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Previous: GOLD RESERVE CORP, 10-Q, 1996-11-14 |
Next: GOODRICH B F CO, 10-Q, 1996-11-14 |
<PAGE> 1
F O R M 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
____________________
Quarterly Report Pursuant to Section 13 or
15 (d) of The Securities Exchange Act
of 1934
____________________
For Quarter Ended September 30, 1996
Commission File No. 2-64309
GOLF HOST RESORTS, INC.
STATE OF COLORADO EMPLOYER IDENTIFICATION NO. 84-0631130
Post Office Drawer 3131, Durango, Colorado 81302
Telephone Number (303) 259-2000
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 twelve months, and (2) has been subject to the
filing requirements for the past 90 days. - Yes X No
----- -----
Issuer has no common stock subject to this report.
Page 1 of 20
<PAGE> 2
GOLF HOST RESORTS, INC.
BALANCE SHEETS
SEPTEMBER 30, 1996 AND DECEMBER 31, 1995
ASSETS
(Substantially all pledged - Notes 2 and 3)
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1996 1995
----------------- ---------------
<S> <C> <C>
CURRENT ASSETS:
Cash $ 981,269 $ 312,603
Accounts receivable 4,756,058 4,471,677
Notes receivable 104,203 627,817
Inventories and supplies 4,845,432 4,392,498
Prepaid expenses and other 1,273,682 1,207,186
Intercompany receivables 718,874 567,455
---------------- ---------------
Total current assets 12,679,518 11,579,236
---------------- ---------------
LONG-TERM RECEIVABLES, less
amounts currently due 951,171 1,011,871
PROPERTY AND EQUIPMENT, at cost,
less accumulated depreciation 39,936,373 40,231,020
---------------- ---------------
$ 53,567,062 $ 52,822,127
================ ===============
</TABLE>
The accompanying notes are an integral part of these balance sheets. These
statements were prepared from the books and records of the Company without
audit and, in the opinion of management, include all adjustments which are
necessary for a fair presentation.
Page 2
<PAGE> 3
GOLF HOST RESORTS, INC.
BALANCE SHEETS
SEPTEMBER 30, 1996 AND DECEMBER 31, 1995
LIABILITIES AND SHAREHOLDERS' INVESTMENT
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1996 1995
---------------- -------------
<S> <C> <C>
CURRENT LIABILITIES:
Notes payable $ 613,191 $ 1,285,773
Maturing long-term obligations 2,902,030 1,854,401
Accounts payable 2,191,030 1,911,052
Accrued expenses 4,149,577 4,274,085
Deposits and prepaid fees 2,369,171 2,681,066
---------------- -------------
Total current liabilities 12,224,999 12,006,377
---------------- -------------
LONG-TERM OBLIGATIONS,
less current maturities 18,680,395 20,659,348
---------------- -------------
LONG-TERM INTERCOMPANY 4,973,718 4,124,210
---------------- -------------
LONG-TERM CONTINGENCY 2,185,916 2,077,759
---------------- -------------
SHAREHOLDERS' INVESTMENT:
Common stock, $1 par, 5,000
shares authorized and out-
standing 5,000 5,000
5.6% cumulative preferred
stock, $1 par, 4,577,000
shares authorized and
outstanding 4,577,000 4,577,000
Paid-in capital 2,329,447 2,329,447
Retained earnings 8,590,587 7,042,986
---------------- -------------
Total shareholders' investment 15,502,034 13,954,433
---------------- -------------
$ 53,567,062 $ 52,822,127
================ =============
</TABLE>
The accompanying notes are an integral part of these balance sheets. These
statements were prepared from the books and records of the Company without
audit and, in the opinion of management, include all adjustments which are
necessary for a fair presentation.
Page 3
<PAGE> 4
GOLF HOST RESORTS, INC.
