements realized in the first quarter demonstrate the fundamental changes that we have executed the past few years toward a higher-margin franchise fee business model while also achieving a less capital intensive future. This is RLHC executing on its growth platform and working to achieve consistent profitability. We are driving increased demand for our portfolio of franchise brands and are confident in our ability to generate consistent unit growth. The unit growth will be achieved across many geographic areas that represent significant long-term unit growth potential for the broad and diverse RLHC brand portfolio," stated Greg T. Mount, RLHC president and chief executive officer. "We are focused on achieving the substantial RevPAR benefits that are being driven by RevPak while also deploying RevPak-lite to our acquired economy-segment franchise hotels. We have also initiated our brand-stratification plan that we expect will improve profitability throughout the brand network and attract additional unit growth demand for RLHC. We are well positioned to capitalize on our asset-light franchise model, which in turn we expect to translate to continued growth in EBITDA over the years to come."

The company has spent $3 million cash to meet investing activities during the quarter as against cash outgo of $5.05 million in the last year period.

Cash flow from financing activities was $1.75 million for the quarter, down 81.34 percent or $7.63 million, when compared with the last year period.

Cash and cash equivalents stood at $31.69 million as on Mar. 31, 2017, up 68.09 percent or $12.84 million from $18.85 million on Mar. 31, 2016.

Working capital declines
Red Lion Hotels Corporation has witnessed a decline in the working capital over the last year. It stood at $29.79 million as at Mar. 31, 2017, down 21.64 percent or $8.23 million from $38.02 million on Mar. 31, 2016. Current ratio was at 1.84 as on Mar. 31, 2017, down from 2.41 on Mar. 31, 2016.

Cash conversion cycle (CCC) has increased to 9 days for the quarter from 4 days for the last year period. Days sales outstanding went up to 29 days for the quarter compared with 28 days for the same period last year.

Days inventory outstanding has decreased to 1 days for the quarter compared with 2 days for the previous year period. At the same time, days payable outstanding went down to 21 days for the quarter from 26 for the same period last year.