SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20459
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR QUARTER ENDED DECEMBER 31, 2001, COMMISSION FILE NUMBER 0-1957
UPTOWNER INNS, INC.
(Exact Name of Registrant as Specified in its Charter)
West Virginia 55-0457171
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
1415 4th Avenue, Huntington, West Virginia 25701
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including area code (304) 525-8162
Indicate by check mark whether the registrant:
(1) has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such
reports), and,
(2) has been subject to such filing requirements for the past 90
days.
Yes X No
_______ ______
Indicate the number of Shares outstanding of each of the Issuer's classes
of Common Stock, as of the close of the period covered by this report.
Class Outstanding at December 31, 2001
______ _______________________________
Common Stock - $.50 par value 1,583,563 shares
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PART I: FINANCIAL INFORMATION
ITEM 1: FINANCIAL STATEMENTS
UPTOWNER INNS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
AT DECEMBER 31, 2001 and JUNE 30, 2001
ASSETS
December 31, June 30,
2001 2001
(Unaudited) (a)
Current Assets:
Cash $ 69,468 $ 186,912
Accounts and notes receivable 98,409 72,830
Inventories 7,595 7,715
Prepaid expenses 24,341 48,392
Property held for sale 327,811 327,811
Total current assets 527,624 643,660
Property, Plant and Equipment:
Land 1,539,252 1,519,252
Building and improvements 10,680,357 10,680,357
Furniture and equipment 2,766,780 2,761,410
Less accumulated
depreciation
and amortization 5,065,072 4,846,594
Property, plant and
equipment - net 9,921,317 10,114,425
Other Assets:
Deposits and other 203,238 141,837
Total Assets $ 10,652,179 $ 10,899,922
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UPTOWNER INNS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEET
AT DECEMBER 31, 2001 and JUNE 30, 2001
LIABILITIES AND STOCKHOLDERS' EQUITY
December 31, June 30,
2001 2001
(Unaudited) (a)
Current Liabilities:
Accounts payable $ 191,744 $ 232,588
Accrued liabilities 260,671 200,484
Taxes other than Federal
income taxes 378,285 313,480
Current portion of long-term
debt 1,409,378 1,400,385
Total current liabilities 2,240,078 2,146,937
Long-Term Liabilities:
Notes and mortgages payable 6,339,722 6,636,076
Total liabilities 8,579,800 8,783,013
Stockholders' Equity:
Common stock - par value
$.50 per share; authorized
5,000,000 shares; issued
1,583,563 shares 791,782 791,782
Additional paid-in capital 1,032,290 1,032,290
Retained earnings 248,307 292,837
Total stockholders' equity 2,072,379 2,116,909
Total Liabilities and
Stockholders' Equity $10,652,179 $10,899,922
(a) Financial information as of June 30, 2001 has been derived from the
audited, consolidated financial statements of the registrant.
The accompanying notes to the consolidated financial statements
are an integral part of these statements.
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UPTOWNER INNS, INC. AND SUBSIDIARY
CONSOLIDATED INCOME STATEMENT (UNAUDITED)
For the periods of three and six months ended December 31, 2001 and 2000
Three Months Ended Six Months Ended
2001 2000 2001 2000
Revenues:
Rooms $ 750,861 $ 849,760 $ 1,653,301 $ 1,852,713
Food and beverage 29,411 37,962 65,909 107,618
Telephone 2,079 12,385 9,394 27,869
Rents 53,366 50,509 107,703 104,912
Other 6,567 6,256 14,541 11,635
Total revenues 842,284 956,872 1,850,848 2,104,747
Costs and Expenses:
Operating Departments:
Cost of sales 31,090 44,151 70,952 105,109
Salaries and wages 197,032 232,129 439,839 490,542
Other 64,882 73,638 131,107 134,984
General and Administrative 85,991 94,978 147,730 180,007
Advertising 51,232 76,603 111,273 145,336
Utilities 57,165 54,910 123,282 122,275
Repairs and Maintenance 28,655 24,274 53,873 54,339
Interest 200,661 196,651 386,418 382,665
Taxes and licenses 82,150 93,018 175,836 197,882
Insurance 18,295 10,718 36,590 26,795
Depreciation and Amortization 109,321 104,903 218,478 209,805
Total costs and expenses 926,474 1,005,973 1,895,378 2,049,739
Operating income (loss) (84,190) (49,101) (44,530) 55,008
Other Income:
Interest income 0 60 0 119
Total other income 0 60 0 119
Net Income (Loss) before Income
Taxes (84,190) (49,041) (44,530) 55,127
Income Taxes 0 0 0 0
Net Income (Loss) $ (84,190) $ (49,041) $ (44,530) $ 55,127
Earnings (Loss) per Share $ (0.05) $ (.03) $ (.03) $ .03
The accompanying notes to the consolidated financial statements
are an integral part of these statements.