STATEMENTS OF INCOME (LOSS)
FOR THE QUARTERS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
<TABLE>
Quarters Ended September 30,
---------------------------------------------
1996 1995
----------------- ----------------
<S> <C> <C>
REVENUES:
Hotel $ 3,978,191 $ 3,665,987
Food and beverage 2,923,444 2,690,793
Golf 2,801,712 2,635,659
Other 1,303,403 1,253,125
Real Estate Activity 671,105 397,327
---------------- ----------------
11,677,855 10,642,891
---------------- ----------------
COSTS AND OPERATING EXPENSES:
Hotel 3,570,192 3,272,684
Food and beverage 2,265,814 2,180,122
Golf 1,320,423 1,303,537
Other 3,940,124 3,617,656
General and administrative 902,864 939,581
Real Estate Activity 279,750 231,154
---------------- ----------------
12,279,167 11,544,734
---------------- ----------------
OPERATING INCOME (LOSS) (601,312) (901,843)
INTEREST, NET 494,740 528,292
---------------- ----------------
INCOME (LOSS) BEFORE INCOME TAXES (1,096,052) (1,430,135)
PARENT INCOME TAX CHARGE (CREDIT) (412,400) (525,400)
---------------- ----------------
NET INCOME (LOSS) BEFORE DIVIDEND
REQUIREMENTS ON PREFERRED STOCK (683,652) (904,735)
DIVIDEND REQUIREMENTS ON
PREFERRED STOCK 64,078 63,900
---------------- ----------------
NET INCOME (LOSS) AVAILABLE
TO COMMON SHAREHOLDERS $ (747,730) $ (968,635)
================ ================
EARNINGS (LOSS) PER COMMON SHARE $ (149.55) $ (193.73)
================ ================
<CAPTION>
Nine Months Ended September 30,
----------------------------------------------
1996 1995
------------------ ----------------
<S> <C> <C>
REVENUES:
Hotel $ 14,853,314 $ 14,907,634
Food and beverage 11,497,395 11,569,877
Golf 12,321,416 12,324,758
Other 4,960,517 5,091,216
Real Estate Activity 656,817 397,327
------------------ ----------------
44,289,459 44,290,812
------------------ ----------------
COSTS AND OPERATING EXPENSES:
Hotel 12,625,972 12,617,680
Food and beverage 7,789,587 7,761,806
Golf 4,606,662 4,680,609
Other 11,914,851 11,573,209
General and administrative 2,829,865 2,894,039
Real Estate Activity 280,227 233,929
------------------ ----------------
40,047,164 39,761,272
------------------ ----------------
OPERATING INCOME (LOSS) 4,242,295 4,529,540
INTEREST, NET 1,490,460 1,554,852
------------------ ----------------
INCOME (LOSS) BEFORE INCOME TAXES 2,751,835 2,974,688
PARENT INCOME TAX CHARGE (CREDIT) 1,012,000 1,120,700
------------------ ----------------
NET INCOME (LOSS) BEFORE DIVIDEND
REQUIREMENTS ON PREFERRED STOCK 1,739,835 1,853,988
DIVIDEND REQUIREMENTS ON
PREFERRED STOCK 192,234 192,412
------------------ ----------------
NET INCOME (LOSS) AVAILABLE
TO COMMON SHAREHOLDERS $ 1,547,601 $ 1,661,576
================== ================
EARNINGS (LOSS) PER COMMON SHARE $ 309.52 $ 332.32
================== ================
</TABLE>
The accompanying notes are an integral part of these statements. These
statements were prepared from the books and records of the Company without
audit and, in the opinion of management, include all adjustments which are
necessary for a fair presentation.
Page 4
<PAGE> 5
GOLF HOST RESORTS, INC. STATEMENTS OF SHAREHOLDERS' INVESTMENT
FOR THE TWENTY-ONE MONTHS ENDED SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
$1 Par Value 5.6% Cumulative
Common Stock Preferred Stock
-------------------- --------------------------
Shares Amount Shares Amount
------ --------- --------- ----------
<S> <C> <C> <C> <C>
Balance, December 31, 1994 5,000 $ 5,000 4,577,000 $4,577,000
------ --------- --------- ----------
Net income available to
common shareholders - - - -
------ --------- --------- ----------
Balance, December 31, 1995 5,000 5,000 4,577,000 4,577,000
Net income available to
common shareholders - - - -
------ --------- --------- ---------
Balance, September 30, 1996 5,000 $ 5,000 4,577,000 $4,577,000
====== ========= ========= ==========
<CAPTION>
Other Shareholders'
Investment Total
Paid-In Retained Shareholders'
Capital Earnings Investment
---------- --------- ------------
<S> <C> <C> <C>
Balance, December 31, 1994 $2,329,447 $5,923,381 $12,834,828
---------- ---------- -----------
Net income available to
common shareholders - 1,119,605 1,119,605
---------- ---------- -----------
Balance, December 31, 1995 2,329,447 7,042,986 13,954,433
Net income available to
common shareholders - 1,547,601 1,547,601
---------- ---------- -----------
Balance, September 30, 1996 $2,329,447 $8,590,587 $15,502,034
========== ========== ===========
</TABLE>
The accompanying notes are an integral part of these statements. These
statements were prepared from the books and records of the Company without
audit and, in the opinion of management, include all adjustments which are
necessary for a fair presentation.
