The president of Quality Inns International Inc. said yesterday the company is in the process of selling facilities that could be hurt by tightening gasoline availability.
Although the company is in the midst of an expansion program that will see the company grow from about 333 inns to about 500 by 1982, Joseph McCarthy, the firm's president, said the expansion will be in the cities and resorts where the effects of gasoline shortages would be less profound.
McCarthy's remarks on the energy situation followed a presentation to stockholders at the company's annual meeting at Quality's Silver Spring headquarters.
The company, which tripled its profits to more than $4.3 million for the year ending Aug. 31, 1979, announced tentative record profits for the first quarter of the new fiscal year.
Quality said it expected to report profits of between $1.3 and $1.45 million for the quarter, compared to profits of $900,000 for the first fiscal quarter last year.
The company also announced a dividend increase of 2 1/2 cents, to 12 1/2 cents a share to shareholders as of Jan. 2. The dividend is payable Jan. 20.
McCarthy told stockholders that the summer gasoline shortage "had only a minor effect on our overall revenues for the period."
But McCarthy also said the company had "taken a number of steps to realign its properties so as to reduce the impact of any energy shortages or economic swings."
Asked after the meeting about the realignment, McCarthy said the company is "selling those properties that have been most susceptible to the availability of fuel."
McCarthy said the company had already sold inns in Phoenix, Greenboro and Kansas City that are dependent on traffic from interstate highways.
Instead, the company is pushing ahead with expansion plans in cities, near airports and tourist sites.
"It is very difficult today to get financing for a project on a major interstate highway," he said. "The lending industry has become sensitive to energy."
Quality Inns, the seventh largest accommodations chain in the country, now has an average room rate of $29, up from about $21 three years ago. By next summer, that figure could rise to $31 a room, McCarthy said, as a result of increased construction costs.
Asked about diversification, Chairman Stewart Bainum said the company board had decided "to confine our efforts and resources to the business we're in and closely related businesses."
But both McCarthy and Bainum stressed the company's growth plans, which include Mexico. The company has four facilities operating there now and has two others in the works.
Bainum said the company would make between $700,000 and $1 million on Mexican operations with an investment of under $17,000, an example he said of the value of franchising.
Quality Inns, McCarthy said, is "positioned" in the right place for the time period. "Quality Inns' price structure, complements the airlines' emphasis on economic fares," he said. "People who fly economy will stay economy, and that translates into increased demand for moderately priced rooms.