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UPTOWNER INNS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
For the six months ended December 31, 2001 and 2000
2001 2000
Cash Flows From Operating Activities:
Net income $ (44,530) $ 55,127
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 218,478 209,805
(Increase) decrease in deposits (61,401) 7,233
(Increase) decrease in current assets:
Accounts receivable (25,579) (1,573)
Inventories 120 8,720
Prepaid expenses 24,051 9,220
Increase (decrease) in current
liabilities:
Accounts payable (40,844) 8,403
Accrued liabilities 60,187 9,272
Taxes other than Federal income tax 64,805 (133,123)
Total adjustments 239,817 117,957
Net Cash Provided By Operating Activities $ 195,287 $ 173,084
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UPTOWNER INNS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
For the six months ended December 31, 2001 and 2000
2001 2000
Cash Flows From Investing Activities:
Capital Expenditures $ (25,370) $ (75,783)
Net cash used in investing activities (25,370) (75,783)
Cash Flows From Financing Activities:
Loan proceeds 0 0
Payment on notes and mortgages (287,361) (174,328)
Net cash used in
financing activities (287,361) (174,328)
Net Increase (Decrease) in Cash
and Cash Equivalents (117,444) (77,027)
Cash and Cash Equivalents at Beginning of Year 186,912 348,064
Cash and Cash Equivalents at End of Period $ 69,468 271,037
Supplemental Disclosures of Cash Flow Information:
Cash Paid During The Period For:
Interest $ 337,920 $ 380,274
The accompanying notes to the consolidated financial statements
are an integral part of these statements.
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UPTOWNER INNS, AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2001
1. BASIS OF PRESENTATION
The financial statements presented reflect Uptowner Inns, Inc. and its
consolidated subsidiary, Motel and Restaurant Supply.
The foregoing statements are unaudited; however, in the opinion of
management, all adjustments (comprising only normal recurring accruals)
necessary for a fair presentation of the financial statements have been
included. The results of operations for interim periods are not
necessarily indicative of the results that may be expected for a full
year or any other interim period. A summary of the Corporation's
significant accounting policies is set forth in Note 1 to the Consolidated
Financial Statements in the Corporation's Annual Report to shareholders
and Form 10-K for June 30, 2001.
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UPTOWNER INNS, AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 2001
2. CONTINGENCY
None.
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UPTOWNER INNS, INC. AND SUBSIDIARY
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FORWARD-LOOKING STATEMENTS
Certain matters disclosed herein may be deemed to be forward-looking
statements that involve risks and uncertainties, including the facilities
utilization, costs associated with maintaining the operations, liquidity
issues, and other risks. Actual strategies and results in future time
periods may differ materially from those currently expected. Such
forward-looking statements represent management's judgment as of the
current date. The Company disclaims, however, any intent of obligation
to update such forward-looking statements.
RESULTS OF OPERATION
THREE MONTHS ENDED DECEMBER 31, 2001 AND 2000
Due to the decline in the Huntington market, room revenues decreased
11.6% in the three months ended December 31, 2001 relative to the
comparable period in 2000. The average occupancy percentage for the three
months ended December 31, 2001 was 62.63%, a decrease of 5.92% relative to
the comparable period in 2000. This decline is due largely in part to the
events surrounding the September 11 terrorist attacks. The 22.5% decrease
in food and beverage revenues in the quarter ended December 31, 2001
relative to the comparable period in 2000, is relative to the decline in
room sales.
Costs and expenses decreased 7.9% from 2000. Salaries decreased
15.1% due to the decline in room sales. Advertising has decreased 33.1% in
the three months ended December 31, 2001 relative to the comparable period
in 2000. This decrease is due largely to the increased advertising and
marketing efforts that took place in the first couple of years that the
property was open. Insurance has increased 70.7% due to the rate
increases passed down by the Insurance industry. The Holiday Inn Hotel
and Suites project continues to do better than early projections had
suggested. The Star Report, generated by Smith Travel Research, shows the
Holiday Inn Hotel and Suites is continuing to increase their market share
in the Huntington area.
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RESULTS OF OPERATION, CONTINUED
SIX MONTHS ENDED DECEMBER 31, 2001 AND 2000
Room Revenues have decreased by 10.8% in the six months ended
December 31, 2001 relative to the comparable period in 2000. Food and
Beverage revenues have decreased by 38.8% in the six months ended
December 31, 2001 relative to the comparable period in 2000. These
differences, as well as the variances in expenses, are due to the
explanations above for the three month period ending December 31, 2001.
LIQUIDITY
The liquidity, as measured by current assets divided by current
liabilities, has slightly decreased from .30 at June 30, 2001 to
..24 at December 31, 2001. This decline is a result of continued under-
utilization of the Uptowner Inn facility coupled with the costs necessary
to maintain the operation. Management is currently evaluating
alternatives for the Uptowner Inn facility, and expects to have a plan in
place by the third quarter of the fiscal year ending June 30, 2002.
CAPITAL RESOURCES
The registrant has no plans at this time for any material commitments
for capital expenditures.
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UPTOWNER INNS, INC. AND SUBSIDIARY
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
None
b. The Company was not required to file Form 8-K for the quarter
ended December 31, 2001.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
(Registrant) UPTOWNER INNS, INC.
By /s/ Carl Midkiff,
CEO and Secretary
September 27, 2002
By /s/ David Robinson,
Treasurer
September 27, 2002
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