Page 5
<PAGE> 6
GOLF HOST RESORTS, INC.
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------------
1996 1995
-------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income before dividend requirements
on preferred stock $ 1,739,835 $ 1,853,988
Adjustments to reconcile net
income to net cash flows from
operating activities:
Depreciation 1,870,300 1,842,300
Changes in working capital
other than cash (Note 7) (1,303,889) (2,528,350)
------------- -------------
Net cash flows provided by
operating activities 2,306,246 1,167,938
------------- -------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment (1,642,429) (3,019,066)
Recovery of cost of property and
equipment sold 66,776 3,740
Reduction in notes receivable 592,096 108,131
Additions to notes receivable (7,782) (287,476)
------------- -------------
Net cash flows used in investing
activities (991,339) (3,194,671)
------------- -------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in notes payable (672,582) 663,019
Increases in long-term obligations 480,105 1,300,165
Decreases in long-term obligations (1,411,429) (1,868,410)
Increase in long-term intercompany 849,508 1,143,884
Increase in long-term contingency 108,157 120,375
------------- -------------
Net cash flows used in by
financing activities (646,241) 1,359,033
------------- -------------
NET INCREASE (DECREASE) IN CASH 668,666 (667,700)
CASH, BEGINNING OF PERIOD 312,603 824,875
------------- -------------
CASH, END OF PERIOD $ 981,269 $ 157,175
============= =============
</TABLE>
Supplemental information on noncash financing and investing activities is
included in Note 7.
The accompanying notes are an integral part of these statements. These
statements were prepared from the books and records of the Company without
audit and, in the opinion of management, include all adjustments which are
necessary for a fair presentation.
Page 6
<PAGE> 7
GOLF HOST RESORTS, INC. NOTES TO
FINANCIAL STATEMENTS
SEPTEMBER 30, 1996 AND 1995
(1) ORGANIZATION, BUSINESS AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
During the quarter, there was no significant change from the 10-K filing
of December 31, 1995.
Financial Statement Presentation
Certain reclassifications have been made to the December 31, 1994,
September 30, 1995 and December 31, 1995 financial statements to conform
to the September 30, 1996 presentation. All adjustments to the interim
financial statements are of a normal recurring nature.
(2) LINES OF CREDIT
During the quarter, there was no significant change from the 10-K filing
of December 31, 1995 except as follows:
Under provisions of the related loan agreements, approximately $3,940,000
was available for immediate use.
(3) LONG-TERM OBLIGATIONS
Long-term obligations consist of the following:
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
-------------- --------------
<S> <C> <C>
Mortgage notes at varying rates, maturing
primarily from 2002 to 2007 $ 17,369,763 $ 18,810,140
Equipment revolving credit line
at prime, maturing serially
from 1997 to 2000 4,020,292 3,862,987
Other 678,125 346,622
Unamortized debt discount expense (485,755) (506,000)
-------------- --------------
21,582,425 22,513,749
Less-current maturities (2,902,030) (1,854,401)
-------------- --------------
$ 18,680,395 $ 20,659,348
============== ==============
</TABLE>
Page 7
<PAGE> 8
The remainder of Note 3 has not changed significantly from the 10-K
filing of December 31, 1995.
(4) LEASES
During the quarter, there was no significant change from the 10-K filing
of December 31, 1995.
(5) ACCRUED EXPENSES
Accrued expenses consist of the following:
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
------------- -------------
<S> <C> <C>
Rental pool lease distribution $ 1,872,659 $ 1,760,259
Salaries 1,066,507 1,400,364
Taxes, other than income taxes 631,575 742,033
Other 578,836 371,429
------------- -------------
$ 4,149,577 $ 4,274,085
============= =============
</TABLE>
(6) INCOME TAX ALLOCATION AND SHARING POLICY
During the quarter, there was no significant change from the 10-K filing
of December 31, 1995.
