In a press release on Dec. 13, ILX Resorts announced that it will not pay the last quarterly installment of its $0.50 per share annual dividend for the calendar year 2007.

In a press release on Dec. 13, ILX Resorts announced that it will not pay the last quarterly installment of its $0.50 per share annual dividend for the calendar year 2007.

The company also said that it is discontinuing payment of future dividends until further notice.

“We believe it is prudent at this time to preserve cash to fund growth, with a view to considering resumption of cash dividends as operating performance and available capital resources relative to growth and investment opportunities warrant,” ILX

Chairman and CEO Joe Martori said.

On Nov. 14, ILX reported a loss of $0.09 per share for the quarter ended Sept. 30 versus a gain of $0.18 in the same quarter of the prior year.

With 3.5 million shares outstanding, each due an installment or reinvestment allocation worth $0.125 each, the company will save approximately $441,000.

Controlling more than 600,000 shares owned personally and also as part of Martori Enterprises, Martori stands to lose the most in the company’s change in policy, foregoing approximately $75,000 if he had received the fourth-quarter payment in cash.

The next largest indirect holders are the firm’s employees through the company’s employee stock ownership plan and trust which holds 560,000 shares.

Dimensional Fund Advisors is the stock’s largest institutional holder with 260,000 shares and these would have yielded $32,000 at the end of the quarter if the dividend were paid.

According to its most recent financial filing with the Securities and Exchange Commission, ILX primarily acquires, develops and operates premier timeshare resorts in the western United States and includes eight resorts in Arizona and several other properties in the U.S. and Mexico.

Although Yahoo Finance and some other financial Web sites associate ILX with the resorts and casino sector — a comparison group that includes many companies like Harrah’s that are primarily gambling and entertainment operations — ILX falls more logically within the financial sector’s subgroup of property management.

For comparison, Bluegreen Corp., trading on the New York Stock Exchange under the ticker BXG, is considered the only pure timeshare stock left since Sunterra Corp., formerly traded on the NASDAQ under the ticker symbol SNRR, was delisted and subsequently purchased by privately held Diamond Resorts.

While ILX stock was below $3 per share at press time, BXG stock is also suffering, trading at $6.53 per share, or $0.27 above its 52-week low of $6.26.

Both stocks’ 52-week highs had been above $13.

Although investors who were looking forward to their quarterly income from ILX will be disappointed, halting a dividend is considered a positive step by lenders and others who see conservation of cash as a good first step in correcting poor financial results.

Susan Johnson can be reached at 282-7795, Ext. 129 or e-mail sjohnson@larsonnewspapers.com