TORONTO (AP) - A total of $60.8 million in net pension plan expenses, asset writedowns and provisions plunged Four Seasons Hotels Inc. into a fourth-quarter net loss of $37.8 million, the company reported Thursday. The Toronto-based global luxury hotel operator, which reports in U.S. dollars, said Thursday its revenue was $58.5 million in the final three months of 2005, down from $69.5 million a year earlier. The net loss amounted to $1.03 per share, compared with year-ago earnings of $12.8 million, 34 cents per share.
"These unfavorable comparisons should not cloud the long-term strength of our business and our compelling industry position," Kathleen Taylor, president of worldwide business operations, told analysts in a conference call.
She defended the $25.3 million in accounting writedowns and provisions, much of which she said doesn't reflect ongoing value.
"While we would prefer never to have writedowns on these types of assets, even given what we know today I think we would make the same investment decisions based on the total returns we expect to receive from these investments as the long-term fee streams remain intact."
During the quarter, Four Seasons booked writedowns of $15.9 million on investments in hotel partnerships and corporations and $600,000 on management contracts, and took a provision of $8.8 million on long- term receivables.
There also was a $35.5-million loss on the transition of its executive and management pensions from an unfunded, defined-benefit plan to a funded, defined-contribution format. This change "was made to improve the certainty and predictability related to the cost of the retirement benefits," the company stated.
"We see these items as temporary challenges and believe that our financial results will begin to more clearly reflect our hotel and operating results over time," Taylor said.
Full-year revenue was $248.3 million, down from $261.3 million, with a loss of $28.2 million or 77 cents per share. In 2004 Four Seasons earned $25.7 million, 69 cents per share.