(7) SUPPLEMENTAL CASH FLOW DATA
The (increases) decreases in working capital other than cash are as
follows:
<TABLE>
<CAPTION>
Nine Months Ended September 30,
---------------------------------------
1996 1995
--------------- ----------------
<S> <C> <C>
Accounts and notes receivable $ (284,381) $ (693,530)
Inventories and supplies (452,934) (55,431)
Prepaid expenses and other (66,496) 43,325
Intercompany (343,653) (1,082,940)
Accounts payable 279,978 913,683
Accrued expenses (124,508) (745,047)
Deposits and prepaid fees (311,895) (908,410)
-------------- ---------------
$ (1,303,889) $ (2,528,350)
============== ==============
</TABLE>
Page 8
<PAGE> 9
<TABLE>
<S> <C> <C>
Noncash Financing Activities:
The Company satisfied its preferred
stock dividend liability to
Golf Hosts, Inc. through the
intercompany accounts. $ 192,234 $ 192,412
</TABLE>
Page 9
<PAGE> 10
GOLF HOST RESORTS, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Occupancy for the quarter, measured in room nights, improved 3.5% from
the year-ago level. On a divisional basis, the increases were .9% and 8.1% for
Innisbrook and Tamarron, respectively. The increases were primarily in the
conference segment.
Revenues for the quarter were 9.7% ahead of last year. On a per
occupied room night basis, revenues increased 6.0%, with Innisbrook
experiencing a 4.8% increase while Tamarron experienced a gain of 6.7%.
The operating loss for the quarter was 5.1% of total revenues, compared
with 8.5% a year earlier. The improvement generally can be attributed to
economies of scale that typically accompany higher levels of business.
Interest expense, net, reflects a modest improvement, generally attributable to
a reduction in the level of debt outstanding and a reduction in the prime rate
of interest at which a portion of the Company's debt bears interest.
In summary, the $334,083 improvement in income (loss) before income
taxes, when compared with the same quarter a year earlier, reflects the increase
in revenues of $1,034,964 coupled with an improvement marginal operating
income.
For the nine months ended September 31, 1996, occupied rooms declined
5.4% from the level of a year earlier. A 5.7% increase in the level of
spending per occupied room, with both divisions reporting gains, resulted in
total revenues virtually identical to a year ago. Costs and operating expenses
were 90.4% of revenues compared with 89.8% for the same period a year earlier.
The $222,853 decline in income before income taxes reflects the change in the
operating margin percentage partially offset by a reduction in interest
expense, net.
FINANCIAL CONDITION
At September 30, 1996, the Company's net working capital position was
$454,519, compared with $403,214 at September 30, 1995, and a deficit $427,141
at December 31, 1995. The Company typically experiences seasonal fluctuations
in its net working capital position without impairing its ability to pay its
trade creditors in a timely manner and satisfy its financial obligations in an
orderly fashion.
The Company maintains satisfactory relations with several financial
institutions. Liquidity is provided by an accounts receivable and inventory
credit line of $6,000,000, of which approximately $3,940,000 was available for
immediate use at September 30, 1996, and a revolving mortgage credit facility,
which was fully drawn at September 30, 1996, of $2,000,000. Specific financing
is in place for most equipment additions.
Based on expected operating levels for the balance of the year and the
existence of credit facilities with its lenders, the Company assesses its
liquidity situation as satisfactory.
Page 10
<PAGE> 11
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Registrant is not currently involved in lawsuits other than
ordinary routine litigation incidental to its business.
Item 2. Changes in Securities
Not applicable.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
Pursuant to an agreement with the SEC staff, included in
this 10-Q filing are unaudited financial statements of the
Innisbrook Rental Pool Lease Operation and the Tamarron
Rental Pool Lease Operation for the quarter and nine months
ended September 30, 1996.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27 Financial Data (for SEC use only)
(b) Reports on Form 8-K
None
Page 11
<PAGE> 12
SIGNATURES
Pursuant to the requirements 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.
GOLF HOST RESORTS, INC.
Date: November 13, 1996 By: /s/ R. S. Ferreira
------------------------- --------------------------
Richard S. Ferreira
Executive Vice President
Chief Financial Officer
Date: November 13, 1996
-------------------------
By: /s/ A. S. Herzog
--------------------------
A. Stephen Herzog
Vice President and Controller
Chief Accounting Officer
Page 12
<PAGE> 13
RENTAL POOL LEASE OPERATIONS
The following unaudited financial statements of the Innisbrook Rental Pool
Lease Operation and the Tamarron Rental Pool Lease Operation (the Rental Pools)
are for the quarter and nine months ended September 30, 1996.
