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LA QUINTA INNS, INC. ANNOUNCES SECOND QUARTER RESULTS

 SAN ANTONIO, Texas, July 22 /PRNewswire/ -- La Quinta Inns, Inc. (NYSE: LQM) today announced that revenues for the second quarter ended June 30, 1993, increased 5.4 percent or $3,612,000 to $71,053,000 as compared to last year's comparable quarter and that total revenues for the six month period ended June 30, 1993, increased 5.1 percent or $6,359,000 to $132,023,000 as compared to last year's comparable six month period. The improvement in revenues resulted from increases in average room rate over the prior year's comparable periods and improved occupancy for the six-month period.
 Operating income was $21,380,000 and $35,398,000 for the three month and six month periods, respectively, before a non-recurring, non-cash charge to recognize compensation expense related to the vesting of performance stock options, amounting to approximately ($4,407,000), ($2,732,000) net of income taxes or ($.20) per share, and the impact of a change made during 1992 in the estimated useful life of building assets from 30 years to 40 years, approximately $2,200,000 per quarter ($1,100,000 net of income taxes and partners' equity in earnings or $.08 per share). This compares to 1992 second quarter and six month operating income of $19,197,000 and $31,161,000, respectively, before severance and other employee related costs.
 During the quarter an overall gain of $91,000 was recognized related to the company's transfer of ownership to the mortgagor of the property in which the company's corporate headquarters are located. This is reflected as a loss of ($4,900,000) on property and investment transactions ($3,038,000) net of income taxes or ($.22) per share, and an extraordinary gain of $4,991,000, $3,094,000 net of income taxes or $.22 per share.
 Earnings before extraordinary items, inclusive of a cumulative effect of accounting change, were $2,692,000 or $.19 per share for the second quarter and $8,336,000 or $.60 per share for the six months compared to earnings before extraordinary items of $4,545,000 or $.33 per share and $5,955,000 or $.44 per share, respectively for the 1992 periods. Results for both the three and six month periods ended June 30, 1993, included $942,000 or $.07 per share, of extraordinary gains, net of taxes compared with extraordinary losses of ($197,000) or ($.01) per share and ($572,000) or ($.04) per share for the comparable three and six month periods of 1992. The net extraordinary gain in the 1993 second quarter consists of the $4,991,000 extraordinary gain described above which was partially offset by ($3,472,000) of extraordinary losses related to early extinguishment and refinancing of debt. The extraordinary losses in the 1992 period resulted from the refinancing of certain debt.
 Net earnings were $3,634,000 or $.26 per share for the second quarter and $9,278,000 or $.67 per share for the six months compared to net earnings of $4,348,000 or $.32 per share and $5,383,000 or $.40 per share, respectively, in the 1992 periods. The six month earnings for 1993 included the effect of a change in accounting for income taxes as required by Statement of Financial Accounting Standards No. 109 "Accounting for Income Taxes." The cumulative effect of this change increased net earnings by $1,500,000 or $.11 per share for the 1993 six month period.
 La Quinta owns and/or operates over 200 limited service inns in 29 states.
 LA QUINTA INNS, INC.
 COMBINED CONDENSED STATEMENTS OF EARNINGS
 (dollars in thousands, except per share amounts)
 (unaudited)
 Three Months Ended Six Months Ended
 June 30, June 30,
 1993 1992 1993 1992
 Total revenues $ 71,053 $ 67,441 $132,023 $125,664
 Operating costs and expenses:
 Direct 37,254 34,523 71,046 66,446
 Corporate 4,473 5,075 9,682 10,801
 Non-recurring charges -- 1,674 -- 1,674
 Performance stock option
 expense 4,407 -- 4,407 --
 Depreciation, amortization
 and fixed asset
 retirements 5,746 8,646 11,497 17,256
 Total operating costs and
 expenses 51,880 49,918 96,632 96,177
 Operating income 19,173 17,523 35,391 29,487
 Interest, net (5,753) (6,938) (11,790) (13,810)
 Partners' equity in earnings
 and losses (4,408) (3,473) (8,202) (6,291)
 Earnings before property and
 investment transactions 9,012 7,112 15,399 9,386
 Gain (loss) on property and
 investment transactions (4,670) 220 (4,373) 220
 Earnings before income taxes,
 extraordinary items and
 cumulative effect of
 accounting change 4,342 7,332 11,026 9,606
 Income taxes 1,650 2,787 4,190 3,651
 Net earnings before extra-
 ordinary items and cumulative
 effect of acctng. change 2,692 4,545 6,836 5,955
 Cumulative effect of accounting
 change -- -- 1,500 --
 Extraordinary items:
 Gain on mortgage transfer 4,991 -- 4,991 --
 Loss on early extinguishment
 and refinancing of debt (3,472) (318) (3,472) (922)
 Income taxes (benefit) 577 (121) 577 (350)
 Total extraordinary items,
 net of taxes 942 (197) 942 (572)
 Net earnings $ 3,634 $ 4,348 $ 9,278 $ 5,383
 Earnings per common and common
 equivalent share:
 Net earnings before extraordinary
 items and cumulative effect of
 accounting change $ .19 $ .33 $ .49 $ .44
 Cumulative effect of
 accounting change -- -- .11 --
 Extraordinary items, net of
 income taxes .07 (.01) .07 (.04)
 Net earnings per share$ .26 $ .32 $ .67 $ .40
 Weighted average number of common
 and common equivalent shares
 outstanding 13,975 13,384 13,896 13,347
 Percentage of occupancy 69.8 69.8 65.7 64.7
 Average room rates $ 46.92 $ 44.44 $ 46.41 $ 44.59


COMBINED CONDENSED BALANCE SHEETS (in thousands)(unaudited)
 La Quinta Inns
 June 30, December 31,
 1993 1992
 ASSETS
 Cash $ 39,729 $ 12,861
 Other current assets 25,008 12,595
 Total current assets 64,737 25,456
 Notes receivable, excluding
 current installments 7,887 7,696
 Investments 11,573 10,296
 Properties held for sale, at
 estimated net realizable value 3,920 3,920
 Land held for future development,
 at cost 1,470 1,452
 Property and equipment 731,790 697,868
 Accumulated depreciation and
 amortization (217,715) (214,398)
 Deferred charges and other assets,
 at cost less applicable
 amortization 13,968 6,893
 Total $617,630 $539,183
 LIABILITIES & SHAREHOLDERS' EQUITY
 Current liabilities $ 55,880 $ 36,984
 Current installments of long-term
 debt 17,709 21,711
 Total current liabilities 73,589 58,695
 Long-term debt, excluding
 current installments 331,081 274,824
 Deferred credits, principally
 income taxes 16,585 19,283
 Partners' capital, (net of
 note receivable) 57,254 62,060
 Shareholders' equity 139,121 124,321
 Total $617,630 $539,183
 -0- 7/22/93
 /CONTACT: Investor Relations, La Quinta Inns, Inc., 210-366-6030/
 (LQM)


CO: La Quinta Inns, Inc. ST: Texas IN: LEI SU: ERN

LG -- NY079 -- 4683 07/22/93 15:13 EDT
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Date:Jul 22, 1993
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