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Starwood Hotels Forecasts First-Quarter Profit Below Estimates

Thursday, 13 Feb 2014 09:37 AM

Starwood Hotels & Resorts Worldwide Inc. reported fourth-quarter revenue below Wall Street's expectations, partly due to lower occupancy and room rates in Asia, excluding China, and forecast a weak profit for the current quarter.

The owner of the Sheraton and Westin hotel chains said it expects first-quarter profit of 53 cents to 56 cents per share. The forecast range is well below the average analyst estimate of 63 cents per share, according to Thomson Reuters I/B/E/S.

Slow economic growth in Asia and an oversupply of new hotels during the boom years of 2006 and 2007 have resulted in declines in room and occupancy rates.

Starwood's revenue per available room for hotels open at least one year in Asia, excluding China, fell 3 percent in the fourth quarter ended Dec. 31.

RevPAR is a metric of hotel health, calculated by multiplying a hotel's average daily room rate by its occupancy rate.

Total revenue fell 1.8 percent to $1.51 billion, missing the average analyst estimate of $1.53 billion.

Net income fell to $128 million, or 67 cents per share, from $142 million, or 72 cents per share, a year earlier.

Excluding items, Starwood earned 73 cents per share, above the 70 cents per share analysts had expected.

The company's shares closed at $77.09 on the New York Stock Exchange on Wednesday.

The stock has gained about 24 percent in the past 12 months, outperforming the 21 percent rise in the Dow Jones U.S. Hotels index.

© 2017 Thomson/Reuters. All rights reserved.

   
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Starwood Hotels & Resorts Worldwide Inc. reported fourth-quarter revenue below Wall Street's expectations, partly due to lower occupancy and room rates in Asia, excluding China, and forecast a weak profit for the current quarter.
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2014-37-13
Thursday, 13 Feb 2014 09:37 AM
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