The operations of the Rental Pools are tied closely to that of Golf Host
Resorts, Inc. (the Company), and provide for distribution of a percentage of
the Company's room revenues, as defined in the Rental Pool Master Lease
Agreements, to participating condominium owners (Participants).
The operations of the Rental Pools are more fully discussed in Form 10-K, for
the fiscal year ended December 31, 1995 (File No. 2-64309).
Page 13
<PAGE> 14
INNISBROOK RENTAL POOL LEASE OPERATION
BALANCE SHEETS
SEPTEMBER 30, 1996 AND 1995
DISTRIBUTION FUND
<TABLE>
<CAPTION>
1996 1995
------------- -------------
ASSETS
<S> <C> <C>
RECEIVABLE FROM GOLF HOST RESORTS, INC.
FOR DISTRIBUTION - FULLY SECURED $ 1,160,240 $ 1,176,159
INTEREST RECEIVABLE FROM MAINTENANCE
ESCROW FUND 19,021 16,870
------------- -------------
$ 1,179,261 $ 1,193,029
============= =============
LIABILITIES AND PARTICIPANTS' FUND BALANCES
DUE TO PARTICIPANTS FOR DISTRIBUTION $ 808,871 $ 894,318
DUE TO MAINTENANCE ESCROW FUND 245,640 129,711
RESERVE FOR ESTIMATED LIFE-SAFETY
REIMBURSEMENT 124,750 169,000
PARTICIPANTS' FUND BALANCES - -
------------- -------------
$ 1,179,261 $ 1,193,029
============= =============
MAINTENANCE ESCROW FUND
ASSETS
CASH AND CASH EQUIVALENTS $ 1,467,308 $ 1,211,979
INVENTORIES 251 251
RECEIVABLE FROM DISTRIBUTION FUND 245,640 129,711
INTEREST RECEIVABLE 20,216 22,529
------------- -------------
$ 1,733,415 $ 1,364,470
============= =============
LIABILITIES AND PARTICIPANTS' FUND BALANCES
ACCOUNTS PAYABLE $ 34,792 $ 100,082
INTEREST PAYABLE TO DISTRIBUTION FUND 19,021 16,870
CARPET CARE RESERVE 38,720 52,534
PARTICIPANTS' FUND BALANCES 1,640,882 1,194,984
------------- ------------
$ 1,733,415 $ 1,364,470
============= ============
</TABLE>
These balance sheets were prepared from the books and records of the Rental
Pool without audit and, in the opinion of management, include all adjustments
which are necessary for a fair presentation.
Page 14
<PAGE> 15
INNISBROOK RENTAL POOL LEASE OPERATION
STATEMENTS OF OPERATIONS
FOR THE QUARTERS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
DISTRIBUTION FUND
<TABLE>
<CAPTION>
Current Quarter Year-to-Date
------------------------------------------ ------------------------------------------
1996 1995 1996 1995
-------------------- -------------------- -------------------- --------------------
<S> <C> <C> <C> <C>
GROSS REVENUES $ 2,090,975 $ 1,903,330 $ 11,710,587 $ 11,670,716
------------------- ------------------- ------------------- -------------------
REDUCTIONS:
Agents' commissions 4,685 7,594 207,955 249,072
Audit fees 3,000 3,100 9,100 8,950
------------------- ------------------- ------------------- -------------------
7,685 10,694 217,055 258,022
------------------- ------------------- ------------------- -------------------
ADJUSTED GROSS REVENUES 2,083,290 1,892,636 11,493,532 11,412,694
MANAGEMENT FEE (979,146) (889,539) (5,401,960) (5,363,966)
------------------- ------------------- ------------------- -------------------
GROSS INCOME DISTRIBUTION 1,104,144 1,003,097 6,091,572 6,048,728
ADJUSTMENTS TO GROSS INCOME
DISTRIBUTION:
Corporate complimentary
occupany fees 1,451 1,894 6,592 5,104
Occupancy fees (245,641) (259,412) (1,199,597) (1,072,828)
Advisory Committee expenses (20,447) (22,504) (66,525) (64,241)
Life-safety reimbursement (79,456) (3,000) (124,750) (169,000)
------------------- ------------------- ------------------- -------------------
NET INCOME DISTRIBUTION 760,051 720,075 4,707,292 4,747,763
ADJUSTMENTS TO NET INCOME
DISTRIBUTION:
Occupancy fees 245,641 259,412 1,199,597 1,072,828
Hospitality suite fees 2,672 - 9,853 2,727
Greens fees 9,186 8,942 66,239 70,018
Additional participation credit 17,940 18,730 54,325 56,995
------------------- ------------------- ------------------- -------------------
AMOUNT AVAILABLE FOR DISTRIBUTION
TO PARTICIPANTS $ 1,035,490 $ 1,007,159 $ 6,037,306 $ 5,950,331
=================== =================== =================== ===================
Average daily distribution $ 11.83 $ 11.22 $ 24.47 $ 23.66
Average room rate $ 78.14 $ 71.77 $ 11,140.00 $ 104.98
Room nights 26,761 26,519 105,119 111,171
Occupancy percentage 30.6% 29.5% 42.6% 44.2%
Available number of units 87,543 89,797 246,679 251,509
Average number of available units 952 976 900 921
</TABLE>
These statements were prepared from the books and records of the Rental
Pool without audit and, in the opinion of management, include all
adjustments which are necessary for a fair presentation.
