Bermuda's eight major hotels have raked in profits of $5.8 million -- breaking a six-year run of losses.

Hotel chiefs hailed the turnaround as a triumph for tough cost-cutting measures.

"There is now light at the end of the tunnel,'' said BHA president Mr.

Stephen Barker.

But yesterday Bermuda Industrial Union president Mr. Ottiwell Simmons was distinctly unimpressed.

He accused hotels of inflating their coffers with tips deprived from workers.

Mr. Simmons reckoned roughly $4 million had been denied employees since 1992.

"Quite honestly I expected the hotels would make a profit,'' he said.

The eight major hotels are Belmont, Harmony Hall, Elbow Beach, Grotto Bay, Marriott's Castle Harbour, Princess, Southampton Princess, and Sonesta Beach.

Details of their finances were released at a Bermuda Hotel Association Press conference yesterday.

The combined unaudited statements were compiled by chartered accountants, Cooper & Lines, and show a net profit of $5.8 million for the year ended September 30, 1994.

For the years, 1988-93, the hotels were hit by respective net losses of $3.8 million, $2.27 million, $5.5 million, $17.47 million, $12.4 million and $5.37 million.

In 1987 the hotels clocked up a net profit of $7.4 million.

Mr. Barker said cumulative losses had now been trimmed to $41 million.

He claimed there was finally "light at the end of the tunnel'' for the hotels, which had been rocked by oppressive taxes.

"We must all strive for a higher level of service -- a better tourism product -- without raising prices.'' He added: "The encouraging though still tenuous bottom line is the direct result of sustained cost cutting measures and efficiency improvements implemented by the major hotels.

"Payroll costs, although extremely high by international standards, have declined as a percentage of sales for the third successive year.'' According to the financial statements payroll costs -- including salaries, wages and employee benefits -- amounted to $63.9 million.

Mr. Barker said there was a need for continued emphasis on "cost containment strategies'' coupled with "innovative programmes'' to attract more tourists.

"However, despite cause for cautious optimism, total revenue is still below the level achieved in 1990.

"Worldwide competition continues to exert downward pressure on prices with the result that gross revenue per unit sold has decreased from $314 in 1992 to a current level of $307 per room.

"A persistent worry is the low ratio of `income before fixed expenses', a key measure of operating results.

Financial boost for hotels "Currently at 14.7 percent, it remains well below the 25 percent level considered by the industry worldwide as a satisfactory benchmark.'' Mr. Barker said hotels were hopeful of financial breaks this year from the Bermuda Electric Light Company and the Bermuda Telephone Company.

Meetings had been held with Belco and Telco in a bid to get a better understanding with them, he added.

Mr. Barker said talks had also been held with Finance Minister the Hon. David Saul.

Dr. Saul had been told the hotel industry could not afford to make up for any financial shortfall brought on the by the closure of the US Bases.

Yesterday Mr. Simmons said the turnaround in the hotels' fortunes had nothing to do with increased efficiency.

He added: "I would like The Royal Gazette to make an analysis of the hotels' accounts as they did for the BIU, and in so doing I would like the paper to discover what amount of that profits is gratuities which belong to the workers.'' IMPROVING FORTUNES -- This graph shows how Bermuda's eight major hotels have ended a six-year financial slump.