Red Lion reports net loss; company buys Denver hotel

Red Lion Hotels Corp. on Wednesday released lower first-quarter earnings figures, although occupancy and revenue per room improved.

The Spokane-based chain also announced the purchase of a Denver hotel that will become its largest when the deal closes, and the termination of several franchise agreements, including those covering two Sandpoint properties.

Revenues for the quarter, $39.6 million, increased slightly compared with 2007. The net loss was $4.5 million, or 25 cents per share, compared with $2 million, or 10 cents, for the 2007 quarter.

Adjusting for changes in the number of company and franchised Red Lions, hotel revenue increased 4 percent. Results at several franchised properties were reduced by renovation activity.

Revenue from its entertainment operations declined $100,000, to $3.2 million.

The Denver purchase, for $25.3 million, is the 478-room Radisson Hotel Denver Southwest. The hotel is 20 minutes from Denver’s downtown and 25 minutes from Denver International Airport. Red Lion has one franchised hotel in the downtown after not renewing a franchise agreement with another.

Red Lion will invest $8 million in improvements at the Radisson after its purchase. The deal will be financed from a $50 million line of credit.

Red Lion shares rose nine cents, to $9.18, prior to release of earnings.