Page 15
<PAGE> 16
INNISBROOK RENTAL POOL OPERATION
STATEMENTS OF CHANGES IN PARTICIPANTS' FUND BALANCES
FOR THE QUARTERS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
DISTRIBUTION FUND
<TABLE>
<CAPTION>
Current Quarter
------------------------------------------
1996 1995
-------------------- --------------------
<S> <C> <C>
BALANCE, beginning of period $ - $ -
ADDITIONS:
Amounts available for distribution
before life-safety reimbursement 1,114,946 1,010,159
Interest received or receivable from
Maintenance Escrow Fund 19,021 16,870
REDUCTIONS:
Amount withheld for Maintenance Escrow Fund (245,640) (129,711)
Amounts held in reserve for estimated
life-safety reimbursement (79,456) (3,000)
Amounts accrued or paid to participants (808,871) (894,318)
------------------- -------------------
BALANCE, end of period $ - $ -
=================== ===================
MAINTENANCE ESCROW FUND
BALANCE, beginning of period $ 1,607,083 $ 1,361,622
ADDITIONS:
Amounts withheld from occupancy fees 245,640 129,711
Interest earned 19,021 16,870
Charges to participants to establish
or restore escrow balances 319,098 343,496
REDUCTIONS:
Maintenance charges (493,740) (607,147)
Carpet care reserve deposit (6,553) (2,598)
Interest accrued or paid to
Distribution Fund (19,021) (16,870)
Refunds to participants as prescribed
by Master Lease Agreement (30,646) (30,100)
------------------- -------------------
BALANCE, end of period $ 1,640,882 $ 1,194,984
=================== ===================
<CAPTION>
Year-to-Date
------------------------------------------
1996 1995
-------------------- --------------------
<S> <C> <C>
BALANCE, beginning of period $ - $ -
ADDITIONS:
Amounts available for distribution
before life-safety reimbursement 6,162,056 6,119,331
Interest received or receivable from
Maintenance Escrow Fund 60,152 41,641
REDUCTIONS:
Amount withheld for Maintenance Escrow Fund (961,112) (536,428)
Amounts held in reserve for estimated
life-safety reimbursement (124,750) (166,000)
Amounts accrued or paid to participants (5,136,346) (5,458,544)
------------------- -------------------
BALANCE, end of period $ - $ -
=================== ===================
BALANCE, beginning of period $ 1,141,259 $ 851,207
ADDITIONS:
Amounts withheld from occupancy fees 961,112 536,428
Interest earned 60,152 41,641
Charges to participants to establish
or restore escrow balances 838,563 1,060,337
REDUCTIONS:
Maintenance charges (1,210,085) (1,196,139)
Carpet care reserve deposit (25,638) (10,739)
Interest accrued or paid to
Distribution Fund (60,152) (41,641)
Refunds to participants as prescribed
by Master Lease Agreement (64,329) (46,110)
------------------- -------------------
BALANCE, end of period $ 1,640,882 $ 1,194,984
=================== ===================
</TABLE>
These statements were prepared from the books and records of the Rental
Pool without audit and, in the opinion of management, include all
adjustments which are necessary for a fair presentation.
