For the three months ended June 30th, Meditrust is reporting aloss from continued operations of $83.4 million versus income of$47.6 million for the same period last year. Company officials citeexpenses from the five-point plan as a key reason for the loss,including professional and advisory fees and costs arising from theearly repayment and modification of certain debt.Revenues for thesecond quarter were also down from 1999, with Meditrust reporting$219.4 million in 2000, compared to $329.7 million. The decline wasattributed to a decrease in healthcare assets from 394 on June30th, 1999 to 310 at present.

A major tenet of the reorganization plan is for Meditrust todivest itself of a large portion of its healthcare assets to focuson the lodging industry and its recent purchase of the La Quintahotel chain.Meditrust announced its repositioning in January due toconcerns about limited income from the Federal Government for itschain of nursing homes, as well as various supply and labor issues.But while the firm holds great hope in the future of the 300-motelLa Quinta chain, that sector has also been hit hard of late, withMeditrust reporting a decline in revenues for the second quarterfrom $162.3 million to $158.2 million. Occupancy was down from73.0% to 67.4%, while revenue per available room also dippedsignificantly, from $44.14 in the second quarter of 1999 to $42.58this year.

"While we are disappointed with the operating results of LaQuinta for the second quarter, the companies have made progressduring my first 90 days as CEO," says Meditrust executive FrancisW. Cash in announcing the results. He adds that, "With its seniormanagement team solidified and a new organizational structure inplace, La Quinta is positioned to begin the process of improvingits results and to once again grow through the recently announcedfranchise program."

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