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TMCNet: Great Wolf reports $4.1 million loss

[August 06, 2008]

Great Wolf reports $4.1 million loss

(Wisconsin State Journal, The (KRT) Via Acquire Media NewsEdge) Aug. 5--Great Wolf Resorts reported today that its second-quarter loss of $4.1 million loss, or 13 cents per diluted share, reflected the shift in earlier Easter and spring-break periods from the second quarter of 2007 to the first quarter of 2008, as well as increased depreciation and amortization and interest expense in 2008. In the second quarter of 2007, the Madison-based indoor waterpark resort company lost $1.6 million or 5 cents per diluted share.

But the first quarter of 2008, even with Easter and spring break revenue, still resulted in a greater loss than the previous first quarter. In May, Great Wolf reported a loss of $2.3 million in the first quarter compared to a loss of $2 million in the first quarter of 2007.

Company leaders, however, said they were pleased with this year's second-quarter performance, which beat predictions by analysts, boosted its full-year earnings, citing strong performance in July and advance bookings through August.

"We had an excellent second quarter," said Randy Churchey, interim chief executive officer. "We were particularly pleased with our results in light of softness seen in the overall economy and the operating results of many other consumer discretionary-spending companies and lodging companies."

The company reported second-quarter revenue of $63 million compared to $45.5 million in the second quarter of 2007. The increase reflected the opening in December of a resort in Grapevine, Texas, and the opening in March of a resort in Grand Mound, Wash.

Analysts surveyed by Thomson Financial predicted a loss of 14 cents per share on revenue of $59.4 million.

Excluding special items, the company now expects its third-quarter results to range from a loss of 5 cents per share to profit of 3 cents per share. For the full year, Great Wolf predicts its loss will range from 18 to 32 cents per share.

Analysts, who generally exclude special items, forecast third-quarter earnings of 1 cent and a full-year loss of 31 cents.

"Our guests typically live within a few hours' drive of our resorts, which means that rising gasoline prices have only a minimal impact on the typical family's cost of a Great Wolf Resort vacation," said Kimberly Schaefer, chief operating officer. "We believe that, compared to the cost and logistical challenges of air travel to a destination resort or theme park, we offer a strong combination of convenience and price-value for families."

Great Wolf, through its subsidiaries and affiliates, owns and operates 11 resorts under the Great Wolf Lodge and Blue Harbor Resort names and has a 12th Great Wolf Lodge under construction in Concord, N.C. The 402-room resort is scheduled to open next spring.

The company continues to pursue projects in Connecticut, the Mall of America in Bloomington, Minn., and on the shores of Lake Lanier, near Atlanta, Ga.

For the second quarter, Great Wolf said revenue per available room was up 3.4 percent.

Great Wolf stock closed Tuesday at $4.30 per share, up 23 cents or 5.6 percent, on the Nasdaq exchange.

The Associated Press contributed to this report.

To see more of The Wisconsin State Journal, or to subscribe to the newspaper, go to http://www.wisconsinstatejournal.com.

Copyright (c) 2008, The Wisconsin State Journal
Distributed by McClatchy-Tribune Information Services.
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