Page 16
<PAGE> 17
TAMARRON RENTAL POOL LEASE OPERATION
BALANCE SHEETS
SEPTEMBER 30, 1996 AND 1995
DISTRIBUTION FUND
<TABLE>
<CAPTION>
1996 1995
------------ ------------
ASSETS
<S> <C> <C>
CASH $ 1,000 $ 1,000
RECEIVABLE FROM GOLF HOST RESORTS, INC.
FOR DISTRIBUTION 837,169 779,886
INTEREST RECEIVABLE FROM MAINTENANCE
ESCROW FUND 481 1,424
------------- -------------
$ 838,650 $ 782,310
============= =============
LIABILITIES AND PARTICIPANTS' FUND BALANCES
DUE TO PARTICIPANTS FOR DISTRIBUTION $ 751,101 $ 703,711
DUE TO MAINTENANCE ESCROW FUND 87,549 78,599
PARTICIPANTS' FUND BALANCES - -
------------- -------------
$ 838,650 $ 782,310
============= =============
MAINTENANCE ESCROW FUND
ASSETS
CASH AND CASH EQUIVALENTS $ 74,509 $ 128,262
DUE FROM DISTRIBUTION FUND 87,549 78,599
INTEREST RECEIVABLE - 1,277
INVENTORY:
Linen 99,871 98,965
Materials and supplies 7,229 10,151
DEPOSITS 86,077 60,209
------------- -------------
$ 355,235 $ 377,463
============= =============
LIABILITIES AND PARTICIPANTS' FUND BALANCES
ACCOUNTS PAYABLE $ 5,033 $ 560
INTEREST PAYABLE TO DISTRIBUTION FUND 481 1,424
PARTICIPANTS' FUND BALANCES 349,721 375,479
------------- -------------
$ 355,235 $ 377,463
============= =============
</TABLE>
These balance sheets were prepared from the books and records of the Rental
Pool without audit and, in the opinion of management, include all adjustments
which are necessary for a fair presentation.
Page 17
<PAGE> 18
TAMARRON RENTAL POOL LEASE OPERATION
STATEMENTS OF OPERATIONS
FOR THE QUARTERS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
DISTRIBUTION FUND
<TABLE>
<CAPTION>
Current Quarter Year-to-Date
------------------------------------------ ------------------------------------------
1996 1995 1996 1995
-------------------- -------------------- -------------------- --------------------
<S> <C> <C> <C> <C>
GROSS REVENUES $ 1,887,216 $ 1,762,657 $ 3,142,727 $ 3,236,918
-------------------- -------------------- ------------------- --------------------
REDUCTIONS:
Sales and marketing expenses 160,413 158,639 102,880 90,805
Agents' commissions 50,520 42,084 267,131 291,323
Audit fees 2,601 2,709 7,803 7,689
------------------- ------------------- ------------------- -------------------
213,534 203,432 377,814 389,817
-------------------- ------------------- ------------------- -------------------
ADJUSTED GROSS REVENUES 1,673,682 1,559,225 2,764,913 2,847,101
MANAGEMENT FEE (836,841) (779,612) (1,382,457) (1,423,550)
------------------- ------------------- ------------------- --------------------
GROSS INCOME DISTRIBUTION 836,841 779,613 1,382,456 1,423,551
ADJUSTMENTS TO GROSS INCOME
DISTRIBUTION:
Corporate complimentary
occupancy fees 1,989 1,007 3,587 2,471
Occupancy fees (131,790) (123,223) (255,948) (273,076)
Designated items (20,653) (15,987) (54,312) (50,965)
Advisory Committee expenses (1,661) (733) (7,424) (6,425)
------------------- ------------------- ------------------- -------------------
POOLED INCOME 684,726 640,677 1,068,359 1,095,556
ADJUSTMENTS TO POOLED INCOME:
Hospitality suite fees - - 53 105
Occupancy fees 131,790 123,223 255,948 273,076
------------------- ------------------- ------------------- -------------------
NET INCOME DISTRIBUTION $ 816,516 $ 763,900 $ 1,324,360 $ 1,368,737
=================== =================== =================== ===================
Average daily distribution $ 32.01 $ 31.04 $ 17.17 $ 18.27
Average room rate $ 114.85 $ 115.99 $ 98.15 $ 95.79
Room nights 16,432 15,197 32,019 33,791
Occupancy percentage 64.4% 61.8% 41.5% 45.1%
Average number of available units 277 267 282 274
Number of units in Rental Pool at
end of period 302 291 - -
</TABLE>
These statements were prepared from the books and records of the Rental
books and records of the Rental Pool without audit and, in the opinion
of management, include all adjustments which are necessary for a fair
presentation.
