Castle Group expanding abroad as net income rises 506 percent
Castle Group Inc., the Honolulu-based parent company of Castle Resorts & Hotels, reported first-quarter net income rose fivefold to $99,658 as it benefited from the addition of new properties, better occupancy and a gain on foreign exchange.
The company said net income compared to $19,702 a year earlier as revenue rose 21 percent to $6.0 million. The sales increase was attributed to the addition of new properties under contract, strengthening of the New Zealand dollar and changes in rates and occupancy at the hotel rooms and resort condominiums Castle manages.
"While revenues grew handsomely year over year, not all of this increase was translated into net income because of our decision to increase our investment in international expansion and development into Thailand and Vietnam," said Rick Wall, chairman and chief executive officer, in a press statement.
"We are strategically reinvesting some of the profits at this time in order to accelerate some of our future growth initiatives."
Castle reported operating expenses rose 18 percent on increases in operating costs and more corporate and international staff that it hired to handle increased growth. The company said it is seeing growth opportunities outside of Hawai'i, as demand here has changed because of the economy, loss of Aloha and ATA airlines and increased air fares to the state.
Castle Group said its expansion into Micronesia, New Zealand, Thailand and Vietnam should tend to offset the impact of Hawai'i trends.