Net income totaled $6.6 million or 21 cents per diluted share versus $14.9 million or 48 cents in the same period last year. On a non-GAAP basis, however, Donovan says net income was $12.7 million or 41 cents per diluted share.

Total sales under the new rules were $141.9 million compared to $159.3 million in second quarter 2005. Bluegreen Resorts' sales separately were $91.4 million versus $97 million last year at this time. Bluegreen Communities' sales separately were $50.6 million compared to $62.3 million a year ago. "As previously announced, these lower sales at Bluegreen Communities reflected the sellout or near sellout of several communities prior to the end of the second quarter," Donovan explains.

"As expected, and as previously announced, the adoption of the new accounting regulations adversely impacted results for the second quarter, primarily as a result of deferring revenues until subsequent periods," the Bluegreen chief says. However, on a non-GAAP accounting basis, total second-quarter sales were $163.9 million versus $159.3 million in second quarter 2005. On the same basis, the resort group's sales increased 16.8% to $113.4 million from $97 million.

The new rules, effective Jan. 1, 2006, are called Statement of Position 04-2, or SOP. They were set up by the American Institute of Certified Public Accounts for time-sharing transactions.

"The adoption of the SOP has masked the success of Bluegreen Resorts' business transactions," Donovan says in a prepared statement. "We believe that this business and the markets in which it operates remain strong with significant potential for growth." He says Bluegreen "enjoyed continued same-store sales growth" in the second quarter, "led by our sales offices at the Bluegreen Wilderness Club at Big Cedar, Ridgedale, MO."

Donovan says Bluegreen's balance sheet at the quarter's June 30 close reflected unrestricted cash of $43.8 million, a book value of $10.47 per share and a debt-to-equity ratio of 1.03:1.