Page l8
<PAGE> 19
TAMARRON RENTAL POOL LEASE OPERATION
STATEMENTS OF CHANGES IN PARTICIPANTS' FUND BALANCES
FOR THE QUARTERS AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
DISTRIBUTION FUND
<TABLE>
<CAPTION>
Current Quarter
------------------------------------------
1996 1995
-------------------- --------------------
<S> <C> <C>
BALANCE, beginning of period $ - $ -
ADDITIONS:
Amounts available for distribution 816,516 763,900
Interest received or receivable from
Maintenance Escrow Fund 480 1,424
REDUCTIONS:
Amounts withheld for Maintenance Escrow Fund (65,895) (61,613)
Amounts accrued or paid to participants (751,101) (703,711)
------------------- -------------------
BALANCE, end of period $ - $ -
=================== ===================
MAINTENANCE ESCROW FUND
BALANCE, beginning of period $ 336,079 $ 351,513
ADDITIONS:
Amounts withheld from occupancy fees 65,895 61,613
Interest earned 480 1,424
Reimbursement of designated items 20,653 15,987
Charges to participants to establish
or restore escrow balances 85,132 12,715
REDUCTIONS:
Maintenance and inventory charges (30,995) (19,317)
Refurbishing charges (98,167) (27,808)
Interest accrued or paid to
Distribution Fund (480) (1,424)
Designated items (20,653) (15,987)
Refunds to participants as prescribed
by Master Lease Agreement (8,223) (3,237)
------------------- -------------------
BALANCE, end of period $ 349,721 $ 375,479
=================== ===================
<CAPTION>
Year-to-Date
------------------------------------------
1996 1995
-------------------- --------------------
<S> <C> <C>
BALANCE, beginning of period $ - $ -
ADDITIONS:
Amounts available for distribution 1,324,360 1,368,736
Interest received or receivable from
Maintenance Escrow Fund 2,807 4,254
REDUCTIONS:
Amounts withheld for Maintenance Escrow Fund (127,975) (136,540)
Amounts accrued or paid to participants (1,199,192) (1,236,450)
------------------- -------------------
BALANCE, end of period $ - $ -
=================== ===================
BALANCE, beginning of period $ 328,336 $ 397,655
ADDITIONS:
Amounts withheld from occupancy fees 127,975 136,540
Interest earned 2,807 4,254
Reimbursement of designated items 54,312 50,965
Charges to participants to establish
or restore escrow balances 227,764 89,781
REDUCTIONS:
Maintenance and inventory charges (119,617) (119,974)
Refurbishing charges (191,716) (110,586)
Interest accrued or paid to
Distribution Fund (2,807) (4,254)
Designated items (54,313) (50,965)
Refunds to participants as prescribed
by Master Lease Agreement (23,020) (17,937)
------------------- -------------------
BALANCE, end of period $ 349,721 $ 375,479
=================== ===================
</TABLE>
These statements were repared from the books and records of the Rental
Pool without audit and, in the opinion of management, include all
adjustments which are necessary for a fair presentation.
Page 19
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<EXCHANGE-RATE> 1
<CASH> 981,269
<SECURITIES> 0
<RECEIVABLES> 4,918,942
<ALLOWANCES> 58,681
<INVENTORY> 4,845,432
<CURRENT-ASSETS> 12,679,518
<PP&E> 65,858,158
<DEPRECIATION> 25,921,785
<TOTAL-ASSETS> 53,567,062
<CURRENT-LIABILITIES> 12,224,999
<BONDS> 21,582,425
0
4,577,000
<COMMON> 5,000
<OTHER-SE> 10,920,034
<TOTAL-LIABILITY-AND-EQUITY> 53,567,062
<SALES> 15,175,646
<TOTAL-REVENUES> 44,289,459
<CGS> 4,657,045
<TOTAL-COSTS> 40,047,164
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 20,587
<INTEREST-EXPENSE> 1,490,460
<INCOME-PRETAX> 2,751,835
<INCOME-TAX> 1,012,000
<INCOME-CONTINUING> 1,739,835
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,547,601
<EPS-PRIMARY> 309.52
<EPS-DILUTED> 309.52
</TABLE>
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