EDITOR’S NOTE

Electronic Purses, E-Commerce and Cash Management in Hospitality Firms

    Atul Sheel

REFEREED ARTICLES

Spin-offs in the Lodging Industry

    Linda Canina and Teri Klein

This paper examines the effects of corporate spin-off announcements on
shareholder wealth in the hospitality industry. At the onset, various forms
of corporate restructuring and the underlying motivations for spinoffs are
discussed. Therafter, the paper uses the event study methodology to examine
the impact of specific voluntary spin-off announcements in the lodging
industry between 1964 and 1995. As such, the examples detailed in the paper
provide a good understanding of corporate restructuring and their strategic
role in creating additional value for hospitality firms.

The Relevance of Financial Leverage for Equity Returns of Restaurant Firms -
An Empirical Examination

    Atul Sheel and Nattika Wattanasuttiwong

This paper uses cross sectional time series regressions to investigate the
relationship between the debt/equity ratio of firms in the restaurant
industry and their risk/size adjusted common equity returns. Findings of
this paper suggest a statistically significant relationship between a
restaurant firm's debt/equity ratio and its risk/size adjusted common equity
returns. The relationship holds true regardless of the January effect, and
regardless of the use of real or nominal returns. As such, the findings
documented in this paper support the issue of capital structure relevance in
the restaurant industry, and are suggestive of a strategic relationship
between a restaurant firm’s debt use and the growth in its market/book
value.

Light Debt Users and Heavy Debt Users in the Restaurant Industry: A
Discriminant Analysis

    Zheng Gu

This paper uses the multivariate Fisher discriminant function to identify
and analyse the variables that distinguish light-debt restaurant firms from
heavy-debt restaurant firms. Research results suggest that managerial
control, size and type of operation are important variables explaining the
diversity in debt use within the restaurant industry. The analyses show that
small full service restaurant firms with low managerial ownership tend to
use less debt, while large economy/buffet or fast food restaurant firms
under tight managerial control are likely to be heavy debt users.

The Impact of Option Listings: A Study of Casino and Gaming Stocks

    Stanley M. Atkinson, Anthony K. Byrd and Gary E. Porter

This paper uses the event study methodology to examine the impact of option
listings on the common stock of 21 firms in the casino and gaming industry.
The analyses document interesting movements in common stock price and their
trading volume around option listings for casino/gaming firms. Research
findings also suggest that, while the introduction of option trading does
not change the relationship between these stocks’ returns and market
returns, the additional outlet for speculators reduces volatility
surrounding firm specific news, lowering the total risk of these stocks.

Effects of Destination Advertising on Financial Returns - A Comparative
Analysis of Two Inquiring Methods

    Liping A. Cai

This paper uses the data collected for a conversion study to examine the
effects of inquiring methods on the financial returns of an advertising
program in a Southwest US destination. Analyses show that although phone
inquirers are more likely to convert visitors,reader card inquirer-converted
visitors yield greater financial returns to a destination. The paper also
documents interesting variations in financial returns between/among
demographic segments within the reader card visitors. Implications of the
findings are discussed in the context of resource allocation, destimation
promotion and tourism policy.

INVITED ARTICLES

AHFME Member 1996 Total Annual Earnings Survey

    Raymond S. Schmidgall

This study was conducted to determine the 1995 annual earnings of
hospitality financial management educators. Nearly fifty percent of AHFME’s
members responded. Annual base salaries ranged from $28,000 to $105,000. The
lowest paid member is an instructor while the highest paid member is a full
professor. Most respondents supplement their base salaries by teaching
during summer school and conducting consulting. The total annual earnings of
members ranged from $30,000 to $158,250. Hospitality financial management
educators appear to be more highly compensated than hospitality industry
financial executives.

VIEWPOINT

The Asian Economic Crisis and International Business: Implications for
Tourism

    Mohammad A. Sadi and Frank L. Bartels

This paper reviews the unprecedented events leading to, and surrounding, the
East Asian currency, financial and economic crisis of 1997. It does so in
the context of globalization and development trajectories in context with
foreign direct investment and tourism industry. It emphasizes the impact of
the economic crisis on the regional tourism in Asia. The discussions take
the view that policy-makers require a long-term perspective, and conclude by
suggesting the areas of tourism industry worst hit by the crisis.

ABSTRACTS OF PRESENTATIONS AT THE TENTH ANNUAL AHFME RESEARCH SYMPOSIUM

An Argument for a Change in the Competitive Analysis Section of Lodging
Marketability Studies
    Bonnie Knutson and A.J. Singh

Dividend Policy in the Lodging Industry
    Linda Canina

The Impact of Option Listings on Common Stock Returns: A Casino/Gaming
Sector Study
    Stanley M. Atkinson, Anthony K. Byrd and Gary E. Porter

A Comparative Analysis of the SBA and USDA Small Business Loan Guarantee
Programs
    Raymond Schmidgall and A.J. Singh

An Analysis of Factors Associated with the Decision to Franchise in the
Restaurant Industry
    Yae Sock Roh and Flora G. Guidry

Yield Management and its Practical Application in Hotels
    Jeff Caneen and Zheng Gu

Performance of Exchange-Listed Lodging Firms During the Great Lodging
Depression of the 1980’s & Early 1990’s
    Arun Upneja

Forecasting Methods of Hospitality Operations
    Yang H. Huo

The Strategic Response of Lodging Companies to the Expected Changes in
Sources and Nature of Development Financing: A Chronological Review of
Changes in the Past and Delphi Study
    A.J. Singh